Landsea Homes Reports Fourth Quarter and Full Year 2024 Results
- Record fourth quarter home sales revenue of $450.6 million
- Record fourth quarter home closings of 937, up 41%
- Record full year total revenue of $1.55 billion
- Fourth quarter net new home orders of 636, up 60%
- Fourth quarter cash from operations of $47.8 million
- Fourth quarter net income of $3.0 million, or $0.08 per diluted share
- Full year net income of $17.2 million or $0.47 per diluted share
- Year-end book value per share of $18.37
DALLAS, Feb. 27, 2025 (GLOBE NEWSWIRE) -- Landsea Homes Corporation (Nasdaq: LSEA) (“Landsea Homes” or the “Company”) announced today financial results for the fourth quarter and full year ended December 31, 2024. For the quarter, the Company reported pretax income of $6.5 million and net income of $3.0 million, or $0.08 per diluted share. Adjusted net income (a non-GAAP measure) was $9.1 million or $0.25 per diluted share. For the full year, pretax income was $26.7 million, and net income was $17.2 million, or $0.47 per diluted share. Reported net income for the year includes one-time pretax transaction costs of $8.5 million or $0.17 per diluted share impact. Excluding these costs, net income would have been $23.6 million or $0.64 per diluted share. Adjusted net income was $41.7 million or $1.14 per diluted share. Excluding the one-time transaction costs, adjusted net income was $48.0 million or $1.31 per diluted share.
Management Commentary
“Landsea Homes produced strong year-over-year top-line growth of 22% in the fourth quarter of 2024, driven primarily by a 41% increase in new home deliveries,” said John Ho, Landsea Homes’ Chief Executive Officer. “For the full year of 2024, total revenues came in at a record $1.6 billion, and the company closed the highest level of new home deliveries in its history at 2,831. These results were made possible by the great execution and hard work from our team members, as well as the strategic growth initiatives we’ve pursued since our company’s founding.”
Mr. Ho continued, “We generated 636 net new orders during the fourth quarter, which represented a 60% increase as compared to the fourth quarter of 2023. Our sales pace came in at 2.7 homes per community per month, which was a 23% improvement over the same period last year. Mortgage incentives continue to be an important selling tool with buyers, and we utilized them during the quarter to drive order activity and clear out some of the excess standing inventory at our communities. While this had a negative impact on our margins, it also resulted in better cash generation and a reduction in our spec inventory. During the quarter we generated $47.8 million in cash from our operations.”
Mr. Ho concluded, “We believe we are in a strong position as we head into the spring selling season, thanks to our great community locations and our unique product portfolio. Our High-Performance Homes continue to stand out from the competition, both in terms of quality and value, and we feel this differentiation is key to winning over discerning buyers in the market for a new home. As a result, I remain optimistic about the long-term outlook for our company.”
Fourth Quarter Operating Results
Total revenue was a record $486.7 million, up 22% compared to the fourth quarter of 2023, primarily driven by contributions from the Colorado division, increased deliveries in Texas as a result of the Antares acquisition, the opening of our Austin communities, and a 55% increase in home sales revenue from the Arizona division.
New homes delivered increased 41% to 937 homes at an average sales price of $481,000, compared to 664 homes at an average sales price of $572,000 in the fourth quarter of 2023.
Net new home orders increased 60% to 636 homes with a dollar value of $289.8 million, an average sales price of $456,000 and a monthly absorption rate of 2.7 sales per active community. This compares to 398 homes with a dollar value of $218.9 million, an average sales price of $550,000 and a monthly absorption rate of 2.2 sales per active community in the prior year period. As a percentage of gross orders, cancellations equaled 14% compared to 13% in the fourth quarter of 2023.
Total lots owned or controlled at December 31, 2024, were 10,944, representing a 4.2 year supply based on the last twelve months’ net orders. This compares to 11,176 owned or controlled at December 31, 2023. The company continues to pursue an asset-light strategy, controlling 56% of lots while the remaining 44% are owned.
Home sales gross margin in the fourth quarter was 12.5% compared to 15.9% in the prior year period. Adjusted home sales gross margin (a non-GAAP measure) was 18.4% compared to 20.8% in the prior year period. The decrease was primarily the result of elevated mortgage rates and the higher cost of sales incentives used to close homes during the quarter.
Net income attributable to Landsea Homes decreased 76% to $3.0 million compared to $12.5 million in the prior year period. Adjusted net income attributable to Landsea Homes (a non-GAAP measure) was $9.1 million compared to $16.3 million in the prior year period. Net income per share on a fully diluted basis was $0.08, compared to $0.33 in the fourth quarter of 2023. Adjusted net income per share (a non-GAAP measure) on a fully diluted basis was $0.25 compared to $0.43 in the fourth quarter of 2023.
Adjusted EBITDA (a non-GAAP measure) was $38.6 million compared to $40.3 million in the prior year period.
