Homebuilding

- Home Sales

- Land/Lot Sales and Other

Rental

- Rental Property Sales

Forestar

Financial Services

Other

Eliminations and Other

Total Revenue

4f34d7df78178b6457886dffbecd503876bdc6605390ed5356c40f7c1e8dff8c

Cash and Cash Equivalents (USD, millions)

Inventory (USD, millions)

Property, Plant, and Equipment (USD, millions)

Goodwill (USD, millions)

Accounts Payable (USD, millions)

Accrued Expenses (USD, millions)

Shareholders' Equity (USD, millions)

Retained Earnings (USD, millions)

Common Stock (USD, millions)

Additional Paid-in Capital (USD, millions)

b6e701bfdbf1481d3c4fb1019e3e1deda04baf4b2c0005f0a139ac8adc31eeb1

a82f7e96de6abb63406adecce3f9116130095bc4d604a8ecff90c4004103fae0

Adjustments for Non-Cash Items (USD, millions)

Stock-Based Compensation (USD, millions)

Changes in Working Capital (USD, millions)

Capital Expenditures (CapEx) (USD, millions)

Proceeds from / Repayments of Debt (USD, millions)

Share Repurchases (USD, millions)

Dividend Payments (USD, millions)

Net Change in Cash (USD, millions)

91336255f81aa85740db759c35a12c6b616c2f475beecdf27146ce1764d1b180

Northwest

Southwest

South Central

Southeast

East

North

Midwest

West

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c4addfc8e14b08144d2cc7249f2bcf1abca1d1e8d4394143a3efe006da2336a0

Revenues (USD, millions)

Cost of sales (USD, millions)

Selling, general and administrative expense (USD, millions)

Other (income) expense (USD, millions)

Income before income taxes (USD, millions)

Income tax expense (USD, millions)

Net income (USD, millions)

Net income attributable to noncontrolling interests (USD, millions)

Net income attributable to D.R. Horton, Inc. (USD, millions)

Basic net income per common share attributable to D.R. Horton, Inc. (USD)

Weighted average number of common shares (millions)

Diluted net income per common share attributable to D.R. Horton, Inc. (USD)

Adjusted weighted average number of common shares (millions)

6119a93a2cc58133d2d67b5674a279d1f00ba896b847ee5bc80acb35e5e5296b

Cash and cash equivalents (USD, millions)

Restricted cash (USD, millions)

Total cash, cash equivalents and restricted cash (USD, millions)

Total inventory (USD, millions)

Mortgage loans held for sale (USD, millions)

Deferred income taxes, net (USD, millions)

Property and equipment, net (USD, millions)

Other assets (USD, millions)

Total assets (USD, millions)

Accounts payable (USD, millions)

Accrued expenses and other liabilities (USD, millions)

Notes payable (USD, millions)

Total liabilities (USD, millions)

Common stock (USD, millions)

Additional paid-in capital (USD, millions)

Retained earnings (USD, millions)

Treasury stock (USD, millions)

Stockholders’ equity (USD, millions)

Noncontrolling interests (USD, millions)

Total equity (USD, millions)

Total liabilities and equity (USD, millions)

7b5cddc69028888357b84eed8dc191a820cac64d919de4e0590b96912a11086b

The significantly lower net income in Q2 2023 was attributed to several factors. **Lower gross profit margins** on home sales—declining to **21.6%**—combined with **increased construction costs** such as a **5% rise in lot costs** and a **1% increase per square foot in stick-and-brick costs** put considerable pressure on profitability. In addition, the **home sales gross margin declined by 730 basis points** year-over-year, and **SG&A expenses increased by 50 basis points** as a percentage of revenues, further impacting earnings. Lastly, there were declines in sales orders (down **5%** in volume and **11%** in value) and a substantial decrease in the sales order backlog (down **43%** in volume and **44%** in value) amid challenging market conditions such as elevated mortgage rates and inflation. This collective environment led to Q2 2023's significantly lower net income.  **[0000882184-23-000080_a3312023exhibit991.htm:1]** **[0000882184-23-000084_dhi-20230331.htm:4]** 

Why was net income so low in Q2 2023?

