Taylor Morrison Home Corp Q3 2024 10-Q Filing

TL;DR

**TMHC Q3 2024 10-Q filed. Shows performance across home, land, and financial services segments vs. last year.**

AI Summary

Taylor Morrison Home Corp filed its 10-Q for the period ending September 30, 2024. The filing details financial performance across its Home Sales, Land Sales, Financial Services, and Amenity segments for the third quarter and the first nine months of the year, comparing them to the same periods in 2023.

Why It Matters

This filing provides investors with a detailed look at Taylor Morrison's financial health and operational performance in the housing market for the third quarter of 2024.

Risk Assessment

Risk Level: low — This is a standard quarterly financial filing with no immediate red flags.

Key Numbers

• Q3 2024 — Reporting Period (Third quarter financial performance is detailed.)
• First Nine Months 2024 — Reporting Period (Year-to-date financial performance is detailed.)

Key Players & Entities

• Taylor Morrison Home Corp (company) — Filer of the 10-Q
• 2024-09-30 (date) — End of the reporting period
• 2023 (date) — Comparative period for financial results

FAQ

Key Financial Figures

• $0.00001 — ange on which registered Common Stock, $0.00001 par value TMHC New York Stock Exchange

Filing Documents

• tmhc-20240930.htm (10-Q) — 1705KB
• tmhc-20240930xexx311.htm (EX-31.1) — 10KB
• tmhc-20240930xexx312.htm (EX-31.2) — 10KB
• tmhc-20240930xexx321.htm (EX-32.1) — 5KB
• tmhc-20240930xexx322.htm (EX-32.2) — 5KB
• 0001628280-24-043469.txt ( ) — 8239KB
• tmhc-20240930.xsd (EX-101.SCH) — 50KB
• tmhc-20240930_cal.xml (EX-101.CAL) — 69KB
• tmhc-20240930_def.xml (EX-101.DEF) — 241KB
• tmhc-20240930_lab.xml (EX-101.LAB) — 592KB
• tmhc-20240930_pre.xml (EX-101.PRE) — 437KB
• tmhc-20240930_htm.xml (XML) — 1360KB

Financial Statements of Taylor Morrison Home Corporation (Unaudited)

Financial Statements of Taylor Morrison Home Corporation (Unaudited) 2 Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023 3 Condensed Consolidated Statements of Operations for the three and nine months ended Sep tember 30, 2024 and 2023 4 Condensed Consolidated Statements of Stockholders' Equity for the three and nine months ended September 30, 2024 and 2023 6 Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023 7 Notes to the Unaudited Condensed Consolidated Financial Statements 23 ITEM 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 37 ITEM 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 38 ITEM 4.

Controls and Procedures

Controls and Procedures Part II OTHER INFORMATION 39 ITEM 1.

Legal Proceedings

Legal Proceedings 39 ITEM 1A.

Risk Factors

Risk Factors 40 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds 40 ITEM 3. Defaults Upon Senior Securities 40 ITEM 4. Mine Safety Disclosures 40 ITEM 5. Other Information 41 ITEM 6. Exhibits 42

SIGNATURES

SIGNATURES TAYLOR MORRISON HOME CORPORATION 10-Q 1 Table of Contents

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS TAYLOR MORRISON HOME CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, unaudited) September 30, 2024 December 31, 2023 Assets Cash and cash equivalents $ 256,447 $ 798,568 Restricted cash 846 8,531 Total cash 257,293 807,099 Real estate inventory: Owned inventory 6,265,280 5,473,828 Consolidated real estate not owned 175,245 71,618 Total real estate inventory 6,440,525 5,545,446 Land deposits 273,967 203,217 Mortgage loans held for sale 265,356 193,344 Lease right of use assets 69,083 75,203 Prepaid expenses and other assets, net 336,051 290,925 Other receivables, net 207,595 184,518 Investments in unconsolidated entities 397,061 346,192 Deferred tax assets, net 67,825 67,825 Property and equipment, net 322,483 295,121 Goodwill 663,197 663,197 Total assets $ 9,300,436 $ 8,672,087 Liabilities Accounts payable $ 269,300 $ 263,481 Accrued expenses and other liabilities 577,501 549,074 Lease liabilities 79,426 84,999 Income taxes payable 5,528 — Customer deposits 307,510 326,087 Estimated development liabilities 19,241 27,440 Senior notes, net 1,470,014 1,468,695 Loans payable and other borrowings 439,878 394,943 Revolving credit facility borrowings — — Mortgage warehouse facilities borrowings 233,331 153,464 Liabilities attributable to consolidated real estate not owned 175,245 71,618 Total liabilities $ 3,576,974 $ 3,339,801 COMMITMENTS AND CONTINGENCIES (Note 13) Stockholders' equity Total stockholders' equity 5,723,462 5,332,286 Total liabilities and stockholders' equity $ 9,300,436 $ 8,672,087 See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements TAYLOR MORRISON HOME CORPORATION 10-Q 2 Table of Contents

