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): October 16, 2003
NVR, Inc.
(Exact name of registrant as specified in its charter)
| Virginia | 1-12378 | 54-1394360 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification Number) | ||
7601 Lewinsville Road, Suite 300, McLean, Virginia 22102
(Address of principal executive offices) (Zip code)
Registrant’s telephone number, including area code: 703-761-2000
(Former name or former address, if changed since last report)
Item 7(c). Exhibits
| Exhibit Number |
Exhibit Description | |
| 99.1 |
Press release dated October 16, 2003 |
Item 12. Results of Operations and Financial Condition.
On October 16, 2003, NVR, Inc. issued a press release reporting its financial results for the quarter ended September 30, 2003. A copy of this press release is attached hereto as Exhibit 99.1.
.
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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: October 16, 2003 | By: | /s/ Paul C. Saville | ||
| Name: | Paul C. Saville | |||
| Title: | Executive Vice President, Chief Financial Officer and Treasurer | |||
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INDEX TO EXHIBITS
| Exhibit |
Exhibit Description |
Page | ||
| 99.1 | Press release dated October 16, 2003 | 5 | ||
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NVR, INC. ANNOUNCES A 24% INCREASE IN EARNINGS PER SHARE
FOR THE THIRD QUARTER OF 2003
| FOR IMMEDIATE RELEASE | CONTACT: Paul Columbus | |
| OFFICE: 703-761-2414 |
October 16, 2003 — McLean, VA — NVR, Inc. (AMEX: NVR), one of the nation’s largest homebuilding and mortgage banking companies, today announced that diluted earnings per share for its third quarter ended September 30, 2003 exceeded the 2002 third quarter by 24% and net income increased 19%. Net income for the 2003 third quarter was $109,403,000, $12.55 per diluted share, compared to net income of $91,980,000, $10.14 per diluted share, for the same period of 2002. Net income for the 2003 third quarter was reduced on a pre-tax basis by $8,503,000 ($5,207,000, $0.60 per diluted share, after tax) related to expenses recognized as a result of the redemption of the Company’s $115 million 8% senior notes due 2005 during the quarter. Total revenues increased 13% to $980,380,000 for the quarter when compared to $867,235,000 for the same period of 2002. In addition, the Company reported that new orders for the quarter ended September 2003 were virtually unchanged when compared to the third quarter of 2002. Backlog at the end of the period increased 19% to 7,320 units when compared to the same time last year. The dollar value of the backlog units totaled $2,400,984,000 at the end of the September 2003 quarter, a 31% increase from a year earlier.
Homebuilding revenues for the three months ended September 30, 2003, totaled $956,848,000, 13% higher than the year earlier period. Excluding the debt redemption expenses noted above, income before tax from the homebuilding segment totaled $177,912,000, an increase of 30% when compared to the third quarter of the previous year. Gross profit margins improved to 24.8% for the third quarter of 2003 when compared to 23.8% for the same quarter of 2002.
Pre-tax income from the mortgage banking segment for the 2003 third quarter increased to $15,383,000, 20% higher than the same period of 2002. The Company also reported that closed loan production increased 6% during the September 2003 quarter when compared to the third quarter of 2002.
For the nine months ended September 30, 2003, total revenues for NVR, Inc. were $2,572,455,000, 10% higher than the $2,347,929,000 reported for the same period of 2002. Net income for the nine months ended September 30, 2003, was $292,301,000, $33.53 per diluted share, compared to $252,523,000, $27.16 per diluted share, for the comparable period of 2002, increases of 16% and 23%, respectively.
The Company also reiterated its full year 2003 guidance of approximately 20% growth in net income when compared to 2002. In addition, the Company reported that during the first nine months of 2003 it repurchased approximately 644,000 shares of its common stock.
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. All statements other than of historical facts included herein, including those regarding market trends,
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the Company’s financial position, business strategy, projected plans and objectives of management for future operations, mortgage banking operating income, new order trends, home settlement activity, average home prices, gross profit margins and other profitability measures, net income and earnings per share are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of the Company 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, general economic conditions (on both a national and regional level), interest rate changes, access to suitable financing, competition, the availability and cost of land and other raw materials used by the Company in its homebuilding operations, shortages of labor, weather related slow downs, building moratoria, governmental regulation, the ability of the Company to integrate any acquired business, fluctuation and volatility of stock and other financial markets, and other factors over which the Company has little or no control. The Company has no obligation to update such forward-looking statements.
