Exhibit 99.1
Investor and Media Contact: Steve Zenker
(239) 498-8066
stevezenker@wcicommunities.com
FOR IMMEDIATE RELEASE
WCI Releases Fourth Quarter and Full Year 2006 Earnings
Financial Highlights:
| | · | | Full year 2006 net income: $9.0 million |
| | · | | Full year 2006 diluted EPS: $0.21 |
| | · | | Full year 2006 figures include $139.5 million of pre-tax asset impairments & write-offs |
| | · | | Full-year 2006 diluted EPS before impairments and write-downs: $2.16 |
| | · | | Fourth quarter net income: loss of $64.6 million |
| | · | | Fourth quarter diluted EPS: loss of $1.52 |
| | · | | Fourth quarter figures include $118.3 million of pre-tax asset impairments & write-offs |
| | · | | Fourth quarter diluted EPS before impairments and write-offs: $0.18 |
| | · | | 2006 year-end backlog: $911.2 million vs. $2.05 billion in 2005 |
| | · | | Projected 2007 cash flow from operations of approximately $1 billion |
| | · | | Projected year-end 2007 net debt to capital ratio of approximately 50% |
Bonita Springs, FL (February 27, 2007) – WCI Communities, Inc. (NYSE: WCI), a leading builder of traditional and tower residences in highly amenitized lifestyle communities, today reported its results for the fourth quarter and full year ended December 31, 2006. For the twelve months ended December 31, 2006, net income fell to $9.0 million compared with $186.2 million in 2005, while diluted earnings per share (EPS) declined to $0.21 from $4.00 a year ago. If $139.5 million in pre-tax charges for asset impairments and land acquisition termination costs (collectively “Write-offs”) were excluded, EPS would have approximated $2.16. Revenues for 2006 totaled $2.05 billion vs. $2.60 billion a year ago. Overall company gross margin for 2006 equaled 12.2% or 19.0% before Write-offs. In 2005, the total company gross margin was 23.0%.
For the fourth quarter, the company reported a net loss of $64.6 million compared with net income of $54.6 million for the fourth quarter of 2005. Diluted EPS for the quarter was a net loss of $1.52 versus net income of $1.20 in the same period a year ago. Net income and EPS before Write-offs of $118.3 million totaled $6.6 million and $0.18, respectively. Revenues for the fourth quarter of 2006 decreased to $526.3 million as compared with $843.4 million in the fourth quarter of 2005 as the
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result of lower sales during 2006, contract cancellations and defaults. Overall company gross margin as a percentage of revenue for the fourth quarter of 2006 was negative. Excluding Write-offs, company gross margin as a percentage of revenue for the fourth quarter of 2006 was 14.4% versus 22.9% in the fourth quarter of 2005.
“The past year was extremely challenging as consumer sentiment became progressively more negative leading to a severe decrease in demand and ultimately a sharp spike in cancellations and defaults,” said Jerry Starkey, President and CEO of WCI Communities. “Rising inventories of unsold new and existing homes in all of our markets led to greater use of incentives and discounts thereby reducing margins in all WCI markets.”
“During the fourth quarter, we recorded real estate inventory impairment losses totaling $91.4 million. At one community in Southwest Florida, a revised product and marketing plan introduced earlier in the year failed to produce sales as expected, which led us to conclude that additional pricing reductions were needed, which resulted in an impairment charge of approximately $84.9 million. The remaining inventory impairment charges related to price reductions implemented at various communities to sell out remaining finished inventory. Additionally, we re-evaluated all remaining contracted options to purchase additional land or lots and wrote off a total of $26.9 million during the quarter reflecting forfeited deposits, pre-acquisition costs, and estimated future payments for projects previously pursued that no longer make economic sense in today’s housing market. In aggregate, the fourth quarter Write-offs of $118.3 million significantly reduced our fourth quarter and full year earnings.”
Starkey continued, “Our Florida markets, which account for approximately 85% of our business, experienced the greatest slowdown during 2006. While traffic in Florida increased sequentially in January 2007 as compared to December 2006, it was nevertheless about 35% lower than January of 2006. Year-to-date 2007, we have seen a drop in Florida’s Traditional Homebuilding cancellation rate, which has moved down to our historical average of 20%. Traffic always tends to pick up this time of the year in Florida and it is too early to gauge demand trends.”
“Our principle business focus in 2007 is on maximizing cash flow, reducing debt, and improving our financial flexibility. We expect to generate approximately $1 billion of cash flow from operations during 2007. While all aspects of our business will contribute to this cash flow objective, completing
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and closing nine towers during the year is the primary driver. We expect around $1 billion in collections from the closing of those nine towers and from the closing of the remaining sold units from three towers that were completed in December 2006. The default rate for towers that closed during 2006, and particularly during the fourth quarter, was higher than our estimate and historical average, but generally lower than many analyst and investors predicted. Taking into consideration our recent tower closing experience and the individual locations and mix of sold units, we estimate that our tower defaults during 2007 will range from 8% to 10% in aggregate. As we close towers and collect the receivables, we expect to reduce our debt significantly, and ultimately lower our net debt to capital by year-end 2007 to about 50% from our year-end 2006 level of 66%. During 2006, we significantly reduced our overhead in response to lower demand and in 2007 we continue to focus on reducing construction costs, achieving additional operating efficiencies, and will sharply reduce spending on land and land improvement.”
Earlier this month, the company announced the retention of Goldman Sachs to assist the Board and senior management in a thorough review of WCI’s business plans, capital structure, and growth prospects, with the objective of enhancing value for all shareholders. Starkey added, “We are fully engaged with Goldman Sachs in the process to identify and evaluate a range of strategic alternatives most likely to increase shareholder value.”
For the year ended December 31, 2006, the aggregate value of Traditional and Tower Homebuilding gross orders declined 55.9% to $1.05 billion over the same period a year ago while net orders declined 71.0% to $653.8 million. The number of gross unit orders declined 54.6% to 1,371, with net unit orders dropping 70.5% to 815. For the full year 2006, the average price of Traditional and Tower Homebuilding net orders combined averaged $802,000, slightly down from last year’s average of $815,000, reflecting a smaller percentage of tower orders in the overall mix as well as mix changes in Traditional Homebuilding orders, including a higher contribution from the company’s Northeast Division. The aggregate value and number of new Traditional and Tower Homebuilding net orders for the fourth quarter were negative, due to cancellations and defaults of 276 outnumbering gross orders of 262. The company’s combined Traditional and Tower Homebuilding year-end backlog was $911.2 million, down 55.6% from the $2.05 billion reported a year earlier.
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Traditional Homebuilding
For the year ended December 31, 2006, Traditional Homebuilding revenues declined 8.3% to $1.11 billion from $1.21 billion for 2005. The company closed 1,577 homes compared with 2,346 for the same period a year ago. Gross margin as a percentage of revenue totaled 10.8% for 2006. Excluding Write-offs, gross margin as a percent of revenue was 21.7% as compared with 18.5% for 2005.
