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Press release from PR Newswire

Standard Pacific Corp. Reports 2014 First Quarter Results

Thursday, May 01, 2014

Standard Pacific Corp. Reports 2014 First Quarter Results

16:02 EDT Thursday, May 01, 2014

Q1 2014 pretax income of $61.6 million, up 74% from Q1 2013
Q1 2014 backlog value of $1.0 billion, up 39% from Q1 2013

IRVINE, Calif., May 1, 2014 /PRNewswire/ --  Standard Pacific Corp. (NYSE: SPF) today announced results for the first quarter ended March 31, 2014.

2014 First Quarter Highlights and Comparisons to the 2013 First Quarter

  • Net income of $38.2 million, or $0.09 per diluted share, vs. $21.8 million, or $0.05 per diluted share
  • Pretax income of $61.6 million, up 74%
  • Net new orders of 1,311, down 6%; Dollar value of net new orders up 16%
  • Backlog of 2,016 homes, up 9%; Dollar value of backlog up 39%
  • 174 average active selling communities, up 10%
  • Home sale revenues of $446.9 million, up 26%
  • Average selling price of $449 thousand, up 20%
  • 995 new home deliveries, up 5%
  • Gross margin from home sales of 26.6%, compared to 21.0%
  • Operating margin from home sales of $60.1 million, or 13.4%, compared to $28.2 million, or 7.9%
  • $224.1 million of land purchases and development costs, compared to $124.4 million

Scott Stowell, the Company's Chief Executive Officer commented, "The strong operating performance we achieved during the last two years has continued into the first quarter, with pretax income, backlog value, home sale revenues and new order value up 74%, 39%, 26% and 16%, respectively."  Mr. Stowell added, "In addition to these solid results, I am particularly pleased with our operating margin from home sales, which was 13.4% for the 2014 first quarter, a 550 basis point improvement from the prior year."     

Revenues from home sales for the 2014 first quarter increased 26%, to $446.9 million, as compared to the prior year period, resulting primarily from a 20% increase in the Company's consolidated average home price to $449 thousand and a 5% increase in new home deliveries.  The increase in average home price was primarily attributable to general price increases within a majority of the Company's markets, a shift to more move-up product and a decrease in the use of sales incentives.  The increase in new home deliveries was driven by a 10% year-over-year increase in the number of homes in beginning backlog expected to close during the quarter. 

Gross margin from home sales for the 2014 first quarter increased to 26.6% compared to 21.0% in the prior year period.  The 560 basis point year-over-year increase was primarily attributable to price increases and a decrease in the use of sales incentives.  Excluding previously capitalized interest costs, gross margin from home sales was 32.0%* for the 2014 first quarter versus 28.8%* for the 2013 first quarter.    

While net new orders for the 2014 first quarter decreased 6% from the 2013 first quarter to 1,311 homes, the dollar value of these orders was up 16%.  The Company's monthly sales absorption rate was 2.5 per community for the 2014 first quarter, compared to 1.7 per community for the 2013 fourth quarter. The increase in sales absorption rate from the 2013 fourth quarter to the 2014 first quarter was above the seasonality we typically experience in our business. The Company's cancellation rate for the 2014 first quarter was 14%, compared to 21% for the 2013 fourth quarter.  Our 2014 first quarter cancellation rate was below our average historical cancellation rate of approximately 21% over the last 10 years.    

The dollar value of homes in backlog increased 39% to $1.0 billion, or 2,016 homes, compared to $719.7 million, or 1,851 homes, for the 2013 first quarter, and increased 25% compared to $800.5 million, or 1,700 homes, as of the end of 2013.  The increase in year-over-year backlog value was driven primarily by a 28% increase in the average selling price of the homes in backlog, reflecting the continued execution of our strategy to focus on the move-up buyer and pricing opportunities in select markets.

The Company purchased $144.7 million of land (2,190 homesites) during the 2014 first quarter, of which 34% (based on homesites) was located in Florida, 20% in Arizona, 19% in the Carolinas, 14% in California and 12% in Texas.  As of March 31, 2014, the Company owned or controlled 35,715 homesites, of which 23,783 are owned and actively selling or under development, 6,972 are controlled or under option, and the remaining 4,960 homesites are held for future development or for sale.  The homesites owned that are actively selling or under development represent a 5.1 year supply based on the Company's deliveries for the trailing twelve months ended March 31, 2014.

