NVR, INC. ANNOUNCES FIRST QUARTER RESULTS

Published

RESTON, Va., April 23, 2024 /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, 2024 of $394.3 million, or $116.41 per diluted share. Net income and diluted earnings per share for the first quarter ended March 31, 2024 increased 14% and 17%, respectively, when compared to 2023 first quarter net income of $344.4 million, or $99.89 per diluted share.  Consolidated revenues for the first quarter of 2024 totaled $2.33 billion, which increased 7% from $2.18 billion in the first quarter of 2023. 

Homebuilding

New orders in the first quarter of 2024 increased by 3% to 6,049 units, when compared to 5,888 units in the first quarter of 2023. The average sales price of new orders in the first quarter of 2024 was $454,300, an increase of 3% when compared with the first quarter of 2023. The cancellation rate in the first quarter of 2024 was 13% compared to 14% in the first quarter of 2023.  Settlements in the first quarter of 2024 increased by 10% to 5,089 units, compared to 4,639 units in the first quarter of 2023. The average settlement price in the first quarter of 2024 was $449,200, a decrease of 2% from the first quarter of 2023. Our backlog of homes sold but not settled as of March 31, 2024 increased on a unit basis by 7% to 11,189 units and increased on a dollar basis by 9% to $5.22 billion when compared to the respective backlog unit and dollar balances as of March 31, 2023.

Homebuilding revenues of $2.29 billion in the first quarter of 2024 increased by 7% compared to homebuilding revenues of $2.13 billion in the first quarter of 2023. Gross profit margin in the first quarter of 2024 decreased slightly to 24.5%, compared to 24.6% in the first quarter of 2023. Income before tax from the homebuilding segment totaled $441.7 million in the first quarter of 2024, an increase of 9% when compared to the first quarter of 2023.

Mortgage Banking

Mortgage closed loan production in the first quarter of 2024 totaled $1.38 billion, an increase of 11% when compared to the first quarter of 2023. Income before tax from the mortgage banking segment totaled $29.0 million in the first quarter of 2024, an increase of 3% when compared to $28.1 million in the first quarter of 2023. 

Effective Tax Rate

Our effective tax rate for the three months ended March 31, 2024 was 16.2% compared to 20.6% for the three months ended March 31, 2023. The decrease in the effective tax rate in the first quarter of 2024 is primarily attributable to a higher income tax benefit recognized for excess tax benefits from stock option exercises, which totaled $43.8 million and $23.2 million for the three months ended March 31, 2024 and March 31, 2023, respectively.

About NVR

NVR, Inc. operates in two business segments: homebuilding and mortgage banking. The homebuilding segment sells and builds homes under the Ryan Homes, NVHomes and Heartland Homes trade names, and operates in thirty-six metropolitan areas in sixteen 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 and financial results, 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; the economic impact of a major epidemic or pandemic; 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.

NVR, Inc.

Consolidated Statements of Income

(in thousands, except per share data)

(unaudited)

Three Months Ended March 31,

2024

2023

Homebuilding:

Revenues

$          2,286,177

$          2,131,333

Other income

40,866

32,946

Cost of sales

(1,726,213)

(1,607,910)

Selling, general and administrative

(152,503)

(143,618)

Operating income

448,327

412,751

Interest expense

(6,649)

(7,001)

Homebuilding income

441,678

405,750

Mortgage Banking:

Mortgage banking fees

47,286

46,944

Interest income

4,092

3,018

Other income

1,171

989

General and administrative

(23,358)

(22,634)

Interest expense

(177)

(257)

Mortgage banking income

29,014

28,060

Income before taxes

470,692

433,810

Income tax expense

(76,423)

(89,458)

Net income

$              394,269

$              344,352

Basic earnings per share

$                123.76

$                106.31

Diluted earnings per share

$                116.41

$                  99.89

Basic weighted average shares outstanding

3,186

3,239

Diluted weighted average shares outstanding

3,387

3,447

 

NVR, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share data)

(unaudited)

March 31, 2024

December 31, 2023

ASSETS

Homebuilding:

Cash and cash equivalents

$              2,841,354

$              3,126,472

Restricted cash

44,099

41,483

Receivables

36,306

29,000

Inventory:

Lots and housing units, covered under sales agreements with customers

1,790,687

1,674,686

Unsold lots and housing units

245,262

214,666

Land under development

59,050

36,895

Building materials and other

22,035

23,903

2,117,034

1,950,150

Contract land deposits, net

609,407

576,551

Property, plant and equipment, net

63,095

63,716

Operating lease right-of-use assets

66,716

70,384

Reorganization value in excess of amounts allocable to identifiable assets, net

41,580

41,580

Other assets

249,390

242,751

6,068,981

6,142,087

Mortgage Banking:

Cash and cash equivalents

27,803

36,422

Restricted cash

11,537

11,067

Mortgage loans held for sale, net

332,510

222,560

Property and equipment, net

7,438

6,348

Operating lease right-of-use assets

22,008

23,541

Reorganization value in excess of amounts allocable to identifiable assets, net

7,347

7,347

Other assets

60,533

152,385

469,176

459,670

Total assets

$              6,538,157

$              6,601,757

 

NVR, Inc.