Fourth quarter 2006 revenues in the Traditional Homebuilding Division were $349.5 million, down 21.0% from the $442.6 million posted in the fourth quarter of 2005 primarily because approximately 22% of contract purchasers scheduled to close defaulted this quarter, compared to an approximate 1% default rate in the fourth quarter of 2005. Fourth quarter unit deliveries totaled 434 compared with 859 during the same period last year. Gross margin as a percent of revenue was negative for the quarter, due to a total of $113.2 million of Write-offs. Absent these charges, gross margin as a percent of revenue equaled 18.9% versus 20.7% in the fourth quarter of 2005.
For 2006, the number of gross orders in the Traditional Homebuilding Division totaled 1,260 compared with 2,051 for 2005, while the number of net orders dropped to 750 from 1,795. The average sales price for Traditional Homebuilding orders for 2006 was $738,000 compared with $675,000 in 2005. The traditional home cancellation rate for the year was 40.5% compared to a long-term average cancellation rate of around 20%. Traditional Homebuilding gross orders for the fourth quarter 2006 totaled 257 units and were almost entirely offset by 249 cancellations, including 187 defaults of units in backlog scheduled for Q4 2006 settlement, resulting in only eight net orders for the period. Traditional Homebuilding backlog ended the year at $682.6 million, compared to year-end 2005 backlog of $1.19 billion.
Tower Homebuilding
For 2006, revenues in the Tower Homebuilding Division fell 29.9% to $729.5 million from $1.04 billion a year ago, as 14 towers were completed during the year and no new towers were started. Gross margin as a percentage of revenue declined to 19.2% from 26.0% in 2005,due principally to cost adjustments related to finished towers or towers under construction during the year, as well as higher interest charges due to longer tower construction cycles.
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Fourth quarter 2006 revenues for the Tower Homebuilding Division declined 63.6% to $123.4 million from $339.3 million in the fourth quarter of 2005. No new towers began recognition of revenue during the quarter. Overall, 17 towers were under construction and recognizing revenue during the quarter compared with 25 in the same period a year ago. During each quarter, the company reviews the cost estimates for each tower under construction and makes adjustments to reflect actual increases or decreases in current and expected future costs. Unfavorable adjustments booked for the fourth quarter of 2006 for towers that were completed or are under construction totaled $21.5 million, including an $11.3 million increase in the default reserve for future tower closings to approximately 8% of sold units versus our prior expectation of 5%. Longer tower construction cycles resulted in $8.4 million of expected incremental interest and insurance costs. Due primarily to these adjustments during the period, gross margin as a percentage of revenue decreased to 7.9% from 27.1% in the same period last year.
Tower Homebuilding gross orders for 2006 decreased to 111 from the 968 recorded in 2005, while net orders were 65 and 966 for 2006 and 2005, respectively. The number of defaults for the year totaled 46 out of 713 units expected to close. In addition, as of the date of this release, 17 sold units in buildings that were recently completed have not yet closed. The company has reserved for 12 defaults of those 17 remaining units, which if realized, would result in a default rate of 8.1% for the year. The average sales price for Tower Homebuilding units sold in 2006 was $1.5 million compared with $1.1 million in 2005. The net number of new tower orders for the quarter was negative 22, as defaults of 27 outnumbered gross new orders of five. For the quarter, there were 27 defaults recorded out of 302 expected to close. The default rate would be 12.9% if the 12 defaults reserved for actually defaulted. Tower Homebuilding backlog at the end of 2006 totaled $228.6 as compared with $857.9 million at the end of 2005.
Real Estate Services
For the year ended December 31, 2006, Real Estate Services Division revenues totaled $109.4 million, down 30.2% from the $156.7 million recorded for the year ended December 31, 2005. Gross margin as a percentage of revenue over the period decreased to 5.0% from 15.5% in the same period a year ago, due to the drop in transaction volume as a result of the slowdown in the housing market.
Fourth quarter 2006 Real Estate Services Division revenues totaled $22.3 million, down 20.9% from $28.2 million recorded for the fourth quarter of 2005. Fourth quarter 2006 gross margin as a
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percentage of revenue was negative versus 7.4% in the same period a year ago. The decline in revenues and gross margin percentage experienced in the fourth quarter of 2006 versus the prior year was also due to a drop in transaction volume.
Other Items
The Amenities Division experienced a loss of $7.8 million for the full year 2006, and a loss of $6.4 for the fourth quarter versus a loss of $3.8 million for 2005 and a slight gain in the fourth quarter of 2005. Both 2006 periods were affected by asset impairment charges totaling $4.5 million due to the inability to realize planned revenue in a 22-unit marina that was constructed in conjunction with a Palm Beach tower.
Land sale revenues for 2006 totaled $11.7 million, including revenues of $4.2 million in the fourth quarter, compared with revenues of $110.3 million and $9.4 million, respectively, for the full year and fourth quarter periods of 2005. Gross margin as a percentage of revenue for land sales equaled 57.8% and 48.8% for the full year 2006 and fourth quarter, respectively, versus 76.6% and 77.3% in the year earlier periods.
Other income and hurricane recoveries, net of expenses, for 2006 totaled $12.8 million, including $1.1 million in the fourth quarter. In 2005, the items totaled $6.5 million for the year and resulted in a $801,000 loss for the fourth quarter of that year, due to hurricane costs. Interest expense for the year ended December 31, 2006 was $35.6 million compared with $35.8 million in 2005 and fourth quarter interest expense increased to $16.5 million from $10.8 million in the same period a year ago.
Selling, general, and administrative expenses, including real estate taxes, (SG&A) as a percentage of revenue for 2006 was 9.4%, up from 8.3% in 2005. For the fourth quarter of 2006, SG&A was 8.5%, compared with 7.2% in the fourth quarter of the previous year, although SG&A dollars declined $16.0 million versus the year-ago period, as the company’s cost reduction efforts began to be realized.
The effective tax rate for year ended December 31, 2006 was 5.7% versus 39.1% in 2005. The reduction in the effective tax rate for 2006 was primarily due to a recurring manufacturing tax credit and recognition of approximately $3 million in tax benefits from tax positions asserted in prior year tax returns on which the statute of limitations has expired. The company expects its tax rate going forward to approximate 39%.
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Cash Flow/Financial Position/Balance Sheet
For the year ended December 31, 2006, net cash used in operating activities, including the purchase and development of real estate inventories, totaled $489.6 million compared with cash used in operating activities of $8.9 million in the same period a year ago. Excluding land purchases of approximately $54.9 million, operating activities used net cash flow of approximately $434.7 million.
Total liquidity, measured as the sum of cash plus available capacity under the unsecured revolving facility, totaled approximately $468.1 million at December 31, 2006 based upon the maximum amount available to borrow under the company’s senior unsecured revolving credit facility of $930 million. The ratio of net debt to net capitalization of was 66.3% compared with 55.1% at December 31, 2005. The company expects the ratio to decline to approximately 50.0% by the end of 2007, as tower closings are expected to generate approximately $1.0 billion, reducing total company debt by a similar amount.
