Exhibit 99.1
For Immediate Release For additional information contact:
Peter J. O'Hanlon or Jon M. Donnell
(614) 761-6000
Dominion Homes Reports Record
Net Income for the Second Quarter of 2002
DUBLIN, Ohio - July 24, 2002 - Dominion Homes (NASDAQ:DHOM) reported net income
for the three months ending June 30, 2002 increased 119% to $6.3 million from
$2.9 million for the three months ended June 30, 2001. Fully diluted earnings
per share increased to $0.94 per share for second quarter 2002 compared to $0.44
per share for the same period the previous year. The Company sold 1,450,000 of
its shares in a public offering that closed on June 28, 2002. The stock offering
had a minimal dilutive impact on second quarter earnings per share.
Revenues for second quarter 2002 increased by 47% to $133.2 million from the
delivery of 702 homes compared to revenues of $90.6 million for second quarter
2001 from the delivery of 466 homes. The Company closed 236 more homes during
second quarter 2002 due to the record first quarter backlog, an increased number
of closings of our new Independence Series homes which have a shorter build time
than our conventional homes and the mild weather conditions experienced during
the winter months. The average price of homes delivered during second quarter
2002 decreased to approximately $185,000 compared to $192,000 during second
quarter 2001. This decrease was anticipated due to the increased number of our
lower priced Independence Series homes that closed.
Gross profit increased by 42% to $29.3 million for second quarter 2002 from
$20.6 million for second quarter 2001. The $8.7 million improvement in gross
profit was due primarily to the increase in homes delivered during the quarter.
The increase in gross profit was partially offset by higher selling, general and
administrative expenses, which resulted primarily from the increased variable
costs associated with selling more homes and from operating the mortgage
services subsidiary. Interest expense was comparable between the two quarters.
Net income for the first six months of 2002 increased 157% to $10.4 million from
$4.0 million for the same period last year. Fully diluted earnings per share
increased to $1.56 per share for the first six months of 2002 compared to $0.62
per share for the same period the previous year. Revenues for the first six
months of 2002 increased 47% to $231.5 million from the delivery of 1,220 homes
compared to revenues for the same period of the previous year of $158.0 million
from the delivery of 813 homes. Gross profit for the first six months of 2002
increased by 46% to $52.2 million from $35.8 million the previous year.
As previously reported, the Company sold a second quarter record 625 homes
during the three months ending June 30, 2002, representing a sales value of
$112.2 million, compared to 589 homes, representing a sales value of $109.6
million, during second quarter 2001. The Company sold 1,342 homes during the
first six months of 2002, representing a sales value of $245.7 million, compared
to 1,295 homes, representing a sales value of $242.9 million for the first six
months of 2001. The Company had a backlog of 1,154 contracts, with a sales value
of $223.7 million, on June 30, 2002 compared to a backlog of 1,259 contracts,
with a sales value of $242.7 million, on June 30, 2001.
On June 28, 2002, the Company sold 1,450,000 of its shares at a public offering
price of $20 per share. After expenses the net proceeds added approximately
$26.2 million of additional capital, which initially has been used to reduce
debt. Shareholders' equity at June 30, 2002 was $118.1 million. At June 30, 2002
there were 8,120,751 common shares issued and 8,050,231 common shares
outstanding.
Dominion Homes, which is included in the Year 2001 List of the "200 Best Small
Companies" published by Forbes Magazine, offers three distinct series of homes
which are differentiated by size, price, standard features and available
options. The Company's "The Best of Everything" philosophy focuses on providing
its customers with unsurpassed products, quality, and customer service. There
are currently over 50 Dominion Homes locations in Central Ohio and Louisville,
Kentucky. Additional information about Dominion Homes and its homes is located
on the world wide web at www.dominionhomes.com.
Certain statements in this news release are "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995. Such
statements involve known and unknown risks, uncertainties and other factors that
may cause actual results to differ materially. Such risks, uncertainties and
other factors include, but are not limited to, weather conditions, changes in
general economic conditions, fluctuations in interest rates, increases in raw
materials and labor costs, levels of competition and other factors described in
the Company's Annual Report and Form 10-K for the year ended December 31, 2001
and our Registration Statement filed on May 31, 2002. All forward-looking
statements made in this press release are based on information presently
available to the management of the Company. The Company assumes no obligation to
update any forward-looking statements.
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except share and per share amounts)
Consolidated Statements of Operations
Three Months Ended Six Months Ended
June 30, 2002 June 30, 2002
2002 2001 2002 2001
---------------------------------------------------------------------
Revenues $ 133,162 $ 90,649 $ 231,540 $ 158,011
Cost of real estate sold 103,865 70,066 179,307 122,213
----------- ---------- ----------- -----------
Gross profit 29,297 20,583 52,233 35,798
Selling, general and administrative 15,790 12,826 29,632 23,539
----------- ---------- ----------- -----------
Income from operations 13,507 7,757 22,601 12,259
Interest expense 2,766 2,800 4,865 5,296
----------- ---------- ----------- -----------
Income before income taxes 10,741 4,957 17,736 6,963
Provision for income taxes 4,446 2,083 7,370 2,926
----------- ---------- ----------- -----------
Net income $ 6,295 $ 2,874 $ 10,366 $ 4,037
=========== ========== =========== ===========
Earnings per share
Basic $ 0.96 $ 0.45 $ 1.59 $ 0.64
=========== ========== =========== ===========
Diluted $ 0.94 $ 0.44 $ 1.56 $ 0.62
=========== ========== =========== ===========
Weighted average shares outstanding
Basic 6,572,576 6,354,001 6,519,471 6,353,593
=========== ========== =========== ===========
Diluted 6,695,781 6,563,561 6,638,189 6,559,306
=========== ========== =========== ===========
Consolidated Balance Sheet
June 30 December 31
2002 2001
---- ----
ASSETS
Cash and cash equivalents $ 2,836 $ 5,619
Accounts receivable, net 2,751 2,882
Real estate inventories 238,933 230,024
Prepaid expenses and other 4,735 3,963
Deferred income taxes 7,016 5,865
Net property and equipment 5,829 6,193
----------- -----------
Total assets $ 262,100 $ 254,546
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Note payable, banks $ 99,362 $ 131,511
Term debt 1,131 2,358
Other Liabilities 43,508 39,110
----------- -----------
Total liabilities 144,001 172,979
Total shareholders' equity 118,099 81,567
----------- -----------
Total liabilities and shareholders' equity $ 262,100 $ 254,546
=========== ===========
Lot summary as of June 30, 2002
The following table sets forth the Company's land inventory as of June
30, 2002:
Finished Lots Under Unimproved Land Total
Land Inventory Lots Development Estimated Lots Estimated Lots
- ---------------------------------- ----------------- ----------------- --------------------- ------------------
Owned by the Company:
Central Ohio 841 1,553 5,234 7,628
Louisville, Kentucky 137 127 230 494
Controlled by the Company:
Central Ohio - - 7,282 7,282
Louisville, Kentucky - - 619 619
---------------- ---------------- -------------------- -----------------
978 1,680 13,365 16,023
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