EXHIBIT 99.1
[PULTE HOMES LOGO]
FOR IMMEDIATE RELEASE Investor Relations
Contact: James Zeumer
Vice President
(248) 433-4597
email: jim.zeumer@pulte.com
Media Relations
Contact: Valerie Dolenga
Corporate Communications
(248) 433-4633
email: valerie.dolenga@pulte.com
PULTE HOMES REPORTS RECORD FOURTH QUARTER RESULTS, AS INCOME FROM CONTINUING
OPERATIONS INCREASES 44 PERCENT TO $172 MILLION, OR $2.78 PER SHARE
- - Q4 ORDERS INCREASE 23%; YEAREND BACKLOG JUMPS 22% TO 10,605 HOMES VALUED AT
$2.9 BILLION
- - DOMESTIC CLOSINGS FOR THE QUARTER REACH A RECORD 9,528
- - FULL YEAR 2002 INCOME FROM CONTINUING OPERATIONS CLIMBS 47% TO $445
MILLION, OR $7.20 PER SHARE
- - RETURN ON EQUITY FOR THE YEAR CLIMBS TO 18%, AS NET DEBT TO TOTAL
CAPITALIZATION DROPS TO 32%
BLOOMFIELD HILLS, MI, JANUARY 28, 2003 - Pulte Homes, Inc. (NYSE: PHM)
today announced record financial results for its fourth quarter and year ended
December 31, 2002. Fourth quarter income from continuing operations was a record
$172 million, or $2.78 per share, an increase of 44% over prior year fourth
quarter income of $120 million, or $1.99 per share.
Consolidated fourth quarter revenues for the Company increased 27% to a
record $2.5 billion. For the year, Pulte reported record revenues of $7.5
billion, representing a 39% increase over the prior year and the first time the
Company's revenues have topped $7 billion.
Commenting on the Company's financial results, Mark J. O'Brien,
President and CEO said, "We are very pleased with the record-setting financial
results Pulte Homes delivered in the fourth quarter and for the entire year of
2002. These results demonstrate the Company's success in growing its business,
integrating the Del Webb operations and continuing to improve overall financial
returns to our shareholders."
"Pulte Homes enters 2003 with tremendous momentum and the opportunity
to further expand its share of the homebuilding market," said O'Brien. "Based on
the increase in Pulte Homes' Q4 orders and forecasts suggesting an improving
economy in 2003, we continue to target year-over-year growth in earnings of 10
to 15 percent, which puts our 2003 earnings in the range of $7.85 to $8.25 per
share."
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FOURTH QUARTER RESULTS
Revenues from domestic homebuilding settlements for the fourth quarter
increased 24% to a record $2.4 billion. Higher revenues for the period were the
result of an 8% increase in average selling price to $247,000, combined with a
14% increase in total home deliveries to 9,528 houses. The higher average
selling price for the period reflects a combination of price increases and
changes in the mix of homes delivered.
Domestic homebuilding gross margins for the period were 20.1%, up 60
basis points over prior year reported margins of 19.5%. Prior year margins were
reduced by 20 basis points reflecting purchase accounting adjustments associated
with Pulte's acquisition of Del Webb in July 2001. Pre-tax income for the fourth
quarter was $278.8 million, up 40% over the same period last year.
Domestic homebuilding land sales for the fourth quarter generated $89.8
million in revenues and $27.4 million in gross profit, as compared to $66.0
million and $13.9 million, respectively, last year. Land sales are an important
element of Pulte Homes' domestic homebuilding operations, but can fluctuate from
quarter-to-quarter depending upon the timing of individual transactions.
Domestic net new home orders for the quarter were 6,458, up 23% from
the prior year fourth quarter orders of 5,249 homes. Pulte's ending backlog for
its domestic operations was valued at $2.9 billion (10,605 homes), as compared
to a value of $ 2.1 billion (8,678 homes) last year.
Fourth quarter revenues for the Company's financial services operations
increased 30% to $31.9 million. Higher revenues for the period were driven by a
19% increase in originations to 8,114 loans. Higher homebuilding volumes,
combined with an expanded capture rate of 79.7%, helped drive increased loan
production for the period. Higher loan volumes and a favorable interest rate
environment helped drive fourth quarter pre-tax income of $19.1 million, an
increase of 42% over the prior year pre-tax income of $13.5 million.
For the fourth quarter, Pulte's International operations reported
pre-tax income of $3.3 million, well ahead of the pre-tax loss of $0.3 million
last year. Improved fourth quarter performance in the Company's Argentina and
Puerto Rico operations was partially offset by fewer closings in Mexico caused
by slower local mortgage fundings during the period.