Capped Call Options to Repurchase WCI Stock
During the fourth quarter of 2006, the company invested $25.7 million of equity in capped call options that give it the right to repurchase up to 5,000,000 shares of WCI common stock at an average price of $13.63. The company may choose to settle the derivative contracts in cash, in which case it would receive payment of the difference between the share price at the maturity date and an average exercise price of $13.63. The exercise price would rise dollar-for-dollar once the cap, averaging $25.55, is reached. Settlement is required to occur at the maturity date of one year from the derivative contract dates, which range between mid-September and mid-October 2007. Under certain circumstances, the derivative contracts may be unwound in advance of the maturity date. If the company elects to unwind the capped call option contracts, provided that the share price is above the exercise price, the company would receive a cash amount determined by a calculation that takes into account the spread between the share price and the exercise price and the length of time between termination and maturity of the contracts. Based upon the closing price of $21.68 on February 23, 2007, the estimated value if unwound would be approximately $34.5 million.
Conference Call
WCI will conduct a conference call today at 9:30 AM EST in conjunction with this release. The call will be broadcast live athttp://www.wcicommunities.com in the Investor Relations area or can be
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accessed by telephone at (303) 262-2194 and asking for the WCI Communities conference call. A replay will be available after the call for a period of 36 hours by dialing (303) 590-3000 and entering conference code 11083834. The replay will also be available on the company’s website. A slide presentation will accompany the call and can be accessed on the company’s website in the Investor Relations section.
About WCI
WCI Communities, Inc., named America’s Best Builder in 2004 by the National Association of Home Builders and Builder Magazine, has been creating amenity-rich, master-planned lifestyle communities since 1946. Florida-based WCI caters to primary, retirement, and second-home buyers in Florida, New York, New Jersey, Connecticut, Maryland and Virginia. The company offers traditional and tower home choices with prices from the high-$100,000s to more than $10 million and features a wide array of recreational amenities in its communities. In addition to homebuilding, WCI generates revenues from its Prudential Florida WCI Realty Division and its recreational amenities, as well as through land sales and joint ventures. The company currently owns and controls developable land on which the company plans to build about 20,000 traditional and tower homes.
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For more information about WCI and its residential communities
visit www.wcicommunities.com
Certain information included herein and in other company reports, Securities and Exchange Commission filings, statements and presentations is forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements about the company’s anticipated operating results, financial resources, ability to acquire land, ability to sell homes and properties, ability to deliver homes from backlog, and ability to secure materials and subcontractors. Such forward-looking information involves important risks and uncertainties that could significantly affect actual results and cause them to differ materially from expectations expressed herein and in other company reports, filings, statements and presentations. These risks and uncertainties include WCI’s ability to compete in real estate markets where we conduct business; the availability and cost of land in desirable areas in its geographic markets and elsewhere and our ability to expand successfully into those areas; WCI’s ability to obtain necessary permits and approvals for the development of its lands; the availability of capital to WCI and our ability to effect growth strategies successfully; WCI’s ability to pay principal and interest on its current and future debts; WCI’s ability to comply with outstanding debt agreements/covenants; S&P and/or Moody’s downgrades; WCI’s ability to maintain or increase historical revenues and profit margins; availability of labor and materials and material increases in labor and material costs; increases in interest rates and availability of mortgage financing; the level of consumer confidence; increased customer cancellations or defaults; adverse legislation or regulations; unanticipated litigation or legal proceedings; changes in accounting rules, including changes in percentage of completion accounting; natural disasters; lack of visibility in the marketplace and inability to gauge timing of market turnarounds; and changes in general economic, real estate and business conditions. If one or more of the assumptions underlying our forward-looking statements proves incorrect, then the company’s actual results, performance or achievements could differ materially from those expressed in, or implied by the forward-looking statements contained in this report. Therefore, we caution you not to place undue reliance on our forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This statement is provided as permitted by the Private Securities Litigation Reform Act of 1995.
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WCI Communities, Inc.
Condensed Consolidated Balance Sheets
(Dollars in thousands)
| | | | | | | | |
| | | December 31, 2006 | | | December 31, 2005 | |
Assets | | | | | | | | |
| | |
Cash and cash equivalents | | $ | 41,876 | | | $ | 52,584 | |
Contracts receivable | | | 1,269,549 | | | | 1,123,509 | |
Real estate inventories | | | 1,955,793 | | | | 1,687,852 | |
Property and equipment | | | 274,720 | | | | 208,205 | |
Other assets | | | 289,921 | | | | 409,256 | |
| | | | | | | | |
Total assets | | $ | 3,831,859 | | | $ | 3,481,406 | |
| | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | | |
| | |
Accounts payable, accruals and other liabilities | | $ | 862,353 | | | $ | 1,070,047 | |
| | | | | | | | |
Debt obligations: | | | | | | | | |
Senior unsecured credit facility | | | 503,846 | | | | 94,050 | |
Senior unsecured term note | | | 300,000 | | | | 300,000 | |
Mortgages and notes payable | | | 363,261 | | | | 203,214 | |
Senior subordinated notes | | | 525,000 | | | | 530,473 | |
Junior subordinated notes | | | 165,000 | | | | 100,000 | |
Contingent convertible senior subordinated notes | | | 125,000 | | | | 125,000 | |
| | | | | | | | |
Total debt obligations | | | 1,982,107 | | | | 1,352,737 | |
| | | | | | | | |
Total shareholders’ equity | | | 987,399 | | | | 1,058,622 | |
| | | | | | | | |
Total liabilities and shareholders’ equity | | $ | 3,831,859 | | | $ | 3,481,406 | |
| | | | | | | | |
Other Balance Sheet Data | | | | | | | | |
Debt | | $ | 1,982,107 | | | $ | 1,352,737 | |
Shareholders’ equity | | | 987,399 | | | | 1,058,622 | |
| | | | | | | | |
Capitalization | | $ | 2,969,506 | | | $ | 2,411,359 | |
| | | | | | | | |
Ratio of debt to capitalization | | | 66.7 | % | | | 56.1 | % |
Debt, net of cash and cash equivalents | | $ | 1,940,231 | | | $ | 1,300,153 | |
Shareholders’ equity | | | 987,399 | | | | 1,058,622 | |
| | | | | | | | |
Capitalization, net of cash and cash equivalents | | $ | 2,927,630 | | | $ | 2,358,775 | |
| | | | | | | | |
Ratio of net debt to net capitalization | | | 66.3 | % | | | 55.1 | % |
Shareholders’ equity per share | | $ | 23.57 | | | $ | 23.86 | |
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WCI Communities, Inc.
