EXHIBIT 99.1
NEWS RELEASE
CONTACTS: Joseph A. Santangelo - Chief Financial Officer
Orleans Homebuilders, Inc. (215) 245-7500
(www.orleanshomes.com)
FOR IMMEDIATE RELEASE:
ORLEANS HOMEBUILDERS REPORTS RESULTS
FOR SECOND QUARTER 2006 AND REAFFIRMS
GUIDANCE FOR FISCAL YEAR 2006
BENSALEM, PENNSYLVANIA, FEBRUARY 8, 2006:
Orleans Homebuilders, Inc. (ASE:OHB) is a residential homebuilder with
operations in Southeastern Pennsylvania; Central and Southern New Jersey; Orange
County, New York; Charlotte, Greensboro and Raleigh, North Carolina; Richmond
and Tidewater Virginia; Orlando, Palm Coast and Palm Bay, Florida; Chicago,
Illinois; and Phoenix, Arizona.
Fiscal Year 2006 Guidance:
o The Company reaffirms its fiscal year ending June 30, 2006
guidance for Diluted Earnings per Share of $3.38 to $3.43.
o The Company reaffirms its fiscal year ending June 30, 2006
guidance with respect to revenue of $990 million to $1.02
billion.
Financial Highlights for the Second Quarter Ended December 31, 2005:
o Fiscal year 2006 second quarter residential property revenue
increased 24% to $220,912,000 (540 homes) compared with
$178,278,000 (522 homes) for the prior year period.
o Fiscal year 2006 second quarter new orders increased 4% to
$163,416,000 (361 homes) compared with $157,321,000 (384 homes)
for the prior year period.
o Fiscal year 2006 second quarter net income increased 87% to
$15,416,000 ($.82 per diluted share) compared to $8,230,000 ($.44
per diluted share) for the prior year period.
o Fiscal year 2006 second quarter EBITDA (1) increased 76% to
$29,002,000 compared with $16,504,000 for the prior year period.
o The backlog at December 31, 2005 remained relatively flat
year-over-year at approximately $600,000,000.
o In December 2005, the Company entered the Phoenix, Arizona market
as a start-up operation via the purchase of an undeveloped parcel
of land. The Company anticipates further acquisitions of
undeveloped parcels of land in this region and expects revenue
during the second half of fiscal year 2007.
o The Company currently controls approximately 18,000 building
lots, a 13% increase compared to the approximately 16,000 lots
controlled at December 31, 2004.
o In November 2005, the Company issued $75,000,000 of trust
preferred securities which mature on January 30, 2036 and have a
fixed interest rate of 8.61% for the first ten years.
o In January, 2006, the Company entered into a three year Amended
and Restated Revolving Credit Loan Agreement increasing its
Senior Secured Revolving Credit and Letter of Credit Facility
from $500 million to $650 million, expandable to $750 million
under certain circumstances.
o The Company repurchased 90,900 shares of its common stock during
the 2nd quarter of fiscal year 2006 at an aggregate purchase
price of $1,744,000.
Financial Highlights for the Six Months Ended December 31, 2005:
o Fiscal year 2006 year-to-date residential property revenue
increased 20% to $378,875,000 (964 homes) compared with
$316,590,000 (927 homes) for the prior year period.
o Fiscal year 2006 year-to-date new orders increased 29% to
$424,765,000 (950 homes) compared with $328,118,000 (850 homes)
for the prior year period.
o Fiscal year 2006 year-to-date net income increased 41% to
$23,194,000 ($1.23 per diluted share) compared to $16,432,000
($.88 per diluted share) for the prior year period.
o Fiscal year 2006 year-to-date EBITDA(1) increased 38% to
$44,949,000 compared with $32,548,000 for the prior year period.
"We are extremely pleased with our second quarter and year-to-date increase
in net income of 76% and 38%, respectively. While new orders increased by 4% for
the second quarter, year-to-date new orders are up 29% over the prior year.
During the second quarter, all of our regions except for the Northern Region
reported an increase in new orders. In the Northern Region we are cautiously
optimistic that sales will improve as model homes in our newer replacement
communities are completed and communities experiencing approval delays begin to
come on line. Given our backlog at December 31, 2005 and anticipated sales in
the third quarter of fiscal year 2006, we believe we will achieve our revenue
and earnings guidance for fiscal 2006. In addition, given our geographic
locations, controlled lot positions and entry into Phoenix, we believe we are
well positioned for continued new order, revenue and earnings growth," commented
Jeffery Orleans, Chairman and CEO.
Orleans Homebuilders will hold its quarterly conference call to discuss
fiscal year results on Thursday, February 9, 2006, at 10:00 a.m. Eastern Time.
This call is being web cast by CCBN and can be accessed at Orleans Homebuilders'
web site at www.orleanshomes.com by clicking on the heading "Investor
Relations". The webcast is also being distributed over CCBN's Investor
Distribution Network to both institutional and individual investors. Individual
investors can listen to the call through CCBN's individual investor center at
www.earnings.com or by visiting any of the investor sites in CCBN's Individual
Investor Network. Institutional investors can access the call via CCBN's
password-protected event management site, StreetEvents (www.streetevents.com).
