ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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75-2386963
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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301 Commerce Street, Suite 500,
Fort Worth, Texas
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76102
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
ý
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Accelerated filer
¨
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Non-accelerated filer
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
¨
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Page
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March 31,
2015 |
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September 30,
2014 |
||||
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(In millions)
(Unaudited)
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||||||
ASSETS
|
|
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|
||||
Homebuilding:
|
|
|
|
||||
Cash and cash equivalents
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$
|
665.8
|
|
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$
|
632.5
|
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Restricted cash
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10.4
|
|
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10.0
|
|
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Inventories:
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|
|
|
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Construction in progress and finished homes
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3,915.8
|
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3,541.3
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Residential land and lots — developed and under development
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3,928.3
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3,800.0
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Land held for development
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271.3
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332.8
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|
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Land held for sale
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21.5
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26.4
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|
||
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8,136.9
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|
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7,700.5
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Deferred income taxes, net of valuation allowance of
$30.9 million and $31.1 million at March 31, 2015 and September 30, 2014, respectively
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547.7
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565.0
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Property and equipment, net
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193.8
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190.8
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Other assets
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442.4
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441.1
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Goodwill
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94.8
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94.8
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10,091.8
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9,634.7
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Financial Services:
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Cash and cash equivalents
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31.9
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29.3
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Mortgage loans held for sale
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517.6
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476.9
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|
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Other assets
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71.8
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61.6
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|
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621.3
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567.8
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Total assets
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$
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10,713.1
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$
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10,202.5
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LIABILITIES
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|
||||
Homebuilding:
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|
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|
||||
Accounts payable
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$
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451.9
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$
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480.3
|
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Accrued expenses and other liabilities
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847.7
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875.0
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Notes payable
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3,548.0
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3,323.6
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4,847.6
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4,678.9
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Financial Services:
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Accounts payable and other liabilities
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47.0
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44.7
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Mortgage repurchase facility
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397.5
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359.2
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444.5
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403.9
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Total liabilities
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5,292.1
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5,082.8
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Commitments and contingencies (Note K)
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EQUITY
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Preferred stock, $.10 par value, 30,000,000 shares authorized, no shares issued
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—
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—
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Common stock, $.01 par value, 1,000,000,000 shares authorized, 373,741,449 shares issued and 366,541,378 shares outstanding at March 31, 2015 and 371,786,765 shares issued and 364,586,694 shares outstanding at September 30, 2014
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3.7
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3.7
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Additional paid-in capital
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2,671.3
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2,613.7
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Retained earnings
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2,875.2
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|
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2,630.5
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Treasury stock, 7,200,071 shares at March 31, 2015 and September 30, 2014, at cost
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(134.3
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)
|
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(134.3
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)
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Accumulated other comprehensive income
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2.2
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|
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2.2
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Total stockholders’ equity
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5,418.1
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5,115.8
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Noncontrolling interests
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2.9
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3.9
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Total equity
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5,421.0
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5,119.7
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Total liabilities and equity
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$
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10,713.1
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$
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10,202.5
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Three Months Ended
March 31, |
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Six Months Ended
March 31, |
||||||||||||
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2015
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2014
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2015
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2014
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||||||||
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(In millions, except per share data)
(Unaudited)
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||||||||||||||
Homebuilding:
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||||||||
Revenues:
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Home sales
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$
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2,318.8
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$
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1,680.0
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$
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4,559.4
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$
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3,310.8
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Land/lot sales and other
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19.7
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16.6
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32.1
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21.5
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2,338.5
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1,696.6
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4,591.5
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3,332.3
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Cost of sales:
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||||||||
Home sales
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1,861.9
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1,302.8
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3,659.9
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2,569.5
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Land/lot sales and other
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17.6
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12.6
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28.0
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16.9
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|
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Inventory and land option charges
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12.5
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4.4
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18.6
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7.1
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||||
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1,892.0
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1,319.8
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3,706.5
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2,593.5
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Gross profit:
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||||||||
Home sales
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456.9
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377.2
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899.5
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741.3
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Land/lot sales and other
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2.1
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4.0
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4.1
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4.6
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Inventory and land option charges
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(12.5
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)
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(4.4
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)
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(18.6
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)
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(7.1
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)
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||||
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446.5
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376.8
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885.0
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738.8
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Selling, general and administrative expense
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242.4
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187.9
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480.4
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371.3
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Other (income)
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(4.5
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)
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(2.8
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)
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(10.1
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)
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(6.1
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)
|
||||
Homebuilding pre-tax income
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208.6
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191.7
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414.7
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373.6
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Financial Services:
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||||||||
Revenues, net of recourse expense
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59.5
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38.4
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109.2
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73.3
|
|
||||
General and administrative expense
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40.7
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30.2
|
|
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78.6
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60.0
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|
||||
Interest and other (income)
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(2.7
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)
|
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(2.0
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)
|
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(5.5
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)
|
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(4.7
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)
|
||||
Financial services pre-tax income
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21.5
|
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10.2
|
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36.1
|
|
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18.0
|
|
||||
Income before income taxes
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230.1
|
|
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201.9
|
|
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450.8
|
|
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391.6
|
|
||||
Income tax expense
|
82.2
|
|
|
70.9
|
|
|
160.4
|
|
|
137.5
|
|
||||
Net income
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$
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147.9
|
|
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$
|
131.0
|
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$
|
290.4
|
|
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$
|
254.1
|
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Other comprehensive income, net of income tax:
|
|
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|
|
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||||||||
Unrealized gain related to debt securities collateralized by residential real estate
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—
|
|
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0.3
|
|
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—
|
|
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0.3
|
|
||||
Comprehensive income
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$
|
147.9
|
|
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$
|
131.3
|
|
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$
|
290.4
|
|
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$
|
254.4
|
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Basic net income per common share
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$
|
0.40
|
|
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$
|
0.40
|
|
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$
|
0.79
|
|
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$
|
0.79
|
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Net income per common share assuming dilution
|
$
|
0.40
|
|
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$
|
0.38
|
|
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$
|
0.79
|
|
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$
|
0.73
|
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Cash dividends declared per common share
|
$
|
0.0625
|
|
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$
|
0.0375
|
|
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$
|
0.125
|
|
|
$
|
0.0375
|
|
|
Six Months Ended
March 31, |
||||||
|
2015
|
|
2014
|
||||
|
(In millions)
(Unaudited)
|
||||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
290.4
|
|
|
$
|
254.1
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
25.4
|
|
|
16.7
|
|
||
Amortization of discounts and fees
|
2.7
|
|
|
20.8
|
|
||
Stock based compensation expense
|
22.4
|
|
|
10.8
|
|
||
Excess income tax benefit from employee stock awards
|
(6.7
|
)
|
|
(1.9
|
)
|
||
Deferred income taxes
|
17.4
|
|
|
16.7
|
|
||
Inventory and land option charges
|
18.6
|
|
|
7.1
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Increase in construction in progress and finished homes
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(375.6
|
)
|
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(336.4
|
)
|
||
Increase in residential land and lots –
developed, under development, held for development and held for sale
|
(71.2
|
)
|
|
(226.8
|
)
|
||
(Increase) decrease in other assets
|
(11.1
|
)
|
|
40.2
|
|
||
(Increase) decrease in mortgage loans held for sale
|
(40.7
|
)
|
|
52.6
|
|
||
Decrease in accounts payable, accrued expenses and other liabilities
|
(40.4
|
)
|
|
(119.7
|
)
|
||
Net cash used in operating activities
|
(168.8
|
)
|
|
(265.8
|
)
|
||
INVESTING ACTIVITIES
|
|
|
|
||||
Purchases of property and equipment
|
(24.0
|
)
|
|
(32.8
|
)
|
||
Increase in restricted cash
|
(0.4
|
)
|
|
(2.0
|
)
|
||
Net principal increase of other mortgage loans and real estate owned
|
(4.9
|
)
|
|
(1.7
|
)
|
||
Payments related to acquisition of a business
|
—
|
|
|
(34.5
|
)
|
||
Net cash used in investing activities
|
(29.3
|
)
|
|
(71.0
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
||||
Proceeds from notes payable
|
1,350.3
|
|
|
497.0
|
|
||
Repayment of notes payable
|
(1,098.3
|
)
|
|
(163.6
|
)
|
||
Proceeds from stock associated with certain employee benefit plans
|
21.0
|
|
|
29.6
|
|
||
Excess income tax benefit from employee stock awards
|
6.7
|
|
|
1.9
|
|
||
Cash dividends paid
|
(45.7
|
)
|
|
(12.1
|
)
|
||
Net cash provided by financing activities
|
234.0
|
|
|
352.8
|
|
||
INCREASE IN CASH AND CASH EQUIVALENTS
|
35.9
|
|
|
16.0
|
|
||
Cash and cash equivalents at beginning of period
|
661.8
|
|
|
977.4
|
|
||
Cash and cash equivalents at end of period
|
$
|
697.7
|
|
|
$
|
993.4
|
|
Supplemental disclosures of non-cash activities:
|
|
|
|
||||
Notes payable issued for inventory
|
$
|
8.1
|
|
|
$
|
—
|
|
Stock issued under employee incentive plans
|
$
|
8.3
|
|
|
$
|
5.5
|
|
|
East:
|
|
Delaware, Georgia (Savannah only), Maryland, New Jersey, North Carolina, Pennsylvania, South Carolina and Virginia
|
|
Midwest:
|
|
Colorado, Illinois, Indiana and Minnesota
|
|
Southeast:
|
|
Alabama, Florida, Georgia, Mississippi and Tennessee
|
|
South Central:
|
|
Louisiana, Oklahoma and Texas
|
|
Southwest:
|
|
Arizona and New Mexico
|
|
West:
|
|
California, Hawaii, Nevada, Oregon, Utah and Washington
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
||||||||
Homebuilding revenues:
|
|
|
|
|
|
|
|
|
||||||||
East
|
|
$
|
280.7
|
|
|
$
|
203.2
|
|
|
$
|
579.5
|
|
|
$
|
393.3
|
|
Midwest
|
|
145.0
|
|
|
99.9
|
|
|
274.9
|
|
|
205.7
|
|
||||
Southeast
|
|
646.1
|
|
|
471.3
|
|
|
1,265.5
|
|
|
918.7
|
|
||||
South Central
|
|
628.2
|
|
|
430.4
|
|
|
1,207.9
|
|
|
851.5
|
|
||||
Southwest
|
|
70.9
|
|
|
63.1
|
|
|
146.3
|
|
|
133.8
|
|
||||
West
|
|
567.6
|
|
|
428.7
|
|
|
1,117.4
|
|
|
829.3
|
|
||||
Homebuilding revenues
|
|
2,338.5
|
|
|
1,696.6
|
|
|
4,591.5
|
|
|
3,332.3
|
|
||||
Financial services revenues
|
|
59.5
|
|
|
38.4
|
|
|
109.2
|
|
|
73.3
|
|
||||
Total revenues
|
|
$
|
2,398.0
|
|
|
$
|
1,735.0
|
|
|
$
|
4,700.7
|
|
|
$
|
3,405.6
|
|
Inventory Impairments
|
|
|
|
|
|
|
|
|
||||||||
East
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Midwest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Southeast
|
|
7.3
|
|
|
2.1
|
|
|
7.3
|
|
|
2.1
|
|
||||
South Central
|
|
0.7
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
||||
Southwest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
West
|
|
0.1
|
|
|
0.2
|
|
|
4.0
|
|
|
0.2
|
|
||||
Total inventory impairments
|
|
$
|
8.1
|
|
|
$
|
2.3
|
|
|
$
|
12.0
|
|
|
$
|
2.3
|
|
Income Before Income Taxes
(1)
|
|
|
|
|
|
|
|
|
||||||||
Homebuilding pre-tax income:
|
|
|
|
|
|
|
|
|
||||||||
East
|
|
$
|
13.0
|
|
|
$
|
14.2
|
|
|
$
|
39.4
|
|
|
$
|
25.7
|
|
Midwest
|
|
10.2
|
|
|
9.1
|
|
|
15.0
|
|
|
19.1
|
|
||||
Southeast
|
|
58.7
|
|
|
52.2
|
|
|
116.7
|
|
|
103.7
|
|
||||
South Central
|
|
65.1
|
|
|
46.6
|
|
|
126.2
|
|
|
89.0
|
|
||||
Southwest
|
|
1.2
|
|
|
5.5
|
|
|
3.1
|
|
|
11.5
|
|
||||
West
|
|
60.4
|
|
|
64.1
|
|
|
114.3
|
|
|
124.6
|
|
||||
Homebuilding pre-tax income
|
|
208.6
|
|
|
191.7
|
|
|
414.7
|
|
|
373.6
|
|
||||
Financial services pre-tax income
|
|
21.5
|
|
|
10.2
|
|
|
36.1
|
|
|
18.0
|
|
||||
Income before income taxes
|
|
$
|
230.1
|
|
|
$
|
201.9
|
|
|
$
|
450.8
|
|
|
$
|
391.6
|
|
(1)
|
Expenses maintained at the corporate level consist primarily of interest and property taxes, which are capitalized and amortized to cost of sales or expensed directly, and the expenses related to operating the Company’s corporate office. The amortization of capitalized interest and property taxes is allocated to each segment based on the segment’s cost of sales, while those expenses associated with the corporate office are allocated to each segment based on the segment’s inventory balances.
