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As of April 22, 2019 10:02 AM ET Minimum 20 minute delay.

STOCK QUOTE & CHART

Press Release

Century Communities Reports Fourth Quarter and Full Year 2018 Results

Company Release - 2/7/2019 4:05 PM ET

- Delivered Record Full Year Earnings and 16th Consecutive Year of Profitable Results -

- Home Sales Revenues Increased 24% to $640.2 Million for Fourth Quarter -

- Home deliveries grew 55% to a record 2,028 homes for Fourth Quarter -

GREENWOOD VILLAGE, Colo.--(BUSINESS WIRE)-- Century Communities, Inc. (NYSE:CCS), a leading national homebuilder, today announced financial results for its fourth quarter and full year ended December 31, 2018.

Fourth Quarter 2018 Highlights Compared to Fourth Quarter 2017

  • Adjusted net income increased 20% to $34.4 million, or $1.11 per diluted share and net income increased 52% to $26.2 million, or $0.85 per diluted share
  • Home sales revenues increased 24% to a record $640.2 million
  • Selling, general & administrative expense (“SG&A”) as a percent of home sales revenues improved by 80 basis points to 11.4%
  • Home deliveries grew 55% to a record 2,028 homes
  • Net new home contracts increased 32% to 1,221 homes
  • Backlog improved 65% to 2,181 homes
  • Backlog value increased 17% to $669.5 million

Dale Francescon, Co-Chief Executive Officer, stated, “2018 was another year of strong revenue growth and earnings acceleration for Century, leading to our 16th consecutive year of profitability. In the fourth quarter, we delivered 2,028 homes and generated $651.9 million in total revenues. That said, fourth quarter home deliveries and net new contracts were impacted by the industry-wide softening of homebuilding activity since mid-year 2018. Into 2019, we will continue to carefully monitor the homebuilding climate in each of our markets and pursue our disciplined growth strategy while taking advantage of our diversified national scale to achieve additional efficiencies in our business.”

Rob Francescon, Co-Chief Executive Officer, said, “During 2018, we grew our business into a top-10 U.S. homebuilder through strategic positioning in attractive markets, broader product offerings and sound investments with a focus on lower price points. Additionally, we made significant progress in the ramp up of our Financial Services business, with that segment growing full year pre-tax income over six times. While we are encouraged by our progress and positive long-term housing fundamentals in our markets, demand may remain muted in 2019 due to a variety of macro factors, including higher mortgage rates and tightening affordability. In response, we plan to continue to tailor our product offerings according to evolving demand trends, expand our Wade Jurney Homes’ brand and drive operational efficiencies.”

Fourth Quarter 2018 Results

Adjusted net income for the fourth quarter increased 20% to $34.4 million, or $1.11 per diluted share, as compared to $28.6 million, or $1.01 per diluted share, for the prior year quarter. Adjusted net income excludes the impact of one-time items associated with homebuilder acquisitions. Net income for the fourth quarter 2018 increased 52% to $26.2 million, or $0.85 per diluted share as compared to $17.2 million or $0.60 per diluted share for the prior year quarter.

Home sales revenues for the fourth quarter 2018 increased 24% to $640.2 million, compared to $516.5 million for the prior year quarter. The growth in home sales revenues was primarily due to a 55% increase in deliveries to 2,028 homes compared to 1,311 homes for the prior year quarter. Average sales price of home deliveries for the fourth quarter 2018 was $315,700, compared to $394,000 in the prior year quarter, consistent with the Company’s expansion of its offering of entry level homes.

Adjusted homebuilding gross margin percentage, excluding interest and purchase price accounting, was consistent with our expectations at 20.4% in the fourth quarter 2018, as compared to 21.7% in the prior year quarter. Homebuilding gross margin percentage in the fourth quarter 2018 was 16.5%, as compared to 17.6% in the prior year quarter. SG&A as a percent of home sales revenues improved to 11.4%, compared to 12.1% in the prior year quarter.

Net new home contracts in the fourth quarter 2018 increased 32% to 1,221 homes, compared to 922 homes in the prior year quarter, attributable to stronger demand trends within the Texas Region and the benefit of our Wade Jurney Homes acquisition, partly offset by softer demand trends in the Company’s other regions. At the end of the fourth quarter 2018, the Company had 2,181 homes in backlog, representing $669.5 million of backlog dollar value, compared to 1,320 homes in backlog, representing $572.9 million of backlog dollar value in the prior year quarter, an increase of 65% in units and 17% in dollar value.

