x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
DELAWARE
|
|
58-2086934
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. employer
Identification no.)
|
Large accelerated filer
|
¨
|
Accelerated filer
|
x
|
|
|
|
|
Non-accelerated filer
|
¨
|
Smaller reporting company
|
¨
|
Class
|
|
Outstanding at February 1, 2016
|
Common Stock, $0.001 par value
|
|
33,092,491
|
•
|
economic changes nationally or in local markets, including changes in consumer confidence, declines in employment levels, inflation and increases in the quantity and decreases in the price of new homes and resale homes on the market;
|
•
|
the cyclical nature of the homebuilding industry and a potential deterioration in homebuilding industry conditions;
|
•
|
continuing severe weather conditions or other related events could result in delays in land development or home construction, increase our costs or decrease demand in the impacted areas;
|
•
|
our cost of and ability to access capital, due to factors such as limitations in the capital markets or adverse credit market conditions, and otherwise meet our ongoing liquidity needs, including the impact of any downgrades of our credit ratings or reductions in our tangible net worth or liquidity levels;
|
•
|
our ability to reduce our outstanding indebtedness and to comply with covenants in our debt agreements or satisfy such obligations through repayment or refinancing;
|
•
|
the availability and cost of land and the risks associated with the future value of our inventory, such as additional asset impairment charges or writedowns;
|
•
|
estimates related to homes to be delivered in the future (backlog) are imprecise, as they are subject to various cancellation risks that cannot be fully controlled;
|
•
|
shortages of or increased prices for labor, land or raw materials used in housing production and the level of quality and craftsmanship provided by our subcontractors;
|
•
|
a substantial increase in mortgage interest rates, increased disruption in the availability of mortgage financing, a change in tax laws regarding the deductibility of mortgage interest for tax purposes or an increased number of foreclosures;
|
•
|
increased competition or delays in reacting to changing consumer preferences in home design;
|
•
|
factors affecting margins, such as decreased land values underlying land option agreements, increased land development costs on communities under development or delays or difficulties in implementing initiatives to reduce our production and overhead cost structure;
|
•
|
estimates related to the potential recoverability of our deferred tax assets;
|
•
|
potential delays or increased costs in obtaining necessary permits as a result of changes to, or complying with, laws, regulations or governmental policies, and possible penalties for failure to comply with such laws, regulations and governmental policies, including those related to the environment;
|
•
|
the results of litigation or government proceedings and fulfillment of the obligations in the consent orders with governmental authorities and other settlement agreements;
|
•
|
the impact of construction defect and home warranty claims, including water intrusion issues in Florida and New Jersey;
|
•
|
the cost and availability of insurance and surety bonds;
|
•
|
the performance of our unconsolidated entities and our unconsolidated entity partners;
|
•
|
the impact of information technology failures or data security breaches;
|
•
|
terrorist acts, natural disasters, acts of war or other factors over which the Company has little or no control; or
|
•
|
the impact on homebuilding in key markets of governmental regulations limiting the availability of water.
|
|
December 31,
2015 |
|
September 30,
2015 |
||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents
|
$
|
144,881
|
|
|
$
|
251,583
|
|
Restricted cash
|
39,351
|
|
|
38,901
|
|
||
Accounts receivable (net of allowance of $921 and $1,052, respectively)
|
50,555
|
|
|
52,379
|
|
||
Income tax receivable
|
269
|
|
|
419
|
|
||
Owned inventory
|
1,729,937
|
|
|
1,697,590
|
|
||
Investments in unconsolidated entities
|
11,721
|
|
|
13,734
|
|
||
Deferred tax assets, net
|
325,058
|
|
|
325,373
|
|
||
Property and equipment, net
|
20,236
|
|
|
22,230
|
|
||
Other assets
|
16,688
|
|
|
18,994
|
|
||
Total assets
|
$
|
2,338,696
|
|
|
$
|
2,421,203
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Trade accounts payable
|
$
|
81,395
|
|
|
$
|
113,539
|
|
Other liabilities
|
122,268
|
|
|
148,966
|
|
||
Total debt (net of discounts of $3,449 and $3,639, respectively)
|
1,502,056
|
|
|
1,528,275
|
|
||
Total liabilities
|
1,705,719
|
|
|
1,790,780
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock (par value $.01 per share, 5,000,000 shares authorized, no shares issued)
|
—
|
|
|
—
|
|
||
Common stock (par value $0.001 per share, 63,000,000 shares authorized, 33,092,491 issued and outstanding and 32,660,583 issued and outstanding, respectively)
|
33
|
|
|
33
|
|
||
Paid-in capital
|
859,108
|
|
|
857,553
|
|
||
Accumulated deficit
|
(226,164
|
)
|
|
(227,163
|
)
|
||
Total stockholders’ equity
|
632,977
|
|
|
630,423
|
|
||
Total liabilities and stockholders’ equity
|
$
|
2,338,696
|
|
|
$
|
2,421,203
|
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Total revenue
|
$
|
344,449
|
|
|
$
|
265,764
|
|
Home construction and land sales expenses
|
285,511
|
|
|
230,546
|
|
||
Inventory impairments and abandonments
|
1,356
|
|
|
—
|
|
||
Gross profit
|
57,582
|
|
|
35,218
|
|
||
Commissions
|
13,774
|
|
|
10,926
|
|
||
General and administrative expenses
|
31,669
|
|
|
31,441
|
|
||
Depreciation and amortization
|
2,991
|
|
|
2,341
|
|
||
Operating income (loss)
|
9,148
|
|
|
(9,490
|
)
|
||
Equity in income of unconsolidated entities
|
60
|
|
|
142
|
|
||
Loss on extinguishment of debt
|
(828
|
)
|
|
—
|
|
||
Other expense, net
|
(6,565
|
)
|
|
(9,434
|
)
|
||
Income (loss) from continuing operations before income taxes
|
1,815
|
|
|
(18,782
|
)
|
||
Expense (benefit) from income taxes
|
616
|
|
|
(696
|
)
|
||
Income (loss) from continuing operations
|
1,199
|
|
|
(18,086
|
)
|
||
Loss from discontinued operations, net of tax
|
(200
|
)
|
|
(4,254
|
)
|
||
Net income (loss)
|
$
|
999
|
|
|
$
|
(22,340
|
)
|
Weighted average number of shares:
|
|
|
|
||||
Basic
|
31,757
|
|
|
26,457
|
|
||
Diluted
|
31,844
|
|
|
26,457
|
|
||
Basic income (loss) per share:
|
|
|
|
||||
Continuing operations
|
$
|
0.04
|
|
|
$
|
(0.68
|
)
|
Discontinued operations
|
$
|
(0.01
|
)
|
|
$
|
(0.16
|
)
|
Total
|
$
|
0.03
|
|
|
$
|
(0.84
|
)
|
Diluted income (loss) per share
|
|
|
|
||||
Continuing operations
|
$
|
0.04
|
|
|
$
|
(0.68
|
)
|
Discontinued operations
|
$
|
(0.01
|
)
|
|
$
|
(0.16
|
)
|
Total
|
$
|
0.03
|
|
|
$
|
(0.84
|
)
|
|
|
|
|
||||
Consolidated Statement of Comprehensive Income (Loss)
|
|||||||
Net income (loss)
|
$
|
999
|
|
|
$
|
(22,340
|
)
|
Other comprehensive income (loss), net of income tax:
|
|
|
|
||||
Change in unrealized loss related to available-for-sale securities
|
—
|
|
|
206
|
|
||
Comprehensive income (loss)
|
$
|
999
|
|
|
$
|
(22,134
|
)
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
|
2015
|
|
2014
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
999
|
|
|
$
|
(22,340
|
)
|
Adjustments to reconcile net income (loss) to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
2,991
|
|
|
2,341
|
|
||
Stock-based compensation expense
|
1,756
|
|
|
1,375
|
|
||
Inventory impairments and abandonments
|
1,356
|
|
|
—
|
|
||
Deferred and other income tax expense (benefit)
|
318
|
|
|
(765
|
)
|
||
Gain on sale of fixed assets
|
(771
|
)
|
|
—
|
|
||
Change in allowance for doubtful accounts
|
(131
|
)
|
|
22
|
|
||
Equity in income of unconsolidated entities and marketable securities
|
(60
|
)
|
|
(142
|
)
|
||
