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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended September 30, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXHANGE ACT OF 1934.
FOR THE TRANSITION PERIOD__________ TO __________.
Commission File No. 1-6830
ORLEANS HOMEBUILDERS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 59-0874323
- ------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
One Greenwood Square, Suite 101
3333 Street Road
Bensalem, PA 19020
(Address of principal executive offices)
Telephone: (215) 245-7500
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act). Yes No X
Number of shares of common stock, par value $0.10 per share, outstanding as of
November 4, 2003: 12,667,565
(excluding 697,232 shares held in Treasury).
ORLEANS HOMEBUILDERS, INC. AND SUBSIDIARIES
PAGE
----
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
Consolidated Balance Sheets at September 30, 2003
and June 30, 2003 1
Consolidated Statements of Operations and Changes
in Retained Earnings for the Three Months
Ended September 30, 2003 and 2002 2
Consolidated Statements of Shareholders' Equity for the
Three Months Ended September 30, 2003 3
Consolidated Statements of Cash Flows for the Three
Months Ended September 30, 2003 and 2002 4
Notes to Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 12
Item 3. Quantitative and Qualitative Disclosures About Market
Risk 21
Item 4. Controls and Procedures 21
PART II - OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds 22
Item 6. Exhibits and Reports on Form 8-K 22
Orleans Homebuilders, Inc. and Subsidiaries
Consolidated Balance Sheets
(in thousands)
(Unaudited)
September 30, June 30,
2003 2003
---------------- -------------
Assets
Cash and cash equivalents $ 9,223 $ 8,883
Restricted cash - customer deposits 16,852 15,065
Real estate held for development and sale:
Residential properties completed or under construction 135,396 109,895
Land held for development or sale and improvements 106,704 100,791
Inventory not owned - Variable Interest Entity 24,478 18,443
Property and equipment, at cost, less accumulated depreciation 1,396 2,428
Deferred taxes 233 233
Intangible assets, net of amortization 6,807 4,180
Receivables, deferred charges and other assets 33,623 30,791
----------- -----------
Total Assets $ 334,712 $ 290,709
=========== ===========
Liabilities and Shareholders' Equity
Liabilities:
Accounts payable $ 25,194 $ 29,306
Accrued expenses 26,726 27,445
Customer deposits 21,443 16,539
Obligations related to inventory not owned 23,203 17,643
Mortgage and other note obligations primarily secured by real
estate held for development and sale 133,777 106,707
Notes payable - related parties 5,920 2,500
Other notes payable 100 31
------------ -----------
Total Liabilities 236,363 200,171
------------ -----------
Commitments and contingencies
Redeemable common stock 828 999
------------ -----------
Shareholders' Equity:
Preferred stock, $1 par, 500,000 shares authorized:
Series D convertible preferred stock, 7% cumulative annual
dividend, $30 stated value, issued and outstanding 100,000
shares ($3,000,000 liquidation preference) 3,000 3,000
Common stock, $.10 par, 20,000,000 shares authorized,
13,364,797 shares issued 1,337 1,337
Capital in excess of par value - common stock 18,857 18,659
Retained earnings 75,054 67,589
Treasury stock, at cost (697,232 and 727,232 shares held at
September 30, 2003 and June 30, 2003, respectively) (727) (1,046)
------------ -----------
Total Shareholders' Equity 97,521 89,539
------------ -----------
Total Liabilities and Shareholders' Equity $ 334,712 $ 290,709
=========== ===========
See accompanying notes which are an integral part of the
consolidated financial statements.
- 1 -
Orleans Homebuilders, Inc. and Subsidiaries
Consolidated Statements of Operations
and Changes in Retained Earnings
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended
September 30,
2003 2002
--------------- ----------------
Earned revenues
Residential properties $ 98,383 $ 86,030
Land sales 457 -
Other income 1,595 1,088
------------ ------------
100,435 87,118
------------ ------------
Costs and expenses
Residential properties 74,809 66,051
Land sales 490 -
Other 1,223 996
Selling, general and administrative 11,448 9,792
Interest
Incurred 1,814 1,362
Less capitalized (1,742) (1,298)
------------ ------------
88,042 76,903
------------ ------------
Income from operations before income taxes 12,393 10,215
Income tax expense 4,875 3,881
------------ ------------
Net income 7,518 6,334
Preferred dividends 53 53
------------ ------------
Net income available for common shareholders 7,465 6,281
Retained earnings, at beginning of period 67,589 40,502
------------ ------------
Retained earnings, at end of period $ 75,054 $ 46,783
============ ============
Basic earnings per share $ 0.58 $ 0.52
============ ============
Diluted earnings per share $ 0.45 $ 0.38
============ ============
See accompanying notes which are an integral part of the
consolidated financial statements.
