Exhibit 99.1
Standard Pacific Corp. Reports a 153% Increase in Third Quarter EPS to a
Record $1.72 and Raises Guidance for Full Year to $5.65 to $5.75 Per Share
IRVINE, Calif., Oct. 27 /PRNewswire-FirstCall/ -- Standard Pacific Corp.
(NYSE: SPF) today reported the Company's 2003 third quarter results:
Financial and Operating Highlights - 2003 Third Quarter vs. 2002 Third Quarter
- EPS rose 153% to a record $1.72
- Net income of $57.9 million, up 156% over 2002
- Record third quarter homebuilding revenues of $624 million, up 35%
year-over-year
- Record third quarter deliveries of 2,244 new homes, up 43% from last
year
- Gross margin percentage improves 530 bp's year-over-year to 21.7%
- Adjusted Homebuilding EBITDA of $105 million, an increase of 104% over
2002*
- LTM return on average equity improves 640 bp's year-over-year to 21.6%
- New orders rise 24% to a third quarter record 2,148 homes
- Record third quarter backlog of 4,684 presold homes valued at
$1.6 billion, up 25%
- Raising 2003 full year guidance to $5.65 to $5.75 per share, an
increase of up to 57% from last year
- Initial guidance established for 2004 of $6.40 to $6.50 per share
* For a definition of Adjusted Homebuilding EBITDA and a reconciliation
of net income to Adjusted Homebuilding EBITDA and cash flows from
operating activities to Adjusted Homebuilding EBITDA, please see the
Selected Financial Data included herewith.
Net income for the three months ended September 30, 2003 increased 156% to
$57.9 million, or $1.72 per diluted share, compared to $22.6 million, or $0.68
per diluted share last year.
Stephen J. Scarborough, Chairman and Chief Executive Officer, commented,
"Our record results for the quarter reflect continued strength in demand for
new housing and our significant and growing position in some of the largest
and strongest housing markets in the country. Our existing operations in
California and Arizona saw meaningful year-over-year increases in new home
deliveries, revenues and operating profits while our new Southeastern region
is on target to generate 33% of our companywide deliveries in 2003. The
significance of our Southeastern presence was further enhanced last week with
the announced acquisition of Coppenbarger Homes in Jacksonville, Florida.
This acquisition will complement our recent expansion in the Southeast where
we are projected to generate nearly 3,800 deliveries in 2004 with revenues of
$700 million.
"The success of our business model is further validated by our rapidly
improving return on average shareholders' equity which was 21.6% for the last
twelve months," Mr. Scarborough said. "This positive trend reflects the
growing contributions from our investments last year in the Southeast and our
extremely profitable franchise and growing share of the important California
market. We have made considerable progress in improving our homebuilding
gross margin percentage and we remain committed to further improving our
operating performance, including our asset utilization, and expect our return
on equity for the full year to increase from where we are today. Evidence of
our success in managing our asset base is reflected in the reduction in
completed and unsold units which declined 65% from a year ago to 80 homes
companywide, or 0.6 per community on average.
"While we are extremely pleased with the record operating results for the
third quarter, we are even more excited about the outlook for the rest of this
year and 2004," Mr. Scarborough noted. "Our enthusiasm is supported by our
record new home orders for the quarter which, at 2,148 homes, were up 24%
year-over-year. Orders were up in all seven states in which we operate, and
were strongest in our largest and most profitable markets in California,
Arizona and Florida. The strength of our orders contributed to our record
quarter end backlog of nearly $1.6 billion, up 25% over last year. Traffic
levels remain strong in most of our markets and our cancellation rate at 20%
is slightly below the prior year level.
"Our future growth prospects are supported by an extremely strong land
pipeline," Mr. Scarborough said. "At quarter end we controlled nearly
37,500 lots, up 35% from a year ago and consistent with our strategy of
maintaining a 3 to 4 year supply. We have been able to continue to secure
well-located land parcels in the increasingly constrained California markets
and have been extremely pleased with our ability to grow our lot position and
community count throughout our new Southeastern region. Our success in
Florida and the Carolinas reflects the reputation and talent of the management
teams in our acquired operating divisions."
