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Delaware
(State or other jurisdiction of incorporation or organization)
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75-2386963
(I.R.S. Employer Identification No.)
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1341 Horton Circle, Arlington, Texas
(Address of principal executive offices)
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76011
(Zip Code)
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Title of Each Class
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Name of Each Exchange on Which Registered
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Common Stock, par value $.01 per share
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New York Stock Exchange
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5.750% Senior Notes due 2023
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New York Stock Exchange
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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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Emerging growth company
¨
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Page
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ITEM 1.
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BUSINESS
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State
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Reporting Region/Market
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State
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Reporting Region/Market
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East Region
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South Central Region
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Delaware
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Northern Delaware
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Louisiana
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Baton Rouge
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Georgia
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Savannah
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Lafayette
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Maryland
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Baltimore
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Oklahoma
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Oklahoma City
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Suburban Washington, D.C.
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Texas
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Austin
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New Jersey
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North New Jersey
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Dallas
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South New Jersey
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El Paso
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North Carolina
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Charlotte
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Fort Worth
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Fayetteville
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Houston
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Greensboro/Winston-Salem
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Killeen/Temple/Waco
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Raleigh/Durham
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Midland/Odessa
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Wilmington
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New Braunfels/San Marcos
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Pennsylvania
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Philadelphia
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San Antonio
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South Carolina
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Charleston
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Columbia
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Southwest Region
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Greenville/Spartanburg
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Arizona
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Phoenix
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Hilton Head
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Tucson
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Myrtle Beach
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New Mexico
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Albuquerque
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Virginia
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Northern Virginia
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West Region
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Midwest Region
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California
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Bakersfield
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Colorado
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Denver
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Bay Area
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Fort Collins
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Fresno
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Illinois
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Chicago
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Los Angeles County
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Minnesota
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Minneapolis/St. Paul
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Orange County
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Riverside County
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Southeast Region
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Sacramento
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Alabama
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Birmingham
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San Bernardino County
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Huntsville
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San Diego County
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Mobile
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Ventura County
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Montgomery
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Hawaii
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Hawaii
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Tuscaloosa
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Kauai
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Florida
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Fort Myers/Naples
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Maui
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Jacksonville
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Oahu
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Lakeland
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Nevada
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Las Vegas
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Melbourne/Vero Beach
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Reno
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Miami/Fort Lauderdale
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Oregon
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Portland
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Ocala
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Utah
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Salt Lake City
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Orlando
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Washington
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Seattle/Tacoma/Everett
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Pensacola/Panama City
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Vancouver
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Port St. Lucie
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Tampa/Sarasota
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Volusia County
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West Palm Beach
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Georgia
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Atlanta
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Augusta
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Mississippi
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Gulf Coast
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Tennessee
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Knoxville
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Nashville
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•
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Economic conditions;
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•
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Employment levels and job growth;
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•
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Income level of potential homebuyers;
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•
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Local housing affordability and typical mortgage products utilized;
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•
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Market for homes at our targeted price points;
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•
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Availability of land and lots in desirable locations on acceptable terms;
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•
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Land entitlement and development processes;
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•
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Availability of qualified subcontractors;
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•
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New and secondary home sales activity;
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•
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Competition; and
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•
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Prevailing housing products, features, cost and pricing.
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•
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Greater access to and lower cost of capital, due to our balance sheet strength and our lending and capital markets relationships;
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•
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Volume discounts and rebates from national, regional and local materials suppliers and lower labor rates from certain subcontractors; and
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•
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Enhanced leverage of our general and administrative activities, which allows us flexibility to adjust to changes in market conditions and compete effectively in each of our markets.
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•
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Site selection, which involves
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•
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Negotiating lot option, land acquisition and related contracts;
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•
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Obtaining all necessary land development and home construction approvals;
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•
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Selecting land development subcontractors and ensuring their work meets our contracted scopes;
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•
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Selecting building and architectural plans;
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•
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Selecting construction subcontractors and ensuring their work meets our contracted scopes;
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•
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Planning and managing home construction schedules;
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•
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Determining the pricing for each house plan and options in a given community;
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•
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Developing and implementing local marketing and sales plans;
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•
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Coordinating all interactions with customers and real estate brokers during the sales, construction and home closing processes; and
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•
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Ensuring the quality and timeliness of post-closing service and warranty repairs provided to customers.
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•
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Review and approval of division business plans and budgets;
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•
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Review and approval of all land and lot acquisition contracts;
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•
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Review of all business and financial analysis for potential land and lot inventory investments;
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•
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Oversight of land and home inventory levels;
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•
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Monitoring division financial and operating performance; and
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•
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Review of major personnel decisions and division incentive compensation plans.
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•
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Financing;
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•
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Cash management;
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•
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Allocation of capital;
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•
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Issuance and monitoring of inventory investment guidelines;
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•
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Approval and funding of land and lot acquisitions;
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•
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Monitoring and analysis of profitability, returns, costs and inventory levels;
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•
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Risk and litigation management;
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•
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Environmental assessments of land and lot acquisitions;
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•
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Technology systems to support management of operations, marketing and information;
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•
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Accounting and management reporting;
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•
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Income taxes;
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•
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Internal audit;
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•
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Public reporting and investor and media relations;
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•
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Administration of payroll and employee benefits;
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•
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Negotiation of national purchasing contracts;
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•
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Administration, reporting and monitoring of customer satisfaction surveys and resolutions of issues; and
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•
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Approval of major personnel decisions and management incentive compensation plans.
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•
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Managing our supply of land/lots controlled (owned and optioned) in each market based on anticipated future home closing levels;
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•
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Monitoring local market and demographic trends, housing preferences and related economic developments, including the identification of desirable housing submarkets based on the quality of local schools, new job opportunities, local growth initiatives and personal income trends;
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•
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Utilizing land/lot option contracts, where possible;
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•
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Seeking to acquire developed lots which are substantially ready for home construction, where possible;
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•
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Controlling our levels of investment in land acquisition, land development and housing inventory to match the expected housing demand in each of our operating markets; and
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•
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Monitoring and managing the number of speculative homes (homes under construction without an executed sales contract) built in each subdivision.
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Percentage of
Home Closings
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Percentage of
Home Sales Revenue
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||||
D.R. Horton
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64
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%
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67
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%
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Emerald
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4
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%
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8
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%
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Express
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31
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%
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24
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%
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Freedom
|
1
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%
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|
|
1
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%
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Total
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100
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%
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100
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%
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ITEM 1A.
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RISK FACTORS
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•
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employment levels;
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•
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consumer confidence and spending;
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•
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housing demand;
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•
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availability of financing for homebuyers;
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•
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interest rates;
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•
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availability and prices of new homes for sale and alternatives to new homes, including foreclosed homes, homes held for sale by investors and speculators, other existing homes and rental properties; and
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•
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demographic trends.
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•
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difficulty in acquiring land suitable for residential building at affordable prices in locations where our potential customers want to live;
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•
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shortages of qualified subcontractors;
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•
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reliance on local subcontractors, manufacturers and distributors who may be inadequately capitalized;
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•
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shortages of materials; and
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•
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volatile increases in the cost of materials, particularly increases in the price of lumber, drywall and cement, which are significant components of home construction costs.
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•
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require us to dedicate a substantial portion of our cash flow from operations to payment of our debt and reduce our ability to use our cash flow for other operating or investing purposes;
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•
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limit our flexibility to adjust to changes in our business or economic conditions; and
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•
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limit our ability to obtain future financing for working capital, capital expenditures, acquisitions, debt service requirements or other requirements.
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ITEM 1B.
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UNRESOLVED STAFF COMMENTS
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ITEM 2.
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PROPERTIES
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ITEM 3.
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LEGAL PROCEEDINGS
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ITEM 4.
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MINE SAFETY DISCLOSURES
|
ITEM 5.
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MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
Year Ended September 30, 2017
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Year Ended September 30, 2016
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||||||||||||||||||||
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High
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Low
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Declared
Dividends
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High
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Low
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Declared
Dividends
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||||||||||||
1st Quarter
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$
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30.62
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$
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26.69
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$
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0.10
|
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$
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33.10
|
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$
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28.45
|
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$
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0.08
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2nd Quarter
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34.06
|
|
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27.21
|
|
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0.10
|
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31.64
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22.97
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|
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0.08
|
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||||||
3rd Quarter
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34.94
|
|
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31.98
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|
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0.10
|
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32.51
|
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28.82
|
|
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0.08
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||||||
4th Quarter
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40.01
|
|
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34.06
|
|
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0.10
|
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34.56
|
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29.64
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|
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0.08
|
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Year Ended September 30,
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||||||||||||||||||||||
|
2012
|
|
2013
|
|
2014
|
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2015
|
|
2016
|
|
2017
|
||||||||||||
D.R. Horton, Inc.
|
$
|
100.00
|
|
|
$
|
95.10
|
|
|
$
|
101.04
|
|
|
$
|
145.90
|
|
|
$
|
151.67
|
|
|
$
|
203.07
|
|
S&P 500 Index
|
100.00
|
|
|
119.34
|
|
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142.89
|
|
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142.02
|
|
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163.93
|
|
|
194.44
|
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||||||
S&P 1500 Homebuilding Index
|
100.00
|
|
|
103.93
|
|
|
107.04
|
|
|
130.03
|
|
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129.26
|
|
|
178.92
|
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ITEM 6.
|
SELECTED FINANCIAL DATA
|
|
Year Ended September 30,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
|
|
(In millions, except per share data)
|
|
|
||||||||||||||
Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Homebuilding
|
$
|
13,741.5
|
|
|
$
|
11,861.8
|
|
|
$
|
10,559.0
|
|
|
$
|
7,858.5
|
|
|
$
|
6,085.9
|
|
Financial Services
|
349.5
|
|
|
295.6
|
|
|
265.0
|
|
|
166.4
|
|
|
173.4
|
|
|||||
Inventory and land option charges
|
40.2
|
|
|
31.4
|
|
|
60.3
|
|
|
85.2
|
|
|
31.1
|
|
|||||
Gross profit — Homebuilding
|
2,698.7
|
|
|
2,359.2
|
|
|
2,023.3
|
|
|
1,589.9
|
|
|
1,232.4
|
|
|||||
Income before income taxes:
|
|
|
|
|
|
|
|
|
|
||||||||||
Homebuilding
|
1,489.3
|
|
|
1,264.4
|
|
|
1,018.3
|
|
|
768.5
|
|
|
589.8
|
|
|||||
Financial Services and Other
|
112.8
|
|
|
89.1
|
|
|
105.1
|
|
|
45.7
|
|
|
68.0
|
|
|||||
Income tax expense
|
563.7
|
|
|
467.2
|
|
|
372.7
|
|
|
280.7
|
|
|
195.1
|
|
|||||
Net income
|
1,038.4
|
|
|
886.3
|
|
|
750.7
|
|
|
533.5
|
|
|
462.7
|
|
|||||
Net income per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
2.77
|
|
|
2.39
|
|
|
2.05
|
|
|
1.57
|
|
|
1.44
|
|
|||||
Diluted
|
2.74
|
|
|
2.36
|
|
|
2.03
|
|
|
1.50
|
|
|
1.33
|
|
|||||
Cash dividends declared per common share
|
0.40
|
|
|
0.32
|
|
|
0.25
|
|
|
0.1375
|
|
|
0.1875
|
|
|
September 30,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents and marketable securities
|
$
|
1,007.8
|
|
|
$
|
1,303.2
|
|
|
$
|
1,383.8
|
|
|
$
|
661.8
|
|
|
$
|
977.4
|
|
Inventories
|
9,237.1
|
|
|
8,340.9
|
|
|
7,807.0
|
|
|
7,700.5
|
|
|
6,197.4
|
|
|||||
Total assets
|
12,184.6
|
|
|
11,558.9
|
|
|
11,151.0
|
|
|
10,185.4
|
|
|
8,838.4
|
|
|||||
Notes payable (1)
|
2,871.6
|
|
|
3,271.3
|
|
|
3,811.5
|
|
|
3,665.7
|
|
|
3,491.0
|
|
|||||
Total equity
|
7,747.6
|
|
|
6,793.0
|
|
|
5,895.4
|
|
|
5,119.7
|
|
|
4,061.4
|
|
(1)
|
Notes payable includes both homebuilding notes payable and amounts outstanding on our mortgage repurchase facility.
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
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.
|
•
|
Offering new home communities that appeal to a broad range of entry-level, move-up, active adult 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.
|
•
|
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 and actively controlling the number of unsold, completed homes in inventory.
|
•
|
Investing in land and land development and pursuing 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.
|
•
|
Increasing the amount of land and finished lots controlled through option purchase contracts by expanding relationships with land developers across the country.
|
•
|
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
16%
to
$13.7 billion
.
|
•
|
Homes closed
increased
14%
to
45,751
homes, and the average closing price of those homes
increased
2%
to
$298,400
.
|
•
|
Net sales orders
increased
14%
to
46,605
homes, and the value of net sales orders
increased
16%
to
$13.9 billion
.
|
•
|
Sales order backlog
increased
7%
to
12,329
homes, and the value of sales order backlog
increased
8%
to
$3.7 billion
.
|
•
|
Home sales gross margin
decreased
20
basis points to
20.0%
.
|
•
|
Homebuilding SG&A expenses as a percentage of homebuilding revenues
decreased
by
40
basis points to
8.9%
.
|
•
|
Homebuilding pre-tax income
increased
18%
to
$1.5 billion
compared to
$1.3 billion
.
|
•
|
Homebuilding pre-tax income as a percentage of homebuilding revenues was
10.8%
compared to
10.7%
.
|
•
|
Homebuilding return on inventory
improved
120
basis points to
16.6%
.
|
•
|
Homebuilding cash and cash equivalents totaled
$973.0 million
compared to
$1.3 billion
.
|
•
|
Homebuilding inventories totaled
$9.2 billion
compared to
$8.3 billion
.
|
•
|
Homes in inventory totaled
26,200
compared to
23,100
.
|
•
|
Owned lots totaled
125,000
compared to
112,900
, and lots controlled through option purchase contracts totaled
124,000
compared to
91,600
.
|
•
|
Homebuilding debt was
$2.5 billion
compared to
$2.8 billion
.
|
•
|
Homebuilding debt to total capital was
24.0%
,
improved
from
29.2%
.
|
•
|
Financial services and other revenues
increased
18%
to
$349.5 million
.
|
•
|
Financial services and other pre-tax income
increased
27%
to
$112.8 million
, compared to
$89.1 million
.
|
•
|
Financial services and other pre-tax income as a percentage of financial services and other revenues was
32.3%
compared to
30.1%
.
|
•
|
Consolidated pre-tax income
increased
18%
to
$1.6 billion
compared to
$1.4 billion
.
|
•
|
Consolidated pre-tax income as a percentage of consolidated revenues was
11.4%
compared to
11.1%
.
|
•
|
Net income
increased
17%
to
$1.0 billion
compared to
$886.3 million
.
|
•
|
Diluted earnings per share
increased
16%
to
$2.74
compared to
$2.36
.
|
•
|
Total equity was
$7.7 billion
compared to
$6.8 billion
.
|
•
|
Book value per common share
increased
13%
to
$20.66
compared to
$18.21
.
|
•
|
Net cash provided by operations was
$435.1 million
compared to
$618.0 million
.
|
|
East:
|
|
Delaware, Georgia (Savannah only), Maryland, New Jersey, North Carolina, Pennsylvania, South Carolina and Virginia
|
|
Midwest:
|
|
Colorado, Illinois 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
|
Net Sales Orders (1)
|
|
Net Homes Sold
|
||||||||||||||||
|
Fiscal Year Ended September 30,
|
|
% Change
|
|||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2017 vs 2016
|
|
2016 vs 2015
|
||||||||
East
|
|
6,039
|
|
|
4,944
|
|
|
4,859
|
|
|
22
|
%
|
|
2
|
%
|
|||
Midwest
|
|
1,841
|
|
|
1,766
|
|
|
1,696
|
|
|
4
|
%
|
|
4
|
%
|
|||
Southeast
|
|
15,575
|
|
|
13,616
|
|
|
11,703
|
|
|
14
|
%
|
|
16
|
%
|
|||
South Central
|
|
13,374
|
|
|
12,433
|
|
|
11,753
|
|
|
8
|
%
|
|
6
|
%
|
|||
Southwest
|
|
2,693
|
|
|
1,761
|
|
|
1,645
|
|
|
53
|
%
|
|
7
|
%
|
|||
West
|
|
7,083
|
|
|
6,294
|
|
|
5,724
|
|
|
13
|
%
|
|
10
|
%
|
|||
|
|
46,605
|
|
|
40,814
|
|
|
37,380
|
|
|
14
|
%
|
|
9
|
%
|
|||
|
|
Value (In millions)
|
||||||||||||||||
East
|
|
$
|
1,708.9
|
|
|
$
|
1,388.5
|
|
|
$
|
1,319.8
|
|
|
23
|
%
|
|
5
|
%
|
Midwest
|
|
722.6
|
|
|
669.2
|
|
|
641.0
|
|
|
8
|
%
|
|
4
|
%
|
|||
Southeast
|
|
4,068.9
|
|
|
3,547.3
|
|
|
3,053.4
|
|
|
15
|
%
|
|
16
|
%
|
|||
South Central
|
|
3,339.1
|
|
|
3,045.4
|
|
|
2,849.7
|
|
|
10
|
%
|
|
7
|
%
|
|||
Southwest
|
|
620.5
|
|
|
409.0
|
|
|
364.1
|
|
|
52
|
%
|
|
12
|
%
|
|||
West
|
|
3,481.2
|
|
|
2,940.8
|
|
|
2,510.7
|
|
|
18
|
%
|
|
17
|
%
|
|||
|
|
$
|
13,941.2
|
|
|
$
|
12,000.2
|
|
|
$
|
10,738.7
|
|
|
16
|
%
|
|
12
|
%
|
|
|
Average Selling Price
|
||||||||||||||||
East
|
|
$
|
283,000
|
|
|
$
|
280,800
|
|
|
$
|
271,600
|
|
|
1
|
%
|
|
3
|
%
|
Midwest
|
|
392,500
|
|
|
378,900
|
|
|
377,900
|
|
|
4
|
%
|
|
—
|
%
|
|||
Southeast
|
|
261,200
|
|
|
260,500
|
|
|
260,900
|
|
|
—
|
%
|
|
—
|
%
|
|||
South Central
|
|
249,700
|
|
|
244,900
|
|
|
242,500
|
|
|
2
|
%
|
|
1
|
%
|
|||
Southwest
|
|
230,400
|
|
|
232,300
|
|
|
221,300
|
|
|
(1
|
)%
|
|
5
|
%
|
|||
West
|
|
491,500
|
|
|
467,200
|
|
|
438,600
|
|
|
5
|
%
|
|
7
|
%
|
|||
|
|
$
|
299,100
|
|
|
$
|
294,000
|
|
|
$
|
287,300
|
|
|
2
|
%
|
|
2
|
%
|
(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.
