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FORM 10-Q
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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Commission File Number 001-36283
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Delaware
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27-0560089
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(State or other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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Not Applicable
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(Former name, former address and former fiscal year, if changed since last report)
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Large accelerated filer
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¨
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Non-accelerated filer (Do not check if smaller reporting company)
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¨
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Accelerated filer
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ý
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Smaller reporting company
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¨
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Emerging growth company
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ý
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Page
Number
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PART I Financial Information
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Part II Other Information
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Item 1.
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||
Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 1.
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Financial Statements
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June 30,
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December 31,
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||||
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2017
|
|
2016
|
||||
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(Unaudited)
|
|
|
||||
Assets
|
|
|
|
||||
Cash and cash equivalents
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$
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153,959
|
|
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$
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30,496
|
|
Restricted cash
|
88
|
|
|
585
|
|
||
Contracts and accounts receivable
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18,321
|
|
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27,833
|
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||
Due from affiliates
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2,062
|
|
|
1,138
|
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||
Real estate inventories
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365,400
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|
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286,928
|
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||
Investment in and advances to unconsolidated joint ventures
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55,864
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50,857
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Other assets
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23,916
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21,299
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Total assets
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$
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619,610
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$
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419,136
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||||
Liabilities and equity
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|
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||||
Accounts payable
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$
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34,215
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$
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33,094
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Accrued expenses and other liabilities
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19,473
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|
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23,418
|
|
||
Unsecured revolving credit facility
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—
|
|
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118,000
|
|
||
Senior notes, net
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318,121
|
|
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—
|
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||
Total liabilities
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371,809
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174,512
|
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||
Commitments and contingencies (Note 10)
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|
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||||
Equity:
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||||
Stockholders' equity:
|
|
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||||
Preferred stock, $0.01 par value, 50,000,000 shares authorized, no shares outstanding
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—
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—
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|
||
Common stock, $0.01 par value, 500,000,000 shares authorized, 20,875,666 and 20,712,166, shares issued and outstanding as of June 30, 2017 and December 31, 2016, respectively
|
209
|
|
|
207
|
|
||
Additional paid-in capital
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197,983
|
|
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197,161
|
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||
Retained earnings
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49,518
|
|
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47,155
|
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||
Total stockholders' equity
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247,710
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|
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244,523
|
|
||
Noncontrolling interest in subsidiary
|
91
|
|
|
101
|
|
||
Total equity
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247,801
|
|
|
244,624
|
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||
Total liabilities and equity
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$
|
619,610
|
|
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$
|
419,136
|
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Three Months Ended June 30,
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Six Months Ended June 30,
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||||||||||||
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2017
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2016
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2017
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2016
|
||||||||
Revenues:
|
|
|
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|
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|
||||||||
Home sales
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$
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96,929
|
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$
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78,836
|
|
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$
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166,335
|
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$
|
121,139
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Fee building, including management fees from unconsolidated joint ventures of $1,217, $2,537, $2,431 and $4,712, respectively
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47,181
|
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30,028
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102,798
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|
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72,965
|
|
||||
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144,110
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108,864
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269,133
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194,104
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||||
Cost of Sales:
|
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||||||||
Home sales
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82,488
|
|
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69,390
|
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142,553
|
|
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106,060
|
|
||||
Home sales impairments
|
1,300
|
|
|
—
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|
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1,300
|
|
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—
|
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||||
Fee building
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45,899
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28,317
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99,825
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69,231
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||||
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129,687
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97,707
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243,678
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175,291
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||||||||
Gross Margin:
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||||||||
Home sales
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13,141
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9,446
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22,482
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15,079
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||||
Fee building
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1,282
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1,711
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2,973
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3,734
|
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||||
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14,423
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11,157
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25,455
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18,813
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||||
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||||||||
Selling and marketing expenses
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(6,376
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)
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(5,046
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)
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(11,377
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)
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(8,522
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)
|
||||
General and administrative expenses
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(5,595
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)
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(5,833
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)
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(10,685
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)
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(11,008
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)
|
||||
Equity in net income of unconsolidated joint ventures
|
201
|
|
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3,947
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|
507
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|
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3,940
|
|
||||
Other income (expense), net
|
(148
|
)
|
|
(286
|
)
|
|
(35
|
)
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(395
|
)
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||||
Income before income taxes
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2,505
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|
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3,939
|
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3,865
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2,828
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|
||||
Provision for income taxes
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(988
|
)
|
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(1,495
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)
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(1,512
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)
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(1,253
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)
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||||
Net income
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1,517
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2,444
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2,353
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1,575
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|
||||
Net loss attributable to noncontrolling interest
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—
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65
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|
|
10
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|
|
120
|
|
||||
Net income attributable to The New Home Company Inc.
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$
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1,517
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$
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2,509
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$
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2,363
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$
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1,695
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||||||||
Earnings per share attributable to The New Home Company Inc.:
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||||||||
Basic
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$
|
0.07
|
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$
|
0.12
|
|
|
$
|
0.11
|
|
|
$
|
0.08
|
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Diluted
|
$
|
0.07
|
|
|
$
|
0.12
|
|
|
$
|
0.11
|
|
|
$
|
0.08
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic
|
20,869,429
|
|
|
20,709,139
|
|
|
20,819,288
|
|
|
20,654,998
|
|
||||
Diluted
|
20,956,723
|
|
|
20,760,186
|
|
|
20,921,150
|
|
|
20,745,802
|
|
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Stockholders’ Equity
|
|
Noncontrolling Interest in Subsidiary
|
|
Total Equity
|
|||||||||||||||||||||
|
Number of Shares of
Common
Stock
|
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Retained Earnings
|
|
Total
Stockholders’
Equity
|
|
|
|||||||||||||||
Balance at December 31, 2015
|
20,543,130
|
|
|
$
|
205
|
|
|
$
|
194,437
|
|
|
$
|
26,133
|
|
|
$
|
220,775
|
|
|
$
|
922
|
|
|
$
|
221,697
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
1,695
|
|
|
1,695
|
|
|
(120
|
)
|
|
1,575
|
|
||||||
Noncontrolling interest distribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(725
|
)
|
|
(725
|
)
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,742
|
|
|
—
|
|
|
1,742
|
|
|
—
|
|
|
1,742
|
|
||||||
Shares net settled with the Company to satisfy minimum employee personal income tax liabilities resulting from share based compensation plans
|
—
|
|
|
—
|
|
|
(647
|
)
|
|
—
|
|
|
(647
|
)
|
|
—
|
|
|
(647
|
)
|
||||||
Excess tax provision from stock-based compensation
|
—
|
|
|
—
|
|
|
(97
|
)
|
|
—
|
|
|
(97
|
)
|
|
—
|
|
|
(97
|
)
|
||||||
Shares issued through stock plans
|
168,822
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at June 30, 2016
|
20,711,952
|
|
|
$
|
207
|
|
|
$
|
195,433
|
|
|
$
|
27,828
|
|
|
$
|
223,468
|
|
|
$
|
77
|
|
|
$
|
223,545
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at December 31, 2016
|
20,712,166
|
|
|
$
|
207
|
|
|
$
|
197,161
|
|
|
$
|
47,155
|
|
|
$
|
244,523
|
|
|
$
|
101
|
|
|
$
|
244,624
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
2,363
|
|
|
2,363
|
|
|
(10
|
)
|
|
2,353
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,306
|
|
|
—
|
|
|
1,306
|
|
|
—
|
|
|
1,306
|
|
||||||
Shares net settled with the Company to satisfy minimum employee personal income tax liabilities resulting from share based compensation plans
|
—
|
|
|
—
|
|
|
(584
|
)
|
|
—
|
|
|
(584
|
)
|
|
—
|
|
|
(584
|
)
|
||||||
Shares issued through stock plans
|
163,500
|
|
|
2
|
|
|
100
|
|
|
—
|
|
|
102
|
|
|
—
|
|
|
102
|
|
||||||
Balance at June 30, 2017
|
20,875,666
|
|
|
$
|
209
|
|
|
$
|
197,983
|
|
|
$
|
49,518
|
|
|
$
|
247,710
|
|
|
$
|
91
|
|
|
$
|
247,801
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
Operating activities:
|
|
|
|
||||
Net income
|
$
|
2,353
|
|
|
$
|
1,575
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
||||
Deferred taxes
|
(54
|
)
|
|
(27
|
)
|
||
Amortization of equity based compensation
|
1,306
|
|
|
1,742
|
|
||
Excess income tax provision from stock-based compensation
|
—
|
|
|
97
|
|
||
Distributions of earnings from unconsolidated joint ventures
|
1,588
|
|
|
1,095
|
|
||
Inventory impairments
|
1,300
|
|
|
—
|
|
||
Equity in net income of unconsolidated joint ventures
|
(507
|
)
|
|
(3,940
|
)
|
||
Deferred profit from unconsolidated joint ventures
|
497
|
|
|
332
|
|
||
Depreciation
|
236
|
|
|
251
|
|
||
Abandoned project costs
|
206
|
|
|
329
|
|
||
Net changes in operating assets and liabilities:
|
|
|
|
||||
Restricted cash
|
497
|
|
|
104
|
|
||
Contracts and accounts receivable
|
9,573
|
|
|
9,164
|
|
||
Due from affiliates
|
(671
|
)
|
|
88
|
|
||
Real estate inventories
|
(74,407
|
)
|
|
(164,464
|
)
|
||
Other assets
|
(2,900
|
)
|
|
(5,832
|
)
|
||
Accounts payable
|
1,160
|
|
|
3,737
|
|
||
Accrued expenses and other liabilities
|
(11,588
|
)
|
|
(9,711
|
)
|
||
Due to affiliates
|
—
|
|
|
(239
|
)
|
||
Net cash used in operating activities
|
(71,411
|
)
|
|
(165,699
|
)
|
||
Investing activities:
|
|
|
|
||||
Purchases of property and equipment
|
(95
|
)
|
|
(296
|
)
|
||
Cash assumed from joint venture at consolidation
|
995
|
|
|
2,009
|
|
||
Contributions and advances to unconsolidated joint ventures
|
(8,517
|
)
|
|
(5,656
|
)
|
||
Distributions of capital from unconsolidated joint ventures
|
2,948
|
|
|
7,405
|
|
||
Net cash provided by (used in) investing activities
|
(4,669
|
)
|
|
3,462
|
|
||
Financing activities:
|
|
|
|
||||
Borrowings from credit facility
|
72,000
|
|
|
175,000
|
|
||
Repayments of credit facility
|
(190,000
|
)
|
|
(11,000
|
)
|
||
Proceeds from senior notes
|
324,465
|
|
|
—
|
|
||
Borrowings from other notes payable
|
—
|
|
|
343
|
|
||
Repayments of other notes payable
|
—
|
|
|
(15,636
|
)
|
||
Payment of debt issuance costs
|
(6,440
|
)
|
|
(1,064
|
)
|
||
Cash distributions to noncontrolling interest in subsidiary
|
—
|
|
|
(725
|
)
|
||
Minimum tax withholding paid on behalf of employees for stock awards
|
(584
|
)
|
|
(647
|
)
|
||
Excess income tax provision from stock-based compensation
|
—
|
|
|
(97
|
)
|
||
Proceeds from exercise of stock options
|
102
|
|
|
—
|
|
||
Net cash provided by financing activities
|
199,543
|
|
|
146,174
|
|
||
Net increase (decrease) in cash and cash equivalents
|
123,463
|
|
|
(16,063
|
)
|
||
Cash and cash equivalents – beginning of period
|
30,496
|
|
|
45,874
|
|
||
Cash and cash equivalents – end of period
|
$
|
153,959
|
|
|
$
|
29,811
|
|
•
|
Participating rights - provide the noncontrolling equity holders the ability to direct significant financial and operational decision made in the ordinary course of business that most significantly influence the entity's economic performance.
