STUART, Fla., Jan. 15, 2024 (GLOBE NEWSWIRE) -- K. Hovnanian Homes introduces Salerno Reserve, a new community of single-family homes in Stuart. Salerno Reserve offers LOOKS: a designer-curated collection of beautiful interiors. Buyers can choose between Loft, Farmhouse, Classic or Elements LOOKS, and enjoy cohesive style without the stress. "By whittling down an overwhelming number of design choices, we've been able to focus on making our 'LOOKS' stand out," said Alexander Hovnanian, Executive Vice Preside ...

Company Performance - Hovnanian Enterprises, Inc. delivered 7,649 homes in fiscal 2023, contributing to a total of over 369,000 homes since its inception[12] - For the year ended October 31, 2023, consolidated housing revenues totaled $2.63 billion, with 4,878 homes delivered, resulting in an average sales price of $539,249[62] - The dollar value of net sales contracts for fiscal 2023 was $2.5 billion, with a 3.8% increase in the number of homes contracted to 4,647 from 4,477 in fiscal 2022[63] - The backlog of signed contracts decreased by 12.1% to 2,196 homes, with sales values aggregating $1.3 billion as of October 31, 2023[67] - The average number of active selling communities increased slightly from 113 in fiscal 2022 to 114 in fiscal 2023, ending with 113 active selling communities[64] Sales and Pricing - The average sales price of homes sold in fiscal 2023 was $539,000, with base prices ranging from $135,000 to $1,770,000[13] - The average sales price of homes, including options, was $539,000 nationwide in fiscal 2023[13] - Current base prices for homes in contract backlog range from $135,000 to $1,770,000 in the Northeast, $294,000 to $1,140,000 in the Southeast, and $269,000 to $884,000 in the West[68] Workforce and Employment - The company employed 1,715 full-time associates as of October 31, 2023, with an average tenure of approximately 7.5 years[27] - As of October 31, 2023, 19% of associates had been with the company for over 15 years, highlighting employee retention efforts[29] - The company has a diverse workforce, with 25.6% non-white associates and 44.3% of associates being women[30] - The company has a repository of over 500 training modules/courses to facilitate associates' personal and professional growth[36] - The company introduced a hybrid work schedule allowing most office associates to work two days a week from home, promoting work-life balance[35] - The company is committed to diversity and inclusion, with approximately 21.9% of associates in leadership positions required to participate in extensive training sessions[34] Strategic Initiatives - In fiscal 2023, Hovnanian executed "Build-For-Rent" agreements, which added incremental sales volume and increased inventory turnover[38] - The company has 182 proposed communities, with 19,861 developable home sites and a combined book value of $153.291 million[71] - The company aims to achieve economies of scale by becoming a significant builder in each of its selected markets[40] - The company has a land banking arrangement valued at $27.7 million included in its consolidated inventory not owned[72] Financial Management - The company repurchased $245 million in aggregate principal of senior secured notes in fiscal 2023, reflecting a focus on maintaining adequate liquidity[39] - The company walked away from 3,838 lots in fiscal 2023, resulting in a pre-tax income charge of $1.5 million, as part of its strategy to minimize risks in underperforming communities[54] - The company has incurred approximately $79.9 million in option fees and deposits for properties under option as of October 31, 2023[71] Market Conditions - The company experienced construction delays due to material and labor shortages, with current construction cycle times 45-60 days longer than pre-pandemic averages[52] - Labor and material shortages have gradually improved since the COVID-19 pandemic, with lumber prices decreasing in the second half of fiscal 2022 and into fiscal 2023[74] - The company experienced a significant rise in lumber prices due to supply chain issues, but prices began to decrease during the second half of fiscal 2022 and into fiscal 2023[74] - The company is subject to extensive regulations that may impact its ability to develop communities, including potential building moratoriums[79] - The company is subject to extensive regulations that could affect the availability of land and building opportunities, potentially impacting future revenues and earnings[78] Customer Financing - In fiscal 2023, 19.8% of home buyers paid in cash, while 70.1% of noncash buyers obtained mortgages from the company's mortgage banking subsidiary[59] - The loans originated in fiscal 2023 included 69.8% conforming conventional loans and 29.5% FHA/VA loans[59]

