RED BANK, N.J., May 31 /PRNewswire-FirstCall/ -- Hovnanian Enterprises, Inc. , a leading national homebuilder, reported net income available to common stockholders of $101.0 million, or $1.55 per fully diluted common share, on $1.6 billion in total revenues for the quarter ended April 30, 2006. This is slightly greater than the company's prior guidance. For the six-month period ended April 30, 2006, revenues reached $2.9 billion, a 26% increase from $2.3 billion in revenues in the year earlier period. Net income available to common stockholders for the first half of fiscal 2006 was $182.4 million, or $2.80 per fully diluted common share, compared to $187.6 million, or $2.87 per fully diluted common share, in the same period a year ago.
Consistent with prior guidance, second quarter land sale profits were approximately $0.18 per fully diluted common share. Homebuilding gross margin in the 2006 second quarter, excluding interest expense in cost of sales, was 23.7%, compared with 26.4% in the 2005 second quarter. Total stockholders' equity grew 44% to $1.98 billion at April 30, 2006 from $1.37 billion on April 30, 2005. The Company was operating 411 active selling communities on April 30, 2006, excluding unconsolidated joint ventures, compared with 308 at the end of the second quarter last year.
Comments from Management
"Our performance in the first half of fiscal 2006 was just behind last year's record-setting performance, and our current sales pace, along with our strong contract backlog, positions us to conclude another solid year of deliveries, revenues and earnings, despite the current environment of slowing housing markets," said Ara K. Hovnanian, President and Chief Executive Officer of the Company. "Our return on beginning common equity for fiscal 2006 is projected to be nearly 30%, significantly higher than the average ROE among companies comprising the S&P 500.
"In the near term, we continue to experience a more challenging sales environment in most of our markets, when compared with conditions over the past few years," Mr. Hovnanian continued. "However, we believe the slowdown has been affected primarily by a sharp increase in investor resale inventory in some of our markets and community locations, combined with much more cautious buyer sentiment. Fortunately, economic and demographic fundamentals remain strong. Thus, we expect our more regulated markets, including New Jersey, California, Florida and metropolitan Washington, D.C., will return to a stronger level of sales contracts as the market overhang is absorbed and buyer sentiment improves. In the interim, we are managing our company and our land position cautiously, as we have done in past downturns during our 47-year history," Mr. Hovnanian stated. "And we have taken steps to prepare our sales associates and our communities to meet the more competitive environment that we are currently experiencing.
"As many of our housing markets have continued to cool off from the white- hot levels of previous years, we have renegotiated option contracts on numerous land parcels - primarily those negotiated within the last twelve months that no longer adequately reflect the pricing and returns available in the current sales environment," Mr. Hovnanian said. "We also walked away from about $5.6 million of deposits on land parcels that we controlled through options when we were unable to successfully renegotiate the purchase terms. This amount was charged off and reflected in our second quarter earnings, impacting net results by $0.05 per fully diluted common share. For years, we have employed a strategy of controlling land predominantly with options to allow us to efficiently manage inventories under changing market conditions. Our disciplined approach allows us to achieve the best possible returns commensurate with prudent risk for the Company and our shareholders," Mr. Hovnanian concluded.
"We expect earnings for the fiscal year ending October 31, 2006 to be in the range of $7.20 to $7.40 per fully diluted common share, slightly higher than what we achieved in 2005," said J. Larry Sorsby, Executive Vice President and Chief Financial Officer. "Given our current $4.8 billion sales backlog and our recent sales pace, we are well positioned to deliver on these expectations. More than 85% of our projected deliveries are either in sales backlog or delivered as of April 30th. We expect earnings for the third quarter to be in a range of $1.40 to $1.50 per fully diluted common share," Mr. Sorsby continued. "We expect to continue to manage the Company's average ratio of net recourse debt-to-capitalization below 50% for fiscal 2006. The ratio at April 30, 2006, which is typically near a seasonal peak for the year, was 50.6%."
