2016 Fourth Quarter and Full Year ResultsMaracay Homes – Pardee Homes – Quadrant Homes – Trendmaker Homes – TRI Pointe Homes – Winchester Homes
Forward Looking Statement
Various statements contained in this presentation, including those that express a belief, expectation or intention, as well asthose that are not statements of historical fact, are forward-looking statements. These forward-looking statements may includeprojections and estimates concerning the timing and success of specific projects and our future production, land and lot sales, operational and financial results, financial condition, prospects, and capital spending. Our forward-looking statements are generally accompanied by words such as “estimate,” “project,” “predict,” “believe,” “expect,” “intend,” “anticipate,” “potential,” “plan,” “goal,” “target,” “guidance,” “outlook,” “will,” or other words that convey future events or outcomes. The forward-looking statements in this presentation speak only as of the date of this presentation, and we disclaim any obligation to update these statements unless required by law, and we caution you not to rely on them unduly. These forward-looking statements are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. The following factors, among others, may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements: the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages and strength of the U.S. dollar; market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; levels of competition; the successful execution of our internal performance plans, including restructuring and cost reduction initiatives; global economic conditions; raw material prices; oil and other energy prices; the effect of weather, including the continuing drought in California; the risk of loss from earthquakes, volcanoes, fires, floods, droughts, windstorms, hurricanes, pest infestations and other natural disasters; transportation costs; federal and state tax policies; the effect of land use, environment and other governmental regulations; legal proceedings or disputes and the adequacy of reserves; risks relating to any unforeseen changes to or effects on liabilities, future capital expenditures, revenues, expenses, earnings, synergies, indebtedness, financial condition, losses and future prospects; changes in accounting principles; risks related to unauthorized access to our computer systems, theft of our customers’ confidential information or other forms of cyber-attack; our relationship, and actual and potential conflicts of interest, with Starwood Capital Group or its affiliates; and additional factors discussed under the sections captioned “Risk Factors” included in our annual and quarterly reports filed with the Securities and Exchange Commission. The foregoing list is not exhaustive. New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business. This presentation includes certain non-GAAP financial metrics, including adjusted homebuilding gross margin and net debt-to-capital. These non-GAAP financial measures should be considered only as supplemental to, and not as superior to, financial measures prepared in accordance with GAAP. Please refer to the Supplemental Data and Reconciliation section of this presentation for a reconciliation of the non-GAAP financial measures included in this presentation to the most directly comparable financial measures prepared in accordance with GAAP. Winchester is a registered trademark and is used with permission.
Management Team
3
Michael GrubbsChief Financial Officer
• Over 25 years of real estate and homebuilding experience
• Former SVP / CFO of William Lyon Homes
Douglas BauerChief Executive Officer
• Over 25 years of real estate and homebuilding experience
• Former President and COO of William Lyon Homes
Thomas Mitchell President & COO
• Over 25 years of real estate and homebuilding experience
• Former EVP and Southern California Regional President at William Lyon Homes
Working together for over 25 years, TRI Pointe senior management has significant experience running a large, geographically diverse, growth-oriented public homebuilder. Deep managerial talent at each operating division with key local relationships supports dynamic tailored growth strategies.
