SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 27, 2014
NVR, Inc.
(Exact name of registrant as specified in its
charter)
| Virginia | 1-12378 | 54-1394360 |
| (State or other jurisdiction of | (Commission File | (I.R.S. Employer |
| incorporation or organization) | Number) | Identification No.) |
| 11700 Plaza America Drive, Suite 500, Reston, Virginia | 20190 |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: 703-956-4000
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.133-4(c))
| Item 2.02 | Results of Operations and Financial Condition |
On January 27, 2014, NVR, Inc. issued a press release reporting its financial results for the quarter and year to date periods ended December 31, 2013. A copy of this press release is furnished herewith as Exhibit 99.1.
| Item 9.01 | Financial Statements and Exhibits |
| (c) | Exhibits |
| Number | Description |
| 99.1 | Press release dated January 27, 2014. |
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 hereunto duly authorized.
| NVR, Inc. | ||
| Date: January 27, 2014 | By: | /s/ Daniel D. Malzahn |
Name: Title:
|
Daniel
D. Malzahn Vice President, Chief Financial Officer and Treasurer | |
INDEX TO EXHIBITS
| Exhibit Number | Exhibit Description |
| 99.1. | Press release dated January 27, 2014 |
NVR, Inc. Announces Fourth Quarter And Full Year Results
RESTON, Va., Jan. 27, 2014 /PRNewswire/ -- NVR, Inc. (NYSE: NVR), one of the nation's largest homebuilding and mortgage banking companies, announced net income for its fourth quarter ended December 31, 2013 of $97,811,000, $21.15 per diluted share. Net income and diluted earnings per share for its fourth quarter ended December 31, 2013 increased 61% and 77%, respectively, when compared to the 2012 fourth quarter. Consolidated revenues for the fourth quarter of 2013 totaled $1,242,152,000, a 32% increase from $943,738,000 for the comparable 2012 quarter.
For the year ended December 31, 2013, consolidated revenues were $4,211,267,000, an increase of 32% from the $3,184,650,000 reported for the year ended December 31, 2012. Net income for the year ended December 31, 2013 was $266,477,000, an increase of 48% when compared to the year ended December 31, 2012. Diluted earnings per share for the year ended December 31, 2013 was $54.81, an increase of 56% from $35.12 per diluted share for the comparable period of 2012.
Homebuilding
New orders in the fourth quarter of 2013 were 2,631 units, which was flat when compared to 2,625 units in the fourth quarter of 2012. The cancellation rate in the fourth quarter of 2013 was 14% compared to 15% in the fourth quarter of 2012 and 19% in the third quarter of 2013. Settlements increased in the fourth quarter of 2013 to 3,342 units, 20% higher than the same period in 2012. The Company's backlog of homes sold but not settled as of December 31, 2013 was down 1% on a unit basis to 4,945 units but was 7% higher on a dollar basis to $1,845,600,000 when compared to December 31, 2012.
Homebuilding revenues for the three months ended December 31, 2013 totaled $1,223,808,000, 32% higher than the year earlier period. Gross profit margin in the fourth quarter of 2013 was 18.2% compared to 18.3% in the fourth quarter of 2012 and 17.4% in the third quarter of 2013. Gross profit margin in the current quarter was negatively impacted by a $15,964,000 expense to increase the warranty accrual for a non-recurring service issue. This is unrelated to the warranty accrual increase recognized in the second quarter. Excluding this charge, gross profit margin for the fourth quarter of 2013 was 19.5%. Income before tax from the homebuilding segment totaled $143,976,000 in the 2013 fourth quarter, an increase of 67% when compared to the fourth quarter of 2012. The fourth quarter 2013 pre-tax income results also reflect a reversal of approximately $7,450,000 of stock-based compensation expense due to an adjustment to the Company's estimated forfeiture rate based on actual forfeiture experience.
