Taylor Morrison Home Corp (TMHC) Reports Strong Q3 2023 Results
Taylor Morrison Home Corp (NYSE:TMHC) reported a net income of $171 million in Q3 2023, with an adjusted net income of $180 million.
The company delivered over 2,600 homes with a gross margin of 23.9%.
TMHC ended the quarter with a significant liquidity position of $1.6 billion.
The company's book value per share increased by 21% year-over-year to nearly $47.
Taylor Morrison Home Corp (NYSE:TMHC) announced its third-quarter results for 2023 on October 25, 2023. The company reported a net income of $171 million, or $1.54 per diluted share. The adjusted net income was $180 million, or $1.62 per diluted share, excluding the impact of an inventory impairment and charge related to an extinguishment of debt.
Performance Highlights
TMHC delivered over 2,600 homes in the third quarter, achieving a better-than-expected adjusted home closings gross margin of 23.9%. The company also increased its land investment, retired outstanding debt, and repurchased shares, ending the quarter with a significant liquidity position of $1.6 billion. This resulted in a 21% year-over-year increase in the company's book value per share to a new high of nearly $47.
Financial Overview
The company's total revenue for Q3 2023 was $1,675,545, a decrease of 17.6% compared to Q3 2022. Home closings revenue was $1,611,883, down by 18.7% from the same period last year. Home closings gross margin was $372,884, a decrease of 31.7% from Q3 2022. The SG&A expenses increased by 14.1% to $167,791.
Business Outlook
Despite the challenges, TMHC is raising its full-year guidance for home closings and adjusted home closings gross margin. The company's diversified consumer strategy and balanced product portfolio are expected to help manage market headwinds effectively.
Financial Tables Summary
As of September 30, 2023, TMHC had total assets of $8,436,918, with cash and cash equivalents amounting to $613,811. The total liabilities stood at $3,261,808, with total stockholders' equity at $5,175,110. The company's net homebuilding debt to capitalization ratio, a key measure of leverage, was not provided in the report.
Conclusion
Despite the temporary impact of last year's slower starts and sales activity, TMHC has demonstrated strong performance in Q3 2023. The company's focus on operating efficiencies and a diversified consumer strategy has contributed to its healthy core performance. Moving forward, TMHC aims to continue executing its core operating strategies to drive bottom-line results and returns.
This article first appeared on GuruFocus.