In Closing
"We have consciously slowed our new land acquisition activity by underwriting transactions to our hurdle of a 30 percent unleveraged Internal Rate of Return while utilizing today's market environment including lower net prices and lower monthly sales pace assumptions. Additionally, to compete in today's environment, we have made adjustments in our advertising and selling efforts, as well as our pricing strategies," said Mr. Hovnanian. "Sales contracts have slowed from the white-hot pace we enjoyed the past couple of years, but they continue at sound historical levels. Our resolve and long- term focus to become a better, more efficient homebuilder has not changed. As we move ahead, we expect to be able to continue generating strong returns," Mr. Hovnanian concluded.
Hovnanian Enterprises will webcast its second quarter earnings conference call at 11:00 a.m. E.T. on Thursday, June 1, 2006, hosted by Ara K. Hovnanian, President and Chief Executive Officer of the Company. The webcast can be accessed live through the "Investor Relations" section of Hovnanian Enterprises' Web site at http://www.khov.com/. For those who are not available to listen to the live webcast, an archive of the broadcast will be available under the "Audio Archives" section of the Investor Relations page on the Hovnanian Web site at http://www.khov.com/. The archive will be available for 12 months.
The Company's summary projection for the fiscal year ending October 31, 2006 will be available today on the "Company Projections" section of the "Investor Relations" section of the Company's website at http://www.khov.com/.
About Hovnanian Enterprises
Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, Chairman, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, Michigan, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Forecast Homes, Parkside Homes, Brighton Homes, Parkwood Builders, Windward Homes, Cambridge Homes, Town & Country Homes, Oster Homes, First Home Builders of Florida and CraftBuilt Homes. As the developer of K. Hovnanian's Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes.
Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company's 2005 annual report, can be accessed through the "Investor Relations" section of the Hovnanian Enterprises' website at http://www.khov.com/. To be added to Hovnanian's investor e-mail or fax lists, please send an e-mail to
Hovnanian Enterprises, Inc. is a member of the Public Home Builders Council of America ("PHBCA") (http://www.phbca.org/), a nonprofit group devoted to improving understanding of the business practices of America's largest publicly-traded home building companies, the competitive advantages they bring to the home building market, and their commitment to creating value for their home buyers and stockholders. The PHBCA's 14 member companies build one out of every five homes in the United States.
Non-GAAP Financial Measures:
Consolidated earnings before interest expense, income taxes, depreciation and amortization ("EBITDA") is not a generally accepted accounting principle (GAAP) financial measure. The most directly comparable GAAP financial measure is net income. The reconciliation of EBITDA to net income is presented in a table attached to this earnings release.
Note: All statements in this Press Release that are not historical facts should be considered as "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic and business conditions, (2) adverse weather conditions and natural disasters, (3) changes in market conditions, (4) changes in home prices and sales activity in the markets where the Company builds homes, (5) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes and the environment, (6) fluctuations in interest rates and the availability of mortgage financing, (7) shortages in, and price fluctuations of, raw materials and labor, (8) the availability and cost of suitable land and improved lots, (9) levels of competition, (10) availability of financing to the Company, (11) utility shortages and outages or rate fluctuations, (12) geopolitical risks, terrorist acts and other acts of war, and (13) other factors described in detail in the Company's Form 10-K for the year ended October 31, 2005.
(Financial Tables Follow)
Hovnanian Enterprises, Inc.
April 30, 2006
Statements of Consolidated Income
(Dollars in Thousands, Except Per Share)
Three Months Ended, Six Months Ended,
April 30, April 30,
2006 2005 2006 2005
(Unaudited) (Unaudited)
Total Revenues $1,574,121 $1,209,469 $2,852,113 $2,264,030
Total Expenses 1,421,070 1,042,082 2,571,411 1,966,172
Income From
Unconsolidated Joint
Ventures 9,497 7,140 17,072 8,575
Income Before Income
Taxes 162,548 174,527 297,774 306,433
Provision for Taxes 58,899 68,391 110,029 118,815
Net Income 103,649 106,136 187,745 187,618
Less: Preferred Stock
Dividends 2,669 - 5,338 -
Net Income Available to
Common Stockholders $100,980 $106,136 $182,407 $187,618
Per Share Data:
Basic:
Income per common
share $1.60 $1.71 $2.90 $3.01
Weighted Average
Number of
Common Shares
Outstanding 62,919 62,233 62,864 62,237
Assuming Dilution:
Income per common
share $1.55 $1.62 $2.80 $2.87
Weighted Average
Number of Common
Shares Outstanding 65,106 65,498 65,254 65,459
Hovnanian Enterprises, Inc.
