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Hovnanian Enterprises Reports Fiscal 2014 Results

RED BANK, N.J., Dec. 10, 2014 (GLOBE NEWSWIRE) -- Hovnanian Enterprises, Inc. (NYSE:HOV), a leading national homebuilder, reported results for its fiscal fourth quarter and full year ended October 31, 2014.

RESULTS FOR THE THREE AND TWELVE MONTH PERIODS ENDED OCTOBER 31, 2014:

  • Total revenues were $698.4 million for the fiscal 2014 fourth quarter, an increase of 18.0% compared with $591.7 million during the fourth quarter of fiscal 2013. For the fiscal year ended October 31, 2014, total revenues increased 11.4% to $2.06 billion compared with $1.85 billion for the 2013 fiscal year.
  • Homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, was 19.3% for the three months ended October 31, 2014, compared with 22.6% in the fourth quarter of the previous year. For all of fiscal 2014, homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, was 19.9% compared with 20.1% for the full 2013 fiscal year.
  • Pre-tax income during the fourth quarter of fiscal 2014 was $36.0 million compared with pre-tax income of $33.6 million in the fourth quarter of the prior year. For the fiscal year ended October 31, 2014, pre-tax income was $20.2 million compared with pre-tax income of $21.9 million for last year's full year.
  • A non-cash tax benefit of $285.1 million from the reduction of the Company's valuation allowance for its deferred tax assets was included in net income for both the fourth quarter and year ended October 31, 2014.
  • Net income was $322.5 million, or $1.95 per fully diluted common share, during the fourth quarter of fiscal 2014, compared with net income of $32.8 million, or $0.21 per fully diluted common share in the same period of the previous year. For the year ended October 31, 2014, net income was $307.1 million, or $1.87 per fully diluted common share, compared with net income of $31.3 million, or $0.22 per fully diluted common share during the same period a year ago.
  • Deliveries, including unconsolidated joint ventures, were 1,916 homes during the fiscal 2014 fourth quarter, a 5.5% increase compared with 1,816 homes in last year's fourth quarter. For all of fiscal 2014, deliveries, including unconsolidated joint ventures, were 5,934 homes compared with 5,930 homes in the prior fiscal year.
  • As of October 31, 2014, consolidated active selling communities increased 4.7% to 201 communities compared with 192 communities at October 31, 2013.
  • The dollar value of consolidated net contracts increased 15.4% to $511.8 million for the fiscal 2014 fourth quarter compared with $443.3 million during the fourth quarter of fiscal 2013. The dollar value of net contracts, including unconsolidated joint ventures, for the fourth quarter ended October 31, 2014 increased 8.4% to $531.9 million compared with $490.5 million in the 2013 fourth quarter.
  • For the three months ended October 31, 2014, the number of consolidated net contracts increased 7.9% to 1,301 homes compared with 1,206 homes in the fourth quarter of the previous year. The number of net contracts, including unconsolidated joint ventures, increased 2.7% to 1,350 homes in the fourth quarter of fiscal 2014 from 1,315 homes in the fiscal 2013 fourth quarter.
  • For all of fiscal 2014, the dollar value of consolidated net contracts increased 10.0% to $2.11 billion compared with $1.91 billion in the prior fiscal year. The dollar value of net contracts, including unconsolidated joint ventures, for the year ended October 31, 2014 was $2.23 billion compared with $2.20 billion during last fiscal year, an increase of 1.7%.
  • During fiscal 2014, the number of consolidated net contracts increased slightly to 5,559 homes from 5,544 homes in the same period of the previous year. The number of net contracts, including unconsolidated joint ventures, decreased 4.8% to 5,883 homes for the twelve months ended October 31, 2014 from 6,177 homes during the same period a year ago.
  • Consolidated net contracts per active selling community increased 3.2% from 6.5 net contracts per community during the fourth quarter of fiscal 2014 compared with 6.3 net contracts per active selling community during the same quarter one year ago. During all of fiscal 2014, consolidated net contracts per community decreased 7.5% to 28.4 net contracts per community compared with 30.7 net contracts per community last year.
  • As of October 31, 2014, the dollar value of consolidated contract backlog increased 12.3% to $855.8 million compared with $762.4 million at October 31, 2013. The dollar value of contract backlog, as of October 31, 2014, including unconsolidated joint ventures, was $905.0 million, an increase of 6.7%, compared with $848.4 million as of October 31, 2013.