- 2 -
Orleans Homebuilders, Inc. and Subsidiaries
Consolidated Statements of Shareholders' Equity
(unaudited)
(dollars in thousands)
Preferred Stock Common Stock Capital in
Shares Shares Excess of
Issued and Issued and Par Value -
Outstanding Amount Outstanding Amount Common Stock
---------------- -------- ------------- -------- --------------
Balance at June 30, 2003 100,000 $ 3,000 13,364,797 $ 1,337 $ 18,659
Redeemable common stock sold 171
Fair market value of stock options issued 27
Treasury stock sold
Net income
Preferred dividends
-------- ------- ---------- ------- --------
Balance at September 30, 2003 100,000 $ 3,000 13,364,797 $ 1,337 $ 18,857
======== ======= ========== ======= ========
[RESTUBBED TABLE]
Treasury Stock
Retained Share
Earnings Held Amount Total
---------------- --------------- -------- ----------
Balance at June 30, 2003 $ 67,589 727,232 $(1,046) $ 89,539
Redeemable common stock sold 171
Fair market value of stock options issued 27
Treasury stock sold (30,000) 319 319
Net income 7,518 7,518
Preferred dividends (53) (53)
-------- ------- ------- --------
Balance at September 30, 2003 $ 75,054 697,232 $ (727) $ 97,521
======== ======= ======= ========
-3-
Orleans Homebuilders, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
Three Months Ended
September 30,
2003 2002
------------ -----------
Cash flows from operating activities:
Net income $ 7,518 $ 6,334
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 131 164
Stock based compensation expense 27 11
Changes in operating assets and liabilities:
Restricted cash - customer deposits (1,787) (1,168)
Real estate held for development and sale (14,659) (1,606)
Receivables, deferred charges and other assets (1,719) (3,997)
Accounts payable and other liabilities (5,924) (796)
Customer deposits 1,984 1,405
------------ -----------
Net cash provided by (used in) operating activities (14,429) 347
------------ -----------
Cash flows from investing activities:
Purchases of property and equipment (57) (281)
Acquisitions, net of cash acquired (4,932) 17
------------ -----------
Net cash used in investing activities (4,989) (264)
------------ -----------
Cash flows from financing activities:
Borrowings from loans secured by real estate assets 75,073 64,489
Repayment of loans secured by real estate assets (58,909) (61,823)
Borrowings from other note obligations 5,424 35
Repayment of other note obligations (2,017) (10)
Sale of treasury stock 240 -
Preferred stock dividend (53) (53)
------------ -----------
Net cash provided by financing activities 19,758 2,638
------------ -----------
Net increase in cash and cash equivalents 340 2,721
Cash and cash equivalents at beginning of year 8,883 7,257
------------ -----------
Cash and cash equivalents at end of period $ 9,223 $ 9,978
============ ===========
Supplemental disclosure of cash flow activities:
Interest paid, net of amounts capitalized $ 72 $ 64
============ ===========
Income taxes paid $ 5,988 $ 4,060
============ ===========
See accompanying notes which are an integral
part of the consolidated financial statements.
- 4 -
ORLEANS HOMEBUILDERS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(A) Summary of Significant Accounting Policies:
The accompanying unaudited consolidated financial statements are
presented in accordance with the requirements for Form 10-Q and do
not include all the disclosures required by generally accepted
accounting principles for complete financial statements. Reference
is made to Form 10-K as of and for the year ended June 30, 2003
for Orleans Homebuilders, Inc. and subsidiaries (the "Company")
for additional disclosures, including a summary of the Company's
accounting policies.
On July 28, 2003, the Company acquired all of the issued and
outstanding shares of Masterpiece Homes, Inc. ("Masterpiece").
Unless otherwise indicated, the term the "Company" includes the
accounts of Masterpiece. Masterpiece is engaged in residential
real estate development in central Florida. The Consolidated
Statements of Operations and Changes in Retained Earnings and the
Consolidated Statements of Cash Flows include the accounts of
Masterpiece from July 28, 2003 through September 30, 2003. The
Consolidated Balance Sheets include the accounts of Masterpiece as
of September 30, 2003. All material intercompany transactions and
accounts have been eliminated.
In the opinion of management, the consolidated financial
statements contain all adjustments, consisting only of normal
recurring accruals, necessary to present fairly the consolidated
financial position of the Company for the periods presented. The
interim operating results of the Company may not be indicative of
operating results for the full year.
Recent accounting pronouncements:
In June, 2001, the FASB issued SFAS No. 141, "Business
Combinations" ("SFAS No. 141"), which establishes standards for
reporting business combinations entered into after June 30, 2001
and supercedes APB Opinion No. 16, "Business Combinations" and
SFAS No. 38, "Accounting for Preacquisition Contingencies of
Purchased Enterprises". Among other things, SFAS No. 141 requires
that all business combinations be accounted for as purchase
transactions and provides specific guidance on the definition of
intangible assets which require separate treatment. The statement
is applicable for all business combinations entered into after
June 30, 2001 and also requires that companies apply its
provisions relating to intangibles from pre-existing business
combinations.
-5-
In June 2001, the FASB also issued SFAS No. 142, "Goodwill and
Other Intangible Assets" ("SFAS No. 142"), which establishes
standards for financial accounting and reporting for intangible
assets acquired individually or with a group of other assets and
for the reporting of goodwill and other intangible assets acquired
in a business acquisition subsequent to initial accounting under
SFAS No. 141. SFAS No. 142 supercedes APB Opinion No.17,
"Intangible Assets" and related interpretations. SFAS No. 142 is
effective for fiscal years beginning after December 15, 2001;
however, companies with fiscal years beginning after March 15,
2001 may elect to adopt the provision of SFAS No. 142 at the
beginning of its new fiscal year. Accordingly, the Company elected
to early adopt SFAS No. 142 effective with the beginning of its
new fiscal year on July 1, 2001. The Company did not recognize any
charge to earnings for the cumulative effect upon adoption
because, at the time, all such intangibles related to the
Company's acquisition of PLC for which no impairment was required
under SFAS No. 142. Upon adoption, such intangibles, which were
being amortized over ten years prior to adoption, are no longer
amortized but continue to be subject to periodic review for
impairment.
In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" ("SFAS No. 144"),
which establishes a single accounting model for the impairment or
disposal of long-lived assets, including discontinued operations.
SFAS No. 144 supersedes SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be
Disposed Of" and APB Opinion No. 30, "Reporting the Results of
Operations - Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions". The provisions of SFAS No. 144 are
effective in fiscal years beginning after December 15, 2001, with
early adoption permitted and, in general, are to be applied
prospectively. The Company adopted SFAS No. 144 effective July 1,
2002 and adoption did not have a material impact on its
consolidated results of operations and financial position.
In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13,
and Technical Corrections" ("SFAS No. 145"). SFAS No. 145 rescinds
SFAS No. 4, "Reporting Gains and Losses from Extinguishment of
Debt" ("SFAS No. 4"), and the amendments to SFAS No. 4, SFAS No.
64, "Extinguishments of Debt made to Satisfy Sinking-Fund
Requirements" ("SFAS No. 64"). Through this rescission, SFAS No.
145 eliminates the requirement (in both SFAS No. 4 and SFAS No.
64) that gains and losses from the extinguishment of debt be
aggregated and, if material, classified as an extraordinary item,
net of the related income tax effect. An entity is not prohibited
from classifying such gains and losses as extraordinary items, so
long as they meet the criteria in paragraph 20 of APB Opinion No.
30, "Reporting the Results of Operations - Reporting the Effects
of Disposal of a Segment of a Business, and Extraordinary, Unusual
and Infrequently Occurring Events and Transactions" ("APB No.
