Q2 2024 M/I Homes Inc Earnings Call Transcript
Key Points
- Record-setting revenue and income for the second quarter, with revenues reaching $1.1 billion.
- Gross margins improved to 28% from 26% last year, and pre-tax margins increased to 17.5% from 15.3%.
- Strong balance sheet with $2.7 billion in equity and over $800 million in cash, with zero borrowings under the $650 million unsecured revolving credit facility.
- Significant increase in new contracts in the northern region by 6%, and a 21% increase in deliveries or closings in the northern region.
- Mortgage and title operations achieved a 29% increase in pre-tax income, with revenue increasing by 22% to an all-time quarterly record of $30.8 million.
- General economic uncertainty and rising interest rates have led to a slight decline in traffic and demand compared to the first quarter.
- Increased inventory in select markets, particularly Florida and Texas, which could impact future sales.
- SG&A expenses increased to 11.0% of revenue compared to 10.6% a year ago, due to higher selling expenses and additional headcount.
- Average closing price decreased by 2% compared to last year's second quarter.
- Increased use of incentives, such as below-market financing, to drive sales, which could impact future margins.
Good morning, ladies and gentlemen, and welcome to the M/I Homes, Inc. second quarter earnings conference call. (Operator Instructions) This call is being recorded on Wednesday, July 30, 2024. I would now like to turn the conference over to Phil Creek. Please go ahead.
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Thank you. Joining me on the call today is Bob Schottenstein, our CEO and President; and Derek Klutch, President of our Mortgage Company. First, to address regulation fair disclosure, we encourage you to ask any questions regarding issues that you consider material during this call because we are prohibited from discussing significant non-public items with you directly.
And as to forward-looking statements, I want to remind everyone that the cautionary language about forward-looking statements contained in today's press release also applies to any comments made during this call. Also, be advised that the company undertakes no obligation to update any
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