M/I Homes Reports 2020 Third Quarter Results

COLUMBUS, Ohio, Oct. 28, 2020 /PRNewswire/ -- M/I Homes, Inc. (NYSE:MHO) announced results for the three and nine months ended September 30, 2020.

2020 Third Quarter Highlights:

• New contracts increased 71% to 2,949 contracts, an all-time quarterly record
• Backlog units increased 54% to 4,503, an all-time quarterly record
• Backlog sales value reached $1.8 billion, an all-time quarterly record
• Homes delivered increased 29% to 2,137, an all-time quarterly record
• Revenue increased 30% to an all-time quarterly record of $847.9 million
• Pre-tax income increased 90% to $95.1 million, an all-time quarterly record
• Third quarter net income of $73.5 million ($2.51 per diluted share), a 94% increase compared to $37.8 million ($1.32 per diluted share) in 2019
• Shareholders' equity reached an all-time record of $1.2 billion, a 23% increase from a year ago, with book value per share of $41
• Homebuilding debt to capital of 36% compared to 44% at September 30, 2019

For the third quarter, pre-tax income increased 90% to a record $95.1 million and third quarter net income increased 94% to $73.5 million, or $2.51 per diluted share.  This compares to pre-tax income of $50.1 million and net income of $37.8 million, or $1.32 per diluted share, for the third quarter of 2019.  For the nine months ended September 30, 2020, net income increased 86% to a record $159.8 million, or $5.50 per diluted share, compared to $85.8 million, or $3.04 per diluted share, for the same period of 2019.

Homes delivered in 2020's third quarter increased 29% to a record 2,137.  This compares to 1,651 homes delivered in 2019's third quarter.  Homes delivered for the nine months ended September 30, 2020 increased 25% to a record 5,467 from 2019's deliveries of 4,375. New contracts for the third quarter of 2020 were a record 2,949, a 71% increase over 2019's 1,721. For the first nine months of 2020, new contracts increased 43% to a record 7,299 compared to 5,096 in 2019. Homes in backlog at September 30, 2020 had a total sales value of $1.8 billion, a 60% increase from a year ago. Backlog units at September 30, 2020 increased 54% to a record 4,503 homes, with an average sales price of $404,000.  At September 30, 2019, backlog sales value was $1.1 billion, with backlog units of 2,915 and an average sales price of $390,000.  M/I Homes had 207 active communities at September 30, 2020 compared to 221 active communities at September 30, 2019.  The Company's cancellation rate was 10% and 13% in the third quarter of 2020 and 2019, respectively.

Robert H. Schottenstein, Chief Executive Officer and President, commented, "We had an outstanding quarter highlighted by a 71% increase in new contracts, a 29% increase in homes delivered and a 94% increase in net income.  Our gross margins were very strong, improving 240 basis points over last year, and our overhead expense ratio improved by 60 basis points.  As a result, our third quarter pre-tax income percentage improved to 11.2% from 7.7% last year. And, our backlog sales value at September 30, 2020 increased 60% to a record $1.8 billion."

Mr. Schottenstein continued, "We ended the quarter with record-high shareholders' equity of $1.2 billion, an increase of 23% from 2019's third quarter, book value of $41 per share, cash of $203 million, no borrowings on our $500 million credit facility and a homebuilding debt to capital ratio of 36%.  Despite the impact of COVID-19, housing fundamentals remain strong. We have significant operating momentum and are poised to continue delivering very strong results in 2020."

J. Thomas Mason Announces Retirement

On October 27, 2020, J. Thomas Mason announced his decision to retire as Executive Vice President, Secretary, and Chief Legal Officer of M/I Homes effective after the Company has hired his replacement to assure a smooth and orderly transition of responsibilities.  It is anticipated that such transition will occur in the first half of 2021.  In connection with Mr. Mason's retirement announcement, Robert H. Schottenstein stated, "Tom Mason has been an outstanding leader of our company since joining M/I in 2002.  A valued co-worker and friend, Tom has meaningfully contributed to our success.  We thank him for all he has done, and wish him only the best in his retirement; and we look forward to a smooth transition in the first half of next year."

The Company will broadcast live its earnings conference call today at 4:00 p.m. Eastern Time. To listen to the call live, log on to the M/I Homes website at mihomes.com, click on the "Investors" section of the site, and select "Listen to the Conference Call." A replay of the call will continue to be available on our website through October 2021.

M/I Homes, Inc. is one of the nation's leading builders of single-family homes, having sold over 125,500 homes.  The Company's homes are marketed and sold primarily under the trade names M/I Homes and Showcase Collection (exclusively by M/I Homes), and are also currently sold under the name Hans Hagen Homes in the Minneapolis/St. Paul, Minnesota market.  The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Chicago, Illinois; Minneapolis/St. Paul, Minnesota; Detroit, Michigan; Tampa, Sarasota and Orlando, Florida; Austin, Dallas/Fort Worth, Houston and San Antonio, Texas; and Charlotte and Raleigh, North Carolina.

Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "targets," "envisions," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements. These statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in any future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various factors, including, without limitation, factors relating to the economic environment, including the impact of COVID-19, interest rates, availability of resources, competition, market concentration, land development activities, integration of acquisitions, construction defects, product liability and warranty claims and various governmental rules and regulations, as more fully discussed in the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2019, as the same may be updated from time to time in our subsequent filings with the Securities and Exchange Commission. All forward-looking statements made in this press release are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed herein will increase with the passage of time. We undertake no duty to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or presentations should be consulted.

SOURCE M/I Homes, Inc.