PUYALLUP, Wash., Feb. 27, 2026 (GLOBE NEWSWIRE) -- LGI Homes, INC. (NASDAQ: LGIH) announced the Grand Opening of Meadow Brook, a new community in Puyallup, Washington. Featuring upgraded homes from the $500s, Meadow Brook expands the Company’s presence in the Seattle market and delivers new housing opportunities in a highly sought-after area near Tacoma. “We’re excited for the Grand Opening of Meadow Brook in Puyallup, where we’ve had a strong history of success with four previous communities,” stated Zacha ...

The Gregory Floorplan at Meadow Brook The four-bedroom, two-and-a-half-bath Gregory plan features the LGI Homes CompleteHome Plus package. PUYALLUP, Wash., Feb. 27, 2026 (GLOBE NEWSWIRE) -- LGI Homes, INC. (NASDAQ: LGIH) announced the Grand Opening of Meadow Brook, a new community in Puyallup, Washington. Featuring upgraded homes from the $500s, Meadow Brook expands the Company’s presence in the Seattle market and delivers new housing opportunities in a highly sought-after area near Tacoma. “We’re excit ...

Sales and Financial Performance - The company has successfully increased home sales prices to absorb rising costs associated with labor, commodities, and lumber, mitigating inflationary pressures experienced in recent years[46]. - The company expects to face cost pressures from inflation similar to those experienced in the last few years, which could impact future quarters[46]. - The company continues to monitor supply markets to achieve the best prices for raw materials and labor, which are critical to its operations[46]. Employment and Training - As of December 31, 2025, the company employed 1,056 people, with 622 in on-site sales and support roles and 342 involved in acquisition, development, purchasing, and construction[53]. - The company has implemented a structured 100-day training program for sales professionals, emphasizing ongoing training and development[55]. Community Engagement - The company has contributed over $4.0 million in corporate sponsorships and over 50,000 employee service hours to local communities since 2016[58]. Industry Competition - The homebuilding industry is highly competitive, with the company competing against numerous national, regional, and local homebuilders, as well as existing home sales and rental markets[51]. Environmental Regulations - The company is subject to various environmental regulations that may result in delays and increased costs, particularly in environmentally sensitive areas[48]. - The company has not incurred any material unanticipated liabilities related to environmental conditions or toxic waste removal[50]. Debt and Interest Rates - The company utilizes both fixed-rate and variable-rate debt for financing, with no obligation to prepay senior notes or fixed-rate inventory obligations prior to maturity[288]. - As of December 31, 2025, the company had $527.6 million of variable rate indebtedness outstanding under the Credit Agreement[290]. - The interest rate for the variable rate indebtedness was SOFR plus 1.85%, with SOFR at 3.72% as of December 31, 2025[290]. - A hypothetical 100 basis point increase in the average interest rate above the SOFR floor would increase annual interest costs by approximately $5.3 million[290]. - The company believes that future interest rate risks related to existing indebtedness will not have a material adverse impact on its financial position, results of operations, or liquidity[291].

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Operational focus has shifted toward capital discipline, evidenced by a 14.2% year-over-year reduction in controlled lots to align with current absorption rates.The company's self-development land strategy remains a core structural advantage, with finished lot costs averaging approximately $70,000, or 21% of the average selling price.LGI is maintaining a high-volume 'gross sale' strategy, intentionally writing more contracts to capture a larger pool of qualified buyers despite the higher resulting cancellat ...

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Financial Data and Key Metrics Changes - Revenue in Q4 2025 was $474 million, a 19.5% sequential increase driven by elevated sales activity [12] - Gross margin before inventory-related charges was over 19%, with an adjusted gross margin of over 22% [6][13] - Net income for Q4 was $17.3 million, or $0.75 per share, while excluding impairment-related charges, net income was $22.4 million, or $0.97 per share [15] Business Line Data and Key Metrics Changes - The company delivered 1,362 homes in Q4, with 1,301 contributing directly to revenue [5] - The average selling price of homes in Q4 was $364,000, slightly down compared to the previous year [12] - The wholesale business accounted for 12.1% of Q4 closings, generating significant revenue [12] Market Data and Key Metrics Changes - The cancellation rate increased to 43.3%, influenced by affordability pressures and economic uncertainty [9] - The backlog grew 133% to 1,394 homes, with a value exceeding $501 million, up 112% year-over-year [10] - The company ended the year with 144 active communities, averaging 3.1 closings per community per month in Q4 [8] Company Strategy and Development Direction - The company remains focused on managing costs, offering competitive financing options, and delivering affordable homes to first-time buyers [11] - Long-term outlook for the housing market remains positive, driven by supply-demand imbalance and favorable demographic trends [11] - The company plans to continue investing in people, land, and operating platforms to support long-term strategy [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the dynamic market environment, with affordability being a primary pressure point [5] - The expectation for 2026 includes closing between 4,600 and 5,400 homes, with stable selling prices [23] - Management indicated that incentives will continue to be utilized to support affordability while maintaining margin discipline [23] Other Important Information - The company ended the year with $1.7 billion of debt outstanding and a net debt to capital ratio of 43.2% [20] - Total liquidity at year-end was $335 million, including over $61 million in cash [20] - The average finished lot cost is approximately $70,000, representing about 21% of the average selling price [18] Q&A Session Summary Question: Drivers of sequential decline in gross margin in Q4 - Management indicated that the decline was due to increased incentives and discounts on aged inventory [26][27] Question: Closings outlook for 2026 - Management expects a similar closings pace in 2026, with wholesale closings projected to be 10%-15% of total closings [29][31] Question: Profitability on wholesale orders - Management stated that gross margins on wholesale sales are lower, but operating margins are similar to retail [36] Question: Community count growth expectations for 2026 - New community openings are expected to be weighted towards the back half of the year [38] Question: Cancellations and reasons for cancellation - The cancellation rate is elevated primarily due to financing challenges faced by buyers [44][45] Question: Mix of first-time versus move-up buyers - The proportion of move-up buyers is increasing due to elevated entry-level price points [50] Question: Current market conditions and discounting - Management noted that affordability pressures remain, with competitors also leaning into incentives [53][54] Question: Year-over-year decline in G&A - Management indicated that G&A run rate for 2026 is expected to be similar to 2025 [56]