|
|
|
Sales Order Cancellations
|
|||||||||||||||||||||||||
|
|
Fiscal Year Ended September 30,
|
|||||||||||||||||||||||||
|
|
Cancelled Sales Orders
|
|
Value (In millions)
|
|
Cancellation Rate (1)
|
|||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|||||||||
East
|
|
1,818
|
|
1,582
|
|
1,536
|
|
$
|
500.3
|
|
|
$
|
425.4
|
|
|
$
|
416.7
|
|
|
23
|
%
|
|
24
|
%
|
|
24
|
%
|
Midwest
|
|
260
|
|
241
|
|
296
|
|
103.6
|
|
|
91.6
|
|
|
115.2
|
|
|
12
|
%
|
|
12
|
%
|
|
15
|
%
|
|||
Southeast
|
|
4,898
|
|
4,413
|
|
3,663
|
|
1,252.5
|
|
|
1,105.9
|
|
|
899.2
|
|
|
24
|
%
|
|
24
|
%
|
|
24
|
%
|
|||
South Central
|
|
3,989
|
|
3,795
|
|
3,833
|
|
1,000.8
|
|
|
942.5
|
|
|
913.2
|
|
|
23
|
%
|
|
23
|
%
|
|
25
|
%
|
|||
Southwest
|
|
864
|
|
745
|
|
572
|
|
196.9
|
|
|
160.4
|
|
|
123.0
|
|
|
24
|
%
|
|
30
|
%
|
|
26
|
%
|
|||
West
|
|
1,221
|
|
1,119
|
|
1,151
|
|
616.9
|
|
|
544.7
|
|
|
515.7
|
|
|
15
|
%
|
|
15
|
%
|
|
17
|
%
|
|||
|
|
13,050
|
|
11,895
|
|
11,051
|
|
$
|
3,671.0
|
|
|
$
|
3,270.5
|
|
|
$
|
2,983.0
|
|
|
22
|
%
|
|
23
|
%
|
|
23
|
%
|
(1)
|
Cancellation rate represents the number of cancelled sales orders divided by gross sales orders.
|
Sales Order Backlog
|
|
Homes in Backlog
|
||||||||||||||||
|
As of September 30,
|
|
% Change
|
|||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2017 vs 2016
|
|
2016 vs 2015
|
||||||||
East
|
|
1,544
|
|
|
1,301
|
|
|
1,430
|
|
|
19
|
%
|
|
(9
|
)%
|
|||
Midwest
|
|
419
|
|
|
470
|
|
|
412
|
|
|
(11
|
)%
|
|
14
|
%
|
|||
Southeast
|
|
4,057
|
|
|
4,053
|
|
|
3,511
|
|
|
—
|
%
|
|
15
|
%
|
|||
South Central
|
|
3,956
|
|
|
3,840
|
|
|
3,656
|
|
|
3
|
%
|
|
5
|
%
|
|||
Southwest
|
|
843
|
|
|
655
|
|
|
571
|
|
|
29
|
%
|
|
15
|
%
|
|||
West
|
|
1,510
|
|
|
1,156
|
|
|
1,082
|
|
|
31
|
%
|
|
7
|
%
|
|||
|
|
12,329
|
|
|
11,475
|
|
|
10,662
|
|
|
7
|
%
|
|
8
|
%
|
|||
|
|
Value (In millions)
|
||||||||||||||||
East
|
|
$
|
452.8
|
|
|
$
|
383.0
|
|
|
$
|
413.0
|
|
|
18
|
%
|
|
(7
|
)%
|
Midwest
|
|
172.5
|
|
|
184.0
|
|
|
166.4
|
|
|
(6
|
)%
|
|
11
|
%
|
|||
Southeast
|
|
1,104.9
|
|
|
1,121.7
|
|
|
977.9
|
|
|
(1
|
)%
|
|
15
|
%
|
|||
South Central
|
|
1,018.1
|
|
|
1,018.1
|
|
|
951.3
|
|
|
—
|
%
|
|
7
|
%
|
|||
Southwest
|
|
192.7
|
|
|
150.7
|
|
|
124.0
|
|
|
28
|
%
|
|
22
|
%
|
|||
West
|
|
785.0
|
|
|
580.5
|
|
|
514.2
|
|
|
35
|
%
|
|
13
|
%
|
|||
|
|
$
|
3,726.0
|
|
|
$
|
3,438.0
|
|
|
$
|
3,146.8
|
|
|
8
|
%
|
|
9
|
%
|
|
|
Average Selling Price
|
||||||||||||||||
East
|
|
$
|
293,300
|
|
|
$
|
294,400
|
|
|
$
|
288,800
|
|
|
—
|
%
|
|
2
|
%
|
Midwest
|
|
411,700
|
|
|
391,500
|
|
|
403,900
|
|
|
5
|
%
|
|
(3
|
)%
|
|||
Southeast
|
|
272,300
|
|
|
276,800
|
|
|
278,500
|
|
|
(2
|
)%
|
|
(1
|
)%
|
|||
South Central
|
|
257,400
|
|
|
265,100
|
|
|
260,200
|
|
|
(3
|
)%
|
|
2
|
%
|
|||
Southwest
|
|
228,600
|
|
|
230,100
|
|
|
217,200
|
|
|
(1
|
)%
|
|
6
|
%
|
|||
West
|
|
519,900
|
|
|
502,200
|
|
|
475,200
|
|
|
4
|
%
|
|
6
|
%
|
|||
|
|
$
|
302,200
|
|
|
$
|
299,600
|
|
|
$
|
295,100
|
|
|
1
|
%
|
|
2
|
%
|
Home Closings and Revenue
|
|
Homes Closed
|
||||||||||||||||
|
Fiscal Year Ended September 30,
|
|
% Change
|
|||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2017 vs 2016
|
|
2016 vs 2015
|
||||||||
East
|
|
5,796
|
|
|
5,126
|
|
|
4,880
|
|
|
13
|
%
|
|
5
|
%
|
|||
Midwest
|
|
1,892
|
|
|
1,708
|
|
|
1,811
|
|
|
11
|
%
|
|
(6
|
)%
|
|||
Southeast
|
|
15,571
|
|
|
13,303
|
|
|
11,093
|
|
|
17
|
%
|
|
20
|
%
|
|||
South Central
|
|
13,258
|
|
|
12,249
|
|
|
11,455
|
|
|
8
|
%
|
|
7
|
%
|
|||
Southwest
|
|
2,505
|
|
|
1,703
|
|
|
1,499
|
|
|
47
|
%
|
|
14
|
%
|
|||
West
|
|
6,729
|
|
|
6,220
|
|
|
5,910
|
|
|
8
|
%
|
|
5
|
%
|
|||
|
|
45,751
|
|
|
40,309
|
|
|
36,648
|
|
|
14
|
%
|
|
10
|
%
|
|||
|
|
Home Sales Revenue (In millions)
|
||||||||||||||||
East
|
|
$
|
1,639.1
|
|
|
$
|
1,431.0
|
|
|
$
|
1,323.5
|
|
|
15
|
%
|
|
8
|
%
|
Midwest
|
|
734.1
|
|
|
651.7
|
|
|
665.9
|
|
|
13
|
%
|
|
(2
|
)%
|
|||
Southeast
|
|
4,085.7
|
|
|
3,459.3
|
|
|
2,866.2
|
|
|
18
|
%
|
|
21
|
%
|
|||
South Central
|
|
3,339.1
|
|
|
2,978.5
|
|
|
2,690.1
|
|
|
12
|
%
|
|
11
|
%
|
|||
Southwest
|
|
578.5
|
|
|
388.1
|
|
|
336.1
|
|
|
49
|
%
|
|
15
|
%
|
|||
West
|
|
3,276.7
|
|
|
2,874.5
|
|
|
2,587.6
|
|
|
14
|
%
|
|
11
|
%
|
|||
|
|
$
|
13,653.2
|
|
|
$
|
11,783.1
|
|
|
$
|
10,469.4
|
|
|
16
|
%
|
|
13
|
%
|
|
|
Average Selling Price
|
||||||||||||||||
East
|
|
$
|
282,800
|
|
|
$
|
279,200
|
|
|
$
|
271,200
|
|
|
1
|
%
|
|
3
|
%
|
Midwest
|
|
388,000
|
|
|
381,600
|
|
|
367,700
|
|
|
2
|
%
|
|
4
|
%
|
|||
Southeast
|
|
262,400
|
|
|
260,000
|
|
|
258,400
|
|
|
1
|
%
|
|
1
|
%
|
|||
South Central
|
|
251,900
|
|
|
243,200
|
|
|
234,800
|
|
|
4
|
%
|
|
4
|
%
|
|||
Southwest
|
|
230,900
|
|
|
227,900
|
|
|
224,200
|
|
|
1
|
%
|
|
2
|
%
|
|||
West
|
|
487,000
|
|
|
462,100
|
|
|
437,800
|
|
|
5
|
%
|
|
6
|
%
|
|||
|
|
$
|
298,400
|
|
|
$
|
292,300
|
|
|
$
|
285,700
|
|
|
2
|
%
|
|
2
|
%
|
|
|
Percentages of Related Revenues
|
|||||||
|
|
Fiscal Year Ended September 30,
|
|||||||
|
|
2017
|
|
2016
|
|
2015
|
|||
Gross profit — Home sales
|
|
20.0
|
%
|
|
20.2
|
%
|
|
19.8
|
%
|
Gross profit — Land/lot sales and other
|
|
15.3
|
%
|
|
13.3
|
%
|
|
8.7
|
%
|
Inventory and land option charges
|
|
(0.3
|
)%
|
|
(0.3
|
)%
|
|
(0.6
|
)%
|
Gross profit — Total homebuilding
|
|
19.6
|
%
|
|
19.9
|
%
|
|
19.2
|
%
|
Selling, general and administrative expense
|
|
8.9
|
%
|
|
9.3
|
%
|
|
9.5
|
%
|
Goodwill impairment
|
|
—
|
%
|
|
0.1
|
%
|
|
0.1
|
%
|
Other (income) expense
|
|
(0.1
|
)%
|
|
(0.1
|
)%
|
|
(0.1
|
)%
|
Homebuilding pre-tax income
|
|
10.8
|
%
|
|
10.7
|
%
|
|
9.6
|
%
|
|
|
Fiscal Year Ended September 30,
|
|||||||||||||||||||||||||||||||
|
|
Homebuilding Revenues
|
|
Homebuilding Pre-tax Income (1)
|
|
Pre-tax Income as a Percentage of Homebuilding Revenues
|
|||||||||||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
East
|
|
$
|
1,640.1
|
|
|
$
|
1,446.5
|
|
|
$
|
1,333.6
|
|
|
$
|
153.9
|
|
|
$
|
138.7
|
|
|
$
|
94.2
|
|
|
9.4
|
%
|
|
9.6
|
%
|
|
7.1
|
%
|
Midwest
|
|
736.5
|
|
|
651.7
|
|
|
666.1
|
|
|
49.1
|
|
|
44.3
|
|
|
49.8
|
|
|
6.7
|
%
|
|
6.8
|
%
|
|
7.5
|
%
|
||||||
Southeast
|
|
4,087.6
|
|
|
3,463.5
|
|
|
2,890.6
|
|
|
450.3
|
|
|
388.4
|
|
|
278.7
|
|
|
11.0
|
%
|
|
11.2
|
%
|
|
9.6
|
%
|
||||||
South Central
|
|
3,383.1
|
|
|
2,995.1
|
|
|
2,725.2
|
|
|
439.1
|
|
|
374.8
|
|
|
296.6
|
|
|
13.0
|
%
|
|
12.5
|
%
|
|
10.9
|
%
|
||||||
Southwest
|
|
597.5
|
|
|
388.1
|
|
|
336.1
|
|
|
39.6
|
|
|
7.3
|
|
|
13.1
|
|
|
6.6
|
%
|
|
1.9
|
%
|
|
3.9
|
%
|
||||||
West
|
|
3,296.7
|
|
|
2,916.9
|
|
|
2,607.4
|
|
|
357.3
|
|
|
310.9
|
|
|
285.9
|
|
|
10.8
|
%
|
|
10.7
|
%
|
|
11.0
|
%
|
||||||
|
|
$
|
13,741.5
|
|
|
$
|
11,861.8
|
|
|
$
|
10,559.0
|
|
|
$
|
1,489.3
|
|
|
$
|
1,264.4
|
|
|
$
|
1,018.3
|
|
|
10.8
|
%
|
|
10.7
|
%
|
|
9.6
|
%
|
(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 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 expenses associated with the corporate office are allocated to each segment based on the segment’s inventory balances.
|
|
|
September 30, 2017
|
||||||||||||||||||
|
|
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
|
|
$
|
569.3
|
|
|
$
|
478.1
|
|
|
$
|
21.0
|
|
|
$
|
0.5
|
|
|
$
|
1,068.9
|
|
Midwest
|
|
335.8
|
|
|
155.0
|
|
|
1.8
|
|
|
—
|
|
|
492.6
|
|
|||||
Southeast
|
|
1,265.6
|
|
|
1,085.0
|
|
|
35.9
|
|
|
5.8
|
|
|
2,392.3
|
|
|||||
South Central
|
|
1,050.8
|
|
|
1,132.6
|
|
|
14.1
|
|
|
1.9
|
|
|
2,199.4
|
|
|||||
Southwest
|
|
203.9
|
|
|
299.5
|
|
|
2.7
|
|
|
—
|
|
|
506.1
|
|
|||||
West
|
|
1,070.0
|
|
|
1,257.3
|
|
|
23.2
|
|
|
2.0
|
|
|
2,352.5
|
|
|||||
Corporate and unallocated (1)
|
|
110.6
|
|
|
112.2
|
|
|
2.3
|
|
|
0.2
|
|
|
225.3
|
|
|||||
|
|
$
|
4,606.0
|
|
|
$
|
4,519.7
|
|
|
$
|
101.0
|
|
|
$
|
10.4
|
|
|
$
|
9,237.1
|
|
|
|
September 30, 2016
|
||||||||||||||||||
|
|
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
|
|
$
|
448.9
|
|
|
$
|
415.4
|
|
|
$
|
26.8
|
|
|
$
|
—
|
|
|
$
|
891.1
|
|
Midwest
|
|
239.3
|
|
|
189.5
|
|
|
11.9
|
|
|
0.5
|
|
|
441.2
|
|
|||||
Southeast
|
|
1,149.8
|
|
|
870.1
|
|
|
44.8
|
|
|
5.6
|
|
|
2,070.3
|
|
|||||
South Central
|
|
1,009.6
|
|
|
1,032.0
|
|
|
14.6
|
|
|
19.4
|
|
|
2,075.6
|
|
|||||
Southwest
|
|
163.8
|
|
|
189.6
|
|
|
14.1
|
|
|
3.6
|
|
|
371.1
|
|
|||||
West
|
|
906.6
|
|
|
1,315.2
|
|
|
22.5
|
|
|
3.3
|
|
|
2,247.6
|
|
|||||
Corporate and unallocated (1)
|
|
116.7
|
|
|
123.4
|
|
|
3.1
|
|
|
0.8
|
|
|
244.0
|
|
|||||
|
|
$
|
4,034.7
|
|
|
$
|
4,135.2
|
|
|
$
|
137.8
|
|
|
$
|
33.2
|
|
|
$
|
8,340.9
|
|
(1)
|
Corporate and unallocated inventory consists primarily of capitalized interest and property taxes.
|
|
|
September 30, 2017
|
|||||||||
|
|
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
|
|
13,200
|
|
|
17,800
|
|
|
31,000
|
|
|
3,500
|
Midwest
|
|
2,600
|
|
|
4,400
|
|
|
7,000
|
|
|
1,500
|
Southeast
|
|
35,800
|
|
|
47,500
|
|
|
83,300
|
|
|
8,500
|
South Central
|
|
42,800
|
|
|
38,700
|
|
|
81,500
|
|
|
7,300
|
Southwest
|
|
8,700
|
|
|
2,400
|
|
|
11,100
|
|
|
1,700
|
West
|
|
21,900
|
|
|
13,200
|
|
|
35,100
|
|
|
3,700
|
|
|
125,000
|
|
|
124,000
|
|
|
249,000
|
|
|
26,200
|
|
|
50
|
%
|
|
50
|
%
|
|
100
|
%
|
|
|
|
|
September 30, 2016
|
|||||||||
|
|
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
|
|
13,400
|
|
|
15,100
|
|
|
28,500
|
|
|
3,000
|
Midwest
|
|
3,200
|
|
|
2,100
|
|
|
5,300
|
|
|
1,200
|
Southeast
|
|
30,600
|
|
|
36,100
|
|
|
66,700
|
|
|
7,600
|
South Central
|
|
37,700
|
|
|
25,100
|
|
|
62,800
|
|
|
7,000
|
Southwest
|
|
7,500
|
|
|
2,000
|
|
|
9,500
|
|
|
1,300
|
West
|
|
20,500
|
|
|
11,200
|
|
|
31,700
|
|
|
3,000
|
|
|
112,900
|
|
|
91,600
|
|
|
204,500
|
|
|
23,100
|
|
|
55
|
%
|
|
45
|
%
|
|
100
|
%
|
|
|
(1)
|
Land/lots owned include approximately
33,200
and
30,400
owned lots that are fully developed and ready for home construction at
September 30, 2017
and
2016
, respectively. Land/lots owned also include land held for development representing
4,800
and
7,300
lots at
September 30, 2017
and
2016
, respectively.
|
(2)
|
The total remaining purchase price of lots controlled through land and lot option purchase contracts at
September 30, 2017
and
2016
was
$4.6 billion
and
$3.6 billion
, respectively, secured by earnest money deposits of
$227.6 million
and
$167.0 million
, respectively. Our lots controlled under land and lot option purchase contracts exclude approximately
300
and
700
lots at
September 30, 2017
and
2016
, 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
1,600
model homes at both
September 30, 2017
and
2016
. Approximately
13,800
and
11,800
of our homes in inventory were unsold at
September 30, 2017
and
2016
, respectively. At
September 30, 2017
, approximately
4,100
of our unsold homes were completed, of which approximately
500
homes had been completed for more than six months. At
September 30, 2016
, approximately
3,500
of our unsold homes were completed, of which approximately
500
homes had been completed for more than six months.
