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

NVR, Inc.

(Exact name of registrant as specified in its charter)

Virginia		1-12378		54-1394360
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer 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:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o 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 26, 2006, NVR, Inc. issued a press release reporting its financial results for the quarter and the year ended December 31, 2005. A copy of this press release is furnished hereto as Exhibit 99.1.

Item 9.01		Financial Statements and Exhibits

     (c) Exhibits

Number		Description
99.1		Press release dated January 26, 2006.

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, 2006				By:		/s/ Dennis M. Seremet
				Name:		Dennis M. Seremet
				Title:		Vice President and
						Chief Financial Officer

INDEX TO EXHIBITS

Exhibit Number		Exhibit Description
99.1		Press release dated January 26, 2006.

EXHIBIT 99.1

NVR, INC. ANNOUNCES A 50% INCREASE IN EARNINGS PER SHARE AND 13%
NEW ORDER GROWTH FOR THE FOURTH QUARTER OF 2005

FOR IMMEDIATE RELEASE				Contact:		Dan Malzahn
				Office:		(703) 956-4204

January 26, 2006, Reston, VA—NVR, Inc. (AMEX: NVR), one of the nation’s largest homebuilding and mortgage banking companies, announced that diluted earnings per share for its fourth quarter ended December 31, 2005 increased 50% and net income increased 40% when compared to the 2004 fourth quarter. Net income for the 2005 fourth quarter was $222,537,000, $30.29 per diluted share, compared to net income of $158,938,000, $20.13 per diluted share, for the same period of 2004. Consolidated revenues for the last three months of 2005 totaled $1,658,204,000, a 30% increase from $1,275,034,000 for the comparable 2004 quarter.

Net income for the 2005 fiscal year was $697,559,000, $89.61 per diluted share, compared to net income of $523,204,000, $66.42 per diluted share for 2004, a 33% increase in net income and a 35% increase in earnings per share. Consolidated revenues for 2005 totaled $5,262,347,000, a 22% increase from the $4,319,722,000 for 2004.

Homebuilding

New orders for the fourth quarter of 2005 increased 13% to 3,615 units, when compared to 3,194 units for the fourth quarter of 2004. The cancellation rate in the fourth quarter of 2005 was 13.3% compared to 11.4% in the fourth quarter of 2004. Settlements increased in the fourth quarter of 2005 to 4,180 units, 16% more than the same period of 2004. Homebuilding revenues for the three months ended December 31, 2005 totaled $1,630,778,000, 30% higher than the year earlier period. Income before tax from the homebuilding segment totaled $344,937,000, an increase of 38% when compared to the fourth quarter of the previous year. Gross profit margins improved to 27.6% in the 2005 fourth quarter compared to 26.0% for the same period in 2004, but declined from 28.1% in the 2005 third quarter. The year-over-year margin improvement primarily resulted from the ability in early 2005 to raise prices in certain markets that more than offset rising land and material costs.

New orders for 2005 totaled 14,653 units, an 11% increase over the 13,231 units reported for 2004. Home settlements for 2005 increased 8% to 13,787 units when compared to 12,749 units closed in 2004. Homebuilding revenues for 2005 totaled $5,177,743,000, 22% higher than 2004. Pre-tax homebuilding income rose to $1,086,680,000 for the 2005 fiscal year, an increase of 32% over the prior year. Gross profit margins increased to 27.8% in 2005 from 25.7% in 2004. The number of homes in backlog at the end of 2005 was 8,310 units, 13% higher than the 7,372 units in backlog at the end of 2004. The dollar volume in backlog increased 26% to $3,673,221,000 at December 31, 2005, when compared to the same time last year.

Mortgage Banking

Mortgage closed loan production of $1,047,941,000 for the three months ended December 31, 2005 was 27% higher than the same period last year. Operating income contributed by the mortgage banking operations during the fourth quarter of 2005 increased 37% to $19,479,000, when compared to $14,176,000 reported for the same period of 2004.

Operating income from the mortgage banking segment increased for the 2005 fiscal year to $57,739,000, a 14% increase from the $50,862,000 reported for 2004. Mortgage production for the year increased 25% to $3,388,118,000.

Outlook

The Company expects net income for the first quarter of 2006 to increase approximately 5% over the first quarter of 2005. The Company expects full year 2006 gross margins to be negatively impacted by pricing pressure in many of its markets; however, the Company expects full year 2006 net income to exceed 2005 results by approximately 15%. Full year net income expectations include an after tax expense of approximately $36,000,000 for the implementation of FAS 123R, Share Based Payment.

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. 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 variations thereof or comparable terminology, or by discussion of strategies, each of which involves risks and uncertainties. All statements other than those of historical facts included herein, including those regarding market trends, NVR’s financial position, business strategy, projected plans and objectives of management for future operations, 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 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, general economic and business 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 NVR in its homebuilding operations, shortages of labor, weather related slow downs, building moratoria, governmental regulation, the ability of NVR to integrate any acquired business, fluctuation and volatility of stock and other financial markets and other factors over which NVR has little or no control. The Company has no obligation to update such forward-looking statements.

