NVR, Inc. Announces First Quarter Results

RESTON, Va., April 20, 2017 /PRNewswire/ -- NVR, Inc. (NYSE: NVR), one of the nation's largest homebuilding and mortgage banking companies, announced net income for its first quarter ended March 31, 2017 of $102,923,000, or $25.12 per diluted share.  Net income and diluted earnings per share for the first quarter ended March 31, 2017 increased 58% and 59%, respectively, when compared to the 2016 first quarter of $65,303,000, or $15.79 per diluted share.  Consolidated revenues for the first quarter of 2017 totaled $1,277,092,000, a 12% increase from $1,144,026,000 for the comparable 2016 quarter.

Net income and diluted earnings per share were favorably impacted by the reduction in the Company's effective tax rate in the first quarter of 2017 to 22.1% from 36.8% in the first quarter of 2016.  The reduction in the effective tax rate was primarily due to the Company's January 1, 2017 adoption of Accounting Standard Update 2016-09, which resulted in the Company recognizing an income tax benefit of $19,900,000 related to excess tax benefit from stock option exercises in the first quarter of 2017.  In the first quarter of 2016, the excess tax benefit of $6,284,000 was recorded to additional paid-in capital within shareholders' equity on the consolidated balance sheet.  Excluding the impact of the excess tax benefit recognized in the first quarter of 2017, the effective tax rate would have been 37.2%.  Additionally, the excess tax benefit in the first quarter of 2017 favorably impacted diluted earnings per share by $4.86 per share.

Homebuilding

New orders in the first quarter of 2017 increased 7% to 4,424 units, when compared to 4,137 units in the first quarter of 2016. The average sales price of new orders in the first quarter of 2017 was $392,600, an increase of 5% when compared with the first quarter of 2016.  The cancellation rate in the first quarter of 2017 was 16%, compared with 15% in the first quarter of 2016.  Settlements increased in the first quarter of 2017 to 3,256 units, 8% higher than the first quarter of 2016.  The Company's backlog of homes sold but not settled as of March 31, 2017 increased on a unit basis by 9% to 8,052 units and increased on a dollar basis by 13% to $3,193,777,000 when compared to March 31, 2016.

Homebuilding revenues in the first quarter of 2017 totaled $1,247,587,000, 11% higher than the year earlier period.  Gross profit margin in the first quarter of 2017 was 17.8%, compared to 17.5% in the first quarter of 2016.  Income before tax from the homebuilding segment totaled $117,190,000 in the first quarter of 2017, an increase of 25% when compared to the first quarter of 2016.

Mortgage Banking

Mortgage closed loan production in the first quarter of 2017 totaled $843,341,000, an increase of 12% when compared to the first quarter of 2016. Income before tax from the mortgage banking segment for the first quarter of 2017 was $14,971,000, compared to $9,658,000 for the first quarter of 2016.

About NVR

NVR, Inc. operates in two business segments:  homebuilding and mortgage banking.  The homebuilding unit sells and builds homes under the Ryan Homes, NVHomes and Heartland Homes trade names, and operates in twenty-nine metropolitan areas in fourteen states and Washington, D.C.  For more information about NVR, Inc. and its brands, see www.nvrinc.com, www.ryanhomes.com, www.nvhomes.com and www.heartlandluxuryhomes.com.

Some of the statements in this release made by the Company constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as "believes," "expects," "may," "will," "should" or "anticipates" or the negative thereof or other comparable terminology.  All statements other than of historical facts are forward-looking statements.  Forward-looking statements contained in this document may include those regarding market trends, NVR's financial position, business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of NVR to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements.  Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by NVR and NVR's customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by NVR in its homebuilding operations; shortages of labor; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which NVR has little or no control.  NVR undertakes no obligation to update such forward-looking statements except as required by law.

SOURCE NVR, Inc.