Mr. Scarborough continued, "We are raising our full year guidance for 2003
to $5.65 to $5.75 per share which represents a potential 57% increase over our
2002 earnings and would generate a five-year compound annual growth rate of
30%. We are targeting homebuilding revenues of $2.3 billion for the year
driven by the projected delivery of 7,500 new homes, excluding 600 joint
venture deliveries. For the 2003 fourth quarter, our earnings are expected to
be between $1.95 and $2.05 per share, representing up to a 30% year-over-year
increase, based on the delivery of 2,375 new homes, excluding 200 joint
venture deliveries, with homebuilding revenues of $750 million.
"We are also introducing our initial guidance for 2004 which is estimated
to be between $6.40 and $6.50 per share. We are targeting 9,400 deliveries,
excluding 400 joint venture new homes, and revenues of $3.0 billion. To
support our 25% increase in projected deliveries next year, we are planning on
opening over 30 new communities in the fourth quarter and over 100 in 2004, up
approximately 20% year-over-year. As a result of the seasonal nature of our
business and the timing of new community openings, we expect that
approximately 60% of our profits next year will be generated in the second
half of the year."
Mr. Scarborough concluded, "As we continue to execute our growth strategy
our financial position remains strong. Our homebuilding leverage remains well
within our target range and we have continued to maintain a well diversified
capital structure and significant liquidity. During the quarter, we took
advantage of favorable capital market conditions and interest rates and issued
$150 million of new five year 6.5% senior notes which we plan to use, in part,
to retire higher cost debt."
Homebuilding
Homebuilding pretax income for the 2003 third quarter was up 166% to
$93.6 million compared to $35.2 million last year. The higher level of pretax
income was driven by a 35% increase in homebuilding revenues, a 530 basis
point improvement in our homebuilding gross margin percentage, a 40 basis
point decrease in the Company's SG&A rate and an $11.9 million increase in
joint venture income.
Homebuilding revenues for the 2003 third quarter were $623.9 million
compared to $462.3 million in the year earlier period. The 35% increase in
revenues was driven by a 38% increase in new home deliveries (exclusive of
joint ventures), which was partially offset by a 3% decrease in the Company's
average home price. Excluding the 725 homes delivered from our new Florida
and Carolina operations, consolidated deliveries were up 22%.
During the quarter the Company delivered 728 new homes in California
(exclusive of joint ventures), a 35% increase over the 2002 third quarter.
Including joint ventures, deliveries were up 49% in California to 892 homes,
which reflects strong housing market conditions in most areas of the state.
Deliveries were up 66% in Southern California to 727 new homes (including
110 joint venture deliveries) and up 2% in Northern California to 165 new
homes (including 54 joint venture deliveries). In Arizona, deliveries were up
17% to 452 new homes. This increase was due to a resurgence of orders in the
Phoenix housing market earlier in the year. Deliveries were essentially flat
in Texas at 116 homes and were down 20% in Colorado to 59 new homes. Both of
these regions continue to experience weak economic conditions and sluggish
demand for new housing. The Company delivered 584 new homes in Florida
compared to 289 homes last year and 141 new homes in the Carolinas versus
99 in the 2002 third quarter. Of the Company's three acquisitions in the
Southeastern United States last year, two closed in the second quarter of 2002
while the third closed midway through the third quarter. The delivery levels
in this region reflect generally healthy housing market conditions for the
price points served by our operations.
During the third quarter the Company's average home price declined 3% to
$298,000. The lower selling price reflects the Company's efforts to broaden
its price points in its existing markets as well as our expansion into the
Southeastern United States where our average price is expected to be
approximately $175,000 for 2003. The average home price in California
(exclusive of joint ventures) was flat compared to the year earlier period at
$500,000. While we have continued to experience general price increases in
the state due to strong demand for new housing, we have continued to pursue
opportunities in lower price points and in more affordable markets. Our
average home price in Arizona was up 3% to $178,000 reflecting a change in the
mix of new homes delivered. The Company's average home price in Texas was
down 9% and primarily reflects a shift in mix to lower priced homes. The
Company's average home prices in Florida and the Carolinas were $182,000 and
$138,000, respectively, and reflect a product orientation towards the entry
level and first-time move-up buyer.