Financial Data and Key Metrics Changes - Total revenues for fiscal 2023 were $2.76 billion, exceeding the high end of guidance [6] - Adjusted gross margin for Q4 was 22.7%, near the high end of the range [6] - Adjusted EBITDA for Q4 was $181 million, a 25% year-over-year increase [8] - Adjusted pre-tax income for Q4 was $144 million, a 38% increase over the prior year [8] - Net income for Q4 increased by 75% to $97 million, despite a one-time $22 million loss on debt extinguishment [23][24] Business Line Data and Key Metrics Changes - Contracts per community for Q4 increased by 66% year-over-year, with 8.3 contracts per community [9] - Annual contracts per community ended at 40.7, close to historical averages [11] - 62% of customers using mortgages utilized interest rate buy-down incentives [13] Market Data and Key Metrics Changes - Existing homes for sale remain low at 1 million, less than half the historical average [28][29] - Average home prices increased by 17% during Q4, with expectations for continued price increases if demand remains strong [30] Company Strategy and Development Direction - The company is focused on increasing community count and has spent significantly on land and development [31][40] - A strategy to control more lots through options has been successful, increasing from 46% in Q4 fiscal '15 to 77% in Q4 fiscal '23 [37] - The company aims to improve inventory turnover and reduce cycle times, with current average cycle times at 160 days [39][68] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about future growth prospects, citing favorable demographics and low supply of existing homes [31][49] - The company anticipates a strong spring selling season, supported by improved mortgage rates [24][50] - Management noted that the current market conditions are more favorable than the previous year, with a stronger balance sheet [80] Other Important Information - The company ended Q4 with $564 million in liquidity, the highest level since Q3 2009 [40] - A significant debt refinancing was completed, extending maturities and improving cash flow [41][105] - Book value per share grew at a compounded annual growth rate of 238% from the end of 2021 to Q4 fiscal '23 [74][106] Q&A Session Summary Question: Future volume growth and market share - Management indicated plans to become more aggressive in top-line growth while maintaining strong operational performance [54] Question: Current market conditions and pricing - Management noted that 71% of communities raised prices in Q3, and 54% in Q4, despite rising mortgage rates [58] Question: Incentives and mortgage rate buy-downs - Management explained that incentives vary by community and are adjusted based on market conditions [97] Question: Active adult segment and incentives - Management highlighted that the active adult segment uses fewer incentives, as many buyers have paid off previous mortgages [100] Question: Guidance and margin expectations - Management expressed caution in providing long-term guidance due to market volatility but indicated strong performance in Q4 [102][89]

Year Ended (1) The Company cannot provide a reconciliation between its non-GAAP projections and the most directly comparable GAAP measures without unreasonable efforts because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items required for the reconciliation. These items include, but are not limited to, land-related charges, inventory impairments and land option write-offs and loss (gain) on extinguishment of debt, net. These items are uncertain, depend on va ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended July 31, 2023 OR ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission file number 1-8551 Hovnanian Enterprises, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware (State or Other Jurisdiction of Incorporation or O ...

Hovnanian Enterprises, Inc. (NYSE:HOV) Q3 2023 Earnings Conference Call August 30, 2023 11:00 AM ET Company Participants Jeff O'Keefe - Vice President, Investor Relations Ara Hovnanian - Chairman, President and Chief Executive Officer Brad O'Connor - Chief Accounting Officer and Treasurer Conference Call Participants Alan Ratner - Zelman & Associates Operator Good morning, and thank you for joining us today for Hovnanian Enterprises Fiscal 2023 Third Quarter Earnings Conference Call. An archive of the webca ...

Adjusted Income Before Income Taxes $50 $60 Q3 2023 $75 Guidance Q3 2023 $83 10 Excluding Build for Rent 2.1 3.8 3.6 Including Build for Rent 22.0 20.0 19.1 17.9 26.8 34.9 38.3 36.9 42.0 46.3 45.9 41.8 24.4 21.2 21.8 22.4 29.8 42.5 47.1 47.4 Aug-22 74.4 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 44.1 Annual Contracts Per Community Including Build for Rent 44.0 28.4 30.0 31.4 35.1 36.0 38.9 54.2 55.2 38.9 39.5 54.8 avg. 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q3 2023 19 ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended April 30, 2023 OR ☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission file number 1-8551 Hovnanian Enterprises, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware (State or Other Jurisdiction of Incorporation or ...

