EXHIBIT 99.1
FOR IMMEDIATE RELEASE CONTACT: Frederick N. Cooper (215) 938-8312
February 23, 2005 fcooper@tollbrothersinc.com
Joseph R. Sicree (215) 938-8045
jsicree@tollbrothersinc.com
TOLL BROTHERS' RECORD 1ST QTR NET INCOME RISES 120% TO $110.2 MILLION
RECORD 1ST QTR CONTRACTS GROW 60% TO $1.44 BILLION
RECORD 1ST QTR REVENUES RISE 67% TO $999.1 MILLION
RECORD 1ST QTR-END BACKLOG INCREASES 66% TO $4.89 BILLION
Horsham, PA, February 23, 2005 -- Toll Brothers, Inc., (NYSE:TOL)
(www.tollbrothers.com), the nation's leading builder of luxury homes, today
reported record results for earnings, revenues, contracts and backlog for its
first quarter ended January 31, 2005. First quarter 2005 earnings per share of
$1.33 increased 115% over first quarter 2004.
Robert I. Toll, chairman and chief executive officer, stated: "We are enjoying
strong pricing power and increasing profit margins as demand for luxury homes
continues to outpace supply."
Joel H. Rassman, chief financial officer, noted: "With the highest backlog in
our history, which includes most of this year's projected deliveries, we are
raising our guidance on FY 2005 deliveries to a range of between 8,050 and 8,400
homes. Based on the strength of our first quarter earnings and the increase in
expected deliveries, we also are raising our earnings guidance: We now believe
net income will grow approximately 60% in FY 2005 over FY 2004."
Robert Toll continued: "Continuing strong demand, a recovering economy, our
diversified offerings in the luxury move-up, active-adult, and empty-nester
urban and suburban niches, and our growing portfolio of well-positioned
communities in upscale markets all bode well for our future prospects: Based on
these factors, as we have previously discussed, we believe fiscal 2006 will be
another record year.
"Increasing numbers of high-income households are competing for a constrained
supply of home sites; gaining approvals to build in affluent, well-located
neighborhoods is a complex, expensive and lengthy undertaking. In response to
the widening gap between tight supply and growing demand, we continue to expand
our pipeline of land under development. We now control over 63,000 home sites -
a five-to-six year supply based on our historic pace of expansion. With this
land, attractive demographics, our diversity of products and our highly
respected brand name in the luxury market, we believe we are well-positioned for
continued growth in the years ahead."
*more*
Toll Brothers' financial highlights for the first quarter ended January 31,
2005:
o FY 2005 first-quarter net income of $110.2 million, ($1.33 per share
diluted), increased 120% over FY 2004 first-quarter net income of $50.1
million, ($0.62 per share diluted), the previous first-quarter record.
o FY 2005 first-quarter revenues of $999.1 million increased 67% over FY
2004 first-quarter revenues of $597.9 million. FY 2005 first-quarter
home building revenues of $989.1 million (1,590 homes), increased 68%
over FY 2004's first-quarter home building revenues of $589.6 million
(1,085 homes), the previous first-quarter record. Revenues from land
sales totaled $1.2 million for FY 2005's first quarter, compared to
$6.0 million in FY 2004's.
o In addition, in the Company's fiscal 2005 first quarter, unconsolidated
entities in which the Company had an interest delivered $26.4 million
(63 homes) compared to $1.5 million (5 homes) in the first quarter of
fiscal 2004. The Company's share of the profits from the delivery of
these homes is included in 'Equity Earnings in Unconsolidated Entities'
on the Company's Income Statement.
o The Company's FY 2005 first-quarter contracts of $1.44 billion (2,173
homes), grew by 60% over FY 2004's first-quarter contracts of $902.8
million (1,512 homes), the previous first-quarter record. In addition,
in first quarter 2005, unconsolidated entities in which the Company had
an interest signed contracts of $15.6 million (36 homes).
o FY 2005 first-quarter-end backlog of $4.89 billion (7,292 homes), the
highest backlog in the Company's history, increased 66% over FY 2004's
record first-quarter-end backlog of $2.95 billion (5,079 homes), the
previous first-quarter record. In addition, at the end of fiscal 2005's
first quarter, unconsolidated entities in which the Company had an
interest had a backlog of $65.0 million (147 homes).
o The Company raised its guidance on the number of homes it expects to
deliver in FY 2005: it now expects to deliver between 8,050 and 8,400
homes, an increase from its previous projection range of 7,900 to 8,300
homes. Based on the strength of first quarter earnings and the increase
in expected deliveries, the Company now believes net income will grow
approximately 60% in FY 2005 over FY 2004, compared to its previous
guidance of more than 40% net income growth in FY 2005.