|
|
|
Fiscal Year Ended September 30,
|
|
2017 vs 2016
|
|
2016 vs 2015
|
|||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
|
|||||||
Number of first-lien loans originated or brokered by DHI Mortgage for D.R. Horton homebuyers
|
|
25,488
|
|
|
21,970
|
|
|
18,821
|
|
|
16
|
%
|
|
17
|
%
|
Number of homes closed by D.R. Horton
|
|
45,751
|
|
|
40,309
|
|
|
36,648
|
|
|
14
|
%
|
|
10
|
%
|
Percentage of D.R. Horton homes financed by DHI Mortgage
|
|
56
|
%
|
|
55
|
%
|
|
51
|
%
|
|
|
|
|
|
|
Number of total loans originated or brokered by DHI Mortgage for D.R. Horton homebuyers
|
|
25,677
|
|
|
22,127
|
|
|
18,963
|
|
|
16
|
%
|
|
17
|
%
|
Total number of loans originated or brokered by DHI Mortgage
|
|
27,002
|
|
|
23,920
|
|
|
21,314
|
|
|
13
|
%
|
|
12
|
%
|
Captive business percentage
|
|
95
|
%
|
|
93
|
%
|
|
89
|
%
|
|
|
|
|
|
|
Loans sold by DHI Mortgage to third parties
|
|
27,251
|
|
|
23,926
|
|
|
20,623
|
|
|
14
|
%
|
|
16
|
%
|
|
|
Fiscal Year Ended September 30,
|
|
2017 vs 2016
|
|
2016 vs 2015
|
||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
|
||||||||||
|
|
(In millions)
|
|
|
|
|
||||||||||||
Loan origination fees
|
|
$
|
17.7
|
|
|
$
|
20.1
|
|
|
$
|
23.6
|
|
|
(12
|
)%
|
|
(15
|
)%
|
Sale of servicing rights and gains from sale of mortgage loans
|
|
254.0
|
|
|
216.0
|
|
|
173.0
|
|
|
18
|
%
|
|
25
|
%
|
|||
Recourse (expense) benefit
|
|
(2.9
|
)
|
|
(8.5
|
)
|
|
9.8
|
|
|
(66
|
)%
|
|
(187
|
)%
|
|||
Sale of servicing rights and gains from sale of mortgage loans, net
|
|
251.1
|
|
|
207.5
|
|
|
182.8
|
|
|
21
|
%
|
|
14
|
%
|
|||
Other revenues
|
|
16.5
|
|
|
14.6
|
|
|
13.6
|
|
|
13
|
%
|
|
7
|
%
|
|||
Total mortgage operations revenues
|
|
285.3
|
|
|
242.2
|
|
|
220.0
|
|
|
18
|
%
|
|
10
|
%
|
|||
Title policy premiums
|
|
64.2
|
|
|
53.4
|
|
|
45.0
|
|
|
20
|
%
|
|
19
|
%
|
|||
Total revenues
|
|
349.5
|
|
|
295.6
|
|
|
265.0
|
|
|
18
|
%
|
|
12
|
%
|
|||
General and administrative expense
|
|
251.2
|
|
|
220.0
|
|
|
183.0
|
|
|
14
|
%
|
|
20
|
%
|
|||
Interest and other (income) expense
|
|
(14.5
|
)
|
|
(13.5
|
)
|
|
(23.1
|
)
|
|
7
|
%
|
|
(42
|
)%
|
|||
Financial services and other pre-tax income
|
|
$
|
112.8
|
|
|
$
|
89.1
|
|
|
$
|
105.1
|
|
|
27
|
%
|
|
(15
|
)%
|
|
|
Percentages of
Financial Services Revenues (1)
|
|||||||
|
|
Fiscal Year Ended September 30,
|
|||||||
|
|
2017
|
|
2016
|
|
2015
|
|||
Recourse expense (benefit)
|
|
0.8
|
%
|
|
2.8
|
%
|
|
(3.8
|
)%
|
General and administrative expense
|
|
71.3
|
%
|
|
72.3
|
%
|
|
71.7
|
%
|
Interest and other (income) expense
|
|
(4.1
|
)%
|
|
(4.4
|
)%
|
|
(9.1
|
)%
|
Financial services and other pre-tax income
|
|
32.0
|
%
|
|
29.3
|
%
|
|
41.2
|
%
|
(1)
|
Excludes the effects of recourse expense or benefit on financial services revenues.
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less Than
1 Year
|
|
1 - 3 Years
|
|
3 - 5 Years
|
|
More Than
5 Years
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Notes Payable — Principal (1)
|
$
|
2,461.1
|
|
|
$
|
409.6
|
|
|
$
|
1,001.5
|
|
|
$
|
350.0
|
|
|
$
|
700.0
|
|
Notes Payable — Interest (1)
|
367.8
|
|
|
97.3
|
|
|
140.5
|
|
|
104.5
|
|
|
25.5
|
|
|||||
Operating Leases
|
36.2
|
|
|
14.7
|
|
|
14.2
|
|
|
6.2
|
|
|
1.1
|
|
|||||
Purchase Obligations (2)
|
29.7
|
|
|
27.4
|
|
|
2.3
|
|
|
—
|
|
|
—
|
|
|||||
|
$
|
2,894.8
|
|
|
$
|
549.0
|
|
|
$
|
1,158.5
|
|
|
$
|
460.7
|
|
|
$
|
726.6
|
|
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Notes Payable — Principal (3)
|
$
|
420.0
|
|
|
$
|
420.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Notes Payable — Interest (3)
|
13.9
|
|
|
13.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating Leases
|
2.6
|
|
|
0.8
|
|
|
1.3
|
|
|
0.5
|
|
|
—
|
|
|||||
|
$
|
436.5
|
|
|
$
|
434.7
|
|
|
$
|
1.3
|
|
|
$
|
0.5
|
|
|
$
|
—
|
|
(1)
|
Homebuilding notes payable represent principal and interest payments due on our senior notes and our secured notes. Because the balance of our revolving credit facility was
zero
at
September 30, 2017
, we did not assume any principal or interest payments related to this facility in future periods.
|
(2)
|
Purchase obligations relate to our land and lot option purchase contracts which enable us to control significant lot positions with limited capital investment. Among our land and lot option purchase contracts at
September 30, 2017
, there were a limited number of contracts, representing
$29.7 million
of remaining purchase price, subject to specific performance provisions which may require us to purchase the land or lots upon the land sellers meeting their contractual obligations. Further information about our land option contracts is provided in the “Inventories, Land and Lot Position and Homes in Inventory” section included herein.
|
(3)
|
Financial services notes payable represent principal and interest payments due on our mortgage subsidiary’s repurchase facility. The interest obligation associated with this variable rate facility is based on its annual effective rate of
3.3%
and principal balance outstanding at
September 30, 2017
.
|
•
|
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 provided by government agencies, changes in government financing 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;
|
•
|
our ability to effect our growth strategies, acquisitions or investments successfully;
|
•
|
home warranty and construction defect claims;
|
•
|
the effects of a health and safety incident;
|
•
|
the effects of negative publicity;
|
•
|
supply shortages and other risks of acquiring land, building materials and skilled labor;
|
•
|
the impact of an inflationary, deflationary or higher interest rate environment;
|
•
|
reductions in the availability of performance bonds;
|
•
|
increases in the costs of owning a home;
|
•
|
the effects of governmental regulations and environmental matters on our homebuilding operations;
|
•
|
the effects of governmental regulations on our financial services operations;
|
•
|
our significant debt and our ability to comply with related debt covenants, restrictions and limitations;
|
•
|
competitive conditions within the homebuilding and financial services industries;
|
•
|
the effects of the loss of key personnel; and
|
•
|
information technology failures and data security breaches.
|
•
|
gross margins on homes closed in recent months;
|
•
|
projected gross margins on homes sold but not closed;
|
•
|
projected gross margins based on community budgets;
|
•
|
trends in gross margins, average selling prices or cost of sales;
|
•
|
sales absorption rates; and
|
•
|
performance of other communities in nearby locations.
|
•
|
supply and availability of new and existing homes;
|
•
|
location and desirability of our communities;
|
•
|
variety of product types offered in the area;
|
•
|
pricing and use of incentives by us and our competitors;
|
•
|
alternative uses for our land or communities such as the sale of land, finished lots or home sites to third parties;
|
•
|
amount of land and lots we own or control in a particular market or sub-market; and
|
•
|
local economic and demographic trends.
|
•
|
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.
|
•
|
Level 3 — Valuation is typically derived from model-based techniques in which at least one significant input is unobservable and based on our own estimates about the assumptions that market participants would use to value the asset or liability.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
|
|
Fiscal Year Ending September 30,
|
|
|
|
|
|
Fair Value at September 30, 2017
|
||||||||||||||||||||||||
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Thereafter
|
|
Total
|
|
|||||||||||||||||
|
|
($ in millions)
|
||||||||||||||||||||||||||||||
Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed rate
|
|
$
|
409.6
|
|
|
$
|
500.8
|
|
|
$
|
500.7
|
|
|
$
|
—
|
|
|
$
|
350.0
|
|
|
$
|
700.0
|
|
|
$
|
2,461.1
|
|
|
$
|
2,595.2
|
|
Average interest rate
|
|
3.8
|
%
|
|
3.9
|
%
|
|
4.2
|
%
|
|
—
|
%
|
|
4.5
|
%
|
|
5.5
|
%
|
|
4.5
|
%
|
|
|
|||||||||
Variable rate
|
|
$
|
420.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
420.0
|
|
|
$
|
420.0
|
|
Average interest rate
|
|
3.3
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
3.3
|
%
|
|
|
ITEM 8.
|
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
ASSETS
|
|
|
|
||||
Homebuilding:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
973.0
|
|
|
$
|
1,271.8
|
|
Restricted cash
|
9.3
|
|
|
9.5
|
|
||
Inventories:
|
|
|
|
|
|
||
Construction in progress and finished homes
|
4,606.0
|
|
|
4,034.7
|
|
||
Residential land and lots — developed and under development
|
4,519.7
|
|
|
4,135.2
|
|
||
Land held for development
|
101.0
|
|
|
137.8
|
|
||
Land held for sale
|
10.4
|
|
|
33.2
|
|
||
|
9,237.1
|
|
|
8,340.9
|
|
||
Deferred income taxes, net of valuation allowance of $11.2 million
and $10.3 million at September 30, 2017 and 2016, respectively
|
365.0
|
|
|
476.3
|
|
||
Property and equipment, net
|
194.4
|
|
|
139.5
|
|
||
Other assets
|
518.7
|
|
|
456.2
|
|
||
Goodwill
|
80.0
|
|
|
80.0
|
|
||
|
11,377.5
|
|
|
10,774.2
|
|
||
Financial Services and Other:
|
|
|
|
|
|
||
Cash and cash equivalents
|
34.8
|
|
|
31.4
|
|
||
Mortgage loans held for sale
|
587.3
|
|
|
654.0
|
|
||
Property and equipment, net
|
130.6
|
|
|
55.9
|
|
||
Other assets
|
54.4
|
|
|
43.4
|
|
||
|
807.1
|
|
|
784.7
|
|
||
Total assets
|
$
|
12,184.6
|
|
|
$
|
11,558.9
|
|
LIABILITIES
|
|
|
|
||||
Homebuilding:
|
|
|
|
|
|
||
Accounts payable
|
$
|
575.6
|
|
|
$
|
537.0
|
|
Accrued expenses and other liabilities
|
933.1
|
|
|
917.1
|
|
||
Notes payable
|
2,451.6
|
|
|
2,798.3
|
|
||
|
3,960.3
|
|
|
4,252.4
|
|
||
Financial Services and Other:
|
|
|
|
|
|
||
Accounts payable and other liabilities
|
56.7
|
|
|
40.5
|
|
||
Mortgage repurchase facility
|
420.0
|
|
|
473.0
|
|
||
|
476.7
|
|
|
513.5
|
|
||
Total liabilities
|
4,437.0
|
|
|
4,765.9
|
|
||
Commitments and contingencies (Note K)
|
|
|
|
|
|
||
EQUITY
|
|
|
|
||||
Preferred stock, $.10 par value, 30,000,000 shares authorized, no shares issued
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, 1,000,000,000 shares authorized,
384,036,150 shares issued and 374,986,079 shares outstanding at September 30, 2017
and 380,123,258 shares issued and 372,923,187 shares outstanding at September 30, 2016
|
3.8
|
|
|
3.8
|
|
||
Additional paid-in capital
|
2,992.2
|
|
|
2,865.8
|
|
||
Retained earnings
|
4,946.0
|
|
|
4,057.2
|
|
||
Treasury stock, 9,050,071 shares and 7,200,071 shares at September 30, 2017 and 2016, respectively, at cost
|
(194.9
|
)
|
|
(134.3
|
)
|
||
Stockholders’ equity
|
7,747.1
|
|
|
6,792.5
|
|
||
Noncontrolling interests
|
0.5
|
|
|
0.5
|
|
||
Total equity
|
7,747.6
|
|
|
6,793.0
|
|
||
Total liabilities and equity
|
$
|
12,184.6
|
|
|
$
|
11,558.9
|
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In millions, except per share data)
|
||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|||
Revenues:
|
|
|
|
|
|
|
|
|
|||
Home sales
|
$
|
13,653.2
|
|
|
$
|
11,783.1
|
|
|
$
|
10,469.4
|
|
Land/lot sales and other
|
88.3
|
|
|
78.7
|
|
|
89.6
|
|
|||
|
13,741.5
|
|
|
11,861.8
|
|
|
10,559.0
|
|
|||
Cost of sales:
|
|
|
|
|
|
|
|
|
|||
Home sales
|
10,927.8
|
|
|
9,403.0
|
|
|
8,393.6
|
|
|||
Land/lot sales and other
|
74.8
|
|
|
68.2
|
|
|
81.8
|
|
|||
Inventory and land option charges
|
40.2
|
|
|
31.4
|
|
|
60.3
|
|
|||
|
11,042.8
|
|
|
9,502.6
|
|
|
8,535.7
|
|
|||
Gross profit:
|
|
|
|
|
|
|
|
|
|||
Home sales
|
2,725.4
|
|
|
2,380.1
|
|
|
2,075.8
|
|
|||
Land/lot sales and other
|
13.5
|
|
|
10.5
|
|
|
7.8
|
|
|||
Inventory and land option charges
|
(40.2
|
)
|
|
(31.4
|
)
|
|
(60.3
|
)
|
|||
|
2,698.7
|
|
|
2,359.2
|
|
|
2,023.3
|
|
|||
Selling, general and administrative expense
|
1,220.4
|
|
|
1,100.3
|
|
|
1,003.0
|
|
|||
Goodwill impairment
|
—
|
|
|
7.2
|
|
|
9.8
|
|
|||
Other (income) expense
|
(11.0
|
)
|
|
(12.7
|
)
|
|
(7.8
|
)
|
|||
Homebuilding pre-tax income
|
1,489.3
|
|
|
1,264.4
|
|
|
1,018.3
|
|
|||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|||
Revenues
|
349.5
|
|
|
295.6
|
|
|
265.0
|
|
|||
General and administrative expense
|
251.2
|
|
|
220.0
|
|
|
183.0
|
|
|||
Interest and other (income) expense
|
(14.5
|
)
|
|
(13.5
|
)
|
|
(23.1
|
)
|
|||
Financial services and other pre-tax income
|
112.8
|
|
|
89.1
|
|
|
105.1
|
|
|||
Income before income taxes
|
1,602.1
|
|
|
1,353.5
|
|
|
1,123.4
|
|
|||
Income tax expense
|
563.7
|
|
|
467.2
|
|
|
372.7
|
|
|||
Net income
|
$
|
1,038.4
|
|
|
$
|
886.3
|
|
|
$
|
750.7
|
|
Other comprehensive income (loss), net of income tax:
|
|
|
|
|
|
|
|
|
|||
Debt securities collateralized by residential real estate:
|
|
|
|
|
|
||||||
Net change in unrealized gain (loss)
|
—
|
|
|
1.2
|
|
|
(0.8
|
)
|
|||
Reclassification adjustment for net gain realized in net income
|
—
|
|
|
(2.6
|
)
|
|
—
|
|
|||
Comprehensive income
|
$
|
1,038.4
|
|
|
$
|
884.9
|
|
|
$
|
749.9
|
|
Basic net income per common share
|
$
|
2.77
|
|
|
$
|
2.39
|
|
|
$
|
2.05
|
|
Net income per common share assuming dilution
|
$
|
2.74
|
|
|
$
|
2.36
|
|
|
$
|
2.03
|
|
Cash dividends declared per common share
|
$
|
0.40
|
|
|
$
|
0.32
|
|
|
$
|
0.25
|
|
|
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
Income
|
|
Non-controlling
Interests
|
|
Total
Equity
|
||||||||||||||
|
(In millions, except common stock share data)
|
||||||||||||||||||||||||||
Balances at September 30, 2014 (364,586,694 shares)
|
$
|
3.7
|
|
|
$
|
2,613.7
|
|
|
$
|
2,630.5
|
|
|
$
|
(134.3
|
)
|
|
$
|
2.2
|
|
|
$
|
3.9
|
|
|
$
|
5,119.7
|
|
Net income
|
—
|
|
|
—
|
|
|
750.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
750.7
|
|
|||||||
Issuances under employee benefit plans (82,446 shares)
|
—
|
|
|
1.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.7
|
|
|||||||
Exercise of stock options (3,636,655 shares)
|
0.1
|
|
|
60.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
60.1
|
|
|||||||
Tax benefit from employee stock awards
|
—
|
|
|
7.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7.9
|
|
|||||||
Stock issued under employee incentive plans, net of shares withheld for employee taxes (341,576 shares)
|
—
|
|
|
8.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.3
|
|
|||||||
Stock-based compensation expense
|
—
|
|
|
42.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42.2
|
|
|||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(91.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(91.6
|
)
|
|||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|
—
|
|
|
(0.8
|
)
|
|||||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.8
|
)
|
|
(2.8
|
)
|
|||||||
Balances at September 30, 2015 (368,647,371 shares)
|
$
|
3.8
|
|
|
$
|
2,733.8
|
|
|
$
|
3,289.6
|
|
|
$
|
(134.3
|
)
|
|
$
|
1.4
|
|
|
$
|
1.1
|
|
|
$
|
5,895.4
|
|
Net income
|
—
|
|
|
—
|
|
|
886.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
886.3
|
|
|||||||
Issuances under employee benefit plans (89,652 shares)
|
—
|
|
|
2.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.2
|
|
|||||||
Exercise of stock options (3,504,989 shares)
|
—
|
|
|
70.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
70.1
|
|
|||||||
Tax benefit from employee stock awards
|
—
|
|
|
2.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.7
|
|
|||||||
Stock issued under employee incentive plans, net of shares withheld for employee taxes (681,175 shares)
|
—
|
|
|
8.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.0
|
|
|||||||
Stock-based compensation expense
|
—
|
|
|
49.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
49.0
|
|
|||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(118.7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(118.7
|
)
|
|||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.4
|
)
|
|
—
|
|
|
(1.4
|
)
|
|||||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|
(0.6
|
)
|
|||||||
Balances at September 30, 2016 (372,923,187 shares)
|
$
|
3.8
|
|
|
$
|
2,865.8
|
|
|
$
|
4,057.2
|
|
|
$
|
(134.3
|
)
|
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
6,793.0
|
|
Net income
|
—
|
|
|
—
|
|
|
1,038.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,038.4
|
|
|||||||
Issuances under employee benefit plans (111,527 shares)
|
—
|
|
|
2.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
|||||||
Exercise of stock options (2,770,569 shares)
|
—
|
|
|
43.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
43.8
|
|
|||||||
Tax benefit from employee stock awards
|
—
|
|
|
13.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13.7
|
|
|||||||
Stock issued under employee incentive plans, net of shares withheld for employee taxes (1,030,796 shares)
|
—
|
|
|
6.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.9
|
|
|||||||
Stock-based compensation expense
|
—
|
|
|
59.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59.2
|
|
|||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
(149.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(149.6
|
)
|
|||||||
Repurchases of common stock (1,850,000 shares)
|
—
|
|
|
—
|
|
|
—
|
|
|
(60.6
|
)
|
|
—
|
|
|
—
|
|
|
(60.6
|
)
|
|||||||
Balances at September 30, 2017 (374,986,079 shares)
|
$
|
3.8
|
|
|
$
|
2,992.2
|
|
|
$
|
4,946.0
|
|
|
$
|
(194.9
|
)
|
|
$
|
—
|
|
|
$
|
0.5
|
|
|
$
|
7,747.6
|
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In millions)
|