A Family of Regional Homebuilders
A Family of Regional Homebuilders
2016 Orders: 4,248 2016 Deliveries: 4,211
2016 Home Sales (“HS”) Revenue: $2,329,336 2016 Average Sales Price (“ASP”): $553
Lots Owned or Controlled: 28,309
Market: Greater Puget Sound Area2016 Orders: 341 2016 Deliveries: 3832016 HS Revenue: $207,057 2016 ASP: $541Lots Owned or Controlled: 1,582
Markets: Los Angeles/Ventura, Inland Empire, San Diego, Las Vegas2016 Orders: 1,206 2016 Deliveries: 1,2202016 HS Revenue: $668,835 2016 ASP: $548Lots Owned or Controlled: 16,912
Markets: Orange County, Los Angeles, San Diego, San Francisco Bay Area, Denver2016 Orders: 1,097 2016 Deliveries: 1,0892016 HS Revenue: $723,186 2016 ASP: $664Lots Owned or Controlled: 3,479
Markets: Phoenix, Tucson2016 Orders: 670 2016 Deliveries: 6252016 HS Revenue: $255,253 2016 ASP: $408Lots Owned or Controlled: 2,053
Markets: Houston, Austin2016 Orders: 501 2016 Deliveries: 4742016 HS Revenue: $239,7342016 ASP: $506Lots Owned or Controlled: 1,999
Markets: Washington DC2016 Orders: 4332016 Deliveries: 4202016 HS Revenue: $235,271 2016 ASP: $560Lots Owned or Controlled: 2,284
Data as of December 31, 2016Note: Dollars in thousands
2016 Fourth Quarter and Full Year Highlights
2016 Fourth Quarter Highlights
• Absorption rate of 2.5 new home orders per community per month
• New home deliveries down 2% to 1,427 with an average sales price of $540K
• Home sales revenue down 9% to $771MM
• Homebuilding gross margin of 20.0%
• Adj. homebuilding gross margin of 22.2% (1)
• SG&A expense increased 80 basis points to 9.2% of home sales revenue compared to 8.4%
• Net income available to common stockholders of $57.9MM, or $0.36 per diluted share vs. $85.1MM or $0.52 per diluted share
• Repurchased 1,455,332 shares for $17.0MM at an average price of $11.66 per share
6(1) See “Reconciliation of Non-GAAP Measures” in the appendix of this presentation(2) Backlog (units) figures are as of December 31, 2016 and 2015, respectively
Metric 4Q 2016 4Q 2015 % Change
Orders 909 753 21%
Deliveries 1,427 1,453 -2%
ASP of Deliveries ($000s) $540 $583 -7%
Backlog (units) (2) 1,193 1,156 3%
Home Sales Revenue ($mm) $771 $847 -9%
HB Gross Margin 20.0% 22.2% -220 bps
Land and Lot Sales Revenue ($mm) $2.1 $26.9 -92%
Land and Lot Sales Profit ($mm) $1.7 $9.2 -82%
SG&A Expense (% of sales) 9.2% 8.4% +80 bps
EPS (Diluted) $0.36 $0.52 -30.8%
2016 Full Year Highlights
• Absorption rate of 3.0 new home orders per community per month
• New home deliveries up 4% to 4,211 with an average sales price of $553K
• Home sales revenue up 2% to $2,329MM
• Homebuilding gross margin of 21.2%
• Adj. homebuilding gross margin of 23.4% (1)
• Land and lot sales revenue of $72MM generating $55MM in profit
• SG&A expense increased 60 basis points to 10.8% of home sales revenue compared to 10.2%
• Net income available to common stockholders of $195.2MM, or $1.21 per diluted share vs. $205.5MM or $1.27 per diluted share
• Repurchased 3,560,853 shares for $42.1MM at an average price of $11.82 per share
7(1) See “Reconciliation of Non-GAAP Measures” in the appendix of this presentation(2) Backlog (units) figures are as of December 31, 2016 and 2015, respectively
Metric 2016 2015 % Change
Orders 4,248 4,181 2%
Deliveries 4,211 4,057 4%
ASP of Deliveries ($000s) $553 $565 -2%
Backlog (units) (2) 1,193 1,156 3%
Home Sales Revenue ($mm) $2,329 $2,291 2%
HB Gross Margin 21.2% 21.1% 10 bps
Land and Lot Sales Revenue ($mm) $72 $101 -29%
