Yahoo Finance

• Home Sales Revenue: $1.5 billion for 2024.

• New Home Deliveries: 2,831 homes in 2024.

• Fourth Quarter Revenue Growth: 22% year-over-year.

• Cash Flow from Operations: $47.8 million in the fourth quarter.

• Net New Orders: 636 in the fourth quarter, a 60% increase over Q4 2023.

• Fourth Quarter Home Closings: 937 homes.

• Pretax Income: $6.5 million for the fourth quarter.

• Net Income: $3 million or $0.08 per diluted share for the fourth quarter.

• Adjusted Net Income: $9.1 million or $0.25 per share for the fourth quarter.

• Gross Margin: 12.5% in the fourth quarter; 14.7% for the full year.

• Adjusted Gross Margin: 18.4% in the fourth quarter; over 20% for the year.

• SG&A as Percentage of Revenue: 12.5% in the fourth quarter; 13.5% for the full year.

• Debt to Total Capital: 51.8% at year-end.

• Net Debt to Total Capital: 47.7% at year-end.

• Liquidity: $241.8 million, including $57.2 million in cash and cash equivalents.

• Expected 2025 Deliveries: 3,000 to 3,400 units.

• Expected Average Sales Price for 2025: $500,000 to $525,000.

• Warning! GuruFocus has detected 5 Warning Sign with LTH.

Release Date: February 27, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Landsea Homes Corp (NASDAQ:LSEA) achieved record home sales revenue of $1.5 billion and new home deliveries of 2,831 in 2024.

• The company expanded its presence in Texas by acquiring Antares Homes, enhancing its market position.

• Landsea Homes Corp (NASDAQ:LSEA) reported a 22% year-over-year growth in top-line revenue for the fourth quarter.

• The High Performance Homes series continues to differentiate the company with a focus on innovation, energy efficiency, and sustainability.

• The company successfully executed a secondary offering, diversifying its shareholder base and reducing ownership concentration.

Negative Points

• Persistently high mortgage rates and buyer hesitancy have pressured profitability, necessitating increased incentives.

• Gross margins were below expectations due to rising incentives, with a 300 basis point increase in discounts and incentives compared to the previous year.

• The company anticipates elevated incentive levels through 2025, impacting margins.

• Land cost inflation has been a driver of margin pressure, and the company is negotiating with land partners to address future costs.

• The company faces challenges with affordability due to higher mortgage rates, property taxes, and insurance increases.

Q & A Highlights

Q: You mentioned expecting incentives to come down to 7% or 8% in the first quarter. Is this due to a shift towards build-to-order homes or market trends? A: John Ho, CEO: It's a combination of both. We're seeing incentives trend down in the market and shifting our portfolio towards build-to-order homes, which have higher margins and require fewer incentives.