  • As of October 31, 2014, the number of homes in consolidated contract backlog increased 2.9% to 2,229 homes compared with 2,167 homes as of the end of the fourth quarter of fiscal 2013. Contract backlog, as of October 31, 2014, including unconsolidated joint ventures, decreased to 2,341 homes compared with 2,392 homes as of October 31, 2013.
  • Total interest expense as a percentage of total revenues declined 140 basis points to 5.3% during the fiscal 2014 fourth quarter compared with 6.7% in last year's fourth quarter. For all of fiscal 2014, total interest expense as a percentage of total revenues declined 90 basis points to 6.9% compared with 7.8% in the prior year.
  • Total SG&A was $65.2 million, or 9.3% of total revenues, for the fiscal 2014 fourth quarter compared to $63.0 million, or 10.6% of total revenues, during the fourth quarter of fiscal 2013. Total SG&A was $254.9 million, or 12.4% of total revenues, for the twelve months ended October 31, 2014 compared to $220.2 million, or 11.9% of total revenues, in fiscal 2013.
  • Adjusted EBITDA increased to $77.7 million for the three months ended October 31, 2014 compared to $77.4 million in the fourth quarter of the previous year. Adjusted EBITDA decreased to $173.4 million for all of fiscal 2014 compared to $179.6 million for fiscal 2013.
  • The contract cancellation rate, including unconsolidated joint ventures, for the fourth quarter of fiscal 2014 was 22%, compared with 23% in the fourth quarter of the prior year.
  • During November of 2014, the dollar value of consolidated net contracts and the number of consolidated net contracts increased 25.3% and 18.3%, respectively, to $167.3 million compared with $133.5 million and to 408 homes from 345 homes in November 2013.
  • After the partial reduction of $285.1 million during the fourth quarter of fiscal 2014, the valuation allowance was $642.0 million as of October 31, 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 OCTOBER 31, 2014:

  • During the fourth quarter of fiscal 2014, $161.3 million was spent on land and land development. For the year ended October 31, 2014, the dollar amount spent on land and land development was $585.8 million.
  • In November 2014, $250.0 million of 8.00% senior unsecured notes due November 2019 were issued.
  • Total liquidity at the end of the fiscal 2014 fourth quarter was $309.2 million compared to $373.5 million at October 31, 2013. Total liquidity at October 31, 2014 included $255.1 million of homebuilding cash, $5.6 million of restricted cash required to collateralize letters of credit and $48.5 million of availability under the unsecured revolving credit facility. Total liquidity pro forma for the $250.0 million senior notes offering in November 2014 would have been $554.9 million at October 31, 2014.
  • As of October 31, 2014, the land position, including unconsolidated joint ventures, was 37,558 lots, consisting of 17,702 lots under option and 19,856 owned lots, an increase of 3,096 lots compared with a total of 34,462 lots as of October 31, 2013.
  • During the fourth quarter of fiscal 2014, approximately 3,200 lots, including unconsolidated joint ventures, were put under option or acquired in 50 communities.

COMMENTS FROM MANAGEMENT:

"Although we generated growth in revenues and achieved our second consecutive year of profitability, 2014 has been a disappointing year for the housing industry and Hovnanian," stated Ara K. Hovnanian, Chairman of the Board, President and Chief Executive Officer. "During 2014 both Hovnanian and the industry experienced a decline in sales pace per community versus 2013 and that slower pace remains substantially below normal annual levels. We began fiscal 2015 on a much better note. Going forward, we are focused on growing our revenues so that we will be able to leverage our fixed SG&A and interest costs, which would help drive increased profitability. We continue to believe the housing industry remains in the early stages of a recovery. Improving demographic and employment trends should result in a more robust housing market that returns both national housing starts and sales pace per community to normalized levels," concluded Mr. Hovnanian.

WEBCAST INFORMATION:

Hovnanian Enterprises will webcast its fiscal 2014 fourth quarter financial results conference call at 11:00 a.m. E.T. on Wednesday, December 10, 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® and Parkwood Builders. 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 income. The reconciliation of EBIT, EBITDA and Adjusted EBITDA to net income is presented in a table attached to this earnings release.