Cash distributions of income from marketable securities and unconsolidated entities
|
—
|
|
|
34
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Decrease in accounts receivable
|
1,955
|
|
|
2,091
|
|
||
Decrease in income tax receivable
|
150
|
|
|
—
|
|
||
Increase in inventory
|
(28,168
|
)
|
|
(104,434
|
)
|
||
Decrease in other assets
|
1,660
|
|
|
1,159
|
|
||
Decrease in trade accounts payable
|
(32,144
|
)
|
|
(40,392
|
)
|
||
Decrease in other liabilities
|
(27,760
|
)
|
|
(11,432
|
)
|
||
Other changes
|
—
|
|
|
(49
|
)
|
||
Net cash used in operating activities
|
(77,849
|
)
|
|
(172,532
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(2,663
|
)
|
|
(2,934
|
)
|
||
Proceeds from sale of fixed assets
|
2,437
|
|
|
—
|
|
||
Investments in unconsolidated entities
|
(1,779
|
)
|
|
(1,144
|
)
|
||
Return of capital from unconsolidated entities
|
1,142
|
|
|
—
|
|
||
Increases in restricted cash
|
(1,119
|
)
|
|
(1,445
|
)
|
||
Decreases in restricted cash
|
669
|
|
|
294
|
|
||
Net cash used in investing activities
|
(1,313
|
)
|
|
(5,229
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Repayment of debt
|
(26,926
|
)
|
|
(7,388
|
)
|
||
Debt issuance costs
|
(413
|
)
|
|
(126
|
)
|
||
Other financing activities
|
(201
|
)
|
|
(199
|
)
|
||
Net cash used in financing activities
|
(27,540
|
)
|
|
(7,713
|
)
|
||
Decrease in cash and cash equivalents
|
(106,702
|
)
|
|
(185,474
|
)
|
||
Cash and cash equivalents at beginning of period
|
251,583
|
|
|
324,154
|
|
||
Cash and cash equivalents at end of period
|
$
|
144,881
|
|
|
$
|
138,680
|
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Supplemental disclosure of non-cash activity:
|
|
|
|
||||
Decrease in obligations related to land not owned under option agreements
|
$
|
—
|
|
|
$
|
(1,668
|
)
|
Non-cash land acquisitions
(a)
|
3,769
|
|
|
12,904
|
|
||
Supplemental disclosure of cash activity:
|
|
|
|
||||
Interest payments
|
39,740
|
|
|
42,709
|
|
||
Income tax payments
|
146
|
|
|
62
|
|
||
Tax refunds received
|
150
|
|
|
—
|
|
(In thousands)
|
December 31, 2015
|
|
September 30, 2015
|
||||
Beazer’s investment in unconsolidated entities
|
$
|
11,722
|
|
|
$
|
13,734
|
|
Total equity of unconsolidated entities
|
45,047
|
|
|
52,118
|
|
||
Total outstanding borrowings of unconsolidated entities
|
12,859
|
|
|
12,206
|
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Equity in income of unconsolidated entities
|
$
|
60
|
|
|
$
|
142
|
|
(In thousands)
|
December 31, 2015
|
|
September 30, 2015
|
||||
Homes under construction
|
$
|
386,409
|
|
|
$
|
377,281
|
|
Development projects in progress
|
808,223
|
|
|
809,900
|
|
||
Land held for future development
|
271,321
|
|
|
270,990
|
|
||
Land held for sale
|
54,546
|
|
|
44,555
|
|
||
Capitalized interest
|
132,462
|
|
|
123,457
|
|
||
Model homes
|
76,976
|
|
|
71,407
|
|
||
Total owned inventory
|
$
|
1,729,937
|
|
|
$
|
1,697,590
|
|
(In thousands)
|
Projects in
Progress
(a)
|
|
Land Held for Future Development
|
|
Land Held
for Sale
|
|
Total Owned
Inventory
|
||||||||
December 31, 2015
|
|
|
|
|
|
|
|
||||||||
West Segment
|
$
|
598,776
|
|
|
$
|
231,119
|
|
|
$
|
6,571
|
|
|
$
|
836,466
|
|
East Segment
|
349,678
|
|
|
29,280
|
|
|
30,279
|
|
|
409,237
|
|
||||
Southeast Segment
|
274,772
|
|
|
10,922
|
|
|
16,597
|
|
|
302,291
|
|
||||
Corporate and unallocated
|
180,844
|
|
(b)
|
—
|
|
|
1,099
|
|
|
181,943
|
|
||||
Total
|
$
|
1,404,070
|
|
|
$
|
271,321
|
|
|
$
|
54,546
|
|
|
$
|
1,729,937
|
|
September 30, 2015
|
|
|
|
|
|
|
|
||||||||
West Segment
|
$
|
583,210
|
|
|
$
|
230,778
|
|
|
$
|
6,941
|
|
|
$
|
820,929
|
|
East Segment
|
353,054
|
|
|
29,280
|
|
|
30,927
|
|
|
413,261
|
|
||||
Southeast Segment
|
277,351
|
|
|
10,932
|
|
|
5,587
|
|
|
293,870
|
|
||||
Corporate and unallocated
|
168,430
|
|
(b)
|
—
|
|
|
1,100
|
|
|
169,530
|
|
||||
Total
|
$
|
1,382,045
|
|
|
$
|
270,990
|
|
|
$
|
44,555
|
|
|
$
|
1,697,590
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Three Months Ended December 31,
|
||
(In thousands)
|
2015
|
||
Land Held for Sale:
|
|
||
East
|
$
|
197
|
|
Southeast
|
371
|
|
|
Total impairment charges on land held for sale
|
$
|
568
|
|
Abandonments:
|
|
||
Southeast
|
$
|
788
|
|
Total impairment and abandonment charges
|
$
|
1,356
|
|
(In thousands)
|
Deposits &
Non-refundable
Pre-acquisition
Costs Incurred
|
|
Remaining
Obligation
|
||||
As of December 31, 2015
|
|
|
|
||||
Unconsolidated lot option agreements
|
$
|
65,552
|
|
|
$
|
421,098
|
|
As of September 30, 2015
|
|
|
|
||||
Unconsolidated lot option agreements
|
$
|
51,475
|
|
|
$
|
420,070
|
|
|
Three Months Ended December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Capitalized interest in inventory, beginning of period
|
$
|
123,457
|
|
|
$
|
87,619
|
|
Interest incurred
|
30,088
|
|
|
30,283
|
|
||
Interest expense not qualified for capitalization and included as other expense
(a)
|
(7,432
|
)
|
|
(9,747
|
)
|
||
Capitalized interest amortized to house construction and land sales expenses
(b)
|
(13,651
|
)
|
|
(8,287
|
)
|
||
Capitalized interest in inventory, end of period
|
$
|
132,462
|
|
|
$
|
99,868
|
|
Senior Note Description
|
|
Issuance Date
|
|
Maturity Date
|
|
Redemption Terms
|
8 1/8% Senior Notes
|
|
June 2006
|
|
June 2016
|
|
Callable at any time, in whole or in part, based on a customary make-whole premium amount
|
6 5/8% Senior Secured Notes
|
|
July 2012
|
|
April 2018
|
|
Callable at any time, in whole or in part, at a set redemption price; redemption price is currently equal to 103.313% of the principal amount and resets on July 15, 2016 to a redemption price equal to 101.656% of the principal amount
|
9 1/8% Senior Notes
|
|
November 2010
|
|
May 2019
|
|
Callable at any time, in whole or in part, at a redemption price equal to 102.281% of the principal amount
|
5 3/4% Senior Notes
|
|
April 2014
|
|
June 2019
|
|
Callable at any time before March 15, 2019, in whole or in part, at a redemption price equal to 100% of the principal amount, plus a customary make-whole premium
|
7 1/2% Senior Notes
|
|
February 2013
|
|
September 2021
|
|
Callable at any time prior to September 15, 2016, in whole or in part, at a redemption price equal to 100% of the principal amount, plus a customary make-whole premium; after September 15, 2016, callable at a redemption price equal to 105.625% of the principal amount; after September 15, 2017, callable at a redemption price equal to 103.75% of the principal amount; after September 15, 2018, callable at a redemption price equal to 101.875% of the principal amount
|
7 1/4% Senior Notes
|
|
September 2013
|
|
February 2023
|
|
Callable at any time prior to February 1, 2018, in whole or in part, at a redemption price equal to 100% of the principal amount, plus a customary make-whole premium; after February 1, 2018, callable at a redemption price equal to 103.625% of the principal amount; after February 1, 2019, callable at a redemption price equal to 102.41% of the principal amount; after February 1, 2020, callable at a redemption price equal to 101.208% of the principal amount
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Balance at beginning of period
|
$
|
27,681
|
|
|
$
|
16,084
|
|
Accruals for warranties issued
(a)
|
2,615
|
|
|
1,525
|
|
||
Changes in liability related to warranties existing in prior periods
(b)
|
10,600
|
|
|
14,230
|
|
||
Payments made
(b)
|
(11,983
|
)
|
|
(4,612
|
)
|
||
Balance at end of period
|
$
|
28,913
|
|
|
$
|
27,227
|
|
•
|
Level 1 – Quoted prices in active markets for identical assets or liabilities;
|
•
|
Level 2 – Inputs other than quoted prices included in Level 1 that are observable either directly or indirectly through corroboration with market data; and
|
•
|
Level 3 – Unobservable inputs that reflect our own estimates about the assumptions market participants would use in pricing the asset or liability.