|
|
|
March 31,
2015 |
|
September 30,
2014 |
||||
|
|
(In millions)
|
||||||
Homebuilding Inventories
(1)
|
|
|
|
|
||||
East
|
|
$
|
888.5
|
|
|
$
|
842.7
|
|
Midwest
|
|
507.0
|
|
|
477.6
|
|
||
Southeast
|
|
2,030.4
|
|
|
1,943.0
|
|
||
South Central
|
|
1,927.7
|
|
|
1,742.5
|
|
||
Southwest
|
|
290.6
|
|
|
292.9
|
|
||
West
|
|
2,240.0
|
|
|
2,169.4
|
|
||
Corporate and unallocated (2)
|
|
252.7
|
|
|
232.4
|
|
||
Total homebuilding inventory
|
|
$
|
8,136.9
|
|
|
$
|
7,700.5
|
|
(1)
|
Homebuilding inventories are the only assets included in the measure of homebuilding segment assets used by the Company’s chief operating decision makers.
|
(2)
|
Corporate and unallocated consists primarily of capitalized interest and property taxes.
|
|
|
March 31,
2015 |
|
September 30,
2014 |
||||
|
|
(In millions)
|
||||||
Homebuilding:
|
|
|
|
|
||||
Unsecured:
|
|
|
|
|
||||
Revolving credit facility, maturing 2019
|
|
$
|
175.0
|
|
|
$
|
300.0
|
|
5.25% senior notes due 2015, net
|
|
—
|
|
|
157.7
|
|
||
5.625% senior notes due 2016, net
|
|
170.0
|
|
|
169.9
|
|
||
6.5% senior notes due 2016, net
|
|
372.6
|
|
|
372.6
|
|
||
4.75% senior notes due 2017
|
|
350.0
|
|
|
350.0
|
|
||
3.625% senior notes due 2018
|
|
400.0
|
|
|
400.0
|
|
||
3.75% senior notes due 2019
|
|
500.0
|
|
|
500.0
|
|
||
4.0% senior notes due 2020
|
|
500.0
|
|
|
—
|
|
||
4.375% senior notes due 2022
|
|
350.0
|
|
|
350.0
|
|
||
4.75% senior notes due 2023
|
|
300.0
|
|
|
300.0
|
|
||
5.75% senior notes due 2023
|
|
400.0
|
|
|
400.0
|
|
||
Other secured notes
|
|
30.4
|
|
|
23.4
|
|
||
|
|
$
|
3,548.0
|
|
|
$
|
3,323.6
|
|
Financial Services:
|
|
|
|
|
||||
Mortgage repurchase facility, maturing 2016
|
|
$
|
397.5
|
|
|
$
|
359.2
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Capitalized interest, beginning of period
|
|
$
|
205.2
|
|
|
$
|
161.1
|
|
|
$
|
198.5
|
|
|
$
|
137.1
|
|
Interest incurred (1)
|
|
42.6
|
|
|
49.5
|
|
|
83.0
|
|
|
98.8
|
|
||||
Interest expensed:
|
|
|
|
|
|
|
|
|
||||||||
Charged to cost of sales
|
|
(35.6
|
)
|
|
(26.9
|
)
|
|
(69.2
|
)
|
|
(52.2
|
)
|
||||
Written off with inventory impairments
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
||||
Capitalized interest, end of period
|
|
$
|
212.2
|
|
|
$
|
183.7
|
|
|
$
|
212.2
|
|
|
$
|
183.7
|
|
(1)
|
Interest incurred includes interest incurred on the Company's financial services mortgage repurchase facility of
$1.6 million
and
$3.1 million
in the
three and six months
ended
March 31, 2015
, respectively, and
$0.9 million
and
$1.8 million
in the same periods of
2014
.
|
|
|
March 31,
2015 |
|
September 30,
2014 |
||||
|
|
(In millions)
|
||||||
Other mortgage loans
|
|
$
|
45.3
|
|
|
$
|
41.0
|
|
Real estate owned
|
|
0.5
|
|
|
0.7
|
|
||
|
|
$
|
45.8
|
|
|
$
|
41.7
|
|
|
|
March 31,
2015 |
|
September 30,
2014 |
||||
|
|
(In millions)
|
||||||
Loss reserves related to:
|
|
|
|
|
||||
Other mortgage loans
|
|
$
|
1.6
|
|
|
$
|
1.7
|
|
Real estate owned
|
|
0.1
|
|
|
0.1
|
|
||
Loan repurchase and settlement obligations – known and expected
|
|
21.7
|
|
|
24.4
|
|
||
|
|
$
|
23.4
|
|
|
$
|
26.2
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
147.9
|
|
|
$
|
131.0
|
|
|
$
|
290.4
|
|
|
$
|
254.1
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
||||||||
Interest and amortization of issuance costs associated with convertible senior notes, net of tax
|
|
—
|
|
|
6.9
|
|
|
—
|
|
|
13.7
|
|
||||
Numerator for diluted earnings per share after assumed conversions
|
|
$
|
147.9
|
|
|
$
|
137.9
|
|
|
$
|
290.4
|
|
|
$
|
267.8
|
|
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Denominator for basic earnings per share — weighted average common shares
|
|
365.8
|
|
|
324.3
|
|
|
365.4
|
|
|
323.7
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
||||||||
Employee stock awards
|
|
3.6
|
|
|
3.4
|
|
|
3.4
|
|
|
3.1
|
|
||||
Convertible senior notes
|
|
—
|
|
|
38.6
|
|
|
—
|
|
|
38.6
|
|
||||
Denominator for diluted earnings per share — adjusted weighted average common shares
|
|
369.4
|
|
|
366.3
|
|
|
368.8
|
|
|
365.4
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Basic net income per common share
|
|
$
|
0.40
|
|
|
$
|
0.40
|
|
|
$
|
0.79
|
|
|
$
|
0.79
|
|
Net income per common share assuming dilution
|
|
$
|
0.40
|
|
|
$
|
0.38
|
|
|
$
|
0.79
|
|
|
$
|
0.73
|
|
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
(In millions)
|
||||||||||||||
Warranty liability, beginning of period
|
|
$
|
65.9
|
|
|
$
|
56.7
|
|
|
$
|
65.7
|
|
|
$
|
56.9
|
|
Warranties issued
|
|
10.4
|
|
|
7.4
|
|
|
20.5
|
|
|
14.6
|
|
||||
Changes in liability for pre-existing warranties
|
|
2.8
|
|
|
1.1
|
|
|
0.6
|
|
|
2.1
|
|
||||
Settlements made
|
|
(7.5
|
)
|
|
(7.9
|
)
|
|
(15.2
|
)
|
|
(16.3
|
)
|
||||
Warranty liability, end of period
|
|
$
|
71.6
|
|
|
$
|
57.3
|
|
|
$
|
71.6
|
|
|
$
|
57.3
|
|
|
Six Months Ended
March 31, |
||||||
|
2015
|
|
2014
|
||||
|
(In millions)
|
||||||
Reserves for legal claims, beginning of period
|
$
|
456.9
|
|
|
$
|
482.0
|
|
Increase (decrease) in reserves
|
20.8
|
|
|
(17.4
|
)
|
||
Payments
|
(28.3
|
)
|
|
(10.4
|
)
|
||
Reserves for legal claims, end of period
|
$
|
449.4
|
|
|
$
|
454.2
|
|
|
|
March 31,
2015 |
|
September 30,
2014 |
||||
|
|
(In millions)
|
||||||
Insurance receivables
|
|
$
|
134.1
|
|
|
$
|
138.4
|
|
Earnest money and refundable deposits
|
|
121.0
|
|
|
113.3
|
|
||
Accounts and notes receivable
|
|
43.0
|
|
|
38.6
|
|
||
Prepaid assets
|
|
51.5
|
|
|
55.4
|
|
||
Rental properties
|
|
48.6
|
|
|
48.7
|
|
||
Debt securities collateralized by residential real estate
|
|
20.8
|
|
|
20.8
|
|
||
Other assets
|
|
23.4
|
|
|
25.9
|
|
||
|
|
$
|
442.4
|
|
|
$
|
441.1
|
|
|
|
March 31,
2015 |
|
September 30,
2014 |
||||
|
|
(In millions)
|
||||||
Reserves for legal claims
|
|
$
|
449.4
|
|
|
$
|
456.9
|
|
Employee compensation and related liabilities
|
|
144.2
|
|
|
150.8
|
|
||
Warranty liability
|
|
71.6
|
|
|
65.7
|
|
||
Accrued interest
|
|
31.0
|
|
|
29.1
|
|
||
Federal and state income tax liabilities
|
|
6.6
|
|
|
12.8
|
|
||
Inventory related accruals
|
|
29.7
|
|
|
36.1
|
|
||
Homebuyer deposits
|
|
54.8
|
|
|
49.5
|
|
||
Accrued property taxes
|
|
17.5
|
|
|
29.1
|
|
||
Other liabilities
|
|
42.9
|
|
|
45.0
|
|
||
|
|
$
|
847.7
|
|
|
$
|
875.0
|
|
•
|
Level 1 – Valuation is based on quoted prices in active markets for identical assets and liabilities.
|
•
|
Level 2 – Valuation is determined from quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar instruments in markets that are not active, or by model-based techniques in which all significant inputs are observable in the market. The Company’s assets and liabilities measured at fair value using Level 2 inputs on a recurring basis are as follows:
|
▪
|
mortgage loans held for sale;
|
▪
|
IRLCs; and
|
▪
|
loan sale commitments and hedging instruments.
|
•
|
Level 3 – Valuation is typically derived from model-based techniques in which at least one significant input is unobservable and based on the Company’s own estimates about the assumptions that market participants would use to value the asset or liability.
|
▪
|
debt securities collateralized by residential real estate; and
|
▪
|
a limited number of mortgage loans held for sale with some degree of impairment affecting their marketability.
|
▪
|
inventory held and used;
|
▪
|
inventory available for sale;
|
▪
|
certain other mortgage loans; and
|
▪
|
rental properties and real estate owned.
|
|
|
|
|
Fair Value at March 31, 2015
|
||||||||||||||
|
|
Balance Sheet Location
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
|
|
(In millions)
|
||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Debt securities collateralized by residential real estate (a)
|
|
Other assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20.8
|
|
|
$
|
20.8
|
|
Financial Services:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Mortgage loans held for sale (b)
|
|
Mortgage loans held for sale
|
|
—
|
|
|
504.2
|
|
|
13.4
|
|
|
517.6
|
|
||||
Derivatives not designated as hedging instruments (c):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate lock commitments
|
|
Other assets
|
|
—
|
|
|
4.6
|
|
|
—
|
|
|
4.6
|
|
||||
Forward sales of MBS
|
|
Other liabilities
|
|
—
|
|
|
(4.7
|
)
|
|
—
|
|
|
(4.7
|
)
|
||||
Best-efforts and mandatory commitments
|
|
Other liabilities
|
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
|
(0.5
|
)
|
|
|
|
|
Fair Value at September 30, 2014
|
||||||||||||||
|
|
Balance Sheet Location
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
|
|
(In millions)
|
||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Debt securities collateralized by residential real estate (a)
|
|
Other assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20.8
|
|
|
$
|
20.8
|
|
Financial Services:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Mortgage loans held for sale (b)
|
|
Mortgage loans held for sale
|
|
—
|
|
|
464.9
|
|
|
12.0
|
|
|
476.9
|
|
||||
Derivatives not designated as hedging instruments (c):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate lock commitments
|
|
Other assets
|
|
—
|
|
|
2.4
|
|
|
—
|
|
|
2.4
|
|
||||
Forward sales of MBS
|
|
Other liabilities
|
|
—
|
|
|
(1.9
|
)
|
|
—
|
|
|
(1.9
|
)
|
||||
Best-efforts and mandatory commitments
|
|
Other liabilities
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
Level 3 Assets at Fair Value for the
|
||||||||||||||||||||||||||
|
Six Months Ended March 31, 2015
|
||||||||||||||||||||||||||
|
Balance at September 30, 2014
|
|
Net realized and unrealized gains (losses)
|
|
Purchases
|
|
Sales and Settlements
|
|
Principal Reductions
|
|
Net transfers in (out)
of Level 3
|
|
Balance at March 31, 2015
|
||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||
Debt securities collateralized by residential real estate (a)
|
$
|
20.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20.8
|
|
Mortgage loans held for sale (b)
|
12.0
|
|
|
0.4
|
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
1.7
|
|
|
13.4
|
|
(a)
|
In October 2012, the Company purchased defaulted debt securities which are secured by residential real estate. These securities, which are included in other assets in the consolidated balance sheets, are classified as available for sale and are reflected at fair value. The fair value of these securities was determined by estimating the future cash flows of the securities and the residential real estate utilizing discount rates of
6%
and
18%
, respectively. Unrealized gains or losses on these securities, net of tax, are recorded in accumulated other comprehensive income (loss) in the consolidated balance sheets. The Company has entered into an agreement to purchase this residential real estate parcel and all additional defaulted debt securities associated with the parcel, in order to develop the property and build and sell homes. In April 2015, the Company completed this purchase transaction for
$19.6 million
in cash. The purchase price will be allocated to the land and the debt securities acquired in the third quarter of fiscal 2015.
