IRVINE, CA—Orange County home builder TRI Pointe Homes reported that new home orders were up 37% and 17% adjusted for Q4, and that its net income of $41.4 million, in a year end report released this week.

On July 7, 2014, TRI Pointe consummated the previously announced merger with Weyerhaeuser Real Estate Company (“WRECO”). Before the merger, WRECO was an indirect wholly-owned subsidiary of Weyerhaeuser Company engaged in homebuilding and related activities through five operating subsidiaries. The merger was accounted for as a “reverse acquisition” of TRI Pointe by WRECO. As a result, legacy TRI Pointe's financial results are only included in the combined company's financial statements from the closing date forward and are not reflected in the combined company's historical financial statements, except for legacy TRI Pointe's common stock. Accordingly, legacy TRI Pointe's financial results are not included in the Generally Accepted Accounting Principles (“GAAP”) results for any periods prior to the closing.

“We are pleased with the progress we made in the fourth quarter and full year 2014”, commented Douglas Bauer, TRI Pointe's chief executive officer. “Over the last year, TRI Pointe has transformed itself from a regional builder with limited size and scope to a more diversified company with a portfolio of six homebuilding brands building in ten of the best markets in the country. The integration of the WRECO homebuilders is complete, and now we are extremely excited about building a market leading culture that will be recognized for market share and for being a top performer.”

The company also announced a rebranding to TRI Pointe Group.

“The rebrand to TRI Pointe Group not only signifies a new name, but also a new national company comprised of 6 premium regional homebuilders,” Bauer said. “We plan to reorganize our corporate structure with a new holding company parent to be named TRI Pointe Group. We expect to complete the reorganization in the second quarter of 2015.”

The TRI Pointe Group stock ticker will remain “TPH”. The TRI Pointe Homes brand will continue its homebuilding operations in California and Colorado as a wholly owned subsidiary of the TRI Pointe Group.

GAAP Results and Operational Data for Fourth Quarter 2014 and Comparisons to Fourth Quarter 2013

Income from continuing operations was $41.4 million, or $0.26 per diluted share compared to a loss from continuing operations of $(179.6) million, or $(1.38) per diluted share
New home orders increased to 714 compared to 521, an increase of 37%
Active selling communities averaged 105.6 compared to 90.1
- New home orders per average selling community were 6.8 orders (2.25 monthly) compared to 5.8 orders (1.93 monthly)
- Cancellation rate decreased to 17% compared to 21%
Backlog units of 1,032 homes with a dollar value increase of 29%, to $653.1 million
- Average sales price in backlog increased 12% to $633,000
Home sales revenue of $623.0 million, an increase of 31%
- New homes deliveries of 1,122, up 5%
- Average sales price of homes delivered grew 26% to $555,000
Homebuilding gross margin percentage of 19.9%
- Excluding noncash purchase accounting adjustments and interest, our adjusted homebuilding gross margin percentage was 22.7%
SG&A expense as a percentage of homes sales revenue improved to 8.9% compared to 9.8%
Ratio of net debt to capital of 40.6% at December 31, 2014 improved from 51.0% at December 31, 2013
Cash of $170.6 million and availability under unsecured revolving credit facility of $153 million

GAAP Results and Operational Data for Full Year 2014 and Comparisons to Full Year 2013

Income from continuing operations was $84.2 million, or $0.58 per diluted share compared to a loss from continuing operations of $(151.3) million, or $(1.17) per diluted share
New home orders decreased to 2,947 compared to 3,055
Home sales revenue of $1.6 billion, an increase of 35%
- New homes deliveries of 3,100, up 5%
- Average sales price of homes delivered grew 28% to $531,000
Homebuilding gross margin percentage of 19.9%
- Excluding noncash purchase accounting adjustments and interest, our adjusted homebuilding gross margin percentage was 22.8%
SG&A expense as a percentage of homes sales revenue improved to 11.3% compared to 13.9%

Instant Insights /

TRI Pointe Homes Reports Post-Merger Results

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