|
•
|
Kick-out rights - allow the noncontrolling equity holders to remove the general partner or managing member without cause.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands, except share and per share amounts)
|
||||||||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income attributable to The New Home Company Inc.
|
$
|
1,517
|
|
|
$
|
2,509
|
|
|
$
|
2,363
|
|
|
$
|
1,695
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Basic weighted-average shares outstanding
|
20,869,429
|
|
|
20,709,139
|
|
|
20,819,288
|
|
|
20,654,998
|
|
||||
Effect of dilutive shares:
|
|
|
|
|
|
|
|
||||||||
Stock options and unvested restricted stock units
|
87,294
|
|
|
51,047
|
|
|
101,862
|
|
|
90,804
|
|
||||
Diluted weighted-average shares outstanding
|
20,956,723
|
|
|
20,760,186
|
|
|
20,921,150
|
|
|
20,745,802
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share attributable to The New Home Company Inc.
|
$
|
0.07
|
|
|
$
|
0.12
|
|
|
$
|
0.11
|
|
|
$
|
0.08
|
|
Diluted earnings per share attributable to The New Home Company Inc.
|
$
|
0.07
|
|
|
$
|
0.12
|
|
|
$
|
0.11
|
|
|
$
|
0.08
|
|
|
|
|
|
|
|
|
|
||||||||
Antidilutive stock options and unvested restricted stock units not included in diluted earnings (loss) per share
|
22,077
|
|
|
888,953
|
|
|
846,725
|
|
|
867,272
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Contracts receivable:
|
|
|
|
||||
Costs incurred on fee building projects
|
$
|
99,825
|
|
|
$
|
178,103
|
|
Estimated earnings
|
2,973
|
|
|
8,404
|
|
||
|
102,798
|
|
|
186,507
|
|
||
Less: amounts collected during the period
|
(89,321
|
)
|
|
(162,203
|
)
|
||
Contracts receivable
|
$
|
13,477
|
|
|
$
|
24,304
|
|
|
|
|
|
||||
Contracts receivable:
|
|
|
|
||||
Billed
|
$
|
—
|
|
|
$
|
—
|
|
Unbilled
|
13,477
|
|
|
24,304
|
|
||
|
13,477
|
|
|
24,304
|
|
||
Accounts receivable:
|
|
|
|
||||
Escrow receivables
|
4,721
|
|
|
3,385
|
|
||
Other receivables
|
123
|
|
|
144
|
|
||
Contracts and accounts receivable
|
$
|
18,321
|
|
|
$
|
27,833
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Deposits and pre-acquisition costs
|
$
|
45,480
|
|
|
$
|
38,723
|
|
Land held and land under development
|
107,998
|
|
|
98,596
|
|
||
Homes completed or under construction
|
179,885
|
|
|
93,628
|
|
||
Model homes
|
32,037
|
|
|
55,981
|
|
||
|
$
|
365,400
|
|
|
$
|
286,928
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in Thousands)
|
||||||||||||||
Inventory impairments:
|
|
|
|
|
|
|
|
||||||||
Home sales
|
$
|
1,300
|
|
|
$
|
—
|
|
|
$
|
1,300
|
|
|
$
|
—
|
|
Total inventory impairments
|
$
|
1,300
|
|
|
$
|
—
|
|
|
$
|
1,300
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Remaining carrying value of inventory impaired at period end
|
$
|
12,550
|
|
|
$
|
—
|
|
|
$
|
12,550
|
|
|
$
|
—
|
|
Number of projects impaired during the period
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Total number of projects subject to periodic impairment review during the year
(1)
|
25
|
|
|
23
|
|
|
26
|
|
|
23
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Interest incurred
|
$
|
6,401
|
|
|
$
|
1,689
|
|
|
$
|
8,437
|
|
|
$
|
2,970
|
|
Interest capitalized to inventory
|
(5,878
|
)
|
|
(1,689
|
)
|
|
(7,750
|
)
|
|
(2,970
|
)
|
||||
Interest capitalized to investments in unconsolidated joint ventures
|
(523
|
)
|
|
—
|
|
|
(687
|
)
|
|
—
|
|
||||
Interest expensed
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Capitalized interest in beginning inventory
|
$
|
6,663
|
|
|
$
|
4,823
|
|
|
$
|
6,342
|
|
|
$
|
4,190
|
|
Interest capitalized as a cost of inventory
|
5,878
|
|
|
1,689
|
|
|
7,750
|
|
|
2,970
|
|
||||
Previously capitalized interest included in cost of sales
|
(1,720
|
)
|
|
(1,063
|
)
|
|
(3,271
|
)
|
|
(1,711
|
)
|
||||
Capitalized interest in ending inventory
|
$
|
10,821
|
|
|
$
|
5,449
|
|
|
10,821
|
|
|
5,449
|
|
||
|
|
|
|
|
|
|
|
||||||||
Capitalized interest in beginning investment in unconsolidated joint ventures
|
164
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Interest capitalized to investments in unconsolidated joint ventures
|
523
|
|
|
—
|
|
|
687
|
|
|
—
|
|
||||
Previously capitalized interest included in equity in net income of unconsolidated joint ventures
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Capitalized interest in ending investments in unconsolidated joint ventures
|
687
|
|
|
—
|
|
|
687
|
|
|
—
|
|
||||
Total capitalized interest in ending inventory and investments in unconsolidated joint ventures
|
$
|
11,508
|
|
|
$
|
5,449
|
|
|
$
|
11,508
|
|
|
$
|
5,449
|
|
|
|
|
|
|
|
|
|
||||||||
Capitalized interest as a percentage of inventory
|
3.0
|
%
|
|
1.4
|
%
|
|
3.0
|
%
|
|
1.4
|
%
|
||||
Interest included in cost of sales as a percentage of home sales revenue
|
1.8
|
%
|
|
1.3
|
%
|
|
2.0
|
%
|
|
1.4
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Capitalized interest as a percentage of investments in and advances to unconsolidated joint ventures
|
1.2
|
%
|
|
—
|
%
|
|
1.2
|
%
|
|
—
|
%
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Cash and cash equivalents
|
$
|
31,304
|
|
|
$
|
33,683
|
|
Restricted cash
|
16,176
|
|
|
8,374
|
|
||
Real estate inventories
|
407,239
|
|
|
386,487
|
|
||
Other assets
|
1,922
|
|
|
1,664
|
|
||
Total assets
|
$
|
456,641
|
|
|
$
|
430,208
|
|
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
28,109
|
|
|
$
|
28,706
|
|
Notes payable
|
106,111
|
|
|
97,664
|
|
||
Total liabilities
|
134,220
|
|
|
126,370
|
|
||
The New Home Company's equity
|
49,226
|
|
|
46,857
|
|
||
Other partners' equity
|
273,195
|
|
|
256,981
|
|
||
Total equity
|
322,421
|
|
|
303,838
|
|
||
Total liabilities and equity
|
$
|
456,641
|
|
|
$
|
430,208
|
|
Debt-to-capitalization ratio
|
24.8
|
%
|
|
24.3
|
%
|
||
Debt-to-equity ratio
|
32.9
|
%
|
|
32.1
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Revenues
|
$
|
35,171
|
|
|
$
|
70,104
|
|
|
$
|
61,791
|
|
|
$
|
112,061
|
|
Cost of sales and expenses
|
35,825
|
|
|
59,909
|
|
|
63,309
|
|
|
99,725
|
|
||||
Net (loss) income of unconsolidated joint ventures
|
$
|
(654
|
)
|
|
$
|
10,195
|
|
|
$
|
(1,518
|
)
|
|
$
|
12,336
|
|
Equity in net income of unconsolidated joint ventures reflected in the accompanying consolidated statements of operations
|
$
|
201
|
|
|
$
|
3,947
|
|
|
$
|
507
|
|
|
$
|
3,940
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Capitalized selling and marketing costs
(1)
|
$
|
11,878
|
|
|
$
|
10,101
|
|
Deferred tax asset, net
|
8,488
|
|
|
8,434
|
|
||
Property and equipment, net of accumulated depreciation
|
716
|
|
|
857
|
|
||
Prepaid expenses
|
2,834
|
|
|
1,907
|
|
||
|
$
|
23,916
|
|
|
$
|
21,299
|
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Warranty accrual
|
$
|
5,399
|
|
|
$
|
4,931
|
|
Accrued compensation and benefits
|
3,181
|
|
|
6,786
|
|
||
Accrued interest
|
6,872
|
|
|
648
|
|
||
Completion reserve
|
1,471
|
|
|
1,355
|
|
||
Income taxes payable
|
—
|
|
|
7,147
|
|
||
Deferred profit from unconsolidated joint ventures
|
460
|
|
|
957
|
|
||
Other accrued expenses
|
2,090
|
|
|
1,594
|
|
||
|
$
|
19,473
|
|
|
$
|
23,418
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Beginning warranty accrual for homebuilding projects
|
$
|
4,678
|
|
|
$
|
4,057
|
|
|
$
|
4,608
|
|
|
$
|
3,846
|
|
Warranty provision for homebuilding projects
|
331
|
|
|
493
|
|
|
602
|
|
|
805
|
|
||||
Warranty assumed from joint venture at consolidation
|
358
|
|
|
469
|
|
|
358
|
|
|
469
|
|
||||
Warranty payments for homebuilding projects
|
(291
|
)
|
|
(145
|
)
|
|
(492
|
)
|
|
(246
|
)
|
||||
Ending warranty accrual for homebuilding projects
|
5,076
|
|
|
4,874
|
|
|
5,076
|
|
|
4,874
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Beginning warranty accrual for fee building projects
|
323
|
|
|
332
|
|
|
323
|
|
|
335
|
|
||||
Warranty provision for fee building projects
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Warranty efforts for fee building projects
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(4
|
)
|
||||
Ending warranty accrual for fee building projects
|
323
|
|
|
331
|
|
|
323
|
|
|
331
|
|
||||
Total ending warranty accrual
|
$
|
5,399
|
|
|
$
|
5,205
|
|
|
$
|
5,399
|
|
|
$
|
5,205
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
7.25% Senior Notes due 2022, net
|
$
|
318,121
|
|
|
$
|
—
|
|
Senior unsecured revolving credit facility
|
—
|
|
|
118,000
|
|
||
Total Notes Payable
|
$
|
318,121
|
|
|
$
|
118,000
|
|
•
|
Level 1 – Quoted prices for identical instruments in active markets
|
•
|
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are inactive; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets at measurement date
|
•
|
Level 3 – Valuations derived from techniques where one or more significant inputs or significant value drivers are unobservable in active markets at measurement date