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 Income Before Income Taxes. The reconciliation of Income Before Income Taxes Excluding Land-Related Charges and Loss on Extinguishment of Debt to Income 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) levels of indebtedness and restrictions on the Company's operations and activities imposed by the agreements governing the Company's outstanding indebtedness; (4) the Company's sources of liquidity; (5) changes in credit ratings; (6) changes in market conditions and seasonality of the Company's business; (7) the availability and cost of suitable land and improved lots; (8) shortages in, and price fluctuations of, raw materials and labor; (9) changes in home prices and sales activity in the markets where the Company builds homes; (10) fluctuations in interest rates and the availability of mortgage financing; (11) changes in tax laws affecting the after-tax costs of owning a home; (12) operations through joint ventures with third parties; (13) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, tax laws and the environment; (14) product liability litigation, warranty claims and claims made by mortgage investors; (15) levels of competition; (16) availability of financing to the Company; (17) successful identification and integration of acquisitions; (18) significant influence of the Company's controlling stockholders; (19) availability of net operating loss carryforwards; (20) utility shortages and outages or rate fluctuations; (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.
October 31, 2014
Statements of Consolidated Operations
(Dollars in Thousands, Except Per Share Data)
Three Months Ended Twelve Months Ended
October 31, October 31,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Total Revenues $698,394 $591,687 $2,063,380 $1,851,253
Costs and Expenses (a) 666,446 562,547 2,049,942 1,840,598
Loss on Extinguishment of Debt -- (760) (1,155) (760)
Income from Unconsolidated Joint Ventures 4,048 5,234 7,897 12,040
Income Before Income Taxes 35,996 33,614 20,180 21,935
Income Tax (Benefit) Provision (286,468) 795 (286,964) (9,360)
Net Income $322,464 $32,819 $307,144 $31,295
Per Share Data:
Basic:
Income Per Common Share $2.15 $0.22 $2.05 $0.22
Weighted Average Number of Common Shares Outstanding 146,413 145,821 146,271 145,087
Assuming Dilution:
Income Per Common Share $1.95 $0.21 $1.87 $0.22
Weighted Average Number of Common Shares Outstanding 161,720 162,100 162,441 162,329
(a) Includes inventory impairment loss and land option write-offs.
Hovnanian Enterprises, Inc.
October 31, 2014
Reconciliation of Income Before Income Taxes Excluding Land-Related Charges and
Loss on Extinguishment of Debt to Income Before Income Taxes
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
October 31, October 31,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Income Before Income Taxes $35,996 $33,614 $20,180 $21,935
Inventory Impairment Loss and Land Option Write-Offs 3,297 1,486 5,224 4,965
Loss on Extinguishment of Debt -- 760 1,155 760
Income Before Income Taxes Excluding Land-Related Charges and Loss on Extinguishment of Debt (a) $39,293 $35,860 $26,559 $27,660
(a) 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 Income Before Income Taxes.
Hovnanian Enterprises, Inc.
October 31, 2014
Gross Margin
(Dollars in Thousands)
Homebuilding Gross Margin Homebuilding Gross Margin
Three Months Ended Twelve Months Ended
October 31, October 31,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Sale of Homes $681,523 $578,094 $2,013,013 $1,784,327
Cost of Sales, Excluding Interest and Land Charges(a) 550,242 447,723 1,612,122 1,426,032
Homebuilding Gross Margin, Excluding Interest and Land Charges 131,281 130,371 400,891 358,295
Homebuilding Cost of Sales Interest 15,854 16,850 53,101 51,939
Homebuilding Gross Margin, Including Interest and Excluding Land Charges $115,427 $113,521 $347,790 $306,356
Gross Margin Percentage, Excluding Interest and Land Charges 19.3% 22.6% 19.9% 20.1%
Gross Margin Percentage, Including Interest and Excluding Land Charges 16.9% 19.6% 17.3% 17.2%
Land Sales Gross Margin Land Sales Gross Margin
Three Months Ended Twelve Months Ended
October 31, October 31,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Land and Lot Sales $2,327 $2,493 $5,224 $17,711
Cost of Sales, Excluding Interest and Land Charges(a) 1,492 1,959 3,077 16,012
Land and Lot Sales Gross Margin, Excluding Interest and Land Charges 835 534 2,147 1,699
Land and Lot Sales Interest 388 69 865 291
Land and Lot Sales Gross Margin, Including Interest and Excluding Land Charges $447 $465 $1,282 $1,408
(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 Consolidated Statements of Operations.
Hovnanian Enterprises, Inc.