April 30, 2006
Gross Margin
(Dollars in Thousands)
Homebuilding Gross Margin Homebuilding Gross Margin
Three Months Ended Six Months Ended
April 30, April 30,
2006 2005 2006 2005
(Unaudited) (Unaudited)
Sale of Homes $1,479,548 $1,189,672 $2,725,745 $2,205,641
Cost of Sales,
excluding interest 1,128,530 875,016 2,055,352 1,632,101
Homebuilding Gross
Margin, excluding
interest $351,018 $314,656 $670,393 $573,540
Homebuilding Cost of
Sales interest 19,861 18,441 35,972 36,020
Homebuilding Gross
Margin, including
interest $331,157 $296,215 $634,421 $537,520
Gross Margin Percentage,
excluding interest 23.7% 26.4% 24.6% 26.0%
Gross Margin Percentage,
including interest 22.4% 24.9% 23.3% 24.4%
Land Sales Gross Margin Land Sales Gross Margin
Three Months Ended Six Months Ended
April 30, April 30,
2006 2005 2006 2005
(Unaudited) (Unaudited)
Land Sales $70,238 $1,173 $80,793 $24,177
Cost of Sales, excluding
interest (a) 51,769 1,811 59,634 15,981
Land Sales Gross Margin,
excluding interest $18,469 $(638) $21,159 $8,196
Land Sales interest 422 23 880 211
Land Sales Gross Margin,
including interest $18,047 $(661) $20,279 $7,985
(a) Does not include costs associated with walking away from land options which are recorded as inventory impairment losses in the income statement.
Hovnanian Enterprises, Inc.
April 30, 2006
Reconciliation of EBITDA to Net Income
(Dollars in Thousands)
Three Months Ended Six Months Ended
April 30, April 30,
2006 2005 2006 2005
(Unaudited) (Unaudited)
Net Income $103,649 $106,136 $187,745 $187,618
Income Taxes 58,899 68,391 110,029 118,815
Interest expense 20,983 19,003 38,372 36,925
EBIT(1) $183,531 $193,530 $336,146 $343,358
Depreciation 3,233 1,893 6,319 3,513
Amortization of
Debt Costs 573 348 1,009 709
Amortization of
Intangibles 13,391 10,386 25,060 20,474
Other Amortization - - - 528
EBITDA(2) $200,728 $206,157 $368,534 $368,582
INTEREST INCURRED $36,250 $22,904 $67,054 $43,948
EBITDA TO
INTEREST INCURRED 5.54 9.00 5.50 8.39
(1) EBIT is a non-GAAP financial measure. The comparable GAAP financial measure is net income. EBIT represents earnings before interest expense and income taxes.
(2) EBITDA is a non-GAAP financial measure. The comparable GAAP financial measure is net income. EBITDA represents earnings before interest expense, income taxes, depreciation and amortization.
Hovnanian Enterprises, Inc.
April 30, 2006
Interest Incurred, Expensed and Capitalized
(Dollars in Thousands)
Three Months Ended Six Months Ended
April 30, April 30,
2006 2005 2006 2005
(Unaudited) (Unaudited)
Interest Capitalized at
Beginning of Period $61,781 $40,587 $48,366 $37,465
Plus Interest Incurred 36,250 22,904 67,054 43,948
Less Interest Expensed 20,983 19,003 38,372 36,925
Interest Capitalized at
End of Period $77,048 $44,488 $77,048 $44,488
Hovnanian Enterprises, Inc.
April 30, 2006
Summary Financial Projection
(Dollars in Millions, except per share or where noted)
(Unaudited)
Trailing Projection
Fiscal Yr. Fiscal Yr. Fiscal Yr. 12 Mos. Fiscal Yr.
10/31/03 10/31/04 10/31/05 04/30/06 10/31/06*
Total Revenues
($ Billion) $3.20 $4.15 $5.35 $5.94 $6.50 - $6.70
Income Before Income
Taxes $411.5 $549.8 $780.6 $771.9 $760.0 - $780.0
Pre-tax Margin 12.9% 13.2% 14.6% 13.0% 11.5% - 11.8%
Net Income Available
to Common
Stockholders ** $257.4 $348.7 $469.1 $463.9 $471.0 - $484.0
Earnings Per Common
Share
(fully diluted) $3.93 $5.35 $7.16 $7.09 $7.20 - $7.40
* 2006 Projection is based on two quarters of projected results and two quarters of actual data.