The EPS decline in Q2 2023 was driven by a **34% decrease in net income** (from **$1,436.3 million** down to **$942.2 million**) and a compression of the **pre-tax profit margin** (falling from **23.5% to 15.6%**). This decline was largely due to a **730 basis point decrease in home sales gross margin**, along with increased homebuilding SG&A expenses and higher cost of sales, even as consolidated revenues remained flat. Additionally, rising cancellation rates and lower sales orders under challenging market conditions further impacted profitability and reduced earnings per share.  **[0000882184-23-000080_a3312023exhibit991.htm:1]** **[0000882184-23-000084_dhi-20230331.htm:4]** 

What drove the EPS decline in Q2 2023?

In Q4 2023, **income before income taxes** was impacted by **revenue growth** (a 9% increase to **$10.5 billion** driven by strong **home sales** of **$8.8 billion** and significant **rental property sales** of **$1.39 billion**).  **[0000882184-23-000110_a9302023exhibit991.htm:1]** **[DHI_3364680_2]** **[0000882184-23-000110_a9302023exhibit991.htm:10]**  Additionally, **improved profit margins** played a key role, with the overall pre-tax profit margin of **19.2%** and the financial services segment achieving **38.9%** due to enhanced operational efficiency.  **[0000882184-23-000110_a9302023exhibit991.htm:1]** **[DHI_3364680_1]** **[DHI_3364680_9]**  The company also benefited from **cost management** measures where the **cost of sales** increased at a slower rate than revenues and **selling, general, and administrative expenses** remained proportionate to revenue growth.  **[0000882184-23-000110_a9302023exhibit991.htm:10]**  Finally, the impact of **other income** amounting to **$81.2 million** further contributed to the strong pre-tax income performance.  **[0000882184-23-000110_a9302023exhibit991.htm:10]** 

What factors impacted income before taxes in Q4 2023?

In **fiscal year 2023**, D.R. Horton’s full-year net income declined mainly because of a **decrease in pre-tax income** from **$7.6 billion** to **$6.3 billion** along with a reduction in the **pre-tax operating margin** from **22.8%** to **17.8%**. In addition, the company experienced a **lower return on equity (ROE)**, which fell from **34.5%** in FY 2022 to **22.7%** in FY 2023. There was also some impact from **competitive pricing pressure in the secondary market**, which led to slightly decreased revenues from mortgage operations despite higher loan origination volume.  **[0000882184-23-000110_a9302023exhibit991.htm:1]** **[0000882184-23-000115_dhi-20230930.htm:44]** **[0000882184-23-000115_dhi-20230930.htm:57]** 

Why did full-year net income decline in FY 2023?

In Q3 2023, **D.R. Horton**’s revenue jump was driven by several factors: an increase in home sales revenues by **5%** to **$8.7 billion**, fueled by an **8%** increase in the number of homes closed (rising from **21,308** to **22,985**), a remarkable **37%** growth in net sales orders alongside a **26%** rise in order value, and additional contributions from rental operations with notable pre-tax income. These factors together contributed to an overall revenue increase of **11%** to **$9.7 billion**.  **[DHI_3254973_1]** **[0000882184-23-000089_a6302023exhibit991.htm:1]** **[DHI_3254973_2]** 

What contributed to the revenue jump in Q3 2023?

f99d4438430088ec0a7d46378d72544e2790ca1e45de9ffe4169e18163ba3b95

The decline in **cash and cash equivalents** in Q1 2024 was primarily driven by two factors. First, there was significant **net cash used in operating activities**, particularly in the rental and Forestar segments, despite some offset from the homebuilding segment. Second, the company saw a substantial **increase in inventory**, with higher investments in construction in progress, finished home inventory, and residential land and lots. These factors together resulted in the reduction of cash balances during the period.  **[0000882184-24-000022_a3312024exhibit991.htm:9]** **[0000882184-24-000022_a3312024exhibit991.htm:7]** 

Why did Cash and cash equivalents decline in Q1 2024?