The Company ended the quarter with $635 million of available liquidity, including $195 million of unrestricted homebuilding cash and a $440 million untapped revolving credit facility. Cash used in operating activities was $117.6 million for the 2014 first quarter versus $58.5 million in the 2013 first quarter.  During the 2014 first quarter, the Company spent $224.1 million on land purchases and development costs, compared to $124.4 million for the 2013 first quarter.  The Company's homebuilding debt to book capitalization as of March 31, 2014 and 2013 was 54.9% and 54.4%, respectively, and adjusted net homebuilding debt to adjusted book capitalization was 51.7%* and 48.8%*, respectively.  In addition, the Company's homebuilding debt to adjusted homebuilding EBITDA for the LTM period ending March 31, 2014 and 2013 was 4.5x* and 6.8x*, respectively.

Earnings Conference Call

A conference call to discuss the Company's 2014 first quarter results will be held at 12:00 p.m. Eastern time May 2, 2014.  The call will be broadcast live over the Internet and can be accessed through the Company's website at http://ir.standardpacifichomes.com.  The call will also be accessible via telephone by dialing (877) 545-1414 (domestic) or (719) 325-4831 (international); Passcode: 8923683.  The audio transmission with the slide presentation will be available on our website for replay within 2 to 3 hours following the live broadcast, and can be accessed by dialing (888) 203-1112 (domestic) or (719) 457-0820 (international); Passcode: 8923683.

About Standard Pacific

Standard Pacific Homes (NYSE: SPF) has been building beautiful, high-quality homes and neighborhoods since its founding in Southern California in 1965.  With a trusted reputation for quality craftsmanship, an outstanding customer experience and exceptional architectural design, the Company utilizes its decades of land acquisition, development and homebuilding expertise to successfully navigate today's complex landscape to acquire and build desirable communities in locations that meet the high expectations of the Company's targeted move-up homebuyers.  Currently offering new homes in major metropolitan areas in Arizona, California, Colorado, Florida, North Carolina, South Carolina, and Texas, we invite you to learn more about us by visiting standardpacifichomes.com.

This news release contains forward-looking statements.  These statements include but are not limited to statements regarding new home orders, deliveries, backlog, absorption rates, average home price, pricing power, revenue, profitability, cash flow, liquidity, gross margin, overhead expenses and other costs; community count; product mix; the benefit of, and execution on, our strategy; supply; demand; our future performance and the future condition of the economy and the housing market.  Forward-looking statements are based on our current expectations or beliefs regarding future events or circumstances, and you should not place undue reliance on these statements.  Such statements involve known and unknown risks, uncertainties, assumptions and other factors many of which are out of the Company's control and difficult to forecast that may cause actual results to differ materially from those that may be described or implied.  Such factors include but are not limited to:  local and general economic and market conditions, including consumer confidence, employment rates, interest rates, the cost and availability of mortgage financing, and stock market, home and land valuations; the impact on economic conditions, terrorist attacks or the outbreak or escalation of armed conflict involving the United States; the cost and availability of suitable undeveloped land, building materials and labor; the cost and availability of construction financing and corporate debt and equity capital; our significant amount of debt and the impact of restrictive covenants in our debt agreements; our ability to repay our debt as it comes due; changes in our credit rating or outlook; the demand for and affordability of single-family homes; the supply of housing for sale; cancellations of purchase contracts by homebuyers; the cyclical and competitive nature of the Company's business; governmental regulation, including the impact of "slow growth" or similar initiatives; delays in the land entitlement process, development, construction, or the opening of new home communities; adverse weather conditions and natural disasters; environmental matters; risks relating to the Company's mortgage banking operations; future business decisions and the Company's ability to successfully implement the Company's operational and other strategies; litigation and warranty claims; and other risks discussed in the Company's filings with the Securities and Exchange Commission, including in the Company's Annual Report on Form 10-K for the year ended Dec. 31, 2013 and subsequent Quarterly Reports on Form 10-Q.  The Company assumes no, and hereby disclaims any, obligation to update any of the foregoing or any other forward-looking statements.  The Company nonetheless reserves the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this press release.  No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates.

Contact: Jeff McCall, EVP & CFO (949) 789-1655, jmccall@stanpac.com

*Please see "Reconciliation of Non-GAAP Financial Measures" at the end of this release.