New orders for the 2013 fiscal year increased 8% to 11,800 units, when compared to 10,954 units in fiscal year 2012. Home settlements in 2013 increased 20% to 11,834 units from 9,843 units settled in 2012. Homebuilding revenues for 2013 totaled $4,134,481,000, 32% higher than 2012. Pre-tax homebuilding income for the 2013 fiscal year was $379,370,000, a 57% increase when compared to 2012.
Mortgage Banking
Mortgage closed loan production of $721,926,000 for the three months ended December 31, 2013 was 12% higher than the same period in 2012. Operating income for the mortgage banking operations during the fourth quarter of 2013 decreased 19% to $7,844,000 when compared to $9,728,000 reported for the same period of 2012. The decrease in the operating income was attributable to an increase in general and administrative costs resulting from increased headcount in the current year.
Mortgage closed loan production for the 2013 fiscal year increased 15% to $2,538,072,000. Income before tax from the mortgage banking segment for 2013 increased 15% to $39,326,000 from $34,153,000 in 2012.
About NVR
NVR, Inc. operates in two business segments: homebuilding and mortgage banking. The homebuilding unit sells and builds homes under the Ryan Homes, NVHomes, Fox Ridge Homes and Heartland Homes trade names, and operates in twenty-seven metropolitan areas in fourteen states and Washington, D.C. For more information about NVR, Inc. and its brands, see www.nvrinc.com, www.ryanhomes.com, www.nvhomes.com, www.foxridgehomes.com and www.heartlandluxuryhomes.com.
Some of the statements in this release made by the Company constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as "believes," "expects," "may," "will," "should" or "anticipates" or the negative thereof or other comparable terminology. All statements other than of historical facts are forward-looking statements. Forward-looking statements contained in this document may include those regarding market trends, NVR's financial position, business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of NVR to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements. Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by NVR and NVR's customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by NVR in its homebuilding operations; shortages of labor; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which NVR has little or no control. NVR undertakes no obligation to update such forward-looking statements except as required by law.
NVR, Inc.
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| Three Months Ended December 31, |
| Twelve Months Ended December 31, | ||||
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| 2013 |
| 2012 |
| 2013 |
| 2012 |
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|
| (Unaudited) |
| (Unaudited) |
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Homebuilding: |
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| Revenues |
| $ 1,223,808 |
| $ 925,363 |
| $ 4,134,481 |
| $ 3,121,244 | |
|
| Other income |
| 808 |
| 1,441 |
| 3,962 |
| 3,486 | |
|
| Cost of sales |
| (1,001,415) |
| (756,396) |
| (3,424,204) |
| (2,575,639) | |
|
| Selling, general and administrative |
| (73,599) |
| (78,701) |
| (313,029) |
| (301,184) | |
|
|
| Operating income |
| 149,602 |
| 91,707 |
| 401,210 |
| 247,907 |
|
| Interest expense |
| (5,626) |
| (5,404) |
| (21,840) |
| (6,983) | |
|
|
| Homebuilding income |
| 143,976 |
| 86,303 |
| 379,370 |
| 240,924 |
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Mortgage Banking: |
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| Mortgage banking fees |
| 18,344 |
| 18,375 |
| 76,786 |
| 63,406 | |
|
| Interest income |
| 1,585 |
| 999 |
| 4,983 |
| 4,504 | |
|
| Other income |
| 187 |
| 191 |
| 696 |
| 564 | |
|
| General and administrative |
| (12,135) |
| (9,746) |
| (42,594) |
| (33,775) | |
|
| Interest expense |
| (137) |
| (91) |
| (545) |
| (546) | |
|
|
| Mortgage banking income |
| 7,844 |
| 9,728 |
| 39,326 |
| 34,153 |
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Income before taxes |
| 151,820 |
| 96,031 |
| 418,696 |
| 275,077 | ||
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| Income tax expense |
| (54,009) |
| (35,404) |
| (152,219) |
| (94,489) |
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Net income |
| $ 97,811 |
| $ 60,627 |
| $ 266,477 |
| $ 180,588 | ||
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Basic earnings per share |
| $ 21.74 |
| $ 12.38 |
| $ 56.25 |
| $ 36.04 | ||
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Diluted earnings per share |
| $ 21.15 |
| $ 11.98 |
| $ 54.81 |
| $ 35.12 | ||
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Basic weighted average shares outstanding |
| 4,500 |
| 4,897 |
| 4,737 |
| 5,011 | ||
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Diluted weighted average shares outstanding | 4,626 |
| 5,060 |
| 4,862 |
| 5,142 | |||
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NVR, Inc.