Full Year 2024 Operating Results
Total revenue was a record $1.6 billion, up 28% compared to the full year 2023, primarily driven by the Arizona division producing a 40% increase in home sales revenue on a 38% increase in deliveries, coupled with the Antares acquisition in the DFW market, and the opening of Austin communities. In total, Texas delivered 414 homes and $168.9 million in revenue.
New homes delivered increased 33% to a record 2,831 homes at an average sales price of $525,000, compared to 2,123 homes at an average sales price of $551,000 for the full year 2023.
Net new home orders increased 35% to 2,634 homes with a dollar value of $1.3 billion, an average sales price of $504,000, and a monthly absorption rate of 2.8 sales per active community. This compares to 1,947 homes with a dollar value of $1.1 billion, an average sales price of $571,000 and a monthly absorption rate of 2.8 sales per active community in the prior year. The increase in new home orders was primarily from significant increases in Colorado and Texas following recent acquisitions in those segments, and a 36% and 24% increase in the Arizona and Florida segments, respectively, partially offset by a 35% decrease in the California segment due to repositioning the pipeline of communities in Northern California.
Total homes in backlog at the end of 2024 was 390 homes with a dollar value of $212.4 million and an average sales price of $545,000 compared to 517 homes with a dollar value of $335.6 million and an average sales price of $649,000 at December 31, 2023.
Home sales gross margin was 14.7% compared to 17.3% in the prior year. Adjusted home sales gross margin (a non-GAAP measure) was 20.3% compared to 22.4% in the prior year. The decrease was primarily due to elevated mortgage rates and the associated increase to closing incentives across the operating segments.
Net income attributable to Landsea Homes decreased 41.1% to $17.2 million compared to $29.2 million in the prior year. Adjusted net income attributable to Landsea Homes (a non-GAAP measure) was $41.7 million compared to $48.6 million in the prior year. Net income per share on a fully diluted basis was $0.47, a 37.3% decrease compared to $0.75 in 2023. Adjusted net income per share (a non-GAAP measure) on a fully diluted basis was $1.14 compared to $1.24 in 2023.
Adjusted EBITDA (a non-GAAP measure) was $136.2 million compared to $112.3 million in the prior year.
Balance Sheet
As of December 31, 2024, the Company had total liquidity of $241.8 million consisting of cash and cash equivalents as well as cash held in escrow of $57.2 million and $184.5 million in availability under the Company’s $455.0 million unsecured revolving credit facility. Total debt, net of issuance costs, was $725.4 million at December 31, 2024 compared to $543.8 million at December 31, 2023.
Landsea Homes’ ratio of debt to capital was 51.8% at December 31, 2024 and the Company’s net debt to total capital (a non-GAAP measure) was 47.7% at December 31, 2024. This compares to a debt to capital ratio of 44.1% and a net debt to total capital ratio of 30.4% at December 31, 2023.
First quarter 2025
- New home deliveries anticipated to be in a range of 600 to 700
- Delivery ASPs expected to be in a range of $475,000 to $500,000
- Home sales gross margins between 13% and 14% on a GAAP basis and between 18% and 19% on an adjusted basis
Full Year 2025
- New home deliveries anticipated to be in a range of 3,000 to 3,400
- Delivery ASPs expected to be in a range of $500,000 to $525,000
- Home sales gross margins approximately 15% on a GAAP basis and approximately 20% on an adjusted basis
Conference Call
The Company will hold a conference call today at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss its fourth quarter and full year 2024 results and conduct a question-and-answer session.
- Toll-free dial-in number: 800-274-8461
- International dial-in number: 203-518-9814
The conference call will also be broadcast live and available for replay in the Investors section of the Landsea Homes website at https://ir.landseahomes.com/.
A replay of the conference call will be available approximately three hours after conference end time through March 14, 2025.
Replay Details:
- Toll-free replay number: 844-512-2921
- International replay number: 412-317-6671
- Replay ID: 11158244
About Landsea Homes Corporation
Landsea Homes Corporation (Nasdaq: LSEA) is a publicly traded residential homebuilder based in Dallas, Texas that designs and builds best-in-class homes and sustainable master-planned communities in some of the nation's most desirable markets. The company has developed homes and communities in New York, Boston, New Jersey, Arizona, Colorado, Florida, Texas and throughout California in Silicon Valley, Los Angeles, and Orange County. Landsea Homes was honored as the Green Home Builder 2023 Builder of the Year, after being named the 2022 winner of the prestigious Builder of the Year award, presented by BUILDER magazine, in recognition of a historical year of transformation.
An award-winning homebuilder that builds suburban, single-family detached and attached homes, mid-and high-rise properties, and master-planned communities, Landsea Homes is known for creating inspired places that reflect modern living and provides homebuyers the opportunity to “Live in Your Element.” Our homes allow people to live where they want to live, how they want to live – in a home created especially for them.
