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Hovnanian Enterprises Reports Fiscal 2014 Second Quarter Results

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RED BANK, N.J., June 4, 2014 (GLOBE NEWSWIRE) -- Hovnanian Enterprises, Inc. (NYSE:HOV), a leading national homebuilder, reported results for its fiscal second quarter and six months ended April 30, 2014.

RESULTS FOR THE THREE AND SIX MONTH PERIODS ENDED APRIL 30, 2014:

  • Total revenues were $449.9 million for the second quarter ended April 30, 2014, an increase of 6.4% compared with $423.0 million in the fiscal 2013 second quarter. For the six months ended April 30, 2014, total revenues increased 4.2% to $814.0 million compared with $781.2 million in the first half of the prior year.
  • Homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, increased 130 basis points to 20.2% in the second quarter of fiscal 2014 compared with 18.9% in the fiscal 2013 second quarter. For the first six months of fiscal 2014, homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, was 19.5% compared with 18.0% in the first six months of the prior year.
  • Pre-tax loss, excluding land-related charges and loss on extinguishment of debt, for the second quarter ended April 30, 2014 was $5.6 million compared with pre-tax income of $0.9 million in last year's second quarter. During the first six months of fiscal 2014, the pre-tax loss, excluding land-related charges and loss on extinguishment of debt, was $28.8 million compared with a pre-tax loss of $19.2 million in the same period of the prior year.
  • Net loss was $7.9 million, or $0.05 per common share, for the three months ended April 30, 2014, compared with net income of $1.3 million, or $0.01 per common share, which included $2.6 million of federal and state tax benefits, during the same quarter a year ago. During the first six months of fiscal 2014, the net loss was $32.4 million, or $0.22 per common share, compared with a net loss of $10.0 million, or $0.07 per common share, which included $12.1 million of federal and state tax benefits, in last year's first six months.
  • Deliveries, including unconsolidated joint ventures, were 1,331 homes in the fiscal 2014 second quarter, a 6.5% decrease compared with 1,424 homes in the prior year's second quarter. For the six months ended April 30, 2014, deliveries, including unconsolidated joint ventures, were 2,469 homes compared with 2,612 homes in the first six months of fiscal 2013, a decrease of 5.5%.
  • The dollar value of consolidated net contracts increased 15.5% to $669.3 million for the second quarter of fiscal 2014 compared with $579.6 million for the same quarter a year ago. The dollar value of net contracts, including unconsolidated joint ventures, for the three months ended April 30, 2014 increased 1.0% to $703.0 million compared with $696.1 million in the second quarter of the prior year.
  • For the second quarter of fiscal 2014, the number of consolidated net contracts increased 6.7% to 1,809 homes compared with 1,695 homes in the second quarter of fiscal 2013. The number of net contracts, including unconsolidated joint ventures, decreased 2.2% to 1,907 homes in the second quarter of fiscal 2014 second quarter from 1,950 homes in the fiscal 2013 second quarter.
  • During the first half of fiscal 2014, the dollar value of consolidated net contracts increased 10.3% to $1,077.3 million compared with $976.5 million in the same period a year ago. The dollar value of net contracts, including unconsolidated joint ventures, for the first six months of fiscal 2014 was $1,158.8 million compared with $1,159.3 million in the first six months of the prior year.
  • In the first six months of fiscal 2014, the number of consolidated net contracts increased 0.4% to 2,901 homes from 2,890 homes in the first half of fiscal 2013. The number of net contracts, including unconsolidated joint ventures, decreased 5.6% to 3,109 homes for the six months ended April 30, 2014 from 3,294 homes in last year's first six months.
  • As of April 30, 2014, the dollar value of consolidated contract backlog increased 21.0% to $1,046.3 million compared with $865.0 million at April 30, 2013. The dollar value of contract backlog, as of April 30, 2014, including unconsolidated joint ventures, was $1,135.7 million, which was an increase of 10.9%, compared with $1,024.6 million as of April 30, 2013.
  • As of April 30, 2014, the number of homes in consolidated contract backlog increased 13.6% to 2,797 homes compared with 2,462 homes as of the end of the second quarter of fiscal 2013. Contract backlog, as of April 30, 2014, including unconsolidated joint ventures, increased of 7.3% to 3,032 homes compared with 2,827 homes as of April 30, 2013.
  • Total interest expense as a percentage of total revenues was 8.0% during both the second quarter of fiscal 2014 and the second quarter of fiscal 2013. For the six months ended April 30, 2014, total interest expense as a percentage of total revenues declined 30 basis points to 8.4% compared with 8.7% during the first six months a year ago.
  • Total SG&A was $62.4 million, or 13.9% of total revenues, during the fiscal 2014 second quarter compared to $51.5 million, or 12.2% of total revenues, in last year's second quarter. Total SG&A was $122.8 million, or 15.1% of total revenues, in the first six months of fiscal 2014 compared to $100.8 million, or 12.9% of total revenues, in the prior year's first six months.
  • Adjusted EBITDA decreased to $32.2 million for fiscal 2014 second quarter compared to $37.1 million during the second quarter of fiscal 2013. Adjusted EBITDA decreased to $43.7 million for the six months ended April 30, 2014 compared to $53.6 million in the first six months of fiscal 2013.
  • The contract cancellation rate, including unconsolidated joint ventures, for the three months ended April 30, 2014 was 17%, compared with 16% in the second quarter of the prior year.
  • The valuation allowance was $936.3 million as of April 30, 2014. The valuation allowance is a non-cash reserve against the tax assets for GAAP purposes. For tax purposes, the tax deductions associated with the tax assets may be carried forward for 20 years from the date the deductions were incurred.