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| December 31, 2013 |
| December 31, 2012 |
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| (Unaudited) |
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ASSETS |
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Homebuilding: |
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| Cash and cash equivalents |
| $ 844,274 |
| $ 1,139,103 | ||
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| Receivables |
| 9,529 |
| 9,421 | ||
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| Inventory: |
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| Lots and housing units, covered under |
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| sales agreements with customers |
| 568,831 |
| 515,498 |
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| Unsold lots and housing units |
| 117,467 |
| 81,932 | |
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| Land under development |
| 41,328 |
| 68,336 | |
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| Manufacturing materials and other |
| 10,939 |
| 12,365 | |
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| 738,565 |
| 678,131 |
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| Assets related to consolidated variable interest entity | 7,268 |
| 15,626 | |||
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| Contract land deposits, net |
| 236,885 |
| 191,538 | ||
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| Property, plant and equipment, net |
| 32,599 |
| 27,016 | ||
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| Reorganization value in excess of amounts |
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| allocable to identifiable assets, net |
| 41,580 |
| 41,580 | |
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| Goodwill and finite-lived intangible assets, net |
| 6,747 |
| 9,219 | ||
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| Other assets |
| 307,933 |
| 270,636 | ||
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| 2,225,380 |
| 2,382,270 |
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Mortgage Banking: |
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| Cash and cash equivalents |
| 21,311 |
| 13,498 | ||
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| Mortgage loans held for sale, net |
| 210,641 |
| 188,929 | ||
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| Property and equipment, net |
| 4,699 |
| 2,465 | ||
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| Reorganization value in excess of amounts |
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| allocable to identifiable assets, net |
| 7,347 |
| 7,347 | |
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| Other assets |
| 16,770 |
| 10,333 | ||
|
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|
| 260,768 |
| 222,572 |
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| Total assets |
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| $ 2,486,148 |
| $ 2,604,842 |
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LIABILITIES AND SHAREHOLDERS' EQUITY |
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Homebuilding: |
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| Accounts payable |
| $ 181,687 |
| $ 163,446 | ||
|
| Accrued expenses and other liabilities |
| 316,227 |
| 234,804 | ||
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| Liabilities related to consolidated variable interest entity | 1,646 |
| 2,180 | |||
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| Non-recourse debt related to consolidated variable interest entity |
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| 3,365 |
| 4,574 | |
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| Customer deposits |
| 101,022 |
| 99,687 | ||
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| Senior notes |
| 599,075 |
| 598,988 | ||
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| 1,203,022 |
| 1,103,679 |
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Mortgage Banking: |
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| Accounts payable and other liabilities |
| 21,774 |
| 20,686 | ||
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| 21,774 |
| 20,686 |
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| Total liabilities |
| 1,224,796 |
| 1,124,365 | |
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Commitments and contingencies |
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Shareholders' equity: |
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| Common stock, $0.01 par value; 60,000,000 shares |
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| authorized; and 20,555,330 and 20,556,198 |
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| shares issued as of December 31, 2013 and |
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| December 31, 2012, respectively |
| 206 |
| 206 | |
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| Additional paid-in-capital |
| 1,212,050 |
| 1,169,699 | ||
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| Deferred compensation trust – 109,256 and |
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| 152,223 shares of NVR, Inc. common |
|
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| stock as of December 31, 2013 and |
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| December 31, 2012, respectively |
| (17,741) |
| (25,331) | |
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| Deferred compensation liability |
| 17,741 |
| 25,331 | ||
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| Retained earnings |
| 4,605,557 |
| 4,339,080 | ||
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| Less treasury stock at cost – 16,121,605 and |
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| 15,642,068 shares at December 31, 2013 |
|
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| and December 31, 2012, respectively |
| (4,556,461) |
| (4,028,508) | |
|
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| Total shareholders' equity |
| 1,261,352 |
| 1,480,477 | |
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| Total liabilities and shareholders' equity | $ 2,486,148 |
| $ 2,604,842 | ||
NVR, Inc.