|
(b)
|
Mortgage loans held for sale are reflected at fair value. Interest income earned on mortgage loans held for sale is based on contractual interest rates and included in financial services interest and other income. Mortgage loans held for sale at
March 31, 2015
includes
$13.4 million
of originated loans for which the Company elected the fair value option upon origination and which the Company has not sold into the secondary market, but plans to sell as market conditions permit. The fair value of these mortgage loans held for sale is generally calculated considering the secondary market and adjusted for the value of the underlying collateral, including interest rate risk, liquidity risk and prepayment risk.
|
(c)
|
Fair value measurements of these derivatives represent changes in fair value, as calculated by reference to quoted prices for similar assets, and are reflected in the balance sheet. Changes in these fair values during the periods presented are included in financial services revenues in the consolidated statements of operations.
|
|
|
|
|
Fair Value at March 31, 2015
|
|
Fair Value at September 30, 2014
|
||||
|
|
|
|
|
||||||
|
|
Balance Sheet Location
|
|
Level 3
|
|
Level 3
|
||||
|
|
|
|
(In millions)
|
||||||
Homebuilding:
|
|
|
|
|
|
|
||||
Inventory held and used (a) (b)
|
|
Inventories
|
|
$
|
21.6
|
|
|
$
|
19.2
|
|
Inventory available for sale (a) (c)
|
|
Inventories
|
|
1.4
|
|
|
8.2
|
|
||
Financial Services:
|
|
|
|
|
|
|
||||
Other mortgage loans (a) (d)
|
|
Other assets
|
|
14.6
|
|
|
16.0
|
|
||
Real estate owned (a) (d)
|
|
Other assets
|
|
0.2
|
|
|
0.5
|
|
(a)
|
The fair values included in the table above represent only those assets whose carrying values were adjusted to fair value in the respective quarter.
|
(b)
|
In performing its impairment analysis of communities, discount rates ranging from
12%
to
18%
were used in the periods presented.
|
(c)
|
The fair value of inventory available for sale was determined based on recent offers received from outside third parties, comparable sales or actual contracts.
|
(d)
|
The fair values of other mortgage loans and real estate owned are determined based on the value of the underlying collateral.
|
|
Carrying Value
|
|
Fair Value at March 31, 2015
|
||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
$
|
665.8
|
|
|
$
|
665.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
665.8
|
|
Restricted cash (a)
|
10.4
|
|
|
10.4
|
|
|
—
|
|
|
—
|
|
|
10.4
|
|
|||||
Revolving credit facility (a)
|
175.0
|
|
|
—
|
|
|
—
|
|
|
175.0
|
|
|
175.0
|
|
|||||
Senior notes (b)
|
3,342.6
|
|
|
—
|
|
|
3,432.9
|
|
|
—
|
|
|
3,432.9
|
|
|||||
Other secured notes (a)
|
30.4
|
|
|
—
|
|
|
—
|
|
|
30.4
|
|
|
30.4
|
|
|||||
Financial Services:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
31.9
|
|
|
31.9
|
|
|
—
|
|
|
—
|
|
|
31.9
|
|
|||||
Mortgage repurchase facility (a)
|
397.5
|
|
|
—
|
|
|
—
|
|
|
397.5
|
|
|
397.5
|
|
|
Carrying Value
|
|
Fair Value at September 30, 2014
|
||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
$
|
632.5
|
|
|
$
|
632.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
632.5
|
|
Restricted cash (a)
|
10.0
|
|
|
10.0
|
|
|
—
|
|
|
—
|
|
|
10.0
|
|
|||||
Revolving credit facility (a)
|
300.0
|
|
|
—
|
|
|
—
|
|
|
300.0
|
|
|
300.0
|
|
|||||
Senior notes (b)
|
3,000.2
|
|
|
—
|
|
|
3,033.8
|
|
|
—
|
|
|
3,033.8
|
|
|||||
Other secured notes (a)
|
23.4
|
|
|
—
|
|
|
—
|
|
|
23.4
|
|
|
23.4
|
|
|||||
Financial Services:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
29.3
|
|
|
29.3
|
|
|
—
|
|
|
—
|
|
|
29.3
|
|
|||||
Mortgage repurchase facility (a)
|
359.2
|
|
|
—
|
|
|
—
|
|
|
359.2
|
|
|
359.2
|
|
(a)
|
The fair value approximates carrying value due to its short-term nature, short maturity or floating interest rate terms, as applicable.
|
(b)
|
The fair value is determined based on quoted market prices of recent transactions of the notes, which is classified as Level 2 within the fair value hierarchy.
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
522.1
|
|
|
$
|
96.0
|
|
|
$
|
79.6
|
|
|
$
|
—
|
|
|
$
|
697.7
|
|
Restricted cash
|
|
7.0
|
|
|
2.3
|
|
|
1.1
|
|
|
—
|
|
|
10.4
|
|
|||||
Investments in subsidiaries
|
|
3,118.5
|
|
|
—
|
|
|
—
|
|
|
(3,118.5
|
)
|
|
—
|
|
|||||
Inventories
|
|
2,768.1
|
|
|
5,344.2
|
|
|
24.6
|
|
|
—
|
|
|
8,136.9
|
|
|||||
Deferred income taxes
|
|
178.5
|
|
|
358.5
|
|
|
10.7
|
|
|
—
|
|
|
547.7
|
|
|||||
Property and equipment, net
|
|
56.8
|
|
|
50.0
|
|
|
87.0
|
|
|
—
|
|
|
193.8
|
|
|||||
Other assets
|
|
168.6
|
|
|
246.8
|
|
|
98.8
|
|
|
—
|
|
|
514.2
|
|
|||||
Mortgage loans held for sale
|
|
—
|
|
|
—
|
|
|
517.6
|
|
|
—
|
|
|
517.6
|
|
|||||
Goodwill
|
|
—
|
|
|
94.8
|
|
|
—
|
|
|
—
|
|
|
94.8
|
|
|||||
Intercompany receivables
|
|
2,484.8
|
|
|
—
|
|
|
—
|
|
|
(2,484.8
|
)
|
|
—
|
|
|||||
Total Assets
|
|
$
|
9,304.4
|
|
|
$
|
6,192.6
|
|
|
$
|
819.4
|
|
|
$
|
(5,603.3
|
)
|
|
$
|
10,713.1
|
|
LIABILITIES & EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other liabilities
|
|
$
|
367.1
|
|
|
$
|
842.9
|
|
|
$
|
136.6
|
|
|
$
|
—
|
|
|
$
|
1,346.6
|
|
Intercompany payables
|
|
—
|
|
|
2,373.1
|
|
|
111.7
|
|
|
(2,484.8
|
)
|
|
—
|
|
|||||
Notes payable
|
|
3,519.2
|
|
|
10.6
|
|
|
415.7
|
|
|
—
|
|
|
3,945.5
|
|
|||||
Total Liabilities
|
|
3,886.3
|
|
|
3,226.6
|
|
|
664.0
|
|
|
(2,484.8
|
)
|
|
5,292.1
|
|
|||||
Total stockholders’ equity
|
|
5,418.1
|
|
|
2,966.0
|
|
|
152.5
|
|
|
(3,118.5
|
)
|
|
5,418.1
|
|
|||||
Noncontrolling interests
|
|
—
|
|
|
—
|
|
|
2.9
|
|
|
—
|
|
|
2.9
|
|
|||||
Total Equity
|
|
5,418.1
|
|
|
2,966.0
|
|
|
155.4
|
|
|
(3,118.5
|
)
|
|
5,421.0
|
|
|||||
Total Liabilities & Equity
|
|
$
|
9,304.4
|
|
|
$
|
6,192.6
|
|
|
$
|
819.4
|
|
|
$
|
(5,603.3
|
)
|
|
$
|
10,713.1
|
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
497.4
|
|
|
$
|
89.5
|
|
|
$
|
74.9
|
|
|
$
|
—
|
|
|
$
|
661.8
|
|
Restricted cash
|
|
6.8
|
|
|
2.1
|
|
|
1.1
|
|
|
—
|
|
|
10.0
|
|
|||||
Investments in subsidiaries
|
|
2,878.2
|
|
|
—
|
|
|
—
|
|
|
(2,878.2
|
)
|
|
—
|
|
|||||
Inventories
|
|
2,675.9
|
|
|
5,014.3
|
|
|
10.3
|
|
|
—
|
|
|
7,700.5
|
|
|||||
Deferred income taxes
|
|
189.9
|
|
|
364.4
|
|
|
10.7
|
|
|
—
|
|
|
565.0
|
|
|||||
Property and equipment, net
|
|
51.9
|
|
|
49.1
|
|
|
89.8
|
|
|
—
|
|
|
190.8
|
|
|||||
Other assets
|
|
163.0
|
|
|
250.8
|
|
|
88.9
|
|
|
—
|
|
|
502.7
|
|
|||||
Mortgage loans held for sale
|
|
—
|
|
|
—
|
|
|
476.9
|
|
|
—
|
|
|
476.9
|
|
|||||
Goodwill
|
|
—
|
|
|
94.8
|
|
|
—
|
|
|
—
|
|
|
94.8
|
|
|||||
Intercompany receivables
|
|
2,364.2
|
|
|
—
|
|
|
—
|
|
|
(2,364.2
|
)
|
|
—
|
|
|||||
Total Assets
|
|
$
|
8,827.3
|
|
|
$
|
5,865.0
|
|
|
$
|
752.6
|
|
|
$
|
(5,242.4
|
)
|
|
$
|
10,202.5
|
|
LIABILITIES & EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other liabilities
|
|
$
|
409.8
|
|
|
$
|
853.3
|
|
|
$
|
136.9
|
|
|
$
|
—
|
|
|
$
|
1,400.0
|
|
Intercompany payables
|
|
—
|
|
|
2,282.2
|
|
|
82.0
|
|
|
(2,364.2
|
)
|
|
—
|
|
|||||
Notes payable
|
|
3,301.7
|
|
|
3.4
|
|
|
377.7
|
|
|
—
|
|
|
3,682.8
|
|
|||||
Total Liabilities
|
|
3,711.5
|
|
|
3,138.9
|
|
|
596.6
|
|
|
(2,364.2
|
)
|
|
5,082.8
|
|
|||||
Total stockholders’ equity
|
|
5,115.8
|
|
|
2,726.1
|
|
|
152.1
|
|
|
(2,878.2
|
)
|
|
5,115.8
|
|
|||||
Noncontrolling interests
|
|
—
|
|
|
—
|
|
|
3.9
|
|
|
—
|
|
|
3.9
|
|
|||||
Total Equity
|
|
5,115.8
|
|
|
2,726.1
|
|
|
156.0
|
|
|
(2,878.2
|
)
|
|
5,119.7
|
|
|||||
Total Liabilities & Equity
|
|
$
|
8,827.3
|
|
|
$
|
5,865.0
|
|
|
$
|
752.6
|
|
|
$
|
(5,242.4
|
)
|
|
$
|
10,202.5
|
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
727.0
|
|
|
$
|
1,611.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,338.5
|
|
Cost of sales
|
|
593.7
|
|
|
1,297.8
|
|
|
0.5
|
|
|
—
|
|
|
1,892.0
|
|
|||||
Gross profit (loss)
|
|
133.3
|
|
|
313.7
|
|
|
(0.5
|
)
|
|
—
|
|
|
446.5
|
|
|||||
Selling, general and administrative expense
|
|
112.4
|
|
|
124.4
|
|
|
5.6
|
|
|
—
|
|
|
242.4
|
|
|||||
Equity in (income) of subsidiaries
|
|
(208.5
|
)
|
|
—
|
|
|
—
|
|
|
208.5
|
|
|
—
|
|
|||||
Other (income)
|
|
(0.7
|
)
|
|
(1.1
|
)
|
|
(2.7
|
)
|
|
—
|
|
|
(4.5
|
)
|
|||||
Homebuilding pre-tax income (loss)
|
|
230.1
|
|
|
190.4
|
|
|
(3.4
|
)
|
|
(208.5
|
)
|
|
208.6
|
|
|||||
Financial Services:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues, net of recourse expense
|
|
—
|
|
|
—
|
|
|
59.5
|
|
|
—
|
|
|
59.5
|
|
|||||
General and administrative expense
|
|
—
|
|
|
—
|
|
|
40.7
|
|
|
—
|
|
|
40.7
|
|
|||||
Interest and other (income)
|
|
—
|
|
|
—
|
|
|
(2.7
|
)
|
|
—
|
|
|
(2.7
|
)
|
|||||
Financial services pre-tax income
|
|
—
|
|
|
—
|
|
|
21.5
|
|
|
—
|
|
|
21.5
|
|
|||||
Income before income taxes
|
|
230.1
|
|
|
190.4
|
|
|
18.1
|
|
|
(208.5
|
)
|
|
230.1
|
|
|||||
Income tax expense
|
|
82.2
|
|
|
67.7
|
|
|
6.9
|
|
|
(74.6
|
)
|
|
82.2
|
|
|||||
Net income
|
|
$
|
147.9
|
|
|
$
|
122.7
|
|
|
$
|
11.2
|
|
|
$
|
(133.9
|
)
|
|
$
|
147.9
|
|
Comprehensive income
|
|
$
|
147.9
|
|
|
$
|
122.7
|
|
|
$
|
11.2
|
|
|
$
|
(133.9
|
)
|
|
$
|
147.9
|
|
|
|
D.R.