Driven by a pioneering commitment to sustainability, Landsea Homes’ High Performance Homes are responsibly designed to take advantage of the latest innovations with home automation technology supported by Apple®. Homes include features that make life easier and provide energy savings that allow for more comfortable living at a lower cost through sustainability features that contribute to healthier living for both homeowners and the planet.
Led by a veteran team of industry professionals who boast years of worldwide experience and deep local expertise, Landsea Homes is committed to positively enhancing the lives of our homebuyers, employees, and stakeholders by creating an unparalleled lifestyle experience that is unmatched.
For more information on Landsea Homes, visit: www.landseahomes.com.
Forward-Looking Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws, including, but not limited to, our expectations for future financial performance, business strategies or expectations for our business. These statements constitute projections, forecasts, and forward-looking statements, and are not guarantees of performance. Landsea Homes cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Words such as “may,” “can,” “should,” “will,” “estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “seek,” “target,” “look” or similar expressions may identify forward-looking statements. Specifically, forward-looking statements may include statements relating to the future financial performance of Landsea Homes; changes in the market for Landsea Homes’ products and services; and other expansion plans and opportunities.
These forward-looking statements are based on information available as of the date of this press release and our management’s current expectations, forecasts, and assumptions, and involve a number of judgments, risks and uncertainties that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.
These risks and uncertainties include, but are not limited to, the risk factors described by Landsea Homes in its filings with the Securities and Exchange Commission (“SEC”). These risk factors and those identified elsewhere in this press release, among others, could cause actual results to differ materially from historical performance and include, but are not limited to:
- the cyclical nature of our industry and the possibility that adverse changes in general and local economic conditions could reduce the demand for homes;
- our ability to develop communities successfully and in a timely manner;
- changes in the terms and availability of mortgage financing, interest rates, federal lending programs, and tax laws, affecting the demand for and the ability of our homebuyers to complete the purchase of a home;
- our geographic concentration, which could materially and adversely affect us if the homebuilding industry in our current markets should experience a decline;
- the potential for adverse weather and geological conditions to increase costs, cause project delays or reduce consumer demand for housing;
- our ability to promptly sell one or more properties for reasonable prices in response to changing economic, financial and investment conditions, and the risk that we may be forced to hold non-income producing properties for extended periods of time;
- our reliance on third-party skilled labor, suppliers and long supply chains;
- the dependence of our long-term sustainability and growth upon our ability to acquire lots that are either developed or have the approvals necessary for us to develop them; and
- the other risks and uncertainties indicated in Landsea Homes’ SEC reports or documents filed or to be filed with the SEC by Landsea Homes.
Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and you should not place undue reliance on these forward-looking statements in deciding whether to invest in our securities. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Stock Repurchase