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS TAYLOR MORRISON HOME CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts, unaudited) Three Months Ended September 30, Nine Months Ended September 30, 2024 2023 2024 2023 Home closings revenue, net $ 2,029,134 $ 1,611,883 $ 5,585,516 $ 5,221,225 Land closings revenue 27,820 14,291 48,279 31,439 Financial services revenue 49,654 40,045 145,529 117,108 Amenity and other revenue 14,234 9,326 32,323 28,194 Total revenue 2,120,842 1,675,545 5,811,647 5,397,966 Cost of home closings 1,525,825 1,238,999 4,231,740 3,980,749 Cost of land closings 27,010 13,572 50,915 30,620 Financial services expenses 27,304 23,128 80,553 70,618 Amenity and other expenses 9,634 8,128 28,237 25,010 Total cost of revenue 1,589,773 1,283,827 4,391,445 4,106,997 Gross margin 531,069 391,718 1,420,202 1,290,969 Sales, commissions and other marketing costs 117,714 98,797 334,270 304,591 General and administrative expenses 81,627 68,994 231,970 205,904 Net income from unconsolidated entities ( 707 ) ( 1,934 ) ( 6,086 ) ( 7,049 ) Interest expense/(income), net 3,379 ( 5,782 ) 7,423 ( 12,013 ) Other (income)/expense, net ( 3,635 ) 2,968 3,837 6,683 Loss on extinguishment of debt, net — 269 — 269 Income before income taxes 332,691 228,406 848,788 792,584 Income tax provision 81,219 57,960 206,241 196,005 Net income before allocation to non-controlling interests 251,472 170,446 642,547 596,579 Net (income)/loss attributable to non-controlling interests ( 346 ) 245 ( 1,691 ) ( 235 ) Net income $ 251,126 $ 170,691 $ 640,856 $ 596,344 Earnings per common share: Basic $ 2.41 $ 1.57 $ 6.08 $ 5.48 Diluted $ 2.37 $ 1.54 $ 5.97 $ 5.40 Weighted average number of shares of common stock: Basic 104,132 108,837 105,359 108,827 Diluted 106,089 110,622 107,361 110,536 See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements TAYLOR MORRISON HOME CORPORATION 10-Q 3 Table of Co

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS TAYLOR MORRISON HOME CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (In thousands, except share data, unaudited) For the three months ended September 30, 2024 Common Stock Additional Paid-in Capital Treasury Stock Stockholders' Equity Shares Amount Amount Shares Amount Retained Earnings Accumulated Other Comprehensive Income Non- Controlling Interests Total Stockholders' Equity Balance — June 30, 2024 104,425,808 $ 1 $ 3,070,721 57,407,167 $ ( 1,463,616 ) $ 3,900,274 $ 896 $ 18,266 $ 5,526,542 Net income — — — — — 251,126 — 346 251,472 Exercise of stock options and issuance of restricted stock units, net (1) 87,624 — 1,989 — — — — — 1,989 Repurchase of common stock (2) ( 1,043,479 ) — — 1,043,479 ( 61,849 ) — — — ( 61,849 ) Stock compensation expense — — 5,461 — — — — — 5,461 Distributions to non-controlling interests of consolidated joint ventures — — — — — — — ( 153 ) ( 153 ) Balance – September 30, 2024 103,469,953 $ 1 $ 3,078,171 58,450,646 $ ( 1,525,465 ) $ 4,151,400 $ 896 $ 18,459 $ 5,723,462 (1) Dollar amount includes $ 2.0 million of stock options exercised netted with the value of shares withheld for taxes on the issuance of restricted stock units. (2) Dollar amount includes $ 50.0 million of Accelerated Share Repurchases and an incremental amount related to the 1% excise tax on share repurchases. For the three months ended September 30, 2023 Common Stock Additional Paid-in Capital Treasury Stock Stockholders' Equity Shares Amount Amount Shares Amount Retained Earnings Accumulated Other Comprehensive Income Non- Controlling Interests Total Stockholders' Equity Balance - June 30, 2023 109,443,784 $ 1 $ 3,051,377 51,506,248 $ ( 1,140,706 ) $ 3,167,268 $ 359 $ 17,014 5,095,313 Net income — — — — — 170,691 — ( 245 ) 170,446 Exercise of stock options and issuance of restricted stock units, net (1) 164,510 — 3,649 — — — — — 3,649 Repurchase of common stock ( 2,169,657 ) — — 2,169

