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Sep 30, 2021
LGI Homes Q3 2021 Earnings Report
LGI Homes achieved record results, driven by increased home sales revenues and average sales price.
Key Takeaways
LGI Homes reported a record third quarter with a 13.0% increase in net income to $100.6 million, driven by a 40.7% increase in home sales revenues to $751.6 million and a 19.5% increase in home closings to 2,499 homes. The average sales price per home closed increased by 17.7% to $300,764, and the gross margin improved by 160 basis points to 26.9%.
Net income increased 13.0% to $100.6 million, or $4.05 Diluted EPS.
Home sales revenues increased 40.7% to $751.6 million.
Home closings increased 19.5% to 2,499 homes closed.
Average sales price per home closed increased 17.7% to $300,764.
LGI Homes
LGI Homes
Forward Guidance
The Company is providing updates to its guidance for the full year 2021.
Positive Outlook
- Home closings between 10,000 and 10,500
- Active selling communities at the end of 2021 between 100 and 105
- Average sales price per home closed between $285,000 and $295,000
- Gross margin as a percentage of home sales revenues between 26.5% and 27.5%
- Adjusted gross margin (non-GAAP) as a percentage of home sales revenues between 28.0% and 29.0%
Challenges Ahead
- SG&A as a percentage of home sales revenues between 9.0% and 9.5%
- Effective tax rate between 20.0% and 21.0%
- General economic conditions, including interest rates and mortgage availability, in the remainder of 2021 are similar to those experienced so far in the fourth quarter of 2021
- Average sales price per home closed, construction costs, availability of construction materials, availability of land, land development costs and overall absorption rates in the remainder of 2021 are consistent with the Company’s recent experience.
- Governmental regulations relating to land development, home construction and COVID-19 are similar to those currently in place.