Under its stock repurchase program, Landsea Homes may purchase its common stock in open market transactions effected through a broker-dealer at prevailing market prices, in block trades, or by other means in accordance with federal securities laws, including pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The Company is not obligated to repurchase any specific number or amount of shares of common stock, and it may modify, suspend or discontinue the program at any time. The Company will determine the timing and amount of repurchase in its discretion based on a variety of factors, such as the market price of the Company’s common stock, corporate requirements, general market economic conditions and legal requirements.
Investor Relations Contact:
Drew Mackintosh, CFA
Mackintosh Investor Relations, LLC
drew@mackintoshir.com
(310) 924-9036
Media Contact:
Annie Noebel
Cornerstone Communications
anoebel@cornerstonecomms.com
(949) 449-2527
|
Landsea Homes Corporation Consolidated Balance Sheets (in thousands, except share and per share amounts) | ||||||
| December 31, | ||||||
| 2024 | 2023 | |||||
| Assets | ||||||
| Cash and cash equivalents | $ | 53,322 | $ | 119,555 | ||
| Cash held in escrow | 3,921 | 49,091 | ||||
| Real estate inventories | 1,339,082 | 1,121,726 | ||||
| Due from affiliates | 419 | 4,348 | ||||
| Goodwill | 155,597 | 68,639 | ||||
| Other assets | 148,996 | 107,873 | ||||
| Total assets | $ | 1,701,337 | $ | 1,471,232 | ||
| Liabilities | ||||||
| Accounts payable | $ | 86,348 | $ | 77,969 | ||
| Accrued expenses and other liabilities | 212,645 | 160,256 | ||||
| Due to affiliates | 881 | 881 | ||||
| Line of credit facility, net | 194,435 | 307,631 | ||||
| Senior notes, net | 530,919 | 236,143 | ||||
| Total liabilities | 1,025,228 | 782,880 | ||||
| Commitments and contingencies | ||||||
| Equity | ||||||
| Stockholders’ equity: | ||||||
| Preferred stock, $0.0001 par value, 50,000,000 shares authorized, none issued and outstanding as of December 31, 2024 and December 31, 2023, respectively | — | — | ||||
| Common stock, $0.0001 par value, 500,000,000 shares authorized, 41,712,850 issued and 36,316,855 outstanding as of December 31, 2024, 41,382,453 issued and 36,520,894 outstanding as of December 31, 2023 | 4 | 4 | ||||
| Additional paid-in capital | 462,363 | 465,290 | ||||
| Retained earnings | 204,815 | 187,584 | ||||
| Total stockholders’ equity | 667,182 | 652,878 | ||||
| Noncontrolling interests | 8,927 | 35,474 | ||||
| Total equity | 676,109 | 688,352 | ||||
| Total liabilities and equity | $ | 1,701,337 | $ | 1,471,232 | ||
|
Landsea Homes Corporation Consolidated Statements of Operations (in thousands, except share and per share amounts) | |||||||||||||
| Three Months Ended December 31, | Year Ended December 31, | ||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||
| Revenue | |||||||||||||
| Home sales | $ | 450,554 | $ | 379,668 | $ | 1,486,938 | $ | 1,169,867 | |||||
| Lot sales and other | 36,127 | 17,947 | 63,399 | 40,080 | |||||||||
| Total revenues | 486,681 | 397,615 | 1,550,337 | 1,209,947 | |||||||||
| Cost of sales | |||||||||||||
| Home sales | 394,244 | 319,392 | 1,268,968 | 967,034 | |||||||||
| Lot sales and other | 31,099 | 12,169 | 53,577 | 27,939 | |||||||||
| Total cost of sales | 425,343 | 331,561 | 1,322,545 | 994,973 | |||||||||
| Gross margin | |||||||||||||
| Home sales | 56,310 | 60,276 | 217,970 | 202,833 | |||||||||
| Lot sales and other | 5,028 | 5,778 | 9,822 | 12,141 | |||||||||
| Total gross margin | 61,338 | 66,054 | 227,792 | 214,974 | |||||||||
| Sales and marketing expenses | 31,593 | 21,576 | 98,189 | 73,248 | |||||||||
| General and administrative expenses | 24,575 | 27,219 | 102,144 | 101,442 | |||||||||
| Total operating expenses | 56,168 | 48,795 | 200,333 | 174,690 | |||||||||
| Income from operations | 5,170 | 17,259 | 27,459 | 40,284 | |||||||||
| Other (expense) income, net | 1,307 | 1,491 | (784 | ) | 4,261 | ||||||||
| Loss on remeasurement of warrant liability | — | — | — | — | |||||||||
| Pretax income | 6,477 | 18,750 | 26,675 | 44,545 | |||||||||