||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Net income
|
$
|
1,038.4
|
|
|
$
|
886.3
|
|
|
$
|
750.7
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization
|
54.7
|
|
|
61.0
|
|
|
54.1
|
|
|||
Amortization of discounts and fees
|
5.0
|
|
|
5.4
|
|
|
5.6
|
|
|||
Stock-based compensation expense
|
59.2
|
|
|
49.0
|
|
|
42.2
|
|
|||
Excess income tax benefit from employee stock awards
|
(14.3
|
)
|
|
(10.0
|
)
|
|
(12.3
|
)
|
|||
Deferred income taxes
|
110.8
|
|
|
75.3
|
|
|
3.1
|
|
|||
Inventory and land option charges
|
40.2
|
|
|
31.4
|
|
|
60.3
|
|
|||
Gain on sale of debt securities collateralized by residential real estate
|
—
|
|
|
(4.5
|
)
|
|
—
|
|
|||
Goodwill impairment
|
—
|
|
|
7.2
|
|
|
9.8
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|||
(Increase) decrease in construction in progress and finished homes
|
(584.4
|
)
|
|
(496.2
|
)
|
|
63.1
|
|
|||
Increase in residential land and lots —
developed, under development, held for development and held for sale
|
(362.3
|
)
|
|
(10.3
|
)
|
|
(152.6
|
)
|
|||
Increase in other assets
|
(63.7
|
)
|
|
(16.3
|
)
|
|
(29.8
|
)
|
|||
Decrease (increase) in mortgage loans held for sale
|
67.6
|
|
|
(12.4
|
)
|
|
(154.1
|
)
|
|||
Increase in accounts payable, accrued expenses and other liabilities
|
83.9
|
|
|
52.1
|
|
|
60.3
|
|
|||
Net cash provided by operating activities
|
435.1
|
|
|
618.0
|
|
|
700.4
|
|
|||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Expenditures for property and equipment
|
(157.3
|
)
|
|
(86.1
|
)
|
|
(56.1
|
)
|
|||
Proceeds from the sale of property and equipment to a related party
|
—
|
|
|
—
|
|
|
56.0
|
|
|||
(Increase) decrease in restricted cash
|
(7.0
|
)
|
|
0.2
|
|
|
(0.7
|
)
|
|||
Net principal decrease (increase) of other mortgage loans and real estate owned
|
6.2
|
|
|
19.7
|
|
|
(8.9
|
)
|
|||
(Purchases of) proceeds from debt securities collateralized by residential real estate
|
(8.8
|
)
|
|
35.8
|
|
|
(14.8
|
)
|
|||
Payments related to acquisition of a business
|
(4.1
|
)
|
|
(82.2
|
)
|
|
(70.9
|
)
|
|||
Net cash used in investing activities
|
(171.0
|
)
|
|
(112.6
|
)
|
|
(95.4
|
)
|
|||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Proceeds from notes payable
|
835.0
|
|
|
—
|
|
|
1,590.7
|
|
|||
Repayment of notes payable
|
(1,245.3
|
)
|
|
(549.7
|
)
|
|
(1,456.2
|
)
|
|||
Proceeds from stock associated with certain employee benefit plans
|
46.7
|
|
|
72.4
|
|
|
61.8
|
|
|||
Excess income tax benefit from employee stock awards
|
14.3
|
|
|
10.0
|
|
|
12.3
|
|
|||
Cash dividends paid
|
(149.6
|
)
|
|
(118.7
|
)
|
|
(91.6
|
)
|
|||
Repurchases of common stock
|
(60.6
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash (used in) provided by financing activities
|
(559.5
|
)
|
|
(586.0
|
)
|
|
117.0
|
|
|||
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS
|
(295.4
|
)
|
|
(80.6
|
)
|
|
722.0
|
|
|||
Cash and cash equivalents at beginning of year
|
1,303.2
|
|
|
1,383.8
|
|
|
661.8
|
|
|||
Cash and cash equivalents at end of year
|
$
|
1,007.8
|
|
|
$
|
1,303.2
|
|
|
$
|
1,383.8
|
|
Supplemental cash flow information:
|
|
|
|
|
|
|
|
|
|||
Income taxes paid, net
|
$
|
446.4
|
|
|
$
|
389.9
|
|
|
$
|
334.0
|
|
Supplemental disclosures of non-cash activities:
|
|
|
|
|
|
|
|
|
|||
Notes payable issued for inventory
|
$
|
4.5
|
|
|
$
|
4.2
|
|
|
$
|
9.7
|
|
Stock issued under employee incentive plans
|
$
|
31.9
|
|
|
$
|
20.1
|
|
|
$
|
8.3
|
|
Accrued expenditures for property and equipment
|
$
|
16.3
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
Accrual for holdback payment related to acquisition
|
$
|
—
|
|
|
$
|
9.7
|
|
|
$
|
—
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Buildings and improvements (1)
|
$
|
219.0
|
|
|
$
|
158.4
|
|
Multi-family rental properties under construction (2)
|
59.2
|
|
|
8.3
|
|
||
Model home furniture
|
120.4
|
|
|
101.0
|
|
||
Office furniture and equipment
|
99.7
|
|
|
85.4
|
|
||
Land
|
52.9
|
|
|
37.8
|
|
||
Total property and equipment
|
551.2
|
|
|
390.9
|
|
||
Accumulated depreciation
|
(226.2
|
)
|
|
(195.5
|
)
|
||
Property and equipment, net
|
$
|
325.0
|
|
|
$
|
195.4
|
|
(1)
|
The current year balance includes
$15.3 million
related to the Company’s multi-family rental properties at
September 30, 2017
.
|
(2)
|
The prior year balance of
$8.3 million
, previously included in buildings and improvements, has been reclassified to conform to the current year presentation.
|
|
East:
|
|
Delaware, Georgia (Savannah only), Maryland, New Jersey, North Carolina, Pennsylvania, South Carolina and Virginia
|
|
Midwest:
|
|
Colorado, Illinois 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
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
(In millions)
|
|
|
||||||
Revenues
|
|
|
|
|
|
|
|
|
|||
Homebuilding revenues:
|
|
|
|
|
|
|
|
|
|||
East
|
$
|
1,640.1
|
|
|
$
|
1,446.5
|
|
|
$
|
1,333.6
|
|
Midwest
|
736.5
|
|
|
651.7
|
|
|
666.1
|
|
|||
Southeast
|
4,087.6
|
|
|
3,463.5
|
|
|
2,890.6
|
|
|||
South Central
|
3,383.1
|
|
|
2,995.1
|
|
|
2,725.2
|
|
|||
Southwest
|
597.5
|
|
|
388.1
|
|
|
336.1
|
|
|||
West
|
3,296.7
|
|
|
2,916.9
|
|
|
2,607.4
|
|
|||
Homebuilding revenues
|
13,741.5
|
|
|
11,861.8
|
|
|
10,559.0
|
|
|||
Financial services revenues
|
349.5
|
|
|
295.6
|
|
|
265.0
|
|
|||
Total revenues
|
$
|
14,091.0
|
|
|
$
|
12,157.4
|
|
|
$
|
10,824.0
|
|
Inventory Impairments
|
|
|
|
|
|
|
|
|
|||
East
|
$
|
10.5
|
|
|
$
|
12.3
|
|
|
$
|
14.3
|
|
Midwest
|
1.0
|
|
|
—
|
|
|
—
|
|
|||
Southeast
|
2.4
|
|
|
0.7
|
|
|
8.8
|
|
|||
South Central
|
1.6
|
|
|
1.0
|
|
|
1.4
|
|
|||
Southwest
|
1.4
|
|
|
6.0
|
|
|
—
|
|
|||
West
|
6.3
|
|
|
0.3
|
|
|
20.4
|
|
|||
Total inventory impairments
|
$
|
23.2
|
|
|
$
|
20.3
|
|
|
$
|
44.9
|
|
Income Before Income Taxes (1) (2)
|
|
|
|
|
|
|
|
|
|||
Homebuilding pre-tax income:
|
|
|
|
|
|
|
|
|
|||
East
|
$
|
153.9
|
|
|
$
|
138.7
|
|
|
$
|
94.2
|
|
Midwest
|
49.1
|
|
|
44.3
|
|
|
49.8
|
|
|||
Southeast
|
450.3
|
|
|
388.4
|
|
|
278.7
|
|
|||
South Central
|
439.1
|
|
|
374.8
|
|
|
296.6
|
|
|||
Southwest
|
39.6
|
|
|
7.3
|
|
|
13.1
|
|
|||
West
|
357.3
|
|
|
310.9
|
|
|
285.9
|
|
|||
Homebuilding pre-tax income
|
1,489.3
|
|
|
1,264.4
|
|
|
1,018.3
|
|
|||
Financial services pre-tax income
|
124.5
|
|
|
98.1
|
|
|
105.1
|
|
|||
Homebuilding and financial services pre-tax income
|
1,613.8
|
|
|
1,362.5
|
|
|
1,123.4
|
|
|||
Other pre-tax loss
|
(11.7
|
)
|
|
(9.0
|
)
|
|
—
|
|
|||
Income before income taxes
|
$
|
1,602.1
|
|
|
$
|
1,353.5
|
|
|
$
|
1,123.4
|
|
(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 expenses associated with the corporate office are allocated to each segment based on the segment’s inventory balances.
|
(2)
|
The operating results of certain subsidiaries that are immaterial for separate reporting are grouped together and presented as other.
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Homebuilding Inventories (1):
|
|
|
|
|
|
||
East
|
$
|
1,068.9
|
|
|
$
|
891.1
|
|
Midwest
|
492.6
|
|
|
441.2
|
|
||
Southeast
|
2,392.3
|
|
|
2,070.3
|
|
||
South Central
|
2,199.4
|
|
|
2,075.6
|
|
||
Southwest
|
506.1
|
|
|
371.1
|
|
||
West
|
2,352.5
|
|
|
2,247.6
|
|
||
Corporate and unallocated (2)
|
225.3
|
|
|
244.0
|
|
||
Total homebuilding inventories
|
$
|
9,237.1
|
|
|
$
|
8,340.9
|
|
(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.
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Homebuilding:
|
|
|
|
|
|
||
Unsecured:
|
|
|
|
|
|
||
Revolving credit facility, maturing 2022
|
$
|
—
|
|
|
$
|
—
|
|
4.75% senior notes due 2017
|
—
|
|
|
349.5
|
|
||
3.625% senior notes due 2018
|
399.7
|
|
|
398.9
|
|
||
3.75% senior notes due 2019
|
498.8
|
|
|
498.0
|
|
||
4.0% senior notes due 2020
|
497.9
|
|
|
497.1
|
|
||
4.375% senior notes due 2022
|
348.1
|
|
|
347.7
|
|
||
4.75% senior notes due 2023
|
298.4
|
|
|
298.2
|
|
||
5.75% senior notes due 2023
|
397.6
|
|
|
397.3
|
|
||
Other secured notes
|
11.1
|
|
|
11.6
|
|
||
|
$
|
2,451.6
|
|
|
$
|
2,798.3
|
|
Financial Services:
|
|
|
|
|
|
||
Mortgage repurchase facility, maturing 2018
|
$
|
420.0
|
|
|
$
|
473.0
|
|
Notes Payable
|
|
Principal Amount
|
|
Date Issued
|
|
Date Due
|
|
Redeemable
Prior to
Maturity (1)
|
|
Effective
Interest Rate (2)
|
|
|
(In millions)
|
|
|
|
|
|
|
|
|
3.625% senior notes
|
|
$400.0
|
|
February 2013
|
|
February 15, 2018
|
|
Yes
|
|
3.8%
|
3.75% senior notes
|
|
$500.0
|
|
February 2014
|
|
March 1, 2019
|
|
Yes
|
|
3.9%
|
4.0% senior notes
|
|
$500.0
|
|
February 2015
|
|
February 15, 2020
|
|
Yes
|
|
4.2%
|
4.375% senior notes
|
|
$350.0
|
|
September 2012
|
|
September 15, 2022
|
|
Yes
|
|
4.5%
|
4.75% senior notes
|
|
$300.0
|
|
February 2013
|
|
February 15, 2023
|
|
Yes
|
|
4.9%
|
5.75% senior notes
|
|
$400.0
|
|
August 2013
|
|
August 15, 2023
|
|
Yes
|
|
5.9%
|
(1)
|
The Company may redeem the notes in whole at any time or in part from time to time, at a redemption price equal to the greater of
100%
of their principal amount or the present value of the remaining scheduled payments on the redemption date, plus accrued and unpaid interest.
|
(2)
|
Interest is payable semi-annually on each of the series of senior notes. The annual effective interest rate is calculated after giving effect to the amortization of debt issuance costs.
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In millions)
|
||||||||||
Capitalized interest, beginning of year
|
$
|
191.2
|
|
|
$
|
208.0
|
|
|
$
|
198.5
|
|
Interest incurred (1)
|
129.3
|
|
|
152.3
|
|
|
169.2
|
|
|||
Interest charged to cost of sales
|
(152.6
|
)
|
|
(169.1
|
)
|
|
(159.7
|
)
|
|||
Capitalized interest, end of year
|
$
|
167.9
|
|
|
$
|
191.2
|
|
|
$
|
208.0
|
|
(1)
|
Interest incurred includes interest on the Company's mortgage repurchase facility of
$8.5 million
,
$8.4 million
and
$7.4 million
in fiscal
2017
,
2016
and
2015
, respectively.
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Other mortgage loans
|
$
|
8.3
|
|
|
$
|
15.6
|
|
Real estate owned
|
—
|
|
|
0.8
|
|
||
|
$
|
8.3
|
|
|
$
|
16.4
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Loss reserves related to:
|
|
|
|
|
|
||
Other mortgage loans
|
$
|
1.0
|
|
|
$
|
1.8
|
|
Real estate owned
|
—
|
|
|
0.1
|
|
||
Loan repurchase and settlement obligations - known and expected
|
7.7
|
|
|
6.8
|
|
||
|
$
|
8.7
|
|
|
$
|
8.7
|
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In millions)
|
||||||||||
Current tax expense:
|
|
|
|
|
|
|
|
|
|||
Federal
|
$
|
425.6
|
|
|
$
|
376.0
|
|
|
$
|
356.4
|
|
State
|
27.3
|
|
|
15.9
|
|
|
13.2
|
|
|||
|
452.9
|
|
|
391.9
|
|
|
369.6
|
|
|||
Deferred tax expense (benefit):
|
|
|
|
|
|
|
|
|
|||
Federal
|
87.9
|
|
|
47.6
|
|
|
(3.1
|
)
|
|||
State
|
22.9
|
|
|
27.7
|
|
|
6.2
|
|
|||
|
110.8
|
|
|
75.3
|
|
|
3.1
|
|
|||
Total income tax expense
|
$
|
563.7
|
|
|
$
|
467.2
|
|
|
$
|
372.7
|
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In millions)
|
||||||||||
Income taxes at federal statutory rate
|
$
|
560.7
|
|
|
$
|
473.7
|
|
|
$
|
393.2
|
|
Increase (decrease) in tax resulting from:
|
|
|
|
|
|
||||||
State income taxes, net of federal benefit
|
42.3
|
|
|
38.6
|
|
|
37.0
|
|
|||
Domestic production activities deduction
|
(39.8
|
)
|
|
(36.3
|
)
|
|
(35.7
|
)
|
|||
Valuation allowance
|
0.8
|
|
|
0.2
|
|
|
(21.0
|
)
|
|||
Tax credits
|
(3.5
|
)
|
|
(15.9
|
)
|
|
(2.2
|
)
|
|||
Other
|
3.2
|
|
|
6.9
|
|
|
1.4
|
|
|||
Total income tax expense
|
$
|
563.7
|
|
|
$
|
467.2
|
|
|
$
|
372.7
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Deferred tax assets:
|
|
|
|
|
|
||
Inventory costs
|
$
|
42.6
|
|
|
$
|
87.6
|
|
Inventory impairments
|
83.9
|
|
|
128.3
|
|
||
Warranty and construction defect costs
|
163.7
|
|
|
138.8
|
|
||
Net operating loss carryforwards
|
26.2
|
|
|
40.1
|
|
||
Tax credit carryforwards
|
2.5
|
|
|
2.9
|
|
||
Incentive compensation plans
|
92.6
|
|
|
82.2
|
|
||
Deferred income
|
1.7
|
|
|
2.2
|
|
||
Other
|
13.9
|
|
|
11.1
|
|
||
Total deferred tax assets
|
427.1
|
|
|
493.2
|
|
||
Valuation allowance
|
(11.2
|
)
|
|
(10.3
|
)
|
||
Total deferred tax assets, net of valuation allowance
|
415.9
|
|
|
482.9
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Deferral of profit on home sales
|
41.6
|
|
|
—
|
|
||
Other
|
9.3
|
|
|
6.6
|
|
||
Total deferred tax liabilities
|
$
|
50.9
|
|
|
$
|
6.6
|
|
Deferred income taxes, net
|
$
|
365.0
|
|
|
$
|
476.3
|
|
|
Year Ended September 30,
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
|
(In millions)
|
||||||||||
Numerator:
|
|
|
|
|
|
||||||
Net income
|
$
|
1,038.4
|
|
|
$
|
886.3
|
|
|
$
|
750.7
|
|
Denominator:
|
|
|
|
|
|
||||||
Denominator for basic earnings per share — weighted average common shares
|
374.3
|
|
|
371.0
|
|
|
366.3
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Employee stock awards
|
4.6
|
|
|
4.1
|
|
|
3.5
|
|
|||
Denominator for diluted earnings per share — adjusted weighted average common shares
|
378.9
|
|
|
375.1
|
|
|
369.8
|
|
|||
|
|
|
|
|
|
||||||
Basic net income per common share
|
$
|
2.77
|
|
|
$
|
2.39
|
|
|
$
|
2.05
|
|
Net income per common share assuming dilution
|
$
|
2.74
|
|
|
$
|
2.36
|
|
|
$
|
2.03
|
|
|
Year Ended September 30,
|
|||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
Stock Options
|
|
Weighted Average
Exercise Price
|
|
Stock Options
|
|
Weighted Average
Exercise Price
|
|
Stock Options
|
|
Weighted Average
Exercise Price
|
|||||||||
Outstanding at beginning of year
|
11,395,917
|
|
|
$
|
16.69
|
|
|
15,337,656
|
|
|
$
|
17.50
|
|
|
19,478,811
|
|
|
$
|
17.37
|
|
Exercised
|
(2,770,569
|
)
|
|
15.83
|
|
|
(3,504,989
|
)
|
|
20.02
|
|
|
(3,636,655
|
)
|
|
16.49
|
|
|||
Cancelled or expired
|
(194,000
|
)
|
|
18.83
|
|
|
(436,750
|
)
|
|
18.45
|
|
|
(504,500
|
)
|
|
19.89
|
|
|||
Outstanding at end of year
|
8,431,348
|
|
|
$
|
16.92
|
|
|
11,395,917
|
|
|
$
|
16.69
|
|
|
15,337,656
|
|
|
$
|
17.50
|
|
Exercisable at end of year
|
5,772,214
|
|
|
$
|
16.01
|
|
|
6,645,967
|
|
|
$
|
14.99
|
|
|
6,859,889
|
|
|
$
|
16.51
|
|
Grant Date
|
|
Vesting Date
|
|
Target Number of Performance Units
|
|
Grant Date Fair Value per Unit
|
|
Compensation Expense
Year Ended September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
|
|
|
|
|
|
|
(In millions)
|
||||||||||||
November 2014
|
|
September 2017
|
|
290,000
|
|
$
|
23.62
|
|
|
$
|
3.8
|
|
|
$
|
4.1
|
|
|
$
|
3.4
|
|
November 2015
|
|
September 2018
|
|
330,000
|
|
30.81
|
|
|
6.8
|
|
|
4.0
|
|
|
—
|
|
||||
November 2016
|
|
September 2019
|
|
330,000
|
|
29.20
|
|
|
5.1
|
|
|
—
|
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
$
|
15.7
|
|
|
$
|
8.1
|
|
|
$
|
3.4
|
|
|
Year Ended September 30,
|
|||||||||||||||||||
|
2017
|
|
2016
|
|
2015
|
|||||||||||||||
|
Number of
Restricted Stock Units
|
|
Weighted Average
Grant Date Fair Value
|
|
Number of
Restricted Stock Units
|
|
Weighted Average
Grant Date Fair Value
|
|
Number of
Restricted Stock Units
|
|
Weighted Average
Grant Date Fair Value
|
|||||||||
Outstanding at beginning of year
|
3,478,233
|
|
|
$
|
24.12
|
|
|
1,978,262
|
|
|
$
|
25.60
|
|
|
26,668
|
|
|
$
|
21.49
|
|
Granted
|
1,868,660
|
|
|
28.64
|
|
|
2,117,330
|
|
|
23.14
|
|
|
2,036,900
|
|
|
26.02
|
|
|||
Vested
|
(792,941
|
)
|
|
24.48
|
|
|
(423,427
|
)
|
|
25.57
|
|
|
(12,221
|
)
|
|
21.48
|
|
|||
Cancelled
|
(188,170
|
)
|
|
25.21
|
|
|
(193,932
|
)
|
|
25.05
|
|
|
(73,085
|
)
|
|
26.06
|
|
|||
Outstanding at end of year
|
4,365,782
|
|
|
$
|
26.09
|
|
|
3,478,233
|
|
|
$
|
24.12
|
|
|
1,978,262
|
|
|
$
|
25.60
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Warranty liability, beginning of year
|
$
|
104.4
|
|
|
$
|
82.0
|
|
Warranties issued
|
69.7
|
|
|
54.2
|
|
||
Changes in liability for pre-existing warranties
|
30.0
|
|
|
13.9
|
|
||
Settlements made
|
(60.4
|
)
|
|
(45.7
|
)
|
||
Warranty liability, end of year
|
$
|
143.7
|
|
|
$
|
104.4
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Reserves for legal claims, beginning of year
|
$
|
423.5
|
|
|
$
|
451.0
|
|
Increase in reserves
|
91.0
|
|
|
25.4
|
|
||
Payments
|
(93.9
|
)
|
|
(52.9
|
)
|
||
Reserves for legal claims, end of year
|
$
|
420.6
|
|
|
$
|
423.5
|
|
2018
|
$
|
15.5
|
|
2019
|
9.8
|
|
|
2020
|
5.7
|
|
|
2021
|
4.1
|
|
|
2022
|
2.6
|
|
|
Thereafter
|
1.1
|
|
|
|
$
|
38.8
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Earnest money and refundable deposits
|
$
|
303.1
|
|
|
$
|
219.7
|
|
Insurance receivables
|
74.4
|
|
|
88.7
|
|
||
Accounts and notes receivable
|
38.3
|
|
|
35.9
|
|
||
Prepaid assets
|
30.8
|
|
|
29.5
|
|
||
Rental properties
|
52.0
|
|
|
56.9
|
|
||
Other assets
|
20.1
|
|
|
25.5
|
|
||
|
$
|
518.7
|
|
|
$
|
456.2
|
|
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In millions)
|
||||||
Reserves for legal claims
|
$
|
420.6
|
|
|
$
|
423.5
|
|
Employee compensation and related liabilities
|
192.9
|
|
|
183.3
|
|
||
Warranty liability
|
143.7
|
|
|
104.4
|
|
||
Accrued interest
|
11.9
|
|
|
17.9
|
|
||
Federal and state income tax liabilities
|
20.3
|
|
|
28.1
|
|
||
Inventory related accruals
|
24.8
|
|
|
31.9
|
|
||
Homebuyer deposits
|
44.9
|
|
|
54.2
|
|
||
Accrued property taxes
|
33.5
|
|
|
35.2
|
|
||
Other liabilities
|
40.5
|
|
|
38.6
|
|
||
|
$
|
933.1
|
|
|
$
|
917.1
|
|
•
|
Level 1 – Valuation is based on quoted prices in active markets for identical assets and liabilities. The Company does not currently have any assets or liabilities measured at fair value using Level 1 inputs.