Selected Revenues and Earnings Information
(Dollars in thousands, except per share data)
| | | | | | | | | | | | | | | | |
| | | For the three months ended
December 31, | | | For the twelve months ended
December 31, | |
| | | 2006 | | | 2005 | | | 2006 | | | 2005 | |
REVENUES | | | | | | | | | | | | | | | | |
Homebuilding: | | | | | | | | | | | | | | | | |
Homes | | $ | 330,855 | | | $ | 440,952 | | | $ | 1,068,393 | | | $ | 1,181,678 | |
Lots | | | 18,619 | | | | 1,633 | | | | 38,093 | | | | 31,328 | |
| | | | | | | | | | | | | | | | |
Total traditional | | | 349,474 | | | | 442,585 | | | | 1,106,486 | | | | 1,213,006 | |
Towers | | | 123,363 | | | | 339,312 | | | | 729,516 | | | | 1,035,747 | |
| | | | | | | | | | | | | | | | |
Total homebuilding | | | 472,837 | | | | 781,897 | | | | 1,836,002 | | | | 2,248,753 | |
Real estate services | | | 22,339 | | | | 28,226 | | | | 109,421 | | | | 156,740 | |
Amenity membership and operations | | | 24,995 | | | | 21,804 | | | | 88,528 | | | | 78,618 | |
Land sales | | | 4,221 | | | | 9,431 | | | | 11,739 | | | | 110,330 | |
Other | | | 1,883 | | | | 2,046 | | | | 8,008 | | | | 7,369 | |
| | | | | | | | | | | | | | | | |
Total revenues | | | 526,275 | | | | 843,404 | | | | 2,053,698 | | | | 2,601,810 | |
| | | | | | | | | | | | | | | | |
| | | | |
GROSS MARGIN | | | | | | | | | | | | | | | | |
Homebuilding: | | | | | | | | | | | | | | | | |
Homes | | | (48,369 | ) | | | 91,221 | | | | 113,339 | | | | 215,959 | |
Lots | | | 1,270 | | | | 463 | | | | 6,402 | | | | 8,628 | |
| | | | | | | | | | | | | | | | |
Total traditional | | | (47,099 | ) | | | 91,684 | | | | 119,741 | | | | 224,587 | |
Towers | | | 9,711 | | | | 91,952 | | | | 139,816 | | | | 269,255 | |
| | | | | | | | | | | | | | | | |
Total homebuilding | | | (37,388 | ) | | | 183,636 | | | | 259,557 | | | | 493,842 | |
Real estate services | | | (494 | ) | | | 2,091 | | | | 5,431 | | | | 24,271 | |
Amenity membership and operations | | | (6,354 | ) | | | 25 | | | | (7,821 | ) | | | (3,795 | ) |
Land sales | | | 2,060 | | | | 7,292 | | | | 6,789 | | | | 84,513 | |
Other | | | (245 | ) | | | (251 | ) | | | (13,578 | ) | | | (112 | ) |
| | | | | | | | | | | | | | | | |
Total gross margin (1) | | | (42,421 | ) | | | 192,793 | | | | 250,378 | | | | 598,719 | |
| | | | | | | | | | | | | | | | |
| | | | |
OTHER INCOME AND EXPENSES | | | | | | | | | | | | | | | | |
Equity in (earnings) losses from joint ventures | | | (211 | ) | | | 558 | | | | 603 | | | | 1,386 | |
Other income | | | (917 | ) | | | (5,887 | ) | | | (6,165 | ) | | | (10,804 | ) |
Hurricane (recoveries) costs, net | | | (211 | ) | | | 6,688 | | | | (6,646 | ) | | | 4,324 | |
Selling, general and administrative, including real estate taxes, net | | | 44,507 | | | | 60,509 | | | | 193,218 | | | | 215,632 | |
Depreciation and amortization | | | 5,882 | | | | 4,354 | | | | 24,592 | | | | 16,037 | |
Interest expense, net | | | 16,497 | | | | 10,800 | | | | 35,600 | | | | 35,816 | |
Expenses related to early repayment of debt | | | — | | | | 21,872 | | | | 455 | | | | 26,167 | |
| | | | | | | | | | | | | | | | |
(Loss) income before minority interests and income taxes | | | (107,968 | ) | | | 93,899 | | | | 8,721 | | | | 310,161 | |
Minority interests | | | (579 | ) | | | 2,563 | | | | (837 | ) | | | 4,537 | |
Income tax (benefit) expense | | | (42,827 | ) | | | 36,777 | | | | 544 | | | | 119,474 | |
| | | | | | | | | | | | | | | | |
Net (loss) income | | $ | (64,562 | ) | | $ | 54,559 | | | $ | 9,014 | | | $ | 186,150 | |
| | | | | | | | | | | | | | | | |
| | | | |
(LOSS) EARNINGS PER SHARE | | | | | | | | | | | | | | | | |
Basic | | $ | (1.55 | ) | | $ | 1.23 | | | $ | 0.21 | | | $ | 4.15 | |
Diluted | | $ | (1.52 | ) | | $ | 1.20 | | | $ | 0.21 | | | $ | 4.00 | |
| | | | |
WEIGHTED AVERAGE NUMBER OF SHARES | | | | | | | | | | | | | | | | |
Basic | | | 41,766 | | | | 44,330 | | | | 42,629 | | | | 44,805 | |
Diluted | | | 42,421 | | | | 45,486 | | | | 43,449 | | | | 46,579 | |
| | | | |
OPERATING DATA | | | | | | | | | | | | | | | | |
Interest incurred, excluding warehouse credit facility | | $ | 38,621 | | | $ | 30,456 | | | $ | 128,964 | | | $ | 106,859 | |
Interest included in cost of sales | | $ | 23,566 | | | $ | 26,847 | | | $ | 74,030 | | | $ | 73,070 | |
| (1) | Total gross margin for the three and twelve months ended December 31, 2006 includes asset impairment charges and land acquisition termination costs of $118,281 and $139,519 respectively. |
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WCI Communities, Inc.
Non-GAAP Financial Measures
(Dollars in thousands, except per share data)
| | | | | | | | | | | | | | | | |
| | | For the three months ended December 31, | | | For the twelve months ended December 31, | |
| | | 2006 | | | 2005 | | | 2006 | | | 2005 | |
Gross Margin Reconciliation | | | | | | | | | | | | | | | | |
Total gross margin—as reported | | $ | (42,421 | ) | | $ | 192,793 | | | $ | 250,378 | | | $ | 598,719 | |
Add: Asset impairments | | | 91,418 | | | | — | | | | 98,156 | | | | — | |
Add: Land acquisition termination costs | | | 26,863 | | | | — | | | | 41,363 | | | | — | |
| | | | | | | | | | | | | | | | |
Total gross margin excluding asset impairment and land acquisition termination charges | | $ | 75,860 | | | $ | 192,793 | | | $ | 389,897 | | | $ | 598,719 | |
| | | | |
Net Income Reconciliation | | | | | | | | | | | | | | | | |
(Loss) income before income taxes—as reported | | $ | (107,389 | ) | | $ | 91,336 | | | $ | 9,558 | | | $ | 305,624 | |
