In This Article:
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Revenue: Decreased by 7% to $976 million.
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Gross Margin: 25.9%, down 120 basis points year over year.
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Net Income: Earnings per diluted share decreased to $3.98 from $4.78 last year.
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Pre-tax Income: Decreased by 19% to $146 million.
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Return on Equity: 19%.
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Community Count: 226, up from 219 a year ago.
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Homes Delivered: Decreased by 8% to 1,976 homes.
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New Contracts: Down 10% compared to last year.
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SG&A Expenses: 11.5% of revenue, up from 10.5% a year ago.
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Cash Balance: $776 million with no borrowings under the credit facility.
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Debt to Capital Ratio: 19%, down from 21% a year ago.
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Book Value per Share: $112, a $17 increase from a year ago.
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Mortgage and Title Operations Revenue: Increased 17% to $31.5 million.
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Average Closing Price: $476,000, a 1% increase from last year.
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EBITDA: $154 million, down from $187 million last year.
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Interest Income (Net of Expense): $5.2 million.
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Effective Tax Rate: 24% in the first quarter.
Release Date: April 23, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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M/I Homes Inc (NYSE:MHO) posted strong first-quarter results despite challenging macroeconomic conditions.
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The company achieved a gross margin of 25.9%, reflecting some pricing power and the positive impact of new communities.
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M/I Homes Inc (NYSE:MHO) ended the quarter with a record 226 communities and plans to grow its community count by an average of 5% in 2025.
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The company has a strong balance sheet with $3 billion in equity and no borrowings under its $650 million unsecured revolving credit facility.
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M/I Financial, the mortgage and title operations of M/I Homes Inc (NYSE:MHO), achieved a 31% increase in pre-tax income, setting a first-quarter revenue record.
Negative Points
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New contracts were down 10% compared to the previous year, indicating a decline in demand.
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Gross margins are expected to be under pressure throughout the year due to the continued use of mortgage rate buydowns.
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Homes delivered during the quarter decreased by 8%, and revenues decreased by 7% to $976 million.
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The spring selling season was described as 'just okay,' with demand remaining uneven and challenging.
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The company faces ongoing challenges from macroeconomic factors such as interest rate fluctuations, inflation concerns, and a volatile stock market.
Q & A Highlights
Q: Can you provide insights on buyer demand shifts across different price points and geographies? A: Robert Schottenstein, Chairman and CEO, noted no significant changes in demand across price points, with 54% of sales from the Smart Series targeting first-time buyers. Geographically, Tampa showed some recovery, while Indianapolis, Cincinnati, and Chicago performed well. Dallas and Houston remained strong, though Dallas slightly softened. Overall, the market remains challenging but not alarming.