Horton, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
1,423.8
|
|
|
$
|
3,167.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,591.5
|
|
Cost of sales
|
|
1,147.7
|
|
|
2,554.9
|
|
|
3.9
|
|
|
—
|
|
|
3,706.5
|
|
|||||
Gross profit (loss)
|
|
276.1
|
|
|
612.8
|
|
|
(3.9
|
)
|
|
—
|
|
|
885.0
|
|
|||||
Selling, general and administrative expense
|
|
222.6
|
|
|
245.6
|
|
|
12.2
|
|
|
—
|
|
|
480.4
|
|
|||||
Equity in (income) of subsidiaries
|
|
(396.3
|
)
|
|
—
|
|
|
—
|
|
|
396.3
|
|
|
—
|
|
|||||
Other (income)
|
|
(1.0
|
)
|
|
(2.5
|
)
|
|
(6.6
|
)
|
|
—
|
|
|
(10.1
|
)
|
|||||
Homebuilding pre-tax income (loss)
|
|
450.8
|
|
|
369.7
|
|
|
(9.5
|
)
|
|
(396.3
|
)
|
|
414.7
|
|
|||||
Financial Services:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues, net of recourse expense
|
|
—
|
|
|
—
|
|
|
109.2
|
|
|
—
|
|
|
109.2
|
|
|||||
General and administrative expense
|
|
—
|
|
|
—
|
|
|
78.6
|
|
|
—
|
|
|
78.6
|
|
|||||
Interest and other (income)
|
|
—
|
|
|
—
|
|
|
(5.5
|
)
|
|
—
|
|
|
(5.5
|
)
|
|||||
Financial services pre-tax income
|
|
—
|
|
|
—
|
|
|
36.1
|
|
|
—
|
|
|
36.1
|
|
|||||
Income before income taxes
|
|
450.8
|
|
|
369.7
|
|
|
26.6
|
|
|
(396.3
|
)
|
|
450.8
|
|
|||||
Income tax expense
|
|
160.4
|
|
|
130.9
|
|
|
10.3
|
|
|
(141.2
|
)
|
|
160.4
|
|
|||||
Net income
|
|
$
|
290.4
|
|
|
$
|
238.8
|
|
|
$
|
16.3
|
|
|
$
|
(255.1
|
)
|
|
$
|
290.4
|
|
Comprehensive income
|
|
$
|
290.4
|
|
|
$
|
238.8
|
|
|
$
|
16.3
|
|
|
$
|
(255.1
|
)
|
|
$
|
290.4
|
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
574.1
|
|
|
$
|
1,119.7
|
|
|
$
|
2.8
|
|
|
$
|
—
|
|
|
$
|
1,696.6
|
|
Cost of sales
|
|
453.5
|
|
|
864.0
|
|
|
2.3
|
|
|
—
|
|
|
1,319.8
|
|
|||||
Gross profit
|
|
120.6
|
|
|
255.7
|
|
|
0.5
|
|
|
—
|
|
|
376.8
|
|
|||||
Selling, general and administrative expense
|
|
87.9
|
|
|
97.7
|
|
|
2.3
|
|
|
—
|
|
|
187.9
|
|
|||||
Equity in (income) of subsidiaries
|
|
(169.0
|
)
|
|
—
|
|
|
—
|
|
|
169.0
|
|
|
—
|
|
|||||
Other (income)
|
|
(0.2
|
)
|
|
(1.1
|
)
|
|
(1.5
|
)
|
|
—
|
|
|
(2.8
|
)
|
|||||
Homebuilding pre-tax income (loss)
|
|
201.9
|
|
|
159.1
|
|
|
(0.3
|
)
|
|
(169.0
|
)
|
|
191.7
|
|
|||||
Financial Services:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues, net of recourse expense
|
|
—
|
|
|
—
|
|
|
38.4
|
|
|
—
|
|
|
38.4
|
|
|||||
General and administrative expense
|
|
—
|
|
|
—
|
|
|
30.2
|
|
|
—
|
|
|
30.2
|
|
|||||
Interest and other (income)
|
|
—
|
|
|
—
|
|
|
(2.0
|
)
|
|
—
|
|
|
(2.0
|
)
|
|||||
Financial services pre-tax income
|
|
—
|
|
|
—
|
|
|
10.2
|
|
|
—
|
|
|
10.2
|
|
|||||
Income before income taxes
|
|
201.9
|
|
|
159.1
|
|
|
9.9
|
|
|
(169.0
|
)
|
|
201.9
|
|
|||||
Income tax expense
|
|
70.9
|
|
|
55.9
|
|
|
3.4
|
|
|
(59.3
|
)
|
|
70.9
|
|
|||||
Net income
|
|
$
|
131.0
|
|
|
$
|
103.2
|
|
|
$
|
6.5
|
|
|
$
|
(109.7
|
)
|
|
$
|
131.0
|
|
Comprehensive income
|
|
$
|
131.0
|
|
|
$
|
103.5
|
|
|
$
|
6.5
|
|
|
$
|
(109.7
|
)
|
|
$
|
131.3
|
|
|
|
D.R.
Horton, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
1,126.2
|
|
|
$
|
2,200.0
|
|
|
$
|
6.1
|
|
|
$
|
—
|
|
|
$
|
3,332.3
|
|
Cost of sales
|
|
883.0
|
|
|
1,704.5
|
|
|
6.0
|
|
|
—
|
|
|
2,593.5
|
|
|||||
Gross profit
|
|
243.2
|
|
|
495.5
|
|
|
0.1
|
|
|
—
|
|
|
738.8
|
|
|||||
Selling, general and administrative expense
|
|
176.9
|
|
|
190.2
|
|
|
4.2
|
|
|
—
|
|
|
371.3
|
|
|||||
Equity in (income) of subsidiaries
|
|
(324.6
|
)
|
|
—
|
|
|
—
|
|
|
324.6
|
|
|
—
|
|
|||||
Other (income)
|
|
(0.7
|
)
|
|
(2.0
|
)
|
|
(3.4
|
)
|
|
—
|
|
|
(6.1
|
)
|
|||||
Homebuilding pre-tax income (loss)
|
|
391.6
|
|
|
307.3
|
|
|
(0.7
|
)
|
|
(324.6
|
)
|
|
373.6
|
|
|||||
Financial Services:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues, net of recourse expense
|
|
—
|
|
|
—
|
|
|
73.3
|
|
|
—
|
|
|
73.3
|
|
|||||
General and administrative expense
|
|
—
|
|
|
—
|
|
|
60.0
|
|
|
—
|
|
|
60.0
|
|
|||||
Interest and other (income)
|
|
—
|
|
|
—
|
|
|
(4.7
|
)
|
|
—
|
|
|
(4.7
|
)
|
|||||
Financial services pre-tax income
|
|
—
|
|
|
—
|
|
|
18.0
|
|
|
—
|
|
|
18.0
|
|
|||||
Income before income taxes
|
|
391.6
|
|
|
307.3
|
|
|
17.3
|
|
|
(324.6
|
)
|
|
391.6
|
|
|||||
Income tax expense
|
|
137.5
|
|
|
107.9
|
|
|
6.0
|
|
|
(113.9
|
)
|
|
137.5
|
|
|||||
Net income
|
|
$
|
254.1
|
|
|
$
|
199.4
|
|
|
$
|
11.3
|
|
|
$
|
(210.7
|
)
|
|
$
|
254.1
|
|
Comprehensive income
|
|
$
|
254.1
|
|
|
$
|
199.7
|
|
|
$
|
11.3
|
|
|
$
|
(210.7
|
)
|
|
$
|
254.4
|
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash used in operating activities
|
|
$
|
(35.5
|
)
|
|
$
|
(74.0
|
)
|
|
$
|
(44.3
|
)
|
|
$
|
(15.0
|
)
|
|
$
|
(168.8
|
)
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(Purchases of) proceeds from property and equipment
|
|
(15.0
|
)
|
|
(11.0
|
)
|
|
2.0
|
|
|
—
|
|
|
(24.0
|
)
|
|||||
Increase in restricted cash
|
|
(0.2
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
(0.4
|
)
|
|||||
Net principal increase of other mortgage loans and real estate owned
|
|
—
|
|
|
—
|
|
|
(4.9
|
)
|
|
—
|
|
|
(4.9
|
)
|
|||||
Intercompany advances
|
|
(120.9
|
)
|
|
—
|
|
|
—
|
|
|
120.9
|
|
|
—
|
|
|||||
Net cash used in investing activities
|
|
(136.1
|
)
|
|
(11.2
|
)
|
|
(2.9
|
)
|
|
120.9
|
|
|
(29.3
|
)
|
|||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from notes payable
|
|
1,312.0
|
|
|
—
|
|
|
38.3
|
|
|
—
|
|
|
1,350.3
|
|
|||||
Repayment of notes payable
|
|
(1,097.7
|
)
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
(1,098.3
|
)
|
|||||
Intercompany advances
|
|
—
|
|
|
92.0
|
|
|
28.9
|
|
|
(120.9
|
)
|
|
—
|
|
|||||
Proceeds from stock associated with certain employee benefit plans
|
|
21.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21.0
|
|
|||||
Excess income tax benefit from employee stock awards
|
|
6.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.7
|
|
|||||
Cash dividends paid
|
|
(45.7
|
)
|
|
—
|
|
|
(15.0
|
)
|
|
15.0
|
|
|
(45.7
|
)
|
|||||
Net cash provided by financing activities
|
|
196.3
|
|
|
91.7
|
|
|
51.9
|
|
|
(105.9
|
)
|
|
234.0
|
|
|||||
Increase in cash and cash equivalents
|
|
24.7
|
|
|
6.5
|
|
|
4.7
|
|
|
—
|
|
|
35.9
|
|
|||||
Cash and cash equivalents at beginning of period
|
|
497.4
|
|
|
89.5
|
|
|
74.9
|
|
|
—
|
|
|
661.8
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
522.1
|
|
|
$
|
96.0
|
|
|
$
|
79.6
|
|
|
$
|
—
|
|
|
$
|
697.7
|
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash (used in) provided by operating activities
|
|
$
|
(169.9
|
)
|
|
$
|
(118.9
|
)
|
|
$
|
63.0
|
|
|
$
|
(40.0
|
)
|
|
$
|
(265.8
|
)
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property and equipment
|
|
(12.3
|
)
|
|
(15.1
|
)
|
|
(5.4
|
)
|
|
—
|
|
|
(32.8
|
)
|
|||||
(Increase) decrease in restricted cash
|
|
(2.1
|
)
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
(2.0
|
)
|
|||||
Net principal increase of other mortgage loans and real estate owned
|
|
—
|
|
|
—
|
|
|
(1.7
|
)
|
|
—
|
|
|
(1.7
|
)
|
|||||
Intercompany advances
|
|
(157.4
|
)
|
|
—
|
|
|
—
|
|
|
157.4
|
|
|
—
|
|
|||||
Payments related to acquisition of a business
|
|
(34.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34.5
|
)
|
|||||
Net cash used in investing activities
|
|
(206.3
|
)
|
|
(15.1
|
)
|
|
(7.0
|
)
|
|
157.4
|
|
|
(71.0
|
)
|
|||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from notes payable
|
|
497.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
497.0
|
|
|||||
Repayment of notes payable
|
|
(148.8
|
)
|
|
—
|
|
|
(14.8
|
)
|
|
—
|
|
|
(163.6
|
)
|
|||||
Intercompany advances
|
|
—
|
|
|
158.6
|
|
|
(1.2
|
)
|
|
(157.4
|
)
|
|
—
|
|
|||||
Proceeds from stock associated with certain employee benefit plans
|
|
29.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29.6
|
|
|||||
Excess income tax benefit from employee stock awards
|
|
1.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.9
|
|
|||||
Cash dividends paid
|
|
(12.1
|
)
|
|
—
|
|
|
(40.0
|
)
|
|
40.0
|
|
|
(12.1
|
)
|
|||||
Net cash provided by (used in) financing activities
|
|
367.6
|
|
|
158.6
|
|
|
(56.0
|
)
|
|
(117.4
|
)
|
|
352.8
|
|
|||||
(Decrease) increase in cash and cash equivalents
|
|
(8.6
|
)
|
|
24.6
|
|
|
—
|
|
|
—
|
|
|
16.0
|
|
|||||
Cash and cash equivalents at beginning of period
|
|
871.4
|
|
|
38.4
|
|
|
67.6
|
|
|
—
|
|
|
977.4
|
|
|||||
Cash and cash equivalents at end of period
|
|
$
|
862.8
|
|
|
$
|
63.0
|
|
|
$
|
67.6
|
|
|
$
|
—
|
|
|
$
|
993.4
|
|
State
|
|
Reporting Region/Market
|
|
State
|
|
Reporting Region/Market
|
|
|
|
|
|
|
|
|
|
East Region
|
|
|
|
South Central Region
|
Delaware
|
|
Northern Delaware
|
|
Louisiana
|
|
Baton Rouge
|
Georgia
|
|
Savannah
|
|
|
|
Lafayette
|
Maryland
|
|
Baltimore
|
|
Oklahoma
|
|
Oklahoma City
|
|
|
Suburban Washington, D.C.