|
(In thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Three Months Ended December 31, 2015
|
|
|
|
|
|
|
|
||||||||
Deferred compensation plan assets
(a)
|
$
|
—
|
|
|
$
|
747
|
|
|
$
|
—
|
|
|
$
|
747
|
|
Land held for sale
(b)
|
—
|
|
|
—
|
|
|
16,213
|
|
|
16,213
|
|
||||
Three Months Ended December 31, 2014
|
|
|
|
|
|
|
|
||||||||
Available-for-sale marketable equity securities
(a)
|
$
|
24,970
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24,970
|
|
Deferred compensation plan assets
(a)
|
—
|
|
|
775
|
|
|
—
|
|
|
775
|
|
(In thousands)
|
As of December 31, 2015
|
|
As of September 30, 2015
|
||||||||||||
|
Carrying
Amount |
|
Fair Value
|
|
Carrying
Amount |
|
Fair Value
|
||||||||
Senior Notes
|
$
|
1,404,555
|
|
|
$
|
1,344,039
|
|
|
$
|
1,427,240
|
|
|
$
|
1,412,173
|
|
Junior Subordinated Notes
|
58,320
|
|
|
58,320
|
|
|
57,803
|
|
|
57,803
|
|
||||
|
$
|
1,462,875
|
|
|
$
|
1,402,359
|
|
|
$
|
1,485,043
|
|
|
$
|
1,469,976
|
|
|
|
Three Months Ended December 31, 2015
|
||||||
(In millions)
|
|
2015
|
|
2014
|
||||
Stock options expense
|
|
$
|
0.2
|
|
|
$
|
0.2
|
|
Restricted stock awards expense
|
|
1.6
|
|
|
1.2
|
|
||
Before tax stock-based compensation expense
|
|
1.8
|
|
|
1.4
|
|
||
Tax benefit
|
|
(0.6
|
)
|
|
(0.3
|
)
|
||
After tax stock-based compensation expense
|
|
$
|
1.2
|
|
|
$
|
1.1
|
|
|
|
Three Months Ended
|
||
|
|
December 31, 2015
|
||
Expected life of options
|
|
4.3 years
|
|
|
Expected volatility
|
|
45.23
|
%
|
|
Expected dividends
|
|
—
|
|
|
Weighted average risk-free interest rate
|
|
1.70
|
%
|
|
Weighted average fair value
|
|
$
|
5.48
|
|
|
Three Months Ended
|
|||||
|
December 31, 2015
|
|||||
|
Shares
|
|
Weighted Average
Exercise Price |
|||
Outstanding at beginning of period
|
643,907
|
|
|
$
|
18.13
|
|
Granted
|
40,600
|
|
|
14.24
|
|
|
Outstanding at end of period
|
684,507
|
|
|
$
|
17.90
|
|
Exercisable at end of period
|
591,844
|
|
|
$
|
18.04
|
|
Vested or expected to vest in the future
|
684,477
|
|
|
$
|
17.90
|
|
|
Three Months Ended
|
|||||
|
December 31, 2015
|
|||||
|
Shares
|
|
Weighted Average
Grant Date Fair Value |
|||
Beginning of period
|
956,283
|
|
|
$
|
18.27
|
|
Granted
|
481,976
|
|
|
14.81
|
|
|
Vested
|
(114,253
|
)
|
|
18.79
|
|
|
Forfeited
|
(35,532
|
)
|
|
5.73
|
|
|
End of period
|
1,288,474
|
|
|
$
|
17.28
|
|
|
|
Three Months Ended December 31,
|
||||
(in thousands)
|
|
2015
|
|
2014
|
||
Basic shares
|
|
31,757
|
|
|
26,457
|
|
Shares issuable upon vesting/exercise of stock awards/options
|
|
87
|
|
|
N/A
(a)
|
|
Diluted shares
|
|
31,844
|
|
|
26,457
|
|
(In thousands)
|
December 31, 2015
|
|
September 30, 2015
|
||||
Accrued warranty expense
|
$
|
28,913
|
|
|
$
|
27,681
|
|
Accrued interest
|
20,215
|
|
|
31,632
|
|
||
Customer deposits
|
13,284
|
|
|
13,757
|
|
||
Accrued bonuses and deferred comp
|
10,073
|
|
|
25,076
|
|
||
Litigation accrual
|
13,612
|
|
|
12,607
|
|
||
Income tax liabilities
|
1,910
|
|
|
1,998
|
|
||
Other
|
34,261
|
|
|
36,215
|
|
||
Total Other Liabilities
|
$
|
122,268
|
|
|
$
|
148,966
|
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Operating income (loss)
|
|
|
|
||||
West
|
$
|
16,786
|
|
|
$
|
6,783
|
|
East
|
4,147
|
|
|
7,369
|
|
||
Southeast
|
10,657
|
|
|
(6,233
|
)
|
||
Segment total
|
31,590
|
|
|
7,919
|
|
||
Corporate and unallocated
(a)
|
(22,442
|
)
|
|
(17,409
|
)
|
||
Total operating income (loss)
|
$
|
9,148
|
|
|
$
|
(9,490
|
)
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Depreciation and amortization
|
|
|
|
||||
West
|
$
|
1,218
|
|
|
$
|
767
|
|
East
|
797
|
|
|
668
|
|
||
Southeast
|
449
|
|
|
485
|
|
||
Segment total
|
2,464
|
|
|
1,920
|
|
||
Corporate and unallocated
(a)
|
527
|
|
|
421
|
|
||
Depreciation and amortization - continuing operations
|
$
|
2,991
|
|
|
$
|
2,341
|
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Capital Expenditures
|
|
|
|
||||
West
|
$
|
1,133
|
|
|
$
|
1,070
|
|
East
|
467
|
|
|
799
|
|
||
Southeast
|
969
|
|
|
862
|
|
||
Corporate and unallocated
|
94
|
|
|
203
|
|
||
Total capital expenditures
|
$
|
2,663
|
|
|
$
|
2,934
|
|
(In thousands)
|
December 31, 2015
|
|
September 30, 2015
|
||||
Assets
|
|
|
|
||||
West
|
$
|
855,207
|
|
|
$
|
843,564
|
|
East
|
418,575
|
|
|
436,346
|
|
||
Southeast
|
322,695
|
|
|
317,295
|
|
||
Corporate and unallocated
(a)
|
742,219
|
|
|
823,998
|
|
||
Total assets
|
$
|
2,338,696
|
|
|
$
|
2,421,203
|
|
|
Beazer Homes
USA, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Consolidating
Adjustments |
|
Consolidated
Beazer Homes USA, Inc. |
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
152,824
|
|
|
$
|
(547
|
)
|
|
$
|
988
|
|
|
$
|
(8,384
|
)
|
|
$
|
144,881
|
|
Restricted cash
|
37,708
|
|
|
1,643
|
|
|
—
|
|
|
—
|
|
|
39,351
|
|
|||||
Accounts receivable (net of allowance of $921)
|
—
|
|
|
50,555
|
|
|
—
|
|
|
—
|
|
|
50,555
|
|
|||||
Income tax receivable
|
269
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
269
|
|
|||||
Owned inventory
|
—
|
|
|
1,729,937
|
|
|
—
|
|
|
—
|
|
|
1,729,937
|
|
|||||
Investments in unconsolidated entities and marketable securities
|
773
|
|
|
10,948
|
|
|
—
|
|
|
—
|
|
|
11,721
|
|
|||||
Deferred tax assets, net
|
325,058
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
325,058
|
|
|||||
Property and equipment, net
|
—
|
|
|
20,236
|
|
|
—
|
|
|
—
|
|
|
20,236
|
|
|||||
Investments in subsidiaries
|
662,183
|
|
|
—
|
|
|
—
|
|
|
(662,183
|
)
|
|
—
|
|
|||||
Intercompany
|
950,547
|
|
|
—
|
|
|
2,384
|
|
|
(952,931
|
)
|
|
—
|
|
|||||
Other assets
|
11,874
|
|
|
4,814
|
|
|
—
|
|
|
—
|
|
|
16,688
|
|
|||||
Total assets
|
$
|
2,141,236
|
|
|
$
|
1,817,586
|
|
|
$
|
3,372
|
|
|
$
|
(1,623,498
|
)
|
|
$
|
2,338,696
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Trade accounts payable
|
$
|
—
|
|
|
$
|
81,395
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
81,395
|
|
Other liabilities
|
20,632
|
|
|
101,138
|
|
|
498
|
|
|
—
|
|
|
122,268
|
|
|||||
Intercompany
|
2,384
|
|
|
958,931
|
|
|
—
|
|