|
•
|
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
- The fair value of these loans is generally calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics. Closed mortgage loans are typically sold shortly after origination, which limits exposure to nonperformance by loan buyer counterparties to a short time period. In addition, the Company actively monitors the financial strength of its counterparties.
|
•
|
IRLCs
- The fair value of IRLCs is calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics. These valuations do not contain adjustments for expirations as any expired commitments are excluded from the fair value measurement. The Company generally only issues IRLCs for products that meet specific purchaser guidelines. Should any purchaser become insolvent, the Company would not be required to close the transaction based on the terms of the commitment. Since not all IRLCs will become closed loans, the Company adjusts its fair value measurements for the estimated amount of IRLCs that will not close.
|
•
|
Loan sale commitments and hedging instruments
- The fair values of best-efforts and mandatory loan sale commitments and derivative instruments such as forward sales of MBS that are utilized as hedging instruments are calculated by reference to quoted prices for similar assets. The Company mitigates exposure to nonperformance risk associated with derivative instruments by limiting the number of counterparties and actively monitoring their financial strength and creditworthiness while requiring them to be well-known institutions with credit ratings equal to or better than AA- or equivalent. Further, the Company’s derivative contracts typically have short-term durations with maturities from one to four months. Accordingly, the Company’s risk of nonperformance relative to its derivative positions is not significant.
|
•
|
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.
|
•
|
Inventory held and used
- In determining the fair values of its inventory held and used in its impairment evaluations, the Company performs an analysis of the undiscounted cash flows estimated to be generated by those assets. The most significant factors used to estimate undiscounted future cash flows include pricing and incentive levels actually realized by the community, the rate at which the homes are sold and the costs incurred to develop the lots and construct the homes. Inventory held and used measured at fair value represents those communities for which the estimated undiscounted cash flows are less than their carrying amounts and therefore, the Company has recorded impairments during the current period to record the inventory at fair value calculated based on its discounted estimated future cash flows.
|
•
|
Inventory available for sale
- The factors considered in determining fair values of the Company’s land held for sale primarily include actual sale contracts and recent offers received from outside third parties, and may also include prices for land in recent comparable sales transactions and other market analysis. If the estimated fair value less the costs to sell an asset is less than the asset’s current carrying value, the asset is written down to its estimated fair value less costs to sell.
|
•
|
Certain mortgage loans held for sale
- A limited number of mortgage loans held for sale have some degree of impairment affecting their marketability. For some of these loans, quoted prices in the secondary market are not available and therefore, a cash flow valuation model is used to determine fair value.
|
•
|
Certain other mortgage loans, rental properties and real estate owned
- Other mortgage loans include performing and nonperforming mortgage loans, which often become real estate owned through the foreclosure process. The fair values of other mortgage loans, rental properties and real estate owned are determined based on the Company’s assessment of the value of the underlying collateral or the value of the property, as applicable. The Company uses different methods to assess the value of the properties, which may include broker price opinions, appraisals or cash flow valuation models.
|
|
|
|
Fair Value at September 30, 2017
|
||||||||||||||
|
Balance Sheet Location
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
|
(In millions)
|
||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
||||||||
Debt securities collateralized by residential real estate
|
Other assets
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8.8
|
|
|
$
|
8.8
|
|
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Mortgage loans held for sale (a)
|
Mortgage loans held for sale
|
|
—
|
|
|
580.2
|
|
|
5.6
|
|
|
585.8
|
|
||||
Derivatives not designated as hedging instruments (b):
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate lock commitments
|
Other assets
|
|
—
|
|
|
9.4
|
|
|
—
|
|
|
9.4
|
|
||||
Forward sales of MBS
|
Other assets
|
|
—
|
|
|
1.1
|
|
|
—
|
|
|
1.1
|
|
||||
Best-efforts and mandatory commitments
|
Other assets
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
0.6
|
|
|
|
|
Fair Value at September 30, 2016
|
||||||||||||||
|
Balance Sheet Location
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
|
(In millions)
|
||||||||||||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Mortgage loans held for sale (a)
|
Mortgage loans held for sale
|
|
$
|
—
|
|
|
$
|
640.9
|
|
|
$
|
6.8
|
|
|
$
|
647.7
|
|
Derivatives not designated as hedging instruments (b):
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate lock commitments
|
Other assets
|
|
—
|
|
|
9.3
|
|
|
—
|
|
|
9.3
|
|
||||
Forward sales of MBS
|
Other liabilities
|
|
—
|
|
|
(2.6
|
)
|
|
—
|
|
|
(2.6
|
)
|
||||
Best-efforts and mandatory commitments
|
Other liabilities
|
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
Level 3 Assets at Fair Value for the Year Ended September 30, 2017
|
||||||||||||||||||||||||||
|
Balance at
September 30, 2016 |
|
Net realized and unrealized gains (losses)
|
|
Purchases
|
|
Sales and Settlements
|
|
Principal Reductions
|
|
Net transfers to (out of) Level 3
|
|
Balance at
September 30, 2017 |
||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||
Debt securities collateralized by residential real estate
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8.8
|
|
Mortgage loans held for sale (a)
|
6.8
|
|
|
1.3
|
|
|
—
|
|
|
(13.4
|
)
|
|
—
|
|
|
10.9
|
|
|
5.6
|
|
|||||||
|
|||||||||||||||||||||||||||
|
Level 3 Assets at Fair Value for the Year Ended September 30, 2016
|
||||||||||||||||||||||||||
|
Balance at
September 30, 2015 |
|
Net realized and unrealized gains (losses)
|
|
Purchases
|
|
Sales and Settlements
|
|
Principal Reductions
|
|
Net transfers to (out of) Level 3
|
|
Balance at
September 30, 2016 |
||||||||||||||
|
(In millions)
|
||||||||||||||||||||||||||
Debt securities collateralized by residential real estate
|
$
|
33.9
|
|
|
$
|
2.2
|
|
|
$
|
—
|
|
|
$
|
(35.8
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Mortgage loans held for sale (a)
|
13.9
|
|
|
2.4
|
|
|
—
|
|
|
(27.1
|
)
|
|
—
|
|
|
17.6
|
|
|
6.8
|
|
(a)
|
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
September 30, 2017
and
2016
include
$5.6 million
and
$6.8 million
, respectively, of loans for which the Company elected the fair value option upon origination and which the Company did not sell into the secondary market. Mortgage loans held for sale totaling
$10.9 million
and
$17.6 million
were transferred to Level 3 during fiscal
2017
and
2016
, respectively, due to significant unobservable inputs used in determining the fair value of these loans. The fair value of these mortgage loans held for sale is generally calculated considering pricing in the secondary market and adjusted for the value of the underlying collateral, including interest rate risk, liquidity risk and prepayment risk. The Company plans to sell these loans as market conditions permit.
|
(b)
|
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 as other assets or other liabilities. Changes in the fair value of these derivatives are included in financial services revenues in the consolidated statements of operations.
|
|
|
|
Fair Value at September 30, 2017
|
|
Fair Value at September 30, 2016
|
||||||||||||
|
Balance Sheet Location
|
|
Level 2
|
|
Level 3
|
|
Level 2
|
|
Level 3
|
||||||||
|
|
|
(In millions)
|
||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
||||||||
Inventory held and used (a) (b)
|
Inventories
|
|
$
|
—
|
|
|
$
|
33.4
|
|
|
$
|
—
|
|
|
$
|
5.2
|
|
Inventory available for sale (a) (c)
|
Inventories
|
|
—
|
|
|
1.2
|
|
|
—
|
|
|
0.8
|
|
||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Mortgage loans held for sale (a) (d)
|
Mortgage loans held for sale
|
|
—
|
|
|
0.6
|
|
|
1.6
|
|
|
2.4
|
|
||||
Other mortgage loans (a) (e)
|
Other assets
|
|
—
|
|
|
1.4
|
|
|
—
|
|
|
3.8
|
|
||||
Real estate owned (a) (e)
|
Other assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
(a)
|
The fair values included in the table above represent only those assets whose carrying values were adjusted to fair value as a result of impairment in the respective period and were held at the end of the period.
|
(b)
|
In performing its impairment analysis of communities, discount rates ranging from
10%
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)
|
These mortgage loans have some degree of impairment affecting their marketability. When available, quoted prices in the secondary market are used to determine fair value (Level 2); otherwise, a cash flow valuation model is used to determine fair value (Level 3).
|
(e)
|
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 September 30, 2017
|
||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
$
|
973.0
|
|
|
$
|
973.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
973.0
|
|
Restricted cash (a)
|
9.3
|
|
|
9.3
|
|
|
—
|
|
|
—
|
|
|
9.3
|
|
|||||
Senior notes (b)
|
2,440.5
|
|
|
—
|
|
|
2,584.1
|
|
|
—
|
|
|
2,584.1
|
|
|||||
Other secured notes (a)
|
11.1
|
|
|
—
|
|
|
—
|
|
|
11.1
|
|
|
11.1
|
|
|||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
34.8
|
|
|
34.8
|
|
|
—
|
|
|
—
|
|
|
34.8
|
|
|||||
Restricted cash (a) (c)
|
7.2
|
|
|
7.2
|
|
|
—
|
|
|
—
|
|
|
7.2
|
|
|||||
Mortgage repurchase facility (a)
|
420.0
|
|
|
—
|
|
|
—
|
|
|
420.0
|
|
|
420.0
|
|
|
Carrying Value
|
|
Fair Value at September 30, 2016
|
||||||||||||||||
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
$
|
1,271.8
|
|
|
$
|
1,271.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,271.8
|
|
Restricted cash (a)
|
9.5
|
|
|
9.5
|
|
|
—
|
|
|
—
|
|
|
9.5
|
|
|||||
Senior notes (b)
|
2,786.7
|
|
|
—
|
|
|
2,947.4
|
|
|
—
|
|
|
2,947.4
|
|
|||||
Other secured notes (a)
|
11.6
|
|
|
—
|
|
|
—
|
|
|
11.6
|
|
|
11.6
|
|
|||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents (a)
|
31.4
|
|
|
31.4
|
|
|
—
|
|
|
—
|
|
|
31.4
|
|
|||||
Mortgage repurchase facility (a)
|
473.0
|
|
|
—
|
|
|
—
|
|
|
473.0
|
|
|
473.0
|
|
(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 prices, which is classified as Level 2 within the fair value hierarchy.
|
(c)
|
Restricted cash of the financial services segment represents escrow funds for taxes and insurance and is included in other assets in the Financial Services and Other section of the consolidated balance sheet.
|
|
Fiscal 2017
|
||||||||||||||
|
1st Quarter
|
|
2nd Quarter
|
|
3rd Quarter
|
|
4th Quarter
|
||||||||
Revenues
|
$
|
2,904.2
|
|
|
$
|
3,251.3
|
|
|
$
|
3,776.4
|
|
|
$
|
4,159.1
|
|
Gross profit
|
558.2
|
|
|
614.5
|
|
|
723.4
|
|
|
802.5
|
|
||||
Income before income taxes
|
318.1
|
|
|
353.9
|
|
|
444.5
|
|
|
485.5
|
|
||||
Income tax expense
|
111.2
|
|
|
124.7
|
|
|
155.5
|
|
|
172.3
|
|
||||
Net income
|
206.9
|
|
|
229.2
|
|
|
289.0
|
|
|
313.2
|
|
||||
Basic net income per common share
|
0.55
|
|
|
0.61
|
|
|
0.77
|
|
|
0.84
|
|
||||
Net income per common share assuming dilution
|
0.55
|
|
|
0.60
|
|
|
0.76
|
|
|
0.82
|
|
|
Fiscal 2016
|
||||||||||||||
|
1st Quarter
|
|
2nd Quarter
|
|
3rd Quarter
|
|
4th Quarter
|
||||||||
Revenues
|
$
|
2,416.4
|
|
|
$
|
2,767.9
|
|
|
$
|
3,231.9
|
|
|
$
|
3,741.3
|
|
Gross profit
|
468.9
|
|
|
531.7
|
|
|
625.8
|
|
|
732.6
|
|
||||
Income before income taxes (a)
|
241.3
|
|
|
300.5
|
|
|
378.6
|
|
|
433.0
|
|
||||
Income tax expense
|
83.6
|
|
|
105.4
|
|
|
128.8
|
|
|
149.4
|
|
||||
Net income
|
157.7
|
|
|
195.1
|
|
|
249.8
|
|
|
283.6
|
|
||||
Basic net income per common share
|
0.43
|
|
|
0.53
|
|
|
0.67
|
|
|
0.76
|
|
||||
Net income per common share assuming dilution
|
0.42
|
|
|
0.52
|
|
|
0.66
|
|
|
0.75
|
|
(a)
|
In the fourth quarter of fiscal
2016
, income before income taxes was reduced by a goodwill impairment charge of
$7.2 million
.