LIQUIDITY AND INVENTORY AS OF APRIL 30, 2014:

  • During the second quarter of fiscal 2014, $105.3 million was spent on land and land development. For the six months ended April 30, 2014, the dollar amount spent on land and land development was $287.0 million.
  • Homebuilding cash was $243.3 million as of April 30, 2014, including $5.2 million of restricted cash required to collateralize letters of credit, compared to $263.4 million at April 30, 2013. In addition to homebuilding cash, there was $55.0 million of availability under the revolving credit facility as of April 30, 2014, bringing total liquidity to $298.3 million. Total liquidity increased 13.2% from $263.4 million at April 30, 2013.
  • As of April 30, 2014, the land position, including unconsolidated joint ventures, was 37,787 lots, consisting of 17,714 lots under option and 20,073 owned lots, an increase of 7,744 lots compared with a total of 30,043 lots as of April 30, 2013.
  • During the second quarter of fiscal 2014, approximately 5,600 lots were put under option or acquired in 56 communities.

COMMENTS FROM MANAGEMENT:

"We launched our national sales campaign, Big Deal Days, in March and were encouraged by the 728 net contracts signed during the month of March 2014, the highest level of monthly net contracts since April 2008. In addition, the 3.6 net contracts per active selling community in March was the highest level of monthly net contracts per community since September 2007," stated Ara K. Hovnanian, Chairman of the Board, President and Chief Executive Officer. "However, our sales pace during April and May was choppy and the total monthly sales pace per active selling community in both months fell short of last year's levels."

"We were pleased with the revenue growth, as well as improvements in our gross margin, that we reported for the second quarter of fiscal 2014," stated J. Larry Sorsby, Chief Financial Officer and Executive Vice President. "In order to drive future revenue growth, we have invested in growing our community count. The related general and administrative costs to support these new community openings are hitting our SG&A costs today even though those communities are not yet delivering homes. As a result, our ratio of SG&A to total revenues is higher than normal. As we generate revenues from our increased community count, we will be able to leverage our total SG&A expenses and over time should return to a normalized SG&A ratio of approximately 10%," stated Mr. Sorsby.

"Net contracts from our consolidated communities increased 7% for the second quarter. Given the increases in our consolidated net contracts, community count and backlog, we currently anticipate continued growth in revenues resulting in profitability during the second half of fiscal 2014. We expect to be profitable for all of fiscal 2014, but our profitability is expected to be more back-end weighted than it was in fiscal 2013. Ultimately, positive demographics will be the primary driver of the housing industry. Based on the current low level of national housing starts, we still firmly believe that we are in the early stages of a housing recovery," concluded Mr. Hovnanian.

WEBCAST INFORMATION:

Hovnanian Enterprises will webcast its fiscal 2014 second quarter financial results conference call at 11:00 a.m. E.T. on Wednesday, June 4, 2014. The webcast can be accessed live through the "Investor Relations" section of Hovnanian Enterprises' Website at http://www.khov.com. For those who are not available to listen to the live webcast, an archive of the broadcast will be available under the "Audio Archives" section of the Investor Relations page on the Hovnanian Website at http://www.khov.com. The archive will be available for 12 months.

ABOUT HOVNANIAN ENTERPRISES®, INC.:

Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, Minnesota, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian® Homes®, Brighton Homes®, Parkwood Builders, Town & Country Homes and Oster Homes. As the developer of K. Hovnanian's® Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes.

Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company's 2013 annual report, can be accessed through the "Investor Relations" section of the Hovnanian Enterprises' website at http://www.khov.com. To be added to Hovnanian's investor e-mail or fax lists, please send an e-mail to IR@khov.com or sign up at http://www.khov.com.