30"). However, due to the nature of the Company's operations it is
not expected that such treatment will be available to the Company.
Any gains or losses on extinguishments of debt that were
previously classified as extraordinary items in prior periods
presented that do not meet the criteria in APB No. 30 for
classification as an extraordinary item will be reclassified to
income from continuing operations. The provisions of SFAS No. 145
are effective for financial statements issued for fiscal years
beginning after May 15, 2002. The Company adopted the provisions
of this statement on July 1, 2002 and adoption did not have a
material impact on the Company's results of operations or
financial position.
-6-
In July 2002, the FASB issued SFAS No. 146 "Accounting for Costs
Associated with Exit or Disposal Activities" ("SFAS No. 146"),
which is effective for exit or disposal activities initiated after
December 31, 2002, with earlier application encouraged. SFAS No.
146 addresses the accounting for costs associated with exit or
disposal activities and nullifies Emerging Issues Task Force Issue
No. 94-3 "Liability Recognition for Certain Employee Termination
Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring)". The Company does not
anticipate a material impact on the results of operations or
financial position from the adoption of SFAS No. 146.
In December 2002, the FASB issued SFAS No. 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure" ("SFAS No.
148") which provides alternative methods of transition for a
voluntary change to the fair value based method of accounting for
stock-based employee compensation and amends the disclosure
requirements of SFAS No. 123. The transition provisions of SFAS
No. 148 are effective for fiscal years ending after December 15,
2002, and the disclosure requirements are effective for interim
periods beginning after December 15, 2002. The Company adopted
SFAS No. 148 effective July 1, 2002. The adoption of SFAS No. 148
did not have a material impact on the financial position or
results of operations of the Company.
In January 2003, the FASB issued FASB Interpretation No. 46
"Consolidation of Variable Interest Entities, an interpretation of
ARB No. 51" ("FIN 46"). A Variable Interest Entity (VIE) is
created when (i) the equity investment at risk is not sufficient
to permit the entity to finance its activities without additional
subordinated financial support from other parties or (ii) equity
holders either (a) lack direct or indirect ability to make
decisions about the entity, (b) are not obligated to absorb
expected losses of the entity or (c) do not have the right to
receive expected residual returns of the entity if they occur. If
an entity is deemed to be a VIE, pursuant to FIN 46, an enterprise
that absorbs a majority of the expected losses of the VIE is
considered the primary beneficiary and must consolidate the VIE.
Fin 46 is effective immediately for VIE's created after January
31, 2003. For VIE's created before January 31, 2003, FIN 46 must
be applied at the end of the first interim or annual period ending
after December 15, 2003.
-7-
Based on the provisions of FIN 46, the Company has concluded that
whenever it enters into an option agreement to acquire land or
lots from an entity and pays a significant non-refundable deposit,
a VIE is created under condition (ii) (b) of the previous
paragraph. The Company has been deemed to have provided
subordinated financial support, which refers to variable interests
that will absorb some or all of an entity's expected theoretical
losses if they occur. For each VIE created the Company will
compute expected losses and residual returns based on the
probability of future cash flows as outlined in FIN 46. If the
Company is deemed to be the primary beneficiary of the VIE it will
consolidate the VIE on its balance sheet. The fair value of the
VIE's inventory will be reported as "Inventory Not Owned -
Variable Interest Entities".
In May 2003, the FASB issued Statement of Financial Accounting
Standards No. 150 "Accounting for Certain Financial Instruments
With Characteristics of Both Liabilities and Equity" ("SFAS No.
150"). This standard requires issuers to classify as liabilities
the following three types of freestanding financial instruments:
(1) mandatorily redeemable financial instruments, (2) obligations
to repurchase the issuer's equity shares by transferring assets;
and (3) certain obligations to issue a variable number of shares.
The Company adopted the provisions of this statement, as required,
on July 1, 2003, and adoption did not have a material impact on
the financial position of the Company.
(B) Acquisitions:
On July 28, 2003, the Company acquired all of the issued and
outstanding shares of Masterpiece and entered into an employment
agreement with the president of Masterpiece. Masterpiece is an
established homebuilder located in Orange City, Florida. The terms
of the stock purchase agreement and employment agreement are as
follows: (i) $3,900,000 in cash, at closing; and (ii) $2,130,000
payable January 1, 2005, unless prior to that date the president
is terminated for cause or terminates his employment without good
reason, as defined in the employment agreement; (iii) sale of
30,000 shares of the Company's common stock at $8 per share with a
put option at the same price, (iv) stock options to purchase
45,000 shares of the Company's common stock at $10.64 per share
vesting equally on December 31, 2004, 2005 and 2006; and (v)
contingent payments representing 25% of Masterpiece's pre-tax
profits for the calendar years ended December 31, 2004, 2005 and
2006. The Company also incurred approximately $297,000 in
acquisition costs to complete this transaction.
-8-
The Company accounted for these transactions in accordance with
SFAS No. 141, "Business Combinations", whereby certain of these
amounts were considered to be part of the purchase price of the
business and the remainder part of employee compensation. With
respect to the amounts allocated to the purchase, such amount was
allocated to the fair value of assets and liabilities acquired
with the excess of approximately $2,627,000 allocated to
intangible assets and goodwill.
If the Masterpiece acquisition occurred on July 1, 2002, unaudited
pro forma information for the company would have been as follows:
Three Months Ended September 30,
2003 2002
------ ------
(in thousands,
except per share amounts)
Revenue $100,973 $92,753
Income from operations 12,391 10,329
Net income 7,464 6,352
Earnings per share:
Basic 0.58 0.53
Diluted 0.45 0.39
-9-
(C) Earnings Per Share:
The weighted average number of shares used to compute basic
earnings per common share and diluted earnings per common share
and a reconciliation of the numerator and denominator used in the
computation for the three months ended September 30, 2003 and
2002, respectively, are shown in the following table:
Three Months Ended
September 30,
2003 2002
-----------------------
(Unaudited)
(in
thousands)
Total common shares issued 13,365 12,698
Shares not issued, but
unconditionally issuable 136 205
Less: Average treasury shares outstanding (706) (812)
------- ------
Basic EPS shares 12,795 12,091
Effect of assumed shares issued under
treasury stock method for stock options 553 553
Effect of assumed conversion of
Convertible Subordinated 7% Note 1,333 2,000
Effect of assumed conversion of
Series D Preferred Stock 2,000 2,000
------- ------
Diluted EPS shares 16,681 16,644
======= ======
Net income available for common shareholders $ 7,465 $ 6,281
Effect of assumed conversion of
Convertible Subordinated 7% Note 22 33
Effect of assumed conversion of
Series D Preferred Stock 53 53
------- ------
Adjusted net income for diluted EPS $ 7,540 $ 6,367
======= ======
-10-
(D) Supplemental Cash Flow Disclosure:
Non-cash assets acquired and liabilities assumed as a result of
the Masterpiece acquisition were approximately $17,378,000 and
$14,994,000, respectively.