|
(961,315
|
)
|
|
—
|
|
|||||
Total debt (net of discounts of $3,449)
|
1,485,243
|
|
|
16,813
|
|
|
—
|
|
|
—
|
|
|
1,502,056
|
|
|||||
Total liabilities
|
1,508,259
|
|
|
1,158,277
|
|
|
498
|
|
|
(961,315
|
)
|
|
1,705,719
|
|
|||||
Stockholders’ equity
|
632,977
|
|
|
659,309
|
|
|
2,874
|
|
|
(662,183
|
)
|
|
632,977
|
|
|||||
Total liabilities and stockholders’ equity
|
$
|
2,141,236
|
|
|
$
|
1,817,586
|
|
|
$
|
3,372
|
|
|
$
|
(1,623,498
|
)
|
|
$
|
2,338,696
|
|
|
Beazer Homes
USA, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Consolidating
Adjustments |
|
Consolidated
Beazer Homes USA, Inc. |
||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
232,226
|
|
|
$
|
21,543
|
|
|
$
|
1,006
|
|
|
$
|
(3,192
|
)
|
|
$
|
251,583
|
|
Restricted cash
|
37,177
|
|
|
1,724
|
|
|
—
|
|
|
—
|
|
|
38,901
|
|
|||||
Accounts receivable (net of allowance of $1,052)
|
—
|
|
|
52,378
|
|
|
1
|
|
|
—
|
|
|
52,379
|
|
|||||
Income tax receivable
|
419
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
419
|
|
|||||
Owned inventory
|
—
|
|
|
1,697,590
|
|
|
—
|
|
|
—
|
|
|
1,697,590
|
|
|||||
Consolidated inventory not owned
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Investments in marketable securities and unconsolidated entities
|
773
|
|
|
12,961
|
|
|
—
|
|
|
—
|
|
|
13,734
|
|
|||||
Deferred tax assets, net
|
325,373
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
325,373
|
|
|||||
Property and equipment, net
|
—
|
|
|
22,230
|
|
|
—
|
|
|
—
|
|
|
22,230
|
|
|||||
Investments in subsidiaries
|
649,701
|
|
|
—
|
|
|
—
|
|
|
(649,701
|
)
|
|
—
|
|
|||||
Intercompany
|
913,733
|
|
|
—
|
|
|
2,384
|
|
|
(916,117
|
)
|
|
—
|
|
|||||
Other assets
|
12,519
|
|
|
6,471
|
|
|
4
|
|
|
—
|
|
|
18,994
|
|
|||||
Total assets
|
$
|
2,171,921
|
|
|
$
|
1,814,897
|
|
|
$
|
3,395
|
|
|
$
|
(1,569,010
|
)
|
|
$
|
2,421,203
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
||||||||||
Trade accounts payable
|
$
|
—
|
|
|
$
|
113,539
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
113,539
|
|
Other liabilities
|
31,703
|
|
|
116,718
|
|
|
545
|
|
|
—
|
|
|
148,966
|
|
|||||
Intercompany
|
2,384
|
|
|
916,925
|
|
|
—
|
|
|
(919,309
|
)
|
|
—
|
|
|||||
Obligations related to land not owned under option agreements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total debt (net of discounts of $3,639)
|
1,507,411
|
|
|
20,864
|
|
|
—
|
|
|
—
|
|
|
1,528,275
|
|
|||||
Total liabilities
|
1,541,498
|
|
|
1,168,046
|
|
|
545
|
|
|
(919,309
|
)
|
|
1,790,780
|
|
|||||
Stockholders’ equity
|
630,423
|
|
|
646,851
|
|
|
2,850
|
|
|
(649,701
|
)
|
|
630,423
|
|
|||||
Total liabilities and stockholders’ equity
|
$
|
2,171,921
|
|
|
$
|
1,814,897
|
|
|
$
|
3,395
|
|
|
$
|
(1,569,010
|
)
|
|
$
|
2,421,203
|
|
|
Beazer Homes
USA, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Consolidating
Adjustments |
|
Consolidated
Beazer Homes USA, Inc. |
||||||||||
Three Months Ended December 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenue
|
$
|
—
|
|
|
$
|
344,449
|
|
|
$
|
73
|
|
|
$
|
(73
|
)
|
|
$
|
344,449
|
|
Home construction and land sales expenses
|
13,367
|
|
|
272,217
|
|
|
—
|
|
|
(73
|
)
|
|
285,511
|
|
|||||
Inventory impairments and abandonments
|
—
|
|
|
1,356
|
|
|
—
|
|
|
—
|
|
|
1,356
|
|
|||||
Gross (loss) profit
|
(13,367
|
)
|
|
70,876
|
|
|
73
|
|
|
—
|
|
|
57,582
|
|
|||||
Commissions
|
—
|
|
|
13,774
|
|
|
—
|
|
|
—
|
|
|
13,774
|
|
|||||
General and administrative expenses
|
—
|
|
|
31,642
|
|
|
27
|
|
|
|
|
|
31,669
|
|
|||||
Depreciation and amortization
|
—
|
|
|
2,991
|
|
|
—
|
|
|
—
|
|
|
2,991
|
|
|||||
Operating (loss) income
|
(13,367
|
)
|
|
22,469
|
|
|
46
|
|
|
—
|
|
|
9,148
|
|
|||||
Equity in income of unconsolidated entities
|
—
|
|
|
60
|
|
|
—
|
|
|
—
|
|
|
60
|
|
|||||
Loss on extinguishment of debt
|
(828
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(828
|
)
|
|||||
Other (expense) income, net
|
(7,432
|
)
|
|
868
|
|
|
(1
|
)
|
|
—
|
|
|
(6,565
|
)
|
|||||
(Loss) income before income taxes
|
(21,627
|
)
|
|
23,397
|
|
|
45
|
|
|
—
|
|
|
1,815
|
|
|||||
(Benefit from) provision for income taxes
|
(10,143
|
)
|
|
10,742
|
|
|
17
|
|
|
—
|
|
|
616
|
|
|||||
Equity in income of subsidiaries
|
12,683
|
|
|
—
|
|
|
—
|
|
|
(12,683
|
)
|
|
—
|
|
|||||
Income (loss) from continuing operations
|
1,199
|
|
|
12,655
|
|
|
28
|
|
|
(12,683
|
)
|
|
1,199
|
|
|||||
Loss from discontinued operations
|
—
|
|
|
(197
|
)
|
|
(3
|
)
|
|
—
|
|
|
(200
|
)
|
|||||
Equity in loss of subsidiaries from discontinued operations
|
(200
|
)
|
|
—
|
|
|
—
|
|
|
200
|
|
|
—
|
|
|||||
Net income (loss) and comprehensive income (loss)
|
$
|
999
|
|
|
$
|
12,458
|
|
|
$
|
25
|
|
|
$
|
(12,483
|
)
|
|
$
|
999
|
|
|
Beazer Homes
USA, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Consolidating
Adjustments |
|
Consolidated
Beazer Homes USA, Inc. |
||||||||||
Three Months Ended December 31, 2014
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenue
|
$
|
—
|
|
|
$
|
265,764
|
|
|
$
|
98
|
|
|
$
|
(98
|
)
|
|
$
|
265,764
|
|
Home construction and land sales expenses
|
8,194
|
|
|
222,450
|
|
|
—
|
|
|
(98
|
)
|
|
230,546
|
|
|||||
Gross (loss) profit
|
(8,194
|
)
|
|
43,314
|
|
|
98
|
|
|
—
|
|
|
35,218
|
|
|||||
Commissions
|
—
|
|
|
10,926
|
|
|
—
|
|
|
—
|
|
|
10,926
|
|
|||||
General and administrative expenses
|
—
|
|
|
31,414
|
|
|
27
|
|
|
—
|
|
|
31,441
|
|
|||||
Depreciation and amortization
|
—
|
|
|
2,341
|
|
|
—
|
|
|
—
|
|
|
2,341
|
|
|||||
Operating (loss) income
|
(8,194
|
)
|
|
(1,367
|
)
|
|
71
|
|
|
—
|
|
|
(9,490
|
)
|
|||||
Equity in loss of unconsolidated entities
|
—
|
|
|
142
|
|
|
—
|
|
|
—
|
|
|
142
|
|
|||||
Other (expense) income, net
|
(9,747
|
)
|
|
314
|
|
|
(1
|
)
|
|
—
|
|
|
(9,434
|
)
|
|||||
(Loss) income before income taxes
|
(17,941
|
)
|
|
(911
|
)
|
|
70
|
|
|
—
|
|
|
(18,782
|
)
|
|||||
(Benefit from) provision for income taxes
|
(6,627
|
)
|
|
5,906
|
|
|
25
|
|
|
—
|
|
|
(696
|
)
|
|||||
Equity in income of subsidiaries
|