NON-GAAP FINANCIAL MEASURES:

Consolidated earnings before interest expense and income taxes ("EBIT") and before depreciation and amortization ("EBITDA") and before inventory impairment loss and land option write-offs and loss on extinguishment of debt ("Adjusted EBITDA") are not U.S. generally accepted accounting principles (GAAP) financial measures. The most directly comparable GAAP financial measure is net (loss) income. The reconciliation of EBIT, EBITDA and Adjusted EBITDA to net (loss) income is presented in a table attached to this earnings release.

(Loss) Income Before Income Taxes Excluding Land-Related Charges and Loss on Extinguishment of Debt is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Loss Before Income Taxes. The reconciliation of (Loss) Income Before Income Taxes Excluding Land-Related Charges and Loss on Extinguishment of Debt to Loss Before Income Taxes is presented in a table attached to this earnings release.

FORWARD-LOOKING STATEMENTS

All statements in this press release that are not historical facts should be considered as "forward-looking statements." Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Although we believe that our plans, intentions and expectations reflected in, or suggested by, such forward looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic, industry and business conditions and impacts of the sustained homebuilding downturn, (2) adverse weather and other environmental conditions and natural disasters, (3) changes in market conditions and seasonality of the Company's business, (4) changes in home prices and sales activity in the markets where the Company builds homes, (5) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, tax laws, and the environment, (6) fluctuations in interest rates and the availability of mortgage financing, (7) shortages in, and price fluctuations of, raw materials and labor, (8) the availability and cost of suitable land and improved lots, (9) levels of competition, (10) availability of financing to the Company, (11) utility shortages and outages or rate fluctuations, (12) levels of indebtedness and restrictions on the Company's operations and activities imposed by the agreements governing the Company's outstanding indebtedness, (13) the Company's sources of liquidity, (14) changes in credit ratings, (15) availability of net operating loss carryforwards, (16) operations through joint ventures with third parties, (17) product liability litigation, warranty claims and claims made by mortgage investors, (18) successful identification and integration of acquisitions, (19) significant influence of the Company's controlling stockholders, (20) changes in tax laws affecting the after-tax costs of owning a home, (21) geopolitical risks, terrorist acts and other acts of war, and (22) other factors described in detail in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2013 and subsequent filings with the Securities and Exchange Commission. Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