(E) Residential Properties Completed or under Construction:
Residential properties completed or under construction consist of
the following:
June 30,
September 30, 2003 2003
------------------- -------------
(Unaudited)
(in thousands)
Under contract for sale $ 97,900 $ 76,303
Unsold 37,496 33,592
------------ ------------
$ 135,396 $ 109,895
============ ============
(F) Litigation:
From time to time the Company is named as a defendant in legal
actions arising from its normal business activities. Although the
amount of liability that could arise with respect to currently
pending actions cannot be accurately predicted, in the opinion of
the Company any such liability will not have a material adverse
effect on the financial position, operating results or cash flows
of the Company.
-11-
ORLEANS HOMEBUILDERS, INC. AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Orleans Homebuilders, Inc. and its subsidiaries (collectively, the
"Company", "OHB" or "Orleans") are currently engaged in residential real estate
development in Florida, New Jersey, North Carolina, Pennsylvania, South Carolina
and Virginia. The Company has operated in the Pennsylvania and New Jersey areas
for over 80 years and began operations in North Carolina, South Carolina and
Virginia in fiscal 2001 through the acquisition of Parker & Lancaster
Corporation ("PLC"), a privately-held residential homebuilder. On July 28, 2003,
the Company began operations in Florida through the acquisition of Masterpiece
Homes, Inc. ("Masterpiece"), an established privately-held homebuilder located
in Orange City, Florida. The Results of Operations include the activity of
Masterpiece from July 28, 2003 through September 30, 2003. Unless otherwise
indicated, the term the "Company" includes the accounts of Masterpiece.
References to a given fiscal year in this Quarterly Report on Form 10-Q are to
the fiscal year ending June 30th of that year. For example, the phrases "fiscal
2003" or "2003 fiscal year" refer to the fiscal year ended June 30, 2003.
Results of Operations
The following table (unaudited) sets forth certain details as to
residential sales activity. The information provided is for the three months
ended September 30, 2003 and 2002 in the case of revenues earned and new orders,
and as of September 30, 2003 and 2002 in the case of backlog.
Three Months Ended September 30,
2003 2002
------------------------------- -------------------------------
(Dollars in thousands)
Average Average
Amount Homes Price Amount Homes Price
--------- ------- -------- -------- -------- ---------
Northern Region
New Jersey and Pennsylvania:
Revenues earned $ 53,020 140 $ 379 $ 62,069 205 $ 303
New orders 62,555 146 428 74,650 213 350
Backlog 199,469 468 426 163,205 475 344
Southern Region
North Carolina, South Carolina
and Virginia:
Revenues earned $ 34,416 111 $ 310 $ 23,961 91 $ 263
New orders 56,038 167 336 36,273 126 288
Backlog 117,455 346 339 67,752 215 315
Florida Region (1)
Revenues earned $ 10,947 84 $ 130 $ - - $ -
New orders 12,449 88 141 - - -
Backlog 43,164 302 143 - - -
-12-
Three Months Ended September 30,
2003 2002
-------------------------------- ---------------------------------
(Dollars in thousands)
Average Average
Amount Homes Price Amount Homes Price
-------- ------ ------- -------- ----- -------
Combined Regions
Revenues earned $ 98,383 335 $ 294 $ 86,030 296 $ 291
New orders 131,042 401 327 110,923 339 327
Backlog 360,088 1,116 323 230,957 690 335
(1) Information on revenue earned and new orders is for the period
beginning July 28, 2003, the date the Company entered this market
through its acquisition of Masterpiece, through September 30, 2003.
Three Months Ended September 30, 2003 and 2002
Orders and Backlog
The dollar value of new orders for the three months ended September 30,
2003 increased $20,119,000, or 18.1%, to $131,042,000 on 401 homes, compared to
$110,923,000 on 339 homes for the three months ended September 30, 2002. The
increase in new order dollars is attributable to an increase in southern region
new order dollars of $19,765,000, or 54.5% when compared to the comparable
quarter of the prior fiscal year and an increase in Florida region new order
dollars of $12,449,000 due to the Company's expansion into the Florida region
through its acquisition of Masterpiece. This increase was offset by a decrease
in northern region new order dollars of $12,095,000. New order dollars decreased
in the northern region due to delays in the opening of new communities as a
result of increasingly restrictive regulations and moratoriums by governments
which the Company believes is due to the intensity of development in recent
years. The average price per home of new orders remains strong with increases in
the northern region and southern region of approximately 22% and 17%,
respectively, compared with the prior year comparable quarter. This increase in
the average price per home of new orders on a regional basis is due to the
Company's mix of product offerings as well as sales price increases in the
majority of communities open during the first quarter of fiscal 2004 when
compared with the same communities and products offered for sale in the prior
comparable quarter.
Overall the number of new orders for the first quarter of fiscal 2004
increased by 62 homes, or 18.3%, to 401 homes compared to 339 homes in the prior
year first quarter. In the northern region the number of new orders for the
first quarter of fiscal 2004 decreased to 146 homes from 213 homes in the first
quarter of fiscal 2003 due to delays in the opening of new communities as a
result of increasingly restrictive regulations and moratoriums by governments
which the Company believes is due to the intensity of development in recent
years. In the southern region the number of new orders for the first quarter of
fiscal 2004 increased to 167 homes from 126 homes in the first quarter of fiscal
2003 as the Company continues to expand in this region as a result of its
October 2000 acquisition of PLC. In addition the Company's expansion into
Florida through the acquisition of Masterpiece accounted for an increase in 88
new home orders for the first quarter of fiscal 2004.