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NVR, Inc.
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||||
| 2003 |
2002 |
2003 |
2002 |
|||||||||||||||
| Homebuilding: |
||||||||||||||||||
| Revenues |
$ | 956,848 | $ | 847,044 | $ | 2,508,786 | $ | 2,291,936 | ||||||||||
| Other income |
998 | 1,219 | 2,522 | 2,679 | ||||||||||||||
| Cost of sales |
(719,507 | ) | (645,869 | ) | (1,882,154 | ) | (1,744,928 | ) | ||||||||||
| Selling, general and administrative |
(57,002 | ) | (62,474 | ) | (168,401 | ) | (167,954 | ) | ||||||||||
| Operating income |
181,337 | 139,920 | 460,753 | 381,733 | ||||||||||||||
| Loss from extinguishment of |
||||||||||||||||||
| 8% Senior Notes due 2005 |
(8,503 | ) | — | (8,503 | ) | — | ||||||||||||
| Interest expense |
(3,425 | ) | (3,433 | ) | (10,486 | ) | (9,651 | ) | ||||||||||
| Homebuilding income |
169,409 | 136,487 | 441,764 | 372,082 | ||||||||||||||
| Mortgage Banking: |
||||||||||||||||||
| Mortgage banking fees |
20,844 | 17,148 | 56,483 | 48,190 | ||||||||||||||
| Interest income |
1,393 | 1,644 | 3,960 | 4,662 | ||||||||||||||
| Other income |
297 | 180 | 704 | 462 | ||||||||||||||
| General and administrative |
(6,869 | ) | (5,526 | ) | (17,196 | ) | (16,979 | ) | ||||||||||
| Interest expense |
(282 | ) | (617 | ) | (1,091 | ) | (1,408 | ) | ||||||||||
| Mortgage banking income |
15,383 | 12,829 | 42,860 | 34,927 | ||||||||||||||
| Total segment income |
184,792 | 149,316 | 484,624 | 407,009 | ||||||||||||||
| Income tax expense |
(75,389 | ) | (57,336 | ) | (192,323 | ) | (154,486 | ) | ||||||||||
| Net Income |
$ | 109,403 | $ | 91,980 | $ | 292,301 | $ | 252,523 | ||||||||||
| Basic earnings per share |
$ | 15.30 | $ | 12.58 | $ | 41.06 | $ | 34.36 | ||||||||||
| Diluted earnings per share |
$ | 12.55 | $ | 10.14 | $ | 33.53 | $ | 27.16 | ||||||||||
| Basic average shares outstanding |
7,151 | 7,310 | 7,118 | 7,349 | ||||||||||||||
| Diluted average shares outstanding |
8,716 | 9,074 | 8,718 | 9,299 | ||||||||||||||
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NVR, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except per share and share data)
| September 30, 2003 |
December 31, 2002 | |||||
| ASSETS |
(unaudited) | |||||
| Homebuilding: |
||||||
| Cash and cash equivalents |
$ | 220,282 | $ | 139,796 | ||
| Receivables |
15,444 | 10,807 | ||||
| Inventory: |
||||||
| Lots and housing units, covered under sales agreements with customers |
553,545 | 400,008 | ||||
| Unsold lots and housing units |
34,743 | 25,558 | ||||
| Manufacturing materials and other |
5,226 | 11,108 | ||||
| Inventory not owned, consolidated per FIN 46 |
15,462 | — | ||||
| 608,976 | 436,674 | |||||
| Property, plant and equipment, net |
22,151 | 22,126 | ||||
| Reorganization value in excess of amounts allocable to identifiable assets, net |
41,580 | 41,580 | ||||
| Goodwill, net |
6,379 | 6,379 | ||||
| Contract land deposits |
270,962 | 231,229 | ||||
| Other assets |
115,814 | 110,007 | ||||
| 1,301,588 | 998,598 | |||||
| Mortgage Banking: |
||||||
| Cash and cash equivalents |
3,007 | 3,049 | ||||
| Mortgage loans held for sale, net |
130,636 | 163,410 | ||||
| Mortgage servicing rights, net |
158 | 5,611 | ||||
| Property and equipment, net |
873 | 941 | ||||
| Reorganization value in excess of amounts allocable to identifiable assets, net |
7,347 | 7,347 | ||||
| Other assets |
2,868 | 3,332 | ||||
| 144,889 | 183,690 | |||||
| Total assets |
$ | 1,446,477 | $ | 1,182,288 | ||
(Continued)
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NVR, Inc.