Hovnanian Enterprises, Inc.
April 30, 2014
Statements of Consolidated Operations
(Dollars in Thousands, Except Per Share Data)
Three Months Ended Six Months Ended
April 30, April 30,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Total Revenues $449,929 $422,998 $813,977 $781,209
Costs and Expenses (a) 457,139 425,090 847,648 806,392
Loss on Extinguishment of Debt (1,155) -- (1,155) --
Income from Unconsolidated Joint Ventures 1,067 827 3,638 3,116
Loss Before Income Taxes (7,298) (1,265) (31,188) (22,067)
Income Tax Provision (Benefit) 604 (2,583) 1,237 (12,077)
Net (Loss) Income $(7,902) $1,318 $(32,425) $(9,990)
Per Share Data:
Basic:
(Loss) Income Per Common Share $(0.05) $0.01 $(0.22) $(0.07)
Weighted Average Number of
Common Shares Outstanding (b) 146,325 145,948 146,151 144,373
Assuming Dilution:
(Loss) Income Per Common Share $(0.05) $0.01 $(0.22) $(0.07)
Weighted Average Number of
Common Shares Outstanding (b) 146,325 147,231 146,151 144,373
(a) Includes inventory impairment loss and land option write-offs.
(b) For periods with a net loss, basic shares are used in accordance with GAAP rules.
Hovnanian Enterprises, Inc.
April 30, 2014
Reconciliation of (Loss) Income Before Income Taxes Excluding Land-Related Charges and
Loss on Extinguishment of Debt to Loss Before Income Taxes
(Dollars in Thousands)
Three Months Ended Six Months Ended
April 30, April 30,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Loss Before Income Taxes $(7,298) $(1,265) $(31,188) $(22,067)
Inventory Impairment Loss and Land Option Write-Offs 522 2,191 1,186 2,856
Loss on Extinguishment of Debt 1,155 -- 1,155 --
(Loss) Income Before Income Taxes Excluding Land-Related
Charges and Loss on Extinguishment of Debt (a) $(5,621) $926 $(28,847) $(19,211)
(a) (Loss) Income Before Income Taxes Excluding Land-Related Charges and Loss on Extinguishment of Debt is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Loss Before Income Taxes.
Hovnanian Enterprises, Inc.
April 30, 2014
Gross Margin
(Dollars in Thousands)
Homebuilding Gross Margin Homebuilding Gross Margin
Three Months Ended Six Months Ended
April 30, April 30,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Sale of Homes $438,302 $409,576 $793,483 $743,857
Cost of Sales, Excluding Interest (a) 349,867 332,134 638,392 609,692
Homebuilding Gross Margin, Excluding Interest 88,435 77,442 155,091 134,165
Homebuilding Cost of Sales Interest 12,024 11,227 21,490 21,387
Homebuilding Gross Margin, Including Interest $76,411 $66,215 $133,601 $112,778
Gross Margin Percentage, Excluding Interest 20.2% 18.9% 19.5% 18.0%
Gross Margin Percentage, Including Interest 17.4% 16.2% 16.8% 15.2%
Land and Lot Sales Land and Lot Sales
Gross Margin Gross Margin
Three Months Ended Six Months Ended
April 30, April 30,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Land and Lot Sales $1,499 $1,451 $1,929 $13,278
Cost of Sales, Excluding Interest (a) 566 1,009 928 12,206
Land and Lot Sales Gross Margin, Excluding Interest 933 442 1,001 1,072
Land and Lot Sales Interest 383 47 407 167
Land and Lot Sales Gross Margin, Including Interest $550 $395 $594 $905
(a) Does not include cost associated with walking away from land options or inventory impairment losses which are recorded as Inventory impairment loss and land option write-offs in the Condensed Consolidated Statements of Operations.
Hovnanian Enterprises, Inc.
April 30, 2014
Reconciliation of Adjusted EBITDA to Net (Loss) Income
(Dollars in Thousands)
Three Months Ended Six Months Ended
April 30, April 30,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Net (Loss) Income $(7,902) $1,318 $(32,425) $(9,990)
Income Tax Provision (Benefit) 604 (2,583) 1,237 (12,077)
Interest Expense 35,879 33,906 68,702 68,186
EBIT (a) 28,581 32,641 37,514 46,119
Depreciation 853 1,382 1,706 2,844
Amortization of Debt Costs 1,103 907 2,158 1,811
EBITDA (b) 30,537 34,930 41,378 50,774
Inventory Impairment Loss and Land Option Write-offs 522 2,191 1,186 2,856
Loss on Extinguishment of Debt 1,155 -- 1,155 --
Adjusted EBITDA (c) $32,214 $37,121 $43,719 $53,630
Interest Incurred $36,782 $31,965 $71,601 $64,618
Adjusted EBITDA to Interest Incurred 0.88 1.16 0.61 0.83