The Company's homebuilding gross margin percentage was up 530 basis points
year-over-year and up 100 basis points from the prior quarter to 21.7%. The
increase in the year-over-year gross margin percentage was driven primarily by
higher margins in California and Arizona and above average margins in Florida.
Last year's homebuilding gross margin was adversely impacted by the effect of
the purchase accounting adjustments recorded in connection with our three
acquisitions during 2002, as well as the 2002 third quarter charges related to
our decision to exit the Houston market and to an impairment charge related to
certain of our Colorado projects. Homebuilding margins in Texas and Colorado
are still well below our companywide average reflecting the impact of slower
economic conditions in those regions. For the full year, the Company expects
its homebuilding gross margin percentage to be approximately 21% compared to
18.1% last year. The higher gross margin percentage reflects our ability to
raise home prices in most of our California and Florida markets as a result of
strong demand and improving margins in Arizona due to volume and cost
efficiencies.
Selling, general and administrative expenses (including corporate G&A) for
the 2003 third quarter were 9.3% of homebuilding revenues compared to 9.7%
last year. The decrease in SG&A expenses as a percentage of homebuilding
revenues was due primarily to the economies of scale realized from our
significant increase in revenues. This improvement in our SG&A rate reverses
a trend over the past year where our SG&A rate was higher year-over-year as a
result of our expansion into the Southeast where we generally incur higher
levels of sales and marketing costs and G&A expenses. We expect that our SG&A
rate for the fourth quarter will be lower than the third quarter as a result
of the benefit of higher revenue levels.
Income from unconsolidated joint ventures was up $11.9 million to
$17.8 million and was driven by an increase in joint venture deliveries from
62 homes last year to 164 homes this year and from an increase in joint
venture income from land sales to other builders. For the full year we expect
to generate approximately $57 million in joint venture income from
600 deliveries as well as land sales to other builders.
New orders for the quarter, including joint ventures, were up 24% to a
record 2,148 new homes on a 5% increase in average community count. The
Company's cancellation rate declined for the quarter to 20% versus 21% last
year. Orders were off 23% in Southern California on a 32% decline in average
new home communities, up 128% in Northern California on a 57% higher community
count, up 72% in Arizona on a 6% higher community count, up 5% in Texas on a
28% lower community count and up 40% in Colorado on a flat community count.
For the 2003 third quarter the Company generated 464 net new orders in Florida
from 30 active selling communities and 120 orders in the Carolinas from 8
communities. The orders generated in California, Arizona, Florida and the
Carolinas generally reflect healthy housing market conditions in those regions
while the order levels in Texas and Colorado still reflect the impact of
generally weak economic conditions on the demand for new housing.
The record level of new home orders for the third quarter resulted in a
record third quarter backlog of 4,684 presold homes (including 327 joint
venture homes) valued at an estimated $1.6 billion (including $167 million of
joint venture backlog), an increase of 25% from the September 30, 2002 backlog
value.
The Company ended the third quarter with 128 active selling communities, a
slight decrease over the year earlier period. The lower community count total
compared to the prior year is primarily the result of strong order trends in
many of our markets and faster than anticipated sellouts in our communities.
The Company is planning to open approximately 30 - 35 new communities over the
balance of the year compared to 15 in last year's fourth quarter which would
result in a total of approximately 85 new community openings for all of 2003,
a 35% to 40% increase over the total number of communities opened in 2002. By
the end of 2003 the Company expects to have approximately 155 - 160 active
subdivisions, which would be approximately a 15% increase over the 2002 year-
end community count level. For 2004, the Company is planning on opening
100 to 110 new communities and targeting 185 to 200 active communities at the
end of 2004, a 20% to 25% increase over this year.