| Provision for income taxes | 3,303 | 5,572 | 8,141 | 11,895 | |||||||||
| Net income | 3,174 | 13,178 | 18,534 | 32,650 | |||||||||
| Net income attributable to noncontrolling interests | 128 | 703 | 1,303 | 3,414 | |||||||||
| Net income attributable to Landsea Homes Corporation | $ | 3,046 | $ | 12,475 | $ | 17,231 | $ | 29,236 | |||||
| Earnings per share: | |||||||||||||
| Basic | $ | 0.08 | $ | 0.33 | $ | 0.48 | $ | 0.75 | |||||
| Diluted | $ | 0.08 | $ | 0.33 | $ | 0.47 | $ | 0.75 | |||||
| Weighted average shares outstanding: | |||||||||||||
| Basic | 36,289,952 | 37,349,364 | 36,262,257 | 38,885,003 | |||||||||
| Diluted | 36,559,557 | 37,537,270 | 36,556,070 | 39,076,322 | |||||||||
Home Deliveries and Home Sales Revenue
| Three Months Ended December 31, | |||||||||||||||||||||||
| 2024 | 2023 | % Change | |||||||||||||||||||||
| Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | |||||||||||||||
| (dollars in thousands) | |||||||||||||||||||||||
| Arizona | 250 | $ | 109,277 | $ | 437 | 162 | $ | 70,629 | $ | 436 | 54% | 55% | —% | ||||||||||
| California | 123 | 93,580 | 761 | 199 | 169,183 | 850 | (38)% | (45)% | (10)% | ||||||||||||||
| Colorado | 37 | 16,320 | 441 | 11 | 7,410 | 674 | 236% | 120% | (35)% | ||||||||||||||
| Florida | 338 | 157,971 | 467 | 292 | 132,446 | 454 | 16% | 19% | 3% | ||||||||||||||
| Metro New York | — | — | N/A | — | — | N/A | N/A | N/A | N/A | ||||||||||||||
| Texas | 189 | 73,406 | 388 | — | — | N/A | N/A | N/A | N/A | ||||||||||||||
| Total | 937 | $ | 450,554 | $ | 481 | 664 | $ | 379,668 | $ | 572 | 41% | 19% | (16)% | ||||||||||
| Year Ended December 31, | |||||||||||||||||||||
| 2024 | 2023 | % Change | |||||||||||||||||||
| Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | |||||||||||||
| (dollars in thousands) | |||||||||||||||||||||
| Arizona | 838 | $ | 369,602 | $ | 441 | 607 | $ | 264,067 | $ | 435 | 38% | 40% | 1% | ||||||||
| California | 518 | 456,585 | 881 | 514 | 439,939 | 856 | 1% | 4% | 3% | ||||||||||||
| Colorado | 118 | 54,256 | 460 | 11 | 7,410 | 674 | 973% | 632% | (32)% | ||||||||||||
| Florida | 942 | 433,104 | 460 | 986 | 452,608 | 459 | (4)% | (4)% | —% | ||||||||||||
| Metro New York | 1 | 4,475 | 4,475 | 1 | 1,649 | 1,649 | —% | 171% | 171% | ||||||||||||
| Texas | 414 | 168,916 | 408 | 4 | 4,194 | 1,049 | 10,250% | 3,928% | (61)% | ||||||||||||
| Total | 2,831 | $ | 1,486,938 | $ | 525 | 2,123 | $ | 1,169,867 | $ | 551 | 33% | 27% | (5)% | ||||||||
Net New Home Orders, Dollar Value of Orders, and Monthly Absorption Rates
| Three Months Ended December 31, | ||||||||||||||||||
| 2024 | 2023 | % Change | ||||||||||||||||
| Homes | Dollar Value | ASP | Monthly Absorption Rate | Homes | Dollar Value | ASP | Monthly Absorption Rate | Homes | Dollar Value | ASP | Monthly Absorption Rate | |||||||
| (dollars in thousands) | ||||||||||||||||||
| Arizona | 168 | $ | 72,217 | $ | 430 | 3.1 | 124 | $ | 54,061 | $ | 436 | 2.2 | 35% | 34% | (1)% | 41% | ||
| California | 82 | 59,389 | 724 | 2.5 | 76 | 73,619 | 969 | 2.5 | 8% | (19)% | (25)% | —% | ||||||
| Colorado | 29 | 12,867 | 444 | 3.2 | 2 | 1,286 | 643 | 0.7 | 1,350% | 901% | (31)% | 357% | ||||||
| Florida | 192 | 83,707 | 436 | 2.4 | 196 | 89,926 | 459 | 2.2 | (2)% | (7)% | (5)% | 9% | ||||||
| Metro New York | — | — | N/A | — | — | — | N/A | — | N/A | N/A | N/A | N/A | ||||||
| Texas | 165 | 61,656 | 374 | 2.8 | — | — | N/A | — | N/A | N/A | N/A | N/A | ||||||
| Total | 636 | $ | 289,836 | $ | 456 | 2.7 | 398 | $ | 218,892 | $ | 550 | 2.2 | 60% | 32% | (17)% | 23% | ||
| Year Ended December 31, | ||||||||||||||||||
| 2024 | 2023 | % Change | ||||||||||||||||
| Homes | Dollar Value | ASP | Monthly Absorption Rate | Homes | Dollar Value | ASP | Monthly Absorption Rate | Homes | Dollar Value | ASP | Monthly Absorption Rate | |||||||
| (dollars in thousands) | ||||||||||||||||||
| Arizona | 812 | $ | 361,869 | $ | 446 | 3.4 | 598 | $ | 255,513 | $ | 427 | 2.9 | 36% | 42% | 4% | 17% | ||
| California | 387 | 323,892 | 837 | 3.2 | 596 | 519,664 | 872 | 4.4 | (35)% | (38)% | (4)% | (27)% | ||||||