|
|
June 30, 2017
|
|
December 31, 2016
|
||||||||||||
|
Carrying Amount
|
|
Fair Value
|
|
Carrying Amount
|
|
Fair Value
|
||||||||
|
(dollars in thousands)
|
||||||||||||||
7.25% Senior Notes due 2022, net
(1)
|
$
|
318,121
|
|
|
$
|
334,750
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
||||||||||
|
Number of Shares
|
|
Weighted-Average Exercise Price per Share
|
|
Number of Shares
|
|
Weighted-Average Exercise Price per Share
|
||||||
Stock Option Activity
|
|
|
|
|
|
|
|
||||||
Outstanding, beginning of period
|
835,786
|
|
|
$
|
11.00
|
|
|
840,298
|
|
|
$
|
11.00
|
|
Granted
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Exercised
|
(9,288
|
)
|
|
$
|
11.00
|
|
|
—
|
|
|
$
|
—
|
|
Forfeited
|
—
|
|
|
$
|
—
|
|
|
(4,512
|
)
|
|
$
|
11.00
|
|
Outstanding, end of period
|
826,498
|
|
|
$
|
11.00
|
|
|
835,786
|
|
|
$
|
11.00
|
|
Exercisable, end of period
|
826,498
|
|
|
$
|
11.00
|
|
|
44,442
|
|
|
$
|
11.00
|
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
||||||||||
|
Number of Shares
|
|
Weighted-Average Grant-Date Fair Value per Share
|
|
Number of Shares
|
|
Weighted-Average Grant-Date Fair Value per Share
|
||||||
Restricted Stock Unit Activity
|
|
|
|
|
|
|
|
||||||
Outstanding, beginning of period
|
474,989
|
|
|
$
|
10.66
|
|
|
308,386
|
|
|
$
|
14.20
|
|
Granted
|
343,933
|
|
|
$
|
10.84
|
|
|
409,509
|
|
|
$
|
10.05
|
|
Vested
|
(209,619
|
)
|
|
$
|
10.76
|
|
|
(231,289
|
)
|
|
$
|
14.22
|
|
Forfeited
|
(26,194
|
)
|
|
$
|
10.82
|
|
|
(3,980
|
)
|
|
$
|
13.68
|
|
Outstanding, end of period
|
583,109
|
|
|
$
|
10.72
|
|
|
482,626
|
|
|
$
|
10.67
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Expense related to:
|
|
|
|
|
|
|
|
||||||||
Stock options
|
$
|
—
|
|
|
$
|
185
|
|
|
$
|
11
|
|
|
$
|
447
|
|
Restricted stock units
|
695
|
|
|
572
|
|
|
1,295
|
|
|
1,295
|
|
||||
|
$
|
695
|
|
|
$
|
757
|
|
|
$
|
1,306
|
|
|
$
|
1,742
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Homebuilding
|
$
|
96,929
|
|
|
$
|
78,836
|
|
|
$
|
166,335
|
|
|
$
|
121,139
|
|
Fee building, including management fees
|
47,181
|
|
|
30,028
|
|
|
102,798
|
|
|
72,965
|
|
||||
Total
|
$
|
144,110
|
|
|
$
|
108,864
|
|
|
$
|
269,133
|
|
|
$
|
194,104
|
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income taxes:
|
|
|
|
|
|
|
|
||||||||
Homebuilding
|
$
|
1,223
|
|
|
$
|
2,228
|
|
|
$
|
892
|
|
|
$
|
(906
|
)
|
Fee building, including management fees
|
1,282
|
|
|
1,711
|
|
|
2,973
|
|
|
3,734
|
|
||||
Total
|
$
|
2,505
|
|
|
$
|
3,939
|
|
|
$
|
3,865
|
|
|
$
|
2,828
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Assets:
|
|
|
|
||||
Homebuilding
|
$
|
605,358
|
|
|
$
|
393,095
|
|
Fee building
|
14,252
|
|
|
26,041
|
|
||
Total
|
$
|
619,610
|
|
|
$
|
419,136
|
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Supplemental disclosures of cash flow information
|
|
|
|
||||
Interest paid, net of amounts capitalized
|
$
|
—
|
|
|
$
|
—
|
|
Income taxes paid
|
$
|
8,750
|
|
|
$
|
8,150
|
|
Supplemental disclosures of non-cash transactions
|
|
|
|
||||
Assets assumed from unconsolidated joint ventures
|
$
|
100
|
|
|
$
|
46,811
|
|
Liabilities and equity assumed from unconsolidated joint ventures
|
$
|
1,095
|
|
|
$
|
47,197
|
|
Contribution of real estate to unconsolidated joint ventures
|
$
|
1,013
|
|
|
$
|
—
|
|
|
June 30, 2017
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
120,557
|
|
|
$
|
33,180
|
|
|
$
|
222
|
|
|
$
|
—
|
|
|
$
|
153,959
|
|
Restricted cash
|
—
|
|
|
88
|
|
|
—
|
|
|
—
|
|
|
88
|
|
|||||
Contracts and accounts receivable
|
14
|
|
|
19,667
|
|
|
7
|
|
|
(1,367
|
)
|
|
18,321
|
|
|||||
Intercompany receivables
|
91,737
|
|
|
—
|
|
|
—
|
|
|
(91,737
|
)
|
|
—
|
|
|||||
Due from affiliates
|
—
|
|
|
2,062
|
|
|
—
|
|
|
—
|
|
|
2,062
|
|
|||||
Real estate inventories
|
—
|
|
|
365,400
|
|
|
—
|
|
|
—
|
|
|
365,400
|
|
|||||
Investment in and advances to unconsolidated joint ventures
|
—
|
|
|
55,864
|
|
|
—
|
|
|
—
|
|
|
55,864
|
|
|||||
Investment in subsidiaries
|
345,376
|
|
|
—
|
|
|
—
|
|
|
(345,376
|
)
|
|
—
|
|
|||||
Other assets
|
15,836
|
|
|
8,080
|
|
|
—
|
|
|
—
|
|
|
23,916
|
|
|||||
Total assets
|
$
|
573,520
|
|
|
$
|
484,341
|
|
|
$
|
229
|
|
|
$
|
(438,480
|
)
|
|
$
|
619,610
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
110
|
|
|
$
|
34,105
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
34,215
|
|
Accrued expenses and other liabilities
|
7,579
|
|
|
13,126
|
|
|
126
|
|
|
(1,358
|
)
|
|
19,473
|
|
|||||
Intercompany payables
|
—
|
|
|
91,737
|
|
|
—
|
|
|
(91,737
|
)
|
|
—
|
|
|||||
Due to affiliates
|
—
|
|
|
9
|
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|||||
Senior notes, net
|
318,121
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
318,121
|
|
|||||
Total liabilities
|
325,810
|
|
|
138,977
|
|
|
126
|
|
|
(93,104
|
)
|
|
371,809
|
|
|||||
Stockholders' equity
|
247,710
|
|
|
345,364
|
|
|
12
|
|
|
(345,376
|
)
|
|
247,710
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
91
|
|
|
—
|
|
|
91
|
|
|||||
Total equity
|
247,710
|
|
|
345,364
|
|
|
103
|
|
|
(345,376
|
)
|
|
247,801
|
|
|||||
Total liabilities and equity
|
$
|
573,520
|
|
|
$
|
484,341
|
|
|
$
|
229
|
|
|
$
|
(438,480
|
)
|
|
$
|
619,610
|
|
|
December 31, 2016
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
16,385
|
|
|
$
|
13,842
|
|
|
$
|
269
|
|
|
$
|
—
|
|
|
$
|
30,496
|
|
Restricted cash
|
—
|
|
|
585
|
|
|
—
|
|
|
—
|
|
|
585
|
|
|||||
Contracts and accounts receivable
|
30
|
|
|
29,774
|
|
|
—
|
|
|
(1,971
|
)
|
|
27,833
|
|
|||||
Intercompany receivables
|
73,972
|
|
|
—
|
|
|
—
|
|
|
(73,972
|
)
|
|
—
|
|
|||||
Due from affiliates
|
—
|
|
|
1,138
|
|
|
—
|
|
|
—
|
|
|
1,138
|
|
|||||
Real estate inventories
|
—
|
|
|
286,928
|
|
|
—
|
|
|
—
|
|
|
286,928
|
|
|||||
Investment in and advances to unconsolidated joint ventures
|
—
|
|
|
50,857
|
|
|
—
|
|
|
—
|
|
|
50,857
|
|
|||||
Investment in subsidiaries
|
268,411
|
|
|
—
|
|
|
—
|
|
|
(268,411
|
)
|
|
—
|
|
|||||
Other assets
|
9,381
|
|
|
11,918
|
|
|
—
|
|
|
—
|
|
|
21,299
|
|
|||||
Total assets
|
$
|
368,179
|
|
|
$
|
395,042
|
|
|
$
|
269
|
|
|
$
|
(344,354
|
)
|
|
$
|
419,136
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
$
|
167
|
|
|
$
|
32,900
|
|
|
$
|
27
|
|
|
$
|
—
|
|
|
$
|
33,094
|
|
Accrued expenses and other liabilities
|
5,489
|
|
|
19,763
|
|
|
108
|
|
|
(1,942
|
)
|
|
23,418
|
|
|||||
Intercompany payables
|
—
|
|
|
73,972
|
|
|
—
|
|
|
(73,972
|
)
|
|
—
|
|
|||||
Due to affiliates
|
—
|
|
|
29
|
|
|
—
|
|
|
(29
|
)
|
|
—
|
|
|||||
Unsecured revolving credit facility
|
118,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
118,000
|
|
|||||
Total liabilities
|
123,656
|
|
|
126,664
|
|
|
135
|
|
|
(75,943
|
)
|
|
174,512
|
|
|||||
Stockholders' equity
|
244,523
|
|
|
268,378
|
|
|
33
|
|
|
(268,411
|
)
|
|
244,523
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||
Total equity
|
244,523
|
|
|
268,378
|
|
|
$
|
134
|
|
|
(268,411
|
)
|
|
244,624
|
|
||||
Total liabilities and equity
|
$
|
368,179
|
|
|
$
|
395,042
|
|
|
$
|
269
|
|
|
$
|
(344,354
|
)
|
|
$
|
419,136
|
|
|
Three Months Ended June 30, 2017
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
$
|
—
|
|
|
$
|
96,929
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
96,929
|
|
Fee Building
|
—
|
|
|
47,181
|
|
|
—
|
|
|
—
|
|
|
47,181
|
|
|||||
|
—
|
|
|
144,110
|
|
|
—
|
|
|
—
|
|
|
144,110
|
|
|||||
Cost of Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
82,488
|
|
|
—
|
|
|
—
|
|
|
82,488
|
|
|||||
Home sales impairment
|
—
|
|
|
1,300
|
|
|
—
|
|
|
—
|
|
|
1,300
|
|
|||||
Fee building
|
595
|
|
|
45,304
|
|
|
—
|
|
|
—
|
|
|
45,899
|
|
|||||
|
595
|
|
|
129,092
|
|
|
—
|
|
|
—
|
|
|
129,687
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross Margin:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
13,141
|
|
|
—
|
|
|
—
|
|
|
13,141
|
|
|||||
Fee building
|
(595
|
)
|
|
1,877
|
|
|
—
|
|
|
—
|
|
|
1,282
|
|
|||||
|
(595
|
)
|
|
15,018
|
|
|
—
|
|
|
—
|
|
|
14,423
|
|
|||||
Selling and marketing expenses
|
—
|
|
|
(6,376
|
)
|
|
—
|
|
|
—
|
|
|
(6,376
|
)
|
|||||
General and administrative expenses
|
(375
|
)
|
|
(5,220
|
)
|
|
—
|
|
|
—
|
|
|
(5,595
|
)
|
|||||
Equity in net income of unconsolidated joint ventures
|
—
|
|
|
201
|
|
|
—
|
|
|
—
|
|
|
201
|
|
|||||
Equity in net income of subsidiaries
|
2,022
|
|
|
—
|
|
|
—
|
|
|
(2,022
|
)
|
|
—
|
|
|||||
Other income (expense), net
|
26
|
|
|
(174
|
)
|
|
—
|
|
|
—
|
|
|
(148
|
)
|
|||||
Income before income taxes
|
1,078
|
|
|
3,449
|
|
|
—
|
|
|
(2,022
|
)
|
|
2,505
|
|
|||||
Benefit (provision) for income taxes
|
439
|
|
|
(1,427
|
)
|
|
—
|
|
|
—
|
|
|
(988
|
)
|
|||||
Net income
|
1,517
|
|
|
2,022
|
|
|
—
|
|
|
(2,022
|
)
|
|
1,517
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net income attributable to The New Home Company Inc.