Financial Services
Third quarter revenues for the Company's financial services segment, which
represents our mortgage banking operations throughout California and in South
Florida, were up 41% to $4.1 million compared to $2.9 million last year. The
higher level of revenues was driven by a 99% increase in the volume of
mortgage loans sold, which was offset, in part, by a decrease in the margins
generated on loans sold. The higher level of loan volume was driven by an
increase in our California new home deliveries and the commencement of loan
originations in South Florida at the end of last year. The lower margins on
loans sold resulted from the volatile interest rate environment experienced
during the 2003 third quarter.
Expenses for the financial services segment were up 67% during the quarter
and were the result of higher revenue and earnings levels and from expenses
incurred in connection with our expansion into the South Florida market.
Financial services joint venture income, which is derived from mortgage
banking joint ventures with third party financial institutions which operate
in conjunction with our homebuilding divisions in Arizona, Texas, Colorado,
the Carolinas, and Tampa and Southwestern Florida, was up 32% to $864,000.
The higher level of income was primarily due to the addition of the Florida
and Carolina joint venture last year through the acquisition of Westfield
Homes and increased deliveries in Arizona.
Redemption of 81/2% Senior Notes due 2007
On October 27, 2003, the Company will redeem in full its $100 million
81/2% Senior Notes due 2007 at a price of 102.833% of par. The Company will
incur a fourth quarter after-tax charge of approximately $2.0 million, or
$0.06 per share, for the early extinguishment of these notes.
A conference call to discuss the Company's third quarter earnings will be
held at 11:00 a.m. Eastern time today. The call will be broadcast live over
the Internet and can be accessed through the Company's website at
www.standardpacifichomes.com/investor/investors.asp . The call will also be
accessible via telephone by dialing (800) 915-4836. The entire audio
transmission with the synchronized slide presentation will also be available
on our website for replay within 2 to 3 hours following the live broadcast. A
replay of the conference call will also be available by dialing (800) 428-6051
(Code 309043).
Standard Pacific, one of the nation's largest homebuilders, has built
homes for more than 59,000 families during its 37-year history. The Company
constructs homes within a wide range of price and size targeting a broad range
of homebuyers. Standard Pacific operates in some of the strongest housing
markets in the country with operations in major metropolitan areas in
California, Texas, Arizona, Colorado, Florida and the Carolinas. The Company
provides mortgage financing and title services to its homebuyers through its
subsidiaries and joint ventures, Family Lending Services, SPH Mortgage, WRT
Financial, Westfield Home Mortgage, Universal Land Title of South Florida and
SPH Title. For more information about the Company and its new home
developments please visit our website at: www.standardpacifichomes.com .
This news release contains forward-looking statements. These statements
include but are not limited to statements regarding: the Company's growing
market position; improving operating performance, including expected returns
on shareholders' equity; the outlook for the remainder of 2003 and 2004; the
Company's plan to use a portion of the proceeds from its recent 61/2% senior
notes offering to retire higher cost debt; that 60% of 2004 profits are
expected to be generated in the second half of the year; orders and backlog;
the Company's three to four year lot supply; expected new community openings
and active sub-divisions; the Company's earnings, deliveries and revenue
estimates for the fourth quarter, full year 2003 and 2004; the Company's
expected SG&A rate; expected average home prices; the Company's expected
homebuilding gross margin percentage for 2003; and expected joint venture
income and deliveries. Forward-looking statements are based on current
expectations or beliefs regarding future events or circumstances, and you
should not place undue reliance on these statements. Such statements involve
known and unknown risks, uncertainties, assumptions and other factors -- many
of which are out of our control and difficult to forecast -- that may cause
actual results to differ materially from those that may be described or
implied. Such factors include but are not limited to: local and general
economic and market conditions, including consumer confidence, employment
rates, interest rates, the cost and availability of mortgage financing, and
stock market, home and land valuations; the impact on economic conditions of
terrorist attacks or the outbreak or escalation of armed conflict involving
the United States; the cost and availability of suitable undeveloped land,
building materials and labor; the cost and availability of construction
financing and corporate debt and equity capital; the demand for single-family
homes; cancellations of purchase contracts by homebuyers; the cyclical and
competitive nature of our business; governmental regulation, including the
impact of "slow growth" or similar initiatives; delays in the land entitlement
process, development, construction, or the opening of new home communities;
adverse weather conditions and natural disasters; environmental matters; risks
relating to our mortgage banking operations, including hedging activities;
future business decisions and our ability to successfully implement our
operational, growth and other strategies; litigation and warranty claims; and
other risks discussed in our filings with the Securities and Exchange
Commission, including in our Annual Report on Form 10-K for the year ended
December 31, 2002. We assume no, and hereby disclaim any, obligation to
update any of the foregoing or any other forward-looking statements. We
nonetheless reserve the right to make such updates from time to time by press
release, periodic report or other method of public disclosure without the need
for specific reference to this press release. No such update shall be deemed
to indicate that other statements not addressed by such update remain correct
or create an obligation to provide any other updates.