Financial services generated pre-tax income of $3.3 million in the fourth quarter 2018 as compared to $1.1 million in the prior year quarter.

Full Year 2018 Results

Adjusted net income increased 69% to a record $119.9 million, or $3.94 per share, compared to $71.1 million, or $2.87 per share, for the prior year. Net income for the full year 2018 was $96.5 million, or $3.17 per share compared to $50.3 million, or $2.03 per share.

Home sales revenues for 2018 increased 50% to $2.1 billion, compared to $1.4 billion for 2017. The increase in home sales revenues was primarily due to home deliveries increasing 68% to 6,099 homes. On a pro forma basis, including Wade Jurney Homes for the entire year, our revenues and deliveries would have been $2.3 billion and 7,092, respectively. Average selling price of homes delivered decreased to $346,000 compared to $386,100 in the prior year, consistent with the Company’s expansion of its offering of entry level homes.

Adjusted homebuilding gross margin percentage, excluding purchase price accounting and interest in cost of home sales revenues, improved to 21.6% compared to 21.4% in the prior year. Homebuilding gross margin percentage in 2018 was 17.5%, compared to 17.9% in 2017. SG&A as a percent of home sales revenues remained constant at 12.5% compared to the prior year, with tight cost controls offsetting numerous investment initiatives to support growth objectives.

Net new home contracts in 2018 increased to 5,657 homes, an increase of 48%, compared to 3,814 homes in the prior year, largely attributable to a slightly higher community count and absorption pace.

At the end of full year 2018, the Company had 122 open communities in its Century Communities brand, compared to 119 open communities at the end of the prior year.

Financial services generated pre-tax income of $8.8 million in the full year 2018 as compared to $1.2 million in the prior year.

Balance Sheet and Liquidity

As of December 31, 2018, the Company had $387.5 million of availability under its credit facility.

During the fourth quarter, the Company repurchased 687,061 shares of its common stock at a weighted average price of $17.99 per share.

Full Year 2019 Outlook

David Messenger, Chief Financial Officer of the Company, commented, “We remain confident in our business and the long-term fundamentals in our markets. Into 2019, we will continue to focus on growing our presence in existing markets, expanding Wade Jurney Homes in existing and new markets, strengthening our balance sheet, and taking accretive actions to drive shareholder value. Given limited near-term visibility across the national housing market combined with uncertainty in the U.S. macroeconomic environment, we are not providing revenue and closing guidance for fiscal year 2019 at this time.

Conference Call

The Company will host a webcast and conference call on Thursday, February 7, 2019 at 5:00 p.m. Eastern time, 3:00 p.m. Mountain time, to review the Company’s fourth quarter and full year 2018 results, discuss recent events and conduct a question-and-answer period. To participate in the call, please dial 877-451-6152 (domestic) or 201-389-0879 (international). The live webcast will be available at www.centurycommunities.com in the Investors section. A replay of the conference call will be available through March 7, 2019, by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the pass code 13686574. A replay of the webcast will be available on the Company’s website through March 7, 2019.

About Century Communities

Century Communities, Inc. (NYSE:CCS) is a leading national U.S. homebuilder. Century is engaged in all aspects of homebuilding, including the acquisition, entitlement and development of land, along with the construction, innovative marketing and sale of quality homes designed to appeal to a wide range of homebuyers. The Colorado-based Company sells its Century Communities and Wade Jurney Homes in 15 states across the West, Mountain, Texas and Southeast U.S. regions and offers title, insurance, and lending services in select markets through its Parkway Title, IHL Insurance Agency, and Inspire Home Loan subsidiaries. To learn more about Century Communities please visit www.centurycommunities.com.