Financial Data and Key Metrics Changes - Revenue for Q4 2025 was $474 million, representing a 19.5% sequential increase driven by elevated sales activity [11] - Gross margin before inventory-related charges was over 19%, with an adjusted gross margin of over 22%, although these were below guidance ranges due to the impact of buydowns and price discounts on older inventory [5][6] - Net income for Q4 was $17.3 million, or $0.75 per share, while excluding impairment-related charges, net income was $22.4 million, or $0.97 per share [14] Business Line Data and Key Metrics Changes - In Q4, 1,362 homes were delivered, with 1,301 contributing directly to reported revenue [4] - The average selling price for Q4 closings was $364,000, slightly down compared to the previous year [11] - The wholesale business accounted for 12.1% of Q4 closings, generating significant revenue [11] Market Data and Key Metrics Changes - The cancellation rate increased to 43.3%, attributed to affordability pressures and economic uncertainty [8] - The backlog grew 133% to 1,394 homes, with a value exceeding $501 million, up 112% year-over-year [9] Company Strategy and Development Direction - The company remains focused on managing costs, offering competitive financing options, and delivering affordable homes to first-time buyers [10] - Long-term outlook for the housing market remains positive, driven by supply-demand imbalance and favorable demographic trends [10] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by affordability and rate volatility but expressed confidence in the company's ability to navigate these issues [4] - For 2026, the company expects to close between 4,600 and 5,400 homes, with stable selling prices and continued use of incentives to support affordability [22][23] Other Important Information - The company ended the year with $1.7 billion of debt and a net debt to capital ratio of 43.2% [19] - Total liquidity at year-end was $335 million, including cash on hand and revolver availability [19] Q&A Session Summary Question: Drivers of sequential decline in gross margin in Q4 - Management indicated that the decline was due to increased incentives and discounts on aged inventory, with expectations for similar conditions in 2026 [26][27] Question: Closings outlook for 2026 - Management confirmed expectations for a similar closings pace in 2026, with wholesale business contributing 10%-15% of total closings [28][30] Question: Profitability on wholesale orders - Management stated that operating margins for wholesale business are similar to retail, but gross margins are lower [35] Question: Community count growth expectations for 2026 - New community openings are expected to be weighted towards the back half of the year, with confidence in achieving the community count guidance [37] Question: Cancellations and buyer financing issues - Management noted that cancellations are primarily due to buyers' ability to secure financing, with customers taking longer to close [43][44] Question: Current market conditions and discounting - Management acknowledged ongoing aggressive discounting in the market, with affordability pressures remaining a significant concern [52] Question: Year-over-year decline in G&A - Management indicated that G&A run rate for 2026 is expected to be similar to 2025, with some fluctuations quarter to quarter [55]

