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Dec 31, 2022
Forestar Q1 2023 Earnings Report
Reported a decrease in net income and revenue due to moderating demand for new single-family housing and finished lots.
Key Takeaways
Forestar reported a decrease in net income and revenue for the first quarter of fiscal year 2023, with net income attributable to Forestar totaling $20.8 million and revenues of $216.7 million. The company's gross profit margin increased to 21.9%, and pre-tax profit margin was 12.9%.
Net income attributable to Forestar totaled $20.8 million or $0.42 per diluted share.
Consolidated revenues totaled $216.7 million on 2,263 lots sold.
Pre-tax income reached $27.9 million, resulting in a pre-tax profit margin of 12.9%.
The company had over $580 million of liquidity at quarter end.
Forestar
Forestar
Forestar Revenue by Segment
Revenue by Segment
Residential Lot Sales Revenue
CapyFin.comTract Sales and Other Revenue
CapyFin.com Forward Guidance
While we are not providing annual guidance at this time due to uncertainty in the market, we expect to continue consolidating market share in the fragmented and under-capitalized U.S. residential lot development industry. Our strong balance sheet and ample liquidity provide us with significant financial and operational flexibility, and we plan to maintain our disciplined approach when investing capital to enhance the long-term value of Forestar.
Positive Outlook
- Ability to deliver strong profitability and returns through challenging market conditions.
- Continue to strive to maximize returns by balancing our pace of sales and lot pricing.
- Stay focused on strengthening our platform and increasing operational efficiencies to drive future growth.
- Continue consolidating market share in the fragmented and under-capitalized U.S. residential lot development industry.
- Maintain our disciplined approach when investing capital to enhance the long-term value of Forestar.
Challenges Ahead
- Uncertainty in the market makes it difficult to provide annual guidance.
- Demand for new single-family housing and finished lots continuing to moderate.
- Significant increase in mortgage interest rates.
- Housing market is going through a period of transition.
- Cannot control the macroeconomic backdrop or directly influence the demand for housing.
Revenue & Expenses
Visualization of income flow from segment revenue to net income