Non-GAAP Financial Measures

In addition to the Company’s operating results presented in accordance with generally accepted accounting principles (GAAP), this press release includes the following non-GAAP financial measures: Adjusted Diluted Earnings per Common Share (Adjusted EPS), Adjusted Homebuilding Gross Margin, Adjusted EBITDA, and Ratio of Homebuilding Net Debt to Net Capital. These non-GAAP financial measures should not be used as a substitute for the Company’s operating results presented in accordance with GAAP, and an analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. Please refer to the reconciliation of each of the above referenced non-GAAP financial measures following the historical financial information presented in this press release.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, as such, may involve known and unknown risks, uncertainties and assumptions. Forward-looking statements may be identified by the use of words such as “anticipate,” “believe,” “expect,” “estimate,” “plan,” “continue,” “outlook,” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements in this release include the company’s operating and financial guidance for 2018. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on historical information available at the time the statements are made and are based on management’s reasonable belief or expectations with respect to future events, and are subject to risks and uncertainties, many of which are beyond the Company’s control, that could cause actual performance or results to differ materially from the belief or expectations expressed in or suggested by the forward-looking statements. The following important factors could cause actual results to differ materially from those expressed in the forward-looking statement: adverse changes in general economic conditions, ability to identify and acquire desirable land, availability of financing, the effect of interest rate and tax changes, reliance on contractors, and the other factors included in the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date on which they are made and the Company undertakes no obligation to update any forward-looking statement to reflect future events, developments or otherwise, except as may be required by applicable law.

Century Communities, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

 

 

(in thousands, except share and per share amounts)

 
  Three months ended December 31,   Year ended December 31,
2018     2017   2018     2017  
Revenues
Home sales revenues $ 640,187 $ 516,501 $ 2,110,058 $ 1,405,443
Land sales and other revenues   1,327     2,289     5,631     8,503  
641,514 518,790 2,115,689 1,413,946
Financial services revenue   10,431     5,156     31,724     9,853  
Total revenues 651,945 523,946 2,147,413 1,423,799
Homebuilding Cost of Revenues
Cost of home sales revenues (534,695 ) (425,782 ) (1,741,619 ) (1,153,359 )
Cost of land sales and other revenues   (822 )   (1,522 )   (3,832 )   (6,516 )
(535,517 ) (427,304 ) (1,745,451 ) (1,159,875 )
Financial services costs (7,122 ) (4,016 ) (22,958 ) (8,664 )
Selling, general, and administrative (72,850 ) (62,707 ) (263,981 ) (176,304 )
Acquisition expense (41 ) (1,260 ) (437 ) (9,905 )
Equity in income of unconsolidated subsidiaries 4,528 14,849 12,176
Other income (expense)   (353 )   662     (905 )   2,937  
Income before income tax expense 36,062 33,848 128,530 84,164
Income tax expense   (9,868 )   (16,653 )   (32,075 )   (33,869 )
Net income $ 26,194   $ 17,195   $ 96,455   $ 50,295  
 
Earnings per share:
Basic $ 0.85 $ 0.61 $ 3.20 $ 2.06
Diluted $ 0.85 $ 0.60 $ 3.17 $ 2.03
Weighted average common shares outstanding:
Basic 30,675,586 27,967,797 30,084,913 24,280,871
Diluted 30,991,715 28,355,559 30,391,346 24,555,509

Century Communities, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

 

 

(in thousands, except share amounts)

 
  December 31,   December 31,
2018 2017
Assets
Cash and cash equivalents $ 32,902 $ 88,832
Cash held in escrow 24,344 37,723
Accounts receivable 13,464 12,999
Inventories 1,848,243 1,390,354
Mortgage loans held for sale 114,074 52,327
Prepaid expenses and other assets 138,717 60,812
Property and equipment, net 33,258 27,911
Investment in unconsolidated subsidiaries 28,208
Deferred tax assets, net 13,763 5,555
Amortizable intangible assets, net 5,095 2,938
Goodwill   30,395   27,363
Total assets $ 2,254,255 $ 1,735,022
Liabilities and stockholders' equity
Liabilities:
Accounts payable $ 89,907 $ 24,831
Accrued expenses and other liabilities 213,157 150,356
Notes payable 784,777 776,283
Revolving line of credit 202,500
Mortgage repurchase facilities   104,555   48,319
Total liabilities   1,394,896   999,789
Stockholders' equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none outstanding
Common stock, $0.01 par value, 100,000,000 shares authorized, 30,154,791 and 29,502,624 shares issued and outstanding at December 31, 2018 and December 31, 2017, respectively 302 295
Additional paid-in capital 595,037 566,790
Retained earnings   264,020   168,148
Total stockholders' equity   859,359   735,233
Total liabilities and stockholders' equity $ 2,254,255 $ 1,735,022

Century Communities, Inc.