*more*
Toll Brothers will be broadcasting live via the Investor Relations section of
its website, WWW.TOLLBROTHERS.COM, a conference call hosted by chairman and
chief executive officer Robert I. Toll at 2:00 p.m. (EST) today, February 23,
2005, to discuss these results and our outlook for the remainder of fiscal 2005.
Prior to this conference call, the company intends to file a Form 8-K with the
Securities and Exchange Commission containing its guidance for expected results
of operations for Fiscal 2005 which will be discussed on the call. To access the
call, enter the Toll Brothers website, then click on the Investor Relations
page, and select "Conference Calls". Participants are encouraged to log on at
least fifteen minutes prior to the start of the presentation to register and
download any necessary software. The call can be heard live with an on-line
replay which will follow and continue through May 9, 2005.
Toll Brothers, Inc. is the nation's leading builder of luxury homes. The Company
began business in 1967 and became a public company in 1986. Its common stock is
listed on the New York Stock Exchange and the Pacific Exchange under the symbol
"TOL". The Company serves move-up, empty-nester, active-adult and second-home
home buyers and operates in 20 states: Arizona, California, Colorado,
Connecticut, Delaware, Florida, Illinois, Massachusetts, Maryland, Michigan,
Nevada, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island,
South Carolina, Texas, and Virginia.
Toll Brothers builds luxury single-family detached and attached home
communities, master planned luxury residential resort-style golf communities and
urban low, mid- and high-rise communities, principally on land it develops and
improves. The Company operates its own architectural, engineering, mortgage,
title, land development and land sale, golf course development and management,
home security, landscape, cable T.V. and broadband Internet delivery
subsidiaries. The Company also operates its own lumber distribution, and house
component assembly and manufacturing operations.
Toll Brothers is the only publicly traded national home building company to have
won all three of the industry's highest honors: America's Best Builder from the
National Association of Home Builders, the National Housing Quality Award and
Builder of the Year. For more information visit WWW.TOLLBROTHERS.COM.
Certain information included herein and in other Company reports, SEC 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 concerning anticipated operating results, financial resources,
changes in revenues, changes in profitability, interest expense, growth and
expansion, anticipated income from joint ventures and the Toll Brothers Realty
Trusts Group, the ability to acquire land, the ability to secure governmental
approvals and the ability to open new communities, the ability to sell homes and
properties, the ability to deliver homes from backlog, the average delivered
price of homes, the ability to secure materials and subcontractors, the ability
to maintain the liquidity and capital necessary to expand and take advantage of
future opportunities, and stock market valuations. 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, SEC filings, statements and
presentations. These risks and uncertainties include local, regional and
national economic conditions, the demand for homes, domestic and international
political events, uncertainties created by terrorist attacks, the effects of
governmental regulation, the competitive environment in which the Company
operates, fluctuations in interest rates, changes in home prices, the
availability and cost of land for future growth, the availability of capital,
uncertainties and fluctuations in capital and securities markets, changes in tax
laws and their interpretation, legal proceedings, the availability of adequate
insurance at reasonable cost, the ability of customers to finance the purchase
of homes, the availability and cost of labor and materials, and weather
conditions.