Add: Asset impairments | | | 91,418 | | | | — | | | | 98,156 | | | | — | |
Add: Land acquisition termination costs | | | 26,863 | | | | — | | | | 41,363 | | | | — | |
| | | | | | | | | | | | | | | | |
Income before income taxes excluding asset impairment and land acquisition termination charges | | | 10,892 | | | | 91,336 | | | | 149,077 | | | | 305,624 | |
Income tax expense | | | (4,264 | ) | | | (36,777 | ) | | | (58,364 | ) | | | (119,474 | ) |
| | | | | | | | | | | | | | | | |
Net income excluding asset impairment and land acquisition termination charges | | $ | 6,628 | | | $ | 54,559 | | | $ | 90,713 | | | $ | 186,150 | |
| | | | | | | | | | | | | | | | |
| | | | |
Diluted Earnings Per Share Reconciliation | | | | | | | | | | | | | | | | |
Diluted Earnings Per Share—as reported | | $ | (1.52 | ) | | $ | 1.20 | | | $ | 0.21 | | | $ | 4.00 | |
Add: Asset impairments | | | 1.31 | | | | — | | | | 1.37 | | | | — | |
Add: Land acquisition termination costs | | | 0.39 | | | | — | | | | 0.58 | | | | — | |
| | | | | | | | | | | | | | | | |
Diluted Earnings Per Share—excluding asset impairment and land acquisition termination charges | | $ | 0.18 | | | $ | 1.20 | | | $ | 2.16 | | | $ | 4.00 | |
| | | | | | | | | | | | | | | | |
Weighted Average Number of Shares | | | | | | | | | | | | | | | | |
Diluted | | | 42,421 | | | | 45,486 | | | | 43,449 | | | | 46,579 | |
| | | |
Reconciliation of EBITDA and Other Non-Cash Items | | | | | | | | | | | | | |
(Loss) income before income taxes—as reported | | $ | (107,389 | ) | | $ | 91,336 | | | $ | 9,558 | | | $ | 305,624 | |
Add: Interest expense, net | | | 16,497 | | | | 10,800 | | | | 35,600 | | | | 35,816 | |
Add: Interest expense included in cost of sales | | | 23,566 | | | | 26,847 | | | | 74,030 | | | | 73,070 | |
Add: Depreciation and amortization | | | 5,882 | | | | 4,354 | | | | 24,592 | | | | 16,037 | |
Add: Asset impairment charges | | | 91,418 | | | | — | | | | 98,156 | | | | — | |
Add: Land acquisition termination charges | | | 26,863 | | | | — | | | | 41,363 | | | | — | |
Add: Expenses related to early repayment of debt | | | — | | | | 21,872 | | | | 455 | | | | 26,167 | |
| | | | | | | | | | | | | | | | |
EBITDA | | $ | 56,837 | | | $ | 155,209 | | | $ | 283,754 | | | $ | 456,714 | |
| | | | | | | | | | | | | | | | |
Earnings before interest expense, income taxes, depreciation and amortization (EBITDA) is not a generally accepted accounting principle (GAAP) financial statement measurement. EBITDA should not be considered an alternative to cash flows from operations determined in accordance with GAAP as a measure of liquidity. The Company’s management believes that EBITDA is an indication of the Company’s ability to generate funds from operations that are available to pay principal and interest on debt obligations and to meet other cash needs.
Gross margin, net income and diluted earnings per share before asset impairment and land acquisition termination charges are non-GAAP financial statement measures. The Company's management believes that providing these captions excluding these charges provides financial statement users with meaningful information that is relevant to the Company's ongoing operations.
-11-
WCI Communities, Inc.
Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
| | | | | | | | |
| | | For the twelve months ended
December 31, | |
| | | 2006 | | | 2005 | |
Cash flows from operating activities: | | | | | | | | |
Net income | | $ | 9,014 | | | $ | 186,150 | |
Asset impairment and land acquisition termination charges | | | 121,516 | | | | — | |
Increase in real estate inventories | | | (372,669 | ) | | | (58,288 | ) |
Increase in contracts receivable | | | (146,040 | ) | | | (365,103 | ) |
(Decrease) increase in customer deposits | | | (106,332 | ) | | | 70,227 | |
Decrease in restricted cash | | | 65,815 | | | | 51,591 | |
(Decrease) increase in accounts payable and other liabilities | | | (46,269 | ) | | | 27,076 | |
Other | | | (14,644 | ) | | | 79,403 | |
| | | | | | | | |
Net cash used in operating activities | | | (489,609 | ) | | | (8,944 | ) |
| | | | | | | | |
| | |
Cash flows from investing activities: | | | | | | | | |
Net cash paid for acquisition | | | — | | | | (136,558 | ) |
Additions to property and equipment, net | | | (41,178 | ) | | | (50,049 | ) |
Other | | | (5,852 | ) | | | 22,715 | |
| | | | | | | | |
Net cash used in investing activities | | | (47,030 | ) | | | (163,892 | ) |
| | | | | | | | |
| | |
Cash flows from financing activities: | | | | | | | | |
Net borrowings under debt obligations | | | 630,501 | | | | 184,230 | |
Other | | | (104,570 | ) | | | (20,802 | ) |
| | | | | | | | |
Net cash provided by financing activities | | | 525,931 | | | | 163,428 | |
| | | | | | | | |
Net decrease in cash and cash equivalents | | $ | (10,708 | ) | | $ | (9,408 | ) |
| | | | | | | | |
- 12 -
WCI Communities, Inc.
Homebuilding Operational Data
(Dollars in thousands)
| | | | | | | | | | | | | | | | |
| | | For the three months ended December 31, | | | For the twelve months ended December 31, | |
| | | 2006 | | | 2005 | | | 2006 | | | 2005 | |
| Combined Traditional and Tower Homebuilding | | | | | | | | | | | | | | | | |
Homes Closed (Units)* | | | 668 | | | | 1,026 | | | | 2,215 | | | | 2,909 | |
Net New Orders (Units) | | | (14 | ) | | | 334 | | | | 815 | | | | 2,761 | |
Net Contract Values of New Orders | | $ | (39,432 | ) | | $ | 321,921 | | | $ | 653,783 | | | $ | 2,250,591 | |
Average Selling Price Per New Order, Net | | | NM | | | $ | 964 | | | $ | 802 | | | $ | 815 | |
| | | | |