|
|
Texas
|
|
Austin
|
New Jersey
|
|
North New Jersey
|
|
|
|
Dallas
|
|
|
South New Jersey
|
|
|
|
El Paso
|
North Carolina
|
|
Charlotte
|
|
|
|
Fort Worth
|
|
|
Fayetteville
|
|
|
|
Houston
|
|
|
Greensboro/Winston-Salem
|
|
|
|
Killeen/Temple/Waco
|
|
|
Jacksonville
|
|
|
|
Midland/Odessa
|
|
|
Raleigh/Durham
|
|
|
|
New Braunfels/San Marcos
|
|
|
Wilmington
|
|
|
|
San Antonio
|
Pennsylvania
|
|
Philadelphia
|
|
|
|
|
South Carolina
|
|
Charleston
|
|
|
|
Southwest Region
|
|
|
Columbia
|
|
Arizona
|
|
Phoenix
|
|
|
Greenville/Spartanburg
|
|
|
|
Tucson
|
|
|
Hilton Head
|
|
New Mexico
|
|
Albuquerque
|
|
|
Myrtle Beach
|
|
|
|
|
Virginia
|
|
Northern Virginia
|
|
|
|
West Region
|
|
|
|
|
California
|
|
Bay Area
|
|
|
Midwest Region
|
|
|
|
Central Valley
|
Colorado
|
|
Denver
|
|
|
|
Imperial Valley
|
|
|
Fort Collins
|
|
|
|
Los Angeles County
|
Illinois
|
|
Chicago
|
|
|
|
Riverside County
|
Indiana
|
|
Northern Indiana
|
|
|
|
Sacramento
|
Minnesota
|
|
Minneapolis/St. Paul
|
|
|
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San Bernardino County
|
|
|
|
|
|
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San Diego County
|
|
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Southeast Region
|
|
|
|
Ventura County
|
Alabama
|
|
Birmingham
|
|
Hawaii
|
|
Hawaii
|
|
|
Huntsville
|
|
|
|
Maui
|
|
|
Mobile
|
|
|
|
Oahu
|
|
|
Montgomery
|
|
Nevada
|
|
Las Vegas
|
|
|
Tuscaloosa
|
|
|
|
Reno
|
Florida
|
|
Fort Myers/Naples
|
|
Oregon
|
|
Portland
|
|
|
Jacksonville
|
|
Utah
|
|
Salt Lake City
|
|
|
Lakeland
|
|
Washington
|
|
Seattle/Tacoma
|
|
|
Melbourne/Vero Beach
|
|
|
|
Vancouver
|
|
|
Miami/Fort Lauderdale
|
|
|
|
|
|
|
Orlando
|
|
|
|
|
|
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Pensacola/Panama City
|
|
|
|
|
|
|
Port St. Lucie
|
|
|
|
|
|
|
Tampa/Sarasota
|
|
|
|
|
|
|
Volusia County
|
|
|
|
|
|
|
West Palm Beach
|
|
|
|
|
Georgia
|
|
Atlanta
|
|
|
|
|
|
|
Augusta
|
|
|
|
|
|
|
Middle Georgia
|
|
|
|
|
Mississippi
|
|
Gulf Coast
|
|
|
|
|
|
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Hattiesburg
|
|
|
|
|
Tennessee
|
|
Nashville
|
|
|
|
|
•
|
Maintaining a strong cash balance and overall liquidity position, and controlling our level of debt.
|
•
|
Allocating and actively managing our inventory investments across our operating markets to diversify our geographic risk and optimize returns.
|
•
|
Offering new home communities that appeal to a broad range of entry-level, move-up and luxury homebuyers based on consumer demand in each market.
|
•
|
Modifying product offerings, sales pace, home prices and sales incentives as necessary in each of our markets to meet consumer demand, align with finished lot supply and construction activity and optimize returns on inventory investments and cash flows.
|
•
|
Entering into option purchase contracts to control land and finished lots, where possible, to mitigate the risk of land ownership.
|
•
|
Investing in land, land development and opportunistic acquisitions of homebuilding companies in desirable markets, while controlling the level of land and lots we own in each of our markets relative to the local new home demand.
|
•
|
Managing our inventory of homes under construction relative to demand in each of our markets, including starting construction on unsold homes to capture new home demand, monitoring the number and aging of unsold homes and aggressively marketing unsold, completed homes in inventory.
|
•
|
Controlling the cost of goods purchased from both vendors and subcontractors.
|
•
|
Improving the efficiency of our land development, construction, sales and other key operational activities.
|
•
|
Controlling our selling, general and administrative (SG&A) expense infrastructure to match production levels.
|
•
|
Homebuilding revenues
increased
38%
to
$2.3 billion
.
|
•
|
Homes closed
increased
33%
to
8,243
homes, and the average closing price of those homes
increased
4%
to
$281,300
.
|
•
|
Net sales orders
increased
30%
to
11,135
homes, and the value of net sales orders
increased
33%
to
$3.2 billion
.
|
•
|
Sales order backlog
increased
21%
to
12,177
homes, and the value of sales order backlog
increased
27%
to
$3.6 billion
.
|
•
|
Home sales gross margins
decreased
280
basis points to
19.7%
.
|
•
|
Inventory and land option charges were
$12.5 million
, compared to
$4.4 million
.
|
•
|
Homebuilding SG&A expenses
decreased
as a percentage of homebuilding revenues by
70
basis points to
10.4%
.
|
•
|
Homebuilding pre-tax income
increased
9%
to
$208.6 million
, compared to
$191.7 million
.
|
•
|
Homebuilding cash totaled
$665.8 million
, compared to
$632.5 million
and
$972.8 million
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Homebuilding inventories totaled
$8.1 billion
, compared to
$7.7 billion
and
$6.8 billion
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Homes in inventory totaled
21,300
, compared to
20,600
and
17,600
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Owned and controlled lots totaled
177,200
, compared to
183,500
and
171,600
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Homebuilding debt was
$3.5 billion
, compared to
$3.3 billion
and
$3.6 billion
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Gross homebuilding debt to total capital was
39.6%
, compared to
39.4%
and
45.5%
at
September 30, 2014
and
March 31, 2014
, respectively. Net homebuilding debt to total capital was
34.7%
, compared to
34.5%
and
38.0%
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Total financial services revenues, net of recourse expense,
increased
55%
to
$59.5 million
.
|
•
|
Financial services pre-tax income
increased
111%
to
$21.5 million
.
|
•
|
Consolidated pre-tax income
increased
14%
to
$230.1 million
, compared to
$201.9 million
.
|
•
|
Net income
increased
13%
to
$147.9 million
, compared to
$131.0 million
.
|
•
|
Diluted earnings per share
increased
5%
to
$0.40
, compared to
$0.38
.
|
•
|
Total equity was
$5.4 billion
, compared to
$5.1 billion
and
$4.3 billion
at
September 30, 2014
and
March 31, 2014
, respectively.
|
•
|
Homebuilding revenues
increased
38%
to
$4.6 billion
.
|
•
|
Homes closed
increased
31%
to
16,216
homes, and the average closing price of those homes
increased
5%
to
$281,200
.
|
•
|
Net sales orders
increased
32%
to
18,505
homes, and the value of net sales orders
increased
35%
to
$5.3 billion
.
|
•
|
Home sales gross margins
decreased
270
basis points to
19.7%
.
|
•
|
Inventory and land option charges were
$18.6 million
, compared to
$7.1 million
.
|
•
|
Homebuilding SG&A expenses
decreased
as a percentage of homebuilding revenues by
60
basis points to
10.5%
.
|
•
|
Homebuilding pre-tax income
increased
11%
to
$414.7 million
, compared to
$373.6 million
.
|
•
|
Total financial services revenues, net of recourse expense,
increased
49%
to
$109.2 million
.
|
•
|
Financial services pre-tax income
increased
101%
to
$36.1 million
.
|
•
|
Consolidated pre-tax income
increased
15%
to
$450.8 million
, compared to
$391.6 million
.
|
•
|
Net income
increased
14%
to
$290.4 million
, compared to
$254.1 million
.
|
•
|
Diluted earnings per share
increased
8%
to
$0.79
, compared to
$0.73
.
|
|
|
Net Sales Orders
(1)
|
|||||||||||||||||||||||||||
|
|
Three Months Ended March 31,
|
|||||||||||||||||||||||||||
|
|
Net Homes Sold
|
|
Value (In millions)
|
|
Average Selling Price
|
|||||||||||||||||||||||
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|||||||||||
East
|
|
1,481
|
|
1,056
|
|
40
|
%
|
|
$
|
394.7
|
|
|
$
|
290.5
|
|
|
36
|
%
|
|
$
|
266,500
|
|
|
$
|
275,100
|
|
|
(3
|
)%
|
Midwest
|
|
571
|
|
424
|
|
35
|
%
|
|
218.0
|
|
|
152.3
|
|
|
43
|
%
|
|
381,800
|
|
|
359,200
|
|
|
6
|
%
|
||||
Southeast
|
|
3,216
|
|
2,365
|
|
36
|
%
|
|
835.2
|
|
|
592.1
|
|
|
41
|
%
|
|
259,700
|
|
|
250,400
|
|
|
4
|
%
|
||||
South Central
|
|
3,812
|
|
2,857
|
|
33
|
%
|
|
904.0
|
|
|
626.5
|
|
|
44
|
%
|
|
237,100
|
|
|
219,300
|
|
|
8
|
%
|
||||
Southwest
|
|
447
|
|
443
|
|
1
|
%
|
|
99.3
|
|
|
95.7
|
|
|
4
|
%
|
|
222,100
|
|
|
216,000
|
|
|
3
|
%
|
||||
West
|
|
1,608
|
|
1,424
|
|
13
|
%
|
|
715.6
|
|
|
632.9
|
|
|
13
|
%
|
|
445,000
|
|
|
444,500
|
|
|
—
|
%
|
||||
|
|
11,135
|
|
8,569
|
|
30
|
%
|
|
$
|
3,166.8
|
|
|
$
|
2,390.0
|
|
|
33
|
%
|
|
$
|
284,400
|
|
|
$
|
278,900
|
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
Six Months Ended March 31,
|
|||||||||||||||||||||||||||
|
|
Net Homes Sold
|
|
Value (In millions)
|
|
Average Selling Price
|
|||||||||||||||||||||||
|
|
2015
|
|
2014
|
|
%
Change |
|
2015
|
|
2014
|
|
%
Change |
|
2015
|
|
2014
|
|
%
Change |
|||||||||||
East
|
|
2,451
|
|
1,732
|
|
42
|
%
|
|
$
|
654.8
|
|
|
$
|
482.0
|
|
|
36
|
%
|
|
$
|
267,200
|
|
|
$
|
278,300
|
|
|
(4
|
)%
|
Midwest
|
|
911
|
|
647
|
|
41
|
%
|
|
341.3
|
|
|
238.4
|
|
|
43
|
%
|
|
374,600
|
|
|
368,500
|
|
|
2
|
%
|
||||
Southeast
|
|
5,443
|
|
3,979
|
|
37
|
%
|
|
1,404.1
|
|
|
1,001.4
|
|
|
40
|
%
|
|
258,000
|
|
|
251,700
|
|
|
3
|
%
|
||||
South Central
|
|
6,178
|
|
4,736
|
|
30
|
%
|
|
1,472.8
|
|
|
1,040.7
|
|
|
42
|
%
|
|
238,400
|
|
|
219,700
|
|
|
9
|
%
|
||||
Southwest
|
|
757
|
|
673
|
|
12
|
%
|
|
168.8
|
|
|
145.4
|
|
|
16
|
%
|
|
223,000
|
|
|
216,000
|
|
|
3
|
%
|
||||
West
|
|
2,765
|
|
2,256
|
|
23
|
%
|
|
1,233.2
|
|
|
985.2
|
|
|
25
|
%
|
|
446,000
|
|
|
436,700
|
|
|
2
|
%
|
||||
|
|
18,505
|
|
14,023
|
|
32
|
%
|
|
$
|
5,275.0
|
|
|
$
|
3,893.1
|
|
|
35
|
%
|
|
$
|
285,100
|
|
|
$
|
277,600
|
|
|
3
|
%
|
|
|
Sales Order Cancellations
|
||||||||||||||||
|
|
Three Months Ended March 31,
|
||||||||||||||||
|
|
Cancelled Sales Orders
|
|
Value (In millions)
|
|
Cancellation Rate
(2)
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||
East
|
|
374
|
|
247
|
|
$
|
97.8
|
|
|
$
|
63.1
|
|
|
20
|
%
|
|
19
|
%
|
Midwest
|
|
62
|
|
48
|
|
21.9
|
|
|
18.2
|
|
|
10
|
%
|
|
10
|
%
|
||
Southeast
|
|
921
|
|
611
|
|
222.4
|
|
|
140.1
|
|
|
22
|
%
|
|
21
|
%
|
||
South Central
|
|
922
|
|
762
|
|
216.2
|
|
|
166.3
|
|
|
19
|
%
|
|
21
|
%
|
||
Southwest
|
|
176
|
|
123
|
|
36.2
|
|
|
24.8
|
|
|
28
|
%
|
|
22
|
%
|
||
West
|
|
271
|
|
221
|
|
118.4
|
|
|
93.6
|
|
|
14
|
%
|
|
13
|
%
|
||
|
|
2,726
|
|
2,012
|
|
$
|
712.9
|
|
|
$
|
506.1
|
|
|
20
|
%
|
|
19
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Six Months Ended March 31,
|
||||||||||||||||
|
|
Cancelled Sales Orders
|
|
Value (In millions)
|
|
Cancellation Rate
(2)
|
||||||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||
East
|
|
690
|
|
416
|
|
$
|
184.7
|
|
|
$
|
105.5
|
|
|
22
|
%
|
|
19
|
%
|
Midwest
|
|
127
|
|
93
|
|
44.6
|
|
|
33.9
|
|
|
12
|
%
|
|
13
|
%
|
||
Southeast
|
|
1,628
|
|
1,107
|
|
394.5
|
|
|
254.6
|
|
|
23
|
%
|
|
22
|
%
|
||
South Central
|
|
1,745
|
|
1,366
|
|
402.4
|
|
|
291.3
|
|
|
22
|
%
|
|
22
|
%
|
||
Southwest
|
|
281
|
|
252
|
|
59.0
|
|
|
49.9
|
|
|
27
|
%
|
|
27
|
%
|
||
West
|
|
553
|
|
415
|
|
249.5
|
|
|
177.7
|
|
|
17
|
%
|
|
16
|
%
|
||
|
|
5,024
|
|
3,649
|
|
$
|
1,334.7
|
|
|
$
|
912.9
|
|
|
21
|
%
|
|
21
|
%
|
(1)
|
Net sales orders represent the number and dollar value of new sales contracts executed with customers (gross sales orders), net of cancelled sales orders.