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
780.9
|
|
|
$
|
154.5
|
|
|
$
|
72.4
|
|
|
$
|
—
|
|
|
$
|
1,007.8
|
|
Restricted cash
|
7.8
|
|
|
1.5
|
|
|
—
|
|
|
—
|
|
|
9.3
|
|
|||||
Investments in subsidiaries
|
4,812.6
|
|
|
—
|
|
|
—
|
|
|
(4,812.6
|
)
|
|
—
|
|
|||||
Inventories
|
3,540.4
|
|
|
5,579.9
|
|
|
116.8
|
|
|
—
|
|
|
9,237.1
|
|
|||||
Deferred income taxes
|
138.5
|
|
|
223.6
|
|
|
2.9
|
|
|
—
|
|
|
365.0
|
|
|||||
Property and equipment, net
|
104.8
|
|
|
59.7
|
|
|
166.3
|
|
|
(5.8
|
)
|
|
325.0
|
|
|||||
Other assets
|
245.5
|
|
|
259.7
|
|
|
67.9
|
|
|
—
|
|
|
573.1
|
|
|||||
Mortgage loans held for sale
|
—
|
|
|
—
|
|
|
587.3
|
|
|
—
|
|
|
587.3
|
|
|||||
Goodwill
|
—
|
|
|
80.0
|
|
|
—
|
|
|
—
|
|
|
80.0
|
|
|||||
Intercompany receivables
|
1,047.7
|
|
|
—
|
|
|
—
|
|
|
(1,047.7
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
10,678.2
|
|
|
$
|
6,358.9
|
|
|
$
|
1,013.6
|
|
|
$
|
(5,866.1
|
)
|
|
$
|
12,184.6
|
|
LIABILITIES & EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and other liabilities
|
$
|
483.9
|
|
|
$
|
956.9
|
|
|
$
|
126.6
|
|
|
$
|
(2.0
|
)
|
|
$
|
1,565.4
|
|
Intercompany payables
|
—
|
|
|
732.2
|
|
|
315.5
|
|
|
(1,047.7
|
)
|
|
—
|
|
|||||
Notes payable
|
2,443.4
|
|
|
8.2
|
|
|
420.0
|
|
|
—
|
|
|
2,871.6
|
|
|||||
Total Liabilities
|
2,927.3
|
|
|
1,697.3
|
|
|
862.1
|
|
|
(1,049.7
|
)
|
|
4,437.0
|
|
|||||
Stockholders’ equity
|
7,750.9
|
|
|
4,661.6
|
|
|
151.0
|
|
|
(4,816.4
|
)
|
|
7,747.1
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
0.5
|
|
|
—
|
|
|
0.5
|
|
|||||
Total Equity
|
7,750.9
|
|
|
4,661.6
|
|
|
151.5
|
|
|
(4,816.4
|
)
|
|
7,747.6
|
|
|||||
Total Liabilities & Equity
|
$
|
10,678.2
|
|
|
$
|
6,358.9
|
|
|
$
|
1,013.6
|
|
|
$
|
(5,866.1
|
)
|
|
$
|
12,184.6
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
1,076.4
|
|
|
$
|
154.0
|
|
|
$
|
72.8
|
|
|
$
|
—
|
|
|
$
|
1,303.2
|
|
Restricted cash
|
7.4
|
|
|
2.1
|
|
|
—
|
|
|
—
|
|
|
9.5
|
|
|||||
Investments in subsidiaries
|
4,118.6
|
|
|
—
|
|
|
—
|
|
|
(4,118.6
|
)
|
|
—
|
|
|||||
Inventories
|
2,822.1
|
|
|
5,425.7
|
|
|
93.1
|
|
|
—
|
|
|
8,340.9
|
|
|||||
Deferred income taxes
|
159.3
|
|
|
314.1
|
|
|
2.9
|
|
|
—
|
|
|
476.3
|
|
|||||
Property and equipment, net
|
72.0
|
|
|
49.9
|
|
|
78.7
|
|
|
(5.2
|
)
|
|
195.4
|
|
|||||
Other assets
|
168.7
|
|
|
274.2
|
|
|
56.7
|
|
|
—
|
|
|
499.6
|
|
|||||
Mortgage loans held for sale
|
—
|
|
|
—
|
|
|
654.0
|
|
|
—
|
|
|
654.0
|
|
|||||
Goodwill
|
—
|
|
|
80.0
|
|
|
—
|
|
|
—
|
|
|
80.0
|
|
|||||
Intercompany receivables
|
1,604.5
|
|
|
—
|
|
|
—
|
|
|
(1,604.5
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
10,029.0
|
|
|
$
|
6,300.0
|
|
|
$
|
958.2
|
|
|
$
|
(5,728.3
|
)
|
|
$
|
11,558.9
|
|
LIABILITIES & EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Accounts payable and other liabilities
|
$
|
444.1
|
|
|
$
|
933.1
|
|
|
$
|
119.2
|
|
|
$
|
(1.8
|
)
|
|
$
|
1,494.6
|
|
Intercompany payables
|
—
|
|
|
1,417.1
|
|
|
187.4
|
|
|
(1,604.5
|
)
|
|
—
|
|
|||||
Notes payable
|
2,789.0
|
|
|
9.3
|
|
|
473.0
|
|
|
—
|
|
|
3,271.3
|
|
|||||
Total Liabilities
|
3,233.1
|
|
|
2,359.5
|
|
|
779.6
|
|
|
(1,606.3
|
)
|
|
4,765.9
|
|
|||||
Stockholders’ equity
|
6,795.9
|
|
|
3,940.5
|
|
|
178.1
|
|
|
(4,122.0
|
)
|
|
6,792.5
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
0.5
|
|
|
—
|
|
|
0.5
|
|
|||||
Total Equity
|
6,795.9
|
|
|
3,940.5
|
|
|
178.6
|
|
|
(4,122.0
|
)
|
|
6,793.0
|
|
|||||
Total Liabilities & Equity
|
$
|
10,029.0
|
|
|
$
|
6,300.0
|
|
|
$
|
958.2
|
|
|
$
|
(5,728.3
|
)
|
|
$
|
11,558.9
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
4,773.6
|
|
|
$
|
8,939.5
|
|
|
$
|
37.5
|
|
|
$
|
(9.1
|
)
|
|
$
|
13,741.5
|
|
Cost of sales
|
3,827.6
|
|
|
7,199.6
|
|
|
24.1
|
|
|
(8.5
|
)
|
|
11,042.8
|
|
|||||
Gross profit
|
946.0
|
|
|
1,739.9
|
|
|
13.4
|
|
|
(0.6
|
)
|
|
2,698.7
|
|
|||||
Selling, general and administrative expense
|
584.3
|
|
|
631.0
|
|
|
5.1
|
|
|
—
|
|
|
1,220.4
|
|
|||||
Equity in (income) of subsidiaries
|
(1,232.7
|
)
|
|
—
|
|
|
—
|
|
|
1,232.7
|
|
|
—
|
|
|||||
Other (income) expense
|
(8.3
|
)
|
|
(1.4
|
)
|
|
(1.3
|
)
|
|
—
|
|
|
(11.0
|
)
|
|||||
Homebuilding pre-tax income
|
1,602.7
|
|
|
1,110.3
|
|
|
9.6
|
|
|
(1,233.3
|
)
|
|
1,489.3
|
|
|||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
—
|
|
|
—
|
|
|
349.5
|
|
|
—
|
|
|
349.5
|
|
|||||
General and administrative expense
|
—
|
|
|
—
|
|
|
251.2
|
|
|
—
|
|
|
251.2
|
|
|||||
Interest and other (income) expense
|
—
|
|
|
—
|
|
|
(14.5
|
)
|
|
—
|
|
|
(14.5
|
)
|
|||||
Financial services and other pre-tax income
|
—
|
|
|
—
|
|
|
112.8
|
|
|
—
|
|
|
112.8
|
|
|||||
Income before income taxes
|
1,602.7
|
|
|
1,110.3
|
|
|
122.4
|
|
|
(1,233.3
|
)
|
|
1,602.1
|
|
|||||
Income tax expense
|
563.9
|
|
|
388.6
|
|
|
45.9
|
|
|
(434.7
|
)
|
|
563.7
|
|
|||||
Net income
|
$
|
1,038.8
|
|
|
$
|
721.7
|
|
|
$
|
76.5
|
|
|
$
|
(798.6
|
)
|
|
$
|
1,038.4
|
|
Comprehensive income
|
$
|
1,038.8
|
|
|
$
|
721.7
|
|
|
$
|
76.5
|
|
|
$
|
(798.6
|
)
|
|
$
|
1,038.4
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
3,947.5
|
|
|
$
|
7,930.3
|
|
|
$
|
—
|
|
|
$
|
(16.0
|
)
|
|
$
|
11,861.8
|
|
Cost of sales
|
3,163.6
|
|
|
6,357.5
|
|
|
(7.7
|
)
|
|
(10.8
|
)
|
|
9,502.6
|
|
|||||
Gross profit
|
783.9
|
|
|
1,572.8
|
|
|
7.7
|
|
|
(5.2
|
)
|
|
2,359.2
|
|
|||||
Selling, general and administrative expense
|
503.8
|
|
|
592.7
|
|
|
3.8
|
|
|
—
|
|
|
1,100.3
|
|
|||||
Goodwill impairment
|
—
|
|
|
7.2
|
|
|
—
|
|
|
—
|
|
|
7.2
|
|
|||||
Equity in (income) of subsidiaries
|
(1,071.0
|
)
|
|
—
|
|
|
—
|
|
|
1,071.0
|
|
|
—
|
|
|||||
Other (income) expense
|
(7.6
|
)
|
|
(3.9
|
)
|
|
(1.2
|
)
|
|
—
|
|
|
(12.7
|
)
|
|||||
Homebuilding pre-tax income
|
1,358.7
|
|
|
976.8
|
|
|
5.1
|
|
|
(1,076.2
|
)
|
|
1,264.4
|
|
|||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
—
|
|
|
—
|
|
|
295.6
|
|
|
—
|
|
|
295.6
|
|
|||||
General and administrative expense
|
—
|
|
|
—
|
|
|
220.0
|
|
|
—
|
|
|
220.0
|
|
|||||
Interest and other (income) expense
|
—
|
|
|
—
|
|
|
(13.5
|
)
|
|
—
|
|
|
(13.5
|
)
|
|||||
Financial services and other pre-tax income
|
—
|
|
|
—
|
|
|
89.1
|
|
|
—
|
|
|
89.1
|
|
|||||
Income before income taxes
|
1,358.7
|
|
|
976.8
|
|
|
94.2
|
|
|
(1,076.2
|
)
|
|
1,353.5
|
|
|||||
Income tax expense
|
469.0
|
|
|
334.9
|
|
|
35.5
|
|
|
(372.2
|
)
|
|
467.2
|
|
|||||
Net income
|
$
|
889.7
|
|
|
$
|
641.9
|
|
|
$
|
58.7
|
|
|
$
|
(704.0
|
)
|
|
$
|
886.3
|
|
Comprehensive income
|
$
|
888.3
|
|
|
$
|
641.9
|
|
|
$
|
58.7
|
|
|
$
|
(704.0
|
)
|
|
$
|
884.9
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Homebuilding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
$
|
3,334.6
|
|
|
$
|
7,224.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
10,559.0
|
|
Cost of sales
|
2,698.1
|
|
|
5,834.3
|
|
|
3.3
|
|
|
—
|
|
|
8,535.7
|
|
|||||
Gross profit (loss)
|
636.5
|
|
|
1,390.1
|
|
|
(3.3
|
)
|
|
—
|
|
|
2,023.3
|
|
|||||
Selling, general and administrative expense
|
461.2
|
|
|
538.8
|
|
|
3.0
|
|
|
—
|
|
|
1,003.0
|
|
|||||
Goodwill impairment
|
—
|
|
|
9.8
|
|
|
—
|
|
|
—
|
|
|
9.8
|
|
|||||
Equity in (income) of subsidiaries
|
(945.9
|
)
|
|
—
|
|
|
—
|
|
|
945.9
|
|
|
—
|
|
|||||
Other (income) expense
|
(2.2
|
)
|
|
(4.9
|
)
|
|
(0.7
|
)
|
|
—
|
|
|
(7.8
|
)
|
|||||
Homebuilding pre-tax income (loss)
|
1,123.4
|
|
|
846.4
|
|
|
(5.6
|
)
|
|
(945.9
|
)
|
|
1,018.3
|
|
|||||
Financial Services and Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Revenues
|
—
|
|
|
—
|
|
|
265.0
|
|
|
—
|
|
|
265.0
|
|
|||||
General and administrative expense
|
—
|
|
|
—
|
|
|
183.0
|
|
|
—
|
|
|
183.0
|
|
|||||
Interest and other (income) expense
|
—
|
|
|
—
|
|
|
(23.1
|
)
|
|
—
|
|
|
(23.1
|
)
|
|||||
Financial services and other pre-tax income
|
—
|
|
|
—
|
|
|
105.1
|
|
|
—
|
|
|
105.1
|
|
|||||
Income before income taxes
|
1,123.4
|
|
|
846.4
|
|
|
99.5
|
|
|
(945.9
|
)
|
|
1,123.4
|
|
|||||
Income tax expense
|
372.7
|
|
|
277.2
|
|
|
37.4
|
|
|
(314.6
|
)
|
|
372.7
|
|
|||||
Net income
|
$
|
750.7
|
|
|
$
|
569.2
|
|
|
$
|
62.1
|
|
|
$
|
(631.3
|
)
|
|
$
|
750.7
|
|
Comprehensive income
|
$
|
750.7
|
|
|
$
|
568.4
|
|
|
$
|
62.1
|
|
|
$
|
(631.3
|
)
|
|
$
|
749.9
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net cash (used in) provided by operating activities
|
$
|
(288.3
|
)
|
|
$
|
721.0
|
|
|
$
|
115.0
|
|
|
$
|
(112.6
|
)
|
|
$
|
435.1
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Expenditures for property and equipment
|
(54.2
|
)
|
|
(26.2
|
)
|
|
(86.0
|
)
|
|
9.1
|
|
|
(157.3
|
)
|
|||||
(Increase) decrease in restricted cash
|
(0.4
|
)
|
|
0.6
|
|
|
(7.2
|
)
|
|
—
|
|
|
(7.0
|
)
|
|||||
Net principal decrease of other mortgage loans and real estate owned
|
—
|
|
|
—
|
|
|
6.2
|
|
|
—
|
|
|
6.2
|
|
|||||
Purchases of debt securities collateralized by residential real estate
|
(8.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8.8
|
)
|
|||||
Intercompany advances
|
561.7
|
|
|
—
|
|
|
—
|
|
|
(561.7
|
)
|
|
—
|
|
|||||
Payments related to acquisition of a business
|
(4.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4.1
|
)
|
|||||
Net cash provided by (used in) investing activities
|
494.2
|
|
|
(25.6
|
)
|
|
(87.0
|
)
|
|
(552.6
|
)
|
|
(171.0
|
)
|
|||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Proceeds from notes payable
|
835.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
835.0
|
|
|||||
Repayment of notes payable
|
(1,187.2
|
)
|
|
(5.1
|
)
|
|
(53.0
|
)
|
|
—
|
|
|
(1,245.3
|
)
|
|||||
Intercompany advances
|
—
|
|
|
(689.8
|
)
|
|
128.1
|
|
|
561.7
|
|
|
—
|
|
|||||
Proceeds from stock associated with certain employee benefit plans
|
46.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
46.7
|
|
|||||
Excess income tax benefit from employee stock awards
|
14.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14.3
|
|
|||||
Cash dividends paid
|
(149.6
|
)
|
|
—
|
|
|
(103.5
|
)
|
|
103.5
|
|
|
(149.6
|
)
|
|||||
Repurchases of common stock
|
(60.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(60.6
|
)
|
|||||
Net cash used in financing activities
|
(501.4
|
)
|
|
(694.9
|
)
|
|
(28.4
|
)
|
|
665.2
|
|
|
(559.5
|
)
|
|||||
(Decrease) increase in cash and cash equivalents
|
(295.5
|
)
|
|
0.5
|
|
|
(0.4
|
)
|
|
—
|
|
|
(295.4
|
)
|
|||||
Cash and cash equivalents at beginning of year
|
1,076.4
|
|
|
154.0
|
|
|
72.8
|
|
|
—
|
|
|
1,303.2
|
|
|||||
Cash and cash equivalents at end of year
|
$
|
780.9
|
|
|
$
|
154.5
|
|
|
$
|
72.4
|
|
|
$
|
—
|
|
|
$
|
1,007.8
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net cash provided by (used in) operating activities
|
$
|
115.1
|
|
|
$
|
596.7
|
|
|
$
|
(16.0
|
)
|
|
$
|
(77.8
|
)
|
|
$
|
618.0
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Expenditures for property and equipment
|
(40.7
|
)
|
|
(14.3
|
)
|
|
(47.1
|
)
|
|
16.0
|
|
|
(86.1
|
)
|
|||||
Decrease in restricted cash
|
—
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|||||
Net principal decrease of other mortgage loans and real estate owned
|
—
|
|
|
—
|
|
|
19.7
|
|
|
—
|
|
|
19.7
|
|
|||||
Proceeds from the sale of debt securities collateralized by residential real estate
|
35.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35.8
|
|
|||||
Intercompany advances
|
409.9
|
|
|
—
|
|
|
—
|
|
|
(409.9
|
)
|
|
—
|
|
|||||
Payments related to acquisition of a business
|
(82.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(82.2
|
)
|
|||||
Net cash provided by (used in) investing activities
|
322.8
|
|
|
(14.1
|
)
|
|
(27.4
|
)
|
|
(393.9
|
)
|
|
(112.6
|
)
|
|||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Repayment of notes payable
|
(542.9
|
)
|
|
(1.9
|
)
|
|
(4.9
|
)
|
|
—
|
|
|
(549.7
|
)
|
|||||
Intercompany advances
|
—
|
|
|
(521.3
|
)
|
|
111.4
|
|
|
409.9
|
|
|
—
|
|
|||||
Proceeds from stock associated with certain employee benefit plans
|
72.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72.4
|
|
|||||
Excess income tax benefit from employee stock awards
|
10.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10.0
|
|
|||||
Cash dividends paid
|
(118.7
|
)
|
|
—
|
|
|
(61.8
|
)
|
|
61.8
|
|
|
(118.7
|
)
|
|||||
Net cash (used in) provided by financing activities
|
(579.2
|
)
|
|
(523.2
|
)
|
|
44.7
|
|
|
471.7
|
|
|
(586.0
|
)
|
|||||
(Decrease) increase in cash and cash equivalents
|
(141.3
|
)
|
|
59.4
|
|
|
1.3
|
|
|
—
|
|
|
(80.6
|
)
|
|||||
Cash and cash equivalents at beginning of year
|
1,217.7
|
|
|
94.6
|
|
|
71.5
|
|
|
—
|
|
|
1,383.8
|
|
|||||
Cash and cash equivalents at end of year
|
$
|
1,076.4
|
|
|
$
|
154.0
|
|
|
$
|
72.8
|
|
|
$
|
—
|
|
|
$
|
1,303.2
|
|
|
D.R.
Horton, Inc.