(6,772
|
)
|
|
—
|
|
|
—
|
|
|
6,772
|
|
|
—
|
|
|||||
(Loss) income from continuing operations
|
(18,086
|
)
|
|
(6,817
|
)
|
|
45
|
|
|
6,772
|
|
|
(18,086
|
)
|
|||||
Loss from discontinued operations
|
—
|
|
|
(4,251
|
)
|
|
(3
|
)
|
|
—
|
|
|
(4,254
|
)
|
|||||
Equity in income of subsidiaries from discontinued operations
|
(4,254
|
)
|
|
—
|
|
|
—
|
|
|
4,254
|
|
|
—
|
|
|||||
Net (loss) income
|
$
|
(22,340
|
)
|
|
$
|
(11,068
|
)
|
|
$
|
42
|
|
|
$
|
11,026
|
|
|
$
|
(22,340
|
)
|
Change in unrealized loss related to available-for-sale securities
|
206
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
206
|
|
|||||
Comprehensive (loss) income
|
$
|
(22,134
|
)
|
|
$
|
(11,068
|
)
|
|
$
|
42
|
|
|
$
|
11,026
|
|
|
$
|
(22,134
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Beazer Homes
USA, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Consolidating
Adjustments |
|
Consolidated
Beazer Homes USA, Inc. |
||||||||||
Three Months Ended December 31, 2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash used in operating activities
|
$
|
(22,794
|
)
|
|
$
|
(55,038
|
)
|
|
$
|
(17
|
)
|
|
$
|
—
|
|
|
$
|
(77,849
|
)
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(2,663
|
)
|
|
—
|
|
|
—
|
|
|
(2,663
|
)
|
|||||
Proceeds from sale of fixed assets
|
—
|
|
|
2,437
|
|
|
—
|
|
|
—
|
|
|
2,437
|
|
|||||
Investments in unconsolidated entities
|
—
|
|
|
(1,779
|
)
|
|
—
|
|
|
—
|
|
|
(1,779
|
)
|
|||||
Proceeds from sale of marketable securities and unconsolidated entities
|
—
|
|
|
1,142
|
|
|
—
|
|
|
—
|
|
|
1,142
|
|
|||||
Increases in restricted cash
|
—
|
|
|
(1,119
|
)
|
|
—
|
|
|
—
|
|
|
(1,119
|
)
|
|||||
Decreases in restricted cash
|
—
|
|
|
669
|
|
|
—
|
|
|
—
|
|
|
669
|
|
|||||
Advances to/from subsidiaries
|
(33,119
|
)
|
|
—
|
|
|
—
|
|
|
33,119
|
|
|
—
|
|
|||||
Net cash (used in) provided by investing activities
|
(33,119
|
)
|
|
(1,313
|
)
|
|
—
|
|
|
33,119
|
|
|
(1,313
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Repayment of debt
|
(22,875
|
)
|
|
(4,051
|
)
|
|
—
|
|
|
—
|
|
|
(26,926
|
)
|
|||||
Debt issuance costs
|
(413
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(413
|
)
|
|||||
Advances to/from subsidiaries
|
—
|
|
|
38,312
|
|
|
(1
|
)
|
|
(38,311
|
)
|
|
—
|
|
|||||
Other financing activities
|
(201
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(201
|
)
|
|||||
Net cash (used in) provided by financing activities
|
(23,489
|
)
|
|
34,261
|
|
|
(1
|
)
|
|
(38,311
|
)
|
|
(27,540
|
)
|
|||||
Decrease in cash and cash equivalents
|
(79,402
|
)
|
|
(22,090
|
)
|
|
(18
|
)
|
|
(5,192
|
)
|
|
(106,702
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
232,226
|
|
|
21,543
|
|
|
1,006
|
|
|
(3,192
|
)
|
|
251,583
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
152,824
|
|
|
$
|
(547
|
)
|
|
$
|
988
|
|
|
$
|
(8,384
|
)
|
|
$
|
144,881
|
|
|
Beazer Homes
USA, Inc. |
|
Guarantor
Subsidiaries |
|
Non-Guarantor
Subsidiaries |
|
Consolidating
Adjustments |
|
Consolidated
Beazer Homes USA, Inc. |
||||||||||
Three Months Ended December 31, 2014
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash used in operating activities
|
$
|
(30,841
|
)
|
|
$
|
(141,603
|
)
|
|
$
|
(88
|
)
|
|
$
|
—
|
|
|
$
|
(172,532
|
)
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
(2,934
|
)
|
|
—
|
|
|
—
|
|
|
(2,934
|
)
|
|||||
Investments in unconsolidated entities
|
—
|
|
|
(1,144
|
)
|
|
—
|
|
|
—
|
|
|
(1,144
|
)
|
|||||
Increases in restricted cash
|
(959
|
)
|
|
(486
|
)
|
|
—
|
|
|
—
|
|
|
(1,445
|
)
|
|||||
Decreases in restricted cash
|
—
|
|
|
294
|
|
|
—
|
|
|
—
|
|
|
294
|
|
|||||
Advances to/from subsidiaries
|
(114,977
|
)
|
|
—
|
|
|
—
|
|
|
114,977
|
|
|
—
|
|
|||||
Net cash (used in) provided by investing activities
|
(115,936
|
)
|
|
(4,270
|
)
|
|
—
|
|
|
114,977
|
|
|
(5,229
|
)
|
|||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Repayment of debt
|
(7,038
|
)
|
|
(350
|
)
|
|
—
|
|
|
—
|
|
|
(7,388
|
)
|
|||||
Debt issuance costs
|
(126
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(126
|
)
|
|||||
Advances to/from subsidiaries
|
—
|
|
|
124,171
|
|
|
4
|
|
|
(124,175
|
)
|
|
—
|
|
|||||
Other financing activities
|
(199
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(199
|
)
|
|||||
Net cash (used in) provided by financing activities
|
(7,363
|
)
|
|
123,821
|
|
|
4
|
|
|
(124,175
|
)
|
|
(7,713
|
)
|
|||||
Decrease in cash and cash equivalents
|
(154,140
|
)
|
|
(22,052
|
)
|
|
(84
|
)
|
|
(9,198
|
)
|
|
(185,474
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
301,980
|
|
|
22,034
|
|
|
1,614
|
|
|
(1,474
|
)
|
|
324,154
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
147,840
|
|
|
$
|
(18
|
)
|
|
$
|
1,530
|
|
|
$
|
(10,672
|
)
|
|
$
|
138,680
|
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
(In thousands)
|
2015
|
|
2014
|
||||
Total revenue
|
$
|
—
|
|
|
$
|
—
|
|
Home construction and land sales expenses
(a)
|
308
|
|
|
3,951
|
|
||
Gross loss
|
(308
|
)
|
|
(3,951
|
)
|
||
General and administrative expenses
|
2
|
|
|
304
|
|
||
Operating loss
|
(310
|
)
|
|
(4,255
|
)
|
||
Other income (expense), net
|
—
|
|
|
—
|
|
||
Loss from discontinued operations before income taxes
|
(310
|
)
|
|
(4,255
|
)
|
||
Benefit from income taxes
|
(110
|
)
|
|
(1
|
)
|
||
Loss from discontinued operations, net of tax
|
$
|
(200
|
)
|
|
$
|
(4,254
|
)
|
•
|
Sales per community per month was
1.8
and
2.1
for the quarters ended
December 31, 2015
and
December 31, 2014
, respectively. The first month of the current quarter was particularly slow, but we saw marked improvement in sales activity during the following two months. Sales per community per month was
2.7
for the trailing 12 months ended
December 31, 2015
versus
2.8
a year ago, and is still close to the range established in our “2B-10” plan of
2.8
to
3.0
. We continue to believe that we are currently among the industry leaders in sales absorption rates, and are focused on improving the sales pace in our expanding number of communities.