** Net Income less preferred dividends paid; preferred dividends were $0 in fiscal 2003 and 2004.
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Amounts)
April 30, October 31,
ASSETS 2006 2005
----------- -----------
(unaudited)
Homebuilding:
Cash and cash equivalents.................... $47,525 $201,641
----------- -----------
Restricted cash.............................. 8,766 17,189
----------- -----------
Inventories - At the lower of cost or fair
value:
Sold and unsold homes and lots under
development.............................. 3,306,101 2,459,431
----------- -----------
Land and land options held for future
development or sale...................... 561,220 595,806
----------- -----------
Consolidated Inventory Not Owned:
Specific performance options............. 10,696 9,289
Variable interest entities............... 381,178 242,825
Other options............................ 136,530 129,269
----------- -----------
Total Consolidated Inventory Not Owned.. 528,404 381,383
----------- -----------
Total Inventories........................ 4,395,725 3,436,620
----------- -----------
Investments in and advances to unconsolidated
joint ventures............................. 211,556 187,205
----------- -----------
Receivables, deposits, and notes ............ 82,206 125,388
----------- -----------
Property, plant, and equipment - net......... 110,509 96,891
----------- -----------
Prepaid expenses and other assets............ 165,642 125,662
----------- -----------
Goodwill..................................... 32,658 32,658
----------- -----------
Definite life intangibles.................... 204,875 249,506
----------- -----------
Total Homebuilding....................... 5,259,462 4,472,760
----------- -----------
Financial Services:
Cash and cash equivalents.................... 6,504 10,669
Mortgage loans held for sale................. 214,190 211,248
Other assets................................. 6,482 15,375
----------- -----------
Total Financial Services................. 227,176 237,292
----------- -----------
Income Taxes Receivable - Including Deferred
Tax Benefits................................. 96,650 9,903
----------- -----------
Total Assets................................... $5,583,288 $4,719,955
=========== ===========
See notes to condensed consolidated financial statements (unaudited).
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Amounts)
April 30, October 31,
LIABILITIES AND STOCKHOLDERS' EQUITY 2006 2005
----------- ----------
(unaudited)
Homebuilding:
Nonrecourse land mortgages...................... $38,117 $48,673
Accounts payable and other liabilities.......... 500,286 510,529
Customers' deposits............................. 238,709 259,930
Nonrecourse mortgages secured by operating
properties.................................... 24,017 24,339
Liabilities from inventory not owned............ 254,691 177,014
----------- ----------
Total Homebuilding.......................... 1,055,820 1,020,485
----------- ----------
Financial Services:
Accounts payable and other liabilities.......... 8,887 8,461
Mortgage warehouse line of credit............... 195,189 198,856
----------- ----------
Total Financial Services.................... 204,076 207,317
----------- -----------
Notes Payable:
Revolving credit agreement...................... 275,000
Senior notes.................................... 1,399,247 1,098,739
Senior subordinated notes....................... 400,000 400,000
Accrued interest................................ 25,375 20,808
----------- ----------
Total Notes Payable......................... 2,099,622 1,519,547
----------- ----------
Total Liabilities................................. 3,359,518 2,747,349
----------- ----------
Minority interest from inventory not owned........ 243,339 180,170
----------- ----------
Minority interest from consolidated joint ventures. 3,241 1,079
----------- ----------
Stockholders' Equity:
Preferred Stock, $.01 par value-authorized 100,000
shares; issued 5,600 shares at April 30,
2006 and at October 31, 2005 with a
liquidation preference of $140,000.