FULL YEAR RESULTS
For the year ended December 31, 2002, Pulte Homes consolidated revenues
were a record $7.5 billion, an increase of 39% over prior year revenues of $5.4
billion. Higher revenues reflect growth throughout the Company's operations and
the inclusion of a full year of Del Webb results. For 2002, Pulte reported
income from continuing operations of $444.6 million, or $7.20 per share, up 47%
over prior year income of $302.4 million, or $6.01 per share.
Revenues from domestic homebuilding settlements were a record $7.0
billion, an increase of 36% over prior year revenues of $5.1 billion. Revenues
for the period benefited from a 26% increase in closings to 28,903 homes,
combined with an 8%, or $17,000 increase in the average sales price per home to
$242,000. Full-year gross margins for Pulte's domestic operations increased 30
basis points to 20.1%. Pre-tax income for the year rose to $719.0 million, an
increase of 40% over the prior year. Land sales for the year generated $176.3
million in revenues and $53.0 million in gross profit.
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Pulte's financial services operations reported pre-tax income for the year of
$66.7 million, as compared to $36.9 million in 2001. The improved performance
for the year reflects a 21% increase in loan originations and improved secondary
marketing gains resulting from the favorable interest rate environment. Pulte's
International operations reported pre-tax income of $5.1 million, reversing a
prior year pre-tax loss of $2.4 million, as the Company experienced improved
performance throughout its operations in Argentina and Mexico.
Strong fourth quarter closings helped push Pulte Homes year end cash
position to over $600 million, while its net debt to total capitalization
dropped to 32% from 44% last year. For the year, Pulte Homes' return on equity
increased to 18%, as the Company began realizing the benefits of its successful
integration of the Webb business.
"Our strong cash position at the end of the quarter provides Pulte
Homes with a strong financial base and tremendous flexibility heading into
2003," said Roger Cregg, Senior Vice President and Chief Financial Officer.
"Between growing our business, the opportunity to redeem the scheduled and
optional retirement of over $400 million in currently outstanding debt and our
share repurchase authorization, we have great opportunities to effectively
utilize our existing funds and the strong cash flows expected from the business
in the coming year."
"With almost 11,000 homes in backlog and a well positioned land
portfolio, Pulte Homes enters 2003 in a very strong competitive position," said
O'Brien. We continue to expand Pulte Homes' penetration of the first time, first
and second-move up and active adult segments within the markets we operate. The
year ahead should also see an expansion of the Del Webb brand into a number of
new markets across the country."
A conference call discussing Pulte's fourth quarter results will be
held today at 8.30 a.m. Eastern Time, and web cast live via Pulte.com.
Interested investors can access the call via the Company's home page at
www.pulte.com.
CERTAIN STATEMENTS IN THIS RELEASE CONSTITUTE "FORWARD-LOOKING STATEMENTS"
WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. SUCH
FORWARD-LOOKING STATEMENTS INVOLVE KNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS
THAT MAY CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO
BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS
EXPRESSED OR IMPLIED BY THE FORWARD-LOOKING STATEMENTS. SUCH FACTORS INCLUDE,
AMONG OTHER THINGS, (1) GENERAL ECONOMIC AND BUSINESS CONDITIONS; (2) INTEREST
RATE CHANGES AND THE AVAILABILITY OF MORTGAGE FINANCING; (3) THE RELATIVE
STABILITY OF DEBT AND EQUITY MARKETS; (4) COMPETITION; (5) THE AVAILABILITY AND
COST OF LAND AND OTHER RAW MATERIALS USED BY THE COMPANY IN ITS HOMEBUILDING
OPERATIONS; (6) THE AVAILABILITY AND COST OF INSURANCE COVERING RISKS ASSOCIATED
WITH OUR BUSINESS; (7) SHORTAGES AND THE COST OF LABOR; (8) WEATHER RELATED
SLOWDOWNS; (9) SLOW GROWTH INITIATIVES AND/OR LOCAL BUILDING MORATORIA; (10)
GOVERNMENTAL REGULATION, INCLUDING THE INTERPRETATION OF TAX, LABOR AND
ENVIRONMENTAL LAWS; (11) CHANGES IN CONSUMER CONFIDENCE AND PREFERENCES; (12)
REQUIRED ACCOUNTING CHANGES; (13) TERRORIST ACTS AND OTHER ACTS OF WAR; AND (14)
OTHER FACTORS OVER WHICH THE COMPANY HAS LITTLE OR NO CONTROL.
Pulte Homes, Inc., (www.pulte.com) based in Bloomfield Hills, Michigan,
has operations in 44 markets across the United States. Under its Del Webb
(www.delwebb.com) brand, the Company is also the nation's leading builder of
active adult communities for people age 55 and older. Over its history, the
Company has constructed more than 300,000 homes and has been named Builder of
the Year for 2002 by Professional Builder magazine. Pulte Mortgage, LLC is a
nationwide lender committed to meeting the financing needs of Pulte Homes'
customers by offering a wide variety of loan products and superior customer
service.