Land and Lot Sales Profit ($mm) $55 $66 -17%
SG&A Expense (% of sales) 10.8% 10.2% -60 bps
EPS (Diluted) $1.21 $1.27 -4.7%
Arizona14%
California33%
Maryland6%
Nevada9%
Colorado4%
Texas25%
Virginia3%
Washington6%
Active Selling Communities and Absorption Rate
8
104
124
3.0 3.0
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
25
50
75
100
125
150
2015 2016
Communities Absorption Rate
Active Selling Communities and Absorption RateAs of and for the years ended December 31, 2015 and 2016
Active Selling Communities by StateAs of December 31, 2016
Opened 10 new communities and closed 9 in 4Q16
Incr
eas
e 1
9%
YO
Y
Arizona15%
California30%
Maryland6%
Nevada9%
Colorado4%
Texas24%
Virginia5%
Washington7%
Average Selling Communities and Absorption Rate
9
99
116 118
134
2.5
3.0 3.0 3.1
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
25
50
75
100
125
150
2014 2015 2016 2017P
Communities Absorption Rate
Incr
eas
e 2
% Y
OY
Incr
eas
e 1
4%
YO
Y
Average Selling Communities and Absorption RateAs of and for the years ended December 31, 2014 through 2016 and 2017 projections
Average Selling Communities by StateFor the year ended December 31, 2016
Opened 63 new communities and closed 43 in 2016Expect to open over 60 new communities in 2017
Incr
eas
e 1
7%
YO
Y
See Forward Looking Statement disclosure on page 2 of the presentation
Arizona16%
California39%
Maryland8%
Nevada11%
Colorado3%
Texas13%
Virginia3%
Washington7%
New Home Orders – Q4 2016 Results
10
753
909
0
100
200
300
400
500
600
700
800
900
1,000
2015 2016
Incr
eas
e 2
1%
YO
Y
Fourth Quarter - New Home OrdersFor the quarters ended December 31, 2015 and 2016
New Home Orders by StateFor the quarter ended December31, 2016
Arizona16%
California40%
Maryland7%
Nevada11%
Colorado3%
Texas12%
Virginia3%
Washington8%
New Home Orders – FY 2014 through FY 2016
11
2,947
4,1814,248
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
2014 2015 2016
Incr
eas
e 2
% Y
OY
New Home OrdersFor the years ended December 31, 2014 through 2016
New Home Orders by StateFor the year ended December 31, 2016
Incr
eas
e 4
2%
YO
Y
Arizona17%
California36%
Maryland9%
Nevada6%
Colorado6%
Texas13%
Virginia3%
Washington10%
Backlog – Units and Dollar Value
12
Backlog – Units and Dollar ValueAs of December 31, 2015 and 2016 (dollars in thousands)
Backlog Dollar Value by StateAs of December 31, 2016
1,1561,193
0
200
400
600
800
1,000
1,200
Units
$697,334 $661,146
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$ Value
2015
2016
$603K $540KAverage Sales Price
in Backlog
Incr
eas
e 3
% Y
OY
De
cre
ase
5%
YO
Y
Arizona21%
California34%
Maryland8%
Nevada8%
Colorado5%
Texas14%
Virginia2%
Washington8%
Backlog Units – FY 2014 through FY 2016
13
1,032
1,1561,193
0
500
1,000
1,500
2014 2015 2016
Incr
eas
e 3
% Y
OY
Backlog UnitsFor the years ended December 31, 2014 through 2016
Backlog Units by StateFor the year ended December 31, 2016
Incr
eas
e 1
2%
YO
Y
$633K $603K $554KAverage Sales Price of Backlog Units
Arizona16%
California42%
Maryland6%
Nevada11%
Colorado3%
Texas10%
Virginia5%
Washington7%
New Home Deliveries – Q4 2016 Results
14
New Home Deliveries by StateFor the quarter ended December 31, 2016
New Home DeliveriesAs of and for the quarters ended December 31, 2015 and 2016
1,453 1,427
0
200
400
600
800
1,000
1,200
1,400
1,600
2015 2016
78% 83%Backlog Conversion Ratio
De
cre
ase
2%
YO
Y
Arizona15%
California40%
Maryland6%
Nevada11%
Colorado4%
Texas11%
