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| EX-99.1 - EXHIBIT 99.1 GREEN BRICK PARTNERS, INC. EARNINGS RELEASE 3.31.2017 - Green Brick Partners, Inc. | exhibit991grbkearningsrele.htm |
| 8-K - FORM 8-K 3.31.2017 - Green Brick Partners, Inc. | a3312017grbkform8-k.htm |
Green Brick Partners
First Quarter 2017 Investor Call Presentation
May 8, 2017
Exhibit 99.2
1
Forward-looking statements
This presentation and the oral statements made by representatives of the Company during the course of this presentation that are not historical facts are
forward-looking statements. These statements are often, but not always, made through the use of words or phrases such as “may,” “will,” “should,” “could,”
“would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “outlook,” “strategy,” “positioned,” “intends,” “plans,” “believes,” “projects,”
“estimates” and similar expressions, as well as statements in the future tense. Although the Company believes that the assumptions underlying these
statements are reasonable, individuals considering such statements for any purpose are cautioned that such forward-looking statements are inherently
uncertain and necessarily involve risks that may affect the Company’s business prospects and performance, causing actual results to differ from those discussed
during the presentation, and any such difference may be material. Factors that could cause actual results to differ from those anticipated are discussed in the
Company’s annual and quarterly reports filed with the SEC.
Any forward-looking statements made are subject to risks and uncertainties, many of which are beyond management’s control. These risks include the risks
described in the Company’s filings with the SEC. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the
Company’s actual results and plans could differ materially from those expressed in any forward-looking statements.
Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. These forward-looking statements are
made only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new
information or future events.
The Company presents Basic Adjusted EPS and Diluted Adjusted EPS and Basic and Diluted Adjusted weighted-average number of shares outstanding, Income
before taxes attributable to GRBK and Adjusted Homebuilding Gross Margin. The Company believes these and similar measures are useful to management and
investors in evaluating its operating performance and financing structure. The Company also believes these measures facilitate the comparison of their
operating performance and financing structure with other companies in the industry. Because these measures are not calculated in accordance with Generally
Accepted Accounting Principles (“GAAP”), they may not be comparable to other similarly titled measures of other companies and should not be considered in
isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.
Jim Brickman
− Chief Executive Officer
− Over 35 years in real estate development and homebuilding
− Co-founded JBGL with Greenlight Capital in 2008. JBGL was merged into Green Brick
in 2014
− Previously served as Chairman and CEO of Princeton Homes and Princeton Realty Corp.
Rick Costello
− Chief Financial Officer
− Over 25 years of financial and operating experience in all aspects of real estate
management
− Previously served as CFO and COO of GL Homes, as AVP of finance of Paragon Group and
as an auditor for KPMG
Management presenters
2
First quarter 2017 highlights
3
First quarter pre-tax income attributable to Green
Brick of $10.1 million was up 123% from the same
period in 2016
Home closing revenues of $93.4 million in Q1 2017
were up 40% from Q1 2016 on a 40% increase in new
homes delivered
Net new orders of 287 homes in the first quarter of
2017 increased 20% compared to the first quarter of
2016
Last 12 month adjusted homebuilding gross margins
remained at 23.1% through Q1 2017 versus Q4 2016
Homes under construction now stand at 625 homes,
up 16% over Q1 2016
Active selling communities total 52 at March 31, 2017,
up 18% year-over-year
Backlog at March 31, 2017 is now at approximately
$145 million, up 12% from the prior year period
4
Housing starts are highly correlated to jobs and we build in
two of the highest job growth markets.
We are less than 1.5% of the starts in two of the largest housing
markets, giving us significant opportunity for growth.
5
6
Dallas market continues 6-year expansion but
is still well below the prior peak
Dallas/Fort Worth Market
SFD-TH – Starts and Closings
Source: Metrostudy - MetroUSA
7
GRBK has over 3,400 lots in Dallas where the market
continues its 7-year trend of constrained supply
Dallas/Fort Worth Market
Lot Inventory
Source: Metrostudy - MetroUSA
21,616
+14%
20,337
+15%
8
Atlanta market also continues to expand
but is still well below the prior peak
Source: Metrostudy - MetroUSA
73% of activity is in North Atlanta.
GRBK has one of the lowest debt-to-capital
ratios amongst public builders
GRBK net debt to capital is under 10% versus an average 40% for covered public builders
GRBK’s has no off-balance sheet debt embedded in unconsolidated JV’s, unlike many peers
GRBK’s eventual target is approximately 35%
9
Citi Research data for comparative companies is as of December 31, 2016;
“Net Debt” equals Total Debt minus Cash
First quarter 2017 financial highlights
Q1 2017 versus Q1 2016:
- Net new orders increased by 20%
- Home sales revenues increased by 40%
- Home deliveries also increased by 40%
- Dollar value of units in backlog increased by 12%
10
TX
G
Green Brick at a glance
Uniquely structured residential land development and
homebuilding company
− We build and deliver homes through our current
builders in which we own a 50% controlling interest
− We sell lots and provide lot acquisition and vertical
construction financing to our controlled builders
Currently focused on the high growth metropolitan
areas of Dallas and Atlanta
Attractive land position of almost 5,000 well-located
residential lots as of March 31, 2017
− About 81% of our residential lots are owned
− Virtually all of our owned lots are owned at
corporate level vs. at the controlled builder level
Products offered
Townhomes, single family
Single family
Luxury homes
Townhomes,
contractor on luxury homes
Townhomes, single family,
luxury homes
11
Dallas
CB JENI
Normandy Homes
Southgate Homes
Centre Living Homes
Atlanta
The Providence Group
Controlled builders
We are a uniquely structured company that combines residential land development and homebuilding with
strong sponsor ownership and controlling interests in our aligned homebuilders.
Corporate structure
12
50%50%50%50%
100%
Key takeaways
Significant growth opportunities exist in Dallas and
Atlanta ̶ two of the most attractive homebuilder
markets in the U.S.
We have the balance sheet and management team to
support significant growth
Proven success in executing our growth strategy with
our controlled and aligned builders
Our operating model and low leverage results in
superior risk adjusted returns.
13
Non-GAAP Reconciliation
14
Adjusted EPS Reconciliation
(Unaudited, in thousands, except per share amounts)
Three Months Ended
March 31, 2017
Basic adjusted EPS
Net income attributable to Green Brick – basic $6,197
Income tax provision attributable to Green Brick $3,855
Pre-tax income $10,052
Adjusted weighted-average number of shares outstanding – basic 48,958
Basic adjusted EPS $0.21
Diluted adjusted EPS
Net income attributable to Green Brick – diluted $6,197
Income tax provision attributable to Green Brick $3,855
Pre-tax income $10,052
Adjusted weighted-average number of shares outstanding – diluted 49,017
Diluted adjusted EPS $0.21
Non-GAAP Reconciliation (continued)
15
Adjusted Homebuilding Gross Margin Reconciliation
(Unaudited, in thousands)
12 Months
Ended
Mar 31, 2016
12 Months
Ended
Jun 30, 2016
12 Months
Ended
Sep 30, 2016
12 Months
Ended
Dec 31, 2016
12 Months
Ended
Mar 31, 2017
Sale of Residential Units $271,234 $304,597 $323,259 $365,164 $391,933
Homebuilding gross margin $53,396 $60,777 $67,684 $81,710 $87,922
Add back: Capitalized Interest charged to
cost of sales
4,710 4,446 3,483 2,814 2,441
Adjusted homebuilding gross margin $58,106 $65,223 $71,167 $84,524 $90,363
Adjusted gross margin percentage 21.4% 21.4% 22.0% 23.1% 23.1%