Homebuilding Operational Data

 

Net New Home Contracts

         
Three Months Ended
December 31,
2018 2017 % Change
West 138 182 (24.2 ) %
Mountain 258 301 (14.3 ) %
Texas 161 117 37.6 %
Southeast 244 322 (24.2 ) %
Wade Jurney Homes 420 NM    
Total 1,221 922 32.4   %
 
Year ended
December 31,
2018 2017 % Change
West 754 296 154.7 %
Mountain 1,571 1,591 (1.3 ) %
Texas 654 477 37.1 %
Southeast 1,693 1,450 16.8 %
Wade Jurney Homes 985 NM    
Total 5,657 3,814 48.3   %
 

NM – Not meaningful

Home Deliveries

 

           

(dollars in thousands)

 
Three months ended December 31,
2018 2017 % Change    
Homes Average Sales Price Homes Average Sales Price Homes Average Sales Price
West 200 $ 524.9 247 $ 554.7 (19.0 ) % (5.4 ) %
Mountain 484 438.2 419 410.4 15.5 % 6.8 %
Texas 197 282.3 147 353.3 34.0 % (20.1 ) %
Southeast 510 333.7 498 312.5 2.4 % 6.8 %
Wade Jurney Homes 637   152.8   NM     NM    
Total / Weighted Average 2,028 $ 315.7 1,311 $ 394.0 54.7   % (19.9 ) %
 
Year ended December 31,
2018 2017 % Change    
Homes Average Sales Price Homes Average Sales Price Homes Average Sales Price
West 806 $ 569.5 398 $ 529.4 102.5 % 7.6 %
Mountain 1,625 $ 429.3 1,465 $ 418.0 10.9 % 2.7 %
Texas 688 $ 309.4 413 $ 389.6 66.6 % (20.6 ) %
Southeast 1,603 $ 331.0 1,364 $ 309.0 17.5 % 7.1 %
Wade Jurney Homes 1,377 $ 152.5 $ NM     NM    
Total / Weighted Average 6,099 $ 346.0 3,640 $ 386.1 67.6   % (10.4 ) %
 

NM – Not meaningful

 

Century Communities, Inc.

Homebuilding Operational Data

 

Selling Communities

           
 
Selling communities at period end As of December 31, Increase/(Decrease)
2018 2017 Amount % Change
 
West 17 19 (2 ) (10.5 ) %
Mountain 38 33 5 15.2 %
Texas 21 27 (6 ) (22.2 ) %
Southeast 46 40 6 15.0 %
Wade Jurney Homes N/A N/A N/A   N/A    
Total 122 119 3   2.5   %
 

N/A – Not applicable

 

Backlog

                 
 

(dollars in thousands)

 
December 31,
2018 2017 % Change    
Homes Dollar Value Average Sales Price Homes Dollar Value Average Sales Price Homes Dollar Value Average Sales Price
West 218 $ 120,042 $ 550.7 270 $ 164,071 $ 607.7 (19.3 ) % (26.8 ) % (9.4 ) %
Mountain 401 183,938 $ 458.3 455 200,887 $ 441.2 (11.9 ) % (8.4 ) % 3.9 %
Texas 181 68,265 $ 377.2 215 82,886 $ 385.5 (15.8 ) % (17.6 ) % (2.2 ) %
Southeast 470 156,491 $ 333.0 380 125,044 $ 329.1 23.7 % 25.1 % 1.2 %
Wade Jurney Homes 911   140,790 $ 154.5   $ NM     NM     NM    
Total / Weighted Average 2,181 $ 669,526 $ 306.9 1,320 $ 572,888 $ 434.0 65.2   % 16.9   % (29.3 ) %
 

NM – Not meaningful

 

Lot Inventory

                 
 
December 31,
2018 2017 % Change    
 
Owned Controlled Total Owned Controlled Total Owned Controlled Total
 
West 3,457 1,790 5,247 3,742 3,179 6,921 (7.6 ) % (43.7 ) % (24.2 ) %
Mountain 5,335 5,641 10,976 4,666 4,856 9,522 14.3 % 16.2 % 15.3 %
Texas 3,943 2,616 6,559 2,517 3,489 6,006 56.7 % (25.0 ) % 9.2 %
Southeast 4,828 2,808 7,636 4,827 3,508 8,335 0.0 % (20.0 ) % (8.4 ) %
Wade Jurney Homes 3,447 4,054 7,501 NM     NM     NM    
Total 21,010 16,909 37,919 15,752 15,032 30,784 33.4   % 12.5   % 23.2   %
 