Common Stock, Class A,$.01 par value-authorized
200,000,000 shares; issued 58,378,455 shares at
April 30, 2006 and 57,976,455 shares at
October 31, 2005 (including 11,295,656 shares
at April 30, 2006 and 10,995,656 shares at
October 31, 2005 held in Treasury)............. 584 580
Common Stock, Class B,$.01 par value (convertible
to Class A at time of sale) authorized
30,000,000 shares; issued 15,363,534 shares at
April 30, 2006 and 15,370,250 shares at
October 31, 2005 (including 691,748 shares at
April 30, 2006 and October 31, 2005 held in
Treasury)...................................... 154 154
Paid in Capital.................................. 369,317 371,390
Retained Earnings................................ 1,705,359 1,522,952
Deferred Compensation............................ (19,648)
Treasury Stock - at cost......................... (98,224) (84,071)
----------- ----------
Total Stockholders' Equity................... 1,977,190 1,791,357
----------- ----------
Total Liabilities and Stockholders' Equity.........$5,583,288 $4,719,955
=========== ==========
See notes to condensed consolidated financial statements (unaudited).
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In Thousands Except Per Share Data)
(Unaudited)
Three Months Ended Six Months Ended
April 30, April 30,
----------------------- ----------------------
2006 2005 2006 2005
----------- ---------- ---------- ----------
Revenues:
Homebuilding:
Sale of homes........ $1,479,548 $1,189,672 $2,725,745 $2,205,641
Land sales and other
revenues............ 73,382 3,528 85,915 27,927
----------- ---------- ---------- ----------
Total Homebuilding. 1,552,930 1,193,200 2,811,660 2,233,568
Financial Services..... 21,191 16,269 40,453 30,462
----------- ---------- ---------- ----------
Total Revenues..... 1,574,121 1,209,469 2,852,113 2,264,030
----------- ---------- ---------- ----------
Expenses:
Homebuilding:
Cost of sales,
excluding interest.. 1,180,299 876,827 2,114,986 1,648,083
Cost of sales
interest............ 20,283 18,464 36,852 36,231
----------- ---------- ---------- ----------
Total Cost of Sales 1,200,582 895,291 2,151,838 1,684,314
----------- ---------- ---------- ----------
Selling, general and
administrative...... 151,853 106,704 287,087 203,292
Inventory impairment
loss................ 5,595 1,500 8,704 1,998
----------- ---------- ---------- ----------
Total Homebuilding. 1,358,030 1,003,495 2,447,629 1,889,604
Financial Services..... 14,517 11,467 28,047 21,387
Corporate General and
Administrative........ 25,911 14,916 53,633 30,794
Other Interest......... 700 539 1,520 694
Other Operations....... 8,521 1,279 15,522 3,219
Intangible Amortization 13,391 10,386 25,060 20,474
----------- ---------- ---------- ----------
Total Expenses..... 1,421,070 1,042,082 2,571,411 1,966,172
----------- ---------- ---------- ----------
Income from unconsolidated
joint ventures.......... 9,497 7,140 17,072 8,575
----------- ---------- ---------- ----------
Income Before Income Taxes 162,548 174,527 297,774 306,433
----------- ---------- ---------- ----------
State and Federal
Income Taxes:
State.................. 6,235 10,318 11,109 15,764
Federal................ 52,664 58,073 98,920 103,051
----------- ---------- ---------- ----------
Total Taxes.......... 58,899 68,391 110,029 118,815
----------- ---------- ---------- ----------
Net Income............... 103,649 106,136 187,745 187,618
Less: Preferred Stock
Dividends.............. 2,669 5,338
----------- ---------- ---------- ----------
Net Income Available to Common
Stockholders........... $ 100,980 $ 106,136 $ 182,407 $ 187,618
=========== ========== ========== ==========
Per Share Data:
Basic:
Income per common share.$ 1.60 $ 1.71 $ 2.90 $ 3.01
Weighted average number
of common shares
outstanding............ 62,919 62,233 62,864 62,237
Assuming dilution:
Income per common share.$ 1.55 $ 1.62 $ 2.80 $ 2.87
Weighted average number
of common shares
outstanding............ 65,106 65,498 65,254 65,459
See notes to condensed consolidated financial statements (unaudited).
