Housing Bubble
Toll Brothers report record earnings and revenues for Q2
May 29, 2003
HUNTINGDON VALLEY, Pa., /PRNewswire-FirstCall/ -- Toll Brothers, Inc., (NYSE:TOL) , the nation's leading builder of luxury homes, today reported record earnings and revenues for the second quarter and six-month periods ended April 30, 2003. The Company's net income, of $52.9 million, ($0.72 per share diluted), and revenues of $607.9 million were second quarter records. The value of the Company's second quarter contracts of $926.5 million and its quarter-end backlog of $2.21 billion were the highest for any quarter in the Company's history.
Robert I. Toll, chairman and chief executive officer, stated: "We believe the start of the selling season was delayed due to concerns about war and weather, which muted activity in February and March. This delay has given way to strong demand in April and May. The past four weeks have been among the best in our history for traffic and reservation deposits. These are leading indicators for future contracts and, ultimately, ten to twelve months down the road, for deliveries and revenues. If the economy improves, notwithstanding an increase in interest rates, we believe our prospects will be even brighter."
"Our team produced record earnings despite the winter weather. Based on our backlog, combined with our record first six months' results, we believe we will produce record earnings in both the third and fourth quarters and for the full fiscal year 2003."
"Our expansion program continues with a record 176 selling communities today and a projected 185 selling communities by FYE 2003. Our record backlog already contains a large portion of first quarter 2004 deliveries. If the market remains as it is, we believe we will deliver at least $3 billion in home building revenues in 2004."
TOLL BROTHERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
(Unaudited)
Six months ended Three months ended
April 30, April 30,
2003 2002 2003 2002
Revenues:
Housing sales $ 1,158,863 $1,021,813 $ 600,977 $ 539,111
Land sales 13,387 14,041 3,953 7,618
Equity earnings (loss)
from unconsolidated
entities 145 1,497 (108) 1,497
Interest and other 5,797 5,324 3,110 2,270
1,178,192 1,042,675 607,932 550,496
Costs and expenses:
Housing sales 842,406 740,063 437,234 388,638
Land sales 10,717 9,178 3,103 4,961
Selling, general and
administrative
expenses 133,138 110,992 67,515 58,594
Interest 32,505 29,632 16,464 15,477
Expenses related
to early retirement
of debt 3,890
1,022,656 889,865 524,316 467,670
Income before
income taxes 155,536 152,810 83,616 82,826
Income taxes 57,257 55,806 30,751 30,316
Net income $98,279 $97,004 $52,865 $52,510
Earnings per share:
Basic $1.40 $1.38 $0.76 $0.74
Diluted $1.33 $1.29 $0.72 $0.69
Weighted average number
of shares:
Basic 70,133 70,425 69,859 70,849
Diluted 73,955 75,241 73,601 76,237
Additional information:
Interest incurred $51,031 $45,242 $25,249 $22,607
Depreciation and
amortization $5,928 $5,363 $2,883 $2,460
PERIOD ENDING APRIL 30:
UNITS $ (MILL)
2nd Qtr. 2nd Qtr. 2nd Qtr. 2nd Qtr.
CLOSINGS 2003 2002 2003 2002
------------------------------------ ------- ------- ------- -------
Northeast (MA, RI, NH, CT, NY, NJ) 164 213 96.0 107.4
Mid-Atlantic (PA, DE, MD, VA) 389 353 189.3 160.6
Mid-West (MI, IL, OH) 79 104 42.8 45.7
Southeast (FL, NC, TN) 182 159 76.6 61.7
Southwest (AZ, TX, NV, CO) 170 138 86.4 74.0
West Coast (CA) 125 119 109.9 89.7
Total 1,109 1,086 601.0 539.1
CONTRACTS (1)
---------------------------
Northeast (MA, RI, NH, CT, NY, NJ) 316 259 176.1 152.2
Mid-Atlantic (PA, DE, MD, VA) 648 662 314.9 304.3
Mid-West (MI, IL, OH) 126 124 66.6 63.7
Southeast (FL, NC, TN) 159 272 83.8 114.7
Southwest (AZ, TX, NV, CO) 204 190 125.1 95.8
West Coast (CA) 214 199 160.0 171.6
Total 1,667 1,706 926.5 902.3
BACKLOG (1)
---------------------------
Northeast (MA, RI, NH, CT, NY, NJ) 785 664 454.5 367.9
Mid-Atlantic (PA, DE, MD, VA) 1,449 1,133 709.9 528.2
Mid-West (MI, IL, OH) 327 291 177.5 143.8
Southeast (FL, NC, TN) 313 425 194.1 207.0
Southwest (AZ, TX, NV, CO) 618 401 336.5 205.7
West Coast (CA) 445 357 342.3 316.6
Total 3,937 3,271 2,214.8 1,769.2
PERIOD ENDING APRIL 30:
UNITS $ (MILL)
6 Months 6 Months 6 Months 6 Months
CLOSINGS 2003 2002 2003 2002
------------------------------------ ------- ------- ------- -------
Northeast (MA, RI, NH, CT, NY, NJ) 332 436 195.2 223.0
Mid-Atlantic (PA, DE, MD, VA) 768 681 371.8 314.1
Mid-West (MI, IL, OH) 166 216 86.3 100.8
Southeast (FL, NC, TN) 345 290 149.9 114.3
Southwest (AZ, TX, NV, CO) 300 247 153.8 131.3
West Coast (CA) 234 195 201.9 138.3
Total 2,145 2,065 1,158.9 1,021.8
CONTRACTS (1)
----------------------------
Northeast (MA, RI, NH, CT, NY, NJ) 457 449 265.0 260.3
Mid-Atlantic (PA, DE, MD, VA) 1,083 981 534.3 450.1
Mid-West (MI, IL, OH) 220 202 116.4 101.3
Southeast (FL, NC, TN) 274 387 139.5 169.9
Southwest (AZ, TX, NV, CO) 382 306 221.7 149.4
West Coast (CA) 317 309 235.8 256.4
Total 2,733 2,634 1,512.7 1,387.4
(1) Contracts for the three-month and six-month periods ended April 30,
2003 included $2.4 million (8 homes) and $5.5 million (18 homes),
respectively, from an unconsolidated 50% owned joint venture.
Contracts for the three-month and six-month periods ended April 30,
2002 included $2.8 million (8 homes) and $4.6 million (14 homes),
respectively, from this joint venture. Backlog as of April 30, 2003
and 2002 included $7.7 million (25 homes) and $4.6 million
(14 homes), respectively, from this joint venture.
Source: Toll Brothers, Inc.
