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D.R. Horton reported a strong fiscal Q1 2021, with net income rising 84% to $791.8 million, translating to $2.14 per share. Consolidated revenues increased by 48% to $5.9 billion, while pre-tax income surged 98%, reaching $1 billion. Home closings leaped 45% to 18,739 homes, and net sales orders jumped 56% to 20,418 homes valued at $6.4 billion. The company noted a cancellation rate of 18% and a backlog of 28,487 homes valued at $8.9 billion. Overall, the results reflect strong operational performance amidst favorable housing market conditions.
Positive
Net income increased 84% to $791.8 million.
Consolidated revenues rose 48% to $5.9 billion.
Pre-tax income surged 98% to $1.0 billion.
Homes closed increased 45% to 18,739.
Net sales orders up 56% to 20,418 homes.
Negative
Cancellation rate stood at 18%, slightly higher than the previous year.
D.R. Horton, Inc. (NYSE:DHI):
Fiscal 2021 First Quarter Highlights - comparisons to the prior year quarter
Net income attributable to D.R. Horton increased 84% to $791.8 million or $2.14 per diluted share
Consolidated revenues increased 48% to $5.9 billion
Consolidated pre-tax income increased 98% to $1.0 billion
Consolidated pre-tax profit margin improved 440 basis points to 17.4%
Homes closed increased 45% to 18,739 homes and 48% in value to $5.7 billion
Net sales orders increased 56% to 20,418 homes and 62% in value to $6.4 billion
D.R. Horton, Inc. (NYSE:DHI), America’s Builder, today reported that net income per common share attributable to D.R. Horton for its first fiscal quarter ended December 31, 2020 increased 84% to $2.14 per diluted share compared to $1.16 per diluted share in the same quarter of fiscal 2020. Net income attributable to D.R. Horton in the first quarter of fiscal 2021 increased 84% to $791.8 million compared to $431.3 million in the same quarter of fiscal 2020. The prior year period results included an income tax benefit of $29.3 million related to federal energy efficient homes tax credits that were retroactively reinstated in early fiscal 2020. Homebuilding revenue for the first quarter of fiscal 2021 increased 47% to $5.7 billion from $3.9 billion in the same quarter of fiscal 2020. Homes closed in the quarter increased 45% to 18,739 homes compared to 12,959 homes closed in the same quarter of fiscal 2020.
Net sales orders for the first quarter ended December 31, 2020 increased 56% to 20,418 homes and 62% in value to $6.4 billion compared to 13,126 homes and $3.9 billion in the same quarter of the prior year. The Company’s cancellation rate (cancelled sales orders divided by gross sales orders) for the first quarter of fiscal 2021 was 18% compared to 20% in the prior year quarter. The Company's sales order backlog of homes under contract at December 31, 2020 increased 107% to 28,487 homes and 111% in value to $8.9 billion compared to 13,780 homes and $4.2 billion at December 31, 2019.
At December 31, 2020, the Company had 42,100 homes in inventory, of which 16,300 were unsold. 1,600 of the Company’s unsold homes at December 31, 2020 were completed. The Company’s homebuilding land and lot portfolio totaled 440,700 lots at the end of the quarter, of which 28% were owned and 72% were controlled through land purchase contracts.
The Company's return on equity (ROE) was 24.4% for the trailing twelve months ended December 31, 2020, and homebuilding return on inventory (ROI) was 28.0% for the same period. ROE is calculated as net income attributable to D.R. Horton for the trailing twelve months divided by average stockholders' equity, where average stockholders' equity is the sum of ending stockholders' equity balances of the trailing five quarters divided by five. Homebuilding ROI is calculated as homebuilding pre-tax income for the trailing twelve months divided by average inventory, where average inventory is the sum of ending homebuilding inventory balances for the trailing five quarters divided by five.
The Company ended the first quarter with $2.1 billion of unrestricted homebuilding cash and $1.8 billion of available capacity on its revolving credit facilities for total homebuilding liquidity of $3.9 billion. Homebuilding debt at December 31, 2020 totaled $2.6 billion. The Company’s homebuilding debt to total capital ratio at December 31, 2020 was 17.3%. Homebuilding debt to total capital consists of homebuilding notes payable divided by stockholders’ equity plus homebuilding notes payable.
Donald R. Horton, Chairman of the Board, said, “The D.R. Horton team delivered outstanding results in the first fiscal quarter of 2021, including a 98% increase in consolidated pre-tax income to over $1.0 billion, a 48% increase in revenues to $5.9 billion and a 56% increase in net sales orders to 20,418 homes. Our pre-tax profit margin for the quarter improved 440 basis points to 17.4%, while our earnings increased 84% to $2.14 per diluted share. These results reflect the strength of our experienced operational teams, industry-leading market share, broad geographic footprint and diverse product offerings across multiple brands.
“We appreciate the continued efforts of our operational teams who are providing new homes to families across the United States during the COVID-19 pandemic. Our priority continues to be the health and safety of our employees, customers, trade partners and the communities we serve.
“Housing market conditions remain very strong, and we are focused on maximizing returns and improving capital efficiency in each of our communities while increasing our market share. Our strong balance sheet, ample liquidity and low leverage provide us with flexibility to operate effectively through changing economic conditions, and we plan to maintain our disciplined approach to investing capital
FAQ
What were D.R. Horton's earnings for Q1 fiscal 2021?
D.R. Horton's earnings for Q1 fiscal 2021 were $791.8 million, or $2.14 per diluted share, an increase of 84% year-over-year.
How did D.R. Horton's revenue perform in the first quarter of 2021?
D.R. Horton's consolidated revenue for Q1 2021 increased by 48% to $5.9 billion compared to the same period last year.
What is the status of D.R. Horton's sales orders for Q1 2021?
In Q1 2021, D.R. Horton reported a 56% increase in net sales orders, totaling 20,418 homes valued at $6.4 billion.
What was D.R. Horton's pre-tax profit margin in Q1 2021?
D.R. Horton's pre-tax profit margin improved by 440 basis points to 17.4% during Q1 2021.
How many homes are in D.R. Horton's backlog as of Q1 2021?
As of the end of Q1 2021, D.R. Horton had a backlog of 28,487 homes valued at $8.9 billion.