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED)
Communities Under Development
Three Months - 4/30/06
Net Contracts(1)
Three Months Ended
April 30,
2006 2005 % Change
NorthEast Region(2)
Homes 761 734 3.7%
Dollars 277,581 253,736 9.4%
Avg. Price 364,758 345,689 5.5%
SouthEast Region(3)
Homes 1,248 1,518 (17.8%)
Dollars 499,535 538,285 (7.2%)
Avg. Price 400,268 354,601 12.9%
SouthWest Region
Homes 1,235 1,222 1.1%
Dollars 265,790 235,487 12.9%
Avg. Price 215,215 192,706 11.7%
West Region
Homes 718 1,216 (41.0%)
Dollars 343,303 506,363 (32.2%)
Avg. Price 478,138 416,417 14.8%
Consolidated Total
Homes 3,962 4,690 (15.5%)
Dollars 1,386,209 1,533,871 (9.6%)
Avg. Price 349,876 327,051 7.0%
Unconsolidated Joint Ventures(4)
Homes 380 638 (40.4%)
Dollars 129,757 320,437 (59.5%)
Avg. Price 341,467 502,252 (32.0%)
Total
Homes 4,342 5,328 (18.5%)
Dollars 1,515,966 1,854,308 (18.2%)
Avg. Price 349,140 348,031 0.3%
DELIVERIES INCLUDE EXTRAS
Deliveries
Three Months Ended
April 30,
2006 2005 % Change
NorthEast Region(2)
Homes 646 725 (10.9%)
Dollars 232,952 267,245 (12.8%)
Avg. Price 360,607 368,614 (2.2%)
SouthEast Region(3)
Homes 1,807 1,118 61.6%
Dollars 562,214 334,900 67.9%
Avg. Price 311,131 299,553 3.9%
SouthWest Region
Homes 1,054 900 17.1%
Dollars 232,289 164,133 41.5%
Avg. Price 220,388 182,370 20.8%
West Region
Homes 1,048 1,005 4.3%
Dollars 452,093 423,394 6.8%
Avg. Price 431,386 421,288 2.4%
Consolidated Total
Homes 4,555 3,748 21.5%
Dollars 1,479,548 1,189,672 24.4%
Avg. Price 324,818 317,415 2.3%
Unconsolidated Joint Ventures(4)
Homes 612 351 74.4%
Dollars 244,402 123,732 97.5%
Avg. Price 399,350 352,513 13.3%
Total
Homes 5,167 4,099 26.1%
Dollars 1,723,950 1,313,404 31.3%
Avg. Price 333,646 320,421 4.1%
DELIVERIES INCLUDE EXTRAS
Contract Backlog
April 30,
2006 2005 % Change
NorthEast Region(2)
Homes 2,275 2,100 8.3%
Dollars 869,734 732,039 18.8%
Avg. Price 382,301 348,590 9.7%
SouthEast Region(3)
Homes 6,743 3,236 108.4%
Dollars 2,199,767 1,144,365 92.2%
Avg. Price 326,230 353,636 (7.7%)
SouthWest Region
Homes 1,406 1,428 (1.5%)
Dollars 315,309 272,554 15.7%
Avg. Price 224,259 190,864 17.5%
West Region
Homes 1,163 2,072 (43.9%)
Dollars 587,465 862,048 (31.9%)
Avg. Price 505,129 416,046 21.4%
Consolidated Total
Homes 11,587 8,836 31.1%
Dollars 3,972,275 3,011,006 31.9%
Avg. Price 342,822 340,766 0.6%
Unconsolidated Joint Ventures(4)
Homes 1,797 2,150 (16.4%)
Dollars 810,115 879,482 (7.9%)
Avg. Price 450,815 409,061 10.2%
Total
Homes 13,384 10,986 21.8%
Dollars 4,782,390 3,890,488 22.9%
Avg. Price 357,321 354,131 0.9%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as new contracts signed during the period
for the purchase of homes, less cancellations of prior contracts.
(2) The number and the dollar amount of net contracts in the Northeast in
the 2006 second quarter include the effect of the Oster Homes
acquisition, which closed in August 2005.
(3) The number and the dollar amount of net contracts in the Southeast in
the 2006 second quarter include the effects of the Cambridge Homes, First
Home Builders of Florida and CraftBuilt Homes acquisitions, which closed
in March 2005, August 2005 and April 2006, respectively.
(4) The number and the dollar amount of net contracts in Unconsolidated
Joint Ventures in the 2006 second quarter include the effect of the Town
& Country Homes acquisition, which closed in March 2005.
