Century Communities, Inc. Earnings Highlights for Q3 2024

Century Communities, Inc. (NYSE: CCS) demonstrated strong performance during its third-quarter earnings call on October 30, 2024, with notable year-over-year growth in home deliveries and community count.

Key Financial Metrics

• Community Count: Increased 21% year-over-year.
• Home Deliveries: Rose by 25% compared to last year.
• Home Sales Revenue: Reached $1.1 billion, a 29% increase.
• Net Income: $83 million or $2.59 per diluted share.
• Adjusted Net Income: $87 million, or $2.72 per diluted share.
• Adjusted Homebuilding Gross Margin: Slightly down to 23.6%.
• New Guidance for 2024: Home deliveries projected between 10,900 to 11,300 homes, and revenues expected to range from $4.3 billion to $4.4 billion.

Company Outlook

• Projecting 10% or more annual delivery growth starting in 2025.
• Focus on organic growth and capturing market share from private builders.
• Stable absorption rates anticipated into Q4.

Bearish Highlights

• Adjusted homebuilding gross margin slightly decreased.
• Revenues from financial services dropped due to a competitive mortgage market.
• Increase in net homebuilding debt to net capital ratio (32.1%) largely due to acquisitions.

Bullish Highlights

• 19% increase in net new contracts year-over-year.
• Competitive average sales price of $394,000.
• Acquisition of Anglia Homes expected to enhance market presence in Houston.

Missed Metrics

• Overall gross margin decreased to 21.7%.
• Expected purchase price accounting to negatively impact gross margin in Q4.

Q&A Summary

Management addressed competition in Texas and Florida, emphasizing the advantages of scale. Full integration of Anglia Homes anticipated to affect Q4 gross margins.

Conclusion

Century Communities showed robust growth in Q3, with increased home deliveries and community count. Despite slight challenges in gross margin and debt ratios, management remains optimistic about future growth prospects driven by strategic acquisitions and a focus on affordability in the housing market.

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