|
$
|
1,517
|
|
|
$
|
2,022
|
|
|
$
|
—
|
|
|
$
|
(2,022
|
)
|
|
$
|
1,517
|
|
|
Three Months Ended June 30, 2016
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
$
|
—
|
|
|
$
|
77,486
|
|
|
$
|
1,350
|
|
|
$
|
—
|
|
|
$
|
78,836
|
|
Fee Building
|
—
|
|
|
30,068
|
|
|
—
|
|
|
(40
|
)
|
|
30,028
|
|
|||||
|
—
|
|
|
107,554
|
|
|
1,350
|
|
|
(40
|
)
|
|
108,864
|
|
|||||
Cost of Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
68,152
|
|
|
1,238
|
|
|
—
|
|
|
69,390
|
|
|||||
Fee building
|
496
|
|
|
27,821
|
|
|
—
|
|
|
—
|
|
|
28,317
|
|
|||||
|
496
|
|
|
95,973
|
|
|
1,238
|
|
|
—
|
|
|
97,707
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross Margin:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
9,334
|
|
|
112
|
|
|
—
|
|
|
9,446
|
|
|||||
Fee building
|
(496
|
)
|
|
2,247
|
|
|
—
|
|
|
(40
|
)
|
|
1,711
|
|
|||||
|
(496
|
)
|
|
11,581
|
|
|
112
|
|
|
(40
|
)
|
|
11,157
|
|
|||||
Selling and marketing expenses
|
—
|
|
|
(4,820
|
)
|
|
(226
|
)
|
|
—
|
|
|
(5,046
|
)
|
|||||
General and administrative expenses
|
(3,283
|
)
|
|
(2,550
|
)
|
|
—
|
|
|
—
|
|
|
(5,833
|
)
|
|||||
Equity in net income of unconsolidated joint ventures
|
—
|
|
|
3,947
|
|
|
—
|
|
|
—
|
|
|
3,947
|
|
|||||
Equity in net income of subsidiaries
|
4,843
|
|
|
—
|
|
|
—
|
|
|
(4,843
|
)
|
|
—
|
|
|||||
Other income (expense), net
|
(57
|
)
|
|
(229
|
)
|
|
(40
|
)
|
|
40
|
|
|
(286
|
)
|
|||||
Income (loss) before income taxes
|
1,007
|
|
|
7,929
|
|
|
(154
|
)
|
|
(4,843
|
)
|
|
3,939
|
|
|||||
Benefit (provision) for income taxes
|
1,502
|
|
|
(2,997
|
)
|
|
—
|
|
|
—
|
|
|
(1,495
|
)
|
|||||
Net income (loss)
|
2,509
|
|
|
4,932
|
|
|
(154
|
)
|
|
(4,843
|
)
|
|
2,444
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|
65
|
|
|||||
Net income (loss) attributable to The New Home Company Inc.
|
$
|
2,509
|
|
|
$
|
4,932
|
|
|
$
|
(89
|
)
|
|
$
|
(4,843
|
)
|
|
$
|
2,509
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
$
|
—
|
|
|
$
|
166,335
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
166,335
|
|
Fee Building
|
—
|
|
|
102,798
|
|
|
—
|
|
|
—
|
|
|
102,798
|
|
|||||
|
—
|
|
|
269,133
|
|
|
—
|
|
|
—
|
|
|
269,133
|
|
|||||
Cost of Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
142,522
|
|
|
31
|
|
|
—
|
|
|
142,553
|
|
|||||
Home sales impairment
|
—
|
|
|
1,300
|
|
|
—
|
|
|
—
|
|
|
1,300
|
|
|||||
Fee building
|
1,085
|
|
|
98,740
|
|
|
—
|
|
|
—
|
|
|
99,825
|
|
|||||
|
1,085
|
|
|
242,562
|
|
|
31
|
|
|
—
|
|
|
243,678
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross Margin:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
22,513
|
|
|
(31
|
)
|
|
—
|
|
|
22,482
|
|
|||||
Fee building
|
(1,085
|
)
|
|
4,058
|
|
|
—
|
|
|
—
|
|
|
2,973
|
|
|||||
|
(1,085
|
)
|
|
26,571
|
|
|
(31
|
)
|
|
—
|
|
|
25,455
|
|
|||||
Selling and marketing expenses
|
—
|
|
|
(11,377
|
)
|
|
—
|
|
|
—
|
|
|
(11,377
|
)
|
|||||
General and administrative expenses
|
(1,154
|
)
|
|
(9,531
|
)
|
|
—
|
|
|
—
|
|
|
(10,685
|
)
|
|||||
Equity in net income of unconsolidated joint ventures
|
—
|
|
|
507
|
|
|
—
|
|
|
—
|
|
|
507
|
|
|||||
Equity in net income of subsidiaries
|
3,694
|
|
|
—
|
|
|
—
|
|
|
(3,694
|
)
|
|
—
|
|
|||||
Other income (expense), net
|
44
|
|
|
(79
|
)
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
|||||
Income (loss) before income taxes
|
1,499
|
|
|
6,091
|
|
|
(31
|
)
|
|
(3,694
|
)
|
|
3,865
|
|
|||||
Benefit (provision) for income taxes
|
864
|
|
|
(2,376
|
)
|
|
—
|
|
|
—
|
|
|
(1,512
|
)
|
|||||
Net income (loss)
|
2,363
|
|
|
3,715
|
|
|
(31
|
)
|
|
(3,694
|
)
|
|
2,353
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
10
|
|
|
—
|
|
|
10
|
|
|||||
Net income (loss) attributable to The New Home Company Inc.
|
$
|
2,363
|
|
|
$
|
3,715
|
|
|
$
|
(21
|
)
|
|
$
|
(3,694
|
)
|
|
$
|
2,363
|
|
|
Six Months Ended June 30, 2016
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
$
|
—
|
|
|
$
|
115,982
|
|
|
$
|
5,157
|
|
|
$
|
—
|
|
|
$
|
121,139
|
|
Fee Building
|
—
|
|
|
73,120
|
|
|
—
|
|
|
(155
|
)
|
|
72,965
|
|
|||||
|
—
|
|
|
189,102
|
|
|
5,157
|
|
|
(155
|
)
|
|
194,104
|
|
|||||
Cost of Sales:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
101,422
|
|
|
4,638
|
|
|
—
|
|
|
106,060
|
|
|||||
Fee building
|
966
|
|
|
68,265
|
|
|
—
|
|
|
—
|
|
|
69,231
|
|
|||||
|
966
|
|
|
169,687
|
|
|
4,638
|
|
|
—
|
|
|
175,291
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross Margin:
|
|
|
|
|
|
|
|
|
|
||||||||||
Home sales
|
—
|
|
|
14,560
|
|
|
519
|
|
|
—
|
|
|
15,079
|
|
|||||
Fee building
|
(966
|
)
|
|
4,855
|
|
|
—
|
|
|
(155
|
)
|
|
3,734
|
|
|||||
|
(966
|
)
|
|
19,415
|
|
|
519
|
|
|
(155
|
)
|
|
18,813
|
|
|||||
Selling and marketing expenses
|
—
|
|
|
(7,838
|
)
|
|
(684
|
)
|
|
—
|
|
|
(8,522
|
)
|
|||||
General and administrative expenses
|
(6,466
|
)
|
|
(4,542
|
)
|
|
—
|
|
|
—
|
|
|
(11,008
|
)
|
|||||
Equity in net income of unconsolidated joint ventures
|
—
|
|
|
3,940
|
|
|
—
|
|
|
—
|
|
|
3,940
|
|
|||||
Equity in net income of subsidiaries
|
6,448
|
|
|
—
|
|
|
—
|
|
|
(6,448
|
)
|
|
—
|
|
|||||
Other income (expense), net
|
(39
|
)
|
|
(369
|
)
|
|
(142
|
)
|
|
155
|
|
|
(395
|
)
|
|||||
Income (loss) before income taxes
|
(1,023
|
)
|
|
10,606
|
|
|
(307
|
)
|
|
(6,448
|
)
|
|
2,828
|
|
|||||
Benefit (provision) for income taxes
|
2,718
|
|
|
(3,971
|
)
|
|
—
|
|
|
—
|
|
|
(1,253
|
)
|
|||||
Net income (loss)
|
1,695
|
|
|
6,635
|
|
|
(307
|
)
|
|
(6,448
|
)
|
|
1,575
|
|
|||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
120
|
|
|
—
|
|
|
120
|
|
|||||
Net income (loss) attributable to The New Home Company Inc.