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net cash provided by (used in) operating activities
|
$
|
308.2
|
|
|
$
|
530.1
|
|
|
$
|
(106.3
|
)
|
|
$
|
(31.6
|
)
|
|
$
|
700.4
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Expenditures for property and equipment
|
(24.5
|
)
|
|
(24.8
|
)
|
|
(6.8
|
)
|
|
—
|
|
|
(56.1
|
)
|
|||||
Proceeds from the sale of property and equipment to a related party
|
56.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56.0
|
|
|||||
Increase in restricted cash
|
(0.4
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|||||
Net principal increase of other mortgage loans and real estate owned
|
—
|
|
|
—
|
|
|
(8.9
|
)
|
|
—
|
|
|
(8.9
|
)
|
|||||
Purchases of debt securities collateralized by residential real estate
|
(14.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14.8
|
)
|
|||||
Intercompany advances
|
444.7
|
|
|
—
|
|
|
—
|
|
|
(444.7
|
)
|
|
—
|
|
|||||
Payments related to acquisition of a business
|
(70.9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(70.9
|
)
|
|||||
Net cash provided by (used in) investing activities
|
390.1
|
|
|
(25.1
|
)
|
|
(15.7
|
)
|
|
(444.7
|
)
|
|
(95.4
|
)
|
|||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Proceeds from notes payable
|
1,472.0
|
|
|
—
|
|
|
118.7
|
|
|
—
|
|
|
1,590.7
|
|
|||||
Repayment of notes payable
|
(1,432.5
|
)
|
|
(6.3
|
)
|
|
(17.4
|
)
|
|
—
|
|
|
(1,456.2
|
)
|
|||||
Intercompany advances
|
—
|
|
|
(493.6
|
)
|
|
48.9
|
|
|
444.7
|
|
|
—
|
|
|||||
Proceeds from stock associated with certain employee benefit plans
|
61.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
61.8
|
|
|||||
Excess income tax benefit from employee stock awards
|
12.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12.3
|
|
|||||
Cash dividends paid
|
(91.6
|
)
|
|
—
|
|
|
(31.6
|
)
|
|
31.6
|
|
|
(91.6
|
)
|
|||||
Net cash provided by (used in) financing activities
|
22.0
|
|
|
(499.9
|
)
|
|
118.6
|
|
|
476.3
|
|
|
117.0
|
|
|||||
Increase (decrease) in cash and cash equivalents
|
720.3
|
|
|
5.1
|
|
|
(3.4
|
)
|
|
—
|
|
|
722.0
|
|
|||||
Cash and cash equivalents at beginning of year
|
497.4
|
|
|
89.5
|
|
|
74.9
|
|
|
—
|
|
|
661.8
|
|
|||||
Cash and cash equivalents at end of year
|
$
|
1,217.7
|
|
|
$
|
94.6
|
|
|
$
|
71.5
|
|
|
$
|
—
|
|
|
$
|
1,383.8
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
|
(a)
Number of Shares to
be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
|
|
|
(b)
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
|
|
|
(c)
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation Plans
(Excluding Securities
Reflected in Column (a))
|
|
||||
Plan Category
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans approved by stockholders
|
13,747,130
|
|
(1)
|
|
$
|
16.92
|
|
(2)
|
|
22,223,307
|
|
(3)
|
Equity compensation plans not approved by stockholders
|
—
|
|
|
|
n/a
|
|
|
|
—
|
|
|
|
Total
|
13,747,130
|
|
|
|
$
|
16.92
|
|
|
|
22,223,307
|
|
|
(1)
|
Amount includes outstanding stock option and restricted stock unit awards. The number of outstanding performance-based restricted stock unit awards is based on the target number of units granted.
|
(2)
|
Amount reflects the weighted average exercise price with respect to outstanding stock options and does not take into account outstanding restricted stock units, which do not have an exercise price.
|
(3)
|
Amount includes
3,215,080
shares reserved for issuance under the Company’s Employee Stock Purchase Plan. Under the Employee Stock Purchase Plan, employees purchased
111,527
shares of common stock in fiscal
2017
.
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTANT FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
Exhibit
Number
|
|
Exhibit
|
|
|
|
|
|
2.1
|
|
|
|
3.1
|
|
|
|
3.2
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
4.4
|
|
|
|
4.5
|
|
|
|
4.6
|
|
|
|
4.7
|
|
|
|
4.8
|
|
|
Exhibit Number
|
|
Exhibit
|
|
|
|
|
|
4.9
|
|
|
|
10.1
|
|
|
|
10.2
|
†
|
|
|
10.3
|
†
|
|
|
10.4
|
†
|
|
Form of Non-Qualified Stock Option Agreement under the D.R. Horton, Inc. 1991 Stock Incentive Plan (Term Vesting) (8)
|
10.5
|
†
|
|
|
10.6
|
†
|
|
|
10.7
|
†
|
|
|
10.8
|
†
|
|
|
10.9
|
†
|
|
|
10.10
|
†
|
|
|
10.11
|
†
|
|
|
10.12
|
†
|
|
|
10.13
|
†
|
|
|
10.14
|
†
|
|
|
10.15
|
†
|
|
|
10.16
|
†
|
|
|
10.17
|
†
|
|
|
10.18
|
†
|
|
D.R. Horton, Inc. Supplemental Executive Retirement Plan No. 1 (9)
|
10.19
|
†
|
|
|
10.20
|
†
|
|
|
10.21
|
†
|
|
|
10.22
|
†
|
|
|
10.23
|
†
|
|
Exhibit Number
|
|
Exhibit
|
|
|
|
|
|
10.24
|
†
|
|
|
10.25
|
†
|
|
|
10.26
|
†
|
|
|
10.27
|
†
|
|
|
10.28
|
†
|
|
|
10.29
|
†
|
|
|
10.30
|
†
|
|
|
10.31
|
|
|
|
10.32
|
|
|
|
10.33
|
|
|
|
10.34
|
|
|
|
10.35
|
|
|
|
10.36
|
|
|
|
10.37
|
|
|
|
10.38
|
|
|
|
10.39
|
|
|
|
10.40
|
|
|
|
10.41
|
|
|
|
10.42
|
|
|
|
10.43
|
|
|
Exhibit Number
|
|
Exhibit
|
|
|
|
|
|
10.44
|
|
|
|
10.45
|
|
|
|
10.46
|
|
|
|
12.1
|
|
|
|
14.1
|
|
|
Code of Ethical Conduct for the CEO, CFO and Senior Financial Officers (**)
|
21.1
|
|
|
|
23.1
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
32.2
|
|
|
|
101
|
|
|
The following financial statements from D.R. Horton, Inc.'s Annual Report on Form 10-K for the year ended September 30, 2017, filed on November 15, 2017, formatted in XBRL (Extensible Business Reporting Language); (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations and Comprehensive Income, (iii) Consolidated Statements of Total Equity, (iv) Consolidated Statements of Cash Flows and (v) the Notes to Consolidated Financial Statements. (*)
|
(1
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated November 9, 2011, filed with the SEC on November 16, 2011.
|
(2
|
)
|
|
Incorporated herein by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated February 5, 2013, filed with the SEC on February 8, 2013.
|
(3
|
)
|
|
Incorporated herein by reference from Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2005, filed with the SEC on February 2, 2006.
|
(4
|
)
|
|
Incorporated herein by reference from Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, dated November 2, 2017, filed with the SEC on November 8, 2017.
|
(5
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended September 30, 1995, filed with the SEC on November 22, 1995 (file number 1-14122); Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1998, filed with the SEC on August 6, 1998; and Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2001, filed with the SEC on May 15, 2001.
|
(6
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed with the SEC on August 13, 2002.
|
(7
|
)
|
|
Incorporated herein by reference from Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, filed with the SEC on August 13, 2002.
|
(8
|
)
|
|
Incorporated herein by reference from Exhibit 10.3 to the Registrant’s Registration Statement on Form S-1 (Registration No. 3-81856), filed with the SEC on July 22, 1994.
|
(9
|
)
|
|
Incorporated herein by reference from the Registrant’s Transitional Report on Form 10-K for the period from January 1, 1993 to September 30, 1993, filed with the SEC on December 28, 1993 (file number 1-14122).
|
(10
|
)
|
|
Incorporated by reference from Exhibit 2.1 to the Registrant’s Current Report on Form 8-K dated June 29, 2017, filed with the SEC on June 29, 2017.
|
(11
|
)
|
|
Incorporated herein by reference from Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2007, filed with the SEC on February 7, 2008.
|
(12
|
)
|
|
Incorporated herein by reference from Exhibit 10.34 to the Registrant’s Annual Report on Form 10-K for the fiscal year ended September 30, 2002, filed with the SEC on December 13, 2002.
|
(13
|
)
|
|
Incorporated herein by reference from Exhibit 4.2 to the Registrant’s Current Report on Form 8-K dated February 5, 2013, filed with the SEC on February 8, 2013.
|
(14
|
)
|
|
Incorporated herein by reference from Exhibit 4.3 to the Registrant’s Current Report on Form 8-K dated February 5, 2013, filed with the SEC on February 8, 2013.
|
(15
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 (2008 Form) to the Registrant’s Current Report on Form 8-K dated February 11, 2008, filed with the SEC on February 15, 2008; and Exhibit 10.4 (2009 Form) to the Registrant’s Current Report on Form 8-K dated November 20, 2008, filed with the SEC on November 26, 2008.
|
(16
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated November 2, 2016, filed with the SEC on November 8, 2016.
|
(17
|
)
|
|
Incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated November 2, 2016, filed with the SEC on November 8, 2016.
|
(18
|
)
|
|
Incorporated by reference from Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated November 2, 2016, filed with the SEC on November 8, 2016.
|
(19
|
)
|
|
Incorporated herein by reference from Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2005, filed with the SEC on February 2, 2006.
|
(20
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006, filed with the SEC on May 8, 2006.
|
(21
|
)
|
|
Incorporated herein by reference from Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006, filed with the SEC on May 8, 2006.
|
(22
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated February 11, 2008, filed with the SEC on February 15, 2008.
|
(23
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated November 1, 2012, filed with the SEC on November 5, 2012.
|
(24
|
)
|
|
Incorporated herein by reference from Exhibit 10.3 to the Registrant’s Current Report on Form 8-K dated February 11, 2008, filed with the SEC on February 15, 2008.
|
(25
|
)
|
|
Incorporated herein by reference from Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2007, filed with the SEC on February 7, 2008.
|
(26
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K/A dated March 1, 2013, filed with the SEC on March 8, 2013.
|
(27
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated February 27, 2015, filed with the SEC on March 4, 2015.
|
(28
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated August 8, 2013, filed with the SEC on August 13, 2013.
|
(29
|
)
|
|
Incorporated herein by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated August 5, 2013, filed with the SEC on August 8, 2013.
|
(30
|
)
|
|
Incorporated herein by reference from Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2012, filed with the SEC on January 29, 2013.
|
(31
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated December 10, 2008, filed with the SEC on December 16, 2008.
|
(32
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated December 10, 2008, filed with the SEC on December 16, 2008.
|
(33
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated January 20, 2011, filed with the SEC on January 26, 2011.
|
(34
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated September 30, 2010, filed with the SEC on October 6, 2010.
|
(35
|
)
|
|
Incorporated herein by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated September 30, 2010, filed with the SEC on October 6, 2010.
|
(36
|
)
|
|
Incorporated herein by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated May 1, 2012, filed with the SEC on May 4, 2012.
|
(37
|
)
|
|
Incorporated herein by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated September 7, 2012, filed with the SEC on September 10, 2012.
|
(38
|
)
|
|
Incorporated herein by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated September 14, 2012, filed with the SEC on September 17, 2012.
|
(39
|
)
|
|
Incorporated by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated February 24, 2014, filed with the SEC on February 25, 2014.
|
(40
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated February 28, 2014, filed with the SEC on March 5, 2014.
|
(41
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated September 29, 2014, filed with the SEC on October 3, 2014.
|
(42
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated August 22, 2014, filed with the SEC on August 25, 2014.
|
(43
|
)
|
|
Incorporated by reference from Exhibit 10.4 to the Registrant’s Current Report on Form 8-K dated November 5, 2014, filed with the SEC on November 12, 2014.
|
(44
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated January 22, 2015, filed with the SEC on January 26, 2015.
|
(45
|
)
|
|
Incorporated by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K dated February 9, 2015, filed with the SEC on February 9, 2015.
|
(46
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated February 27, 2015, filed with the SEC on March 4, 2015.
|
(47
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated August 26, 2015, filed with the SEC on August 27, 2015.
|
(48
|
)
|
|
Incorporated by reference from Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2015, filed with the SEC on April 24, 2015.
|
(49
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated February 26, 2016, filed with the SEC on March 2, 2016.
|
(50
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated September 23, 2016, filed with the SEC on September 27, 2016.
|
(51
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated September 25, 2017, filed with the SEC on September 28, 2017.
|
(52
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated June 29, 2017, filed with the SEC on June 29, 2017.
|
(53
|
)
|
|
Incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K dated February 24, 2017, filed with the SEC on February 28, 2017.
|
(54
|
)
|
|
Incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K dated June 29, 2017, filed with the SEC on June 29, 2017.
|
ITEM 16.
|
10-K SUMMARY
|
|
|
|
D.R. Horton, Inc.
|
|
|
|
|
|
|
Date:
|
November 15, 2017
|
|
By:
|
/s/ Bill W. Wheat
|
|
|
|
|
Bill W. Wheat
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
Signature
|
|
Title
|
|
Date
|
||
|
|
|
|
|
||
/s/ David V. Auld
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
|
November 15, 2017
|
||
David V. Auld
|
|
|
|
|||
|
|
|
|
|
||
/s/ Bill W. Wheat
|
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)
|
|
November 15, 2017
|
||
Bill W. Wheat
|
|
|
|
|||
|
|
|
|
|
||
/s/ Donald R. Horton
|
|
Chairman of the Board and Director
|
|
November 15, 2017
|
||
Donald R. Horton
|
|
|
|
|||
|
|
|
|
|
||
/s/ Barbara K. Allen
|
|
Director
|
|
November 15, 2017
|
||
Barbara K. Allen
|
|
|
|
|||
|
|
|
|
|
||
/s/ Brad S. Anderson
|
|
Director
|
|
November 15, 2017
|
||
Brad S. Anderson
|
|
|
|
|||
|
|
|
|
|
||
/s/ Michael R. Buchanan
|
|
Director
|
|
November 15, 2017
|
||
Michael R. Buchanan
|
|
|
|
|||
|
|
|
|
|
||
/s/ Michael W. Hewatt
|
|
Director
|
|
November 15, 2017
|
||
Michael W. Hewatt
|
|
|
|
|
|
|
|
Annual Base Salary
|
|
Annual Incentive Bonus
|
Name
|
|
Office
|
|
Fiscal 2018
|
|
Fiscal 2018
|
Donald R. Horton
|
|
Chairman of the Board
|
|
$1,000,000
|
|
See Below
|
David V. Auld
|
|
President and CEO
|
|
$700,000
|
|
See Below
|
Michael J. Murray
|
|
Executive Vice President and COO
|
|
$500,000
|
|
See Below
|
(1)
|
Up to
0.6%
of Pre-Tax Income of the Company for the six-month period ending
March 31, 2018
, and
|
(2)
|
Up to
0.6%
of Pre-Tax Income of the Company for the six-month period ending
September 30, 2018
.
|
(1)
|
Up to
0.4%
of Pre-Tax Income of the Company for the six-month period ending
March 31, 2018
, and
|
(2)
|
Up to
0.4%
of Pre-Tax Income of the Company for the six-month period ending
September 30, 2018
.
|
(1)
|
Up to
0.15%
of Pre-Tax Income of the Company for the six-month period ending
March 31, 2018
, and
|
(2)
|
Up to
0.15%
of Pre-Tax Income of the Company for the six-month period ending
September 30, 2018
.
|
Name
|
|
Office
|
|
Target Number of Performance
Restricted Stock Units
|
Donald R. Horton
|
|
Chairman of the Board
|
|
200,000
|
David V. Auld
|
|
President and CEO
|
|
100,000
|
Michael J. Murray
|
|
Executive Vice President and COO
|
|
30,000
|
|
|
|
|
Annual Base Salary
|
|
Discretionary Bonus Plan
|
Name
|
|
Office
|
|
Fiscal 2018
|
|
Fiscal 2018
|
Bill W. Wheat
|
|
Executive Vice President and CFO
|
|
$500,000
|
|
See Note II
|
Name
|
|
Office
|
|
Number of Time Vesting
Restricted Stock Units
|
Bill W. Wheat
|
|
Executive Vice President and CFO
|
|
40,000
|
|
|
For the Fiscal Year Ended September 30,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
|
2013
|
||||||||||
|
|
($ in millions)
|
||||||||||||||||||
Consolidated income before income taxes
|
|
$
|
1,602.1
|
|
|
$
|
1,353.5
|
|
|
$
|
1,123.4
|
|
|
$
|
814.2
|
|
|
$
|
657.8
|
|
Amortization of capitalized interest
|
|
152.6
|
|
|
169.1
|
|
|
159.7
|
|
|
124.4
|
|
|
110.9
|
|
|||||
Interest expensed
|
|
6.6
|
|
|
6.2
|
|
|
5.6
|
|
|
4.8
|
|
|
11.7
|
|
|||||
Earnings
|
|
$
|
1,761.3
|
|
|
$
|
1,528.8
|
|
|
$
|
1,288.7
|
|
|
$
|
943.4
|
|
|
$
|
780.4
|
|
Interest incurred
|
|
$
|
135.9
|
|
|
$
|
158.5
|
|
|
$
|
174.8
|
|
|
$
|
190.6
|
|
|
$
|
177.3
|
|
Fixed charges
|
|
$
|
135.9
|
|
|
$
|
158.5
|
|
|
$
|
174.8
|
|
|
$
|
190.6
|
|
|
$
|
177.3
|
|
Ratio of earnings to fixed charges
|
|
12.96
|
|
|
9.65
|
|
|
7.37
|
|
|
4.95
|
|
|
4.40
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
|
|
|
|
|
Austin Data, Inc.
|
|
Texas
|
|
|
BP456, Inc.
|
|
Delaware
|
|
|
C. Richard Dobson Builders, Inc.
|
|
Virginia
|
|
Dobson Builders
|
Cane Island, LLC
|
|
Delaware
|
|
|
CH Funding, LLC
|
|
Delaware
|
|
|
CH Investments of Texas, Inc.
|
|
Delaware
|
|
|
CHI Construction Company
|
|
Arizona
|
|
|
CHM Partners, L.P.
|
|
Texas
|
|
|
CHTEX of Texas, Inc.
|
|
Delaware
|
|
|
The Club at Cobblestone, LLC
|
|
Delaware
|
|
|
The Club at Hidden River, LLC
|
|
Delaware
|
|
|
Continental Homes, Inc.
|
|
Delaware
|
|
D.R. Horton - Continental Series; D.R. Horton - Astanté Series; Traditions - D.R. Horton; Traditions; Homestead by D.R. Horton - Continental Series
|
Continental Homes of Texas, L.P.
|
|
Texas
|
|
D.R. Horton Homes; D.R. Horton America’s Builder; Emerald Homes; Express Homes; Freedom Homes; Milburn Homes; Continental Homes; Sam Houston Homes
|
Continental Residential, Inc.
|
|
California
|
|
Continental Homes; D.R. Horton America’s Builder; Horton Continental; Emerald Homes; Freedom Homes
|
Continental Traditions, LLC
|
|
Arizona
|
|
|
Crown Operating Company, Inc.
|
|
Delaware
|
|
|
CV Mountain View 25 Inv, LLC
|
|
Delaware
|
|
|
Cypress Road, L.P.
|
|
California
|
|
|
Desert Ridge Phase I Partners
|
|
Arizona
|
|
|
DHI Communities, Inc.
|
|
Delaware
|
|
DHI Communities
|
DHI Communities II, LLC
|
|
Delaware
|
|
DHI Communities
|
DHI Communities Construction, LLC
|
|
Delaware
|
|
|
DHI Communities Construction of Arizona, LLC
|
|
Delaware
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
DHI Communities Construction of Florida, LLC
|
|
Delaware
|
|
|
DHI Communities Construction of Texas, LLC
|
|
Delaware
|
|
|
DHI Insurance, Inc.