| Traditional Homebuilding | | | | | | | | | | | | | | | | |
Homes Closed (Units) | | | | | | | | | | | | | | | | |
Florida | | | 362 | | | | 695 | | | | 1,312 | | | | 1,916 | |
Northeast U.S. | | | 33 | | | | 103 | | | | 152 | | | | 293 | |
Mid-Atlantic U.S. | | | 39 | | | | 61 | | | | 113 | | | | 137 | |
| | | | | | | | | | | | | | | | |
Total | | | 434 | | | | 859 | | | | 1,577 | | | | 2,346 | |
| | | | | | | | | | | | | | | | |
| | | | |
Revenues, excluding lot revenues | | | | | | | | | | | | | | | | |
Florida | | $ | 260,874 | | | $ | 304,053 | | | $ | 845,141 | | | $ | 852,565 | |
Northeast U.S. | | | 21,437 | | | | 60,163 | | | | 85,426 | | | | 171,588 | |
Mid-Atlantic U.S. | | | 48,544 | | | | 76,736 | | | | 137,826 | | | | 157,525 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 330,855 | | | $ | 440,952 | | | $ | 1,068,393 | | | $ | 1,181,678 | |
| | | | | | | | | | | | | | | | |
| | | | |
Average Selling Price Per Home Closed | | | | | | | | | | | | | | | | |
Florida | | $ | 721 | | | $ | 437 | | | $ | 644 | | | $ | 445 | |
Northeast U.S. | | | 650 | | | | 584 | | | | 562 | | | | 586 | |
Mid-Atlantic U.S. | | | 1,245 | | | | 1,258 | | | | 1,220 | | | | 1,150 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 762 | | | $ | 513 | | | $ | 677 | | | $ | 504 | |
| | | | | | | | | | | | | | | | |
| | | | |
Gross New Orders (Units) | | | | | | | | | | | | | | | | |
Florida | | | 207 | | | | 195 | | | | 902 | | | | 1,736 | |
Northeast U.S. | | | 35 | | | | 38 | | | | 288 | | | | 209 | |
Mid-Atlantic U.S. | | | 15 | | | | 21 | | | | 70 | | | | 106 | |
| | | | | | | | | | | | | | | | |
Total | | | 257 | | | | 254 | | | | 1,260 | | | | 2,051 | |
| | | | | | | | | | | | | | | | |
| | | | |
Cancellations (Units) | | | | | | | | | | | | | | | | |
Florida | | | (232 | ) | | | (33 | ) | | | (437 | ) | | | (201 | ) |
Northeast U.S. | | | (12 | ) | | | (8 | ) | | | (44 | ) | | | (49 | ) |
Mid-Atlantic U.S. | | | (5 | ) | | | (1 | ) | | | (29 | ) | | | (6 | ) |
| | | | | | | | | | | | | | | | |
Total | | | (249 | ) | | | (42 | ) | | | (510 | ) | | | (256 | ) |
| | | | | | | | | | | | | | | | |
Net New Orders (Units) | | | | | | | | | | | | | | | | |
Florida | | | (25 | ) | | | 162 | | | | 465 | | | | 1,535 | |
Northeast U.S. | | | 23 | | | | 30 | | | | 244 | | | | 160 | |
Mid-Atlantic U.S. | | | 10 | | | | 20 | | | | 41 | | | | 100 | |
| | | | | | | | | | | | | | | | |
Total | | | 8 | | | | 212 | | | | 750 | | | | 1,795 | |
| | | | | | | | | | | | | | | | |
| | | | |
Gross Contract Values of New Orders | | | | | | | | | | | | | | | | |
Florida | | $ | 127,665 | | | $ | 157,427 | | | $ | 658,744 | | | $ | 1,085,313 | |
Northeast U.S. | | | 21,553 | | | | 21,471 | | | | 153,158 | | | | 121,808 | |
Mid-Atlantic U.S. | | | 16,789 | | | | 27,560 | | | | 89,677 | | | | 135,836 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 166,007 | | | $ | 206,458 | | | $ | 901,579 | | | $ | 1,342,957 | |
| | | | | | | | | | | | | | | | |
| | | | |
Contract Values of Cancellations | | | | | | | | | | | | | | | | |
Florida | | $ | (166,329 | ) | | $ | (20,271 | ) | | $ | (288,871 | ) | | $ | (100,803 | ) |
Northeast U.S. | | | (7,088 | ) | | | (4,577 | ) | | | (22,854 | ) | | | (23,998 | ) |
Mid-Atlantic U.S. | | | (4,292 | ) | | | (994 | ) | | | (36,231 | ) | | | (6,625 | ) |
| | | | | | | | | | | | | | | | |
Total | | $ | (177,709 | ) | | $ | (25,842 | ) | | $ | (347,956 | ) | | $ | (131,426 | ) |
| | | | | | | | | | | | | | | | |
| | | | |
Net Contract Values of New Orders | | | | | | | | | | | | | | | | |
Florida | | $ | (38,664 | ) | | $ | 137,156 | | | $ | 369,873 | | | $ | 984,510 | |
Northeast U.S. | | | 14,465 | | | | 16,894 | | | | 130,304 | | | | 97,810 | |
Mid-Atlantic U.S. | | | 12,497 | | | | 26,566 | | | | 53,446 | | | | 129,211 | |
| | | | | | | | | | | | | | | | |
Total | | $ | (11,702 | ) | | $ | 180,616 | | | $ | 553,623 | | | $ | 1,211,531 | |
| | | | | | | | | | | | | | | | |
| | | | |
Gross Average Selling Price Per New Order | | | | | | | | | | | | | | | | |
Florida | | $ | 617 | | | $ | 807 | | | $ | 730 | | | $ | 625 | |
Northeast U.S. | | | 616 | | | | 565 | | | | 532 | | | | 583 | |
Mid-Atlantic U.S. | | | 1,119 | | | | 1,312 | | | | 1,281 | | | | 1,281 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 646 | | | $ | 813 | | | $ | 716 | | | $ | 655 | |
| | | | | | | | | | | | | | | | |
| | | | |
| Tower Homebuilding | | | | | | | | | | | | | | | | |
Homes Closed (Units) | | | | | | | | | | | | | | | | |
Florida | | | 234 | | | | 167 | | | | 638 | | | | 563 | |
| | | | | | | | | | | | | | | | |
Total | | | 234 | | | | 167 | | | | 638 | | | | 563 | |
| | | | | | | | | | | | | | | | |
| | | | |
Revenues | | | | | | | | | | | | | | | | |
Florida | | $ | 99,108 | | | $ | 291,077 | | | $ | 671,425 | | | $ | 987,512 | |
Northeast U.S. | | | 24,255 | | | | 48,235 | | | | 58,091 | | | | 48,235 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 123,363 | | | $ | 339,312 | | | $ | 729,516 | | | $ | 1,035,747 | |
| | | | | | | | | | | | | | | | |
| | | | |
Gross New Orders (Units) | | | | | | | | | | | | | | | | |
Florida | | | 5 | | | | 111 | | | | 104 | | | | 797 | |
Northeast U.S. | | | — | | | | 12 | | | | 7 | | | | 171 | |
| | | | | | | | | | | | | | | | |
Total | | | 5 | | | | 123 | | | | 111 | | | | 968 | |
| | | | | | | | | | | | | | | | |
| | | | |
Defaults (Units) | | | | | | | | | | | | | | | | |
Florida | | | (26 | ) | | | (1 | ) | | | (45 | ) | | | (2 | ) |
Northeast U.S. | | | (1 | ) | | | — | | | | (1 | ) | | | — | |
| | | | | | | | | | | | | | | | |