-13-
The dollar backlog at September 30, 2003 increased $129,131,000, or
55.9%, to $360,088,000 on 1,116 homes compared to the backlog at September 30,
2002 of $230,957,000 on 690 homes. The increase in backlog and backlog dollars
is attributable to an increase in new orders, the Company's obtaining additional
backlog of $41,662,000 through its acquisition of Masterpiece on July 28, 2003
and favorable economic conditions for the homebuilding industry in the regions
where the Company operates. These favorable economic conditions, most notably
favorable financing conditions, have resulted in positive home pricing trends
and consistent customer demand.
Operating Revenues
Earned revenues for the first quarter ended September 30, 2003
increased $13,317,000 to $100,435,000, or 15.3%, compared to the first quarter
ended September 30, 2002. Revenues from the sale of residential homes included
335 homes totaling $98,383,000 during the first quarter of fiscal 2004, as
compared to 296 homes totaling $86,030,000 during the first quarter of fiscal
2003. The increase in residential revenue earned is attributable to an increase
in southern region residential revenue earned of $10,455,000, or 43.6% when
compared to the comparable quarter of the prior fiscal year and an increase in
Florida region residential revenue earned of $10,947,000 due to the Company's
expansion into the Florida region through its acquisition of Masterpiece. This
increase was offset by a decrease in northern region residential revenue earned
of $9,049,000 when compared with the comparable quarter of the prior year.
Residential revenue earned decreased in the northern region due to weather
related construction delays for new orders received during the Company's fourth
quarter of fiscal 2003. Construction delays are a result of a remarkably rainy
Spring and Summer season with reported precipitation amounts that are
significantly above normal. In addition, residential revenue earned has also
decreased due to delays in the opening of new communities as a result of
increasingly restrictive regulations and moratoriums by governments. The average
price per home delivered remains strong with increases in the northern region
and southern region of approximately 25% and 18%, respectively, compared with
the prior year comparable quarter. This increase in the average price per home
delivered is due to the Company's mix of product offerings as well as sales
price increases in the majority of communities open during the first quarter of
fiscal 2004 when compared with the same communities and products offered for
sale in the prior comparable quarter.
Overall, the number of homes delivered for the first quarter of fiscal
2004 increased by 39 homes, or 13.2%, to 335 homes compared to 296 homes in the
prior year first quarter. In the northern region, the number of homes delivered
for the first quarter of fiscal 2004 decreased to 140 homes from 205 homes in
the first quarter of fiscal 2003 due to weather related construction delays as
noted above. In the southern region, the number of homes delivered for the first
quarter of fiscal 2004 increased to 111 homes from 91 homes in the first quarter
of fiscal 2003 as the Company continues to expand in this region as a result of
its October 2000 acquisition of PLC. In addition, the Company's expansion into
Florida through the acquisition of Masterpiece accounted for an increase in 84
homes delivered for the first quarter of fiscal 2004.
-14-
Costs and Expenses
Costs and expenses for the first three months of fiscal 2004 increased
$11,139,000 to $88,042,000, or 14.5%, compared with the first three months of
fiscal 2003. The cost of residential properties for the first three months of
fiscal 2004 increased $8,758,000 to $74,809,000, or 13.3%, when compared with
the first three months of fiscal 2003. The increase in cost of residential
properties is primarily attributable to increased sales volume resulting from
the Company's expansion into Florida through its acquisition of Masterpiece. The
consolidated gross profit margin increased .8% to 24% for the three months ended
September 30, 2003 compared to a gross profit margin of 23.2% for the three
months ended September 30, 2002. The Company sells a variety of home types in
various communities and regions, each yielding a different gross profit margin.
As a result, depending on the mix of both communities and of home types
delivered, consolidated gross profit margin may fluctuate up or down and may not
be representative of the consolidated gross profit margin for the year.
For the first three months of fiscal 2004, selling, general and
administrative expenses increased $1,656,000 to $11,448,000, or 16.9%, when
compared with the first three months of fiscal 2003. The increase in selling,
general and administrative expenses is primarily due to an increase in Florida
region expenses of $886,000 due to increased sales volume resulting from the
Company's expansion into Florida through its acquisition of Masterpiece on July
28, 2003, and an increase in sales commissions and selling costs in the southern
region of approximately $970,000 as a result of the Company's continued
expansion in this region. These increases were partially offset by a decrease in
sales commissions and selling costs in the northern region as a result of the
corresponding decrease in residential revenue earned in this region.
The selling, general and administrative expenses as a percentage of
residential property revenue increased to 11.6% for the first quarter of fiscal
2004 compared to 11.4% for the first quarter of fiscal 2003. The increase in
selling, general and administrative expenses as a percentage of residential
property revenue is primarily due to the fixed portion of selling, general and
administrative expenses in the northern region compared to a decreased
residential property revenue base in the northern region in the first quarter of
fiscal 2004 when compared with the prior year comparable quarter.
Net Income Available for Common Shareholders
Net income available for common shareholders for the first three months
of fiscal 2004 increased $1,184,000, or 18.9%, to $7,465,000 ($.58 basic and
$.45 diluted earnings per share), compared with $6,281,000 ($.52 basic and $.38
diluted earnings per share) for the first three months of fiscal 2003. This
increase in net income available for common shareholders is attributable to an
increase in gross profit margins primarily as a result of favorable conditions
in the homebuilding industry, resulting in strong customer demand and positive
home pricing trends. The Company's expansion into Florida through its
acquisition of Masterpiece on July 28, 2003 also contributed to the increase in
net income available for common shareholders.
-15-
Liquidity and Capital Resources
On July 28, 2003, the Company acquired all of the issued and
outstanding shares of Masterpiece and entered into an employment agreement with
the president of Masterpiece. Masterpiece is an established homebuilder located
in Orange City, Florida. The terms of the stock purchase agreement and
employment agreement are as follows: (i) $3,900,000 in cash, at closing; and
(ii) $2,130,000 payable January 1, 2005, unless prior to that date the president
is terminated for cause or terminates his employment without good reason, as
defined in the employment agreement; (iii) sale of 30,000 shares of the
Company's common stock at $8 per share with a put option at the same price, (iv)
stock options to purchase 45,000 shares of the Company's common stock at $10.64
per share vesting equally on December 31, 2004, 2005 and 2006; and (v)
contingent payments representing 25% of Masterpiece's pre-tax profits for the
calendar years ended December 31, 2004, 2005 and 2006. To fund the acquisition,
the Company borrowed $2,000,000, at an annual rate of LIBOR plus 4%, from
Jeffrey P. Orleans, Chairman and Chief Executive Officer of the Company, under
its existing unsecured line of credit agreement and used funds from operations
to fund the remaining payments due.