Virginia4%
Washington9%
New Home Deliveries – FY 2014 through FY 2016
15
New Home Deliveries by StateFor the year ended December 31, 2016
New Home DeliveriesFor the years ended December 31, 2014 through 2016 and 2017 projections
3,100
4,0574,211
4,500
4,800
0
1,000
2,000
3,000
4,000
5,000
2014 2015 2016 2017P
Incr
eas
e 1
0%
YO
Y a
t m
idp
oin
t o
f th
e r
ange
Incr
eas
e 4
% Y
OY
Incr
eas
e 3
1%
YO
YGuidance Range of Deliveries
See Forward Looking Statement disclosure on page 2 of the presentation
Arizona12%
California47%
Maryland7%
Nevada9%
Colorado3%
Texas9%
Virginia5%
Washington8%
Home Sales Revenue – Q4 2016 Results
16
$847,409
$770,703
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
$900,000
$1,000,000
2015 2016
Home Sales RevenueFor the quarters ended December 31, 2015 and 2016 (dollars in thousands)
Home Sales Revenue by StateFor the quarter ended December 31, 2016
$583K $540KAverage Sales Price of Deliveries
De
cre
ase
9%
YO
Y
Arizona11%
California48%
Maryland6%
Nevada8%
Colorado4%
Texas10%
Virginia4%
Washington9%
Home Sales Revenue – FY 2014 through FY 2016
17
$1,646
$2,291 $2,329 $2,565
$2,736
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
2014 2015 2016 2017P
Incr
eas
e 1
4%
YO
Y a
t m
idp
oin
t o
f th
e r
ange
Home Sales RevenueFor the years ended December 31, 2014 through 2016 and 2017 projections(dollars in thousands)
Home Sales Revenue by StateFor the year ended December 31, 2016
$531K $565K $553K $570KAverage Sales Price of Deliveries
Incr
eas
e 2
% Y
OY
Incr
eas
e 3
9%
YO
Y
Guidance Range of
Home Sales Revenue
See Forward Looking Statement disclosure on page 2 of the presentation
SG&A Expenses, Income before Taxes and Net Income – Q4 2016 Results
18
$71,605 $70,937
$37,259 $37,282$34,346 $33,655
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
2015 2016
SG&A
S&M
G&A
Selling General and Administrative ExpensesFor the quarters ended December 31, 2015 and 2016 (dollars in thousands)
8.4% 9.2%SG&A as a % of Home Sales Revenue
De
cre
ase
1%
YO
Y
$131,344
$86,478$85,072
$57,861
$0.52
$0.36
$0.00
$0.10
$0.20
$0.30
$0.40
$0.50
$0.60
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
2015 2016
Inc Before Taxes Net Income EPS
Income before Taxes, Net Income available to Common Stockholders and EPS (Diluted)For the quarters ended December 31, 2015 and 2016 (dollars in thousands except EPS)
De
cre
ase
32
% Y
OY
De
cre
ase
34
% Y
OY
19
$185,958
$233,713
$251,093
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
2014 2015 2016 2017
Selling, General and Administrative ExpensesFor the years ended December 31, 2014 through 2016 (dollars in thousands)
11.3% 10.2% 10.8% 10.2%-10.4%SG&A as a % of Home Sales Revenue
Incr
eas
e 7
% Y
OY
Incr
eas
e 2
6%
YO
Y
2017 GuidanceProject SG&A Expense Ratio
of 10.2% to 10.4% of Home Sales Revenue
$127,964
$319,260$302,227
$84,197
$205,461$195,171
$0.58
$1.27$1.21
-$0.10
$0.10
$0.30
$0.50
$0.70
$0.90
$1.10
$1.30
$1.50
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
2014 2015 2016
Inc Before Taxes Net Income EPS
Income before Taxes, Net Income available to Common Stockholders and EPS (Diluted)For the full years ended December 31, 2014 through 2016 (dollars in thousands except EPS)
SG&A Expenses, Income before Taxes and Net Income – FY 2014 through FY 2016
Incr
eas
e 1
44
% Y
OY
Incr
eas
e 1
49
% Y
OY
De
cre
ase
5%
YO
Y
De
cre
ase
5%
YO
Y
See Forward Looking Statement disclosure on page 2 of the presentation