/Web site: http://www.pulte.com
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Pulte Homes, Inc.
Condensed Consolidated Results
Of Operations
Three Months Ended Year Ended
December 31, December 31,
-------------------------- --------------------------
2002 2001 2002 2001
----------- ----------- ----------- -----------
(000's omitted, except per share data)
(Unaudited)
CONSOLIDATED RESULTS:
Revenues:
Homebuilding $ 2,515,397 $ 1,980,670 $ 7,363,989 $ 5,309,829
Financial Services 31,926 24,481 106,628 77,222
Corporate 686 94 1,202 2,210
----------- ----------- ----------- -----------
Total Revenues $ 2,548,009 $ 2,005,245 $ 7,471,819 $ 5,389,261
=========== =========== =========== ===========
Pre-tax income (loss):
Homebuilding $ 282,031 $ 199,096 $ 724,067 $ 512,291
Financial Services 19,139 13,490 66,723 36,948
Corporate (19,198) (18,197) (61,968) (57,452)
----------- ----------- ----------- -----------
Income from continuing
operations before
income taxes 281,972 194,389 728,822 491,787
Income taxes (109,928) (74,853) (284,221) (189,362)
----------- ----------- ----------- -----------
Income from continuing
operations 172,044 119,536 444,601 302,425
Income (Loss) from
discontinued
operations (160) (95) 9,044 (1,032)
----------- ----------- ----------- -----------
Net income $ 171,884 $ 119,441 $ 453,645 $ 301,393
=========== =========== =========== ===========
EARNINGS PER SHARE -
ASSUMING DILUTION:
Income from continuing
operations $ 2.78 $ 1.99 $ 7.20 $ 6.01
Income (Loss) from
discontinued
operations - (.01) .15 (.02)
----------- ----------- ----------- -----------
Net income $ 2.78 $ 1.98 $ 7.35 $ 5.99
=========== =========== =========== ===========
Shares used in per
share calculations 61,824 60,187 61,746 50,323
=========== =========== =========== ===========
Certain 2001 classifications have been changed to conform with the 2002
presentation.
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Pulte Homes, Inc.
Condensed Consolidated Balance Sheets
($000's omitted)
(Unaudited)
December 31, December 31,
2002 2001
------------ ------------
ASSETS
Cash and equivalents $ 613,168 $ 72,144
Unfunded settlements 60,641 69,631
House and land inventories 4,293,597 3,833,763
Residential mortgage loans
available-for-sale 588,413 431,735
Goodwill 307,693 307,693
Intangible assets 151,954 159,604
Other assets 873,244 839,706
------------ ------------
$ 6,888,710 $ 5,714,276
============ ============
LIABILITIES AND SHAREHOLDERS'
EQUITY
Liabilities:
Accounts payable and accrued
liabilities $ 1,565,386 $ 1,155,702
Unsecured short-term
borrowings - 110,000
Collateralized short-term
debt, recourse solely to
financial services
subsidiary assets 559,621 413,675
Income taxes 90,009 35,370
Subordinated debentures and
senior notes 1,913,268 1,722,864
------------ ------------
4,128,284 3,437,611
Total Liabilities 2,760,426 2,276,665
------------ ------------
Shareholders' Equity $ 6,888,710 $ 5,714,276
============ ============
Certain 2001 classifications have been changed to conform with the 2002
presentation.
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Pulte Homes, Inc.
Segment Data
Three Months Ended
December 31,
2002 2001
----------- -----------
($000's omitted)
HOMEBUILDING:
Pre-tax income (loss):
Domestic $ 278,755 $ 199,399
International 3,276 (303)
----------- -----------
Total Homebuilding $ 282,031 $ 199,096
=========== ===========
Domestic Homebuilding:
Home sales (settlements) $ 2,353,696 $ 1,905,754
Land sales 89,801 66,005
----------- -----------
Domestic Homebuilding
Revenue 2,443,497 1,971,759
Home cost of sales (1,881,215) (1,533,851)
Land cost of sales (62,444) (52,145)
Selling, general
& administrative expense (197,099) (164,855)
Other expense, net (8,431) (8,847)
----------- -----------
EBIT 294,308 212,061
Interest (15,553) (12,662)
----------- -----------
Pre-tax income $ 278,755 $ 199,399
=========== ===========
International Homebuilding:
Home sales (settlements) $ 71,900 $ 8,911
Cost of sales (57,636) (8,031)
Selling, general
& administrative
expense (10,243) (2,879)
Other income (expense), net (161) (470)
Minority Interest (1,178) -
Equity in income of joint
venture operations 594 2,166
----------- -----------
Pre-tax income (loss) $ 3,276 $ (303)
=========== ===========
FINANCIAL SERVICES:
Pre-tax income $ 19,139 $ 13,490
=========== ===========
MORTGAGE
ORIGINATIONS:
Origination volume 8,114 6,809
=========== ===========
Origination
principal $ 1,349,700 $ 1,065,800
=========== ===========
CORPORATE:
Pre-tax loss:
Net interest expense $ (9,731) $ (10,641)
Other Corporate
expense, net (9,467) (7,556)
----------- -----------
Total Corporate $ (19,198) $ (18,197)
=========== ===========
Certain 2001 classifications have been changed to conform with the 2002
presentation.