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS For the nine months ended September 30, 2024 Common Stock Additional Paid-in Capital Treasury Stock Stockholders' Equity Shares Amount Amount Shares Amount Retained Earnings Accumulated Other Comprehensive Income Non- Controlling Interest Total Stockholders' Equity Balance – December 31, 2023 106,917,636 $ 1 $ 3,068,597 54,211,879 $ ( 1,265,097 ) $ 3,510,544 $ 896 $ 17,345 $ 5,332,286 Net income — — — — — 640,856 — 1,691 642,547 Exercise of stock options and issuance of restricted stock units, net (1) 791,084 — ( 7,442 ) — — — — — ( 7,442 ) Repurchase of common stock (2) ( 4,238,767 ) — — 4,238,767 ( 260,368 ) — — — ( 260,368 ) Stock compensation expense — — 17,016 — — — — — 17,016 Distributions to non-controlling interests of consolidated joint ventures — — — — — — — ( 577 ) ( 577 ) Balance – September 30, 2024 103,469,953 $ 1 $ 3,078,171 58,450,646 $ ( 1,525,465 ) $ 4,151,400 $ 896 $ 18,459 $ 5,723,462 (1) Dollar amount includes $ 7.5 million of stock options exercised netted with the value of shares withheld for taxes on the issuance of restricted stock units . (2) Dollar amount includes $ 150.0 million of Accelerated Share Repurchases and an incremental amount related to the 1% excise tax on share repurchases. For the nine months ended September 30, 2023 Common Stock Additional Paid-in Capital Treasury Stock Stockholders' Equity Shares Amount Amount Shares Amount Retained Earnings Accumulated Other Comprehensive Income Non- controlling Interest Total Stockholders' Equity Balance – December 31, 2022 107,995,262 $ 1 $ 3,025,489 51,396,923 $ ( 1,137,138 ) $ 2,741,615 $ 359 $ 16,533 $ 4,646,859 Net income — — — — — 596,344 — 235 596,579 Exercise of stock options and issuance of restricted stock units, net (1) 1,722,357 — 16,733 — — — — — 16,733 Repurchase of common stock ( 2,278,982 ) — — 2,278,982 ( 103,568 ) — — — ( 103,568 ) Stock compensation expense — — 18,506 — — — — — 18,506 Changes in non-controlli

