Smith Douglas Homes Reports First Quarter 2025 Results
ATLANTA--(BUSINESS WIRE)--May 14, 2025--
Smith Douglas Homes Corp. (NYSE: SDHC) ("Smith Douglas" or the "Company") today announced first quarter results for the three months ended March 31, 2025.
Q1 2025 Results as compared to Q1 2024:
-- Home closings increased 19% to 671 -- Home closing revenue increased 19% to $224.7 million -- Home closing gross margin of 23.8% compared to 26.1% -- Net new home orders of 768 compared to 765 -- Pretax income of $19.6 million compared to $21.4 million -- Earnings of $0.30 per diluted share compared to $0.33 -- Debt-to-book capitalization of 9.5% compared to 0.8% at December 31, 2024 -- Active community count increased 24% to 87 at quarter end -- Total controlled lots increased 45% to 20,442
Greg Bennett, Vice Chairman and Chief Executive Officer, commented, "Smith Douglas Homes turned in another quarter of strong profitability to start 2025, generating pretax income of $19.6 million, or earnings of $0.30 per diluted share. Home closing revenue grew 19% year-over-year on a similar increase in new home closings, while home closing gross margin came in at 23.8%, which was above our expectations for the quarter. I want to thank our entire team for once again executing with efficiency and precision."
Russ Devendorf, Executive Vice President and Chief Financial Officer added, "Order activity improved as the quarter progressed, though I would characterize overall demand as somewhat inconsistent and still dependent on incentives. While affordability remains an issue in our markets, we continue to see good traffic to our website and our communities. We feel this is a reflection on the appeal of our homes and the value proposition we provide to buyers."
Mr. Devendorf continued, "Despite much of the noise surrounding macroeconomic uncertainty, we remain confident in our ability to execute on our strategic plans and achieve our long-term growth goals. Active community count at quarter-end increased 24% compared to last year, while total controlled lots were up 45%, giving us a great opportunity to grow our market share and increase our size and scale. We believe our asset light strategy, solid operational execution and strong balance sheet has us well-positioned to successfully navigate today's changing homebuilding landscape."
Conference Call & Webcast Information
Management will host a conference call to discuss the Company's results at 8:30 a.m. Eastern Time on May 14, 2025. Interested parties can dial in using the numbers below or access the call via a webcast link provided in the investor relations section of the company's website.
Dial-in Numbers:
Toll Free - North America (+1) 800-715-9871
International: (+1) 646-307-1963
Conference ID: 8459388
Replay Numbers:
Toll Free - North America: (+1) 800-770-2030
Playback Passcode: 8459388
Replay will expire 7 days following the event
About Smith Douglas Homes
Headquartered in Woodstock, Georgia, Smith Douglas Homes completed its initial public offering in January 2024. Since its inception, Smith Douglas has been entrusted by over 17,500 families to fulfill their new home dreams. Ranked a top 50 builder nationally for several years and with 2,867 closings in 2024, Smith Douglas currently holds the #32 position on the Builder Magazine Top 100 list. The Smith Douglas communities are primarily targeted to entry-level and empty-nest homebuyers looking to purchase a new home priced below the Federal Housing Administration loan limit in the metro areas of Atlanta, Birmingham, Central Georgia, Charlotte, Chattanooga, Greenville, Houston, Huntsville, Nashville, and Raleigh. Smith Douglas offers its homebuyers a personalized, affordable-luxury buying experience at attractive prices.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including without limitation statements regarding the Company's performance, growth, strategic plans and opportunities, financial position, ability to navigate the changing homebuilding landscape in the macroeconomic environment, and the timing of any of the foregoing. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the factors discussed under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024, as the same may be updated from time to time in our subsequent filings with the Securities and Exchange Commission. These forward-looking statements are based on management's current estimates and expectations. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change.