| Colorado (1) | 110 | 50,120 | 456 | 3.3 | 2 | 1,286 | 643 | 0.7 | 5,400% | 3,797% | (29)% | 371% | ||||||
| Florida | 923 | 429,902 | 466 | 2.6 | 747 | 330,195 | 442 | 2.1 | 24% | 30% | 5% | 24% | ||||||
| Metro New York | 1 | 4,475 | 4,475 | — | — | — | — | — | N/A | N/A | N/A | N/A | ||||||
| Texas | 401 | 158,331 | 395 | 2.2 | 4 | 4,194 | 1,049 | 1.1 | 9,925% | 3,675% | (62)% | 100% | ||||||
| Total | 2,634 | $ | 1,328,589 | $ | 504 | 2.8 | 1,947 | $ | 1,110,852 | $ | 571 | 2.8 | 35% | 20% | (12)% | —% | ||
| (1) The monthly absorption rates calculation for Colorado in 2023 is based on three months, for the time subsequent to the acquisition of Richfield in October 2023. | ||||||||||||||||||
Average Selling Communities
| Three Months Ended December 31, | Year Ended December 31, | |||||||
| 2024 | 2023 | % Change | 2024 | 2023 | % Change | |||
| Arizona | 18.0 | 19.0 | (5)% | 19.8 | 17.3 | 14% | ||
| California | 11.0 | 10.0 | 10% | 10.1 | 11.3 | (11)% | ||
| Colorado (1) | 3.0 | 1.0 | 200% | 2.8 | 1.0 | 180% | ||
| Florida | 27.0 | 30.0 | (10)% | 29.1 | 29.7 | (2)% | ||
| Metro New York(2) | — | — | N/A | — | — | N/A | ||
| Texas | 19.7 | — | N/A | 15.5 | 0.3 | 5,067% | ||
| Total | 78.7 | 60.0 | 31% | 77.2 | 58.8 | 31% | ||
| (1) The full year average selling communities calculation for Colorado in 2023 is based on three months, for the time subsequent to the acquisition of Richfield in October 2023. | ||||||||
| (2) Our Metro New York segment includes one project with only one residential unit and a retail space remaining to sell and deliver. Therefore we do not consider it to have any active selling communities. | ||||||||
Backlog
| December 31, 2024 | December 31, 2023 | % Change | |||||||||||||||||||
| Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | |||||||||||||
| (dollars in thousands) | |||||||||||||||||||||
| Arizona | 70 | $ | 33,700 | $ | 481 | 96 | $ | 41,433 | $ | 432 | (27)% | (19)% | 11% | ||||||||
| California | 30 | 25,477 | 849 | 161 | 158,170 | 982 | (81)% | (84)% | (14)% | ||||||||||||
| Colorado | 6 | 3,404 | 567 | 14 | 7,540 | 539 | (57)% | (55)% | 5% | ||||||||||||
| Florida | 227 | 125,282 | 552 | 246 | 128,484 | 522 | (8)% | (2)% | 6% | ||||||||||||
| Metro New York | — | — | N/A | — | — | N/A | N/A | N/A | N/A | ||||||||||||
| Texas(1) | 57 | 24,533 | 430 | — | — | N/A | N/A | N/A | N/A | ||||||||||||
| Total | 390 | $ | 212,396 | $ | 545 | 517 | $ | 335,627 | $ | 649 | (25)% | (37)% | (16)% | ||||||||
| (1) Backlog acquired in Texas at the date of the Antares acquisition was 70 homes with a value of $35,118 thousand. | |||||||||||||||||||||
Lots Owned or Controlled
| December 31, 2024 | December 31, 2023 | ||||||||
| Lots Owned | Lots Controlled | Total | Lots Owned | Lots Controlled | Total | % Change | |||
| Arizona | 1,210 | 1,633 | 2,843 | 1,688 | 1,662 | 3,350 | (15)% | ||
| California | 683 | 938 | 1,621 | 657 | 1,422 | 2,079 | (22)% | ||
| Colorado | 204 | 259 | 463 | 127 | 155 | 282 | 64% | ||
| Florida | 1,414 | 1,487 | 2,901 | 1,964 | 1,649 | 3,613 | (20)% | ||
| Metro New York | 1 | — | 1 | 2 | — | 2 | (50)% | ||
| Texas | 1,310 | 1,805 | 3,115 | 130 | 1,720 | 1,850 | 68% | ||
| Total | 4,822 | 6,122 | 10,944 | 4,568 | 6,608 | 11,176 | (2)% | ||
Home Sales Gross Margins
Home sales gross margin measures the price achieved on delivered homes compared to the costs needed to build the home. In the following table, we calculate gross margins adjusting for interest in cost of sales, inventory impairments, and purchase price accounting for acquired work in process inventory. This non-GAAP financial measure should not be used as a substitute for the Company's operating results in accordance with GAAP. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. We believe the below information is meaningful as it isolates the impact that indebtedness, impairments, and acquisitions have on our gross margins and allows for comparability to previous periods and competitors.
