Beazer Homes Reports $468.9M Revenue, Declines in Profitability for Q1 2024

Beazer Homes USA, Inc. reported a total revenue of $468.9 million for the first fiscal quarter ending December 31, 2024, marking a 21.3% increase from $386.8 million in the same period last year. However, the company experienced a significant decline in profitability, with net income falling to $3.1 million, down from $21.7 million in the prior year. This resulted in a basic income per share of $0.10, compared to $0.71 in the previous year. The decrease in profitability was attributed to increased price concessions and closing cost incentives, which pressured gross margins.

The company’s homebuilding gross margin decreased to 15.2% from 19.9% year-over-year, reflecting the impact of a higher share of spec home closings, which typically yield lower margins. General and administrative expenses rose to $49.8 million, up from $42.0 million, while selling, general, and administrative expenses as a percentage of total revenue improved slightly to 14.0% from 14.3%. Beazer's operating income also saw a sharp decline, dropping to $2.1 million from $20.3 million in the prior year, primarily due to the reduced gross profit.

In terms of operational developments, Beazer Homes increased its average active community count to 161, a 17.8% rise from 137 in the previous year. The company reported net new orders of 932 homes, a 13.2% increase from 823 in the prior year, despite a slight decline in sales pace. The average selling price for homes closed during the quarter was $507,600, down 1.0% from $512,700 in the previous year. The company controlled 28,874 lots as of December 31, 2024, a 9.5% increase from the previous year, with 58.9% of these lots under option agreements.

Looking ahead, Beazer Homes remains optimistic about the long-term outlook for the housing market, despite current challenges such as elevated mortgage rates and affordability concerns. The company aims to achieve more than 200 active communities by the end of fiscal 2026 and is focused on reducing its net debt to net capitalization ratio below 30% by the same timeframe. Beazer also plans to ensure that 100% of its home starts are Zero Energy Ready by the end of calendar year 2025, aligning with its sustainability goals. The company believes it is well-positioned to navigate the evolving market dynamics with a strong balance sheet and ample liquidity.