Exhibit 99.1
M/I Homes Reports
First Quarter Results
Columbus, Ohio (April 30, 2009) - M/I Homes, Inc. (NYSE:MHO) announced results for the first quarter ended March 31, 2009, highlighted by (i) a 20% increase in new contracts compared to the first quarter of 2008, representing the Company’s highest quarterly sales in six quarters, (ii) a year-over-year increase in backlog units, and (iii) an $11.9 million loss from operations on 394 deliveries comparing favorably to the fourth quarter 2008 loss from operations of $18.2 million on 554 deliveries. For the quarter, the Company reported a net loss of $28.1 million consisting of the aforesaid operating loss, $11.0 million for asset impairments, and a $4 million charge for issues related to imported drywall. During the first quarter of 2008, the Company had a net loss of $22.2 million, which included a $6.6 million income tax benefit.
New contracts and homes delivered for the first quarter of 2009 were 667 and 394, respectively, compared to new contracts of 554 and homes delivered of 474 for the first quarter of 2008. The Company’s cancellation rate was 20%, compared to 23% in 2008’s first quarter. Backlog of homes at March 31, 2009 had a sales value of $193 million, with an average sales price of $230,000 and backlog units of 839 – slightly higher than a year-ago’s backlog units of 828. Backlog of homes at March 31, 2008 had a sales value of $246 million, with an average sales price of $298,000. M/I Homes had 119 active communities at March 31, 2009 compared to 148 at March 31, 2008.
Robert H. Schottenstein, Chief Executive Officer and President, commented, “We are, for the most part, pleased with our first quarter results as there are a number of positives worth noting. We sold 667 homes during the quarter, a 20% increase over last year, and we achieved this growth in sales despite our community count being down by 20%. Our gross margin for the quarter, while below last year, improved 400 basis points from fourth quarter of 2008’s gross margin. In addition, for the first time since March 2006, our backlog units are up from the prior year.”
Mr. Schottenstein continued, “We have made considerable progress in reducing our expense levels and improving our cost structure. During the past year, we reduced our selling, general and administrative expenses by 33% – these reductions, along with our improved gross margin, are major reasons why we were able to narrow our operating loss by 35% from the fourth quarter of 2008 on 160 fewer homes delivered. We continue to focus on cash generation, ending the quarter with $65 million of cash on hand, zero bank borrowings and no debt maturing until 2012. We also entered into a new mortgage warehouse line for M/I Financial. Our net debt to capital ratio stands at 30% at quarter end, one of the lowest levels in our industry.”
Mr. Schottenstein, concluded, “Looking ahead, we are focused on building on the momentum we have generated during the first quarter and are continuing to adapt our business to the ever-changing environment in which we operate. Our recent announcements regarding the introduction of our new affordably priced ‘eco series ’ homes and our commitment to building 100% Energy Star qualified homes in every one of our markets serve as prime examples of our ability to respond to the needs and wants of today’s (and tomorrow’s) homebuyers. Though we are starting to see some signs of improved market conditions, the general economy remains weak and we will therefore, continue to employ the conservative predominantly defensive operating strategy that has served us well during this prolonged downturn.”
The Company will broadcast live its earnings conference call today at 4:00 p.m. Eastern Time. To hear the call, log on to the M/I Homes’ website at mihomes.com, click on the “Investors” section of the site, and select “Listen to the Conference Call.” The call, along with any applicable reconciliation of non-GAAP financial measures, will continue to be available on our website through April 2010.
M/I Homes, Inc. is one of the nation’s leading builders of single-family homes, having delivered nearly 74,000 homes. The Company’s homes are marketed and sold under the trade names M/I Homes and Showcase Homes. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Chicago, Illinois; Indianapolis, Indiana; Tampa and Orlando, Florida; Charlotte and Raleigh, North Carolina; and the Virginia and Maryland suburbs of Washington, D.C.
Certain statements in this Press Release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “anticipates,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. These statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various factors relating to the economic environment, interest rates, availability of resources, competition, market concentration, land development activities and various governmental rules and regulations, as more fully discussed in the Risk Factors section in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008. All forward-looking statements made in this Press Release are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed in this Press Release will increase with the passage of time. The Company undertakes no duty to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or presentations should be consulted.
Contact M/I Homes, Inc.