| Three Months Ended December 31, | |||||||||||
| 2024 | % | 2023 | % | ||||||||
| (dollars in thousands) | |||||||||||
| Home sales revenue | $ | 450,554 | 100.0 | % | $ | 379,668 | 100.0 | % | |||
| Cost of home sales | 394,244 | 87.5 | % | 319,392 | 84.1 | % | |||||
| Home sales gross margin | 56,310 | 12.5 | % | 60,276 | 15.9 | % | |||||
| Add: Interest in cost of home sales | 18,823 | 4.2 | % | 14,045 | 3.7 | % | |||||
| Add: Real estate inventories impairments | — | — | % | — | — | % | |||||
| Adjusted home sales gross margin excluding interest and inventory impairments | 75,133 | 16.7 | % | 74,321 | 19.6 | % | |||||
| Add: Purchase price accounting for acquired inventory | 7,890 | 1.8 | % | 4,760 | 1.3 | % | |||||
| Adjusted home sales gross margin excluding interest, inventory impairments, and purchase price accounting for acquired inventory | $ | 83,023 | 18.4 | % | $ | 79,081 | 20.8 | % | |||
| Year Ended December 31, | |||||||||||
| 2024 | % | 2023 | % | ||||||||
| (dollars in thousands) | |||||||||||
| Home sales revenue | $ | 1,486,938 | 100.0 | % | $ | 1,169,867 | 100.0 | % | |||
| Cost of home sales | 1,268,968 | 85.3 | % | 967,034 | 82.7 | % | |||||
| Home sales gross margin | 217,970 | 14.7 | % | 202,833 | 17.3 | % | |||||
| Add: Interest in cost of home sales | 58,739 | 4.0 | % | 35,576 | 3.0 | % | |||||
| Add: Real estate inventories impairments | 800 | 0.1 | % | 4,700 | 0.4 | % | |||||
| Adjusted home sales gross margin excluding interest and inventory impairments | 277,509 | 18.7 | % | 243,109 | 20.8 | % | |||||
| Add: Purchase price accounting for acquired inventory | 24,569 | 1.7 | % | 18,820 | 1.6 | % | |||||
| Adjusted home sales gross margin excluding interest, inventory impairments, and purchase price accounting for acquired inventory | $ | 302,078 | 20.3 | % | $ | 261,929 | 22.4 | % | |||
EBITDA and Adjusted EBITDA
The following tables present EBITDA and Adjusted EBITDA for the three months and years ended December 31, 2024 and 2023. Adjusted EBITDA is a non-GAAP financial measure used by management in evaluating operating performance. We define Adjusted EBITDA as net income before (i) income tax expense, (ii) interest expenses, (iii) depreciation and amortization, (iv) real estate inventories impairment and abandoned project costs, (v) purchase accounting adjustments for acquired work in process inventory related to business combinations, (vi) loss on debt modification, (vii) transaction costs related to business combinations, and (viii) write-off of deferred offering costs. We believe Adjusted EBITDA provides an indicator of general economic performance that is not affected by fluctuations in interest, effective tax rates, levels of depreciation and amortization, and items considered to be non-recurring. Accordingly, we believe this measure is useful for comparing our core operating performance from period to period.
Our presentation of Adjusted EBITDA should not be considered as an indication that our future results will be unaffected by unusual or non-recurring items.
| Three Months Ended December 31, | ||||||
| 2024 | 2023 | |||||
| (dollars in thousands) | ||||||
| Net income | $ | 3,174 | $ | 13,178 | ||
| Provision for income taxes | 3,303 | 5,572 | ||||
| Interest in cost of sales | 18,729 | 14,452 | ||||
| Depreciation and amortization expense | 2,067 | 1,326 | ||||
| EBITDA | 27,273 | 34,528 | ||||
| Real estate inventories impairments and abandoned project costs | 214 | 253 | ||||
| Purchase price accounting for acquired inventory | 7,890 | 4,760 | ||||
| Transaction costs | 2,534 | 757 | ||||
| Write-off of offering costs | 729 | — | ||||
| Adjusted EBITDA | $ | 38,640 | $ | 40,298 | ||
| Year Ended December 31, | ||||||
| 2024 | 2023 | |||||
| (dollars in thousands) | ||||||
| Net income | $ | 18,534 | $ | 32,650 | ||
| Provision for income taxes | 8,141 | 11,895 | ||||
| Interest in cost of sales | 60,953 | 36,330 | ||||
| Depreciation and amortization expense | 7,366 | 5,104 | ||||
| EBITDA | 94,994 | 85,979 | ||||
| Real estate inventories impairments and abandoned project costs | 2,916 | 5,698 | ||||
| Purchase price accounting for acquired inventory | 24,569 | 18,820 | ||||
| Transaction costs | 7,787 | 1,390 | ||||
| Write-off of offering costs | 729 | 436 | ||||
| Loss on debt modification | 5,180 | — | ||||
| Adjusted EBITDA | $ | 136,175 | $ | 112,323 | ||
Adjusted Net Income
Adjusted Net Income to Landsea Homes is a non-GAAP financial measure that we believe is useful to management, investors and other users of our financial information in evaluating and understanding our operating results without the effect of certain expenses that were historically pushed down by our parent company at the time and other non-recurring items. We believe excluding these items provides a more comparable assessment of our financial results from period to period. Adjusted Net Income to Landsea Homes is calculated by excluding the effects of related party interest that was pushed down by our prior parent company, purchase accounting adjustments for acquired work in process inventory related to business combinations, loss on debt modification, and real estate inventories impairment, and tax-effected using a blended statutory tax rate. Beginning in the year ended December 31, 2024, we began adjusting for abandoned project costs as a write-off of real estate inventories similar to real estate inventories impairment. We adjusted the prior period presented to maintain comparability between the periods. We adjust for the expense of related party interest pushed down from our prior parent company as we have no obligation to repay the debt and related interest.