|
•
|
Our ASP for closings during the trailing 12 months ended
December 31, 2015
was
$318.1 thousand
, up
10.5%
year-over-year, and our ASP in backlog at
December 31, 2015
has risen
4.9%
versus the prior year to
$331.9 thousand
. Our targeted metric for ASP is currently a range of
$330.0 thousand
to
$340.0 thousand
, which we believe is achievable based on recent increases in our ASP on closed homes, our ASP on homes in backlog as of
December 31, 2015
and our current mix of communities available for sale.
|
•
|
During the current quarter, we had an average active community count of
169
, up
9.7%
over last year. In order to sustain our active community count, we invested another
$111.7 million
in land and land development during the current quarter, bringing our total spending for the trailing 12-month period to
$419.5 million
. We continue to strategically evaluate opportunities to purchase land within our geographic footprint, balancing our desire to reduce our leverage in the current fiscal year with land acquisition strategies that minimize our capital employed. Our “2B-10” target metric is a community count range between
170
to
175
, which we are approaching.
|
•
|
Homebuilding gross margin, excluding impairments, abandonments and interest for the trailing 12 months ended
December 31, 2015
was
21.4%
. Excluding the cumulative impact over the past 12 months of the Florida stucco issues, our margin for the trailing 12 months would have been 21.2%, which is consistent with prior year and is within our “2B-10” target metric range of between
21.0%
and
22.0%
. Our homebuilding gross margin is impacted by the increasing cost of land, driven by both market conditions and the structure of our land deals, and labor, as well as geographic and community mix.
|
•
|
SG&A for the trailing 12 months ended
December 31, 2015
was
12.3%
of total revenue, a decrease of
140
basis points from the prior year. Although it is above our “2B-10” target range of between
11.0%
and
12.0%
, we believe that as we grow revenue from our larger base of communities and higher ASPs, we will demonstrate improved SG&A cost leverage.
|
|
Three Months Ended
|
||||||
|
December 31,
|
||||||
($ in thousands)
|
2015
|
|
2014
|
||||
Revenues:
|
|
|
|
||||
Homebuilding
|
$
|
336,593
|
|
|
$
|
261,582
|
|
Land sales and other
|
7,856
|
|
|
4,182
|
|
||
Total
|
$
|
344,449
|
|
|
$
|
265,764
|
|
Gross profit (loss):
|
|
|
|
||||
Homebuilding
|
$
|
58,063
|
|
|
$
|
35,277
|
|
Land sales and other
|
(481
|
)
|
|
(59
|
)
|
||
Total
|
$
|
57,582
|
|
|
$
|
35,218
|
|
Gross margin:
|
|
|
|
||||
Homebuilding
(a)
|
17.3
|
%
|
|
13.5
|
%
|
||
Land sales and other
|
(6.1
|
)%
|
|
(1.4
|
)%
|
||
Total
|
16.7
|
%
|
|
13.3
|
%
|
||
Commissions
|
$
|
13,774
|
|
|
$
|
10,926
|
|
General and administrative expenses (G&A)
|
31,669
|
|
|
31,441
|
|
||
SG&A (commissions plus G&A) as a percentage of total revenue
|
13.2
|
%
|
|
15.9
|
%
|
||
G&A as a percentage of total revenue
|
9.2
|
%
|
|
11.8
|
%
|
||
Depreciation and amortization
|
$
|
2,991
|
|
|
$
|
2,341
|
|
Operating income (loss)
|
$
|
9,148
|
|
|
$
|
(9,490
|
)
|
Operating income (loss) as a percentage of total revenue
|
2.7
|
%
|
|
(3.6
|
)%
|
||
Effective Tax Rate
(b)
|
33.9
|
%
|
|
3.7
|
%
|
||
Equity in income of unconsolidated entities
|
$
|
60
|
|
|
$
|
142
|
|
Loss on extinguishment of debt
|
(828
|
)
|
|
—
|
|
|
|
Three Months Ended December 31,
|
|
LTM Ended December 31,
(a)
|
||||||||||||||||||||
|
|
2015
|
|
2014
|
|
15 v 14
|
|
2015
|
|
2014
|
|
15 v 14
|
||||||||||||
Net income (loss)
|
|
$
|
999
|
|
|
$
|
(22,340
|
)
|
|
$
|
23,339
|
|
|
$
|
367,433
|
|
|
$
|
17,181
|
|
|
$
|
350,252
|
|
Provision (benefit) from income taxes
|
|
506
|
|
|
(697
|
)
|
|
1,203
|
|
|
(324,724
|
)
|
|
(42,551
|
)
|
|
(282,173
|
)
|
||||||
Interest amortized to home construction and land sales expenses, capitalized interest impaired and interest expense not qualified for capitalization
|
|
21,083
|
|
|
18,034
|
|
|
3,049
|
|
|
89,035
|
|
|
86,716
|
|
|
2,319
|
|
||||||
Depreciation and amortization and stock compensation amortization
|
|
4,747
|
|
|
3,715
|
|
|
1,032
|
|
|
20,505
|
|
|
16,065
|
|
|
4,440
|
|
||||||
Inventory impairments and abandonments
|
|
1,356
|
|
|
—
|
|
|
1,356
|
|
|
4,465
|
|
|
8,031
|
|
|
(3,566
|
)
|
||||||
Loss on debt extinguishment
|
|
828
|
|
|
—
|
|
|
828
|
|
|
908
|
|
|
19,917
|
|
|
(19,009
|
)
|
||||||
Adjusted EBITDA
|
|
$
|
29,519
|
|
|
$
|
(1,288
|
)
|
|
$
|
30,807
|
|
|
$
|
157,622
|
|
|
$
|
105,359
|
|
|
$
|
52,263
|
|
Unexpected warranty costs related to Florida stucco issues (net of expected insurance recoveries)
|
|
(3,612
|
)
|
|
13,582
|
|
|
(17,194
|
)
|
|
(3,612
|
)
|
|
17,872
|
|
|
(21,484
|
)
|
||||||
Unexpected warranty costs related to water intrusion issues in New Jersey (net
of expected insurance recoveries)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
648
|
|
|
(648
|
)
|
||||||
Litigation settlement in discontinued operations
|
|
—
|
|
|
4,000
|
|
|
(4,000
|
)
|
|
(340
|
)
|
|
4,000
|
|
|
(4,340
|
)
|
||||||
Adjusted EBITDA excluding unexpected warranty costs and a litigation settlement in discontinued operations
|
|
$
|
25,907
|
|
|
$
|
16,294
|
|
|
$
|
9,613
|
|
|
$
|
153,670
|
|
|
$
|
127,879
|
|
|
$
|
25,791
|
|
|
Three Months Ended December 31,
|
|||||||||||||
|
New Orders, net
|
|
Cancellation Rates
|
|||||||||||