October 31, 2014
Reconciliation of Adjusted EBITDA to Net Income
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
October 31, October 31,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Net Income $322,464 $32,819 $307,144 $31,295
Income Tax (Benefit) Provision (286,468) 795 (286,964) (9,360)
Interest Expense 36,935 39,682 141,344 143,574
EBIT (a) 72,931 73,296 161,524 165,509
Depreciation 286 930 1,132 4,712
Amortization of Debt Costs 1,152 940 4,392 3,659
EBITDA (b) 74,369 75,166 167,048 173,880
Inventory Impairment Loss and Land Option Write-offs 3,297 1,486 5,224 4,965
Loss on Extinguishment of Debt -- 760 1,155 760
Adjusted EBITDA (c) $77,666 $77,412 $173,427 $179,605
Interest Incurred $37,336 $34,798 $145,409 $132,611
Adjusted EBITDA to Interest Incurred 2.08 2.22 1.19 1.35
(a) EBIT is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net 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 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 income. Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation, amortization, inventory impairment loss and land option write-offs and loss on extinguishment of debt.
Hovnanian Enterprises, Inc.
October 31, 2014
Interest Incurred, Expensed and Capitalized
(Dollars in Thousands)
Three Months Ended Twelve Months Ended
October 31, October 31,
2014 2013 2014 2013
(Unaudited) (Unaudited)
Interest Capitalized at Beginning of Period $108,757 $109,977 $105,093 $116,056
Plus Interest Incurred 37,336 34,798 145,409 132,611
Less Interest Expensed 36,935 39,682 141,344 143,574
Interest Capitalized at End of Period (a) $109,158 $105,093 $109,158 $105,093
(a) Capitalized interest amounts are shown gross before allocating any portion of impairments to capitalized interest.
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands)
October 31,
2014
October 31,
2013
(Unaudited) (1)
ASSETS
Homebuilding:
Cash and cash equivalents $255,117 $319,142
Restricted cash and cash equivalents 13,086 10,286
Inventories:
Sold and unsold homes and lots under development 961,994 752,749
Land and land options held for future development or sale 273,463 225,152
Consolidated inventory not owned:
Specific performance options 3,479 792
Other options 105,374 100,071
Total consolidated inventory not owned 108,853 100,863
Total inventories 1,344,310 1,078,764
Investments in and advances to unconsolidated joint ventures 63,883 51,438
Receivables, deposits, and notes, net 92,546 45,085
Property, plant, and equipment, net 46,744 46,211
Prepaid expenses and other assets 69,358 59,351
Total homebuilding 1,885,044 1,610,277
Financial services:
Cash and cash equivalents 6,781 10,062
Restricted cash and cash equivalents 16,236 21,557
Mortgage loans held for sale at fair value 95,338 112,953
Other assets 1,988 4,281
Total financial services 120,343 148,853
Income taxes receivable – including net deferred tax benefits 284,543 --
Total assets $2,289,930 $1,759,130
(1) Derived from the audited balance sheet as of October 31, 2013
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Amounts)
October 31,
2014
October 31,
2013
(Unaudited) (1)
LIABILITIES AND EQUITY
Homebuilding:
Nonrecourse land mortgages $103,908 $62,903
Accounts payable and other liabilities 370,876 307,764
Customers' deposits 34,969 30,119
Nonrecourse mortgages secured by operating properties 16,619 17,733
Liabilities from inventory not owned 92,381 87,866