(a) EBIT is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net (loss) income. EBIT represents earnings before interest expense and income taxes.
(b) EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net (loss) income. EBITDA represents earnings before interest expense, income taxes, depreciation and amortization.
(c) Adjusted EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net (loss) income. Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation, amortization and inventory impairment loss and land option write-offs and loss on extinguishment of debt.
Hovnanian Enterprises, Inc.
April 30, 2014
Interest Incurred, Expensed and Capitalized
(Dollars in Thousands)
Three Months Ended Six Months Ended
April 30, April 30,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Interest Capitalized at Beginning of Period $107,089 $114,429 $105,093 $116,056
Plus Interest Incurred 36,782 31,965 71,601 64,618
Less Interest Expensed 35,879 33,906 68,702 68,186
Interest Capitalized at End of Period (a) $107,992 $112,488 $107,992 $112,488
(a) Capitalized interest amounts are shown gross before allocating any portion of impairments to capitalized interest.
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands)
April 30, October 31,
2014 2013
(Unaudited) (1)
ASSETS
Homebuilding:
Cash $238,116 $319,142
Restricted cash and cash equivalents 11,392 10,286
Inventories:
Sold and unsold homes and lots under development 950,978 752,749
Land and land options held for future development or sale 236,714 225,152
Consolidated inventory not owned:
Specific performance options 2,168 792
Other options 105,796 100,071
Total consolidated inventory not owned 107,964 100,863
Total inventories 1,295,656 1,078,764
Investments in and advances to unconsolidated joint ventures 47,665 51,438
Receivables, deposits, and notes – net 52,772 45,085
Property, plant, and equipment – net 45,884 46,211
Prepaid expenses and other assets 62,656 59,351
Total homebuilding 1,754,141 1,610,277
Financial services:
Cash 7,116 10,062
Restricted cash and cash equivalents 17,306 21,557
Mortgage loans held for sale at fair value 58,019 112,953
Other assets 2,241 4,281
Total financial services 84,682 148,853
Total assets $1,838,823 $1,759,130
(1) Derived from the audited balance sheet as of October 31, 2013.
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share and Per Share Amounts)
April 30, October 31,
2014 2013
(Unaudited) (1)
LIABILITIES AND EQUITY
Homebuilding:
Nonrecourse mortgages $92,879 $62,903
Accounts payable and other liabilities 303,332 307,764
Customers' deposits 38,281 30,119
Nonrecourse mortgages secured by operating properties 17,185 17,733
Liabilities from inventory not owned 94,923 87,866
Total homebuilding 546,600 506,385
Financial services:
Accounts payable and other liabilities 27,018 32,874
Mortgage warehouse lines of credit 35,308 91,663
Total financial services 62,326 124,537
Notes payable:
Senior secured notes 979,262 978,611
Senior notes 590,113 461,210
Senior amortizing notes 19,004 20,857
Senior exchangeable notes 68,336 66,615
TEU senior subordinated amortizing notes -- 2,152
Accrued interest 32,272 28,261
Total notes payable 1,688,987 1,557,706
Income taxes payable 3,423 3,301
Total liabilities 2,301,336 2,191,929
Equity:
Hovnanian Enterprises, Inc. stockholders' equity deficit:
Preferred stock, $0.01 par value - authorized 100,000 shares; issued and outstanding 5,600 shares with a liquidation preference of $140,000 at April 30, 2014 and at October 31, 2013 135,299 135,299
Common stock, Class A, $0.01 par value – authorized 400,000,000 shares; issued 142,746,950 shares at April 30, 2014 and 136,306,223 shares at October 31, 2013 (including 11,760,763 shares at April 30, 2014 and October 31, 2013 held in Treasury) 1,427 1,363
Common stock, Class B, $0.01 par value (convertible to Class A at time of sale) – authorized 60,000,000 shares; issued 15,496,689 shares at April 30, 2014 and 15,347,615 shares at October 31, 2013 (including 691,748 shares at April 30, 2014 and October 31, 2013 held in Treasury) 155 153
Paid in capital – common stock 692,352 689,727
Accumulated deficit (1,176,833) (1,144,408)
