Wed, Apr 23, 8:36 PM (25 days ago)
**Taylor Morrison Home Corporation (TMHC, Ticker: TMHC) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $1.896 billion, up 12% YoY, driven by a 12% increase in home closings and a 1% increase in average selling price. - **Profit Margins:** Gross margin was 24.0%, consistent with Q1 2024. Adjusted home closings gross margin was 24.8%, reflecting inventory impairment charges. - **Net Income:** $213.5 million, up 12.2% YoY, with earnings per share (EPS) at $2.07, up 18.1% YoY. - **Cash Flow:** Positive operating cash flow of $77.2 million, a significant improvement from a negative $130.7 million in Q1 2024. **Key Metrics:** - **Home Closings:** 3,048 homes, up 11.6% YoY. - **Net Sales Orders:** 3,374, down 8.5% YoY, with a monthly absorption pace of 3.3. - **Lots Owned and Controlled:** 86,266, with 59% controlled off-balance sheet. - **Land Spend:** $469 million, with 46% development-related. **Segment Performance:** - **East:** Strong performance with a 21.2% increase in active selling communities and a 7.4% increase in net sales orders. - **Central:** Steady performance with a 1.1% increase in active selling communities and a 4.1% decrease in net sales orders. - **West:** Mixed results with a 9.6% decrease in active selling communities but a 12.2% increase in average selling price. - **Financial Services:** Revenue increased by 9.0% to $51.2 million, driven by mortgage originations and title services. **Trends and Uncertainties:** - **Inventory Impairment:** $14.9 million in inventory impairment charges due to pricing decreases. - **Seasonality:** Expect higher home closings and revenue in Q3 and Q4. - **Inflation and Interest Rates:** Potential impacts on affordability and construction costs. **Future Operations and Impact:** - **Liquidity:** $1.3 billion in total liquidity, with adequate capital resources for the next 12 months. - **Debt:** Gross debt-to-capitalization ratio of 24.3%, with a net ratio of 20.5%. - **Stock Repurchase:** Repurchased 2.2 million shares for $135 million, with $775 million remaining under the program. **Conclusion:** Taylor Morrison Home Corporation demonstrated strong financial health and performance in Q1 2025, with notable increases in revenue, net income, and home closings. The company's strategic land investments and controlled off-balance sheet lots position it well for future growth. However, inventory impairment charges and potential impacts from inflation and interest rates present challenges that the company will need to navigate.