 

(Note: Tables Follow)

 

 

 

KEY STATISTICS AND FINANCIAL DATA1

 

As of or For the Three Months Ended

March 31,

March 31,

Percentage

December 31,

Percentage

2014

2013

or % Change

2013

or % Change

Operating Data

(Dollars in thousands)

Deliveries

995

947

5%

1,343

(26%)

Average selling price

$

449

$

375

20%

$

446

1%

Home sale revenues

$

446,918

$

355,126

26%

$

598,496

(25%)

Gross margin % (including land sales)

25.8%

20.8%

5.0%

26.8%

(1.0%)

Gross margin % from home sales

26.6%

21.0%

5.6%

26.8%

(0.2%)

Gross margin % from home sales (excluding interest amortized to cost of home sales)*

32.0%

28.8%

3.2%

32.2%

(0.2%)

Incentive and stock-based compensation expense

$

5,028

$

4,848

4%

$

9,442

(47%)

Selling expenses

$

22,699

$

18,444

23%

$

28,114

(19%)

G&A expenses (excluding incentive and stock-based compensation expenses)

$

30,863

$

23,002

34%

$

30,304

2%

SG&A expenses

$

58,590

$

46,294

27%

$

67,860

(14%)

SG&A % from home sales

13.1%

13.0%

0.1%

11.3%

1.8%

Operating margin from home sales

$

60,083

$

28,220

113%

$

92,648

(35%)

Operating margin % from home sales

13.4%

7.9%

5.5%

15.5%

(2.1%)

Net new orders (homes)

1,311

1,394

(6%)

878

49%

Net new orders (dollar value)

$

633,818

$

548,561

16%

$

418,828

51%

Average active selling communities

174

158

10%

173

1%

Monthly sales absorption rate per community

2.5

2.9

(15%)

1.7

48%

Cancellation rate

14%

10%

4%

21%

(7%)

Gross cancellations

221

162

36%

234

(6%)

Cancellations from current quarter sales

90

86

5%

64

41%

Backlog (homes)

2,016

1,851

9%

1,700

19%

Backlog (dollar value)

$

1,001,385

$

719,651

39%

$

800,494

25%

Cash flows (uses) from operating activities

$

(117,563)

$

(58,461)

(101%)

$

(27,820)

(323%)

Cash flows (uses) from investing activities

$

10,286

$

(1,601)

$

(14,707)

Cash flows (uses) from financing activities

$

(50,902)

$

(180)

(28179%)

$

42,690

Land purchases (incl. seller financing and JV purchases)

$

144,744

$

71,541

102%

$

116,856

24%

Adjusted Homebuilding EBITDA*

$

89,008

$

63,823

39%

$

135,469

(34%)

Adjusted Homebuilding EBITDA Margin %*

19.3%

17.8%

1.5%

22.3%

(3.0%)

Homebuilding interest incurred

$

38,786

$

35,027

11%

$

37,546

3%

Homebuilding interest capitalized to inventories owned

$

38,213

$

34,201

12%

$

36,889

4%

Homebuilding interest capitalized to investments in JVs

$

573

$

826

(31%)

$

657

(13%)

Interest amortized to cost of sales (incl. cost of land sales)

$

24,983

$

27,885

(10%)

$

32,909

(24%)

As of 

March 31,

December 31,

Percentage

2014

2013

or % Change

Balance Sheet Data

(Dollars in thousands, except per share amounts)

Homebuilding cash (including restricted cash)

$

221,400

$

376,949

(41%)

Inventories owned

$

2,741,269

$

2,536,102

8%

Homesites owned and controlled

35,715

35,175

2%

Homes under construction

2,245

2,001

12%

Completed specs

368

327

13%

Deferred tax asset valuation allowance

$

4,591

$

4,591

?

Homebuilding debt

$

1,839,994

$

1,839,595

0%

Stockholders' equity

$

1,513,087

$

1,468,960

3%

Stockholders' equity per share (including if-converted preferred stock)*

$

4.13

$

4.02

3%

Total consolidated debt to book capitalization

55.6%

56.9%

(1.3%)

Adjusted net homebuilding debt to total adjusted book capitalization*

51.7%

49.9%

1.8%

1All statistical numbers exclude unconsolidated joint ventures unless noted otherwise.

*Please see "Reconciliation of Non-GAAP Financial Measures" at the end of this release.