STANDARD PACIFIC CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
Three Months Ended
September 30,
Homebuilding: 2003 2002
Revenues $623,936 $462,252
Cost of sales (488,653) (386,666)
Gross margin 135,283 75,586
Selling, general and administrative expenses (58,239) (44,954)
Income from unconsolidated joint ventures 17,779 5,835
Interest expense (1,662) (1,472)
Other income 407 177
Homebuilding pretax income 93,568 35,172
Financial Services:
Revenues 4,064 2,881
Expenses (3,800) (2,272)
Income from unconsolidated joint ventures 864 656
Other income 106 93
Financial services pretax income 1,234 1,358
Income before taxes 94,802 36,530
Provision for income taxes (36,905) (13,913)
Net Income $57,897 $22,617
Earnings Per Share:
Basic $1.78 $0.70
Diluted $1.72 $0.68
Weighted Average Common Shares Outstanding:
Basic 32,571,581 32,540,965
Diluted 33,589,951 33,409,731
Cash Dividends Per Share $0.08 $0.08
Selected Operating Data
Three Months Ended
September 30,
New homes delivered: 2003 2002
Southern California 617 401
Northern California 111 137
Total California 728 538
Texas 116 118
Arizona 452 385
Colorado 59 74
Florida 584 289
Carolinas 141 99
Consolidated total 2,080 1,503
Unconsolidated joint ventures:
Southern California 110 37
Northern California 54 25
Total unconsolidated joint ventures 164 62
Total 2,244 1,565
Average selling price of homes delivered:
California (excluding joint ventures) $500,000 $500,000
Texas $265,000 $291,000
Arizona $178,000 $173,000
Colorado $307,000 $299,000
Florida $182,000 $194,000
Carolinas $138,000 $140,000
Consolidated (excluding joint ventures) $298,000 $307,000
Unconsolidated joint ventures (California) $545,000 $509,000
Total (including joint ventures) $316,000 $315,000
Net new orders:
Southern California 382 433
Northern California 295 126
Total California 677 559
Texas 120 114
Arizona 546 317
Colorado 88 63
Florida 464 430
Carolinas 120 71
Consolidated total 2,015 1,554
Unconsolidated joint ventures:
Southern California 59 141
Northern California 74 36
Total unconsolidated joint ventures 133 177
Total 2,148 1,731
Average number of selling communities
during the period:
Southern California 18 24
Northern California 17 11
Texas 18 25
Arizona 19 18
Colorado 12 12
Florida 30 19
Carolinas 8 5
Consolidated total 122 114
Unconsolidated joint ventures:
Southern California 3 7
Northern California 5 3
Total unconsolidated joint ventures 8 10
Total 130 124
Selected Operating Data (continued)
At September 30,
Backlog (in homes): 2003 2002
Southern California 966 1,048
Northern California 431 230
Total California 1,397 1,278
Texas 167 186
Arizona 946 675
Colorado 176 92
Florida 1,541 1,301
Carolinas 130 117
Consolidated total 4,357 3,649
Unconsolidated joint ventures:
Southern California 198 226
Northern California 129 89
Total unconsolidated joint ventures 327 315
Total 4,684 3,964
Backlog (estimated dollar value in thousands):
Consolidated total $1,389,030 $1,076,819
Unconsolidated joint ventures (California) 167,429 171,170
Total $1,556,459 $1,247,989
Building sites owned or controlled:
Southern California 9,126 6,173