Orders, Deliveries and Absorption Rate year over year comparisons for the Fourth Quarter and Full Year 2016 by Segment
(Includes breakout by state for Pardee Homes and TRI Pointe Homes brands)
83
144
173
225
1.8
2.7
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
0
50
100
150
200
250
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
4Q15 4Q16$399K $417KAverage Sales Price of Deliveries
21
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
578
670
480
625
2.93.1
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
0
100
200
300
400
500
600
700
FY15 FY16Orders Deliveries Absorption
FY15 FY16$387K $408KAverage Sales Price of Deliveries
Incr
eas
e 3
0%
YO
Y
Incr
eas
e 7
3%
YO
Y
Incr
eas
e 3
0%
YO
Y
Incr
eas
e 1
6%
YO
Y
9499
136
165
2.9 2.9
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
0
20
40
60
80
100
120
140
160
180
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
Nevada
22
4Q15 4Q16$368K $433KAverage Sales Price of Deliveries
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
394
478
374
4603.2
3.6
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
100
200
300
400
500
600
FY15 FY16Orders Deliveries Absorption
FY15 FY16$368K $386KAverage Sales Price of Deliveries
Incr
eas
e 2
1%
YO
Y
Incr
eas
e 5
% Y
OY
Incr
eas
e 2
3%
YO
Y
Incr
eas
e 2
1%
YO
Y
138
171
270
2273.5
3.9
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
50
100
150
200
250
300
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
23
4Q15 4Q16$703K $492KAverage Sales Price of Deliveries
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
792728
756 760
5.24.8
0.0
1.0
2.0
3.0
4.0
5.0
6.0
0
100
200
300
400
500
600
700
800
900
FY15 FY16Orders Deliveries Absorption
FY15 FY16$620K $646K
Average Sales Price of Deliveries
California
Incr
eas
e 2
3%
YO
Y
De
cre
ase
16
% Y
OY
De
cre
ase
8%
YO
Y
Incr
eas
e 1
% Y
OY
88
67
114
96
2.8
3.4
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
20
40
60
80
100
120
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
24
4Q15 4Q16$475K $616KAverage Sales Price of Deliveries
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
441
341
4113833.4
3.6
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
50
100
150
200
250
300
350
400
450
500
FY15 FY16Orders Deliveries Absorption
FY15 FY16$440K $541KAverage Sales Price of Deliveries
De
cre
ase
24
% Y
OY
De
cre
ase
16
% Y
OY
De
cre
ase
23
% Y
OY
De
cre
ase
7%
YO
Y
76
116
145139
1.11.3
0.0
0.5
1.0
1.5
2.0
0
20
40
60
80
100
120
140
160
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
25
4Q15 4Q16$511K $506KAverage Sales Price of Deliveries
457
501539
474
1.5 1.5
0.0
0.5
1.0
1.5
2.0
2.5
0
100
200
300
400
500
600
FY15 FY16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
FY15 FY16$511K $506KAverage Sales Price of Deliveries
Incr
eas
e 5
3%
YO
Y
De
cre
ase
4%
YO
Y
Incr
eas
e 1
0%
YO
Y
De
cre
ase
12
% Y
OY
2528
65
42
1.5
2.1
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0
10
20
30
40
50
60
70
4Q15 4Q16
Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
26
4Q15 4Q16$512K $579KAverage Sales Price of Deliveries
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
193
135
193
1602.6
2.4
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0
20
40
60
80
100
120
140
160
180
200
FY15 FY16Orders Deliveries Absorption
FY15 FY16$496K $524K
Average Sales Price of Deliveries
Colorado
Inc
12
% Y
OY
De
c 3
5%
YO
Y
De
cre
ase
30
% Y
OY
De
cre
ase
17
% Y
OY
147
186
384 369
2.3
2.6
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
50