Total homebuilding 618,753 506,385
Financial services:
Accounts payable and other liabilities 22,278 32,874
Mortgage warehouse line of credit 76,919 91,663
Total financial services 99,197 124,537
Notes payable:
Senior secured notes, net of discount 979,935 978,611
Senior notes, net of discount 590,472 461,210
Senior amortizing notes 17,049 20,857
Senior exchangeable notes 70,101 66,615
TEU senior subordinated amortizing notes -- 2,152
Accrued interest 32,222 28,261
Total notes payable 1,689,779 1,557,706
Income taxes payable -- 3,301
Total liabilities 2,407,729 2,191,929
Equity:
Hovnanian Enterprises, Inc. stockholders' equity deficit:
Preferred stock, $.01 par value - authorized 100,000 shares; issued 5,600 shares with a liquidation preference of $140,000 at October 31, 2014 and at October 31, 2013 135,299 135,299
Common stock, Class A, $.01 par value – authorized 400,000,000 shares; issued 142,836,563 shares at October 31, 2014 and 136,306,223 shares at October 31, 2013 (including 11,760,763 shares at October 31, 2014 and October 31, 2013, respectively, held in Treasury) 1,428 1,363
Common stock, Class B, $.01 par value (convertible to Class A at time of sale) – authorized 60,000,000 shares; issued 15,497,543 shares at October 31, 2014 and 15,347,615 shares at October 31, 2013 (including 691,748 shares at October 31, 2014 and October 31, 2013 held in Treasury) 155 153
Paid in capital - common stock 697,943 689,727
Accumulated deficit (837,264) (1,144,408)
Treasury stock - at cost (115,360) (115,360)
Total Hovnanian Enterprises, Inc. stockholders' equity deficit (117,799) (433,226)
Noncontrolling interest in consolidated joint ventures -- 427
Total equity deficit (117,799) (432,799)
Total liabilities and equity $2,289,930 $1,759,130
(1) Derived from the audited balance sheet as of October 31, 2013
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Per Share Data)
(Unaudited)
Three Months Ended October 31, Twelve Months Ended October 31,
2014 2013 2014 2013
Revenues:
Homebuilding:
Sale of homes $681,523 $578,094 $2,013,013 $1,784,327
Land sales and other revenues 3,069 1,085 7,953 19,199
Total homebuilding 684,592 579,179 2,020,966 1,803,526
Financial services 13,802 12,508 42,414 47,727
Total revenues 698,394 591,687 2,063,380 1,851,253
Expenses:
Homebuilding:
Cost of sales, excluding interest 551,734 449,682 1,615,199 1,442,044
Cost of sales interest 16,242 16,919 53,966 52,230
Inventory impairment loss and land option write-offs 3,297 1,486 5,224 4,965
Total cost of sales 571,273 468,087 1,674,389 1,499,239
Selling, general and administrative 48,619 48,905 191,537 165,809
Total homebuilding expenses 619,892 516,992 1,865,926 1,665,048
Financial services 8,025 7,854 28,616 29,059
Corporate general and administrative 16,538 14,073 63,375 54,357
Other interest 20,693 22,763 87,378 91,344
Other operations 1,298 865 4,647 790
Total expenses 666,446 562,547 2,049,942 1,840,598
Loss on extinguishment of debt -- (760) (1,155) (760)
Income from unconsolidated joint ventures 4,048 5,234 7,897 12,040
Income before income taxes 35,996 33,614 20,180 21,935
State and federal income tax (benefit) provision:
State (13,936) 795 (12,452) 518
Federal (272,532) -- (274,512) (9,878)
Total income taxes (286,468) 795 (286,964) (9,360)
Net income $322,464 $32,819 $307,144 $31,295
Per share data:
Basic:
Income per common share $2.15 $0.22 $2.05 $0.22