Northern California 3,589 3,168
Total California 12,715 9,341
Texas 3,095 2,812
Arizona 5,013 4,063
Colorado 1,622 1,576
Florida 11,827 7,838
Carolinas 3,234 2,097
Total 37,506 27,727
Total building sites owned 19,469 15,692
Total building sites optioned 11,890 9,517
Total joint venture lots 6,147 2,518
Total 37,506 27,727
Completed and unsold homes 80 227
Homes under construction 4,197 3,710
Selected Financial Data
(Dollars in thousands)
Three Months Ended
September 30,
2003 2002
Net income(1) $57,897 $22,617
Net cash provided by (used in)
operating activities(1) $69,601 $(35,992)
Net cash provided by (used in)
investing activities(1) $(18,042) $(80,200)
Net cash provided by (used in)
financing activities(1) $127,661 $101,941
Adjusted Homebuilding EBITDA(2) $105,270 $51,679
Homebuilding SG&A as a percentage
of homebuilding revenues 9.3% 9.7%
Homebuilding interest incurred $20,037 $15,181
Homebuilding interest capitalized
to inventories owned $18,375 $13,709
Ratio of LTM Adjusted Homebuilding EBITDA
to homebuilding interest incurred 4.8x 4.1x
(1) As determined in accordance with accounting principles generally
accepted in the United States.
(2) Adjusted Homebuilding EBITDA means net income (plus cash
distributions of income from unconsolidated joint ventures) before
(a) income taxes, (b) homebuilding interest expense, (c) expensing of
previously capitalized interest included in cost of sales, (d)
noncash impairment charges, if any, (e) homebuilding depreciation and
amortization, (f) income from unconsolidated joint ventures, and (g)
income from financial services subsidiary. Other companies may
calculate Adjusted Homebuilding EBITDA (or similarly titled measures)
differently. We believe Adjusted Homebuilding EBITDA information is
useful to investors as a measure of our ability to service debt and
obtain financing. However, it should be noted that Adjusted
Homebuilding EBITDA is a non-GAAP financial measure. Due to the
significance of the GAAP components excluded, Adjusted Homebuilding
EBITDA should not be considered in isolation or as an alternative to
net income, cash flow from operations or any other operating or
liquidity performance measure prescribed by accounting principles
generally accepted in the United States. The tables set forth below
reconcile net cash provided by (used in) operating activities and net
income, calculated and presented in accordance with accounting
principles generally accepted in the United States, to Adjusted
Homebuilding EBITDA:
Four Fiscal
Three Months Ended Quarters Ended
September 30, September 30,
2003 2002 2003 2002
(Dollars in thousands)
Net cash provided by (used in)
operating activities $69,601 $(35,992) $(11,975) $41,891
Add:
Income taxes 36,905 13,913 112,986 63,282
Homebuilding interest
expense 1,662 1,472 6,593 4,584
Expensing of previously
capitalized interest
included in cost
of sales 18,686 10,022 59,383 46,291
Noncash impairment
charges -- 8,952 -- 14,351
Less:
Income from financial
services subsidiary 264 609 5,487 3,805
Depreciation and
amortization from
financial services