|
$
|
1,695
|
|
|
$
|
6,635
|
|
|
$
|
(187
|
)
|
|
$
|
(6,448
|
)
|
|
$
|
1,695
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Net cash used in operating activities
|
$
|
(21,176
|
)
|
|
$
|
(49,302
|
)
|
|
$
|
(47
|
)
|
|
$
|
(886
|
)
|
|
$
|
(71,411
|
)
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property and equipment
|
(40
|
)
|
|
(55
|
)
|
|
—
|
|
|
—
|
|
|
(95
|
)
|
|||||
Cash assumed from joint venture at consolidation
|
—
|
|
|
995
|
|
|
—
|
|
|
—
|
|
|
995
|
|
|||||
Contributions and advances to unconsolidated joint venture
|
—
|
|
|
(8,517
|
)
|
|
—
|
|
|
—
|
|
|
(8,517
|
)
|
|||||
Contributions to subsidiaries from corporate
|
(94,035
|
)
|
|
—
|
|
|
—
|
|
|
94,035
|
|
|
—
|
|
|||||
Distributions of capital from subsidiaries
|
19,880
|
|
|
—
|
|
|
—
|
|
|
(19,880
|
)
|
|
—
|
|
|||||
Distributions of capital from unconsolidated joint ventures
|
—
|
|
|
2,948
|
|
|
—
|
|
|
—
|
|
|
2,948
|
|
|||||
Net cash (used in) provided by investing activities
|
$
|
(74,195
|
)
|
|
$
|
(4,629
|
)
|
|
$
|
—
|
|
|
$
|
74,155
|
|
|
$
|
(4,669
|
)
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from senior notes
|
324,465
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
324,465
|
|
|||||
Borrowings from credit facility
|
72,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72,000
|
|
|||||
Repayments of credit facility
|
(190,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(190,000
|
)
|
|||||
Payment of debt issuance costs
|
(6,440
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,440
|
)
|
|||||
Contributions to subsidiaries from corporate
|
—
|
|
|
94,035
|
|
|
—
|
|
|
(94,035
|
)
|
|
—
|
|
|||||
Distributions to corporate from subsidiaries
|
—
|
|
|
(20,766
|
)
|
|
—
|
|
|
20,766
|
|
|
—
|
|
|||||
Minimum tax withholding paid on behalf of employees for stock awards
|
(584
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(584
|
)
|
|||||
Proceeds from exercise of stock options
|
102
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
102
|
|
|||||
Net cash provided by financing activities
|
$
|
199,543
|
|
|
$
|
73,269
|
|
|
$
|
—
|
|
|
$
|
(73,269
|
)
|
|
$
|
199,543
|
|
Net increase (decrease) in cash and cash equivalents
|
104,172
|
|
|
19,338
|
|
|
(47
|
)
|
|
—
|
|
|
123,463
|
|
|||||
Cash and cash equivalents – beginning of period
|
16,385
|
|
|
13,842
|
|
|
269
|
|
|
—
|
|
|
30,496
|
|
|||||
Cash and cash equivalents – end of period
|
$
|
120,557
|
|
|
$
|
33,180
|
|
|
$
|
222
|
|
|
$
|
—
|
|
|
$
|
153,959
|
|
|
Six Months Ended June 30, 2016
|
||||||||||||||||||
|
NWHM Inc.
|
|
Guarantor Subsidiaries
|
|
Non-Guarantor Subsidiaries
|
|
Consolidating Adjustments
|
|
Consolidated NWHM
|
||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||
Net cash used in operating activities
|
$
|
(22,026
|
)
|
|
$
|
(144,949
|
)
|
|
$
|
3,347
|
|
|
$
|
(2,071
|
)
|
|
$
|
(165,699
|
)
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Purchases of property and equipment
|
(156
|
)
|
|
(140
|
)
|
|
—
|
|
|
—
|
|
|
(296
|
)
|
|||||
Cash assumed from joint venture at consolidation
|
—
|
|
|
2,009
|
|
|
—
|
|
|
—
|
|
|
2,009
|
|
|||||
Contributions and advances to unconsolidated joint venture
|
—
|
|
|
(5,656
|
)
|
|
—
|
|
|
—
|
|
|
(5,656
|
)
|
|||||
Contributions to subsidiaries from corporate
|
(160,406
|
)
|
|
—
|
|
|
—
|
|
|
160,406
|
|
|
—
|
|
|||||
Distributions of capital from subsidiaries
|
18,929
|
|
|
725
|
|
|
—
|
|
|
(19,654
|
)
|
|
—
|
|
|||||
Distributions of capital from unconsolidated joint ventures
|
—
|
|
|
7,405
|
|
|
—
|
|
|
—
|
|
|
7,405
|
|
|||||
Net cash (used in) provided by investing activities
|
$
|
(141,633
|
)
|
|
$
|
4,343
|
|
|
$
|
—
|
|
|
$
|
140,752
|
|
|
$
|
3,462
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings from senior notes and credit facility
|
175,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
175,000
|
|
|||||
Repayments of credit facility
|
(11,000
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,000
|
)
|
|||||
Borrowings from other notes payable
|
—
|
|
|
—
|
|
|
343
|
|
|
—
|
|
|
343
|
|
|||||
Repayments of other notes payable
|
—
|
|
|
(13,135
|
)
|
|
(2,501
|
)
|
|
—
|
|
|
(15,636
|
)
|
|||||
Payment of debt issuance costs
|
(1,064
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,064
|
)
|
|||||
Cash distributions to noncontrolling interest in subsidiary
|
—
|
|
|
—
|
|
|
(725
|
)
|
|
—
|
|
|
(725
|
)
|
|||||
Contributions to subsidiaries from corporate
|
—
|
|
|
160,406
|
|
|
—
|
|
|
(160,406
|
)
|
|
—
|
|
|||||
Distributions to corporate from subsidiaries
|
—
|
|
|
(21,000
|
)
|
|
(725
|
)
|
|
21,725
|
|
|
—
|
|
|||||
Minimum tax withholding paid on behalf of employees for stock awards
|
(647
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(647
|
)
|
|||||
Excess income tax provision from stock-based compensation
|
(97
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(97
|
)
|
|||||
Net cash provided by (used in) financing activities
|
$
|
162,192
|
|
|
$
|
126,271
|
|
|
$
|
(3,608
|
)
|
|
$
|
(138,681
|
)
|
|
$
|
146,174
|
|
Net decrease in cash and cash equivalents
|
(1,467
|
)
|
|
(14,335
|
)
|
|
(261
|
)
|
|
—
|
|
|
(16,063
|
)
|
|||||
Cash and cash equivalents – beginning of period
|
18,129
|
|
|
27,140
|
|
|
605
|
|
|
—
|
|
|
45,874
|
|
|||||
Cash and cash equivalents – end of period
|
$
|
16,662
|
|
|
$
|
12,805
|
|
|
$
|
344
|
|
|
$
|
—
|
|
|
$
|
29,811
|
|
Item 2
.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Risks related to our business, including among other things:
|
◦
|
our geographic concentration primarily in California;
|
◦
|
the cyclical nature of the homebuilding industry which is affected by general economic real estate and other business conditions;
|
◦
|
availability of land to acquire and our ability to acquire such land on favorable terms or at all;
|
◦
|
shortages of or increased prices for labor, land or raw materials used in housing construction;
|
◦
|
the illiquid nature of real estate investments;
|
◦
|
economic changes either nationally or in the markets in which we operate, including declines in employment, volatility of mortgage interest rates and inflation;
|
◦
|
the degree and nature of our competition;
|
◦
|
a large proportion of our fee building revenue being dependent upon one customer;
|
◦
|
delays in land development or home construction resulting from adverse weather conditions, regulatory approval delays, or other events outside our control;
|
◦
|
product liability and warranty claims, including the cost and availability of insurance;
|
◦
|
information systems interruption or breach in security;
|
•
|
Risks related to laws and regulations, including among other things:
|
◦
|
changes in, or the failure or inability to comply with, governmental laws and regulations; including environmental laws and regulations;
|
◦
|
mortgage financing, as well as our customer’s ability to obtain such financing, interest rate increases or changes in federal lending programs;
|
◦
|
the timing of receipt of regulatory approvals and the opening of projects;
|
◦
|
the impact of recent accounting standards;
|
•
|
Risks related to financing and indebtedness, including among other things:
|
◦
|
Volatility and uncertainty in the credit markets and broader financial markets;
|
◦
|
our liquidity and availability, terms and deployment of capital;
|
◦
|
issues concerning our joint venture partnerships, in which we have less than a controlling interest;
|
◦
|
our leverage, interest expense, debt service obligations and restrictive covenants related to our operations in our current or future financing arrangements, including under our unsecured credit facility and our senior notes;
|
•
|
Risks related to our structure and ownership of our common stock, including among other things:
|
◦
|
availability of qualified personnel and our ability to retain our key personnel;
|
◦
|
Our status as an emerging growth company with a limited operating history;
|
◦
|
the price of our common stock is subject to volatility and our trading volume is relatively low;
|
◦
|
our senior notes rank senior to our common stock upon bankruptcy or liquidation.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(Dollars in thousands)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Home sales
|
$
|
96,929
|
|
|
$
|
78,836
|
|
|
$
|
166,335
|
|
|
$
|
121,139
|
|
Fee building, including management fees from unconsolidated joint ventures of $1,217, $2,537, $2,431 and $4,712, respectively
|
47,181
|
|
|
30,028
|
|
|
102,798
|
|
|
72,965
|
|
||||
|
144,110
|
|
|
108,864
|
|
|
269,133
|
|
|
194,104
|
|
||||
Cost of Sales:
|
|
|
|
|
|
|
|
||||||||
Home sales
|
82,488
|
|
|
69,390
|
|
|
142,553
|
|
|
106,060
|
|
||||
Home sales impairments
|
1,300
|
|
|
—
|
|
|
1,300
|
|
|
—
|
|
||||
Fee building
|
45,899
|
|
|
28,317
|
|
|
99,825
|
|
|
69,231
|
|
||||
|
129,687
|
|
|
97,707
|
|
|
243,678
|
|
|
175,291
|
|
||||
Gross Margin:
|
|
|
|
|
|
|
|
||||||||
Home sales
|
13,141
|
|
|
9,446
|
|
|
22,482
|
|
|
15,079
|
|
||||
Fee building
|
1,282
|
|
|
1,711
|
|
|
2,973
|
|
|
3,734
|
|
||||
|
14,423
|
|
|
11,157
|
|
|
25,455
|
|
|
18,813
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Home sales gross margin
|
13.6
|
%
|
|
12.0
|
%
|
|
13.5
|
%
|
|
12.4
|
%
|
||||
Home sales gross margin before impairments
(1)
|
14.9
|
%
|
|
12.0
|
%
|
|
14.3
|
%
|
|
12.4
|
%
|
||||
Fee building gross margin
|
2.7
|
%
|
|
5.7
|
%
|
|
2.9
|
%
|
|
5.1
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Selling and marketing expenses
|
(6,376
|
)
|
|
(5,046
|
)
|
|
(11,377
|
)
|
|
(8,522
|
)
|
||||
General and administrative expenses
|
(5,595
|
)
|
|
(5,833
|
)
|
|
(10,685
|
)
|
|
(11,008
|
)
|
||||
Equity in net income of unconsolidated joint ventures
|
201
|
|
|
3,947
|
|
|
507
|
|
|
3,940
|
|
||||
Other income (expense), net
|
(148
|
)
|
|
(286
|
)
|
|
(35
|
)
|
|
(395
|
)
|
||||
Income before income taxes
|
2,505
|
|
|
3,939
|
|
|
3,865
|
|
|
2,828
|
|
||||
Provision for income taxes
|
(988
|
)
|
|
(1,495
|
)
|
|
(1,512
|
)
|
|
(1,253
|
)
|
||||
Net income
|
1,517
|
|
|
2,444
|
|
|
2,353
|
|
|
1,575
|
|
||||
Net loss attributable to noncontrolling interest
|
—
|
|
|
65
|
|
|
10
|
|
|
120
|
|
||||
Net income attributable to The New Home Company Inc.