Weighted-average number of common shares outstanding 146,413 145,821 146,271 145,087
Assuming dilution:
Income per common share $1.95 $0.21 $1.87 $0.22
Weighted-average number of common shares outstanding 161,720 162,100 162,441 162,329
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED)
Communities Under Development
Three Months - October 31, 2014
Net Contracts Deliveries Contract
Three Months Ended Three Months Ended Backlog
Oct 31, Oct 31, Oct 31,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(NJ, PA) Home 102 140 (27.1)% 182 226 (19.5)% 146 220 (33.6)%
Dollars $51,176 $68,499 (25.3)% $95,886 $105,914 (9.5)% $73,327 $105,006 (30.2)%
Avg. Price $501,725 $489,276 2.5% $526,845 $468,646 12.4% $502,240 $477,299 5.2%
Mid-Atlantic
(DE, MD, VA, WV) Home 190 143 32.9% 244 182 34.1% 371 271 36.9%
Dollars $96,981 $71,797 35.1% $113,144 $89,048 27.1% $188,923 $141,168 33.8%
Avg. Price $510,425 $502,076 1.7% $463,709 $489,275 (5.2)% $509,227 $520,916 (2.2)%
Midwest
(IL, MN, OH) Home 233 203 14.8% 263 206 27.7% 665 605 9.9%
Dollars $77,917 $59,808 30.3% $78,203 $53,313 46.7% $188,595 $150,716 25.1%
Avg. Price $334,406 $294,621 13.5% $297,354 $258,799 14.9% $283,601 $249,118 13.8%
Southeast
(FL, GA, NC, SC) Home 149 129 15.5% 178 162 9.9% 232 308 (24.7%)
Dollars $51,495 $42,901 20.0% $57,297 $45,276 26.6% $81,071 $98,656 (17.8%)
Avg. Price $345,603 $332,566 3.9% $321,895 $279,483 15.2% $349,443 $320,312 9.1%
Southwest
(AZ, TX) Home 547 501 9.2% 747 706 5.8% 770 677 13.7%
Dollars $194,178 $149,593 29.8% $254,668 $220,948 15.3% $295,319 $216,367 36.5%
Avg. Price $354,988 $298,589 18.9% $340,919 $312,956 8.9% $383,532 $319,597 20.0%
West
(CA) Home 80 90 (11.1)% 148 126 17.5% 45 86 (47.7)%
Dollars $40,030 $50,747 (21.1)% $82,325 $63,595 29.5% $28,612 $50,526 (43.4)%
Avg. Price $500,375 $563,858 (11.3)% $556,248 $504,720 10.2% $635,822 $587,516 8.2%
Consolidated Total
Home 1,301 1,206 7.9% 1,762 1,608 9.6% 2,229 2,167 2.9%
Dollars $511,777 $443,345 15.4% $681,523 $578,094 17.9% $855,847 $762,439 12.3%
Avg. Price $393,372 $367,616 7.0% $386,789 $359,511 7.6% $383,960 $351,841 9.1%
Unconsolidated Joint Ventures
Home 49 109 (55.0)% 154 208 (26.0)% 112 225 (50.2)%
Dollars $20,133 $47,135 (57.3)% $58,712 $96,369 (39.1)% $49,123 $85,936 (42.8)%
Avg. Price $410,877 $432,431 (5.0)% $381,245 $463,313 (17.7)% $438,601 $381,938 14.8%
Grand Total
Home 1,350 1,315 2.7% 1,916 1,816 5.5% 2,341 2,392 (2.1)%
Dollars $531,910 $490,480 8.4% $740,235 $674,463 9.8% $904,970 $848,375 6.7%
Avg. Price $394,008 $372,989 5.6% $386,344 $371,401 4.0% $386,574 $354,672 9.0%
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
Twelve Months - October 31, 2014
Net Contracts Deliveries Contract
Twelve Months Ended Twelve Months Ended Backlog
Oct 31, Oct 31, Oct 31,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(NJ, PA) Home 476 573 (16.9)% 550 617 (10.9)% 146 220 (33.6)%
Dollars $243,055 $269,284 (9.7)% $274,734 $279,695 (1.8)% $73,327 $105,006 (30.2)%
Avg. Price $510,620 $469,955 8.7% $499,516 $453,314 10.2% $502,240 $477,299 5.2%
Mid-Atlantic
(DE, MD, VA, WV) Home 801 628 27.5% 701 623 12.5% 371 271 36.9%
Dollars $379,514 $310,718 22.1% $331,759 $288,323 15.1% $188,923 $141,168 33.8%
Avg. Price $473,801 $494,774 (4.2)% $473,266 $462,798 2.3% $509,227 $520,916 (2.2)%
Midwest
(IL, MN, OH) Home 849 835 1.7% 789 657 20.1% 665 605 9.9%