subsidiary 83 51 302 176
Net changes in operating
assets and liabilities:
Mortgages, other notes
and receivables (16,676) 12,428 6,268 10,583
Inventories-owned 22,743 65,083 246,391 61,106
Inventories-not owned 1,094 (12,857) (21,234) (14,263)
Deferred income taxes 4,099 (2,310) (2,395) (2,006)
Other assets (4,332) 7,464 (650) 8,163
Accounts payable (4,066) (3,333) 2,000 6,781
Accrued liabilities (29,766) (12,503) (89,698) (12,076)
Liabilities from
inventories not owned 5,667 -- 31,478 --
Adjusted Homebuilding
EBITDA $105,270 $51,679 $333,358 $224,706
Selected Financial Data (continued)
Four Fiscal
Three Months Ended Quarters Ended
September 30, September 30,
2003 2002 2003 2002
(Dollars in thousands)
Net income $57,897 $22,617 $176,944 $97,692
Add:
Cash distributions of
income from unconsolidated
joint ventures 8,219 1,220 37,062 27,839
Income taxes 36,905 13,913 112,986 63,282
Homebuilding interest
expense 1,662 1,472 6,593 4,584
Expensing of previously
capitalized interest
included in cost of sales 18,686 10,022 59,383 46,291
Noncash impairment charges -- 8,952 -- 14,351
Homebuilding depreciation
and amortization 808 583 3,152 2,794
Less:
Income from unconsolidated
joint ventures 18,643 6,491 57,275 28,322
Income from our financial
services subsidiary 264 609 5,487 3,805
Adjusted Homebuilding
EBITDA $105,270 $51,679 $333,358 $224,706
Balance Sheet Data
(Dollars in thousands, except per share amounts)
At September 30,
2003 2002
Stockholders' equity per share $27.56 $22.51
Ratio of total debt to total book
capitalization (1) 56.0% 51.4%
Ratio of adjusted net homebuilding
debt to total book capitalization (2) 47.9% 49.2%
Ratio of total debt to LTM adjusted
homebuilding EBITDA (1) 3.4x 3.5x
Ratio of adjusted net homebuilding debt
to LTM adjusted homebuilding EBITDA (2) 2.5x 3.2x
Homebuilding interest capitalized in
inventories owned $38,818 $35,409
Homebuilding interest capitalized as
a percentage of inventories owned 2.4% 2.5%
(1) Total debt at September 30, 2003 and 2002 includes $52.1 million and
$56.3 million, respectively, of indebtedness of the Company's
financial services subsidiary and $1.7 million and $0 million,
respectively, of indebtedness included in liabilities from
inventories not owned.
(2) Net homebuilding debt reflects the offset of $262.6 million and
$6.8 million in cash and equivalents at September 30, 2003 and 2002,
respectively, against homebuilding debt of $1,090 million and
$722 million, respectively. Adjusted net homebuilding debt at
September 30, 2003 and 2002 is further adjusted to exclude
$52.1 million and $56.3 million, respectively, of indebtedness of the
Company's financial services subsidiary and $1.7 million and $0,
respectively, of indebtedness included in liabilities from
inventories not owned. We believe that the adjusted net homebuilding
debt to total book capitalization and net adjusted homebuilding debt
to LTM adjusted homebuilding EBITDA ratios are useful to investors as
a measure of our ability to obtain financing. These are non-GAAP
ratios and other companies may calculate these ratios differently.