|
2015
|
|
2014
|
|
15 v 14
|
|
2015
|
|
2014
|
|||||
West
|
422
|
|
|
405
|
|
|
4.2
|
%
|
|
24.1
|
%
|
|
20.0
|
%
|
East
|
248
|
|
|
286
|
|
|
(13.3
|
)%
|
|
25.7
|
%
|
|
22.5
|
%
|
Southeast
|
253
|
|
|
275
|
|
|
(8.0
|
)%
|
|
28.5
|
%
|
|
22.3
|
%
|
Total
|
923
|
|
|
966
|
|
|
(4.5
|
)%
|
|
25.8
|
%
|
|
21.4
|
%
|
|
As of December 31,
|
|||||||||
|
2015
|
|
2014
|
|
15 v 14
|
|||||
Backlog Units:
|
|
|
|
|
|
|||||
West
|
885
|
|
|
646
|
|
|
37.0
|
%
|
||
East
|
478
|
|
|
581
|
|
|
(17.7
|
)%
|
||
Southeast
|
549
|
|
|
544
|
|
|
0.9
|
%
|
||
Total
|
1,912
|
|
|
1,771
|
|
|
8.0
|
%
|
||
Aggregate dollar value of homes in backlog (in millions)
|
$
|
634.6
|
|
|
$
|
560.5
|
|
|
13.2
|
%
|
ASP in backlog (in thousands)
|
$
|
331.9
|
|
|
$
|
316.5
|
|
|
4.9
|
%
|
|
Three Months Ended December 31,
|
|||||||||||||||||||||||||||||
|
Homebuilding Revenues
|
|
Average Selling Price
|
|
Closings
|
|||||||||||||||||||||||||
($ in thousands)
|
2015
|
|
2014
|
|
15 v 14
|
|
2015
|
|
2014
|
|
15 v 14
|
|
2015
|
|
2014
|
|
15 v 14
|
|||||||||||||
West
|
$
|
157,196
|
|
|
$
|
86,318
|
|
|
82.1
|
%
|
|
$
|
319.5
|
|
|
$
|
273.2
|
|
|
16.9
|
%
|
|
492
|
|
|
316
|
|
|
55.7
|
%
|
East
|
94,345
|
|
|
101,832
|
|
|
(7.4
|
)%
|
|
367.1
|
|
|
333.9
|
|
|
9.9
|
%
|
|
257
|
|
|
305
|
|
|
(15.7
|
)%
|
||||
Southeast
|
85,052
|
|
|
73,432
|
|
|
15.8
|
%
|
|
283.5
|
|
|
278.2
|
|
|
1.9
|
%
|
|
300
|
|
|
264
|
|
|
13.6
|
%
|
||||
Total
|
$
|
336,593
|
|
|
$
|
261,582
|
|
|
28.7
|
%
|
|
$
|
320.9
|
|
|
$
|
295.6
|
|
|
8.6
|
%
|
|
1,049
|
|
|
885
|
|
|
18.5
|
%
|
($ in thousands)
|
Three Months Ended December 31, 2015
|
|||||||||||||||||||||||||||
|
HB Gross
Profit (Loss)
|
|
HB Gross
Margin
|
|
Impairments &
Abandonments
(I&A)
|
|
HB Gross
Profit w/o
I&A
|
|
HB Gross
Margin w/o
I&A
|
|
Interest
Amortized to
COS
|
|
HB Gross Profit
w/o I&A and
Interest
|
|
HB Gross Margin
w/o I&A and
Interest
|
|||||||||||||
West
|
$
|
32,213
|
|
|
20.5
|
%
|
|
$
|
—
|
|
|
$
|
32,213
|
|
|
20.5
|
%
|
|
$
|
—
|
|
|
$
|
32,213
|
|
|
20.5
|
%
|
East
|
14,598
|
|
|
15.5
|
%
|
|
—
|
|
|
14,598
|
|
|
15.5
|
%
|
|
—
|
|
|
14,598
|
|
|
15.5
|
%
|
|||||
Southeast
|
19,649
|
|
|
23.1
|
%
|
|
788
|
|
|
20,437
|
|
|
24.0
|
%
|
|
—
|
|
|
20,437
|
|
|
24.0
|
%
|
|||||
Corporate & unallocated
|
(8,397
|
)
|
|
|
|
—
|
|
|
(8,397
|
)
|
|
|
|
13,367
|
|
|
4,970
|
|
|
|
||||||||
Total homebuilding
|
$
|
58,063
|
|
|
17.3
|
%
|
|
$
|
788
|
|
|
$
|
58,851
|
|
|
17.5
|
%
|
|
$
|
13,367
|
|
|
$
|
72,218
|
|
|
21.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
($ in thousands)
|
Three Months Ended December 31, 2014
|
|||||||||||||||||||||||||||
|
HB Gross
Profit (Loss)
|
|
HB Gross
Margin
|
|
Impairments &
Abandonments
(I&A)
|
|
HB Gross
Profit w/o
I&A
|
|
HB Gross
Margin w/o
I&A
|
|
Interest
Amortized to
COS
|
|
HB Gross Profit
w/o I&A and
Interest
|
|
HB Gross Margin
w/o I&A and
Interest
|
|||||||||||||
West
|
$
|
17,498
|
|
|
20.3
|
%
|
|
$
|
—
|
|
|
$
|
17,498
|
|
|
20.3
|
%
|
|
$
|
—
|
|
|
$
|
17,498
|
|
|
20.3
|
%
|
East
|
18,565
|
|
|
18.2
|
%
|
|
—
|
|
|
18,565
|
|
|
18.2
|
%
|
|
—
|
|
|
18,565
|
|
|
18.2
|
%
|
|||||
Southeast
|
2,080
|
|
|
2.8
|
%
|
|
—
|
|
|
2,080
|
|
|
2.8
|
%
|
|
—
|
|
|
2,080
|
|
|
2.8
|
%
|
|||||
Corporate & unallocated
|
(2,866
|
)
|
|
|
|
—
|
|
|
(2,866
|
)
|
|
|
|
8,194
|
|
|
5,328
|
|
|
|
||||||||
Total homebuilding
|
$
|
35,277
|
|
|
13.5
|
%
|
|
$
|
—
|
|
|
$
|
35,277
|
|
|
13.5
|
%
|
|
$
|
8,194
|
|
|
$
|
43,471
|
|
|
16.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land Sales and Other Revenues
|
|
Land Sales and Other Gross Profit (Loss)
|
||||||||||||||||||||
|
Three Months Ended December 31,
|
|
Three Months Ended December 31,
|
||||||||||||||||||||
(In thousands)
|
2015
|
|
2014
|
|
15 v 14
|
|
2015
|
|
2014
|
|
15 v 14
|
||||||||||||
West
|
$
|
—
|
|
|
$
|
1,147
|
|
|
$
|
(1,147
|
)
|
|
$
|
351
|
|
|
$
|
(10
|
)
|
|
$
|
361
|
|
East
|
6,212
|
|
|
2,981
|
|
|
3,231
|
|
|
(246
|
)
|
|
27
|
|
|
(273
|
)
|
||||||
Southeast
|
1,644
|
|
|
54
|
|
|
1,590
|
|
|
(214
|
)
|
|
49
|
|
|
(263
|
)
|
||||||
Corporate and unallocated
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
(372
|
)
|
|
(125
|
)
|
|
(247
|
)
|
||||||
Total
|
$
|
7,856
|
|
|
$
|
4,182
|
|
|
$
|
3,674
|
|
|
$
|
(481
|
)
|
|
$
|
(59
|
)
|
|
$
|
(422
|
)
|
(In thousands)
|
Three Months Ended December 31,
|
||||||||||
|
2015
|
|
2014
|
|
15 v 14
|
||||||
West
|
$
|
16,786
|
|
|
$
|
6,783
|
|
|
$
|
10,003
|
|
East
|
4,147
|
|
|
7,369
|
|
|
(3,222
|
)
|
|||
Southeast
|
10,657
|
|
|
(6,233
|
)
|
|
16,890
|
|
|||
Corporate and Unallocated
(a)
|
(22,442
|
)
|
|
(17,409
|
)
|
|
(5,033
|
)
|
|||
Operating income (loss)
|
$
|
9,148
|
|
|
$
|
(9,490
|
)
|
|
$
|
18,638
|
|
|
Three Months Ended December 31,
|
||||||
(in thousands)
|
2015
|
|
2014
|
||||
Cash used in operating activities
|
$
|
(77,849
|
)
|
|
$
|
(172,532
|
)
|
Cash used in investing activities
|
(1,313
|
)
|
|
(5,229
|
)
|
||
Cash used in financing activities
|
(27,540
|
)
|
|
(7,713
|
)
|
||
Net decrease in cash and cash equivalents
|
$
|
(106,702
|
)
|
|
$
|
(185,474
|
)
|
•
|
$144.9 million
in cash and cash equivalents;
|
•
|
$116.4 million
of remaining capacity under the Facility (due to the use of the Facility to secure
$28.6 million
in letters of credit); and
|
•
|
$39.4 million
of restricted cash,
$22.4 million
of which related to our cash secured loans.
