First Quarter 2024 Highlights First quarter net new home orders of 612, a 23% year-over-year increase Total revenue of $294.0 million, driven by 505 home closings at an average price of $579,000 Adjusted EBITDA of $17.0 million Book value per share of $17.92 Repurchased approximately 534,000 shares of common stock for $6.4 million DALLAS, May 01, 2024 (GLOBE NEWSWIRE) -- Landsea Homes Corporation (NASDAQ:LSEA) ("Landsea Homes" or the "Company"), a publicly traded homebuilder, reported financial results for the first quarter ended March 31, 2024. For the quarter, the Company reported pretax income of $0.7 million, and net income of $0.2 million, or $0.01 per share. Excluding one-time transaction costs of $1.7 million, net income was $1.9 million or $0.05 per share. Reported pretax income for the prior year period was $5.7 million with net income of $3.2 million, or $0.08 per share. Adjusted net income (a non-GAAP measure) was $2.0 million or $0.06 per share and adjusted gross margin of 19.4%. For the prior year period, adjusted net income was $7.1 million, or $0.18 per share and adjusted gross margin of 21.9%. Management Commentary "Landsea Homes delivered strong top-line growth in the first quarter of 2024, as home sales revenue increased 22% on a year-over-year basis", said John Ho, Landsea Homes' Chief Executive Officer. "New home deliveries came above the high end of our guidance range at 505, while average selling prices increased 14% year-over-year to $579,000. We also generated 612 net new orders during the quarter on a sales pace of 3.3 homes per community per month." Mr. Ho continued, "We have experienced solid demand trends so far this spring and look to carry this momentum into the summer and beyond. The lack of existing home inventory continues to be a tailwind for our industry, while economic growth and employment trends in our markets have bolstered demand. The recent rise in interest rates has created some challenges on the affordability front, but we have and will continue to address those issues through the use of interest rate buydowns and other financing incentives." Mr. Ho concluded, "We executed two capital markets transactions during the quarter that greatly improved the stability of our balance sheet. The first was another successful equity offering from our largest shareholder, which took their stake below 50% and removed the Controlled Company designation for Landsea Homes as per Nasdaq listing standards. The second transaction was our placement in April of $300 million in senior notes due in 2029 at an interest rate of 8 7/8ths, which allowed us to pay down a portion of the outstanding borrowings under our revolving credit facility and provides us with longer term, fixed rate capital to pursue our growth initiatives. Given the progress we made from both an operational and financial standpoint this quarter, I am confident in our ability to achieve our goals for 2024 and beyond." Operating Results Total revenue was $294.0 million in the first quarter, up 22% compared to the first quarter of 2023, primarily driven by a 7% increase in homes closed and a 14% increase in average sales price. New homes delivered increased 7% to 505 homes at an average sales price of $579,000, a 14% increase, compared to 472 homes delivered at an average sales price of $510,000 in the first quarter of 2023. Net new home orders were up 23% to 612 homes with a dollar value of $341.3 million, an average sales price of $558,000 and a monthly absorption rate of 3.3 sales per active community. This compares to 498 homes with a dollar value of $282.5 million, an average sales price of $567,000 and a monthly absorption rate of 2.8 sales per active community in the prior year period. As a percentage of gross orders, cancellations equaled 10% as compared to 16% a year ago. Total homes in backlog were 624 homes with a dollar value of $384.3 million and an average sales price of $616,000 at March 31, 2024. This compares to 696 homes with a dollar value of $422.9 million and an average sales price of $608,000 at March 31, 2023. Total lots owned or controlled at March 31, 2024, were 10,351 compared to 11,435 at March 31, 2023. We continue to pursue an asset-light strategy, controlling 59% of our lots at the end of the first quarter of 2024 and 41% were owned. Home sales gross margin was 14.9% compared to 18.1% in the prior year period. Adjusted home sales gross margin (a non-GAAP measure) was 19.4% compared to 21.9% in the prior year period. The decrease was primarily attributed to the increase in sales discounts and incentives. Net income attributable to Landsea Homes was $0.2 million compared to $3.2 million in the prior year period. Adjusted net income attributable to Landsea Homes (a non-GAAP measure) was $2.0 million compared to $7.1 million in the prior year period. Net income per share on a fully diluted basis was $0.01 compared to $0.08 in the first quarter of 2023. Adjusted net income per share (a non-GAAP measure) on a fully diluted basis was $0.06 compared to $0.18 in the first quarter