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

 

Three Months Ended March 31,

2014

2013

(Dollars in thousands, except per share amounts)

(Unaudited)

Homebuilding:

Home sale revenues

$

446,918

$

355,126

Land sale revenues

13,281

2,595

Total revenues

460,199

357,721

Cost of home sales

(328,245)

(280,612)

Cost of land sales

(13,004)

(2,583)

Total cost of sales

(341,249)

(283,195)

Gross margin

118,950

74,526

Gross margin %

25.8%

20.8%

Selling, general and administrative expenses

(58,590)

(46,294)

Income (loss) from unconsolidated joint ventures

(437)

1,134

Other income (expense)

(13)

3,570

Homebuilding pretax income 

59,910

32,936

Financial Services:

Revenues

4,984

5,677

Expenses

(3,440)

(3,322)

Other income

161

102

Financial services pretax income

1,705

2,457

Income before taxes

61,615

35,393

Provision for income taxes

(23,456)

(13,569)

Net income 

38,159

21,824

  Less: Net income allocated to preferred shareholder

(9,147)

(8,903)

  Less: Net income allocated to unvested restricted stock

(59)

(22)

Net income available to common stockholders

$

28,953

$

12,899

Income Per Common Share:

Basic

$

0.10

$

0.06

Diluted

$

0.09

$

0.05

Weighted Average Common Shares Outstanding:

Basic

277,948,342

214,166,912

Diluted

315,894,969

252,947,416

Weighted average additional common shares outstanding if preferred shares converted to common shares

87,812,786

147,812,786

Total weighted average diluted common shares outstanding if preferred shares converted to common shares

403,707,755

400,760,202

 

 

CONDENSED CONSOLIDATED BALANCE SHEETS

 

March 31,

December 31,

2014

2013

(Dollars in thousands)

ASSETS

(Unaudited)

Homebuilding:

Cash and equivalents

$

194,702

$

355,489

Restricted cash

26,698

21,460

Trade and other receivables

31,896

14,431

Inventories:

Owned

2,741,269

2,536,102

Not owned

83,601

98,341

Investments in unconsolidated joint ventures

49,720

66,054

Deferred income taxes, net

354,478

375,400

Other assets

45,442

45,977

Total Homebuilding Assets

3,527,806

3,513,254

Financial Services:

Cash and equivalents

10,410

7,802

Restricted cash

1,295

1,295

Mortgage loans held for sale, net

70,093

122,031

Mortgage loans held for investment, net

13,165

12,220

Other assets

6,483

5,503

Total Financial Services Assets

101,446

148,851

Total Assets

$

3,629,252

$

3,662,105

LIABILITIES AND EQUITY

Homebuilding:

Accounts payable

$

37,147

$

35,771

Accrued liabilities

184,386

214,266

Secured project debt and other notes payable

6,015

6,351

Senior notes payable

1,833,979

1,833,244

Total Homebuilding Liabilities

2,061,527

2,089,632

Financial Services:

Accounts payable and other liabilities

2,141

2,646

Mortgage credit facilities

52,497

100,867

Total Financial Services Liabilities

54,638

103,513

Total Liabilities

2,116,165

2,193,145

Equity:

Stockholders' Equity:

Preferred stock, $0.01 par value; 10,000,000 shares 

    authorized; 267,829 shares issued and outstanding

    at March 31, 2014 and December 31, 2013

3

3

Common stock, $0.01 par value; 600,000,000 shares 

    authorized; 278,776,082 and 277,618,177 shares 

    issued and outstanding at March 31, 2014 and

    December 31, 2013, respectively

2,787

2,776

Additional paid-in capital

1,360,771

1,354,814

Accumulated earnings

149,526

111,367

Total Equity

1,513,087

1,468,960

Total Liabilities and Equity

$

3,629,252

$

3,662,105

 

INVENTORIES

March 31,

December 31,

2014

2013

(Dollars in thousands)

Inventories Owned:

(Unaudited)

     Land and land under development

$     1,841,551

$     1,771,661

     Homes completed and under construction

769,786

628,371

     Model homes

129,932

136,070

        Total inventories owned

$     2,741,269

$     2,536,102

Inventories Owned by Segment:

     California

$     1,237,357

$     1,182,520

     Southwest

678,499

603,303

     Southeast

825,413

750,279

        Total inventories owned

$     2,741,269

$     2,536,102

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

2014

2013

(Dollars in thousands)

(Unaudited)

Cash Flows From Operating Activities:

Net income

$

38,159

$

21,824

Adjustments to reconcile net income to net cash 

provided by (used in) operating activities:

Amortization of stock-based compensation

2,372

1,531

Deferred income tax provision

23,622

13,374

Other operating activities

1,616

1,412

Changes in cash and equivalents due to:

Trade and other receivables

(17,549)

(8,916)

Mortgage loans held for sale

51,938

140

Inventories - owned

(188,759)

(73,030)

Inventories - not owned

(8,165)

(4,940)

Other assets

(833)

1,829

Accounts payable

1,376

(1,578)

Accrued liabilities

(21,340)

(10,107)

Net cash provided by (used in) operating activities

(117,563)

(58,461)

Cash Flows From Investing Activities:

Investments in unconsolidated homebuilding joint ventures

(2,787)

(2,552)

Distributions of capital from unconsolidated joint ventures

14,808

1,320

Other investing activities

(1,735)

(369)

Net cash provided by (used in) investing activities

10,286

(1,601)

Cash Flows From Financing Activities:

Change in restricted cash

(5,238)

(662)

Principal payments on secured project debt and other notes payable

(890)

(7,093)

Net proceeds from (payments on) mortgage credit facilities

(48,370)

1,117

Proceeds from the exercise of stock options

3,596

6,458

Net cash provided by (used in) financing activities

(50,902)

(180)

Net increase (decrease) in cash and equivalents

(158,179)

(60,242)

Cash and equivalents at beginning of period

363,291

346,555

Cash and equivalents at end of period

$

205,112

$

286,313

Cash and equivalents at end of period

$

205,112

$

286,313

Homebuilding restricted cash at end of period

26,698

27,562

Financial services restricted cash at end of period

1,295

2,420

Cash and equivalents and restricted cash at end of period

$

233,105

$

316,295

 

REGIONAL OPERATING DATA

Three Months Ended March 31, 

2014

2013

% Change

New homes delivered:

California

339

400

(15%)

Arizona

63

63

      ?  

Texas

149

133

12%

Colorado

53

43

23%

Southwest

265

239

11%

Florida

235

183

28%

Carolinas

156

125

25%

Southeast

391

308

27%

Consolidated total

995

947

5%

Unconsolidated joint ventures

       ?   

14

(100%)

Total (including joint ventures)

995

961

4%

 

 

Three Months Ended March 31, 

2014

2013

% Change

(Dollars in thousands)

Average selling prices of homes delivered:

California

$

624

$

492

27%

Arizona

305

249

22%

Texas

415

348

19%

Colorado

484

400

21%

Southwest

403

331

22%

Florida

350

259

35%

Carolinas

298

254

17%

Southeast

329

257

28%

Consolidated

449

375

20%

Unconsolidated joint ventures

      ?  

510

?

Total (including joint ventures)

$

449

$

377

19%

 

 

Three Months Ended March 31,

2014

2013

% Change

Net new orders:

California

473

482

(2%)

Arizona

67

75

(11%)

Texas

235

242

(3%)

Colorado

53

62

(15%)

Southwest

355

379

(6%)

Florida

283

293

(3%)

Carolinas

200

240

(17%)

Southeast

483

533

(9%)

Consolidated total

1,311

1,394

(6%)

Unconsolidated joint ventures

        ?  

9

(100%)

Total (including joint ventures)

1,311

1,403

(7%)

 

Three Months Ended March 31,

2014

2013

% Change

Average number of selling communities 

  during the period:

California

46

44

5%

Arizona

11

8

38%

Texas

35

29

21%

Colorado

10

7

43%

Southwest

56

44

27%

Florida

41

37

11%

Carolinas

31

33

(6%)

Southeast

72

70

3%

Consolidated total

174

158

10%

 

At March 31,

2014

2013

% Change

Homes

Dollar Value

Homes

Dollar Value

Homes

Dollar Value

(Dollars in thousands)

Backlog:

California

530

$

360,371

522

$

284,033

2%

27%

Arizona

109

38,032

89

24,886

22%

53%

Texas

376

184,452

313

126,276

20%

46%

Colorado

108

55,930

94

42,374

15%

32%

Southwest

593

278,414

496

193,536

20%

44%

Florida

552

248,543

476

134,880

16%

84%

Carolinas

341

114,057

357

107,202

(4%)

6%

Southeast

893

362,600

833

242,082

7%

50%

Consolidated total

2,016

1,001,385

1,851

719,651

9%

39%

Unconsolidated joint ventures

           ?    

           ?    