The Company requires capital to purchase and develop land, to construct
units, to fund related carrying costs and overhead and to fund various
advertising and marketing programs to facilitate sales. These expenditures
include site preparation, roads, water and sewer lines, impact fees and
earthwork, as well as the construction costs of the homes and amenities. The
Company's sources of capital include funds derived from operations, sales of
assets and various borrowings, most of which are secured. At September 30, 2003,
the Company had approximately $159,139,000 available under existing secured
revolving and construction loans for planned development expenditures. In
addition, the Company had $2,000,000 available under an existing $4,000,000
unsecured line of credit and working capital arrangement with Jeffrey P.
Orleans, Chairman, Chief Executive Officer and majority shareholder of the
Company.
Net cash used in operating activities for the first quarter of fiscal
2004 was $14,429,000 compared to net cash provided by operating activities for
the prior fiscal year period of $347,000. The increase in net cash used in
operating activities is primarily attributable to an increase in real estate
held for development and sale and a decrease in accounts payable and other
liabilities, partially offset by a decrease in receivables, deferred charges and
other assets and an increase in net income when compared with the prior year
quarter. Net cash used in investing activities for the first quarter of fiscal
2004 was $4,989,000, compared to $264,000 for the prior fiscal year quarter.
This increase is primarily related to the acquisition of Masterpiece on July 28,
2003. Net cash provided by financing activities for the first quarter of fiscal
2004 was $19,758,000, compared to $2,638,000 for the prior fiscal year period.
The increase in net cash provided by financing activities is primarily
attributable to an increase in financing to support the increase in real estate
held for development and to provide financing for the acquisition of
Masterpiece.
-16-
During the three months ended September 30, 2003, the Company acquired
land for future development that should yield approximately 290 building lots.
The aggregate purchase price was approximately $11,968,000.
As of September 30, 2003, the Company had contracted to purchase, or
has under option, land and improved lots for an aggregate purchase price of
approximately $359,851,000 that would yield approximately 8,200 homes. Including
the aforementioned lots, the Company currently controls approximately 10,900
building lots. As of September 30, 2003, the Company had incurred costs
associated with the acquisition and development of these parcels aggregating
$26,495,000, including $12,242,000 of paid deposits. Generally, the Company
structures its land acquisitions so that it has the right to cancel its
agreements to purchase undeveloped land and improved lots by forfeiture of its
deposit under the agreement. Furthermore, purchase of the properties is
contingent upon obtaining all governmental approvals and satisfaction of certain
requirements by the Company and the sellers. The Company expects to utilize
purchase money mortgages, secured financings and existing capital resources to
finance these acquisitions. Contingent on the aforementioned, the Company
anticipates completing a majority of these acquisitions during the next several
years.
The Company believes that funds generated from operations and financing
commitments from available lenders will provide the Company with sufficient
capital to meet its existing operating needs.
Recent Accounting Pronouncements
In June, 2001, the FASB issued SFAS No. 141, "Business Combinations"
("SFAS No. 141"), which establishes standards for reporting business
combinations entered into after June 30, 2001 and supercedes APB Opinion No. 16,
"Business Combinations" and SFAS No. 38, "Accounting for Preacquisition
Contingencies of Purchased Enterprises". Among other things, SFAS No. 141
requires that all business combinations be accounted for as purchase
transactions and provides specific guidance on the definition of intangible
assets which require separate treatment. The statement is applicable for all
business combinations entered into after June 30, 2001 and also requires that
companies apply its provisions relating to intangibles from pre-existing
business combinations.
In June 2001, the FASB also issued SFAS No. 142, "Goodwill and Other
Intangible Assets" ("SFAS No. 142"), which establishes standards for financial
accounting and reporting for intangible assets acquired individually or with a
group of other assets and for the reporting of goodwill and other intangible
assets acquired in a business acquisition subsequent to initial accounting under
SFAS No. 141. SFAS No. 142 supercedes APB Opinion No.17, "Intangible Assets" and
related interpretations. SFAS No. 142 is effective for fiscal years beginning
after December 15, 2001; however, companies with fiscal years beginning after
March 15, 2001 may elect to adopt the provision of SFAS No. 142 at the beginning
of its new fiscal year. Accordingly, the Company elected to early adopt SFAS No.
142 effective with the beginning of its new fiscal year on July 1, 2001. The
Company did not recognize any charge to earnings for the cumulative effect upon
adoption because, at the time, all such intangibles related to the Company's
acquisition of PLC for which no impairment was required under SFAS No. 142. Upon
adoption, such intangibles, which were being amortized over ten years prior to
adoption, are no longer amortized but continue to be subject to periodic review
for impairment.
-17-
In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" ("SFAS No. 144"), which establishes
a single accounting model for the impairment or disposal of long-lived assets,
including discontinued operations. SFAS No. 144 supersedes SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed Of" and APB Opinion No. 30, "Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual and Infrequently Occurring Events and Transactions". The provisions of
SFAS No. 144 are effective in fiscal years beginning after December 15, 2001,
with early adoption permitted and, in general, are to be applied prospectively.
The Company adopted SFAS No. 144 effective July 1, 2002 and adoption did not
have a material impact on its consolidated results of operations and financial
position.
In April 2002, the FASB issued SFAS No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections" ("SFAS No. 145"). SFAS No. 145 rescinds SFAS No. 4, "Reporting
Gains and Losses from Extinguishment of Debt" ("SFAS No. 4"), and the amendments
to SFAS No. 4, SFAS No. 64, "Extinguishments of Debt made to Satisfy
Sinking-Fund Requirements" ("SFAS No. 64"). Through this rescission, SFAS No.