Phillip G. Creek, Executive Vice President, Chief Financial Officer, (614) 418-8011
Ann Marie W. Hunker, Corporate Controller, (614) 418-8225
M/I Homes, Inc. and Subsidiaries
Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
| Three Months Ended | ||||||
| March 31, | ||||||
| 2009 | 2008 | |||||
| Revenue: | $ | 96,149 | $ | 156,085 | ||
| Net loss: | ||||||
| Loss from continuing operations | $ | (28,129 | ) | $ | (20,150 | ) |
| Income from discontinued operation | - | 380 | ||||
| Net loss | $ | (28,129 | ) | (19,770 | ) | |
| Preferred share dividends | - | 2,437 | ||||
| Net loss to common shareholders | $ | (28,129 | ) | $ | (22,207 | ) |
| Loss per share: | ||||||
| Basic and Diluted: | ||||||
| Continuing operations | $ | (2.01 | ) | $ | (1.61 | ) |
| Discontinued operation | - | 0.03 | ||||
| Total | $ | (2.01 | ) | $ | (1.58 | ) |
| Weighted average shares outstanding: | ||||||
| Basic | 14,027 | 14,007 | ||||
| Diluted | 14,027 | 14,007 | ||||
M/I Homes, Inc. and Subsidiaries
Selected Supplemental Financial and Operating Data
(Dollars in thousands, except per share amounts)
(Unaudited)
| Three Months Ended | ||||||
| March 31, | ||||||
| 2009 | 2008 | |||||
| Revenue | $ | 96,149 | $ | 156,085 | ||
| Gross margin | (2,712 | ) | 3,410 | |||
| General and administrative expense | 12,002 | 17,558 | ||||
| Selling expense | 9,109 | 13,726 | ||||
| Operating loss | (23,823 | ) | (27,874 | ) | ||
| Other expense (income) | 941 | (5,555 | ) | |||
| Interest expense - net | 3,196 | 4,439 | ||||
| Loss from continuing operations before income taxes | (27,960 | ) | (26,758 | ) | ||
| Provision (benefit) for income taxes | 169 | (6,608 | ) | |||
| Loss from continuing operations, net of income taxes | (28,129 | ) | (20,150 | ) | ||
| Income from discontinued operation, net of income taxes | - | 380 | ||||
| Net loss | (28,129 | ) | (19,770 | ) | ||
| Preferred share dividends | - | 2,437 | ||||
| Net loss to common shareholders | $ | (28,129 | ) | $ | (22,207 | ) |
| Revenue: | ||||||
| Housing revenue | $ | 92,503 | $ | 130,936 | ||
| Land revenue | 657 | 12,774 | ||||
| Other | - | 6,965 | ||||
| Total homebuilding revenue | 93,160 | 150,675 | ||||
| Financial services revenue | 2,989 | 5,410 | ||||
| Total revenue | $ | 96,149 | $ | 156,085 | ||
| Land, Lot and Investment in Unconsolidated Subsidiaries | ||||||
| Impairment by Region: | ||||||
| Midwest | $ | 1,411 | $ | 2,519 | ||
| Florida | 6,666 | 18,494 | ||||
| Mid-Atlantic | 2,869 | 94 | ||||
| Total | $ | 10,946 | $ | 21,107 | ||
Abandonments by Region: | ||||||
| Midwest | $ | 3 | $ | 24 | ||
| Florida | 14 | 131 | ||||
| Mid-Atlantic | 15 | 1,049 | ||||
| Total | $ | 32 | $ | 1,204 | ||
M/I Homes, Inc. and Subsidiaries
Selected Supplemental Financial and Operating Data
(Dollars in thousands, except per share amounts)
(Unaudited)
| Three Months Ended | ||||||
| March 31, | ||||||
| 2009 | 2008 | |||||
EBITDA (2) | $ | (9,115 | ) | $ | 6,530 | |
| Interest incurred - net of fee amortization | $ | 3,773 | $ | 5,511 | ||
| Interest amortized to cost of sales | $ | 1,672 | $ | 2,573 | ||
| Depreciation and amortization | $ | 2,502 | $ | 2,780 | ||
| Non-cash charges | $ | 11,731 | $ | 23,137 | ||
| Cash provided by operating activities | $ | 53,639 | $ | 98,752 | ||
| Cash provided by investing activities | $ | (29,982 | ) | $ | 7,734 | |
| Cash (used in) financing activities | $ | (27,548 | ) | $ | (106,377 | ) |
| Financial services pre-tax income | $ | 1,301 | $ | 3,337 | ||
