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Sep 30, 2022
LGI Homes Q3 2022 Earnings Report
LGI Homes reported a decrease in net income but delivered profitability records through cost controls and pricing actions.
Key Takeaways
LGI Homes announced its Q3 2022 financial results, reporting a decrease in net income by 10.1% to $90.4 million, with home sales revenues decreasing by 27.2% to $547.1 million. However, the company achieved profitability records, including a gross margin of 28.5% and an adjusted gross margin of 29.5%.
Net Income decreased 10.1% to $90.4 million, or $3.88 Basic EPS and $3.85 Diluted EPS.
Home Sales Revenues decreased 27.2% to $547.1 million.
Home Closings decreased 38.1% to 1,547 homes closed.
Average Sales Price Per Home Closed increased 17.6% to $353,635.
Forward Guidance
The Company now expects to close between 6,700 and 7,100 homes at an average sales price between $340,000 and $350,000 and to end the year with between 95 and 100 active communities.
Positive Outlook
- Home closings between 6,700 and 7,100
- Active selling communities at the end of 2022 between 95 and 100
- Average sales price per home closed between $340,000 and $350,000
- Gross margin as a percentage of home sales revenues between 27.7% and 28.7%
- Adjusted gross margin (non-GAAP) as a percentage of home sales revenues between 29.0% and 30.0%
Challenges Ahead
- SG&A as a percentage of home sales revenues between 11.0% and 12.0%
- Effective tax rate between 21.0% and 22.0%
- General economic conditions, including input costs, materials, product and labor availability, mortgage rates and availability
- Construction costs, availability of land, and land development costs in the remainder of 2022
Historical Earnings Impact
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Avg. Return Before/After Earnings
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