*more*
TOLL BROTHERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
January 31, October 31,
2005 2004
---- ----
(Unaudited)
ASSETS
Cash and cash equivalents $ 485,411 $ 580,863
Inventory 4,145,727 3,878,260
Property, construction and office equipment, net 58,176 52,429
Receivables, prepaid expenses and other assets 154,050 146,212
Mortgage loans receivable 74,395 99,914
Customer deposits held in escrow 69,344 53,929
Investments in and advances to
unconsolidated entities 109,871 93,971
------------ -----------
$ 5,096,974 $ 4,905,578
============ ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Loans payable $ 372,408 $ 340,380
Senior notes 845,790 845,665
Senior subordinated notes 450,000 450,000
Mortgage company warehouse loan 64,416 92,053
Customer deposits 329,150 291,424
Accounts payable 192,404 181,972
Accrued expenses 555,982 574,202
Income taxes payable 178,193 209,895
------------ -----------
Total liabilities 2,988,343 2,985,591
------------ -----------
Stockholders' equity:
Common stock 770 770
Additional paid-in capital 232,728 200,938
Retained earnings 1,880,923 1,770,730
Treasury stock (5,790) (52,451)
------------ ------------
Total stockholders' equity 2,108,631 1,919,987
------------ -----------
$ 5,096,974 $ 4,905,578
============ ===========
TOLL BROTHERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
(Unaudited)
Quarter ended
January 31,
2005 2004
----- ----
Revenues:
Home sales $ 989,097 $ 589,577
Land sales 1,225 5,987
Equity earnings in unconsolidated entities 1,935 665
Interest and other 6,883 1,683
--------- ---------
999,140 597,912
--------- ---------
Costs and expenses:
Home sales 685,493 422,428
Land sales 779 5,303
Selling, general and administrative expenses 107,065 76,653
Interest 21,812 14,558
--------- ---------
815,149 518,942
--------- ---------
Income before income taxes 183,991 78,970
Income taxes 73,798 28,886
--------- ---------
Net income $ 110,193 $ 50,084
========= =========
Earnings per share:
Basic $ 1.51 $ 0.68
========= =========
Diluted $ 1.33 $ 0.62
========= =========
Weighted average number of shares:
Basic 72,826 73,839
Diluted 83,042 80,819
UNITS $ (MILL)
1ST QTR. 1ST QTR. 1ST QTR. 1ST QTR.
CLOSINGS 2005 2004 2005 2004
- ------------------------------- -------- -------- -------- --------
NORTHEAST
(CT, MA, NH, NJ, NY, RI) 229 183 123.3 104.6
MID-ATLANTIC (DE, MD, PA, VA) 663 405 386.9 201.4
MIDWEST (IL, MI, OH) 95 72 57.0 40.9
SOUTHEAST (FL, NC, SC, TN) 155 121 84.4 53.7
SOUTHWEST (AZ, CO, NV, TX) 248 149 155.8 81.8
WEST COAST (CA) 200 155 181.7 107.2
----- ----- ------- -------
1,590 1,085 989.1 589.6
UNCONSOLIDATED ENTITIES 63 5 26.4 1.5
----- ----- ------- -------
1,653 1,090 1,015.5 591.1
===== ===== ======= =======
CONTRACTS
- -------------------------------
NORTHEAST
(CT, MA, NH, NJ, NY, RI) 319 222 200.6 137.9
MID-ATLANTIC (DE, MD, PA, VA) 767 527 471.4 283.8
MIDWEST (IL, MI, OH) 112 120 78.0 71.7
SOUTHEAST (FL, NC, SC, TN) 381 174 205.4 85.4
SOUTHWEST (AZ, CO, NV, TX) 366 233 254.3 143.5
WEST COAST (CA) 228 236 233.4 180.5
----- ----- ------- -------
2,173 1,512 1,443.1 902.8
UNCONSOLIDATED ENTITIES 36 5 15.6 1.6
----- ----- ------- -------
2,209 1,517 1,458.7 904.4
===== ===== ======= =======
BACKLOG
- -------------------------------
NORTHEAST
(CT, MA, NH, NJ, NY, RI) 1,118 971 676.8 552.7
MID-ATLANTIC (DE, MD, PA, VA) 2,349 1,796 1,456.8 919.5
MIDWEST (IL, MI, OH) 463 342 305.4 194.0
SOUTHEAST (FL, NC, SC, TN) 952 464 584.5 250.1
SOUTHWEST (AZ, CO, NV, TX) 1,469 793 948.2 458.5
WEST COAST (CA) 941 713 916.2 570.3
----- ----- ------- -------
7,292 5,079 4,887.9 2,945.1
UNCONSOLIDATED ENTITIES 147 15 65.0 4.8
----- ----- ------- -------
7,439 5,094 4,952.9 2,949.9
===== ===== ======= =======
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