|
$
|
1,517
|
|
|
$
|
2,509
|
|
|
$
|
2,363
|
|
|
$
|
1,695
|
|
|
|
|
|
|
|
|
|
||||||||
Interest incurred
|
$
|
6,401
|
|
|
$
|
1,689
|
|
|
$
|
8,437
|
|
|
$
|
2,970
|
|
Adjusted EBITDA
(2)
|
$
|
6,304
|
|
|
$
|
3,213
|
|
|
$
|
11,265
|
|
|
$
|
4,016
|
|
Adjusted EBITDA margin percentage
|
4.4
|
%
|
|
3.0
|
%
|
|
4.2
|
%
|
|
2.1
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
LTM
(3)
Ended June 30,
|
||||||||||
|
|
|
|
|
2017
|
|
2016
|
||||||||
Interest incurred
|
|
|
|
|
$
|
12,951
|
|
|
$
|
5,766
|
|
||||
Adjusted EBITDA
(2)
|
|
|
|
|
$
|
50,393
|
|
|
$
|
37,662
|
|
||||
Adjusted EBITDA margin percentage
(2)
|
|
|
|
|
6.5
|
%
|
|
7.9
|
%
|
||||||
Ratio of Adjusted EBITDA to total interest incurred
(2)
|
|
|
|
|
3.9x
|
|
|
6.5x
|
|
|
(1)
|
Home sales gross margin before impairments (also referred to as homebuilding gross margin before impairments) is a non-GAAP measure. The table below reconciles this non-GAAP financial measure to homebuilding gross margin, the nearest GAAP equivalent.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2017
|
|
%
|
|
2016
|
|
%
|
|
2017
|
|
%
|
|
2016
|
|
%
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||
Home sales revenue
|
$
|
96,929
|
|
|
100.0
|
%
|
|
$
|
78,836
|
|
|
100.0
|
%
|
|
$
|
166,335
|
|
|
100.0
|
%
|
|
$
|
121,139
|
|
|
100.0
|
%
|
Cost of home sales
|
83,788
|
|
|
86.4
|
%
|
|
69,390
|
|
|
88.0
|
%
|
|
143,853
|
|
|
86.5
|
%
|
|
106,060
|
|
|
87.6
|
%
|
||||
Homebuilding gross margin
|
13,141
|
|
|
13.6
|
%
|
|
9,446
|
|
|
12.0
|
%
|
|
22,482
|
|
|
13.5
|
%
|
|
15,079
|
|
|
12.4
|
%
|
||||
Add: Home sales impairments
|
1,300
|
|
|
1.3
|
%
|
|
—
|
|
|
—
|
%
|
|
1,300
|
|
|
0.8
|
%
|
|
—
|
|
|
—
|
%
|
||||
Homebuilding gross margin before impairments
(1)
|
$
|
14,441
|
|
|
14.9
|
%
|
|
$
|
9,446
|
|
|
12.0
|
%
|
|
$
|
23,782
|
|
|
14.3
|
%
|
|
$
|
15,079
|
|
|
12.4
|
%
|
(2)
|
Adjusted EBITDA, Adjusted EBITDA margin percentage and ratio of Adjusted EBITDA to total interest incurred are non-GAAP measures. Adjusted EBITDA margin percentage is calculated as a percentage of total revenue. Management believes that Adjusted EBITDA, which is a non-GAAP measure, assists investors in understanding and comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies' respective capitalization, interest costs, tax position and inventory impairments. Due to the significance of the GAAP components excluded, Adjusted EBITDA should not be considered in isolation or as an alternative to net income, cash flows from operations or any other performance measure prescribed by GAAP. The table below reconciles net income (loss), calculated and presented in accordance with GAAP, to Adjusted EBITDA, Adjusted EBITDA margin percentage and ratio of Adjusted EBITDA to total interest incurred.
|
|
Three Months Ended June 30,
|
|
Six Months Ended
June 30,
|
|
LTM
(3)
Ended
June 30,
|
||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||||
|
(Dollars in thousands)
|
|
|
|
|
||||||||||||||||||
Net income (loss)
|
$
|
1,517
|
|
|
$
|
2,444
|
|
|
$
|
2,353
|
|
|
$
|
1,575
|
|
|
$
|
21,704
|
|
|
$
|
18,133
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest amortized to cost of sales and other expense
|
1,720
|
|
|
1,063
|
|
|
3,271
|
|
|
1,711
|
|
|
6,891
|
|
|
3,827
|
|
||||||
Provision (benefit) for income taxes
|
988
|
|
|
1,495
|
|
|
1,512
|
|
|
1,253
|
|
|
13,283
|
|
|
10,761
|
|
||||||
Depreciation and amortization
|
113
|
|
|
126
|
|
|
236
|
|
|
251
|
|
|
496
|
|
|
492
|
|
||||||
Amortization of equity-based compensation
|
695
|
|
|
757
|
|
|
1,306
|
|
|
1,742
|
|
|
3,035
|
|
|
4,391
|
|
||||||
Cash distributions of income from unconsolidated joint ventures
|
—
|
|
|
1,095
|
|
|
1,588
|
|
|
1,095
|
|
|
4,235
|
|
|
12,120
|
|
||||||
Non-cash impairments and abandonments
|
1,472
|
|
|
180
|
|
|
1,506
|
|
|
329
|
|
|
5,257
|
|
|
521
|
|
||||||
Less:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain from notes payable principal reduction
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(250
|
)
|
|
—
|
|
||||||
Equity in income of unconsolidated joint ventures
|
(201
|
)
|
|
(3,947
|
)
|
|
(507
|
)
|
|
(3,940
|
)
|
|
(4,258
|
)
|
|
(12,583
|
)
|
||||||
Adjusted EBITDA
|
$
|
6,304
|
|
|
$
|
3,213
|
|
|
$
|
11,265
|
|
|
$
|
4,016
|
|
|
$
|
50,393
|
|
|
$
|
37,662
|
|
Total Revenue
|
$
|
144,110
|
|
|
$
|
108,864
|
|
|
$
|
269,133
|
|
|
$
|
194,104
|
|
|
$
|
769,485
|
|
|
$
|
475,707
|
|
Adjusted EBITDA margin percentage
|
4.4
|
%
|
|
3.0
|
%
|
|
4.2
|
%
|
|
2.1
|
%
|
|
6.5
|
%
|
|
7.9
|
%
|
||||||
Interest incurred
|
$
|
6,401
|
|
|
$
|
1,689
|
|
|
$
|
8,437
|
|
|
$
|
2,970
|
|
|
$
|
12,951
|
|
|
$
|
5,766
|
|
Ratio of Adjusted EBITDA to total interest incurred
|
|
|
|
|
|
|
|
|
3.9x
|
|
|
6.5x
|
|
(3)
|
"LTM" indicates amounts for the trailing 12 months.
|
|
Three Months Ended
June 30, |
|
Increase/(Decrease)
|
|
Six Months Ended
June 30, |
|
Increase/(Decrease)
|
||||||||||||||||
|
2017
|
|
2016
|
|
Amount
|
|
%
|
|
2017
|
|
2016
|
|
Amount
|
|
%
|
||||||||
|
|
||||||||||||||||||||||
Net new home orders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Southern California
|
44
|
|
|
39
|
|
|
5
|
|
|
13
|
%
|
|
100
|
|
|
66
|
|
|
34
|
|
|
52
|
%
|
Northern California
|
54
|
|
|
25
|
|
|
29
|
|
|
116
|
%
|
|
124
|
|
|
54
|
|
|
70
|
|
|
130
|
%
|
Total
|
98
|
|
|
64
|
|
|
34
|
|
|
53
|
%
|
|
224
|
|
|
120
|
|
|
104
|
|
|
87
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Selling communities at end of period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Southern California
|
|
|
|
|
|
|
|
|
|
|
6
|
|
|
7
|
|
|
(1
|
)
|
|
(14
|
)%
|
||
Northern California
|
|
|
|
|
|
|
|
|
|
|
3
|
|
|
5
|
|
|
(2
|
)
|
|
(40
|
)%
|
||
Total
|
|
|
|
|
|
|
|
|
|
9
|
|
|
12
|
|
|
(3
|
)
|
|
(25
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Monthly sales absorption rate per community
(1)
|
3.3
|
|
|
1.9
|
|
|
1.4
|
|
|
74
|
%
|
|
3.0
|
|
|
1.9
|
|
|
1.1
|
|
|
58
|
%
|
Cancellation rate
|
10
|
%
|
|
6
|
%
|
|
4
|
%
|
|
N/A
|
|
|
8
|
%
|
|
13
|
%
|
|
(5
|
)%
|
|
N/A
|
|
|
|
As of June 30,
|
|||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||||||||||||||||||||||
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||
Southern California
|
99
|
|
|
$
|
278,513
|
|
|
$
|
2,813
|
|
|
89
|
|
|
$
|
249,433
|
|
|
$
|
2,803
|
|
|
11
|
%
|
|
12
|
%
|
|
—
|
%
|
Northern California
|
86
|
|
|
60,899
|
|
|
708
|
|
|
36
|
|
|
28,567
|
|
|
794
|
|
|
139
|
%
|
|
113
|
%
|
|
(11
|
)%
|
||||
Total
|
185
|
|
|
$
|
339,412
|
|
|
$
|
1,835
|
|
|
125
|
|
|
$
|
278,000
|
|
|
$
|
2,224
|
|
|
48
|
%
|
|
22
|
%
|
|
(17
|
)%
|
|
June 30,
|
|
Increase/(Decrease)
|
||||||||
|
2017
|
|
2016
|
|
Amount
|
|
%
|
||||
Lots Owned:
|
|
|
|
|
|
|
|
||||
Southern California
|
402
|
|
|
226
|
|
|
176
|
|
|
78
|
%
|
Northern California
|
285
|
|
|
249
|
|
|
36
|
|
|
14
|
%
|
Total
|
687
|
|
|
475
|
|
|
212
|
|
|
45
|
%
|
Lots Controlled:
(1)
|
|
|
|
|
|
|
|
||||
Southern California
|
564
|
|
|
631
|
|
|
(67
|
)
|
|
(11
|
)%
|
Northern California
|
303
|
|
|
379
|
|
|
(76
|
)
|
|
(20
|
)%
|
Arizona
|
267
|
|
|
—
|
|
|
267
|
|
|
NA
|
|
Total
|
1,134
|
|
|
1,010
|
|
|
124
|
|
|
12
|
%
|
Total Lots Owned and Controlled - Wholly Owned
|
1,821
|
|
|
1,485
|
|
|
336
|
|
|
23
|
%
|
Fee Building
(2)
|
1,043
|
|
|
1,001
|
|
|
42
|
|
|
4
|
%
|
Total Lots Owned and Controlled
|
2,864
|
|
|
2,486
|
|
|
378
|
|
|
15
|
%
|
|
(1)
|
Includes lots that we control under purchase and sale agreements or option agreements subject to customary conditions and have not yet closed. There can be no assurance that such acquisitions will occur.