NVR, Inc.
Consolidated Statements of Income
(amounts in thousands, except per share data)

		Three Months Ended December 31,								Twelve Months Ended December 31,
		2005				2004				2005				2004
Homebuilding:
Revenues		$	1,630,778			$	1,255,714			$	5,177,743			$	4,247,503
Other income			2,144				653				6,301				2,655
Cost of sales			(1,180,762	)			(929,102	)			(3,738,030	)			(3,156,286	)
Selling, general and administrative			(102,249	)			(73,490	)			(345,525	)			(260,795	)
Operating income			349,911				253,775				1,100,489				833,077
Interest expense			(4,974	)			(3,056	)			(13,809	)			(11,934	)
Homebuilding income			344,937				250,719				1,086,680				821,143
Mortgage Banking:
Mortgage banking fees			27,426				19,320				84,604				72,219
Interest income			1,738				1,312				5,014				4,249
Other income			413				309				1,435				1,075
General and administrative			(9,069	)			(6,556	)			(31,555	)			(25,593	)
Interest expense			(1,029	)			(209	)			(1,759	)			(1,088	)
Mortgage banking income			19,479				14,176				57,739				50,862
Income before taxes			364,416				264,895				1,144,419				872,005
Income tax expense			(141,879	)			(105,957	)			(446,860	)			(348,801	)
Net income		$	222,537			$	158,938			$	697,559			$	523,204
Basic earnings per share		$	37.34			$	24.65			$	110.36			$	80.83
Diluted earnings per share		$	30.29			$	20.13			$	89.61			$	66.42
Basic average shares outstanding			5,959				6,449				6,321				6,473
Diluted average shares outstanding			7,348				7,894				7,784				7,877

NVR, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)

		December 31,
		2005				2004
ASSETS
Homebuilding:
Cash and cash equivalents		$	170,090			$	362,458
Receivables			40,562				14,020
Inventory:
Lots and housing units, covered under sales agreements with customers			723,657				538,770
Unsold lots and housing units			60,419				40,052
Manufacturing materials and other			9,899				9,718
			793,975				588,540
Contract land deposits			549,160				384,959
Assets not owned, consolidated per FIN 46			275,306				89,924
Property, plant and equipment, net			31,096				25,330
Reorganization value in excess of amounts allocable to identifiable assets, net			41,580				41,580
Goodwill and other indefinite and definite life intangibles, net			12,061				6,379
Other assets			142,851				109,778
			2,056,681				1,622,968
Mortgage Banking:
Cash and cash equivalents			7,436				4,907
Mortgage loans held for sale, net			193,932				138,595
Property and equipment, net			1,003				996
Reorganization value in excess of amounts allocable to identifiable assets, net			7,347				7,347
Other assets			3,189				3,154
			212,907				154,999
Total assets		$	2,269,588			$	1,777,967

(Continued)

NVR, Inc.

Consolidated Balance Sheets (Continued)
(in thousands, except share and per share data)

		December 31,
		2005				2004
LIABILITIES AND SHAREHOLDERS’ EQUITY
Homebuilding:
Accounts payable		$	262,086			$	215,002
Accrued expenses and other liabilities			369,176				234,815
Liabilities related to assets not owned, consolidated per FIN 46			215,284				63,568
Customer deposits			256,837				203,835
Other term debt			3,325				4,077
Notes payable			103,000				—
Senior notes			200,000				200,000
			1,409,708				921,297
Mortgage Banking:
Accounts payable and other liabilities			25,902				11,949
Notes payable			156,816				9,726
			182,718				21,675
Total liabilities			1,592,426				942,972
Commitments and contingencies
Shareholders’ equity:
Common stock, $0.01 par value; 60,000,000 shares authorized; 20,592,640 and 20,597,709 shares issued for 2005 and 2004, respectively			206				206
Additional paid-in-capital			473,886				406,705
Deferred compensation trust- 547,697 and 549,029 shares of NVR, Inc. common stock for 2005 and 2004, respectively			(76,303	)			(76,366	)
Deferred compensation liability			76,303				76,366
Retained earnings			2,608,628				1,911,069
Less treasury stock at cost — 14,964,482 and 14,023,631 shares for 2005 and 2004, respectively			(2,405,558	)			(1,482,985	)
Total shareholders’ equity			677,162				834,995
Total liabilities and shareholders’ equity		$	2,269,588			$	1,777,967

NVR, Inc.
Operating Activity
(unaudited)
(dollars in thousands)

		Three Months Ended December 31,								Twelve Months Ended December 31,
		2005				2004				2005				2004
Homebuilding data:
New orders (units)
Washington (1)			978				905				3,859				3,812
Baltimore (2)			347				352				1,808				1,446
North (3)			1,582				1,295				6,062				5,335
South (4)			708				642				2,924				2,638
Total			3,615				3,194				14,653				13,231
Average new order price		$	407.1			$	381.7			$	404.6			$	364.1
Settlements (units)
Washington (1)			1,093				1,126				3,663				3,523
Baltimore (2)			505				408				1,551				1,587
North (3)			1,855				1,356				5,744				5,211
South (4)			727				707				2,829				2,428
Total			4,180				3,597				13,787				12,749
Average settlement price		$	389.6			$	348.3			$	374.9			$	332.2
Backlog (units)
Washington (1)											2,749				2,553
Baltimore (2)											1,073				816
North (3)											3,067				2,749
South (4)											1,421				1,254
Total											8,310				7,372
Average backlog price										$	442.0			$	394.2
Community count (average)			584				471				522				450
Lots controlled at end of year											106,000				83,500
Mortgage banking data:
Loan closings		$	1,047,941			$	824,859			$	3,388,118			$	2,716,630
Capture rate			87	%			86	%			87	%			84	%
Common stock information:
Shares outstanding at end of year											5,628,158				6,574,078
Weighted average basic shares outstanding			5,959,000				6,449,000				6,321,000				6,473,000
Weighted average diluted shares outstanding			7,348,000				7,894,000				7,784,000				7,877,000
Number of shares repurchased			625,900				59,505				1,269,050				674,694
Aggregate cost of shares repurchased		$452,077				$	31,887			$	962,609			$	307,603