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED)
Communities Under Development
Six Months - 4/30/06
Net Contracts(1)
Six Months Ended
April 30,
2006 2005 % Change
NorthEast Region(2)
Homes 1,369 1,256 9.0%
Dollars 501,982 443,341 13.2%
Avg. Price 366,678 352,979 3.9%
SouthEast Region(3)
Homes 2,615 2,367 10.5%
Dollars 1,000,936 823,167 21.6%
Avg. Price 382,767 347,768 10.1%
SouthWest Region
Homes 2,036 2,119 (3.9%)
Dollars 436,494 400,535 9.0%
Avg. Price 214,388 189,021 13.4%
West Region
Homes 1,292 2,122 (39.1%)
Dollars 600,454 860,487 (30.2%)
Avg. Price 464,748 405,508 14.6%
Consolidated Total
Homes 7,312 7,864 (7.0%)
Dollars 2,539,866 2,527,530 0.5%
Avg. Price 347,356 321,405 8.1%
Unconsolidated Joint Ventures(4)
Homes 654 704 (7.1%)
Dollars 238,329 361,784 (34.1%)
Avg. Price 364,417 513,898 (29.1%)
Total
Homes 7,966 8,568 (7.0%)
Dollars 2,778,195 2,889,314 (3.8%)
Avg. Price 348,757 337,222 3.4%
DELIVERIES INCLUDE EXTRAS
Deliveries
Six Months Ended
April 30,
2006 2005 % Change
NorthEast Region(2)
Homes 1,258 1,412 (10.9%)
Dollars 458,454 505,706 (9.3%)
Avg. Price 364,431 358,149 1.8%
SouthEast Region(3)
Homes 3,334 2,020 65.0%
Dollars 1,029,870 598,734 72.0%
Avg. Price 308,899 296,403 4.2%
SouthWest Region
Homes 1,926 1,615 19.3%
Dollars 415,548 300,044 38.5%
Avg. Price 215,757 185,786 16.1%
West Region
Homes 1,882 1,967 (4.3%)
Dollars 821,873 801,157 2.6%
Avg. Price 436,702 407,299 7.2%
Consolidated Total
Homes 8,400 7,014 19.8%
Dollars 2,725,745 2,205,641 23.6%
Avg. Price 324,493 314,463 3.2%
Unconsolidated Joint Ventures(4)
Homes 1,197 373 220.9%
Dollars 459,014 135,317 239.2%
Avg. Price 383,470 362,780 5.7%
Total
Homes 9,597 7,387 29.9%
Dollars 3,184,759 2,340,958 36.0%
Avg. Price 331,849 316,902 4.7%
DELIVERIES INCLUDE EXTRAS
Contract Backlog
April 30,
2006 2005 % Change
NorthEast Region(2)
Homes 2,275 2,100 8.3%
Dollars 869,734 732,039 18.8%
Avg. Price 382,301 348,590 9.7%
SouthEast Region(3)
Homes 6,743 3,236 108.4%
Dollars 2,199,767 1,144,365 92.2%
Avg. Price 326,230 353,636 (7.7%)
SouthWest Region
Homes 1,406 1,428 (1.5%)
Dollars 315,309 272,554 15.7%
Avg. Price 224,259 190,864 17.5%
West Region
Homes 1,163 2,072 (43.9%)
Dollars 587,465 862,048 (31.9%)
Avg. Price 505,129 416,046 21.4%
Consolidated Total
Homes 11,587 8,836 31.1%
Dollars 3,972,275 3,011,006 31.9%
Avg. Price 342,822 340,766 0.6%
Unconsolidated Joint Ventures(4)
Homes 1,797 2,150 (16.4%)
Dollars 810,115 879,482 (7.9%)
Avg. Price 450,815 409,061 10.2%
Total
Homes 13,384 10,986 21.8%
Dollars 4,782,390 3,890,488 22.9%
Avg. Price 357,321 354,131 0.9%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.
(2) The number and the dollar amount of net contracts in the Northeast in the 2006 first half include the effect of the Oster Homes acquisition, which closed in August 2005.
(3) The number and the dollar amount of net contracts in the Southeast in the 2006 first half include the effects of the Cambridge Homes, First Home Builders of Florida and CraftBuilt Homes acquisitions, which closed in March 2005, August 2005 and April 2006, respectively.
(4) The number and the dollar amount of net contracts in Unconsolidated Joint Ventures in the 2006 first half include the effect of the Town & Country Homes acquisition, which closed in March 2005.