|
(2)
|
Cancellation rate represents the number of cancelled sales orders divided by gross sales orders.
|
|
|
Sales Order Backlog
|
|||||||||||||||||||||||||||
|
|
As of March 31,
|
|||||||||||||||||||||||||||
|
|
Homes in Backlog
|
|
Value (In millions)
|
|
Average Selling Price
|
|||||||||||||||||||||||
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|||||||||||
East
|
|
1,796
|
|
1,222
|
|
47
|
%
|
|
$
|
494.8
|
|
|
$
|
346.2
|
|
|
43
|
%
|
|
$
|
275,500
|
|
|
$
|
283,300
|
|
|
(3
|
)%
|
Midwest
|
|
671
|
|
521
|
|
29
|
%
|
|
257.8
|
|
|
192.0
|
|
|
34
|
%
|
|
384,200
|
|
|
368,500
|
|
|
4
|
%
|
||||
Southeast
|
|
3,446
|
|
3,052
|
|
13
|
%
|
|
934.4
|
|
|
793.0
|
|
|
18
|
%
|
|
271,200
|
|
|
259,800
|
|
|
4
|
%
|
||||
South Central
|
|
4,272
|
|
3,479
|
|
23
|
%
|
|
1,072.0
|
|
|
794.0
|
|
|
35
|
%
|
|
250,900
|
|
|
228,200
|
|
|
10
|
%
|
||||
Southwest
|
|
539
|
|
504
|
|
7
|
%
|
|
118.6
|
|
|
107.8
|
|
|
10
|
%
|
|
220,000
|
|
|
213,900
|
|
|
3
|
%
|
||||
West
|
|
1,453
|
|
1,281
|
|
13
|
%
|
|
696.8
|
|
|
590.5
|
|
|
18
|
%
|
|
479,600
|
|
|
461,000
|
|
|
4
|
%
|
||||
|
|
12,177
|
|
10,059
|
|
21
|
%
|
|
$
|
3,574.4
|
|
|
$
|
2,823.5
|
|
|
27
|
%
|
|
$
|
293,500
|
|
|
$
|
280,700
|
|
|
5
|
%
|
|
|
Homes Closed and Home Sales Revenue
|
|||||||||||||||||||||||||||
|
|
Three Months Ended March 31,
|
|||||||||||||||||||||||||||
|
|
Homes Closed
|
|
Value (In millions)
|
|
Average Selling Price
|
|||||||||||||||||||||||
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|||||||||||
East
|
|
1,018
|
|
763
|
|
33
|
%
|
|
$
|
278.8
|
|
|
$
|
203.2
|
|
|
37
|
%
|
|
$
|
273,900
|
|
|
$
|
266,300
|
|
|
3
|
%
|
Midwest
|
|
402
|
|
284
|
|
42
|
%
|
|
145.0
|
|
|
99.9
|
|
|
45
|
%
|
|
360,700
|
|
|
351,800
|
|
|
3
|
%
|
||||
Southeast
|
|
2,518
|
|
1,891
|
|
33
|
%
|
|
644.8
|
|
|
464.8
|
|
|
39
|
%
|
|
256,100
|
|
|
245,800
|
|
|
4
|
%
|
||||
South Central
|
|
2,709
|
|
1,948
|
|
39
|
%
|
|
619.8
|
|
|
421.9
|
|
|
47
|
%
|
|
228,800
|
|
|
216,600
|
|
|
6
|
%
|
||||
Southwest
|
|
313
|
|
305
|
|
3
|
%
|
|
70.9
|
|
|
63.1
|
|
|
12
|
%
|
|
226,500
|
|
|
206,900
|
|
|
9
|
%
|
||||
West
|
|
1,283
|
|
1,003
|
|
28
|
%
|
|
559.5
|
|
|
427.1
|
|
|
31
|
%
|
|
436,100
|
|
|
425,800
|
|
|
2
|
%
|
||||
|
|
8,243
|
|
6,194
|
|
33
|
%
|
|
$
|
2,318.8
|
|
|
$
|
1,680.0
|
|
|
38
|
%
|
|
$
|
281,300
|
|
|
$
|
271,200
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|
Six Months Ended March 31,
|
|||||||||||||||||||||||||||
|
|
Homes Closed
|
|
Value (In millions)
|
|
Average Selling Price
|
|||||||||||||||||||||||
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|
2015
|
|
2014
|
|
%
Change
|
|||||||||||
East
|
|
2,106
|
|
1,505
|
|
40
|
%
|
|
$
|
576.7
|
|
|
$
|
393.3
|
|
|
47
|
%
|
|
$
|
273,800
|
|
|
$
|
261,300
|
|
|
5
|
%
|
Midwest
|
|
767
|
|
582
|
|
32
|
%
|
|
274.7
|
|
|
205.7
|
|
|
34
|
%
|
|
358,100
|
|
|
353,400
|
|
|
1
|
%
|
||||
Southeast
|
|
4,898
|
|
3,737
|
|
31
|
%
|
|
1,260.4
|
|
|
912.1
|
|
|
38
|
%
|
|
257,300
|
|
|
244,100
|
|
|
5
|
%
|
||||
South Central
|
|
5,264
|
|
3,954
|
|
33
|
%
|
|
1,192.5
|
|
|
842.4
|
|
|
42
|
%
|
|
226,500
|
|
|
213,100
|
|
|
6
|
%
|
||||
Southwest
|
|
643
|
|
644
|
|
—
|
%
|
|
146.3
|
|
|
133.8
|
|
|
9
|
%
|
|
227,500
|
|
|
207,800
|
|
|
9
|
%
|
||||
West
|
|
2,538
|
|
1,960
|
|
29
|
%
|
|
1,108.8
|
|
|
823.5
|
|
|
35
|
%
|
|
436,900
|
|
|
420,200
|
|
|
4
|
%
|
||||
|
|
16,216
|
|
12,382
|
|
31
|
%
|
|
$
|
4,559.4
|
|
|
$
|
3,310.8
|
|
|
38
|
%
|
|
$
|
281,200
|
|
|
$
|
267,400
|
|
|
5
|
%
|
Homebuilding Operating Margin Analysis
|
||||||||||||
|
|
Percentages of Related Revenues
|
||||||||||
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
Gross profit – Home sales
|
|
19.7
|
%
|
|
22.5
|
%
|
|
19.7
|
%
|
|
22.4
|
%
|
Gross profit – Land/lot sales and other
|
|
10.7
|
%
|
|
24.1
|
%
|
|
12.8
|
%
|
|
21.4
|
%
|
Inventory and land option charges
|
|
(0.5
|
)%
|
|
(0.3
|
)%
|
|
(0.4
|
)%
|
|
(0.2
|
)%
|
Gross profit – Total homebuilding
|
|
19.1
|
%
|
|
22.2
|
%
|
|
19.3
|
%
|
|
22.2
|
%
|
Selling, general and administrative expense
|
|
10.4
|
%
|
|
11.1
|
%
|
|
10.5
|
%
|
|
11.1
|
%
|
Other (income)
|
|
(0.2
|
)%
|
|
(0.2
|
)%
|
|
(0.2
|
)%
|
|
(0.2
|
)%
|
Homebuilding pre-tax income
|
|
8.9
|
%
|
|
11.3
|
%
|
|
9.0
|
%
|
|
11.2
|
%
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
||||||||||||||||||
|
|
Homebuilding
Revenues
|
|
Homebuilding
Pre-tax
Income (1)
|
|
% of
Revenues
|
|
Homebuilding
Revenues
|
|
Homebuilding
Pre-tax
Income (1)
|
|
% of
Revenues
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||||
East
|
|
$
|
280.7
|
|
|
$
|
13.0
|
|
|
4.6
|
%
|
|
$
|
203.2
|
|
|
$
|
14.2
|
|
|
7.0
|
%
|
Midwest
|
|
145.0
|
|
|
10.2
|
|
|
7.0
|
%
|
|
99.9
|
|
|
9.1
|
|
|
9.1
|
%
|
||||
Southeast
|
|
646.1
|
|
|
58.7
|
|
|
9.1
|
%
|
|
471.3
|
|
|
52.2
|
|
|
11.1
|
%
|
||||
South Central
|
|
628.2
|
|
|
65.1
|
|
|
10.4
|
%
|
|
430.4
|
|
|
46.6
|
|
|
10.8
|
%
|
||||
Southwest
|
|
70.9
|
|
|
1.2
|
|
|
1.7
|
%
|
|
63.1
|
|
|
5.5
|
|
|
8.7
|
%
|
||||
West
|
|
567.6
|
|
|
60.4
|
|
|
10.6
|
%
|
|
428.7
|
|
|
64.1
|
|
|
15.0
|
%
|
||||
|
|
$
|
2,338.5
|
|
|
$
|
208.6
|
|
|
8.9
|
%
|
|
$
|
1,696.6
|
|
|
$
|
191.7
|
|
|
11.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
Six Months Ended March 31,
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
||||||||||||||||||
|
|
Homebuilding
Revenues
|
|
Homebuilding
Pre-tax
Income (1)
|
|
% of
Revenues
|
|
Homebuilding
Revenues
|
|
Homebuilding
Pre-tax
Income (1)
|
|
% of
Revenues
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||||
East
|
|
$
|
579.5
|
|
|
$
|
39.4
|
|
|
6.8
|
%
|
|
$
|
393.3
|
|
|
$
|
25.7
|
|
|
6.5
|
%
|
Midwest
|
|
274.9
|
|
|
15.0
|
|
|
5.5
|
%
|
|
205.7
|
|
|
19.1
|
|
|
9.3
|
%
|
||||
Southeast
|
|
1,265.5
|
|
|
116.7
|
|
|
9.2
|
%
|
|
918.7
|
|
|
103.7
|
|
|
11.3
|
%
|
||||
South Central
|
|
1,207.9
|
|
|
126.2
|
|
|
10.4
|
%
|
|
851.5
|
|
|
89.0
|
|
|
10.5
|
%
|
||||
Southwest
|
|
146.3
|
|
|
3.1
|
|
|
2.1
|
%
|
|
133.8
|
|
|
11.5
|
|
|
8.6
|
%
|
||||
West
|
|
1,117.4
|
|
|
114.3
|
|
|
10.2
|
%
|
|
829.3
|
|
|
124.6
|
|
|
15.0
|
%
|
||||
|
|
$
|
4,591.5
|
|
|
$
|
414.7
|
|
|
9.0
|
%
|
|
$
|
3,332.3
|
|
|
$
|
373.6
|
|
|
11.2
|
%
|
(1)
|
Expenses maintained at the corporate level consist primarily of interest and property taxes, which are capitalized and amortized to cost of sales or expensed directly, and the expenses related to operating our corporate office. The amortization of capitalized interest and property taxes is allocated to each segment based on the segment’s cost of sales, while those expenses associated with the corporate office are allocated to each segment based on the segment’s inventory balances.