| Three Months Ended December 31, | ||||||
| 2024 | 2023 | |||||
| (dollars in thousands, except share and per share amounts) | ||||||
| Net income attributable to Landsea Homes Corporation | $ | 3,046 | $ | 12,475 | ||
| Real estate inventories impairment and abandoned project costs | 214 | 253 | ||||
| Pre-Merger capitalized related party interest included in cost of sales | 24 | 131 | ||||
| Purchase price accounting for acquired inventory | 7,890 | 4,760 | ||||
| Total adjustments | 8,128 | 5,144 | ||||
| Tax-effected adjustments (1) | 6,055 | 3,796 | ||||
| Adjusted net income attributable to Landsea Homes Corporation | $ | 9,101 | $ | 16,271 | ||
| Earnings per share | ||||||
| Basic | $ | 0.08 | $ | 0.33 | ||
| Diluted | $ | 0.08 | $ | 0.33 | ||
| Adjusted earnings per share | ||||||
| Basic | $ | 0.25 | $ | 0.44 | ||
| Diluted | $ | 0.25 | $ | 0.43 | ||
| Weighted shares outstanding | ||||||
| Weighted average common shares outstanding used in EPS - basic | 36,289,952 | 37,349,364 | ||||
| Weighted average common shares outstanding used in EPS - diluted | 36,559,557 | 37,537,270 | ||||
| (1) Our tax-effected adjustments are based on our federal rate and a blended state rate adjusted for certain discrete items. | ||||||
| Year Ended December 31, | ||||||
| 2024 | 2023 | |||||
| (dollars in thousands, except share and per share amounts) | ||||||
| Net income attributable to Landsea Homes Corporation | $ | 17,231 | $ | 29,236 | ||
| Real estate inventories impairment and abandoned project costs | 2,916 | 5,698 | ||||
| Pre-Merger capitalized related party interest included in cost of sales | 153 | 1,718 | ||||
| Purchase price accounting for acquired inventory | 24,569 | 18,820 | ||||
| Loss on debt modification | 5,180 | — | ||||
| Total adjustments | 32,818 | 26,236 | ||||
| Tax-effected adjustments (1) | 24,448 | 19,358 | ||||
| Adjusted net income attributable to Landsea Homes Corporation | $ | 41,679 | $ | 48,594 | ||
| Earnings per share | ||||||
| Basic | $ | 0.48 | $ | 0.75 | ||
| Diluted | $ | 0.47 | $ | 0.75 | ||
| Adjusted earnings per share | ||||||
| Basic | $ | 1.15 | $ | 1.25 | ||
| Diluted | $ | 1.14 | $ | 1.24 | ||
| Weighted shares outstanding | ||||||
| Weighted average common shares outstanding used in EPS - basic | 36,262,257 | 38,885,003 | ||||
| Weighted average common shares outstanding used in EPS - diluted | 36,556,070 | 39,076,322 | ||||
| (1) Our tax-effected adjustments are based on our federal rate and a blended state rate adjusted for certain discrete items. | ||||||
Net Debt to Total Capital
The following table presents the ratio of debt to capital as well as the ratio of net debt to total capital which is a non-GAAP financial measure. The ratio of debt to capital is computed as the quotient obtained by dividing total debt, net of issuance costs, by total capital (sum of total debt, net of issuance costs, plus total equity).
The non-GAAP ratio of net debt to total capital is computed as the quotient obtained by dividing net debt (which is total debt, net of issuance costs, less cash, cash equivalents as well as cash held in escrow to the extent necessary to reduce the debt balance to zero) by total capital. The most comparable GAAP financial measure is the ratio of debt to capital. We believe the ratio of net debt to total capital is a relevant financial measure for investors to understand the leverage employed in our operations and as an indicator of our ability to obtain financing. We believe that by deducting our cash from our debt, we provide a measure of our indebtedness that takes into account our cash liquidity. We believe this provides useful information as the ratio of debt to capital does not take into account our liquidity and we believe that the ratio of net debt to total capital provides supplemental information by which our financial position may be considered.
See table below reconciling this non-GAAP measure to the ratio of debt to capital.
| December 31, | |||||||
| 2024 | 2023 | ||||||
| (dollars in thousands) | |||||||
| Total notes and other debts payable, net | $ | 725,354 | $ | 543,774 | |||
| Total equity | 676,109 | 688,352 | |||||
| Total capital | $ | 1,401,463 | $ | 1,232,126 | |||
| Ratio of debt to capital | 51.8 | % | 44.1 | % | |||
| Total notes and other debts payable, net | $ | 725,354 | $ | 543,774 | |||
| Less: cash and cash equivalents | 53,322 | 119,555 | |||||
| Less: cash held in escrow | 3,921 | 49,091 | |||||
| Net debt | $ | 668,111 | $ | 375,128 | |||
| Total capital | $ | 1,401,463 | $ | 1,232,126 | |||
| Ratio of net debt to total capital | 47.7 | % | 30.4 | % | |||
Released February 27, 2025