|
|
Vermont
|
|
|
DHI Mortgage Company
|
|
Colorado
|
|
CH Mortgage Company
|
DHI Mortgage Company GP, Inc.
|
|
Delaware
|
|
|
DHI Mortgage Company LP, Inc.
|
|
Delaware
|
|
|
DHI Mortgage Company, Ltd.
|
|
Texas
|
|
CH Mortgage I, Ltd., CH Mortgage Company I, Ltd., CH Mortgage Company I, Ltd., L.P., CH Mortgage Company I, Ltd., Limited Partnership, DHI Mortgage Company Ltd., Limited Partnership, DHI Mortgage, Limited Partnership, DHI Mortgage
|
DHI Ranch, Ltd.
|
|
Texas
|
|
|
DHI Title GP, Inc.
|
|
Texas
|
|
|
DHI Title LP, Inc.
|
|
Delaware
|
|
|
DHI Title of Alabama, Inc.
|
|
Alabama
|
|
DHI Title of Mississippi
|
DHI Title of Arizona, Inc.
|
|
Arizona
|
|
DHI Title Agency
|
DHI Title of Florida, Inc.
|
|
Florida
|
|
|
DHI Title of Minnesota, Inc.
|
|
Delaware
|
|
DHI Title of Hawaii; DHI Title of Louisiana
|
DHI Title of Nevada, Inc.
|
|
Delaware
|
|
|
DHI Title of Texas, Ltd.
|
|
Texas
|
|
|
DHI Verandah South Shores Communities, LLC
|
|
Delaware
|
|
D.R. Horton
|
DHIC - Bridges, LLC
|
|
Delaware
|
|
DHI Communities
|
DHIC - Desert Peak, LLC
|
|
Delaware
|
|
DHI Communities
|
DHIC - Jacob’s Reserve, LLC
|
|
Delaware
|
|
DHI Communities
|
DHIC - Minton Cove, LLC
|
|
Delaware
|
|
DHI Communities
|
DHIC - Prairie Village, LLC
|
|
Delaware
|
|
DHI Communities
|
DHIC - Waterleigh, LLC
|
|
Delaware
|
|
DHI Communities
|
DHIC - Westridge, LLC
|
|
Delaware
|
|
DHI Communities
|
D.R. Horton - Crown, LLC
|
|
Delaware
|
|
Crown Communities
|
D.R. Horton - Emerald, Ltd.
|
|
Texas
|
|
D.R. Horton America’s Builder; Continental Homes; D.R. Horton Homes; Dietz-Crane Homes; Emerald Builders; Emerald Homes
|
D.R. Horton - Georgia, LLC
|
|
Delaware
|
|
|
D.R. Horton - MV, LLC
|
|
Delaware
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
D.R. Horton - Regent, LLC
|
|
Delaware
|
|
|
D.R. Horton - Schuler Homes, LLC
|
|
Delaware
|
|
Emerald Homes; Express Homes
|
D.R. Horton - Texas, Ltd.
|
|
Texas
|
|
D.R. Horton - Texas, Ltd. LP; D.R. Horton America’s Builder; D.R. Horton Homes; Emerald Homes; Express Homes; Continental Homes
|
D.R. Horton - WPH, LLC
|
|
Delaware
|
|
|
D.R. Horton, Inc. - Birmingham
|
|
Alabama
|
|
Emerald Homes; Express Homes
|
D.R. Horton, Inc. - Chicago
|
|
Delaware
|
|
|
D.R. Horton, Inc. - Denver
|
|
Delaware
|
|
Trimark Communities; D.R. Horton - Trimark Series
|
D.R. Horton, Inc. - Dietz-Crane
|
|
Delaware
|
|
|
D.R. Horton, Inc. - Greensboro
|
|
Delaware
|
|
|
D.R. Horton, Inc. - Gulf Coast
|
|
Delaware
|
|
|
D.R. Horton, Inc. - Huntsville
|
|
Delaware
|
|
Emerald Homes; Express Homes
|
D.R. Horton, Inc. - Jacksonville
|
|
Delaware
|
|
Continental Homes; Continental Homes - Jacksonville; Emerald Homes; Express Homes; Freedom Homes
|
D.R. Horton, Inc. - Louisville
|
|
Delaware
|
|
|
D.R. Horton, Inc. - Minnesota
|
|
Delaware
|
|
Emerald Homes; Express Homes; Freedom Homes
|
D.R. Horton, Inc. - New Jersey
|
|
Delaware
|
|
D.R. Horton, Northeast Division; D.R. Horton, Mid-Atlantic Division; Emerald Homes; Express Homes; Freedom Homes
|
D.R. Horton, Inc. - Portland
|
|
Delaware
|
|
D.R. Horton America’s Builder; Emerald Homes; Express Homes; Express Homes of Oregon; RMP Properties
|
D.R. Horton, Inc. - Torrey
|
|
Delaware
|
|
Torrey Homes
|
D.R. Horton, Inc. Foundation
|
|
Texas
|
|
|
D.R. Horton BAY, Inc.
|
|
Delaware
|
|
D.R. Horton America’s Builder; Emerald Homes; Express Homes
|
D.R. Horton CA2, Inc.
|
|
California
|
|
D.R. Horton America’s Builder; Emerald Homes; Express Homes
|
D.R. Horton CA3, Inc.
|
|
Delaware
|
|
D.R. Horton America’s Builder; Emerald Homes; Express Homes
|
D.R. Horton CA4, LLC
|
|
Delaware
|
|
|
D.R. Horton Commercial, Inc.
|
|
Delaware
|
|
|
D.R. Horton Cruces Construction, Inc.
|
|
Delaware
|
|
|
D.R. Horton Insurance Agency, Inc.
|
|
Texas
|
|
|
D.R. Horton LA North, Inc.
|
|
Delaware
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
D.R. Horton Life Insurance Agency, Inc.
|
|
Texas
|
|
|
D.R. Horton Los Angeles Holding Company, Inc.
|
|
California
|
|
D.R. Horton America’s Builder; Emerald Homes; Seabridge Marina; Freedom Homes
|
D.R. Horton Management Company, Ltd.
|
|
Texas
|
|
|
D.R. Horton Materials, Inc.
|
|
Delaware
|
|
|
D.R. Horton Realty, LLC
|
|
Delaware
|
|
|
D.R. Horton Realty of Central Florida, LLC
|
|
Delaware
|
|
|
D.R. Horton Realty of Georgia, Inc.
|
|
Delaware
|
|
|
D.R. Horton Realty of Melbourne, LLC
|
|
Delaware
|
|
|
D.R. Horton Realty of Northwest Florida, LLC
|
|
Delaware
|
|
|
D.R. Horton Realty of Southeast Florida, LLC
|
|
Delaware
|
|
|
D.R. Horton Realty of Southwest Florida, LLC
|
|
Delaware
|
|
|
D.R. Horton Realty of Tampa, LLC
|
|
Delaware
|
|
|
D.R. Horton Seabridge Marina, Inc.
|
|
Delaware
|
|
|
D.R. Horton Serenity Construction, LLC
|
|
Delaware
|
|
|
D.R. Horton Urban Renewal, LLC
|
|
New Jersey
|
|
|
D.R. Horton VEN, Inc.
|
|
California
|
|
D.R. Horton America’s Builder; Emerald Homes
|
DRH Cambridge Homes, Inc.
|
|
California
|
|
Cambridge Homes; Emerald Homes; Express Homes; Express Homes of Illinois; Freedom Homes, Freedom Homes of Illinois
|
DRH Cambridge Homes, LLC
|
|
Delaware
|
|
|
DRH Capital Trust I
|
|
Delaware
|
|
|
DRH Capital Trust II
|
|
Delaware
|
|
|
DRH Capital Trust III
|
|
Delaware
|
|
|
DRH Colorado Realty, Inc.
|
|
Delaware
|
|
|
DRH Construction, Inc.
|
|
Delaware
|
|
|
DRH Energy, Inc.
|
|
Colorado
|
|
|
DRH Land Opportunities I, Inc.
|
|
Delaware
|
|
|
DRH Land Opportunities II, Inc.
|
|
Delaware
|
|
|
DRH FS Mortgage Reinsurance, Ltd.
|
|
Turks & Caicos
|
|
|
DRH Mountain View, LLC
|
|
Delaware
|
|
|
DRH Oil & Gas, Inc.
|
|
Delaware
|
|
|
DRH Properties, Inc.
|
|
Arizona
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
DRH Realty Capital, LLC
|
|
Delaware
|
|
|
DRH Realty Company, Inc.
|
|
California
|
|
CH Realty
|
DRH Regrem VII, LP
|
|
Texas
|
|
|
DRH Regrem XII, LP
|
|
Texas
|
|
|
DRH Regrem XIV, Inc.
|
|
Delaware
|
|
|
DRH Regrem XV, Inc.
|
|
Delaware
|
|
|
DRH Regrem XVI, Inc.
|
|
Delaware
|
|
|
DRH Regrem XVII, Inc.
|
|
Delaware
|
|
|
DRH Regrem XVIII, Inc.
|
|
Delaware
|
|
|
DRH Regrem XIX, Inc.
|
|
Delaware
|
|
|
DRH Regrem XX, Inc.
|
|
Delaware
|
|
|
DRH Regrem XXI, Inc.
|
|
Delaware
|
|
|
DRH Regrem XXII, Inc.
|
|
Delaware
|
|
|
DRH Regrem XXIII, Inc.
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|
Delaware
|
|
|
DRH Regrem XXIV, Inc.
|
|
Delaware
|
|
|
DRH Regrem XXV, Inc.
|
|
Delaware
|
|
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DRH Regrem XXXII, LLC
|
|
Delaware
|
|
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DRH Regrem XXXIII, LLC
|
|
Delaware
|
|
|
DRH Regrem XXXIV, LLC
|
|
Delaware
|
|
|
DRH Regrem XXXV, LLC
|
|
Delaware
|
|
|
DRH Regrem XXXVI, LLC
|
|
Delaware
|
|
|
DRH Regrem XXXVII, LLC
|
|
Delaware
|
|
|
DRH Regrem XXXVIII, LLC
|
|
Delaware
|
|
|
DRH Regrem XXXIX, LLC
|
|
Delaware
|
|
|
DRH Regrem XL, LLC
|
|
Delaware
|
|
|
DRH Southwest Construction, Inc.
|
|
California
|
|
|
DRH Tucson Construction, Inc.
|
|
Delaware
|
|
|
DRHI, Inc.
|
|
Delaware
|
|
Express Homes
|
Emerald Creek No. 4, L.P.
|
|
Texas
|
|
|
Emerald Realty of Alabama, LLC
|
|
Delaware
|
|
|
Emerald Realty of Central Florida, LLC
|
|
Delaware
|
|
|
Emerald Realty of North Florida, LLC
|
|
Delaware
|
|
|
Emerald Realty of Northwest Florida, LLC
|
|
Delaware
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
Emerald Realty of Southeast Florida, LLC
|
|
Delaware
|
|
|
Emerald Realty of Southwest Florida, LLC
|
|
Delaware
|
|
|
Emerald Realty of Tampa, LLC
|
|
Delaware
|
|
|
Encore II, Inc.
|
|
Arizona
|
|
|
Encore Venture Partners, L.P.
|
|
Delaware
|
|
|
Encore Venture Partners II (California), L.P.
|
|
Delaware
|
|
|
Encore Venture Partners II (Texas), L.P.
|
|
Delaware
|
|
|
Express Homes Realty of Alabama, LLC
|
|
Delaware
|
|
|
Express Realty of Central Florida, LLC
|
|
Delaware
|
|
|
Express Realty of North Florida, LLC
|
|
Delaware
|
|
|
Express Realty of Northwest Florida, LLC
|
|
Delaware
|
|
|
Express Realty of Southeast Florida, LLC
|
|
Delaware
|
|
|
Express Realty of Southwest Florida, LLC
|
|
Delaware
|
|
|
Express Realty of Tampa, LLC
|
|
Delaware
|
|
|
Force Merger Sub, Inc.
|
|
Delaware
|
|
|
Founders Oil & Gas, LLC
|
|
Delaware
|
|
|
Founders Oil & Gas II, LLC
|
|
Delaware
|
|
|
Founders Oil & Gas III, LLC
|
|
Delaware
|
|
|
Founders Oil & Gas Operating, LLC
|
|
Delaware
|
|
|
Freedom Realty of Tampa, LLC
|
|
Delaware
|
|
|
Georgetown Data, Inc.
|
|
Texas
|
|
|
Germann & McQueen, L.L.C.
|
|
Arizona
|
|
|
GP-Encore, Inc.
|
|
Arizona
|
|
|
Grande Realty Incorporated
|
|
New Jersey
|
|
D.R. Horton Realty, Inc.
|
Grande Realty of Pennsylvania, LLC
|
|
Delaware
|
|
|
Grand Title Agency, LLC
|
|
New Jersey
|
|
|
Greywes, LLC
|
|
California
|
|
D.R. Horton America’s Builder
|
Hadian, LLC
|
|
Delaware
|
|
|
Haskell Canyon Partners, L.P.
|
|
California
|
|
|
Haskell Canyon Partners II, L.P.
|
|
California
|
|
|
HPH Homebuilders 2000 L.P.
|
|
California
|
|
|
Iao Partners, a Hawaii General Partnership
|
|
Hawaii
|
|
|
Kaomalo LLC
|
|
Hawaii
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
KDB Homes, Inc.
|
|
Delaware
|
|
Continental Homes; Continental Welcome Home; D.R. Horton - Continental Series; D.R. Horton America’s Builder
|
Martin Road Lake Forest, LLC
|
|
Colorado
|
|
|
McQueen & Willis, LLC
|
|
Arizona
|
|
|
Meadows I, Ltd.
|
|
Delaware
|
|
|
Meadows II, Ltd.
|
|
Delaware
|
|
|
Meadows VIII, Ltd.
|
|
Delaware
|
|
|
Meadows IX, Inc.
|
|
New Jersey
|
|
|
Meadows X, Inc.
|
|
New Jersey
|
|
|
Melody Homes, Inc.
|
|
Delaware
|
|
D.R. Horton - Melody Series; D. Jensen Homes, Inc.; D.R. Horton America’s Builder; Emerald Homes; Express Homes; Freedom Homes
|
Metro Title, LLC
|
|
Virginia
|
|
|
MRLF, LLC
|
|
Colorado
|
|
|
Pacific Ridge - DRH, LLC
|
|
Delaware
|
|
D.R. Horton; Pacific Ridge; Pacific Ridge - DRH
|
Rielly Carlsbad LLC
|
|
Delaware
|
|
|
Rielly Homes Madison, LLC
|
|
Delaware
|
|
|
Schuler Homes of Arizona LLC
|
|
Delaware
|
|
D.R. Horton - Continental Series; D.R. Horton - Schuler Series; D.R. Horton - Astanté Series
|
Schuler Homes of California, Inc.
|
|
California
|
|
|
Schuler Homes of Oregon, Inc.
|
|
Oregon
|
|
|
Schuler Homes of Washington, Inc.
|
|
Washington
|
|
Keys & Schuler Homes; Schuler Homes Northwest
|
SGS Communities at Grand Quay L.L.C
|
|
New Jersey
|
|
|
SHA Construction LLC
|
|
Delaware
|
|
|
SHLR of California, Inc.
|
|
California
|
|
|
SHLR of Nevada, Inc.
|
|
Nevada
|
|
|
SHLR of Washington, Inc.
|
|
Washington
|
|
|
SRHI LLC
|
|
Delaware
|
|
D.R. Horton America’s Builder
|
SSHI LLC
|
|
Delaware
|
|
DR Horton; D.R. Horton; DR Horton Custom Homes; D.R. Horton Custom Homes; Stafford Homes; Emerald Homes; Express Homes
|
Surprise Village North, LLC
|
|
Arizona
|
|
Arizona Traditions
|
Travis County Title Company
|
|
Texas
|
|
DHI Title of Georgia; DHI Title of Central Texas; DHI Title of North Carolina
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
Treasure Assets, LLC
|
|
Delaware
|
|
|
Venture Management of South Carolina, LLC
|
|
South Carolina
|
|
|
Vertical Construction Corporation
|
|
Delaware
|
|
|
Western Pacific Brea Development, LLC
|
|
Delaware
|
|
|
Western Pacific Housing, Inc.
|
|
Delaware
|
|
D.R. Horton America’s Builder; D.R. Horton Homes Western Pacific Housing San Diego Division; Emerald Homes; Express Homes; Freedom Homes
|
Western Pacific Housing-Antigua, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Broadway, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Canyon Park, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Carrillo, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Communications Hill, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Copper Canyon, LLC
|
|
Delaware
|
|
|
Western Pacific Housing - Coto Venture, L.P.
|
|
California
|
|
|
Western Pacific Housing-Creekside, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Lomas Verdes, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Lyons Canyon Partners, LLC
|
|
Delaware
|
|
|
Western Pacific Housing Management, Inc.
|
|
California
|
|
D.R. Horton America’s Builder; Emerald Homes; Express Homes
|
Western Pacific Housing-McGonigle Canyon, LLC
|
|
Delaware
|
|
|
Western Pacific Housing - Mountaingate, L.P.
|
|
California
|
|
|
Western Pacific Housing-Norco Estates, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Pacific Park II, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Park Avenue East, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Park Avenue West, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Playa Vista, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-River Ridge, LLC
|
|
Delaware
|
|
|
Western Pacific Housing - SDG, LLC
|
|
California
|
|
|
Western Pacific Housing-Terra Bay Duets, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Torrey Meadows, LLC
|
|
Delaware
|
|
|
Western Pacific Housing-Torrey Village Center, LLC
|
|
Delaware
|
|
|
Western Pacific Housing - Westlake II, L.P.
|
|
California
|
|
|
Western Pacific Housing-Windemere, LLC
|
|
Delaware
|
|
|
WPH-Camino Ruiz, LLC
|
|
Delaware
|
|
|
NAME
|
|
STATE OF
INCORPORATION OR ORGANIZATION
|
|
DOING BUSINESS AS
|
WPH-Copper Canyon, LLC
|
|
Delaware
|
|
|
WPH-Copper Canyon II, LLC
|
|
Delaware
|
|
|
WPHD/Camarillo, LLC
|
|
California
|
|
|
WPHD/Ventura, LLC
|
|
California
|
|
|
11241 Slater Avenue NE, LLC
|
|
Delaware
|
|
|
2 C Development Company LLC
|
|
California
|
|
|
8800 Roswell Road Bldg. B, LLC
|
|
Delaware
|
|
|
91
st
Avenue & Happy Valley, L.L.C.
|
|
Arizona
|
|
|
1.
|
I have reviewed this Annual Report on Form 10-K 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.
|
|
/s/ D
AVID
V. A
ULD
|
|
By:
|
David V. Auld
President and Chief Executive Officer
|
|
1.
|
I have reviewed this Annual Report on Form 10-K 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.
|
|
/s/ B
ILL
W. W
HEAT
|
|
By:
|
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:
|
|
November 15, 2017
|
|
/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:
|
|
November 15, 2017
|
|
/s/ B
ILL
W. W
HEAT
|
|
|
|
By:
|
Bill W. Wheat
Executive Vice President and
Chief Financial Officer
|