A replay of the conference call will be available later that day on the
Company's website at www.orleanshomes.com. A copy of this press release,
including the Company's results of operations for the three and six months ended
December 31, 2005 to be discussed during the conference call, is available at
the Company's website, www.orleanshomes.com, under the heading "Investor
Relations".
About Orleans Homebuilders, Inc.
Orleans Homebuilders, Inc. develops, builds and markets high-quality
single-family homes, townhouses and condominiums. The Company serves a broad
customer base including luxury, move-up, empty nester, active adult, and
first-time homebuyers. The Company currently operates in the following fourteen
distinct markets: Southeastern Pennsylvania; Central and Southern New Jersey;
Charlotte, Raleigh and Greensboro, North Carolina; Richmond and Tidewater
Virginia; Orlando, Palm Coast and Palm Bay, Florida; Orange County, New York;
Chicago, Illinois; and Phoenix, Arizona. The Company's Charlotte, North Carolina
operations also include adjacent counties in South Carolina. To learn more about
Orleans Homebuilders, please visit www.orleanshomes.com.
(1)Reconciliation of EBITDA to net income
THREE MONTHS THREE MONTHS SIX MONTHS SIX MONTHS
ENDED 12/31/05 ENDED 12/31/04 ENDED 12/31/05 ENDED 12/31/04
-------------- -------------- -------------- --------------
EBITDA $ 29,002,000 $ 16,504,000 $ 44,949,000 $ 32,548,000
Income tax expense 9,940,000 5,225,000 15,562,000 10,500,000
Interest 3,211,000 2,633,000 5,430,000 4,850,000
Depreciation 435,000 416,000 763,000 766,000
Net income $ 15,416,000 $ 8,230,000 $ 23,194,000 $ 16,432,000
(1) Pursuant to the requirements of Regulation G, we have provided a
reconciliation of EBITDA, a non-GAAP financial measure, to the most
directly comparable GAAP financial measure. EBITDA represents net earnings
before interest expense, previously capitalized interest amortized to
residential properties cost of sales, income taxes, depreciation,
amortization, and extraordinary items. For purposes of Regulation G, a
non-GAAP financial measure is a numerical measure of a registrant's
historical or future financial performance, financial position or cash
flows that excluded amounts, or is subject to adjustments that have the
effect of excluding amounts, that are included in the most directly
comparable measure calculated and presented in accordance with GAAP in the
statement of operations, balance sheet, or statement of cash flows of the
issuer; or includes amounts, that are excluded from the most directly
comparable measure so calculated and presented. In this regard, GAAP refers
to generally accepted accounting principles in the United States of
America. The Company believes EBITDA provides a meaningful measure of
operating performance.
Certain information included herein and in other Company statements, reports and
SEC filings is forward-looking within the meaning of the Private Securities
Litigation Reform Act of 1995, including, but not limited to, statements
concerning anticipated earnings per share, operating results, financial
resources, pace of sales, growth and expansion. 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 statements, reports and SEC filings. For example,
there can be no assurance that the current sales pace can continue in the
absence of an improvement in the current general economic environment. These
risks and uncertainties include local, regional and national economic
conditions, 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, the availability and cost of labor and materials, our dependence on
certain key employees and weather conditions. Additional information concerning
factors the Company believes could cause its actual results to differ materially
from expected results is contained in Item 7 of the Company's Annual Report of
Form 10-K for the fiscal year ended June 30, 2005 filed with the SEC.