Financial Data and Key Metrics - Total revenues for Q2 2023 were $704 million, flat year-over-year [18] - Adjusted gross margin was 20.9% in Q2 2023, down from 26.6% in Q2 2022 [18] - SG&A expenses were 10.7% of total revenues in Q2 2023, compared to 9.7% in Q2 2022 [19] - Adjusted EBITDA was $87 million in Q2 2023, down from $124 million in Q2 2022 [19] - Net income for Q2 2023 was $34 million, compared to $62 million in Q2 2022 [19] - Net debt to adjusted EBITDA was 2.2x at the end of Q1 2023, down significantly from 8.9x in 2019 [10] Business Line Data and Key Metrics - Contracts per community increased 18% from 3.3 in May 2022 to 3.9 in May 2023 [20] - Quick move-in (QMI) homes accounted for 60% of sales in 2023, up from 40% historically [48] - The cancellation rate in Q2 2023 returned to a normalized 18% [22] - The company has 4.8 QMIs per community at the end of Q2 2023, slightly above the historical average [48] Market Data and Key Metrics - The number of existing homes for sale in the US remains depressed at 910,000, less than half of the historical average of over 2 million [24] - Contracts per community in the West segment improved significantly in Q2 2023, closing the gap with the Northeast and Southeast [46] - The company raised net home prices in 69% of its communities during Q2 2023, reflecting strong demand [92] Company Strategy and Industry Competition - The company is focused on increasing the use of land options to enhance inventory turns and reduce risk [28][54] - The company has a 5.5-year supply of controlled land, with 71% of lots controlled via options [54][55] - The company is targeting a return to top-line growth in fiscal 2024, driven by an increase in new communities and a solid pace in contracts per community [27] - The company is trading at a 41% discount to the homebuilding industry average PE ratio, despite strong financial metrics [34] Management Commentary on Operating Environment and Future Outlook - Management is optimistic about future growth prospects, citing favorable demographics and a persistently low supply of existing homes [51] - The company expects total revenues for fiscal 2023 to be between $2.5 billion and $2.65 billion, with adjusted gross margins of 21% to 22.5% [32] - Management anticipates returning to a more normalized sales pace and increasing community count, which should drive growth in fiscal 2024 [27] - The company is closely monitoring the high-yield market for potential refinancing opportunities [4] Other Important Information - The company reduced staffing levels by 10% since the end of fiscal 2022 and implemented salary reductions for senior executives to cut SG&A costs [25] - The company redeemed $100 million of its 7.75% senior secured notes in May 2023, bringing total debt reduction since fiscal 2020 to $494 million [57] - The company has $337 million in deferred tax assets, which will enhance cash flow by offsetting future tax liabilities [57] Q&A Session Summary Question: Why did May contracts per community decline slightly compared to April? - The decline was attributed to seasonality, with May having only 4 Sundays compared to April's 5 Sundays, and a drop in build-for-rent (BFR) sales [108] Question: What is the company's plan for debt reduction? - The company plans to continue reducing debt in future periods, balancing investments in land with strengthening the balance sheet [68][71] Question: How are margins for quick move-in (QMI) homes compared to to-be-built homes? - The margin spread between QMIs and to-be-built homes has narrowed, with some markets showing identical margins for both [81][82] Question: Will the company pay cash taxes in the near future? - The company will not pay federal income taxes due to its deferred tax assets, but it will pay some state taxes [85][102]

Total Revenues (1) The Company cannot provide a reconciliation between its non-GAAP projections and the most directly comparable GAAP measures without unreasonable efforts because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items required for the reconciliation. These items include, but are not limited to, land-related charges, inventory impairments and land option write-offs and loss (gain) on extinguishment of debt, net. These items are uncertain, depend o ...