|
|
As of March 31, 2015
|
||||||||||||||||||
|
Construction in Progress and Finished Homes
|
|
Residential Land/Lots Developed and Under Development
|
|
Land Held
for Development
|
|
Land Held
for Sale
|
|
Total Inventory
|
||||||||||
|
(In millions)
|
||||||||||||||||||
East
|
$
|
483.8
|
|
|
$
|
353.6
|
|
|
$
|
43.8
|
|
|
$
|
7.3
|
|
|
$
|
888.5
|
|
Midwest
|
291.1
|
|
|
202.6
|
|
|
13.3
|
|
|
—
|
|
|
507.0
|
|
|||||
Southeast
|
1,048.3
|
|
|
889.3
|
|
|
87.4
|
|
|
5.4
|
|
|
2,030.4
|
|
|||||
South Central
|
901.9
|
|
|
1,002.9
|
|
|
19.0
|
|
|
3.9
|
|
|
1,927.7
|
|
|||||
Southwest
|
132.4
|
|
|
132.6
|
|
|
25.6
|
|
|
—
|
|
|
290.6
|
|
|||||
West
|
936.4
|
|
|
1,223.1
|
|
|
76.1
|
|
|
4.4
|
|
|
2,240.0
|
|
|||||
Corporate and unallocated (1)
|
121.9
|
|
|
124.2
|
|
|
6.1
|
|
|
0.5
|
|
|
252.7
|
|
|||||
|
$
|
3,915.8
|
|
|
$
|
3,928.3
|
|
|
$
|
271.3
|
|
|
$
|
21.5
|
|
|
$
|
8,136.9
|
|
|
As of September 30, 2014
|
||||||||||||||||||
|
Construction in Progress and Finished Homes
|
|
Residential Land/Lots Developed and Under Development
|
|
Land Held
for Development
|
|
Land Held
for Sale
|
|
Total Inventory
|
||||||||||
|
(In millions)
|
||||||||||||||||||
East
|
$
|
419.0
|
|
|
$
|
360.5
|
|
|
$
|
50.6
|
|
|
$
|
12.6
|
|
|
$
|
842.7
|
|
Midwest
|
252.9
|
|
|
211.2
|
|
|
13.3
|
|
|
0.2
|
|
|
477.6
|
|
|||||
Southeast
|
980.9
|
|
|
849.1
|
|
|
103.9
|
|
|
9.1
|
|
|
1,943.0
|
|
|||||
South Central
|
813.9
|
|
|
908.4
|
|
|
18.8
|
|
|
1.4
|
|
|
1,742.5
|
|
|||||
Southwest
|
137.2
|
|
|
132.7
|
|
|
23.0
|
|
|
—
|
|
|
292.9
|
|
|||||
West
|
830.6
|
|
|
1,220.6
|
|
|
115.7
|
|
|
2.5
|
|
|
2,169.4
|
|
|||||
Corporate and unallocated (1)
|
106.8
|
|
|
117.5
|
|
|
7.5
|
|
|
0.6
|
|
|
232.4
|
|
|||||
|
$
|
3,541.3
|
|
|
$
|
3,800.0
|
|
|
$
|
332.8
|
|
|
$
|
26.4
|
|
|
$
|
7,700.5
|
|
(1)
|
Corporate and unallocated inventory consists primarily of capitalized interest and property taxes.
|
|
As of March 31, 2015
|
|||||||||
|
Land/Lots
Owned (1)
|
|
Lots Controlled
Under
Land and Lot
Option Purchase
Contracts (2)
|
|
Total
Land/Lots
Owned and
Controlled
|
|
Homes
in
Inventory (3)
|
|||
East
|
12,700
|
|
|
7,300
|
|
|
20,000
|
|
|
3,000
|
Midwest
|
4,400
|
|
|
1,300
|
|
|
5,700
|
|
|
1,300
|
Southeast
|
36,300
|
|
|
21,200
|
|
|
57,500
|
|
|
6,300
|
South Central
|
40,000
|
|
|
18,900
|
|
|
58,900
|
|
|
6,600
|
Southwest
|
6,200
|
|
|
1,900
|
|
|
8,100
|
|
|
900
|
West
|
22,100
|
|
|
4,900
|
|
|
27,000
|
|
|
3,200
|
|
121,700
|
|
|
55,500
|
|
|
177,200
|
|
|
21,300
|
|
69
|
%
|
|
31
|
%
|
|
100
|
%
|
|
|
|
As of September 30, 2014
|
|||||||||
|
Land/Lots
Owned (1)
|
|
Lots Controlled
Under
Land and Lot
Option Purchase
Contracts (2)
|
|
Total
Land/Lots
Owned and
Controlled
|
|
Homes
in
Inventory (3)
|
|||
East
|
13,700
|
|
|
7,100
|
|
|
20,800
|
|
|
2,600
|
Midwest
|
5,000
|
|
|
1,000
|
|
|
6,000
|
|
|
1,100
|
Southeast
|
36,500
|
|
|
21,400
|
|
|
57,900
|
|
|
6,400
|
South Central
|
39,200
|
|
|
23,300
|
|
|
62,500
|
|
|
6,600
|
Southwest
|
6,300
|
|
|
1,500
|
|
|
7,800
|
|
|
1,000
|
West
|
23,900
|
|
|
4,600
|
|
|
28,500
|
|
|
2,900
|
|
124,600
|
|
|
58,900
|
|
|
183,500
|
|
|
20,600
|
|
68
|
%
|
|
32
|
%
|
|
100
|
%
|
|
|
(1)
|
Land/lots owned include approximately
32,900
and
32,400
owned lots that are fully developed and ready for home construction at
March 31, 2015
and
September 30, 2014
, respectively. Land/lots owned also include land held for development representing
12,900
and
14,000
lots at
March 31, 2015
and
September 30, 2014
, respectively.
|
(2)
|
The total remaining purchase price of lots controlled through land and lot option purchase contracts at both
March 31, 2015
and
September 30, 2014
was
$2.0 billion
, secured by earnest money deposits of
$64.4 million
and
$58.7 million
, respectively. Our lots controlled under land and lot option purchase contracts exclude approximately
1,500
and
2,200
lots at
March 31, 2015
and
September 30, 2014
, respectively, representing lots controlled under lot option contracts for which we do not expect to exercise our option to purchase the land or lots, but the underlying contracts have yet to be terminated. We have reserved the deposits related to these contracts.
|
(3)
|
Homes in inventory include approximately
1,700
and
1,500
model homes at
March 31, 2015
and
September 30, 2014
, respectively. Approximately
10,200
and
11,200
of our homes in inventory were unsold at
March 31, 2015
and
September 30, 2014
, respectively. At
March 31, 2015
, approximately
4,100
of our unsold homes were completed, of which approximately
700
homes had been completed for more than six months. At
September 30, 2014
, approximately
3,900
of our unsold homes were completed, of which approximately
600
homes had been completed for more than six months.
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||||
|
|
2015
|
|
2014
|
|
% Change
|
|
2015
|
|
2014
|
|
% Change
|
||||||
Number of first-lien loans originated or brokered by DHI Mortgage for D.R. Horton homebuyers
|
|
4,243
|
|
|
3,129
|
|
|
36
|
%
|
|
8,166
|
|
|
6,161
|
|
|
33
|
%
|
Number of homes closed by D.R. Horton
|
|
8,243
|
|
|
6,194
|
|
|
33
|
%
|
|
16,216
|
|
|
12,382
|
|
|
31
|
%
|
DHI Mortgage capture rate
|
|
51
|
%
|
|
51
|
%
|
|
|
|
50
|
%
|
|
50
|
%
|
|
|
||
Number of total loans originated or brokered by DHI Mortgage for D.R. Horton homebuyers
|
|
4,283
|
|
|
3,144
|
|
|
36
|
%
|
|
8,232
|
|
|
6,188
|
|
|
33
|
%
|
Total number of loans originated or brokered by DHI Mortgage
|
|
4,819
|
|
|
3,511
|
|
|
37
|
%
|
|
9,281
|
|
|
6,986
|
|
|
33
|
%
|
Captive business percentage
|
|
89
|
%
|
|
90
|
%
|
|
|
|
89
|
%
|
|
89
|
%
|
|
|
||
Loans sold by DHI Mortgage to third parties
|
|
4,614
|
|
|
3,367
|
|
|
37
|
%
|
|
9,104
|
|
|
7,224
|
|
|
26
|
%
|
|
|
Three Months Ended March 31,
|
|
Six Months Ended March 31,
|
||||||||||||||||||
|
|
2015
|
|
2014
|
|
% Change
|
|
2015
|
|
2014
|
|
% Change
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||||
Loan origination fees
|
|
$
|
5.4
|
|
|
$
|
4.7
|
|
|
15
|
%
|
|
$
|
10.4
|
|
|
$
|
9.4
|
|
|
11
|
%
|
Sale of servicing rights and gains from sale of mortgage loans, net of recourse expense
|
|
40.8
|
|
|
23.9
|
|
|
71
|
%
|
|
73.6
|
|
|
44.4
|
|
|
66
|
%
|
||||
Other revenues
|
|
3.0
|
|
|
2.1
|
|
|
43
|
%
|
|
5.6
|
|
|
4.2
|
|
|
33
|
%
|
||||
Total mortgage operations revenues
|
|
49.2
|
|
|
30.7
|
|
|
60
|
%
|
|
89.6
|
|
|
58.0
|
|
|
54
|
%
|
||||
Title policy premiums, net
|
|
10.3
|
|
|
7.7
|
|
|
34
|
%
|
|
19.6
|
|
|
15.3
|
|
|
28
|
%
|
||||
Total revenues
|
|
59.5
|
|
|
38.4
|
|
|
55
|
%
|
|
109.2
|
|
|
73.3
|
|
|
49
|
%
|
||||
General and administrative expense
|
|
40.7
|
|
|
30.2
|
|
|
35
|
%
|
|
78.6
|
|
|
60.0
|
|
|
31
|
%
|
||||
Interest and other (income)
|
|
(2.7
|
)
|
|
(2.0
|
)
|
|
35
|
%
|
|
(5.5
|
)
|
|
(4.7
|
)
|
|
17
|
%
|
||||
Financial services pre-tax income
|
|
$
|
21.5
|
|
|
$
|
10.2
|
|
|
111
|
%
|
|
$
|
36.1
|
|
|
$
|
18.0
|
|
|
101
|
%
|
|
|
Percentages of
Financial Services Revenues
|
||||||||||
|
|
Three Months Ended
March 31, |
|
Six Months Ended
March 31, |
||||||||
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||
General and administrative expense
|
|
68.4
|
%
|
|
78.6
|
%
|
|
72.0
|
%
|
|
81.9
|
%
|
Interest and other (income)
|
|
(4.5
|
)%
|
|
(5.2
|
)%
|
|
(5.0
|
)%
|
|
(6.4
|
)%
|
Financial services pre-tax income
|
|
36.1
|
%
|
|
26.6
|
%
|
|
33.1
|
%
|
|
24.6
|
%
|
•
|
potential deterioration in homebuilding industry conditions or general economic conditions;
|
•
|
the cyclical nature of the homebuilding industry and changes in economic, real estate and other conditions;
|
•
|
constriction of the credit markets, which could limit our ability to access capital and increase our costs of capital;
|
•
|
reductions in the availability of mortgage financing and the liquidity provided by government-sponsored enterprises, the effects of government programs, a decrease in our ability to sell mortgage loans on attractive terms or an increase in mortgage interest rates;
|
•
|
the risks associated with our land and lot inventory;
|
•
|
home warranty and construction defect claims;
|
•
|
supply shortages and other risks of acquiring land, building materials and skilled labor;
|
•
|
reductions in the availability of performance bonds;
|
•
|
increases in the costs of owning a home;
|
•
|
the impact of an inflationary, deflationary or higher interest rate environment;
|
•
|
the effects of governmental regulations and environmental matters on our homebuilding operations;
|
•
|
the effects of governmental regulation on our financial services operations;
|
•
|
our substantial debt and our ability to comply with related debt covenants, restrictions and limitations;
|
•
|
competitive conditions within the homebuilding and financial services industries;
|
•
|
our ability to effect our growth strategies or acquisitions successfully;
|
•
|
our ability to realize the full amount of our deferred income tax assets;
|
•
|
the effects of the loss of key personnel;
|
•
|
the effects of negative publicity; and
|
•
|
information technology failures and data security breaches.
