Net Income: Taylor Morrison Home Corp. reported a net income of $190 million or $1.75 per diluted share.
Home Deliveries: Delivered 2,731 homes during the quarter.
Average Selling Price: The average selling price of homes was $599,000, producing total homebuilding revenue of $1.6 billion.
Gross Margin: Home closings gross margin was reported at 24%.
Net Sales Orders: Experienced a 29% year-over-year increase in net sales orders, amounting to 3,686 homes.
Cancellation Rates: Cancellation rates were low at just 7% of gross orders.
Financial Services Revenue: Generated $47 million with a gross margin of 46.5%.
Future Guidance
Home Deliveries Forecast: Expects to deliver approximately 12,500 homes for the full year, including about 175 homes in Indianapolis due to a new market entry.
Average Price Guidance: Anticipates an average selling price of $600,000 to $610,000 for the year.
Gross Margin Outlook: Forecasts a home closing gross margin between 23.5% and 24% for the full year.
SG&A Ratio: Targets an SG&A ratio in the high 9% range for this year.
Share Repurchase Plan: Plans to repurchase approximately $300 million of common stock within the year.
Trends, Market Conditions, Sentiment
Diversified Consumer Groups: Taylor Morrison’s strategy of diversifying across consumer groups and regions is highlighted as crucial for mitigating interest rate and affordability pressures.
First-Time Buyers: First-time buyers continue to represent a significant portion of sales, despite observed sensitivities to interest rates and affordability.
Operational Efficiencies: Improved operational efficiencies, including reduced cycle times and increased start volumes, were noted as key achievements.
Interest Rate Sensitivity: Acknowledged sensitivity of first-time buyers to interest rate fluctuations but balanced by strength across diversified consumer base.
Market Entry: Entry into the Indianapolis market is seen as a strategic move to capture growth in a resilient and growing market.
Strong Financial Position: Taylor Morrison’s balance sheet strength and liquidity position it well for future investment and shareholder returns.
Notable Quotes
Sheryl Palmer, CEO: “Our priority is driving growth and returns for our shareholders.”
Sheryl Palmer: “We believe that our diversification is truly a differentiator in our ability to compete in the marketplace.”
Sheryl Palmer: “With affordability remaining stretched for many consumers… our diversification has aided our ability to navigate these headwinds.”
Curt VanHyfte, CFO: “We are pleased with our first quarter results and the momentum we have built for the remainder of the year.”
Erik Heuser, COO: “Given the scarcity of finished lot deals, we have reduced our reliance on expensive finished lot acquisitions in favor of balance sheet-friendly self-developed land parcels.”