7

3,241

(100%)

(100%)

Total (including joint ventures)

2,016

$

1,001,385

1,858

$

722,892

9%

39%

 

 

At March 31,

2014

2013

% Change

Homesites owned and controlled:

California

9,545

10,407

(8%)

Arizona

2,302

1,902

21%

Texas

4,555

5,165

(12%)

Colorado

1,254

1,174

7%

Nevada

1,124

1,124

          ?   

Southwest

9,235

9,365

(1%)

Florida

12,257

8,445

45%

Carolinas

4,678

3,906

20%

Southeast

16,935

12,351

37%

Total (including joint ventures)

35,715

32,123

11%

Homesites owned

28,743

25,689

12%

Homesites optioned or subject to contract 

6,707

5,837

15%

Joint venture homesites

265

597

(56%)

Total (including joint ventures)

35,715

32,123

11%

Homesites owned:

Raw lots

6,892

5,722

20%

Homesites under development

9,811

8,371

17%

Finished homesites

6,341

5,616

13%

Under construction or completed homes

3,198

2,583

24%

Held for sale

2,501

3,397

(26%)

Total

28,743

25,689

12%

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

Each of the below measures are non-GAAP financial measures and other companies may calculate such non-GAAP measures differently.  Due to the significance of the GAAP components excluded, such measures should not be considered in isolation or as an alternative to operating performance measures prescribed by GAAP.

The table set forth below reconciles the Company's gross margin percentage from home sales to the gross margin percentage from home sales, excluding interest amortized to cost of home sales.  We believe these measures are useful to management and investors as they provide perspective on the underlying operating performance of the business excluding these charges and provide comparability with the Company's peer group.

 

Three Months Ended

March 31, 2014

GrossMargin %

March 31,2013

GrossMargin %

December 31, 2013

GrossMargin %

(Dollars in thousands)

Home sale revenues

$

446,918

$

355,126

$

598,496

Less: Cost of home sales

(328,245)

(280,612)

(437,988)

Gross margin from home sales

118,673

26.6%

74,514

21.0%

160,508

26.8%

Add: Capitalized interest included in cost of home sales

24,368

5.4%

27,696

7.8%

32,378

5.4%

Gross margin from home sales, excluding interest amortized to cost of home sales

$

143,041

32.0%

$

102,210

28.8%

$

192,886

32.2%

The table set forth below reconciles the Company's total consolidated debt to adjusted net homebuilding debt and provides the Company's total consolidated debt to book capitalization and adjusted net homebuilding debt to total adjusted book capitalization ratios.  In addition, the table set forth below calculates homebuilding debt to adjusted homebuilding EBITDA.  We believe these ratios are useful to management and investors as a measure of the Company's ability to obtain financing.  For purposes of the ratio of adjusted net homebuilding debt to total adjusted book capitalization, total adjusted book capitalization is adjusted net homebuilding debt plus stockholders' equity.  Adjusted net homebuilding debt excludes indebtedness of the Company's financial services subsidiary and additionally reflects the offset of cash and equivalents. 

March 31,2014

December 31,2013

March 31,2013

(Dollars in thousands)

Total consolidated debt

$

1,892,491

$

1,940,462

$

1,628,846

Less:

Financial services indebtedness

(52,497)

(100,867)

(93,276)

Homebuilding cash

(221,400)

(376,949)

(308,029)

Adjusted net homebuilding debt

1,618,594

1,462,646

1,227,541

Stockholders' equity

1,513,087

1,468,960

1,287,207

Total adjusted book capitalization

$

3,131,681

$

2,931,606

$

2,514,748

Total consolidated debt to book capitalization

55.6%

56.9%

55.9%

Adjusted net homebuilding debt to total adjusted book capitalization

51.7%

49.9%

48.8%

Homebuilding debt

$

1,839,994

$

1,535,570

LTM adjusted homebuilding EBITDA

408,806

225,958

Homebuilding debt to adjusted homebuilding EBITDA

 4.5x 

 6.8x 

The table set forth below calculates pro forma stockholders' equity per common share.  The Company believes that the pro forma stockholders' equity per common share information is useful to management and investors as a measure to determine the book value per common share after giving effect to the conversion of our outstanding preferred shares assuming full conversion to common stock.

