Beazer Homes USA Inc (BZH) Q4 2024 Earnings Call Highlights: Strong Community Growth Amid ...

GuruFocus News
5 min read

In This Article:

  • Land and Land Development Investment: Over $750 million, up nearly 36% from the prior year.

  • Active Communities: Ended the year with 162 active communities, up about 20% year over year.

  • Adjusted EBITDA: $243 million.

  • Earnings Per Share (EPS): $4.53.

  • Community Count Growth Expectation: Full year average community count expected to increase by 18 to 22 communities.

  • Revenue Growth Expectation: More than 10% top line growth anticipated.

  • Spec Sales: Expected to represent more than 60% of closings, the highest level in a decade.

  • First Quarter Home Closings: Expected to close more than 925 homes with an average selling price (ASP) of around $515,000.

  • Adjusted Gross Margin: Expected to be around 19% for the first quarter.

  • SG&A as Percentage of Revenue: Expected to be around 13% for the first quarter.

  • Adjusted EBITDA for First Quarter: Expected to be about $30 million.

  • Effective Tax Rate: Approximately 15% for the first quarter.

  • Full Year Gross Margin Expectation: Between 19.5% and 20.5%.

  • Average Selling Price (ASP) Expectation: Over $530,000 for the full year.

  • SG&A Percentage for Full Year: Expected to be about 11%.

  • Total Liquidity: Exceeding $500 million at the end of the fiscal year.

  • Net Debt to Net Capitalization: Expected to be in the low to mid-30s by the end of fiscal 2025.

  • Land Spend Expectation for 2025: Around $850 million.

  • Owned and Option Lot Position: Expected to exceed 30,000 lots in 2025.

Release Date: November 13, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Beazer Homes USA Inc (NYSE:BZH) invested over $750 million in land and land development, increasing active communities by 20% year-over-year.

  • The company achieved $243 million in adjusted EBITDA and earnings per share of $4.53, delivering double-digit returns on both capital employed and equity.

  • Beazer Homes USA Inc (NYSE:BZH) accelerated its adoption of Zero Energy Ready building practices, becoming a leader in the DOE's national single-family program.

  • The company reached the top spot for customer experience among homebuilders according to TrustBuilder.

  • Beazer Homes USA Inc (NYSE:BZH) maintained its position as an employer of choice, receiving recognition for culture and employee engagement from multiple organizations.

Negative Points

  • The macro environment for new home sales was challenging, with stretched affordability and high mortgage rates impacting sales.

  • The company had to lower prices and increase incentives in certain markets to improve sales pace, which affected margins.

  • Beazer Homes USA Inc (NYSE:BZH) anticipates that spec sales, which carry lower margins, will represent more than 60% of closings, the highest level in a decade.

  • The company does not expect significant reductions in mortgage rates over the fiscal year, which could impact sales and profitability.

  • The first quarter of fiscal 2025 is expected to represent a trough for gross margin due to increased spec sales and incentives.

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