Treasury stock – at cost (115,360) (115,360)
Total Hovnanian Enterprises, Inc. stockholders' equity deficit (462,960) (433,226)
Noncontrolling interest in consolidated joint ventures 447 427
Total equity deficit (462,513) (432,799)
Total liabilities and equity $1,838,823 $1,759,130
(1) Derived from the audited balance sheet as of October 31, 2013.
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Per Share Data)
(Unaudited)
Three Months Ended April 30, Six Months Ended April 30,
2014 2013 2014 2013
Revenues:
Homebuilding:
Sale of homes $438,302 $409,576 $793,483 $743,857
Land sales and other revenues 2,215 2,740 2,988 15,011
Total homebuilding 440,517 412,316 796,471 758,868
Financial services 9,412 10,682 17,506 22,341
Total revenues 449,929 422,998 813,977 781,209
Expenses:
Homebuilding:
Cost of sales, excluding interest 350,433 333,143 639,320 621,898
Cost of sales interest 12,407 11,274 21,897 21,554
Inventory impairment loss and land option write-offs 522 2,191 1,186 2,856
Total cost of sales 363,362 346,608 662,403 646,308
Selling, general and administrative 47,806 37,802 91,768 74,573
Total homebuilding expenses 411,168 384,410 754,171 720,881
Financial services 6,707 7,137 13,379 14,565
Corporate general and administrative 14,641 13,725 31,033 26,228
Other interest 23,472 22,632 46,805 46,632
Other operations 1,151 (2,814) 2,260 (1,914)
Total expenses 457,139 425,090 847,648 806,392
Loss on extinguishment of debt (1,155) -- (1,155) --
Income from unconsolidated joint ventures 1,067 827 3,638 3,116
Loss before income taxes (7,298) (1,265) (31,188) (22,067)
State and federal income tax provision (benefit):
State 604 (2,432) 1,237 (2,199)
Federal -- (151) -- (9,878)
Total income taxes 604 (2,583) 1,237 (12,077)
Net (loss) income $(7,902) $1,318 $(32,425) $(9,990)
Per share data:
Basic:
(Loss) income per common share $(0.05) $0.01 $(0.22) $(0.07)
Weighted-average number of common shares outstanding 146,325 145,948 146,151 144,373
Assuming dilution:
(Loss) income per common share $(0.05) $0.01 $(0.22) $(0.07)
Weighted-average number of common shares outstanding 146,325 147,231 146,151 144,373
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED) Communities Under Development
Three Months - April 30, 2014
Net Contracts Deliveries Contract
Three Months Ended Three Months Ended Backlog
Apr 30, Apr 30, Apr 30,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(NJ, PA) Home 156 183 (14.8)% 134 113 18.6% 237 315 (24.8)%
Dollars $75,485 $86,311 (12.5)% $65,550 $53,100 23.4% $113,846 $139,750 (18.5)%
Avg. Price $483,878 $471,647 2.6% $489,180 $469,907 4.1% $480,363 $443,652 8.3%
Mid-Atlantic
(DE, MD, VA, WV) Home 263 181 45.3% 145 135 7.4% 404 341 18.5%
Dollars $119,935 $89,896 33.4% $68,431 $57,706 18.6% $203,218 $168,438 20.6%
Avg. Price $456,027 $496,664 (8.2)% $471,938 $427,450 10.4% $503,015 $493,954 1.8%
Midwest
(IL, MN, OH) Home 229 247 (7.3)% 167 159 5.0% 666 530 25.7%
Dollars $65,242 $60,898 7.1% $48,624 $39,356 23.5% $171,987 $125,073 37.5%
Avg. Price $284,901 $246,549 15.6% $291,162 $247,522 17.6% $258,239 $235,987 9.4%
Southeast
(FL, GA, NC, SC) Home 183 184 (0.5)% 164 135 21.5% 308 295 4.4%
Dollars $59,467 $51,479 15.5% $50,792 $37,119 36.8% $102,421 $81,715 25.3%
Avg. Price $324,956 $279,777 16.1% $309,707 $274,952 12.6% $332,537 $277,001 20.0%
Southwest
(AZ, TX) Home 839 779 7.7% 551 571 (3.5)% 1,027 825 24.5%
Dollars $269,985 $235,517 14.6% $164,212 $160,988 2.0% $352,139 $273,910 28.6%
Avg. Price $321,794 $302,332 6.4% $298,025 $281,941 5.7% $342,881 $332,011 3.3%
West
(CA) Home 139 121 14.9% 74 142 (47.9)% 155 156 (0.6)%
Dollars $79,167 $55,461 42.7% $40,693 $61,308 (33.6)% $102,644 $76,082 34.9%
Avg. Price $569,545 $458,359 24.3% $549,905 $431,749 27.4% $662,221 $487,707 35.8%
Consolidated Total
Home 1,809 1,695 6.7% 1,235 1,255 (1.6)% 2,797 2,462 13.6%
Dollars $669,281 $579,562 15.5% $438,302 $409,577 7.0% $1,046,255 $864,968 21.0%
Avg. Price $369,973 $341,925 8.2% $354,900 $326,356 8.7% $374,063 $351,328 6.5%
Unconsolidated Joint Ventures
Home 98 255 (61.6)% 96 169 (43.2)% 235 365 (35.6)%
Dollars $33,768 $116,572 (71.0)% $33,411 $74,119 (54.9)% $89,485 $159,583 (43.9)%