Consolidated Balance Sheets (Continued)

(in thousands, except share and per share data)

(unaudited)

March 31, 2024

December 31, 2023

LIABILITIES AND SHAREHOLDERS' EQUITY

Homebuilding:

Accounts payable

$                  391,591

$                  347,738

Accrued expenses and other liabilities

380,811

413,043

Customer deposits

355,331

334,441

Operating lease liabilities

72,052

75,797

Senior notes

912,554

913,027

2,112,339

2,084,046

Mortgage Banking:

Accounts payable and other liabilities

57,400

127,511

Operating lease liabilities

24,037

25,475

81,437

152,986

Total liabilities

2,193,776

2,237,032

Commitments and contingencies

Shareholders' equity:

Common stock, $0.01 par value; 60,000,000 shares authorized; 20,555,330 sharesissued as of both March 31, 2024 and December 31, 2023

206

206

Additional paid-in capital

2,905,707

2,848,528

Deferred compensation trust – 106,697 shares of NVR, Inc. common stock as ofboth March 31, 2024 and December 31, 2023

(16,710)

(16,710)

Deferred compensation liability

16,710

16,710

Retained earnings

13,759,294

13,365,025

Less treasury stock at cost – 17,387,705 and 17,360,454 shares as of March 31,2024 and December 31, 2023, respectively

(12,320,826)

(11,849,034)

Total shareholders' equity

4,344,381

4,364,725

Total liabilities and shareholders' equity

$              6,538,157

$              6,601,757

 

NVR, Inc.

Operating Activity

(dollars in thousands)

(unaudited)

Three Months Ended March 31,

2024

2023

Units

AveragePrice

Units

AveragePrice

New orders, net of cancellations:

Mid Atlantic (1)

2,282

$         515.4

2,235

$         516.3

North East (2)

527

$         612.6

442

$         573.1

Mid East (3)

1,263

$         409.9

1,317

$         384.2

South East (4)

1,977

$         369.9

1,894

$         361.5

Total

6,049

$         454.3

5,888

$         441.2

Three Months Ended March 31,

2024

2023

Units

AveragePrice

Units

AveragePrice

Settlements:

Mid Atlantic (1)

1,966

$         517.5

1,795

$         524.3

North East (2)

463

$         552.2

363

$         505.3

Mid East (3)

1,049

$         397.5

989

$         406.8

South East (4)

1,611

$         370.0

1,492

$         405.1

Total

5,089

$         449.2

4,639

$         459.4

As of March 31,

2024

2023

Units

AveragePrice

Units

AveragePrice

Backlog:

Mid Atlantic (1)

4,410

$         521.0

4,132

$         530.6

North East (2)

1,092

$         628.2

964

$         580.8

Mid East (3)

2,190

$         417.7

2,181

$         390.1

South East (4)

3,497

$         377.5

3,134

$         379.3

Total

11,189

$         466.4

10,411

$         460.3

 

NVR, Inc.

Operating Activity (Continued)

(dollars in thousands)

(unaudited)

Three Months Ended March 31,

2024

2023

Average active communities:

Mid Atlantic (1)

157

162

North East (2)

34

37

Mid East (3)

100

113

South East (4)

136

101

Total

427

413

Three Months Ended March 31,

2024

2023

Homebuilding data:

New order cancellation rate

13 %

14 %

Lots controlled at end of period

143,200

129,900

Mortgage banking data:

Loan closings

$         1,378,009

$         1,237,283

Capture rate

86 %

83 %

Common stock information:

Shares outstanding at end of period

3,167,625

3,241,750

Number of shares repurchased

66,858

21,174

Aggregate cost of shares repurchased

$            496,936

$            110,048

(1)

Maryland, Virginia, West Virginia, Delaware and Washington, D.C.

(2)

New Jersey and Eastern Pennsylvania

(3)

New York, Ohio, Western Pennsylvania, Indiana and Illinois

(4)

North Carolina, South Carolina, Tennessee, Florida, Georgia and Kentucky

 

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SOURCE NVR, INC.

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