(2) Earnings before interest, taxes, depreciation and amortization (“EBITDA”) is defined, in accordance with our credit facility, as net income, plus interest expense (including interest amortized to land and housing costs), income taxes, depreciation, amortization and non-cash charges, minus interest income. | ||||||
| NEW CONTRACTS | HOMES DELIVERED | ||||||||||
| Three Months Ended | Three Months Ended | ||||||||||
| March 31, | March 31, | ||||||||||
| % | % | ||||||||||
| Region | 2009 | 2008 | Change | 2009 | 2008 | Change | |||||
| Midwest | 347 | 240 | 45 | 176 | 189 | (7) | |||||
| Florida | 111 | 149 | (26) | 102 | 140 | (27) | |||||
| Mid-Atlantic | 209 | 165 | 27 | 116 | 121 | (4) | |||||
| Continuing Operations | 667 | 554 | 20 | 394 | 450 | (12) | |||||
| Discontinued Operation | - | - | - | - | 24 | (100) | |||||
| Total | 667 | 554 | 20 | 394 | 474 | (17) | |||||
| BACKLOG | |||||||||||
| March 31, 2009 | March 31, 2008 | ||||||||||
| Dollars | Average | Dollars | Average | ||||||||
| Region | Units | (millions) | Sales Price | Units | (millions) | Sales Price | |||||
| Midwest | 536 | 110 | 206,000 | 442 | 118 | 267,000 | |||||
| Florida | 86 | 21 | 240,000 | 130 | 38 | 294,000 | |||||
| Mid-Atlantic | 217 | 62 | 285,000 | 244 | 87 | 355,000 | |||||
| Continuing Operations | 839 | 193 | 230,000 | 816 | 243 | 297,000 | |||||
| Discontinued Operation | - | - | - | 12 | 3 | 311,000 | |||||
| Total | 839 | 193 | 230,000 | 828 | 246 | 298,000 | |||||
M/I Homes, Inc. and Subsidiaries
Summary Balance Sheet Information
(Dollars in thousands, except per share amounts)
(Unaudited)
| March 31, | ||||||
| 2009 | 2008 | |||||
| Assets: | ||||||
Total Cash | $ | 65,349 | $ | 13,222 | ||
| Mortgage loans held for sale | 27,472 | 29,923 | ||||
| Inventory: | ||||||
| Lots, land and land development | 322,146 | 464,541 | ||||
| Land held for sale | 2,804 | 3,559 | ||||
| Homes under construction | 145,652 | 248,103 | ||||
| Other inventory | 27,174 | 31,647 | ||||
| Total Inventory | 497,776 | 747,850 | ||||
| Property and equipment - net | 20,748 | 30,806 | ||||
| Investment in unconsolidated joint ventures | 8,338 | 34,087 | ||||
| Income tax receivable | 3,067 | 20,241 | ||||
| Deferred income taxes | - | 57,456 | ||||
| Other assets | 18,726 | 28,308 | ||||
| Total Assets | $ | 641,476 | $ | 961,893 | ||
| Liabilities: | ||||||
| Debt – Homebuilding Operations: | ||||||
| Notes payable banks | $ | - | $ | 42,000 | ||
| Notes payable other | 6,374 | 6,640 | ||||
| Senior notes | 199,232 | 198,976 | ||||
| Total Debt – Homebuilding Operations | 205,606 | 247,616 | ||||
| Note payable bank – financial services operations | 20,430 | 11,200 | ||||
| Total Debt | 226,036 | 258,816 | ||||
| Accounts payable | 34,898 | 53,175 | ||||
| Other liabilities | 74,897 | 90,320 | ||||
| Total Liabilities | 335,831 | 402,311 | ||||
| Shareholders’ Equity | 305,645 | 559,582 | ||||
| Total Liabilities and Shareholders’ Equity | $ | 641,476 | $ | 961,893 | ||
| Book value per common share | $ | 14.65 | $ | 32.79 | ||
| Homebuilding net debt/capital ratio | 30 | % | 29 | % | ||
M/I Homes, Inc. and Subsidiaries
Selected Supplemental Financial and Operating Data
(Unaudited)
| LAND POSITION SUMMARY | ||||||||||||
| March 31, 2009 | March 31, 2008 | |||||||||||
| Lots | Lots Under | Lots | Lots Under | |||||||||
| Region | Owned | Contract | Total | Owned | Contract | Total | ||||||
| Midwest | 5,161 | 582 | 5,743 | 6,195 | 527 | 6,722 | ||||||
| Florida | 1,801 | 42 | 1,843 | 4,183 | 261 | 4,444 | ||||||
| Mid-Atlantic | 1,469 | 330 | 1,799 | 1,950 | 881 | 2,831 | ||||||
| Total | 8,431 | 954 | 9,385 | 12,328 | 1,669 | 13,997 | ||||||