|
(2)
|
Lots owned by third party property owners for which we perform general contracting services.
|
|
Three Months Ended June 30,
|
|||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||||||||||||||||||||||
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||
Southern California
|
27
|
|
|
$
|
67,279
|
|
|
$
|
2,492
|
|
|
20
|
|
|
$
|
54,900
|
|
|
$
|
2,745
|
|
|
35
|
%
|
|
23
|
%
|
|
(9
|
)%
|
Northern California
|
37
|
|
|
29,650
|
|
|
801
|
|
|
23
|
|
|
23,936
|
|
|
1,041
|
|
|
61
|
%
|
|
24
|
%
|
|
(23
|
)%
|
||||
Total
|
64
|
|
|
$
|
96,929
|
|
|
$
|
1,515
|
|
|
43
|
|
|
$
|
78,836
|
|
|
$
|
1,833
|
|
|
49
|
%
|
|
23
|
%
|
|
(17
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Six Months Ended June 30,
|
|||||||||||||||||||||||||||||
|
2017
|
|
2016
|
|
% Change
|
|||||||||||||||||||||||||
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|
Homes
|
|
Dollar Value
|
|
Average Price
|
|||||||||||||
|
(Dollars in thousands)
|
|||||||||||||||||||||||||||||
Southern California
|
49
|
|
|
$
|
111,202
|
|
|
$
|
2,269
|
|
|
31
|
|
|
$
|
84,208
|
|
|
$
|
2,716
|
|
|
58
|
%
|
|
32
|
%
|
|
(16
|
)%
|
Northern California
|
69
|
|
|
55,133
|
|
|
799
|
|
|
40
|
|
|
36,931
|
|
|
923
|
|
|
73
|
%
|
|
49
|
%
|
|
(13
|
)%
|
||||
Total
|
118
|
|
|
$
|
166,335
|
|
|
$
|
1,410
|
|
|
71
|
|
|
$
|
121,139
|
|
|
$
|
1,706
|
|
|
66
|
%
|
|
37
|
%
|
|
(17
|
)%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2017
|
|
%
|
|
2016
|
|
%
|
|
2017
|
|
%
|
|
2016
|
|
%
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||
Home sales revenue
|
$
|
96,929
|
|
|
100.0
|
%
|
|
$
|
78,836
|
|
|
100.0
|
%
|
|
$
|
166,335
|
|
|
100.0
|
%
|
|
$
|
121,139
|
|
|
100.0
|
%
|
Cost of home sales
|
83,788
|
|
|
86.4
|
%
|
|
69,390
|
|
|
88.0
|
%
|
|
143,853
|
|
|
86.5
|
%
|
|
106,060
|
|
|
87.6
|
%
|
||||
Homebuilding gross margin
|
13,141
|
|
|
13.6
|
%
|
|
9,446
|
|
|
12.0
|
%
|
|
22,482
|
|
|
13.5
|
%
|
|
15,079
|
|
|
12.4
|
%
|
||||
Add: Home sales impairments
|
1,300
|
|
|
1.3
|
%
|
|
—
|
|
|
—
|
%
|
|
1,300
|
|
|
0.8
|
%
|
|
—
|
|
|
—
|
%
|
||||
Homebuilding gross margin before impairments
(1)
|
14,441
|
|
|
14.9
|
%
|
|
9,446
|
|
|
12.0
|
%
|
|
23,782
|
|
|
14.3
|
%
|
|
15,079
|
|
|
12.4
|
%
|
||||
Add: Interest in cost of home sales
|
1,720
|
|
|
1.8
|
%
|
|
1,063
|
|
|
1.3
|
%
|
|
3,271
|
|
|
2.0
|
%
|
|
1,711
|
|
|
1.5
|
%
|
||||
Adjusted homebuilding gross margin
(1)
|
$
|
16,161
|
|
|
16.7
|
%
|
|
$
|
10,509
|
|
|
13.3
|
%
|
|
$
|
27,053
|
|
|
16.3
|
%
|
|
$
|
16,790
|
|
|
13.9
|
%
|
|
(1)
|
Homebuilding gross margin before impairments and adjusted homebuilding gross margin are non-GAAP financial measures. We believe this information is meaningful as it isolates the impact that home sales impairments and leverage have on homebuilding gross margin and permits investors to make better comparisons with our competitors who also break out and adjust gross margins in a similar fashion.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2017
|
|
%
|
|
2016
|
|
%
|
|
2017
|
|
%
|
|
2016
|
|
%
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||
Fee building revenues
|
$
|
47,181
|
|
|
100.0
|
%
|
|
$
|
30,028
|
|
|
100.0
|
%
|
|
$
|
102,798
|
|
|
100.0
|
%
|
|
$
|
72,965
|
|
|
100.0
|
%
|
Cost of fee building
|
45,899
|
|
|
97.3
|
%
|
|
28,317
|
|
|
94.3
|
%
|
|
99,825
|
|
|
97.1
|
%
|
|
69,231
|
|
|
94.9
|
%
|
||||
Fee building gross margin
|
$
|
1,282
|
|
|
2.7
|
%
|
|
$
|
1,711
|
|
|
5.7
|
%
|
|
$
|
2,973
|
|
|
2.9
|
%
|
|
$
|
3,734
|
|
|
5.1
|
%
|
|
Three Months Ended
June 30, |
|
As a Percentage of Home Sales Revenue
|
|
Six Months Ended
June 30, |
|
As a Percentage of Home Sales Revenue
|
||||||||||||||||||||
|
|
|
|
||||||||||||||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||
Selling and marketing expenses
|
$
|
6,376
|
|
|
$
|
5,046
|
|
|
6.6
|
%
|
|
6.4
|
%
|
|
$
|
11,377
|
|
|
$
|
8,522
|
|
|
6.8
|
%
|
|
7.0
|
%
|
General and administrative expenses (“G&A”)
|
5,595
|
|
|
5,833
|
|
|
5.8
|
%
|
|
7.4
|
%
|
|
10,685
|
|
|
11,008
|
|
|
6.4
|
%
|
|
9.1
|
%
|
||||
Total selling, marketing and G&A (“SG&A”)
|
$
|
11,971
|
|
|
$
|
10,879
|
|
|
12.4
|
%
|
|
13.8
|
%
|
|
$
|
22,062
|
|
|
$
|
19,530
|
|
|
13.3
|
%
|
|
16.1
|
%
|
|
Three Months Ended
June 30, |
|
|
|
Six Months Ended
June 30, |
|
|
||||||||||||||||||||||
|
|
Increase/(Decrease)
|
|
|
Increase/(Decrease)
|
||||||||||||||||||||||||
|
2017
|
|
2016
|
|
Amount
|
|
%
|
|
2017
|
|
2016
|
|
Amount
|
|
%
|
||||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||
Unconsolidated Joint Ventures
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Net new home orders
|
54
|
|
|
30
|
|
|
24
|
|
|
80
|
%
|
|
93
|
|
|
76
|
|
|
17
|
|
|
22
|
%
|
||||||
New homes delivered
|
33
|
|
|
55
|
|
|
(22
|
)
|
|
(40
|
)%
|
|
65
|
|
|
100
|
|
|
(35
|
)
|
|
(35
|
)%
|
||||||
Average sales price of homes delivered
|
|
$
|
914
|
|
|
$
|
859
|
|
|
$
|
55
|
|
|
6
|
%
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Home sales revenue
|
$
|
34,240
|
|
|
$
|
47,698
|
|
|
$
|
(13,458
|
)
|
|
(28
|
)%
|
|
$
|
59,386
|
|
|
$
|
85,899
|
|
|
$
|
(26,513
|
)
|
|
(31
|
)%
|
Land sales revenue
|
931
|
|
|
22,406
|
|
|
(21,475
|
)
|
|
(96
|
)%
|
|
2,405
|
|
|
26,162
|
|
|
(23,757
|
)
|
|
(91
|
)%
|
||||||
Total revenue
|
$
|
35,171
|
|
|
$
|
70,104
|
|
|
$
|
(34,933
|
)
|
|
(50
|
)%
|
|
$
|
61,791
|
|
|
$
|
112,061
|
|
|
$
|
(50,270
|
)
|
|
(45
|
)%
|
Net income (loss)
|
$
|
(654
|
)
|
|
$
|
10,195
|
|
|
$
|
(10,849
|
)
|
|
(106
|
)%
|
|
$
|
(1,518
|
)
|
|
$
|
12,336
|
|
|
$
|
(13,854
|
)
|
|
(112
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Selling communities at end of period
|
|
8
|
|
|
3
|
|
|
5
|
|
|
167
|
%
|
|||||||||||||||||
Backlog (dollar value)
|
|
$
|
70,941
|
|
|
$
|
71,970
|
|
|
$
|
(1,029
|
)
|
|
(1
|
)%
|
||||||||||||||
Backlog (homes)
|
|
90
|
|
|
76
|
|
|
14
|
|
|
18
|
%
|
|||||||||||||||||
Average sales price of backlog
|
|
$
|
788
|
|
|
$
|
947
|
|
|
$
|
(159
|
)
|
|
(17
|
)%
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Homebuilding lots owned and controlled
|
|
520
|
|
|
610
|
|
|
(90
|
)
|
|
(15
|
)%
|
|||||||||||||||||
Land development lots owned and controlled
|
|
2,415
|
|
|
2,512
|
|
|
(97
|
)
|
|
(4
|
)%
|
|||||||||||||||||
Total lots owned and controlled
|
|
2,935
|
|
|
3,122
|
|
|
(187
|
)
|
|
(6
|
)%
|
|
June 30, 2017
|
|||
Financial Conditions
|
Actual
|
|
Requirement
|
|
|
|
|||
Fixed Charge Coverage Ratio: EBITDA to Consolidated Interest Incurred
|
3.9
|
|
|
> 2.0 : 1.0
|
Leverage Ratio: Indebtedness to Tangible Net Worth
|
1.29
|
|
|
< 2.25 : 1.0
|
|
June 30, 2017
|
||||||
Financial Covenants
|
Actual
|
|
Covenant
Requirement
|
||||
|
(Dollars in thousands)
|
||||||
Unencumbered Liquid Assets
|
$
|
153,959
|
|
|
$
|
8,239
|
|
EBITDA to Interest Incurred
|
3.9
|
|
|
> 1.5 : 1.0
|
|
||
Tangible Net Worth
|
$
|
247,710
|
|
|
$
|
176,341
|
|
Leverage Ratio
|
42
|
%
|
|
< 65%
|
|
||
Adjusted Leverage Ratio
(1)
|
33
|
%
|
|
< 50%
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
(Dollars in thousands)
|
||||||
Total debt, net
|
$
|
318,121
|
|
|
$
|
118,000
|
|
Equity, exclusive of noncontrolling interest
|
247,710
|
|
|
244,523
|
|
||
Total capital
|
$
|
565,831
|
|
|
$
|
362,523
|
|
Ratio of debt-to-capital
(1)
|
56.2
|
%
|
|
32.5
|
%
|
||
|
|
|
|
||||
Total debt, net
|
$
|
318,121
|
|
|
$
|
118,000
|
|
Less: cash, cash equivalents and restricted cash
|
154,047
|
|
|
31,081
|
|
||
Net debt
|
164,074
|
|
|
86,919
|
|
||
Equity, exclusive of noncontrolling interest
|
247,710
|
|
|
244,523
|
|
||
Total capital
|
$
|
411,784
|
|
|
$
|
331,442
|
|
Ratio of net debt-to-capital
(2)
|
39.8
|
%
|
|
26.2
|
%
|
|
(1)
|
The ratio of debt-to-capital is computed as the quotient obtained by dividing total debt, net by the sum of total debt plus equity, exclusive of noncontrolling interest.