Dollars $263,837 $217,759 21.2% $225,958 $162,758 38.8% $188,595 $150,716 25.1%
Avg. Price $310,762 $260,789 19.2% $286,386 $247,730 15.6% $283,601 $249,118 13.8%
Southeast
(FL, GA, NC, SC) Home 576 608 (5.3)% 652 535 21.9% 232 308 (24.7)%
Dollars $185,035 $182,225 1.5% $202,620 $146,264 38.5% $81,071 $98,656 (17.8)%
Avg. Price $321,241 $299,712 7.2% $310,768 $273,391 13.7% $349,443 $320,312 9.1%
Southwest
(AZ, TX) Home 2,482 2,502 (0.8)% 2,389 2,331 2.5% 770 677 13.7%
Dollars $826,707 $739,784 11.7% $747,753 $684,258 9.3% $295,319 $216,367 36.5%
Avg. Price $333,081 $295,677 12.7% $312,998 $293,547 6.6% $383,532 $319,597 20.0%
West
(CA) Home 375 398 (5.8)% 416 503 (17.3)% 45 86 (47.7)%
Dollars $208,273 $194,678 7.0% $230,189 $223,029 3.2% $28,612 $50,526 (43.4)%
Avg. Price $555,395 $489,142 13.5% $553,337 $443,398 24.8% $635,822 $587,516 8.2%
Consolidated Total
Home 5,559 5,544 0.3% 5,497 5,266 4.4% 2,229 2,167 2.9%
Dollars $2,106,421 $1,914,448 10.0% $2,013,013 $1,784,327 12.8% $855,847 $762,439 12.3%
Avg. Price $378,921 $345,319 9.7% $366,202 $338,839 8.1% $383,960 $351,841 9.1%
Unconsolidated Joint Ventures
Home 324 633 (48.8)% 437 664 (34.2)% 112 225 (50.2)%
Dollars $127,270 $282,205 (54.9)% $164,082 $306,174 (46.4)% $49,123 $85,936 (42.8)%
Avg. Price $392,809 $445,822 (11.9)% $375,475 $461,105 (18.6)% $438,601 $381,938 14.8%
Grand Total
Home 5,883 6,177 (4.8)% 5,934 5,930 0.1% 2,341 2,392 (2.1)%
Dollars $2,233,691 $2,196,653 1.7% $2,177,095 $2,090,501 4.1% $904,970 $848,375 6.7%
Avg. Price $379,686 $355,618 6.8% $366,885 $352,530 4.1% $386,574 $354,672 9.0%
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 - October 31, 2014
Net Contracts Deliveries Contract
Three Months Ended Three Months Ended Backlog
Oct 31, Oct 31, Oct 31,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(includes unconsolidated joint ventures) Home 105 162 (35.2)% 193 255 (24.3)% 166 233 (28.8)%
(NJ, PA) Dollars $52,988 $79,862 (33.7)% $98,668 $129,439 (23.8)% $81,581 $111,248 (26.7)%
Avg. Price $504,648 $492,973 2.4% $511,233 $507,604 0.7% $491,447 $477,459 2.9%
Mid-Atlantic
(includes unconsolidated joint ventures) Home 202 184 9.8% 296 262 13.0% 406 341 19.1%
(DE, MD, VA, WV) Dollars $103,555 $90,895 13.9% $140,246 $124,712 12.5% $209,961 $175,390 19.7%
Avg. Price $512,650 $493,994 3.8% $473,804 $476,000 (0.5)% $517,145 $514,341 0.5%
Midwest
(includes unconsolidated joint ventures) Home 235 219 7.3% 288 256 12.5% 682 654 4.3%
(IL, MN, OH) Dollars $78,603 $64,080 22.7% $85,032 $68,367 24.4% $193,260 $163,933 17.9%
Avg. Price $334,481 $292,603 14.3% $295,251 $267,057 10.6% $283,373 $250,663 13.0%
Southeast
(includes unconsolidated joint ventures) Home 168 155 8.4% 234 198 18.2% 261 393 (33.6)%
(FL, GA, NC, SC) Dollars $58,601 $52,301 12.0% $75,978 $58,948 28.9% $92,992 $125,734 (26.0)%
Avg. Price $348,814 $337,426 3.4% $324,692 $297,718 9.1% $356,293 $319,934 11.4%
Southwest
(includes unconsolidated joint ventures) Home 547 501 9.2% 747 706 5.8% 770 677 13.7%
(AZ, TX) Dollars $194,178 $149,593 29.8% $254,668 $220,947 15.3% $295,319 $216,367 36.5%
Avg. Price $354,988 $298,589 18.9% $340,919 $312,956 8.9% $383,532 $319,597 20.0%
West
(includes unconsolidated joint ventures) Home 93 94 (1.1)% 158 139 13.7% 56 94 (40.4)%
(CA) Dollars $43,985 $53,749 (18.2)% $85,643 $72,050 18.9% $31,857 $55,703 (42.8)%
Avg. Price $472,957 $571,800 (17.3)% $542,044 $518,343 4.6% $568,872 $592,590 (4.0)%
Grand Total