ORLEANS HOMEBUILDERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
----------------------- -----------------------
2005 2004 2005 2004
---------- ---------- ---------- ----------
Earned revenues
Residential properties $ 220,912 $ 178,278 $ 378,875 $ 316,590
Land sales and other income 3,739 1,730 5,417 3,580
---------- ---------- ---------- ----------
224,651 180,008 384,292 320,170
---------- ---------- ---------- ----------
Costs and expenses
Residential properties 169,302 141,954 292,587 251,545
Land sales and other expense 2,765 1,424 4,374 2,409
Selling, general and administrative 27,228 23,160 48,575 39,255
Interest, net - 15 - 29
---------- ---------- ---------- ----------
199,295 166,553 345,536 293,238
---------- ---------- ---------- ----------
Income from operations before income taxes 25,356 13,455 38,756 26,932
Income tax expense 9,940 5,225 15,562 10,500
---------- ---------- ---------- ----------
Net income available for common shareholders $ 15,416 $ 8,230 $ 23,194 $ 16,432
========== ========== ========== ==========
Earnings per share:
Basic $ 0.83 $ 0.47 $ 1.25 $ 0.94
========== ========== ========== ==========
Diluted $ 0.82 $ 0.44 $ 1.23 $ 0.88
========== ========== ========== ==========
Weighted average number of shares:
Basic 18,549 17,544 18,548 17,534
========== ========== ========== ==========
Diluted 18,888 18,773 18,890 18,767
========== ========== ========== ==========
ORLEANS HOMEBUILDERS, INC
SUMMARY OF DELIVERIES, NEW ORDERS AND BACKLOG BY REGION
(DOLLARS IN THOUSANDS)
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
----------------------- -----------------------
2005 2004 2005 2004
---------- ---------- ---------- ----------
DELIVERIES
Northern Region (NJ, PA) (1)
Homes 189 154 326 309
Dollars $ 90,145 $ 68,418 $ 149,198 $ 135,701
Average Sales Price $ 477 $ 444 $ 458 $ 439
Southern region (NC, SC, VA) (2)
Homes 199 163 355 279
Dollars $ 79,083 $ 58,265 $ 138,883 $ 98,713
Average Sales Price $ 397 $ 357 $ 391 $ 354
Florida region (FL)
Homes 72 117 151 206
Dollars $ 17,848 $ 19,428 $ 35,727 $ 33,831
Average Sales Price $ 248 $ 166 $ 237 $ 164
Midwestern region (IL) (3)
Homes 80 88 132 133
Dollars $ 33,836 $ 32,167 $ 55,067 $ 48,345
Average Sales Price $ 423 $ 366 $ 417 $ 363
Total
Homes 540 522 964 927
Dollars $ 220,912 $ 178,278 $ 378,875 $ 316,590
Average Sales Price $ 409 $ 342 $ 393 $ 342
NEW ORDERS
Northern Region (NJ, PA) (1)
Homes 81 110 257 274
Dollars $ 47,078 $ 63,109 $ 139,242 $ 140,546
Average Sales Price $ 581 $ 574 $ 542 $ 513
Southern region (NC, SC, VA) (2)
Homes 172 147 430 277
Dollars $ 75,307 $ 56,177 $ 188,967 $ 103,605
Average Sales Price $ 438 $ 382 $ 439 $ 374
Florida region (FL)
Homes 52 73 152 179
Dollars $ 17,024 $ 15,998 $ 49,063 $ 37,727
Average Sales Price $ 327 $ 219 $ 323 $ 211
Midwestern region (IL) (3)
Homes 56 54 111 120
Dollars $ 24,007 $ 22,037 $ 47,493 $ 46,240
Average Sales Price $ 429 $ 408 $ 428 $ 385
Total
Homes 361 384 950 850
Dollars $ 163,416 $ 157,321 $ 424,765 $ 328,118
Average Sales Price $ 453 $ 410 $ 447 $ 386
(1) Information on residential revenue earned and new orders includes the
acquired operations of Realen Homes' Southeastern Pennsylvania region from July
28, 2004, the acquisition date, through December 31, 2005.
(2) Information on residential revenue earned and new orders includes the
acquired activity from Peachtree Residential Properties for the period beginning
December 23, 2004, the date the company acquired the assets, through December
31, 2005.
(3) Information on residential revenue earned and new orders includes the
acquired operations of Realen Homes' Midwestern region from July 28, 2004, the
acquisition date, through December 31, 2005.
AT DECEMBER 31, AT DECEMBER 31,
2005 2004
--------------- ---------------
BACKLOG
Northern Region (NJ, PA) (1)
Homes 466 625
Dollars $ 240,565 $ 287,664
Average Sales Price $ 516 $ 460
Southern region (NC, SC, VA) (2)
Homes 448 410
Dollars $ 208,375 $ 161,035
Average Sales Price $ 465 $ 393
Florida region (FL)
Homes 360 292
Dollars $ 99,538 $ 56,744
Average Sales Price $ 276 $ 194
Midwestern region (IL) (3)
Homes 118 253
Dollars $ 50,649 $ 95,573
Average Sales Price $ 429 $ 378
Total
Homes 1,392 1,580
Dollars $ 599,127 $ 601,016
Average Sales Price $ 430 $ 380
(1) The backlog at December 31, 2004, includes the acquired backlog of Realen
Homes' Southeastern Pennsylvania region not delivered as of December 31, 2004.
(2) The backlog at December 31, 2004, includes the backlog acquired in the
Peachtree Residential Properties acquisition not delivered as of December 31,
2004.
(3) The backlog at December 31, 2004 includes the acquired backlog of Realen
Homes' Midwestern region not delivered as of December 31, 2004.
ORLEANS HOMEBUILDERS, INC
SELECTED BALANCE SHEET DATA
(IN THOUSANDS)
(UNAUDITED)
DECEMBER 31, JUNE 30,
2005 2005
------------- -------------
Cash and cash equivalents $ 42,699 $ 62,576
Restricted cash - due from title company 9,007 28,785
Residential properties 257,297 190,855
Land and improvements 490,018 398,290
Inventory not owned 121,120 88,252
Land deposits and costs of future developments 29,390 27,408
Total assets 1,025,749 861,540
Obligations related to inventory not owned 108,970 79,585
Mortgage obligations secured by real estate 431,652 399,030
Subordinated notes 105,000 -
Other notes payable 5,894 9,400
Shareholders' equity 253,867 231,956
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