NM – Not meaningful

 

Century Communities, Inc.
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Adjusted Diluted Earnings per Common Share (Adjusted EPS) is a non-GAAP financial measure that we believe is useful to management, investors and other users of the Company’s financial information in evaluating its operating results and understanding its operating trends without the effect of certain non-recurring items. The Company believes excluding certain non-recurring items provides more comparable assessment of its financial results from period to period. Adjusted Diluted EPS is calculated by excluding the effect of acquisition costs and purchase price accounting for acquired work in process from the calculation of reported EPS.

Adjusted Diluted Earnings Per Common Share

 

 

(in thousands, except share and per share amounts)

 
  Three Months Ended   Year ended
December 31, December 31,
2018     2017   2018     2017  
Numerator
Net income $ 26,194 $ 17,195 $ 96,455 $ 50,295
Less: Undistributed earnings allocated to participating securities       (85 )   (59 )   (384 )
Net income allocable to common stockholders $ 26,194   $ 17,110   $ 96,396   $ 49,911  
Denominator
Weighted average common shares outstanding - basic 30,675,586 27,967,797 30,084,913 24,280,871
Dilutive effect of restricted stock units   316,129     387,762   306,433   274,638  
Weighted average common shares outstanding - diluted   30,991,715     28,355,559   30,391,346   24,555,509  
Earnings per share:
Basic $ 0.85 $ 0.61 $ 3.20 $ 2.06
Diluted $ 0.85 $ 0.60 $ 3.17 $ 2.03
 
Adjusted earnings per share
Numerator
Income before income tax expense $ 36,062 $ 33,848 $ 128,530 $ 84,164
Purchase price accounting for acquired work in process inventory 9,746 9,295 38,112 15,625
Gain on previously held interest in WJH - - (7,219 ) -
Acquisition expense   41     1,260     437     9,905  
Adjusted income before income tax expense 45,849 44,403 159,860 109,694
Adjusted income tax expense(1)   (11,462 )   (15,630 )   (39,965 )   (38,612 )
Adjusted net income 34,387 28,773 119,895 71,082
Less: Adjusted undistributed earnings allocated to participating securities       (141 )   (74 )   (543 )
Adjusted net income allocable to common stockholders $ 34,387   $ 28,632   $ 119,821   $ 70,539  
 
Denominator - Diluted 30,991,715 28,355,559 30,391,346 24,555,509
 
Adjusted diluted earnings per share $ 1.11 $ 1.01 $ 3.94 $ 2.87

(1) For the three months and year ended December 31, 2018, the tax rate used in adjusted net income was 25%. This rate is inclusive of our estimated annual rate offset by certain discrete items not associated with acquisitions. For the three months and year ended December 31, 2017, the Company’s GAAP tax rate was utilized.

Century Communities, Inc.
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory is not a measurement of financial performance under United States generally accepted accounting principles; however, the Company’s management believes that this information is meaningful as it isolates the impact that indebtedness and acquisitions have on homebuilding gross margin and permits the Company’s stockholders to make better comparisons with the Company’s competitors, who adjust gross margins in a similar fashion. This non-GAAP financial measure should not be used as a substitute for the Company’s operating results. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.

Adjusted Homebuilding Gross Margin

(in thousands)

 
  Three months ended December 31,
2018     %   2017     %
 
Home sales revenues $ 640,187 100.0 % $ 516,501 100.0 %
Cost of home sales revenues   (534,695 ) (83.5 ) %   (425,782 ) (82.4 ) %
Gross margin from home sales 105,492 16.5 % 90,719 17.6 %
Add: Interest in cost of home sales revenues   15,115   2.4   %   12,274   2.4   %
Adjusted homebuilding gross margin excluding interest 120,607 18.8 % 102,993 19.9 %
Add: Purchase price accounting for acquired work in process inventory   9,746   1.5   %   9,295   1.8   %
Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory $ 130,353   20.4   % $ 112,288   21.7   %
 