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| Three Months Ended December 31, |
| Twelve Months Ended December 31, | |||||
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| 2013 |
| 2012 |
| 2013 |
| 2012 | |
Homebuilding data: |
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| New orders (units) |
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| Mid Atlantic (1) | 1,445 |
| 1,418 |
| 6,056 |
| 5,757 | |
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| North East (2) | 243 |
| 234 |
| 1,075 |
| 946 | |
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| Mid East (3) | 578 |
| 574 |
| 2,903 |
| 2,625 | |
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| South East (4) | 365 |
| 399 |
| 1,766 |
| 1,626 | |
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| Total | 2,631 |
| 2,625 |
| 11,800 |
| 10,954 | |
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| Average new order price | $ 375.7 |
| $ 340.2 |
| $ 360.4 |
| $ 328.8 | ||
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| Settlements (units) |
|
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| Mid Atlantic (1) | 1,698 |
| 1,427 |
| 6,029 |
| 5,047 | |
|
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| North East (2) | 299 |
| 224 |
| 1,013 |
| 889 | |
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| Mid East (3) | 818 |
| 733 |
| 3,023 |
| 2,472 | |
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| South East (4) | 527 |
| 404 |
| 1,769 |
| 1,435 | |
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| Total | 3,342 |
| 2,788 |
| 11,834 |
| 9,843 | |
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| Average settlement price | $ 365.3 |
| $ 331.9 |
| $ 349.1 |
| $ 317.1 | ||
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| Backlog (units) |
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| Mid Atlantic (1) |
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| 2,710 |
| 2,683 | |
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| North East (2) |
|
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| 495 |
| 433 | |
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| Mid East (3) |
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| 1,032 |
| 1,152 | |
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| South East (4) |
|
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| 708 |
| 711 | |
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| Total |
|
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| 4,945 |
| 4,979 | |
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| Average backlog price |
|
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| $ 373.2 |
| $ 346.2 | ||
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| |
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| Community count (average) | 462 |
| 414 |
| 451 |
| 404 | ||
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| Lots controlled at end of period |
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| 64,600 |
| 58,500 | ||
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Mortgage banking data: |
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| Loan closings | $ 721,926 |
| $ 642,171 |
| $ 2,538,072 |
| $ 2,206,092 | ||
|
| Capture rate | 78% |
| 87% |
| 81% |
| 87% | ||
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Common stock information: |
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| Shares outstanding at end of period |
|
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| 4,433,725 |
| 4,914,130 | ||
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| Number of shares repurchased | 126,605 |
| 8,500 |
| 581,387 |
| 285,495 | ||
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| Aggregate cost of shares repurchased | $ 118,682 |
| $ 7,153 |
| $ 554,491 |
| $ 227,281 | ||
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(1) | Virginia, West Virginia, Maryland, Delaware and Washington, D.C. |
(2) | New Jersey and eastern Pennsylvania |
(3) | New York, Ohio, western Pennsylvania, Indiana and Illinois |
(4) | North Carolina, South Carolina, Tennessee and Florida |
CONTACT: Curt McKay, Office: (703) 956-4058