100
150
200
250
300
350
400
450
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
27
4Q15 4Q16$727K $668KAverage Sales Price of Deliveries
914962
867929
3.7 3.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
0
200
400
600
800
1,000
1,200
FY15 FY16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
FY15 FY16$782K $688KAverage Sales Price of Deliveries
California
Inc
27
% Y
OY
De
c 4
% Y
OY
Incr
eas
e 7
% Y
OY
Incr
eas
e 5
% Y
OY
102 98
166164
2.5 2.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0
20
40
60
80
100
120
140
160
180
4Q15 4Q16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the quarters ended December 31, 2015 and 2016
28
4Q15 4Q16$590K $570KAverage Sales Price of Deliveries
412433437
420
2.5
2.7
0.0
0.5
1.0
1.5
2.0
2.5
3.0
0
50
100
150
200
250
300
350
400
450
500
FY15 FY16Orders Deliveries Absorption
Orders, Deliveries and Absorption RateFor the years ended December 31, 2015 and 2016
FY15 FY16$616K $560KAverage Sales Price of Deliveries
De
cre
ase
4%
YO
Y
De
cre
ase
4%
YO
Y
Incr
eas
e 5
% Y
OY
De
cre
ase
1%
YO
Y
2017 Outlook
Full Year 2017 Update and Outlook
30
• Expect to grow average selling communities by 10% for the full year
• Anticipate delivering between 4,500 and 4,800 homes at an average sales price of $570,000
• Anticipate generating $45 million of gross profit from land and lot sales, most of which is expected to close in the third quarter of 2017
• Anticipate homebuilding gross margins for the full year in a range of 20% to 21%
• Anticipate SG&A expense ratio for the full year to be in a range of 10.2% to 10.4% of home sales revenue
See Forward Looking Statement disclosure on page 2 of the presentation
Land Supply
Orders by Month
Debt
Significant Land Supply to Fuel Growth
Combined Lot Position
Market Owned Controlled Total Lots % Owned Inventory Dollars LTM DeliveriesImplied Years of Supply (1)
California 16,835 410 17,245 98% $1,617,972 1,689 10.2
Colorado 621 297 918 68% $98,615 160 5.7
Washington, D.C. (2) 1,788 496 2,284 78% $282,545 420 5.4
Arizona 1,667 386 2,053 81% $228,965 625 3.3
Nevada 1,658 570 2,228 74% $250,109 460 4.8
Texas 1,687 312 1,999 84% $211,035 474 4.2
Washington 1,027 555 1,582 65% $221,386 383 4.1
Total 25,283 3,026 28,309 89% $2,910,627 4,211 6.7
As of December 31, 2016
California61%
Colorado3%
Washington, D.C. (2)8%
Arizona7%
Nevada8%
Texas7%
Washington6%
Total Lots
(1) Based on last twelve months’ deliveries as of December 31, 2016(2) Includes lots in the greater Washington D.C. area.
California56%
Colorado3%
Washington, D.C. (2)10%
Arizona8%
Nevada9%
Texas7%
Washington8%
Inventory Dollars
32
. Note: Dollars in thousands
New Home Orders – Historical by Month
33
324
415
455
410
457
371355
367
274
318
227208
322
409418
477
425
356
280
306
346 345
297
267
377
0
50
100
150
200
250
300
350
400
450
500
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2015
2016
2017
2017 - 3.03
2016 - 2.98 3.57 3.45 3.89 3.60 3.06 2.41 2.59 2.84 2.83 2.43 2.16
2015 - 2.96 3.67 3.91 3.47 3.82 3.05 2.91 3.02 2.29 2.72 1.98 1.92
Absorption Rate = Orders per Month per Community
January 2017
Orders up 17% YOY
4Q16 Orders up 21% YOY
Selected Balance Sheet Metrics
34
$450
$300
$450
$0
$100
$200
$300
$400
$500
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
4.375% Senior Notes 4.875% Senior Notes 5.875% Senior Notes
• During the fourth quarter, the Company had zero net borrowings under its $625 million unsecured revolving credit facility.