Avg. Price $344,567 $457,144 (24.6)% $348,031 $438,576 (20.6)% $380,787 $437,213 (12.9)%
Grand Total
Home 1,907 1,950 (2.2)% 1,331 1,424 (6.5)% 3,032 2,827 7.3%
Dollars $703,049 $696,134 1.0% $471,713 $483,696 (2.5)% $1,135,740 $1,024,551 10.9%
Avg. Price $368,668 $356,992 3.3% $354,405 $339,674 4.3% $374,584 $362,416 3.4%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.
(2) Segment data excludes unconsolidated joint ventures.
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED) Communities Under Development
Six Months - April 30, 2014
Net Contracts Deliveries Contract
Six Months Ended Six Months Ended Backlog
Apr 30, Apr 30, Apr 30,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(NJ, PA) Home 257 288 (10.8)% 240 237 1.3% 237 315 (24.8)%
Dollars $127,523 $131,667 (3.1)% $118,683 $107,333 10.6% $113,846 $139,750 (18.5)%
Avg. Price $496,200 $457,179 8.5% $494,512 $452,884 9.2% $480,363 $443,652 8.3%
Mid-Atlantic
(DE, MD, VA, WV) Home 403 327 23.2% 270 252 7.1% 404 341 18.5%
Dollars $190,832 $159,818 19.4% $128,781 $110,152 16.9% $203,218 $168,438 20.6%
Avg. Price $473,530 $488,739 (3.1)% $476,966 $437,113 9.1% $503,015 $493,954 1.8%
Midwest
(IL, MN, OH) Home 397 400 (0.8)% 336 297 13.1% 666 530 25.7%
Dollars $113,633 $100,885 12.6% $92,363 $71,528 29.1% $171,987 $125,073 37.5%
Avg. Price $286,230 $252,213 13.5% $274,889 $240,834 14.1% $258,239 $235,987 9.4%
Southeast
(FL, GA, NC, SC) Home 295 304 (3.0)% 295 244 20.9% 308 295 4.4%
Dollars $93,685 $84,743 10.6% $89,920 $65,723 36.8% $102,421 $81,715 25.3%
Avg. Price $317,576 $278,758 13.9% $304,813 $269,357 13.2% $332,537 $277,001 20.0%
Southwest
(AZ, TX) Home 1,342 1,338 0.3% 992 1,019 (2.6)% 1,027 825 24.5%
Dollars $428,069 $394,786 8.4% $292,297 $281,717 3.8% $352,139 $273,910 28.6%
Avg. Price $318,978 $295,057 8.1% $294,655 $276,464 6.6% $342,881 $332,011 3.3%
West
(CA) Home 207 233 (11.2)% 138 268 (48.5)% 155 156 (0.6)%
Dollars $123,557 $104,609 18.1% $71,439 $107,404 (33.5)% $102,644 $76,082 34.9%
Avg. Price $596,892 $448,966 32.9% $517,672 $400,761 29.2% $662,221 $487,707 35.8%
Consolidated Total
Home 2,901 2,890 0.4% 2,271 2,317 (2.0)% 2,797 2,462 13.6%
Dollars $1,077,299 $976,508 10.3% $793,483 $743,857 6.7% $1,046,255 $864,968 21.0%
Avg. Price $371,354 $337,892 9.9% $349,398 $321,043 8.8% $374,063 $351,328 6.5%
Unconsolidated Joint Ventures
Home 208 404 (48.5)% 198 295 (32.9)% 235 365 (35.6)%
Dollars $81,536 $182,790 (55.4)% $77,987 $133,113 (41.4)% $89,485 $159,583 (43.9)%
Avg. Price $391,998 $452,451 (13.4)% $393,875 $451,230 (12.7)% $380,787 $437,213 (12.9)%
Grand Total
Home 3,109 3,294 (5.6)% 2,469 2,612 (5.5)% 3,032 2,827 7.3%
Dollars $1,158,835 $1,159,298 (0.0)% $871,470 $876,970 (0.6)% $1,135,740 $1,024,551 10.9%
Avg. Price $372,735 $351,942 5.9% $352,965 $335,747 5.1% $374,584 $362,416 3.4%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.
(2) Segment data excludes unconsolidated joint ventures.
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED) Communities Under Development
Three Months - April 30, 2014
Net Contracts Deliveries Contract
Three Months Ended Three Months Ended Backlog
Apr 30, Apr 30, Apr 30,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(includes unconsolidated joint ventures) Home 167 226 (26.1)% 147 134 9.7% 261 364 (28.3)%
(NJ, PA) Dollars $75,796 $119,447 (36.5)% $69,985 $70,314 (0.5)% $122,405 $178,476 (31.4)%
Avg. Price $453,868 $528,527 (14.1)% $476,088 $524,732 (9.3)% $468,985 $490,318 (4.4)%
Mid-Atlantic
(includes unconsolidated joint ventures) Home 301 291 3.4% 180 219 (17.8)% 489 481 1.7%
(DE, MD, VA, WV) Dollars $136,640 $139,068 (1.7)% $82,620 $92,928 (11.1)% $244,103 $231,927 5.3%
Avg. Price $453,953 $477,896 (5.0)% $459,000 $424,329 8.2% $499,188 $482,176 3.5%
Midwest
(includes unconsolidated joint ventures) Home 247 288 (14.2)% 181 188 (3.7)% 706 617 14.4%
(IL, MN, OH) Dollars $70,073 $73,032 (4.1)% $52,327 $47,566 10.0% $182,927 $150,065 21.9%
Avg. Price $283,694 $253,584 11.9% $289,100 $253,008 14.3% $259,103 $243,217 6.5%
Southeast
(includes unconsolidated joint ventures) Home 214 231 (7.4)% 198 159 24.5% 394 372 5.9%
(FL, GA, NC, SC) Dollars $71,388 $65,545 8.9% $61,876 $44,832 38.0% $131,522 $107,165 22.7%