Smith Douglas Homes
Condensed Consolidated Statements of Income
(Unaudited, in thousands, except share and per share amounts)
Three months ended March 31,
--------------------------------------
2025 2024
----------- ----------
Home closing revenue $ 224,722 $ 189,209
Cost of home closings 171,192 139,749
----------- ----------
Home closing gross profit 53,530 49,460
Selling, general, and administrative
costs 32,999 27,541
Equity in income from unconsolidated
entities (219) (184)
Interest expense 666 698
Other expense (income), net 517 (2)
----------- ----------
Income before income taxes 19,567 21,407
Provision for income taxes 857 921
----------- ----------
Net income 18,710 20,486
Net income attributable to
non-controlling interests and LLC
members prior to IPO 16,027 17,514
----------- ----------
Net income attributable to Smith
Douglas Homes Corp. $ 2,683 $ 2,972
=========== ==========
Period from
Three months January 11,
ended 2024 to
March 31, March 31,
2025 2024
-------------- ---------------
Earnings per share:
Basic $ 0.30 $ 0.34
Diluted $ 0.30 $ 0.33
Weighted average shares of common stock
outstanding:
Basic 8,966,734 8,846,154
Diluted 9,133,263 51,410,397
Smith Douglas Homes
Condensed Consolidated Balance Sheets
(In thousands, except share and per share amounts)
March 31, December 31,
2025 2024
------------- --------------
(unaudited)
Assets
Cash and cash equivalents $ 12,651 $ 22,363
Real estate inventory 294,991 277,834
Deposits on real estate under option or
contract 119,339 103,026
Real estate not owned 7,502 5,830
Property and equipment, net 4,317 3,775
Goodwill 25,726 25,726
Deferred tax asset, net 10,767 10,906
Other assets 38,626 26,441
--------- ----------
Total assets $ 513,919 $ 475,901
========= ==========
Liabilities and Equity
Liabilities:
Accounts payable $ 19,912 $ 17,234
Customer deposits 5,585 5,301
Notes payable 42,648 3,060
Liabilities related to real estate not
owned 7,502 5,830
Accrued expenses and other liabilities 20,708 32,348
Tax receivable agreement liability 10,401 10,401
--------- ----------
Total liabilities 106,756 74,174
Commitments and contingencies (Note 9)
Stockholders' equity:
Preferred stock, $0.0001 par value --
10,000,000 shares authorized; none issued
and outstanding as of March 31, 2025 and
December 31, 2024 -- --
Class A common stock, $0.0001 par value --
250,000,000 shares authorized; 8,991,378
and 8,846,154 shares issued and
outstanding as of March 31, 2025 and
December 31, 2024, respectively 1 1
Class B common stock, $0.0001 par value --
100,000,000 shares authorized; 42,435,897
shares issued and outstanding as of March
31, 2025 and December 31, 2024 4 4
Additional paid-in capital 58,820 58,208
Retained earnings 18,040 15,419
--------- ----------
Total stockholders' equity attributable
to Smith Douglas Homes Corp. 76,865 73,632
Non-controlling interests attributable to
Smith Douglas Holdings LLC 330,298 328,095
--------- ----------
Total equity 407,163 401,727
--------- ----------
Total liabilities and equity $ 513,919 $ 475,901
========= ==========
Smith Douglas Homes
Summary Cash Flow Information
(Unaudited, dollars in thousands)
Three months ended March 31, 2025 2024
----------------------------------------------- ------- ------
Net cash used in operating activities $(34,905) $(9,273)
Net cash used in investing activities (2,106) (430)
Net cash provided by financing activities 27,299 22,704
------- ------
Net (decrease) increase in cash and cash
equivalents (9,712) 13,001
Cash and cash equivalents, beginning of period 22,363 19,777
------- ------
Cash and cash equivalents, end of period $ 12,651 $32,778
----------------------------------------------- ------- ------
Smith Douglas Homes
Selected Other Operating Data
(Unaudited, dollars in thousands)
Three months ended March 31,
------------------------------------ --------------------------------------
2025 2024
------------------------------------ ---------- --- ---------
Home closings 671 566
ASP of homes closed $ 335 $ 334
Net new home orders 768 765
Contract value of net new home
orders $ 258,718 $ 259,440
ASP of net new home orders $ 337 $ 339
Cancellation rate(1) 8.1% 10.6%
Backlog homes (period end)(2) 791 1,110
Contract value of backlog homes
(period end) $ 270,082 $ 381,155
ASP of backlog homes (period end) $ 341 $ 343
Active communities (period end)(3) 87 70
Controlled lots (period end):
Homes under construction 995 896
Owned lots 888 693
Optioned lots 18,559 12,528
---------- --- ---------
Total controlled lots 20,442 14,117
------------------------------------ ---------- --- ---------
(1) The cancellation rate is the total number of cancellations during the
period divided by the total gross new home orders during the period.