STANDARD PACIFIC CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
Nine Months Ended
September 30,
Homebuilding: 2003 2002
Revenues $1,538,866 $1,192,899
Cost of sales (1,219,360) (986,198)
Gross margin 319,506 206,701
Selling, general and administrative expenses (156,768) (111,271)
Income from unconsolidated joint ventures 39,906 13,341
Interest expense (5,149) (4,045)
Other income 1,034 357
Homebuilding pretax income 198,529 105,083
Financial Services:
Revenues 13,882 8,580
Expenses (10,478) (6,187)
Income from unconsolidated joint ventures 2,253 1,482
Other income 210 189
Financial services pretax income 5,867 4,064
Income before taxes 204,396 109,147
Provision for income taxes (79,747) (42,753)
Net Income $124,649 $66,394
Earnings Per Share:
Basic $3.85 $2.14
Diluted $3.74 $2.07
Weighted Average Common Shares Outstanding:
Basic 32,361,335 31,037,223
Diluted 33,337,208 32,013,143
Cash Dividends Per Share $0.24 $0.24
Selected Operating Data
Nine Months Ended
September 30,
New homes delivered: 2003 2002
Southern California 1,356 1,115
Northern California 352 403
Total California 1,708 1,518
Texas 345 365
Arizona 1,095 1,038
Colorado 170 211
Florida 1,430 517
Carolinas 380 99
Consolidated total 5,128 3,748
Unconsolidated joint ventures:
Southern California 301 114
Northern California 107 25
Total unconsolidated joint ventures 408 139
Total 5,536 3,887
Average selling price of homes delivered:
California (excluding joint ventures) $505,000 $474,000
Texas $270,000 $283,000
Arizona $179,000 $173,000
Colorado $309,000 $325,000
Florida $182,000 $205,000
Carolinas $136,000 $140,000
Consolidated (excluding joint ventures) $296,000 $318,000
Unconsolidated joint ventures (California) $544,000 $513,000
Total (including joint ventures) $314,000 $325,000
Net new orders:
Southern California 1,466 1,605
Northern California 626 558
Total California 2,092 2,163
Texas 366 404
Arizona 1,474 1,187
Colorado 258 225
Florida 1,937 711
Carolinas 429 71
Consolidated total 6,556 4,761
Unconsolidated joint ventures (California)
Southern California 275 327
Northern California 193 114
Total unconsolidated joint ventures 468 441
Total 7,024 5,202
Average number of selling communities
during the period:
Southern California 21 24
Northern California 14 13
Texas 20 24
Arizona 21 20
Colorado 12 11
Florida 30 9
Carolinas 9 2
Consolidated total 127 103
Unconsolidated joint ventures:
Southern California 4 6
Northern California 5 2
Total unconsolidated joint ventures 9 8
Total 136 111
STANDARD PACIFIC CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
September 30, December 31,
2003 2002
(Unaudited)
ASSETS
Homebuilding:
Cash and equivalents $262,554 $22,245
Mortgage notes receivable and accrued interest 6,009 3,682
Other notes and receivables 36,286 34,451
Inventories:
Owned 1,602,791 1,267,374
Not owned 107,120 108,389
Investments in and advances to
unconsolidated joint ventures 141,262 122,460
Property and equipment, net 7,317 7,524
Deferred income taxes 17,548 18,611
Other assets 22,479 19,097
Goodwill 60,908 58,062
2,264,274 1,661,895
Financial Services:
Cash and equivalents 13,837 5,406
Mortgage loans held for sale 57,021 109,861
Other assets 3,040 14,964
73,898 130,231
Total Assets $2,338,172 $1,792,126
LIABILITIES AND STOCKHOLDERS' EQUITY
Homebuilding:
Accounts payable $72,828 $71,439
Accrued liabilities 173,582 147,677
Liabilities from inventories not owned 18,585 46,155
Trust deed and other notes payable 18,421 16,670
Senior notes payable 922,614 473,469
Senior subordinated notes payable 148,915 148,854
1,354,945 904,264
Financial Services:
Accounts payable and other liabilities 2,257 2,116
Mortgage credit facilities 52,110 111,988
54,367 114,104
Total Liabilities 1,409,312 1,018,368
Minority Interests 30,320 --
Stockholders' Equity:
Preferred stock, $0.01 par value;
10,000,000 shares authorized;
none issued -- --
Common stock, $0.01 par value;
100,000,000 shares authorized;
32,605,983 and 32,183,630 shares
outstanding, respectively 326 322
Additional paid-in capital 377,619 369,723
Retained earnings 520,595 403,713
Total Stockholders' Equity 898,540 773,758
Total Liabilities and
Stockholders' Equity $2,338,172 $1,792,126
SOURCE Standard Pacific Corp.
-0- 10/27/2003
/CONTACT: Andrew H. Parnes, Senior Vice President of Standard Pacific
Corp., +1-949-789-1616/
/Web site: http://www.standardpacifichomes.com /
(SPF)
CO: Standard Pacific Corp.
ST: California
IN: CST FIN RLT
SU: ERN ERP CCA