of 2023. Adjusted EBITDA (a non-GAAP measure) was $17.0 million compared to $16.2 million in the prior year period. Balance Sheet As of March 31, 2024, the Company had total liquidity of $364.1 million consisting of cash and cash equivalents as well as cash held in escrow of $140.0 million and $224.1 million in availability under the Company's $675.0 million unsecured revolving credit facility. Total debt was $585.2 million compared to $543.8 million at December 31, 2023. Landsea Homes' ratio of debt to capital was 46.4% at March 31, 2024, and the Company's net debt to total capital (a non-GAAP measure) was 35.3% at March 31, 2024. Second Quarter 2024 Outlook New home deliveries anticipated to be in the range of 600 to 650 Delivery ASPs expected to be in the range of $525,000 to $530,000 Home sales gross margin to be between 15% and 16% Full Year 2024 Outlook New home deliveries anticipated to be in the range of 2,500 to 2,900 Delivery ASPs expected to be in the range of $500,000 to $525,000 Home sales gross margin to be between 17% and 18% Conference Call The Company will hold a conference call today at 9:00 a.m. Central Time (10:00 a.m. Eastern time) to discuss its first quarter 2024 results. Toll-free dial-in number: 1-877-704-4453 International dial-in number: 1-201-389-0920 The conference call will be broadcast live and available for replay here and via the Investors section of the Landsea Homes website at https://ir.landseahomes.com/. A replay of the conference call will be available after 1:00 p.m. Eastern time on the same day through the same time on May 1, 2024. Replay Details: Toll-free replay number: 1-844-512-2921 International replay number: 1-412-317-6671 Replay ID: 13745940 About Landsea Homes Corporation Landsea Homes Corporation (NASDAQ:LSEA) is a publicly traded residential homebuilder based in Dallas, Texas that designs and builds best-in-class homes and sustainable master-planned communities in some of the nation's most desirable markets. The company has developed homes and communities in New York, Boston, New Jersey, Arizona, Colorado, Florida, Texas and throughout California in Silicon Valley, Los Angeles, and Orange County. Landsea Homes was honored as the Green Home Builder 2023 Builder of the Year, after being named the 2022 winner of the prestigious Builder of the Year award, presented by BUILDER magazine, in recognition of a historical year of transformation. An award-winning homebuilder that builds suburban, single-family detached and attached homes, mid-and high-rise properties, and master-planned communities, Landsea Homes is known for creating inspired places that reflect modern living and provides homebuyers the opportunity to "Live in Your Element." Our homes allow people to live where they want to live, how they want to live – in a home created especially for them. Driven by a pioneering commitment to sustainability, Landsea Homes' High Performance Homes are responsibly designed to take advantage of the latest innovations with home automation technology supported by Apple®. Homes include features that make life easier and provide energy savings that allow for more comfortable living at a lower cost through sustainability features that contribute to healthier living for both homeowners and the planet. Led by a veteran team of industry professionals who boast years of worldwide experience and deep local expertise, Landsea Homes is committed to positively enhancing the lives of our homebuyers, employees, and stakeholders by creating an unparalleled lifestyle experience that is unmatched. For more information on Landsea Homes, visit: www.landseahomes.com. Forward-Looking Statements Certain statements in this press release may constitute "forward-looking statements" within the meaning of the federal securities laws, including, but not limited to, our expectations for future financial performance, business strategies or expectations for our business. These statements constitute projections, forecasts, and forward-looking statements, and are not guarantees of performance. Landsea Homes cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Words such as "may," "can," "should," "will," "estimate," "plan," "project," "forecast," "intend," "expect," "anticipate," "believe," "seek," "target," "look" or similar expressions may identify forward-looking statements. Specifically, forward-looking statements may include statements relating to the future financial performance of Landsea Homes; changes in the market for Landsea Homes' products and services; and other expansion plans and opportunities. These forward-looking statements are based on information available as of the date of this press release and our management's current expectations, forecasts, and assumptions, and involve a number of judgments, risks and uncertainties that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the risk factors described by Landsea Homes in its filings with the Securities and Exchange Commission ("SEC"). These risk factors and those identified elsewhere in this press release, among