Condensed Consolidated Balance Sheets (Continued)
(in thousands, except per share and share data)
| September 30, 2003 |
December 31, 2002 |
|||||||
| (unaudited) | ||||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY |
||||||||
| Homebuilding: |
||||||||
| Accounts payable |
$ | 171,221 | $ | 145,209 | ||||
| Accrued expenses and other liabilities |
208,566 | 240,018 | ||||||
| Liabilities related to inventory not owned, consolidated per FIN 46 |
14,177 | — | ||||||
| Customer deposits |
165,515 | 118,174 | ||||||
| Other term debt |
4,627 | 4,903 | ||||||
| Senior notes |
200,000 | 115,000 | ||||||
| 764,106 | 623,304 | |||||||
| Mortgage Banking: |
||||||||
| Accounts payable and other liabilities |
19,627 | 16,482 | ||||||
| Notes payable |
97,672 | 139,257 | ||||||
|
|
117,299 |
|
155,739 | |||||
| Total liabilities |
881,405 | 779,043 | ||||||
| Commitments and contingencies |
||||||||
| Shareholders’ equity: |
||||||||
| Common stock, $0.01 par value; 60,000,000 shares authorized; 20,597,709 and 20,602,921 shares issued as of September 30, 2003 and December 31, 2002 |
206 | 206 | ||||||
| Additional paid-in-capital |
329,045 | 262,867 | ||||||
| Deferred compensation trust – 453,207 and 428,698 shares as of September 30, 2003 and December 31, 2002, respectively, of NVR, Inc. common stock |
(52,235 | ) | (35,647 | ) | ||||
| Deferred compensation liability |
52,235 | 35,647 | ||||||
| Retained earnings |
1,260,375 | 968,074 | ||||||
| Less treasury stock at cost – 13,514,412 and 13,580,531 shares at September 30, 2003 and December 31, 2002, respectively |
(1,024,554 | ) | (827,902 | ) | ||||
| Total shareholders’ equity |
565,072 | 403,245 | ||||||
| Total liabilities and shareholders’ equity |
$ | 1,446,477 | $ | 1,182,288 | ||||
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NVR, Inc.
Operating Activity
(unaudited)
(dollars in thousands)
| Three Months Ended September 30, |
Nine Months Ended September 30, | |||||||||||
| 2003 |
2002 |
2003 |
2002 | |||||||||
| Homebuilding data: |
||||||||||||
| New orders (units) |
2,492 | 2,502 | 9,511 | 9,125 | ||||||||
| New orders (dollars) |
$ | 797,471 | $ | 723,735 | $ | 2,938,533 | $ | 2,609,383 | ||||
| Settlements (units) |
3,189 | 3,097 | 8,548 | 8,549 | ||||||||
| Backlog (units) |
7,320 | 6,134 | ||||||||||
| Backlog (dollars) |
$ | 2,400,984 | $ | 1,836,338 | ||||||||
| Mortgage banking data: |
||||||||||||
| Loan closings |
$ | 624,637 | $ | 591,595 | $ | 1,719,191 | $ | 1,605,363 | ||||
| Common stock information: |
||||||||||||
| Shares outstanding at end of period |
7,083,297 | 7,089,352 | ||||||||||
| Weighted average shares outstanding |
7,151,000 | 7,310,000 | 7,118,000 | 7,349,000 | ||||||||
| Diluted shares outstanding |
8,716,000 | 9,074,000 | 8,718,000 | 9,299,000 | ||||||||
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