Avg. Price $333,589 $283,746 17.6% $312,506 $281,965 10.8% $333,812 $288,079 15.9%
Southwest
(includes unconsolidated joint ventures) Home 839 779 7.7% 551 571 (3.5)% 1,027 825 24.5%
(AZ, TX) Dollars $269,985 $235,517 14.6% $164,212 $160,988 2.0% $352,139 $273,910 28.6%
Avg. Price $321,794 $302,332 6.4% $298,025 $281,941 5.7% $342,881 $332,011 3.3%
West
(includes unconsolidated joint ventures) Home 139 135 3.0% 74 153 (51.6)% 155 168 (7.7)%
(CA) Dollars $79,167 $63,525 24.6% $40,693 $67,068 (39.3)% $102,644 $83,008 23.7%
Avg. Price $569,545 $470,556 21.0% $549,905 $438,351 25.4% $662,221 $494,097 34.0%
Grand Total
Home 1,907 1,950 (2.2)% 1,331 1,424 (6.5)% 3,032 2,827 7.3%
Dollars $703,049 $696,134 1.0% $471,713 $483,696 (2.5)% $1,135,740 $1,024,551 10.9%
Avg. Price $368,668 $356,992 3.3% $354,405 $339,674 4.3% $374,584 $362,416 3.4%
Consolidated Total
Home 1,809 1,695 6.7% 1,235 1,255 (1.6)% 2,797 2,462 13.6%
Dollars $669,281 $579,562 15.5% $438,302 $409,577 7.0% $1,046,255 $864,968 21.0%
Avg. Price $369,973 $341,925 8.2% $354,900 $326,356 8.7% $374,063 $351,328 6.5%
Unconsolidated Joint Ventures
Home 98 255 (61.6)% 96 169 (43.2)% 235 365 (35.6)%
Dollars $33,768 $116,572 (71.0)% $33,411 $74,119 (54.9)% $89,485 $159,583 (43.9)%
Avg. Price $344,567 $457,144 (24.6)% $348,031 $438,576 (20.6)% $380,787 $437,213 (12.9)%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED) Communities Under Development
Six Months - April 30, 2014
Net Contracts Deliveries Contract
Six Months Ended Six Months Ended Backlog
Apr 30, Apr 30, Apr 30,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(includes unconsolidated joint ventures) Home 295 349 (15.5)% 267 279 (4.3)% 261 364 (28.3)%
(NJ, PA) Dollars $143,165 $180,198 (20.6)% $132,008 $142,674 (7.5)% $122,405 $178,476 (31.4)%
Avg. Price $485,305 $516,327 (6.0)% $494,411 $511,376 (3.3)% $468,985 $490,318 (4.4)%
Mid-Atlantic
(includes unconsolidated joint ventures) Home 494 505 (2.2)% 346 390 (11.3)% 489 481 1.7%
(DE, MD, VA, WV) Dollars $230,084 $238,099 (3.4)% $161,372 $169,370 (4.7)% $244,103 $231,927 5.3%
Avg. Price $465,756 $471,483 (1.2)% $466,393 $434,283 7.4% $499,188 $482,176 3.5%
Midwest
(includes unconsolidated joint ventures) Home 422 472 (10.6)% 370 354 4.5% 706 617 14.4%
(IL, MN, OH) Dollars $120,504 $121,852 (1.1)% $101,510 $87,706 15.7% $182,927 $150,065 21.9%
Avg. Price $285,555 $258,161 10.6% $274,352 $247,756 10.7% $259,103 $243,217 6.5%
Southeast
(includes unconsolidated joint ventures) Home 348 373 (6.7)% 347 284 22.2% 394 372 5.9%
(FL, GA, NC, SC) Dollars $112,764 $106,544 5.8% $106,975 $78,719 35.9% $131,522 $107,165 22.7%
Avg. Price $324,033 $285,641 13.4% $308,286 $277,179 11.2% $333,812 $288,079 15.9%
Southwest
(includes unconsolidated joint ventures) Home 1,342 1,338 0.3% 992 1,019 (2.6)% 1,027 825 24.5%
(AZ, TX) Dollars $428,069 $394,786 8.4% $292,297 $281,717 3.8% $352,139 $273,910 28.6%
Avg. Price $318,978 $295,057 8.1% $294,655 $276,464 6.6% $342,881 $332,011 3.3%
West
(includes unconsolidated joint ventures) Home 208 257 (19.1)% 147 286 (48.6)% 155 168 (7.7)%
(CA) Dollars $124,249 $117,819 5.5% $77,308 $116,784 (33.8)% $102,644 $83,008 23.7%
Avg. Price $597,351 $458,441 30.3% $525,907 $408,335 28.8% $662,221 $494,097 34.0%
Grand Total
Home 3,109 3,294 (5.6)% 2,469 2,612 (5.5)% 3,032 2,827 7.3%
Dollars $1,158,835 $1,159,298 (0.0)% $871,470 $876,970 (0.6)% $1,135,740 $1,024,551 10.9%
Avg. Price $372,735 $351,942 5.9% $352,965 $335,747 5.1% $374,584 $362,416 3.4%
Consolidated Total
Home 2,901 2,890 0.4% 2,271 2,317 (2.0)% 2,797 2,462 13.6%
Dollars $1,077,299 $976,508 10.3% $793,483 $743,857 6.7% $1,046,255 $864,968 21.0%
Avg. Price $371,354 $337,892 9.9% $349,398 $321,043 8.8% $374,063 $351,328 6.5%
Unconsolidated Joint Ventures
Home 208 404 (48.5)% 198 295 (32.9)% 235 365 (35.6)%
Dollars $81,536 $182,790 (55.4)% $77,987 $133,113 (41.4)% $89,485 $159,583 (43.9)%
Avg. Price $391,998 $452,451 (13.4)% $393,875 $451,230 (12.7)% $380,787 $437,213 (12.9)%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.

CONTACT: J. Larry Sorsby Executive Vice President & CFO 732-747-7800 Jeffrey T. O'Keefe Vice President, Investor Relations 732-747-7800

Source:Hovnanian Enterprises, Inc.