145 eliminates the requirement (in both SFAS No. 4 and SFAS No. 64) that gains
and losses from the extinguishment of debt be aggregated and, if material,
classified as an extraordinary item, net of the related income tax effect. An
entity is not prohibited from classifying such gains and losses as extraordinary
items, so long as they meet the criteria in paragraph 20 of APB Opinion No. 30,
"Reporting the Results of Operations - Reporting the Effects of Disposal of a
Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions" ("APB No. 30"). However, due to the nature of the
Company's operations it is not expected that such treatment will be available to
the Company. Any gains or losses on extinguishments of debt that were previously
classified as extraordinary items in prior periods presented that do not meet
the criteria in APB No. 30 for classification as an extraordinary item will be
reclassified to income from continuing operations. The provisions of SFAS No.
145 are effective for financial statements issued for fiscal years beginning
after May 15, 2002. The Company adopted the provisions of this statement on July
1, 2002 and adoption did not have a material impact on the Company's results of
operations or financial position.
In July 2002, the FASB issued SFAS No. 146 "Accounting for Costs
Associated with Exit or Disposal Activities" ("SFAS No. 146"), which is
effective for exit or disposal activities initiated after December 31, 2002,
with earlier application encouraged. SFAS No. 146 addresses the accounting for
costs associated with exit or disposal activities and nullifies Emerging Issues
Task Force Issue No. 94-3 "Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring)". The Company does not anticipate a material
impact on the results of operations or financial position from the adoption of
SFAS No. 146.
-18-
In December 2002, the FASB issued SFAS No. 148, "Accounting for
Stock-Based Compensation - Transition and Disclosure" ("SFAS No. 148") which
provides alternative methods of transition for a voluntary change to the fair
value based method of accounting for stock-based employee compensation and
amends the disclosure requirements of SFAS No. 123. The transition provisions of
SFAS No. 148 are effective for fiscal years ending after December 15, 2002, and
the disclosure requirements are effective for interim periods beginning after
December 15, 2002. The Company adopted SFAS No. 148 effective July 1, 2002. The
adoption of SFAS No. 148 did not have a material impact on the financial
position or results of operations of the Company.
In January 2003, the FASB issued FASB Interpretation No. 46
"Consolidation of Variable Interest Entities, an interpretation of ARB No. 51"
("FIN 46"). A Variable Interest Entity (VIE) is created when (i) the equity
investment at risk is not sufficient to permit the entity to finance its
activities without additional subordinated financial support from other parties
or (ii) equity holders either (a) lack direct or indirect ability to make
decisions about the entity, (b) are not obligated to absorb expected losses of
the entity or (c) do not have the right to receive expected residual returns of
the entity if they occur. If an entity is deemed to be a VIE, pursuant to FIN
46, an enterprise that absorbs a majority of the expected losses of the VIE is
considered the primary beneficiary and must consolidate the VIE. Fin 46 is
effective immediately for VIE's created after January 31, 2003. For VIE's
created before January 31, 2003, FIN 46 must be applied at the end of the first
interim or annual period ending after December 15, 2003.
Based on the provisions of FIN 46, the Company has concluded that
whenever it enters into an option agreement to acquire land or lots from an
entity and pays a significant non-refundable deposit, a VIE is created under
condition (ii) (b) of the previous paragraph. The Company has been deemed to
have provided subordinated financial support, which refers to variable interests
that will absorb some or all of an entity's expected theoretical losses if they
occur. For each VIE created the Company will compute expected losses and
residual returns based on the probability of future cash flows as outlined in
FIN 46. If the Company is deemed to be the primary beneficiary of the VIE it
will consolidate the VIE on its balance sheet. The fair value of the VIE's
inventory will be reported as "Inventory Not Owned - Variable Interest
Entities".
In May 2003, the FASB issued Statement of Financial Accounting
Standards No. 150 "Accounting for Certain Financial Instruments With
Characteristics of Both Liabilities and Equity" ("SFAS No. 150"). This standard
requires issuers to classify as liabilities the following three types of
freestanding financial instruments: (1) mandatorily redeemable financial
instruments, (2) obligations to repurchase the issuer's equity shares by
transferring assets; and (3) certain obligations to issue a variable number of
shares. The Company adopted the provisions of this statement, as required, on
July 1, 2003, and adoption did not have a material impact on the financial
position of the Company.
-19-
Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private
Securities Litigation Reform Act of 1995
In addition to historical information, this report contains statements
relating to future events or our future results. These statements are
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and are subject to the Safe Harbor provisions created by
statute. Generally words such as "may", "will", "should", "could", "anticipate",
"expect", "intend", "estimate", "plan", "continue", and "believe" or the
negative of or other variation on these and other similar expressions identify
forward-looking statements. These forward-looking statements are made only as of
the date of this report. The Company does not undertake to update or revise the
forward-looking statements, whether as a result of new information, future
events or otherwise.
Forward-looking statements are based on current expectations and
involve risks and uncertainties and the Company's future results could differ
significantly from those expressed or implied by the Company's forward-looking
statements.
Many factors, including those listed below, could cause the Company's
actual consolidated results to differ materially from those expressed in any
forward-looking statements made by, or on behalf of, the Company:
o changes in consumer confidence due to perceived uncertainty of
future employment opportunities and other factors;
o competition from national and local homebuilders in the Company's
market areas;
o changes in price and availability of building material;
o changes in mortgage interest rates charged to buyers of the
Company's homes;
o changes in the availability and cost of financing for the Company's
operations, including land acquisitions;
o revisions in federal, state and local tax laws which provide
incentives for home ownership;
o inability to successfully integrate acquired businesses;
o delays in obtaining land development permits as a result of (i)
federal, state and local environmental and other land development
regulations, (ii) actions taken or failed to be taken by
governmental agencies having authority to issue such permits, and
(iii) opposition from third parties;
-20-
o increased cost of suitable development land; and
o possible liabilities relating to environmental laws or other
applicable regulatory provisions.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk represents the risk of loss that may impact the financial
position, results of operations or cash flows of the Company, due to adverse
changes in financial and commodity market prices and interest rates. The
Company's principal market risk exposure continues to be interest rate risk. A
majority of the Company's debt is variable based on LIBOR and prime rate, and,
therefore, affected by changes in market interest rates. There have been no
material adverse changes to the Company's (1) exposure to risk and (2)
management of these risks, since June 30, 2003.