Total | | | (27 | ) | | | (1 | ) | | | (46 | ) | | | (2 | ) |
| | | | | | | | | | | | | | | | |
| | | | |
Net New Orders (Units) | | | | | | | | | | | | | | | | |
Florida | | | (21 | ) | | | 110 | | | | 59 | | | | 795 | |
Northeast U.S. | | | (1 | ) | | | 12 | | | | 6 | | | | 171 | |
| | | | | | | | | | | | | | | | |
Total | | | (22 | ) | | | 122 | | | | 65 | | | | 966 | |
| | | | | | | | | | | | | | | | |
| | | | |
Gross Contract Values of New Orders | | | | | | | | | | | | | | | | |
Florida | | $ | 5,374 | | | $ | 129,048 | | | $ | 134,520 | | | $ | 879,149 | |
Northeast U.S. | | | — | | | | 13,307 | | | | 12,153 | | | | 161,906 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 5,374 | | | $ | 142,355 | | | $ | 146,673 | | | $ | 1,041,055 | |
| | | | | | | | | | | | | | | | |
| | | | |
Contract Values of Defaults | | | | | | | | | | | | | | | | |
Florida | | $ | (31,479 | ) | | $ | (1,050 | ) | | $ | (44,888 | ) | | $ | (1,995 | ) |
Northeast U.S. | | | (1,625 | ) | | | — | | | | (1,625 | ) | | | — | |
| | | | | | | | | | | | | | | | |
Total | | $ | (33,104 | ) | | $ | (1,050 | ) | | $ | (46,513 | ) | | $ | (1,995 | ) |
| | | | | | | | | | | | | | | | |
Net Contract Values of New Orders | | | | | | | | | | | | | | | | |
Florida | | $ | (26,105 | ) | | $ | 127,998 | | | $ | 89,632 | | | $ | 877,154 | |
Northeast U.S. | | | (1,625 | ) | | | 13,307 | | | | 10,528 | | | | 161,906 | |
| | | | | | | | | | | | | | | | |
Total | | $ | (27,730 | ) | | $ | 141,305 | | | $ | 100,160 | | | $ | 1,039,060 | |
| | | | | | | | | | | | | | | | |
| | | | |
Gross Average Selling Price Per New Order | | | | | | | | | | | | | | | | |
Florida | | $ | 1,075 | | | $ | 1,163 | | | $ | 1,293 | | | $ | 1,103 | |
Northeast U.S. | | | NM | | | $ | 1,109 | | | $ | 1,736 | | | $ | 947 | |
| | | | | | | | | | | | | | | | |
Total | | $ | 1,075 | | | $ | 1,157 | | | $ | 1,321 | | | $ | 1,075 | |
| | | | | | | | | | | | | | | | |
Towers under construction recognizing revenue during the period | | | 17 | | | | 25 | | | | 24 | | | | 29 | |
| | | | | | | | |
| | | December 31, | |
| | | 2006 | | | 2005 | |
| Combined Traditional and Tower Homebuilding | | | | | | | | |
Aggregate Backlog Contract Values, | | | | | | | | |
Traditional and Tower Homebuilding | | $ | 911,156 | | | $ | 2,049,377 | |
| | |
| Traditional Homebuilding | | | | | | | | |
Backlog (Units) | | | 870 | | | | 1,697 | |
Backlog Contract Values | | $ | 682,577 | | | $ | 1,191,439 | |
| | |
| Tower Homebuilding | | | | | | | | |
Cumulative Units in Backlog | | | 1,297 | | | | 1,870 | |
Cumulative Contract Values | | $ | 1,521,420 | | | $ | 1,987,107 | |
Less: Cumulative Revenues Recognized | | | (1,292,841 | ) | | | (1,129,169 | ) |
| | | | | | | | |
Backlog Contract Values | | $ | 228,579 | | | $ | 857,938 | |
| | | | | | | | |
| * | The Company uses the percentage of completion method to recognize revenue on sold tower units. Accordingly, the closing of tower homes corresponds with the collection of contracts receivable. |
- 13 -
2006 Tower Profile (as of 2/23/07)
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | # of
Units | | Proj. Sell-out | | | %
Complete | | | Average
Deposit | | | HUD
Bldg@ | | Contract
Date | | Start
Date | | Expected
Closing Datet | | Tower
Completion
Datet |
| | | | Value | | % Sold | | | | | | | | |
Closed to Date | | | | | | | | | | | | | | | | | | | | | | | | |
Anchorage at Jupiter Yacht Club | | 34 | | $ | 32M | | 100 | % | | 100 | % | | 20 | % | | No | | 2Q 2004 | | 2Q 2004 | | Jan-06 | | 1Q 2006 |
Commodore at Jupiter Yacht Club | | 22 | | $ | 21M | | 100 | % | | 100 | % | | 20 | % | | No | | 2Q 2004 | | 2Q 2004 | | Jan-06 | | 1Q 2006 |
San Andres at Lost Key | | 45 | | $ | 28M | | 100 | % | | 100 | % | | 18 | % | | No | | 4Q 2004 | | 4Q 2004 | | Feb-06 | | 1Q 2006 |
Serano at Hammock Bay | | 116 | | $ | 68M | | 100 | % | | 100 | % | | 20 | % | | No | | 4Q 2004 | | 3Q 2004 | | Apr-06 | | 2Q 2006 |
Navona at The Colony | | 100 | | $ | 61M | | 100 | % | | 100 | % | | 20 | % | | Yes | | 2Q 2004 | | 2Q 2004 | | May-06 | | 2Q 2006 |
Santo Amaro at Lost Key | | 45 | | $ | 27M | | 96 | % | | 100 | % | | 18 | % | | No | | 4Q 2004 | | 4Q 2004 | | Jun-06 | | 2Q 2006 |
LaSalbadora at Lost Key | | 45 | | $ | 26M | | 73 | % | | 100 | % | | 17 | % | | No | | 4Q 2004 | | 4Q 2004 | | Aug-06 | | 3Q 2006 |
One Singer Island | | 15 | | $ | 47M | | 80 | % | | 100 | % | | 20 | % | | No | | 2Q 2004 | | 3Q 2004 | | Nov-06 | | 4Q 2006 |
Casa at Castella (The Colony) | | 24 | | $ | 25M | | 38 | % | | 100 | % | | 16 | % | | Yes | | 3Q 2004 | | 1Q 2005 | | Nov-06 | | 4Q 2006 |
Mansion at Castella (The Colony) | | 24 | | $ | 26M | | 58 | % | | 100 | % | | 15 | % | | Yes | | 1Q 2005 | | 1Q 2005 | | Nov-06 | | 4Q 2006 |
Villa at Castella (The Colony) | | 24 | | $ | 26M | | 42 | % | | 100 | % | | 17 | % | | Yes | | 2Q 2005 | | 1Q 2005 | | Nov-06 | | 4Q 2006 |
Costa Verano at Jacksonville Beach | | 100 | | $ | 95M | | 95 | % | | 97 | % | | 20 | % | | No | | 3Q 2004 | | 3Q 2004 | | Dec-06 | | 4Q 2006 |
Tuscany at Hammock Dunes | | 64 | | $ | 82M | | 86 | % | | 100 | % | | 20 | % | | No | | 4Q 2004 | | 2Q 2005 | | Dec-06 | | 4Q 2006 |
Mosaic at Miami Beach | | 91 | | $ | 124M | | 99 | % | | 100 | % | | 20 | % | | No | | 3Q 2004 | | 4Q 2004 | | Dec-06 | | 4Q 2006 |
| | | | | | | | | | | | | | | | | | | | | | | | |
Totals | | 749 | | $ | 688M | | 91 | % | | 100 | % | | 19 | % | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
Under Construction | | | | | | | | | | | | | | | | | | | | | | | | |