Financial Data and Key Metrics Changes - Revenue for Q4 2025 was $474 million, representing a 19.5% sequential increase driven by elevated sales activity [10] - Gross margin before inventory-related charges was over 19%, with an adjusted gross margin of over 22%, both below guidance ranges due to the impact of buydowns and price discounts on older inventory [5][11] - Pre-tax net income was $24 million, or 5.1% of revenue, with net income of $17.3 million, or $0.75 per share [13] Business Line Data and Key Metrics Changes - The company delivered 1,362 homes in Q4, with 1,301 contributing to reported revenue [4] - The average selling price for Q4 closings was $364,000, slightly down from the previous year [10] - The wholesale business accounted for 12.1% of Q4 closings, generating significant revenue [10] Market Data and Key Metrics Changes - The cancellation rate increased to 43.3%, attributed to affordability pressures and economic uncertainty [7] - The backlog grew 133% to 1,394 homes, with a value exceeding $501 million, up 112% year-over-year [8] Company Strategy and Development Direction - The company remains focused on managing costs, offering competitive financing options, and delivering affordable homes to first-time buyers [9] - Long-term outlook for the housing market remains positive, driven by supply-demand imbalance and favorable demographic trends [9] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges of affordability and rate volatility but expressed confidence in the company's ability to navigate these issues [4] - For 2026, the company expects to close between 4,600 and 5,400 homes, with stable selling prices and a focus on maintaining margins [21] Other Important Information - The company ended the year with $1.7 billion in debt and a net debt to capital ratio of 43.2% [19] - Total liquidity at year-end was $335 million, including cash on hand and revolver availability [19] Q&A Session Summary Question: What drove the sequential decline in gross margin in Q4? - Management indicated that the decline was due to increased incentives and discounts on aged inventory, along with competitive pricing pressures [26] Question: What is the outlook for closings in 2026? - Management confirmed expectations for a similar closings pace in 2026, with wholesale closings projected to be 10%-15% of total closings [28] Question: How will profitability be affected by the 480 orders in the wholesale business? - Management stated that while gross margins are lower for wholesale sales, operating margins remain similar to retail [34] Question: What is the current mix of first-time versus move-up buyers? - Management noted an increase in move-up buyers due to elevated entry-level price points, although first-time buyers still dominate [49] Question: What are the current conditions regarding affordability and discounting? - Management acknowledged ongoing affordability challenges and the need for continued incentives to assist buyers [52]

Home Sales Performance - Home sales revenues for Q4 2025 were $474.0 million, with total home closings of 1,362, including 61 leased homes[7] - Home sales revenues for Q4 2025 were $473,967, a decrease of 15% from $557,396 in Q4 2024[20] - Total home closings for the year ended December 31, 2025, were 4,685, a decrease from 6,028 in 2024[23] - The cancellation rate for net orders increased to 32.8% in 2025 from 22.8% in 2024[26] - The ending backlog of homes as of December 31, 2025, was 1,394 homes valued at $501,296, compared to 599 homes valued at $236,511 in 2024[26] Financial Performance - The company reported a net income of $17.3 million for Q4 2025, translating to $0.75 basic and diluted EPS[7] - Net income for the year ended December 31, 2025, was $72,552, down 63% from $196,071 in 2024[20] - Adjusted net income for Q4 2025 was $22,397, compared to $50,870 in Q4 2024[32] - Adjusted diluted earnings per share for the year ended December 31, 2025, was $3.34, down from $8.30 in 2024[32] Margins and Profitability - The average sales price per home closed in Q4 2025 was $364,310, contributing to a gross margin of 17.7%[7] - Gross margin for Q4 2025 was $84,113 thousand, down 34% from $127,511 thousand in Q4 2024, resulting in a gross margin percentage of 17.7% compared to 22.9% in the previous year[34] - Adjusted gross margin for Q4 2025 was $105,875 thousand, a decrease of 24% from $140,295 thousand in Q4 2024, with an adjusted gross margin percentage of 22.3% compared to 25.2% in Q4 2024[34] - Gross margin for 2026 is expected to range between 18.0% and 20.0%, with adjusted gross margin between 21.0% and 23.0%[13] Backlog and Future Projections - The company experienced a 133% increase in backlog due to a wholesale agreement for 480 homes, with year-end backlog up 53% compared to 2024[3] - For 2026, the company projects home closings between 4,600 and 5,400, with an average sales price between $355,000 and $365,000[4] Liquidity and Capital Structure - Total liquidity at year-end 2025 was $334.8 million, including cash and cash equivalents of $61.2 million[12] - The net debt to capital ratio was 43.2% at December 31, 2025, indicating the company's leverage position[12] - Total debt as of December 31, 2025, was $1,656,803 thousand, an increase from $1,480,718 thousand in 2024, resulting in a debt to capital ratio of 44.1% compared to 42.1% in 2024[37] - The net debt to capital ratio for December 31, 2025, was 43.2%, up from 41.2% in 2024, indicating increased leverage in the company's operations[37] Inventory and Land Management - Active selling communities at the end of 2025 numbered 144, with total owned and controlled lots at 60,842[12] - The company had 51,890 owned lots as of December 31, 2025, with 35,416 being raw/under development lots[25] - Inventory impairment for the year ended December 31, 2025, was $6,717 thousand, with no impairment recorded in 2024[34] - Capitalized interest charged to cost of sales for Q4 2025 was $14,436 thousand, compared to $11,884 thousand in Q4 2024[34] Capital Management - The company continues to monitor its capital efficiency and evaluate the effectiveness of its capital management strategies over time[36]