|
10.1*
|
Form of 2014 Long-Term Incentive Plan Award Agreement for Performance Shares (Named Executive Officers).
|
|
|
31.1
|
Certification of Chief Executive Officer pursuant to 17 CFR 240.13a-14 promulgated under Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to 17 CFR 240.13a-14 promulgated under Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
101
|
The following financial statements from Beazer Homes USA, Inc.'s Quarterly Report on Form 10-Q for the period ended December 31, 2015, filed on February 4, 2016,
formatted in XBRL (Extensible Business Reporting Language): (i) Unaudited Consolidated Balance Sheets, (ii) Unaudited Consolidated Statements of Income, (iii) Unaudited Consolidated Statements of Cash Flows and (iv) Notes to Unaudited Consolidated Financial Statements.
|
Date:
|
February 4, 2016
|
Beazer Homes USA, Inc.
|
||
|
|
|
|
|
|
|
By:
|
|
/s/ Robert L. Salomon
|
|
|
|
Name:
|
Robert L. Salomon
|
|
|
|
|
Executive Vice President and
Chief Financial Officer
|
1.
|
AWARD OF PERFORMANCE SHARES
|
1.
|
RESTRICTIONS AND RIGHTS
|
2.
|
ADJUSTMENT OF SHARES
|
3.
|
MISCELLANEOUS
|
•
|
Three-year performance period beginning October 1, 2015 and ending on September 30, 2018.
|
•
|
Three Financial Metrics (defined terms follow):
|
◦
|
Cumulative Pre-Tax Income;
|
◦
|
Return on Assets (“ROA”) (improvement in the amount of Adjusted EBITDA as a percentage of Total Assets); and
|
◦
|
Improvement in the ratio of Net Debt to Adjusted EBITDA.
|
•
|
Total Shareholder Return (“TSR”) Modifier: After determination of shares earned based on performance on Financial Metrics, the result will be subject to increase or decrease by as much as 20% based on relative TSR performance against the S&P Homebuilders Select Industry Index.
|
•
|
Total Shares earned based on Financial Metrics cannot exceed 175% of Target Award, subject to adjustment by application of the TSR Modifier to a maximum 210% of Target Award.
|
|
|
Performance Required for Achievement at:
|
||||
Pre-Tax Income
|
|
Threshold
|
|
Target
|
|
Superior
|
3-Year CAGR (%)
|
|
33.3%
|
|
42.6%
|
|
51.4%
|
Total Increase by Fiscal Year 2018 ($)
|
|
$120 million
|
|
$140 million
|
|
$160 million
|
|
|
Performance Required for Achievement at:
|
||||
ROA
|
|
Threshold
|
|
Target
|
|
Superior
|
Fiscal Year 2018 (%)
|
|
8.00%
|
|
9.00%
|
|
10.00%
|
Improvement (basis points)
|
|
209 bps
|
|
309 bps
|
|
409 bps
|
|
|
Performance Required for Achievement at:
|
||||
Ratio of Net Debt/Adjusted EBITDA
|
|
Threshold
|
|
Target
|
|
Superior
|
Fiscal Year 2018
|
|
7.00x
|
|
6.00x
|
|
5.00x
|
Improvement by Fiscal Year 2018
|
|
(1.90)
|
|
(2.90)
|
|
(3.90)
|
TSR Percentile Rank vs.
S&P Homebuilders Select Industry Index
|
Adjustment to # of Performance Shares
|
At or above 75th Percentile
|
+20%
|
70-74th Percentile
|
+15%
|
65-69th Percentile
|
+10%
|
60-64th Percentile
|
+5%
|
40-59th Percentile
|
No adjustment
|
35-39th Percentile
|
-5%
|
30-34th Percentile
|
-10%
|
25-29th Percentile
|
-15%
|
Below 25
th
Percentile
|
-20%
|
•
|
Example: achievement of a Threshold level of performance on each of the three Financial Metrics will result in 33.3% of the Target Award earned per metric or a total of 100% of the Target Award, subject to adjustment based on the TSR Modifier to calculate the Vesting Percentage.
|
•
|
Superior level performance on any one Financial Metric (100%) will earn at least a Target Award subject to the TSR Modifier to calculate the Vesting Percentage.
|
•
|
The maximum number of shares that can be earned based on the results of the three Financial Metrics will be 175% of the Target Award even if Superior performance is achieved on all three Financial Metrics (300% of Target Award). In the event of Superior performance on all three Financial Metrics as well as on the TSR Modifier, the maximum Vesting Percentage will be 210% of the Target Award.
|
•
|
For performance between Threshold and Target or between Target and Superior, straight line interpolation between such levels will be applied.
|
•
|
Beginning and ending date prices for purposes of the TSR Modifier will be based on average closing price for the prior 20 days on the New York Stock Exchange, as applicable.
|
•
|
“Pre-Tax Income” is defined as the Company’s income from continuing operations for the applicable fiscal year, before taxes and excluding impairments and abandonments, bond losses and such other non-recurring items as the Committee may approve.
|
•
|
“Adjusted EBIT” (earnings before interest, debt extinguishment charges and taxes) equals net income (loss) before: (a) previously capitalized interest amortized to home construction and land sales expenses, capitalized interest impaired and interest expense not qualified for capitalization; (b) debt extinguishment charges; and (c) income taxes.
|
•
|
“Adjusted EBITDA” (earnings before interest, taxes, depreciation, amortization, debt extinguishment charges and impairments) is calculated by adding non-cash charges, including depreciation, amortization, inventory impairment and abandonment charges, goodwill impairments and joint venture impairment charges for the period to Adjusted EBIT.
|
•
|
“Total Assets” is defined as the Company’s total assets as shown on the consolidated balance sheet included in the Company’s Form 10-K for the applicable fiscal year.
|
•
|
“Net Debt” is defined as the Company’s total debt as shown on the consolidated balance sheet included in the Company’s Form 10-K for the applicable fiscal year less unrestricted cash.
|
•
|
“Vesting Percentage” shall mean the percentage of Target Award earned on the Financial Metrics and after adjustment by application of the TSR Modifier, subject to a maximum of 210% of Target Award.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Beazer Homes USA, 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 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 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 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.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Beazer Homes USA, 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 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 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 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.
|
Date:
|
February 4, 2016
|
|
|
|
|
|
|
/s/ Allan P. Merrill
|
|
|
Allan P. Merrill
|
|
|
President and Chief Executive Officer
|
Date:
|
February 4, 2016
|
|
|
|
|
|
|
/s/ Robert L. Salomon
|
|
|
Robert L. Salomon
|
|
|
Executive Vice President and Chief Financial Officer
|