Resort at Singer Island Condo | | 66 | | $ | 106M | | 97 | % | | 96 | % | | 20 | % | | Yes | | 3Q 2004 | | 3Q 2004 | | Mar-07 | | 4Q 2006 |
Resort at Singer Island Condo/Hotel* | | 229 | | $ | 152M | | 100 | % | | 95 | % | | 20 | % | | Yes | | 3Q 2004 | | 3Q 2004 | | Mar-07 | | 4Q 2006 |
Lesina at Hammock Bay | | 116 | | $ | 130M | | 64 | % | | 94 | % | | 19 | % | | Yes | | 2Q 2005 | | 3Q 2005 | | Mar - Apr 07 | | 1Q 2007 |
The Galia at Lost Key Marina | | 70 | | $ | 50M | | 56 | % | | 94 | % | | 19 | % | | No | | 4Q 2005 | | 4Q 2005 | | Mar - Apr 07 | | 1Q 2007 |
Le Jardin at Hammock Dunes | | 26 | | $ | 67M | | 69 | % | | 82 | % | | 18 | % | | No | | 4Q 2005 | | 4Q 2005 | | May - Jun 07 | | 2Q 2007 |
San Anton at Lost Key | | 54 | | $ | 38M | | 78 | % | | 92 | % | | 19 | % | | No | | 2Q 2005 | | 3Q 2005 | | May - Jun 07 | | 2Q 2007 |
One Bal Harbour Condo | | 185 | | $ | 377M | | 100 | % | | 94 | % | | 19 | % | | Yes | | 4Q 2003 | | 2Q 2004 | | Jun - Jul 07 | | 1Q 2007 |
One Bal Harbour Condo/Hotel* | | 115 | | $ | 111M | | 100 | % | | 96 | % | | 20 | % | | Yes | | 4Q 2004 | | 2Q 2004 | | Jun - Jul 07 | | 1Q 2007 |
Castillo at Westshore | | 80 | | $ | 81M | | 90 | % | | 86 | % | | 18 | % | | Yes | | 3Q 2005 | | 4Q 2005 | | Jun - Jul 07 | | 2Q 2007 |
The Watermark^ | | 206 | | $ | 233M | | 86 | % | | 62 | % | | 10 | % | | Yes | | 2Q 2005 | | 3Q 2005 | | Sept - Oct 07 | | 3Q 2007 |
Florencia at The Colony | | 116 | | $ | 123M | | 78 | % | | 79 | % | | 19 | % | | Yes | | 3Q 2005 | | 3Q 2005 | | Oct - Nov 07 | | 4Q 2007 |
Oceanside B | | 186 | | $ | 237M | | 63 | % | | 59 | % | | 18 | % | | Yes | | 3Q 2005 | | 4Q 2005 | | Feb - Mar 08 | | 1Q 2008 |
| | | | | | | | | | | | | | | | | | | | | | | | |
Totals | | 1,449 | | $ | 1,705M | | 84 | % | | 86 | % | | 18 | % | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| * | Does not count as a separate tower |
| @ | In the event of a default in a HUD building, the company may retain no more than 15% of the total purchase price of the unit. Any additional deposit must be returned to the buyer. |
| ^ | An additional 10% is due when the tower is topped off. |
t | Expected closing date based on current construction schedule. |
- 14 -
Summary of Land Controlled
December 31, 2006
| | | | | | | | | | | | | | | | |
Region | | Remaining
Planned
Units | | Units in
Backlog as
of 12/31/06 | | Value in
Backlog as of 12/31/06 | | Spec
Units
in WIP | | Finished
Spec and
Model
Units | | Total
Units
Remaining | | %
Owned | |
Traditional Homebuilding (Including Lots) | | | | | | | | | | | | | | | | |
Florida | | | | | | | | | | | | | | | | |
Miami / Ft. Lauderdale | | 2,065 | | 302 | | $ | 280.6 | | 48 | | 79 | | 1,636 | | 100 | % |
Naples / Ft. Myers | | 4,213 | | 109 | | | 72.8 | | 118 | | 105 | | 3,881 | | 100 | % |
Palm Beach / Indian River | | 560 | | 16 | | | 13.8 | | 10 | | 23 | | 511 | | 100 | % |
Palm Coast / Jacksonville | | 25 | | 1 | | | 1.1 | | 13 | | 11 | | — | | 100 | % |
Perdido Key | | 114 | | — | | | — | | 11 | | 1 | | 102 | | 100 | % |
Tampa / Sarasota | | 4,653 | | 180 | | | 147.6 | | 54 | | 128 | | 4,291 | | 83 | % |
Mid-Atlantic | | 306 | | 30 | | | 47.4 | | 16 | | 31 | | 229 | | 100 | % |
Northeast | | 2,114 | | 232 | | | 119.3 | | 20 | | 24 | | 1,838 | | 76 | % |
| | | | | | | | | | | | | | | | |
Traditional Homebuilding Total | | 14,050 | | 870 | | | 682.6 | | 290 | | 402 | | 12,488 | | 91 | % |
| | | | | | | |
Tower Homebuilding | | | | | | | | | | | | | | | | |
Florida | | | | | | | | | | | | | | | | |
Miami / Ft. Lauderdale | | 1,272 | | 454 | | | 90.1 | | 68 | | 2 | | 748 | | 87 | % |
Naples / Ft. Myers | | 1,021 | | 164 | | | 21.9 | | 68 | | 41 | | 748 | | 100 | % |
Palm Beach / Indian River | | 587 | | 293 | | | 11.4 | | 2 | | 3 | | 289 | | 61 | % |
Palm Coast / Jacksonville | | 591 | | 56 | | | 26.9 | | 13 | | 9 | | 513 | | 100 | % |
Perdido Key | | 1,554 | | 81 | | | 2.0 | | 43 | | 14 | | 1,416 | | 100 | % |
Tampa / Sarasota | | 652 | | 72 | | | 10.1 | | 8 | | — | | 572 | | 75 | % |
Mid-Atlantic | | 278 | | — | | | — | | — | | — | | 278 | | 100 | % |
Northeast | | 480 | | 177 | | | 66.1 | | 29 | | — | | 274 | | 43 | % |
| | | | | | | | | | | | | | | | |
Tower Homebuilding Total | | 6,435 | | 1,297 | | | 228.5 | | 231 | | 69 | | 4,838 | | 87 | % |
| | | | | | | |
Total Homebuilding | | | | | | | | | | | | | | | | |
Florida | | | | | | | | | | | | | | | | |
Miami / Ft. Lauderdale | | 3,337 | | 756 | | | 370.7 | | 116 | | 81 | | 2,384 | | 95 | % |
Naples / Ft. Myers | | 5,234 | | 273 | | | 94.7 | | 186 | | 146 | | 4,629 | | 100 | % |
Palm Beach / Indian River | | 1,147 | | 309 | | | 25.2 | | 12 | | 26 | | 800 | | 80 | % |
Palm Coast / Jacksonville | | 616 | | 57 | | | 28.1 | | 21 | | 20 | | 518 | | 100 | % |
Perdido Key | | 1,668 | | 81 | | | 2.0 | | 54 | | 15 | | 1,518 | | 100 | % |
Tampa / Sarasota | | 5,305 | | 252 | | | 157.7 | | 62 | | 128 | | 4,863 | | 82 | % |
Mid-Atlantic | | 584 | | 30 | | | 47.4 | | 16 | | 31 | | 507 | | 100 | % |
Northeast | | 2,594 | | 409 | | | 185.4 | | 49 | | 24 | | 2,112 | | 70 | % |
| | | | | | | | | | | | | | | | |
Total Homebuilding Total | | 20,485 | | 2,167 | | | 911.1 | | 521 | | 471 | | 17,326 | | 90 | % |
| | | | | | | | | | | | | | | | |
| | | | | | |
|
| Remaining Planned Units |
| December 31, 2006 |
| | | Owned | | Optioned | | Total
Controlled |
Traditional Homebuilding | | 12,754 | | 1,296 | | 14,050 |
Tower Homebuilding | | 5,606 | | 829 | | 6,435 |
| | | | | | |
Total Homebuilding | | 18,360 | | 2,125 | | 20,485 |
| | | | | | |
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