$ in thousands 12/31/2016 12/31/2015
Cash and cash equivalents $ 208,657 $ 214,485
Real estate inventories $ 2,910,627 $ 2,519,273
Total Debt $ 1,382,033 $ 1,170,505
Total Stockholders' equity $ 1,829,447 $ 1,664,683
Debt-to-capitalNet debt-to-capital(1)
43.0%39.1%
41.3%36.5%
Selected Balance Sheet Metrics
Senior Note Debt Maturities (in millions)
(1) See “Reconciliation of Non-GAAP Measures” in the appendix of this presentation
Supplemental Data and Reconciliation
Reconciliation of Non-GAAP Financial Measures(unaudited)
36
In this presentation, we utilize certain financial measures that are non-GAAP financial measures as defined by the Securities and Exchange Commission. We present these measures because we believe they and similar measures are useful to management and investors in evaluating the Company’s operating performance and financing structure. We also believe these measures facilitate the comparison of our operating performance and financing structure with other companies in our industry. Because these measures are not calculated inaccordance with Generally Accepted Accounting Principles (“GAAP”), they may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.
The following tables reconcile homebuilding gross margin percentage, as reported and prepared in accordance with GAAP, to the non-GAAP measure adjusted homebuilding gross margin percentage. We believe this information is meaningful as it isolates the impact that leverage has on homebuilding gross margin and permits investors to make better comparisons with our competitors, who adjust gross margins in a similar fashion.
Three Months Ended December 31,
2016 % 2015 %
(dollars in thousands)
Home sales revenue $ 770,703 100.0 % $ 847,409 100.0 %
Cost of home sales 616,767 80.0 % 659,585 77.8 %
Homebuilding gross margin 153,936 20.0 % 187,824 22.2 %
Add: interest in cost of home sales 16,458 2.1 % 16,759 2.0 %
Add: impairments and lot option abandonments 792 0.1 % 92 0.0 %
Adjusted homebuilding gross margin $ 171,186 22.2 % $ 204,675 24.2 %
Homebuilding gross margin percentage 20.0 % 22.2 %
Adjusted homebuilding gross margin percentage 22.2 % 24.2 %
Reconciliation of Non-GAAP Financial Measures(unaudited)
37
Year Ended December 31,
2016 % 2015 %
(dollars in thousands)
Home sales revenue $ 2,329,336 100.0 % $ 2,291,264 100.0 %
Cost of home sales 1,836,327 78.8 % 1,808,776 78.9 %
Homebuilding gross margin 493,009 21.2 % 482,488 21.1 %
Add: interest in cost of home sales 51,111 2.2 % 44,299 1.9 %
Add: impairments and lot option abandonments 1,470 0.1 % 1,685 0.1 %
Adjusted homebuilding gross margin $ 545,590 23.4 % $ 528,472 23.1 %
Homebuilding gross margin percentage 21.2 % 21.1 %
Adjusted homebuilding gross margin percentage 23.4 % 23.1 %
Reconciliation of Non-GAAP Financial Measures (cont’d)(unaudited)
38
The following table reconciles the Company’s ratio of debt-to-capital to the ratio of net debt-to-capital. We believe that the ratio of net debt-to-capital is a relevant financial measure for management and investors to understand the leverage employed in our operations and as an indicator of the Company’s ability to obtain financing.
December 31, 2016 December 31, 2015
Unsecured revolving credit facility $ 200,000 $ 299,392
Seller financed loans 13,726 2,434
Senior notes 1,168,307 868,679
Total debt 1,382,033 1,170,505
Stockholders’ equity 1,829,447 1,664,683
Total capital $ 3,211,480 $ 2,835,188
Ratio of debt-to-capital(1) 43.0 % 41.3 %
Total debt $ 1,382,033 $ 1,170,505
Less: Cash and cash equivalents (208,657 ) (214,485 )
Net debt 1,173,376 956,020
Stockholders’ equity 1,829,447 1,664,683
Total capital $ 3,002,823 $ 2,620,703
Ratio of net debt-to-capital(2) 39.1 % 36.5 %
__________ (1) The ratio of debt-to-capital is computed as the quotient obtained by dividing debt by the sum of debt plus equity.
(2) The ratio of net debt-to-capital is computed as the quotient obtained by dividing net debt (which is debt less cash and
cash equivalents) by the sum of net debt plus equity.