others, could cause actual results to differ materially from historical performance and include, but are not limited to: the cyclical nature of our industry and the possibility that adverse changes in general and local economic conditions could reduce the demand for homes; our ability to develop communities successfully and in a timely manner; changes in the terms and availability of mortgage financing, interest rates, federal lending programs, and tax laws, affecting the demand for and the ability of our homebuyers to complete the purchase of a home; our geographic concentration, which could materially and adversely affect us if the homebuilding industry in our current markets should experience a decline; the potential for adverse weather and geological conditions to increase costs, cause project delays or reduce consumer demand for housing; our ability to promptly sell one or more properties for reasonable prices in response to changing economic, financial and investment conditions, and the risk that we may be forced to hold non-income producing properties for extended periods of time; our reliance on third-party skilled labor, suppliers and long supply chains; the dependence of our long-term sustainability and growth upon our ability to acquire lots that are either developed or have the approvals necessary for us to develop them; and the other risks and uncertainties indicated in Landsea Homes' SEC reports or documents filed or to be filed with the SEC by Landsea Homes. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and you should not place undue reliance on these forward-looking statements in deciding whether to invest in our securities. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Stock Repurchase Purchases of common stock pursuant to this authority may be made in open market transactions effected through a broker-dealer at prevailing market prices, in block trades, or by other means in accordance with federal securities laws, including pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The Company is not obligated to repurchase any specific number or amount of shares of common stock, and it may modify, suspend or discontinue the program at any time. The Company will determine the timing and amount of repurchase in its discretion based on a variety of factors, such as the market price of the Company's common stock, corporate requirements, general market economic conditions and legal requirements. Investor Relations Contact:Drew Mackintosh, CFA Mackintosh Investor Relations, 924-9036 Media Contact:Annie NoebelCornerstone 449-2527   March 31, 2024   December 31, 2023   (dollars in thousands) Assets       Cash and cash equivalents $ 121,492   $ 119,555 Cash held in escrow   18,460     49,091 Real estate inventories   1,196,506     1,121,726 Due from affiliates   4,462     4,348 Goodwill   68,639     68,639 Other assets   133,818     107,873 Total assets $ 1,543,377   $ 1,471,232         Liabilities       Accounts payable $ 88,707   $ 77,969 Accrued expenses and other liabilities   192,115     160,256 Due to affiliates   881     881 Line of credit facility, net   348,237     307,631 Senior notes, net   236,913     236,143 Total liabilities   866,853     782,880         Commitments and contingencies               Equity       Stockholders' equity:       Preferred stock, $0.0001 par value, 50,000,000 shares authorized, none issued and outstanding as of March 31, 2024 and December 31, 2023, respectively   —     — Common stock, $0.0001 par value, 500,000,000 shares authorized, 41,525,731 issued and 36,129,736 outstanding as of March 31, 2024, 41,382,453 issued and 36,520,894 outstanding as of December 31, 2023   4     4 Additional paid-in capital   459,521     465,290 Retained earnings   187,774     187,584 Total stockholders' equity   647,299     652,878 Noncontrolling interests   29,225     35,474 Total equity   676,524     688,352 Total liabilities and equity $ 1,543,377   $ 1,471,232     Three Months Ended March 31,     2024       2023   (dollars in thousands, except per share amounts) Revenue       Home sales $ 292,592     $ 240,625 Lot sales and other   1,449       1,115 Total revenues   294,041       241,740         Cost of sales       Home sales   248,897       197,054 Lot sales and other   1,683       713 Total cost of sales   250,580       197,767         Gross margin       Home sales   43,695       43,571 Lot sales and other   (234 )     402 Total gross margin   43,461       43,973         Sales and marketing expenses   18,488       16,408 General and administrative expenses   26,082       22,780 Total operating expenses   44,570       39,188         (Loss) income from operations   (1,109 )     4,785         Other income, net   1,813       955 Pretax income   704       5,740         (Benefit) provision for income taxes   (30 )     1,617         Net income   734       4,123 Net income attributable to noncontrolling interests   544       905 Net income attributable to Landsea Homes Corporation $ 190     $ 3,218         Income per share:       Basic $ 0.01     $