Home 1,350 1,315 2.7% 1,916 1,816 5.5% 2,341 2,392 (2.1%)
Dollars $531,910 $490,480 8.4% $740,235 $674,463 9.8% $904,970 $848,375 6.7%
Avg. Price $394,008 $372,989 5.6% $386,344 $371,401 4.0% $386,574 $354,672 9.0%
Consolidated Total
Home 1,301 1,206 7.9% 1,762 1,608 9.6% 2,229 2,167 2.9%
Dollars $511,777 $443,345 15.4% $681,523 $578,094 17.9% $855,847 $762,439 12.3%
Avg. Price $393,372 $367,616 7.0% $386,789 $359,511 7.6% $383,960 $351,841 9.1%
Unconsolidated Joint Ventures
Home 49 109 (55.0)% 154 208 (26.0)% 112 225 (50.2)%
Dollars $20,133 $47,135 (57.3)% $58,712 $96,369 (39.1)% $49,123 $85,936 (42.8)%
Avg. Price $410,877 $432,431 (5.0)% $381,245 $463,323 (17.7)% $438,601 $381,938 14.8%
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
Twelve Months - October 31, 2014
Net Contracts Deliveries Contract
Twelve Months Ended Twelve Months Ended Backlog
Oct 31, Oct 31, Oct 31,
2014 2013 % Change 2014 2013 % Change 2014 2013 % Change
Northeast
(includes unconsolidated joint ventures) Home 530 659 (19.6)% 597 720 (17.1)% 166 233 (28.8)%
(NJ, PA) Dollars $264,303 $334,072 (20.9)% $293,970 $363,777 (19.2)% $81,581 $111,248 (26.7)%
Avg. Price $498,684 $506,938 (1.6)% $492,413 $505,246 (2.5)% $491,447 $477,459 2.9%
Mid-Atlantic
(includes unconsolidated joint ventures) Home 925 883 4.8% 860 908 (5.3)% 406 341 19.1%
(DE, MD, VA, WV) Dollars $436,416 $425,970 2.5% $401,845 $413,780 (2.9)% $209,961 $175,390 19.7%
Avg. Price $471,801 $482,412 (2.2)% $467,261 $455,705 2.5% $517,145 $514,341 0.5%
Midwest
(includes unconsolidated joint ventures) Home 891 949 (6.1)% 863 794 8.7% 682 654 4.3%
(IL, MN, OH) Dollars $275,550 $250,416 10.0% $246,224 $202,400 21.7% $193,260 $163,933 17.9%
Avg. Price $309,260 $263,873 17.2% $285,312 $254,912 11.9% $283,373 $250,663 13.0%
Southeast
(includes unconsolidated joint ventures) Home 658 745 (11.7)% 790 635 24.4% 261 393 (33.6)%
(FL, GA, NC, SC) Dollars $215,186 $227,373 (5.4)% $247,928 $180,979 37.0% $92,992 $125,734 (26.0)%
Avg. Price $327,031 $305,198 7.2% $313,832 $285,007 10.1% $356,293 $319,934 11.4%
Southwest
(includes unconsolidated joint ventures) Home 2,482 2,502 (0.8)% 2,389 2,331 2.5% 770 677 13.7%
(AZ, TX) Dollars $826,707 $739,784 11.7% $747,753 $684,258 9.3% $295,319 $216,367 36.5%
Avg. Price $333,081 $295,677 12.7% $312,998 $293,547 6.6% $383,532 $319,597 20.0%
West
(includes unconsolidated joint ventures) Home 397 439 (9.6)% 435 542 (19.7)% 56 94 (40.4)%
(CA) Dollars $215,529 $219,038 (1.6)% $239,375 $245,307 (2.4)% $31,857 $55,703 (42.8)%
Avg. Price $542,895 $498,948 8.8% $550,290 $452,596 21.6% $568,872 $592,590 (4.0)%
Grand Total
Home 5,883 6,177 (4.8)% 5,934 5,930 0.1% 2,341 2,392 (2.1%)
Dollars $2,233,691 $2,196,653 1.7% $2,177,095 $2,090,501 4.1% $904,970 $848,375 6.7%
Avg. Price $379,686 $355,618 6.8% $366,885 $352,530 4.1% $386,574 $354,672 9.0%
Consolidated Total
Home 5,559 5,544 0.3% 5,497 5,266 4.4% 2,229 2,167 2.9%
Dollars $2,106,421 $1,914,448 10.0% $2,013,013 $1,784,327 12.8% $855,847 $762,439 12.3%
Avg. Price $378,921 $345,319 9.7% $366,202 $338,839 8.1% $383,960 $351,841 9.1%
Unconsolidated Joint Ventures
Home 324 633 (48.8)% 437 664 (34.2)% 112 225 (50.2)%
Dollars $127,270 $282,205 (54.9)% $164,082 $306,174 (46.4)% $49,123 $85,936 (42.8)%
Avg. Price $392,809 $445,822 (11.9)% $375,475 $461,105 (18.6)% $438,601 $381,938 14.8%
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.