|
|
|
Six Months
Ending September 30, 2015 |
|
Fiscal Year Ending September 30,
|
|
Fair Value at March 31, 2015
|
||||||||||||||||||||||||||||||
|
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
|
Total
|
|
||||||||||||||||||||
|
|
($ in millions)
|
||||||||||||||||||||||||||||||||||
Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Fixed rate
|
|
$
|
4.3
|
|
|
$
|
549.4
|
|
|
$
|
351.0
|
|
|
$
|
400.4
|
|
|
$
|
500.0
|
|
|
$
|
500.0
|
|
|
$
|
1,050.0
|
|
|
$
|
3,355.1
|
|
|
$
|
3,445.1
|
|
Average interest rate
|
|
8.6
|
%
|
|
6.4
|
%
|
|
5.0
|
%
|
|
3.8
|
%
|
|
3.9
|
%
|
|
4.2
|
%
|
|
5.1
|
%
|
|
4.8
|
%
|
|
|
||||||||||
Variable rate
|
|
$
|
397.8
|
|
|
$
|
0.6
|
|
|
$
|
0.6
|
|
|
$
|
0.6
|
|
|
$
|
175.6
|
|
|
$
|
0.7
|
|
|
$
|
14.8
|
|
|
$
|
590.7
|
|
|
$
|
590.7
|
|
Average interest rate
|
|
2.4
|
%
|
|
3.0
|
%
|
|
3.0
|
%
|
|
3.0
|
%
|
|
1.9
|
%
|
|
3.0
|
%
|
|
3.0
|
%
|
|
2.3
|
%
|
|
|
(a)
|
Exhibits.
|
||
|
3.1
|
|
Certificate of Amendment of the Amended and Restated Certificate of Incorporation, as amended, of the Company dated January 31, 2006, and the Amended and Restated Certificate of Incorporation, as amended, of the Company dated March 18, 1992. (1)
|
|
3.2
|
|
Amended and Restated Bylaws of the Company. (2)
|
|
4.1
|
|
Eighth Supplemental Indenture, dated as of February 9, 2015, among the Company, the Guarantors named therein and American Stock Transfer & Trust Company, LLC, as trustee, relating to the 4.000% Senior Notes Due 2020 issued by the Company. (3)
|
|
10.1
|
†
|
D.R. Horton, Inc. 2006 Stock Incentive Plan, as Amended and Restated, Effective as of December 11, 2014. (4)
|
|
10.2
|
|
Second Amended and Restated Master Repurchase Agreement, dated February 27, 2015, among DHI Mortgage Company, Ltd., U.S. Bank National Association, as Administrative Agent, Sole Book Runner, Lead Arranger, and a Buyer, and all other buyers. (5)
|
|
10.3
|
|
Amended and Restated Custody Agreement, dated March 1, 2013, by and between DHI Mortgage Company, Ltd. and U.S. Bank National Association, as Administrative Agent and representative of certain buyers. (6)
|
|
10.4
|
†
|
Form of Time Based Restricted Stock Unit Agreement (Employees) pursuant to the Company’s 2006 Stock Incentive Plan, as amended and restated. (*)
|
|
12.1
|
|
Statement of Computation of Ratio of Earnings to Fixed Charges. (*)
|
|
31.1
|
|
Certificate of Chief Executive Officer provided pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002. (*)
|
|
31.2
|
|
Certificate of Chief Financial Officer provided pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002. (*)
|
|
32.1
|
|
Certificate provided pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Company's Chief Executive Officer. (*)
|
|
32.2
|
|
Certificate provided pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, by the Company's Chief Financial Officer. (*)
|
|
101
|
|
The following financial statements from D.R. Horton, Inc.'s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015, filed on April 24, 2015, formatted in XBRL (Extensible Business Reporting Language); (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income, (iii) Consolidated Statements of Cash Flows and (iv) the Notes to Consolidated Financial Statements. (*)
|
*
|
|
Filed herewith.
|
†
|
|
Management contract or compensatory plan arrangement.
|
(1)
|
Incorporated by reference from Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended December 31, 2005, filed with the SEC on February 2, 2006.
|
(2)
|
Incorporated by reference from Exhibit 3.1 to the Company's Current Report on Form 8-K dated July 30, 2009, filed with the SEC on August 5, 2009.
|
(3)
|
Incorporated by reference from Exhibit 4.1 to the Company's Current Report on Form 8-K dated February 9, 2015, filed with the SEC on February 9, 2015.
|
(4)
|
Incorporated by reference from Exhibit 10.1 to the Company's Current Report on Form 8-K dated January 22, 2015, filed with the SEC on January 26, 2015.
|
(5)
|
Incorporated by reference from Exhibit 10.1 to the Company's Current Report on Form 8-K dated February 27, 2015, filed with the SEC on March 4, 2015.
|
(6)
|
Incorporated by reference from Exhibit 10.2 to the Company's Current Report on Form 8-K dated February 27, 2015, filed with the SEC on March 4, 2015.
|
|
|
|
D.R. HORTON, INC.
|
Date:
|
April 24, 2015
|
By:
|
/s/ Bill W. Wheat
|
|
|
|
Bill W. Wheat, on behalf of D.R. Horton, Inc.,
|
|
|
|
as Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial and Principal Accounting Officer)
|
|
Participant:
|
|
|
|
|
|
|
|
Number of Restricted Stock Units
|
|
|
|
|
(singular "
RSU
"):
|
|
|
|
|
|
|
Grant Date:
|
|
|
|
|
|
|
|
Vesting Dates:
|
Subject to the terms of this Agreement, one-fifth of the RSUs will vest on each anniversary of the Grant Date (each such date, a “Vesting Date”), with the first such Vesting Date occurring on [date] and the last such Vesting Date occurring on [date].
|
|
(a)
|
The 2014 SIP is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time;
|
|
(b)
|
The grant of the Award is voluntary and occasional and does not create any contractual or other right to receive future grants of awards, or benefits in lieu of awards, even if awards have been granted repeatedly in the past. All decisions with respect to future award grants, if any, will be at the sole discretion of the Company;
|
|
(c)
|
The Award and the Participant’s participation in the 2014 SIP will not be interpreted to form an employment contract or service contract or relationship with the Company or any Subsidiary;
|
|
(d)
|
The Participant is voluntarily participating in the 2014 SIP; and
|
|
(e)
|
The future value of the underlying Shares is unknown and cannot be predicted with certainty.
|
|
(a)
|
Responsibility for Taxes
. Regardless of any action taken by the Company with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related items related to the Participant’s participation in the 2014 SIP and legally applicable to the Participant
(the “
Tax-Related Items
”)
,
the Participant acknowledges that the ultimate liability for all Tax-Related Items is and remains the Participant’s responsibility and may exceed the amount actually withheld by the Company. The Participant further acknowledges that the Company (a) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including but not limited to, the grant, vesting or settlement of the Award, the subsequent sale of Shares acquired pursuant to such settlement, or the receipt of any dividends, and (b) does not commit to and are under no obligation to structure the terms of the grant or any aspect of the Award to reduce or eliminate the Participant’s liability for Tax-Related Items or achieve any particular tax result. Further, if the Participant has become subject to tax in more than one jurisdiction between the Grant Date and the date of any relevant taxable or tax withholding event, as applicable, the Participant acknowledges that the Company may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
|
|
(b)
|
Withholding in Shares
. Subject to applicable law and the Company’s discretion, the Company may require the Participant to satisfy Tax-Related Items by deducting from the Shares otherwise deliverable to the Participant in settlement of the Award a number of whole Shares having a fair market value, as defined in the 2014 SIP, as of the date on which the Tax-Related Items arise, not in excess of the amount of such Tax-Related Items.
|
|
(c)
|
Permissible Withholding Methods
. The Company may satisfy its obligations for Tax-Related Items by:
|
|
|
(i)
|
withholding from the Participant’s cash compensation or fees paid to the Participant by the Company; or
|
|
|
(ii)
|
withholding from proceeds of the sale of Shares acquired upon vesting or settlement of the Award either through a voluntary sale or through a mandatory sale arranged by the Company (on the Participant’s behalf pursuant to this authorization); or
|
|
|
(iii)
|
allowing Participant to pay cash in the amount of the Tax-Related Items.; or
|
|
|
(iv)
|
any other method permitted by the Administrator.
|
|
(a)
|
Description of Electronic Delivery. The 2014 SIP documents, which may include but do not necessarily include: the 2014 SIP, this Agreement, the 2014 SIP Prospectus, and any reports of the Company provided generally to the Company’s stockholders, may be delivered to the Participant electronically. Such means of electronic delivery may include but do not necessarily include the delivery of a link to a Company intranet or the internet site of a third party involved in administering the 2014 SIP, the delivery of the document via e-mail or such other means of electronic delivery specified by the Company.
|
|
(b)
|
Consent to Electronic Delivery. The Participant acknowledges that the Participant has read the “Delivery of Documents and Notices” section of this Agreement and consents to the electronic delivery of the 2014 SIP documents and Agreement, as described in this section. The Participant acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost to the Participant by contacting the Company by telephone or in writing. The Participant further acknowledges that the Participant will be provided with a paper copy of any documents if the attempted electronic delivery of such documents fails. Similarly, the Participant understands that the Participant must provide the Company or any designated third party administrator with a paper copy of any documents if the attempted electronic delivery of such documents fails. The Participant may revoke his or her consent to the electronic delivery of documents described in this section or may change the electronic mail address to which such documents are to be delivered (if Participant has provided an electronic mail address) at any time by notifying the Company of such revoked consent or revised e-mail address by telephone, postal service or electronic mail. Finally, the Participant understands that he or she is not required to consent to electronic delivery of documents as described in this section.
|
By:
|
|
|
|
Date:
|
|
By:
|
|
|
[Name], Employee
|
|
|
Date:
|
|
|
|
Six Months Ended
March 31, 2015 |
|
For the Fiscal Year Ended September 30,
|
||||||||||||||||||||
|
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|||||||||||||
|
|
($ in millions)
|
||||||||||||||||||||||
Consolidated income before income taxes
|
|
$
|
450.8
|
|
|
$
|
814.2
|
|
|
$
|
657.8
|
|
|
$
|
242.9
|
|
|
$
|
12.1
|
|
|
$
|
99.5
|
|
Noncontrolling interests in losses before income taxes of majority owned subsidiaries which have incurred losses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
||||||
Amortization of capitalized interest
|
|
69.3
|
|
|
124.4
|
|
|
110.9
|
|
|
94.1
|
|
|
92.0
|
|
|
124.2
|
|
||||||
Interest expensed
|
|
2.8
|
|
|
4.8
|
|
|
11.7
|
|
|
31.5
|
|
|
57.0
|
|
|
94.4
|
|
||||||
Earnings
|
|
$
|
522.9
|
|
|
$
|
943.4
|
|
|
$
|
780.4
|
|
|
$
|
368.5
|
|
|
$
|
161.1
|
|
|
$
|
317.9
|
|
Interest incurred
|
|
$
|
85.8
|
|
|
$
|
190.6
|
|
|
$
|
177.3
|
|
|
$
|
128.7
|
|
|
$
|
136.7
|
|
|
$
|
181.3
|
|
Fixed charges
|
|
$
|
85.8
|
|
|
$
|
190.6
|
|
|
$
|
177.3
|
|
|
$
|
128.7
|
|
|
$
|
136.7
|
|
|
$
|
181.3
|
|
Ratio of earnings to fixed charges
|
|
6.09
|
|
|
4.95
|
|
|
4.40
|
|
|
2.86
|
|
|
1.18
|
|
|
1.75
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of D.R. Horton, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ D
AVID
V. A
ULD
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By:
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David V. Auld
President and Chief Executive Officer
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of D.R. Horton, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have:
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
By:
|
|
/s/ B
ILL
W. W
HEAT
|
|
|
|
Bill W. Wheat
Executive Vice President and
Chief Financial Officer
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
|
April 24, 2015
|
|
|
/s/ D
AVID
V. A
ULD
|
|
|
|
By:
|
|
David V. Auld
President and Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
|
April 24, 2015
|
By:
|
|
/s/ B
ILL
W. W
HEAT
|
|
|
|
|
|
Bill W. Wheat
Executive Vice President and
Chief Financial Officer
|