LGI Homes Q2 2023 Earnings Report
Key Takeaways
LGI Homes announced strong second-quarter results with a 35.7% increase in home closings compared to the first quarter, generating $645.3 million in revenue. The company's focus on affordability and backlog strength drove the performance, leading to increased profitability and raised full-year closing and margin guidance.
Net income reached $53.1 million, resulting in $2.26 basic EPS and $2.25 diluted EPS.
Home sales revenues amounted to $645.3 million with 1,854 home closings.
The average sales price per home closed was $348,042.
Gross margin stood at 22.0%, with adjusted gross margin at 23.8%.
LGI Homes
LGI Homes
LGI Homes Revenue by Geographic Location
Forward Guidance
LGI Homes raised its full-year closing guidance to a range between 6,500 and 7,200 homes and increased its full-year gross margin guidance to a range between 21.5% and 23.5%, and adjusted gross margin guidance to a range between 23.0% and 25.0%. The company anticipates having 115 to 125 active communities at year-end, with an additional 20% to 30% growth in community count in 2024.
Positive Outlook
- Home closings between 6,500 and 7,200.
- Active selling communities at the end of 2023 between 115 and 125.
- Average sales price per home closed between $345,000 and $360,000.
- Gross margin as a percentage of home sales revenues between 21.5% and 23.5%.
- Adjusted gross margin as a percentage of home sales revenues between 23.0% and 25.0%.
Challenges Ahead
- General economic conditions, including input costs, materials, product and labor availability.
- Interest rates and mortgage availability.
- Construction costs.
- Availability of land.
- Land development costs.
Revenue & Expenses
Visualization of income flow from segment revenue to net income