Item 4. Controls and Procedures
The Company's management, with the participation of the Company's Chief
Executive Officer, President and Chief Operating Officer, and Chief Financial
Officer, evaluated the effectiveness of the Company's disclosure controls and
procedures as of the end of the period covered by this report. Based upon that
evaluation, the Chief Executive Officer, President and Chief Operating Officer
and Chief Financial Officer concluded that the Company's disclosure controls and
procedures are functioning effectively to provide reasonable assurance that
information required to be disclosed by the Company in reports filed under the
Securities Exchange Act of 1934 is recorded, processed, summarized and reported
within the time periods specified in the SEC's rules and forms. There has been
no change in the Company's internal control over financial reporting during the
Company's most recent fiscal quarter that has materially affected, or is
reasonably likely to materially affect, the Company's internal control over
financial reporting.
-21-
PART II. OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds.
In connection with the Company's acquisition of Masterpiece, the
Company sold to Robert Fitzsimmons, a former shareholder and officer of
Masterpiece and current employee of the Company, 30,000 shares of the Company's
common stock, $.10 par value, at a purchase price of $8.00 per share. In
conjunction with the acquisition of the shares of stock, Mr. Fitzsimmons
acquired the right to cause the Company to repurchase the 30,000 shares at $8.00
per share under certain circumstances. Mr. Fitzsimmons' right to cause the
Company to repurchase the shares expires on December 31, 2006, unless earlier
terminated in accordance with the provisions of the Stock Purchase Agreement
among Orleans Homebuilders, Inc., Masterpiece Homes, Inc. and Robert
Fitzsimmons, the David R. Robinson Trust and David Robinson. In addition to the
acquisition of 30,000 shares of the Company's common stock and the associated
right to cause the Company to repurchase the shares, Mr. Fitzsimmons also
acquired options to purchase up to 45,000 additional shares of the Company's
common stock at an exercise price of $10.64 per share. Subject to certain
conditions relating to employment and as further described in the Stock Purchase
Agreement, the options vest in three equal installments on December 31, 2004,
2005, and 2006. Under certain circumstances relating to fundamental transactions
and as further described in the Stock Purchase Agreement, vesting of the options
may be accelerated. The number of shares subject to the options also may be
adjusted to reflect any stock splits, subdivisions, combinations or similar
transactions, as provided in the Stock Purchase Agreement. Mr. Fitzsimmons
acquired the 30,000 shares and the associated right to cause the Company to
repurchase the shares and the 45,000 options on July 28, 2003, the date the
Company acquired Masterpiece.
The Company relied upon the exemption from registration provided by
Section 4(2) of the Securities Act of 1933 as the sale of the securities to Mr.
Fitzsimmons did not involve any public offering. The proceeds of the sale of
stock to Mr. Fitzsimmons were used to partially fund the acquisition of
Masterpiece.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
2.1 Stock Purchase Agreement among Orleans Homebuilders, Inc., Masterpiece Homes, Inc., and Robert Fitzsimmons,
The David R. Robinson Trust and David R. Robinson.*
10.1 Employment Agreement between the Company and Robert Fitzsimmons.**
31.1 Certification of Jeffrey P. Orleans pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification of Michael T. Vesey pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.3 Certification of Joseph A. Santangelo pursuant to Section 302 Sarbanes-Oxley Act of 2002.
32.1 Certification of Jeffrey P. Orleans pursuant to Section 906 Sarbanes-Oxley Act of 2002.
32.2 Certification of Michael T. Vesey pursuant to Section 906 Sarbanes-Oxley Act of 2002.
32.3 Certification of Joseph A. Santangelo pursuant to Section 906 Sarbanes-Oxley Act of 2002.
99.1 Press Release Announcing Results of Operations for the Three Months Ending September 30, 2003.
All Exhibits filed herewith electronically.
* All schedules and exhibits to this Exhibit have been omitted in accordance
with 17 CFR ss.229.601(b)(2). The Registrant agrees to furnish supplementally a
copy of all omitted schedules and exhibits to the Securities and Exchange
Commission upon its request.
** Denotes a management contract or compensatory plan or arrangement required to
be filed as an exhibit.
(b) Reports on Form 8-K.
On August 19, 2003 the Company filed a current report on Form 8-K for
the purpose of filing a press release related to the announcement of fiscal year
2003 financial results and guidance with respect to revenues earned and earnings
per share for fiscal year 2004.
-22-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ORLEANS HOMEBUILDERS, INC.
(Registrant)
November 14, 2003 /s/ Michael T. Vesey
-------------------------------------
Michael T. Vesey
President and Chief Operating Officer
November 14, 2003 /s/ Joseph A. Santangelo
-------------------------------------
Joseph A. Santangelo
Treasurer, Secretary and
Chief Financial Officer
-23-
EXHIBIT INDEX
2.1 Stock Purchase Agreement among Orleans Homebuilders, Inc., Masterpiece Homes, Inc., and Robert Fitzsimmons, The
David R. Robinson Trust and David R. Robinson. *
10.1 Employment Agreement between the Company and Robert Fitzsimmons. **
31.1 Certification of Jeffrey P. Orleans pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification of Michael T. Vesey pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.3 Certification of Joseph A. Santangelo pursuant to Section 302 Sarbanes-Oxley Act of 2002.
32.1 Certification of Jeffrey P. Orleans pursuant to Section 906 Sarbanes-Oxley Act of 2002.
32.2 Certification of Michael T. Vesey pursuant to Section 906 Sarbanes-Oxley Act of 2002.
32.3 Certification of Joseph A. Santangelo pursuant to Section 906 Sarbanes-Oxley Act of 2002.
99.1 Press Release Announcing Results of Operations for the Three Months Ending September 30, 2003.
All Exhibits filed herewith electronically.
* All schedules and exhibits to this Exhibit have been omitted in accordance
with 17 CFR ss.229.601(b)(2). The Registrant agrees to furnish supplementally a
copy of all omitted schedules and exhibits to the Securities and Exchange
Commission upon its request.
** Denotes a management contract or compensatory plan or arrangement required to
be filed as an exhibit.