(2) Backlog homes (period end) is the number of homes in backlog from the
previous period plus the number of net new home orders generated during
the current period minus the number of homes closed during the current
period.
(3) A community becomes active once the model is completed or the community
has its first sale. A community becomes inactive when it has fewer than
two homes remaining to sell.
Smith Douglas Homes
Selected Financial Information by Segment
(Unaudited, dollars in thousands)
Home Closing Revenue
---------------------------------------------------------------------------------------------------------
Three
months
ended
March 31, 2025 2024 Period over period change
---------- ---------------------------- ---------------------------- --------------------------------
Home ASP of Home ASP of Home ASP of
closing Home homes closing Home homes closing Home homes
revenue closings closed revenue closings closed revenue closings closed
---------- -------- -------- -------- -------- -------- -------- ---------- ---------- --------
Southeast $138,218 392 $ 353 $103,494 297 $ 348 34% 32% 1%
Central 86,504 279 310 85,715 269 319 1% 4% (3)%
------- -------- ---- ------- -------- ---- ----- --- ---- ---
Total $224,722 671 $ 335 $189,209 566 $ 334 19% 19% --%
----------- ------- -------- ---- ------- -------- ---- ----- --- ---- ---
Backlog
---------------------------------------------------------------------------------------------------------
As of
March 31, 2025 2024 Period over period change
---------- ---------------------------- ---------------------------- --------------------------------
Contract Contract Contract
value of ASP of value of ASP of value of ASP of
Backlog backlog backlog Backlog backlog backlog Backlog backlog backlog
homes homes homes homes homes homes homes homes homes
---------- ------- -------- --------- ------- -------- --------- --------- ---------- ---------
Southeast 486 $169,967 $ 350 673 $239,587 $ 356 (28)% (29)% (2)%
Central 305 100,115 328 437 141,568 324 (30)% (29)% 1%
------- ------- ----- ------- ------- ----- --- ---- --- ---
Total 791 $270,082 $ 341 1,110 $381,155 $ 343 (29)% (29)% (1)%
----------- ------- ------- ----- ------- ------- ----- --- ---- ---
Controlled Lots
-----------------------------------------------------------------------------------------------------------------
As of
March 31, 2025 2024 Period over period change
---------- ------------------------------ ------------------------------ ------------------------------------
Total Total Total
Owned(1) Optioned Controlled Owned(1) Optioned Controlled Owned(1) Optioned Controlled
---------- -------- -------- ---------- -------- -------- ---------- ---------- ---------- ------------
Southeast 948 12,980 13,928 726 8,593 9,319 31% 51% 49%
Central 935 5,579 6,514 863 3,935 4,798 8% 42% 36%
-------- -------- ---------- -------- -------- ---------- ----- --- ---- --- ------
Total 1,883 18,559 20,442 1,589 12,528 14,117 19% 48% 45%
----------- -------- -------- ---------- -------- -------- ---------- ----- --- ---- --- ------
(1) Includes homes under construction and owned lots.
Net Income
-------------------------------------------------------------
Three months ended March 31,
-------------- --------------------------------------------
Period over
2025 2024 period change
-------------- -------- ------- ------------------
Southeast $ 23,855 $ 21,005 $ 2,850
Central 7,010 10,283 (3,273)
-------- ------- -----------
Segment total 30,865 31,288 (423)
Other(1) (12,155) (10,802) (1,353)
-------- ------- -----------
Total $ 18,710 $ 20,486 $ (1,776)
--------------- -------- ------- -----------
(1) Other primarily includes homebuilding operations in non-reportable
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