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Pulte Homes, Inc.
Segment Data
Year Ended
December 31,
------------------------------
2002 2001
----------- -----------
($000's omitted)
HOMEBUILDING:
Pre-tax income (loss):
Domestic $ 719,010 $ 514,675
International 5,057 (2,384)
----------- -----------
Total Homebuilding $ 724,067 $ 512,291
=========== ===========
Domestic Homebuilding:
Home sales (settlements) $ 6,991,614 $ 5,145,526
Land sales 176,301 129,134
----------- -----------
Domestic Homebuilding
Revenue 7,167,915 5,274,660
Home cost of sales (5,589,465) (4,127,059)
Land cost of sales (123,306) (97,941)
Selling, general
& administrative expense (664,469) (482,128)
Other expense, net (22,968) (16,851)
----------- -----------
767,707 550,681
EBIT
Interest (48,697) (36,006)
----------- -----------
Pre-tax income $ 719,010 $ 514,675
=========== ===========
International Homebuilding:
Home sales (settlements) $ 196,074 $ 35,169
Cost of sales (157,056) (30,937)
Selling, general
& administrative
expense (35,029) (11,820)
Other income (expense), net (1,610) 66
Minority Interest (1,801) -
Equity in income of joint
venture operations 4,479 5,138
----------- -----------
Pre-tax income (loss) $ 5,057 $ (2,384)
=========== ===========
FINANCIAL SERVICES:
Pre-tax income $ 66,723 $ 36,948
=========== ===========
MORTGAGE
ORIGINATIONS:
Origination volume 23,074 19,018
=========== ===========
Origination
principal $ 3,771,000 $ 2,937,100
=========== ===========
CORPORATE:
Pre-tax loss:
Net interest expense $ (38,214) $ (34,261)
Other Corporate
expense, net (23,754) (23,191)
----------- -----------
Total Corporate $ (61,968) $ (57,452)
=========== ===========
Certain 2001 classifications have been changed to conform with the 2002
presentation.
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Pulte Homes, Inc.
Business Operating Data
Three Months Ended Year Ended
December 31, December 31,
----------------------- -----------------------
2002 2001 2002 2001
---------- ---------- ---------- ----------
(000's omitted)
HOMEBUILDING UNIT SETTLEMENTS
- - PULTE AND AFFILIATES:
Domestic 9,528 8,343 28,903 22,915
International 2,152 2,443 7,547 7,479
---------- ---------- ---------- ----------
Total Pulte and Pulte-
affiliate settlement
units 11,680 10,786 36,450 30,394
========== ========== ========== ==========
HOMEBUILDING SETTLEMENT
REVENUES -- PULTE AND
AFFILIATES:
Domestic $2,353,696 $1,905,754 $6,991,614 $5,145,526
International 76,791 69,881 236,797 215,790
---------- ---------- ---------- ----------
Total Pulte and Pulte-
affiliate revenues $2,430,487 $1,975,635 $7,228,411 $5,361,316
========== ========== ========== ==========
Domestic Homebuilding
Unit settlements:
Northeast 927 671 2,440 2,014
Southeast 2,585 2,757 8,271 8,126
Midwest 1,511 1,100 4,458 3,288
Central 1,734 1,472 4,588 3,982
West 2,771 2,343 9,146 5,505
---------- ---------- ---------- ----------
9,528 8,343 28,903 22,915
========== ========== ========== ==========
Unit net new orders:
Northeast 604 378 2,738 2,035
Southeast 1,831 1,726 8,651 8,544
Midwest 987 752 4,684 3,756
Central 824 708 4,590 4,071
West 2,212 1,685 10,167 7,710
---------- ---------- ---------- ----------
6,458 5,249 30,830 26,116
========== ========== ========== ==========
Unit backlog:
Northeast 1,129 831
Southeast 2,939 2,559
Midwest 1,601 1,375
Central 905 903
West 4,031 3,010
---------- ----------
10,605 8,678
========== ==========
International Homebuilding:
Unit settlements:
Pulte 2,122 43 6,525 221
Pulte-affiliated entities 30 2,400 1,022 7,258
---------- ---------- ---------- ----------
2,152 2,443 7,547 7,479
========== ========== ========== ==========
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