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS TAYLOR MORRISON HOME CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands, unaudited) Nine Months Ended September 30, 2024 2023 Cash Flows from Operating Activities Net income before allocation to non-controlling interests $ 642,547 $ 596,579 Adjustments to reconcile net income to net cash (used in)/provided by operating activities: Net income from unconsolidated entities ( 6,086 ) ( 7,049 ) Stock compensation expense 17,016 18,506 Loss on extinguishment of debt, net — 269 Distributions of earnings from unconsolidated entities 11,265 7,377 Depreciation and amortization 31,494 23,717 Operating lease expense 16,089 19,271 Debt issuance costs amortization 2,223 2,574 Estimated development liabilities change in estimate ( 8,175 ) — Inventory impairment charges 2,325 11,791 Land held for sale write-down 6,782 — Changes in operating assets and liabilities: Real estate inventory and land deposits ( 871,310 ) ( 87,776 ) Mortgage loans held for sale, prepaid expenses and other assets ( 183,674 ) 24,081 Customer deposits ( 18,577 ) ( 31,548 ) Accounts payable, accrued expenses and other liabilities 124,383 ( 27,231 ) Income taxes payable 5,528 — Net cash (used in)/provided by operating activities $ ( 228,170 ) $ 550,561 Cash Flows from Investing Activities: Purchase of property and equipment ( 26,270 ) ( 47,042 ) Distributions of capital from unconsolidated entities 18,599 733 Investments of capital into unconsolidated entities ( 74,647 ) ( 47,795 ) Net cash used in investing activities $ ( 82,318 ) $ ( 94,104 ) Cash Flows from Financing Activities Increase in loans payable and other borrowings — 2,426 Repayments on loans payable and other borrowings ( 52,093 ) ( 18,367 ) Borrowings on revolving credit facility 100,000 — Repayments on revolving credit facility ( 100,000 ) — Borrowings on mortgage warehouse facilities 2,588,250 2,203,261 Repayments on mortgage warehouse facilities ( 2

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS TAYLOR MORRISON HOME CORPORATION NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. BUSINESS Description of the Business — Taylor Morrison Home Corporation ("TMHC"), through its subsidiaries (together with TMHC referred to herein as "we," "our," "the Company" and "us"), owns and operates a residential homebuilding business and is a land developer. We operate in the states of Arizona, California, Colorado, Florida, Georgia, Indiana, Nevada, North and South Carolina, Oregon, Texas, and Washington. We provide an assortment of homes across a wide range of price points to appeal to an array of consumer groups. We design, build and sell single and multi-family detached and attached homes in traditionally high growth markets for entry level, move-up, and resort-lifestyle buyers. We are the general contractors for all real estate projects and engage subcontractors for home construction and land development. Our homebuilding segments operate under various brand names including Taylor Morrison, Darling Homes Collection by Taylor Morrison, and Esplanade. We also have a "Build-to-Rent" homebuilding business which operates under the Yardly brand name. In addition, we develop and construct multi-use properties consisting of commercial space, retail, and multi-family properties under the Urban Form brand. We also have operations which provide financial services to customers through our wholly owned mortgage subsidiary, Taylor Morrison Home Funding, Inc. ("TMHF"), title services through our wholly owned title services subsidiary, Inspired Title Services, LLC ("Inspired Title"), and homeowner's insurance policies through our insurance agency, Taylor Morrison Insurance Services, LLC ("TMIS"). Our business is organized into multiple homebuilding operating components, and a financial services component, all of which are managed as four reportable segments: East, Central, West, and Financial Services. 2. SUMMARY OF SIGNIFICANT ACCO

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS We capitalize qualifying interest costs to inventory during the development and construction periods. Capitalized interest is charged to Cost of home closings when the related inventory is charged to Cost of home closings. We assess the recoverability of our inventory in accordance with the provisions of ASC Topic 360, Property, Plant, and Equipment ("Topic 360"). We review our real estate inventory for indicators of impairment on a community-level basis during each reporting period. If indicators of impairment are present for a community, an undiscounted cash flow analysis is generally prepared in order to determine if the carrying value of the assets in that community exceeds the estimated undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, fair value can be determined through other methods, such as appraisals, contractual purchase offers, and other third party opinions of value. Changes in these projections and estimates may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the three months ended September 30, 2024, there was no inventory impairment recorded. For the nine months ended September 30, 2024, we recorded $ 2.3 million of inventory impairment relating to one of our communities in our East reporting segment. For the three and nine months ended September 30, 2023, we recorded $ 11.8 million of impairment charges relating to one of our communities in our West reporting segment. Inventory impairments are recorded to Cost of home closings on the unaudited Condensed consolidated statements of operations. In certai

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS sales listing agreement, purchase and sales agreement, letter of intent, broker price opinion, recent offers received, prices for assets in recent comparable sales transactions, or other third-party estimate. Impairment loss on real estate or inventory assets held for sale is recognized when the carrying value is greater than the fair value less estimated costs to sell, which is based on the estimated sales price of the property. In

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