In Q4 2023, the change in deferred income taxes was primarily driven by adjustments in temporary differences between the financial statement bases and the tax bases of assets and liabilities. The documents point to several factors, including the **deferral of profit on home closings**, **changes in depreciation schedules for fixed assets**, and **other temporary differences** (encompassing warranty and construction defect costs, incentive compensation plans, and inventory costs) that collectively led to the significant change in the net deferred tax balance.  **[0000882184-24-000009_a12312023exhibit991.htm:7]** **[0000882184-24-000014_dhi-20231231.htm:8]** **[0000882184-23-000115_dhi-20230930.htm:105]** **[0000882184-24-000009_a12312023exhibit991.htm:5]** 

What caused the spike in deferred income taxes in Q4 2023?

The significant drop in **Notes payable** in Q4 2023 was driven by multiple factors. **Repayment of senior notes** played a role, with the company repaying **$400 million** during the quarter.  **[DHI_3364680_10]**  Additionally, there was a **reduction in unsecured notes**, as the 4.75% and 5.75% senior notes due in 2023, amounting to **$299.9 million** and **$399.6 million** respectively, were eliminated.  **[0000882184-23-000115_dhi-20230930.htm:96]**  Finally, adjustments in **mortgage repurchase facilities**—specifically, a decrease in the committed facility from **$1,618.3 million** in 2022 to **$1,373.3 million** in 2023 and the introduction of an uncommitted facility of **$296.3 million**—also contributed to the overall reduction in the balance.  **[0000882184-23-000115_dhi-20230930.htm:96]** 

What factors led to the significant drop in Notes payable in Q4 2023?

54bda1568dcc9f5d59b64f8097f2699c62e43b34ee9588b1d6eb1170bbdf02f4

Depreciation and amortization (USD, millions)

Stock-based compensation expense (USD, millions)

Deferred income taxes (USD, millions)

Inventory and land option charges (USD, millions)

Decrease (increase) in construction in progress and finished homes (USD, millions)

Increase in residential land and lots – developed, under development, held for development and held for sale (USD, millions)

Increase in rental properties (USD, millions)

Decrease (increase) in other assets (USD, millions)

Decrease in mortgage loans held for sale (USD, millions)

Increase in accounts payable, accrued expenses and other liabilities (USD, millions)

Net cash provided by (used in) operating activities (USD, millions)

Expenditures for property and equipment (USD, millions)

Proceeds from sale of assets (USD, millions)

Payments related to business acquisitions, net of cash acquired (USD, millions)

Other investing activities (USD, millions)

Net cash used in investing activities (USD, millions)

Proceeds from notes payable (USD, millions)

Repayment of notes payable (USD, millions)

Proceeds from stock associated with certain employee benefit plans (USD, millions)

Cash paid for shares withheld for taxes (USD, millions)

Cash dividends paid (USD, millions)

Repurchases of common stock (USD, millions)

Net other financing activities (USD, millions)

Net cash used in financing activities (USD, millions)

Net decrease in cash, cash equivalents and restricted cash (USD, millions)

Net proceeds from issuance of Forestar common stock (USD, millions)

(Repayment) borrowings on mortgage repurchase facilities, net (USD, millions)

Cash, cash equivalents and restricted cash at beginning of period (USD, millions)

Cash, cash equivalents and restricted cash at end of period (USD, millions)

9e1c180bf99ab64ccf34bd9223d6dad163f9de6ef29350d095e57a3edd0ab7b7

f98f05e2b0cafdef630f39e17bd87d673c6712966eb222c4d2d0e200b448834f

ec1f159c87971b48a106148f8a528bcd9434ef0659a5fb1117469bd37d3b4d28

DR Horton Inc (DHI)

Financials