 
Year ended December 31,
2018   % 2017   %
 
Home sales revenues $ 2,110,058 100.0 % $ 1,405,443 100.0 %
Cost of home sales revenues   (1,741,619 ) (82.5 ) %   (1,153,359 ) (82.1 ) %
Gross margin from home sales 368,439 17.5 % 252,084 17.9 %
Add: Interest in cost of home sales revenues   48,692   2.3   %   32,898   2.3   %
Adjusted homebuilding gross margin excluding interest 417,131 19.8 % 284,982 20.3 %
Add: Purchase price accounting for acquired work in process inventory   38,112   1.8   %   15,625   1.1   %
Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory $ 455,243   21.6   % $ 300,607   21.4   %

Century Communities, Inc.
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Adjusted EBITDA

Adjusted EBITDA is a non-GAAP financial measure we use as a supplemental measure in evaluating operating performance. The Company defines adjusted EBITDA as consolidated net income before (i) income tax expense, (ii) interest in cost of home sales revenues, (iii) other interest expense, (iv) depreciation and amortization expense, and (v) adjustments resulting from the application of purchase accounting for acquired work in process inventory related to business combinations. The Company believes adjusted EBITDA provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, and items considered to be non-recurring. Accordingly, the Company’s management believes that this measurement is useful for comparing general operating performance from period to period. Adjusted EBITDA should be considered in addition to, and not as a substitute for, consolidated net income in accordance with GAAP as a measure of performance. The Company’s presentation of adjusted EBITDA should not be construed as an indication that its future results will be unaffected by unusual or non-recurring items. Adjusted EBITDA is limited as an analytical tool, and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.

(in thousands)

               
 
Three months ended December 31, Year ended December 31,  
2018 2017   % Change 2018 2017   % Change
Net income $ 26,194 $ 17,195 52.3 % $ 96,455 $ 50,295 91.8 %
Income tax expense 9,868 16,653 (40.7 ) % 32,075 33,869 (5.3 ) %
Interest in cost of home sales revenues 15,115 12,274 23.1 % 48,692 32,898 48.0 %
Interest expense (income) 1( (5 ) (120.0 ) % 3( (3 ) (200.0 ) %
Depreciation and amortization expense   3,228   1,900     69.9   %   12,031   6,973     72.5   %
EBITDA 54,406 48,017 13.3 % 189,256 124,032 52.6 %
Purchase price accounting for acquired work in process inventory 9,746 9,295 4.9 % 38,112 15,625 143.9 %
Purchase price accounting for investment in unconsolidated subsidiaries outside basis 30 (100.0 ) % 60 915 (93.4 ) %
Acquisition expense   41   1,260     (96.7 ) %   437   9,905     (95.6 ) %
Adjusted EBITDA $ 64,193 $ 58,602     9.5   % $ 227,865 $ 150,477     51.4   %

Century Communities, Inc.
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Ratio of Net Homebuilding Debt to Net Capital

The following table presents the Company’s ratio of net homebuilding debt to net capital, which is a non-GAAP financial measure. The Company calculates this by dividing net homebuilding debt (senior notes payable and revolving line of credit less cash held in escrow and cash and cash equivalents) by net capital (net homebuilding debt plus total stockholders’ equity). The most directly comparable GAAP measure is the ratio of debt to capital. The Company believes the ratio of net homebuilding debt to net capital is a relevant and useful financial measure to investors in understanding the leverage employed in its operations and as an indicator of the Company’s ability to obtain external financing.

(in thousands)

   
December 31, December 31,
2018   2017  
Total homebuilding debt $ 987,277 $ 776,283
Total stockholders' equity   859,359     735,233  
Total capital $ 1,846,636   $ 1,511,516  
Debt to capital   53.5 %   51.4 %
 
Total homebuilding debt $ 987,277 $ 776,283
Cash and cash equivalents (32,902 ) (88,832 )
Cash held in escrow   (24,344 )   (37,723 )
Net homebuilding debt 930,031 649,728
Total stockholders' equity   859,359     735,233  
Net capital $ 1,789,390   $ 1,384,961  
 
Net homebuilding debt to net capital   52.0 %   46.9 %

Investor Relations:
303-268-8398
InvestorRelations@CenturyCommunities.com

Source: Century Communities, Inc.

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