March 31,

December 31,

2014

2013

Actual common shares outstanding

278,776,082

277,618,177

Add: Conversion of preferred shares to common shares

87,812,786

87,812,786

Pro forma common shares outstanding

366,588,868

365,430,963

Stockholders' equity (Dollars in thousands)

$

1,513,087

$

1,468,960

Divided by pro forma common shares outstanding

÷

366,588,868

÷

365,430,963

Pro forma stockholders' equity per common share

$

4.13

$

4.02

The table set forth below calculates EBITDA and Adjusted Homebuilding EBITDA.  Adjusted Homebuilding EBITDA means net income (loss) (plus cash distributions of income from unconsolidated joint ventures) before (a) income taxes, (b) homebuilding interest expense (c) expensing of previously capitalized interest included in cost of sales, (d) impairment charges and deposit write-offs, (e) (gain) loss on early extinguishment of debt (f) homebuilding depreciation and amortization, (g) amortization of stock-based compensation, (h) income (loss) from unconsolidated joint ventures and (i) income (loss) from financial services subsidiary.  Other companies may calculate Adjusted Homebuilding EBITDA (or similarly titled measures) differently.  We believe Adjusted Homebuilding EBITDA information is useful to management and investors as one measure of the Company's ability to service debt and obtain financing.  Adjusted Homebuilding EBITDA is a non-GAAP financial measure and due to the significance of the GAAP components excluded, should not be considered in isolation or as an alternative to net income, cash flow from operations or any other operating or liquidity performance measure prescribed by GAAP.

 

Three Months Ended

LTM Ended March 31,

March 31,2014

March 31,2013

December 31,2013

2014

2013

(Dollars in thousands)

Net income 

$

38,159

$

21,824

$

64,820

$

205,050

$

544,722

Provision (benefit) for income taxes

23,456

13,569

36,205

78,870

(439,852)

Homebuilding interest amortized to cost of sales and interest expense

24,983

27,885

32,909

118,876

117,078

Homebuilding depreciation and amortization

1,145

628

1,094

3,972

2,410

Amortization of stock-based compensation

2,372

1,531

2,359

9,856

7,608

EBITDA

90,115

65,437

137,387

416,624

231,966

Add:

Cash distributions of income from unconsolidated joint ventures

       ?  

1,875

       ?  

1,500

5,785

Less:

Income (loss) from unconsolidated joint ventures

(437)

1,134

(300)

(622)

566

Income from financial services subsidiary

1,544

2,355

2,218

9,940

11,227

Adjusted Homebuilding EBITDA

$

89,008

$

63,823

$

135,469

$

408,806

$

225,958

Homebuilding revenues

$

460,199

$

357,721

$

606,451

$

2,017,087

$

1,370,977

Adjusted Homebuilding EBITDA Margin %

19.3%

17.8%

22.3%

20.3%

16.5%

The table set forth below reconciles net cash provided by (used in) operating activities, calculated and presented in accordance with GAAP, to Adjusted Homebuilding EBITDA:

 

Three Months Ended

LTM Ended March 31,

March 31,2014

March 31,2013

December 31,2013

2014

2013

(Dollars in thousands)

Net cash provided by (used in) operating activities

$

(117,563)

$

(58,461)

$

(27,820)

$

(213,318)

$

(299,459)

Add:

Provision (benefit) for income taxes

23,456

13,569

36,205

78,870

(439,852)

Deferred income tax benefit (provision)

(23,622)

(13,374)

(35,725)

(94,462)

440,626

Homebuilding interest amortized to cost of sales and interest expense

24,983

27,885

32,909

118,876

117,078

Less:

Income from financial services subsidiary

1,544

2,355

2,218

9,940

11,227

Depreciation and amortization from financial services subsidiary

33

28

32

126

120

Loss on disposal of property and equipment

1

15

1

3

52

Net changes in operating assets and liabilities:

Trade and other receivables

17,549

8,916

(5,218)

11,877

1,124

Mortgage loans held for sale

(51,938)

(140)

46,722

(49,255)

54,732

Inventories-owned

188,759

73,030

100,937

531,041

344,468

Inventories-not owned

8,165

4,940

11,619

46,544

33,864

Other assets

833

(1,829)

(564)

1,697

(3,419)

Accounts payable 

(1,376)

1,578

(6,470)

(16,279)

(1,124)

Accrued liabilities

21,340

10,107

(14,875)

3,284

(10,681)

Adjusted Homebuilding EBITDA

$

89,008

$

63,823

$

135,469

$

408,806

$

225,958

 

 

SOURCE Standard Pacific Corp.

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