|
(2)
|
The ratio of net debt-to-capital is computed as the quotient obtained by dividing net debt (which is total debt, net less cash to the extent necessary to reduce the debt balance to zero) by total capital, exclusive of noncontrolling interest. The most directly comparable GAAP financial measure is the ratio of debt-to-capital. We believe the ratio of net debt-to-capital is a relevant financial measure for investors to understand the leverage employed in our operations and as an indicator of our ability to obtain financing. We believe that by deducting our cash from our debt, we provide a measure of our indebtedness that takes into account our cash liquidity. We believe this provides useful information as the ratio of debt-to-capital does not take into account our liquidity and we believe that the ratio net of cash provides supplemental information by which our financial position may be considered. Investors may also find this to be helpful when comparing our leverage to the leverage of our competitors that present similar information. See the table above reconciling this non-GAAP financial measure to the ratio of debt-to-capital.
|
•
|
Net cash used in operating activities was
$71.4 million
for the
six
months ended
June 30, 2017
versus
$165.7 million
for the
six
months ended
June 30, 2016
. The year-over-year change was primarily a result of a net decrease in cash outflows for real estate inventories of
$74.4 million
in the 2017 period compared to
$164.5 million
in the 2016 period. While land deposit and land acquisition spend decreased, the Company continued to make significant investments in real estate inventories as cash outflows for real estate inventories were offset in the 2017 second quarter by increased home deliveries as compared to the prior year period and a greater utilization of rolling option takedowns.
|
•
|
Net cash used in investing activities was
$4.7 million
for the
six
months ended
June 30, 2017
compared to
$3.5 million
provided by investing activities for the
six
months ended
June 30, 2016
. For the
six
months ended
June 30, 2017
, our net contributions and advances to unconsolidated joint ventures were
$5.6 million
compared to a net distribution from unconsolidated joint ventures of
$1.7 million
during the
six
months ended
June 30, 2016
and was the primary reason net cash used in investing activities increased. The reduction in distributions from unconsolidated joint ventures primarily related to the reduction in revenues, new home deliveries, and the completion of certain joint venture communities.
|
•
|
Net cash provided by financing activities was
$199.5 million
for the
six
months ended
June 30, 2017
versus
$146.2 million
for the
six
months ended
June 30, 2016
. The increase was primarily due to an increase in net borrowings, in particular the sale of our Senior Notes due 2022.
|
•
|
leveraging our capital base
|
•
|
accessing larger or highly desirable lot positions
|
•
|
expanding our market opportunities
|
•
|
managing financial and market risk associated with land holdings
|
•
|
establishing strategic alliances
|
|
(1)
|
Scheduled maturities of the unconsolidated joint venture debt as of
June 30, 2017
are as follows: $54.3 million matures in 2017, $16.5 matures in 2018 and $35.7 million matures in 2019. Projects at McKinley Village and Mountain Shadows have multiple debt instruments, some of which do not have LTV maintenance agreements.
|
(2)
|
Represents the Company's equity in unconsolidated joint ventures. Equity does not include $6.0 million in advances to unconsolidated joint ventures and $0.7 million of interest capitalized to certain investments in unconsolidated joint ventures which along with equity, are included in investments in and advances to unconsolidated joint ventures in the accompanying condensed consolidated balance sheets.
|
(3)
|
Estimated future capital commitment represents our proportionate share of estimated future contributions to the respective unconsolidated joint ventures as of
June 30, 2017
. Actual contributions may differ materially.
|
(4)
|
Certain members of the Company's board of directors are affiliated with entities that have an investment in these joint ventures.
|
(5)
|
The debt associated with this joint venture consists of a land seller note.
|
(6)
|
Land development joint venture.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
•
|
our ability to obtain additional financing as needed for working capital, land acquisition costs, building costs, other capital expenditures, or general corporate purposes, or to refinance existing indebtedness before its scheduled maturity, may be limited;
|
•
|
our debt may increase our vulnerability to adverse economic and industry conditions with no assurance that investment yields will increase with higher financing costs;
|
•
|
we may be required to dedicate a portion of our cash flow from operations to payments on our debt, thereby reducing funds available for other purposes such as land and lot acquisition, development and construction activities;
|
•
|
our cash flow from operations may be insufficient to make required payments of principal of and interest on the debt, which would likely result in acceleration of the maturity of such debt;
|
•
|
we may be put at a competitive disadvantage and reduce our flexibility in planning for, or responding to, changing conditions in our industry, including increased competition; and
|
•
|
the terms of any refinancing may not be as favorable as the terms of the debt being refinanced.
|
•
|
incur or guarantee additional indebtedness or issue certain equity interests;
|
•
|
pay dividends or distributions, repurchase equity or prepay subordinated debt;
|
•
|
make certain investments;
|
•
|
sell assets;
|
•
|
incur liens;
|
•
|
create certain restrictions on the ability of restricted subsidiaries to transfer assets;
|
•
|
enter into transactions with affiliates;
|
•
|
create unrestricted subsidiaries; and
|
•
|
consolidate, merge or sell all or substantially all of our assets.
|
•
|
limited in how we conduct our business;
|
•
|
unable to raise additional debt or equity financing to operate during general economic or business downturns; or
|
•
|
unable to compete effectively or to take advantage of new business opportunities. These restrictions may affect our ability to grow in accordance with our plans.
|
Exhibit
Number
|
|
Exhibit Description
|
|
|
|
3.1
|
|
Amended and Restated Certificate of Incorporation of The New Home Company Inc. (incorporated by reference to Exhibit 3.1 of the Company's Annual Report on Form 10-K for the year ended December 31, 2013)
|
|
|
|
3.2
|
|
State of Delaware Certificate of Change of Registered Agent and/or Registered Office (incorporated by reference to Exhibit 3.1 of the Company's Current Report on From 8-K filed on August 1, 2016)
|
|
|
|
3.3
|
|
Amended and Restated Bylaws of The New Home Company Inc. (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed on August 1, 2016)
|
|
|
|
4.1
|
|
Specimen Common Stock Certificate of The New Home Company Inc. (incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form S-1 (Amendment No. 10, filed on January 24, 2014))
|
|
|
|
4.2
|
|
Investor Rights Agreement among The New Home Company Inc., TNHC Partners LLC, IHP Capital Partners VI, LLC, Watt/TNHC LLC, TCN/TNHC LP and collectively H. Lawrence Webb, Wayne J. Stelmar, Joseph D. Davis and Thomas Redwitz (incorporated by reference to Exhibit 4.2 of the Company's Annual Report on Form 10-K for the year ended December 31, 2013)
|
|
|
|
4.3
|
|
Indenture, dated as of March 17, 2017, among the Company, the Guarantors and U.S. Bank National Association, as trustee, including form of 7.25% Senior Notes due 2022 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 20, 2017)
|
|
|
|
4.4
|
|
Form of 7.250% Senior Notes due 2022 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on March 20, 2017)
|
|
|
|
4.5*
|
|
First Supplemental Indenture dated as of April 28, 2017 between the Company and U.S. Bank National Association.
|
|
|
|
4.6
|
|
Officers' Certificate, dated May 4, 2017, delivered pursuant to the Indenture, and setting forth the terms of the Additional Notes 7.25% Senior Notes due 2022 (incorporated by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on May 5, 2017).
|
|
|
|
10.1*
|
|
Letter agreement re: Arantine Hills Holdings LP - funding Excess Shortfall among TNHC-Arantine GP LLC, TNHC Land Company LLC and Arantine Hills Equity LP dated as of June 28, 2017
|
|
|
|
10.2
|
|
Registration Rights Agreement, dated as of May 4, 2017, between the Company, the Guarantors and Credit Suisse Securities (USA) LLC (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on May 5, 2017)
|
|
|
|
31.1*
|
|
Chief Executive Officer Section 302 Certification of Periodic Report dated July 27, 2017
|
|
|
|
31.2*
|
|
Chief Financial Officer Section 302 Certification of Periodic Report dated July 27, 2017
|
|
|
|
32.1**
|
|
Chief Executive Officer Section 906 Certification of Periodic Report dated July 27, 2017
|
|
|
|
32.2**
|
|
Chief Financial Officer Section 906 Certification of Periodic Report dated July 27, 2017
|
|
|
|
101*
|
|
The following materials from The New Home Company Inc.’s Annual Report on Form 10-Q for the quarter ended June 30, 2017, formatted in eXtensible Business Reporting Language (XBRL): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statement of Equity, (iv) Consolidated Statements of Cash Flows, and (v) Notes to Unaudited Consolidated Financial Statements.
|
*
|
Filed herewith
|
**
|
The information in Exhibits 32.1 and 32.2 shall not be deemed "filed" for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act (including this Report), unless the Registrant specifically incorporates the foregoing information into those documents by reference.
|
|
|
|
|
|
|
|
|
|
|
|
The New Home Company Inc.
|
||
|
|
|
|
|||
|
|
|
|
By:
|
|
/s/ H. Lawrence Webb
|
|
|
|
|
|
|
H. Lawrence Webb
|
|
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
/s/ John M. Stephens
|
|
|
|
|
|
|
John M. Stephens
|
|
|
|
|
|
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
By:
|
The New Home Company Southern California LLC
|
Its:
|
Chief Financial Officer
|
By:
|
The New Home Company Southern California LLC
|
Its:
|
Chief Financial Officer
|
By:
|
The New Home Company Southern California LLC
|
Its:
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
By:
|
The New Home Company Southern California LLC
|
Its:
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
By:
|
The New Home Company Southern California LLC
|
Its:
|
Chief Financial Officer
|
By:
|
The New Home Company NORTHERN California LLC
|
Its:
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
Its:
|
Chief Financial Officer
|
(1)
|
I have reviewed this quarterly report on Form 10-Q of The New Home Company 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 15(d)-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.
|
|
|
|
|
Date:
|
July 27, 2017
|
|
/s/ H. Lawrence Webb
|
|
|
|
H. Lawrence Webb
|
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
(1)
|
I have reviewed this quarterly report on Form 10-Q of The New Home Company 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 15(d)-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.
|
|
|
|
|
Date:
|
July 27, 2017
|
|
/s/ John M. Stephens
|
|
|
|
John M. Stephens
|
|
|
|
Chief Financial Officer (Principal Financial Officer and Principal Accounting 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:
|
July 27, 2017
|
|
/s/ H. Lawrence Webb
|
|
|
|
H. Lawrence Webb
|
|
|
|
Chief Executive Officer (Principal 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:
|
July 27, 2017
|
|
/s/ John M. Stephens
|
|
|
|
John M. Stephens
|
|
|
|
Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
|