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M/I Homes Reports 2025 First Quarter Results

1. Homes delivered decreased 8% to 1,976 in Q1 2025. 2. Revenue declined 7% to $976 million compared to Q1 2024. 3. Net income fell 19% to $111 million, $3.98 per share. 4. Shareholders’ equity grew to a record $3 billion, 14% increase. 5. Cancellation rate increased to 10% from 8% year-over-year.

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FAQ

Why Bearish?

Higher cancellation rates and declining deliveries reflect weakening demand, impacting future earnings. Historically, such trends correlate with stock price declines in housing sector downturns.

How important is it?

The shifts in revenue, income, and cancellation rates are critical metrics investors watch, affecting MHO stock sentiment and decisions. The record equity may provide some buffer but cannot negate the negative trends.

Why Short Term?

The immediate results demonstrate downward trends, likely affecting stock price short-term. They could influence investor sentiment quickly, given quarterly reporting frequency and market volatility.

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, /PRNewswire/ -- M/I Homes, Inc. (NYSE:MHO) announced results for the three months ended March 31, 2025. 2025 First Quarter Highlights: Homes delivered decreased 8% to 1,976 from 2,158 Revenue decreased 7% to $976 million Pre-tax income decreased 19% to $146 million, 15% of revenue Net income of $111 million ($3.98 per diluted share) versus $138 million ($4.78 per diluted share) Shareholders' equity reached an all-time record $3 billion, a 14% increase from a year ago, with book value per share of $112 New contracts were 2,292, compared to 2,547 in last year's first quarter Repurchased $50 million of common stock Return on equity of 19% The Company reported pre-tax income of $146.1 million and net income of $111.2 million ($3.98 per diluted share). This compares to pre-tax income of $180.2 million and net income of $138.1 million, or $4.78 per diluted share, for the first quarter of 2024. Homes delivered in 2025's first quarter decreased 8% to 1,976 homes. This compares to 2,158 homes delivered in 2024's first quarter. New contracts were 2,292 for the first quarter of 2025 compared to 2,547 in last year's first quarter. Homes in backlog at March 31, 2025 had a total sales value of $1.56 billion, a 13% decrease from a year ago. Backlog units at March 31, 2025 decreased 16% to 2,847 homes, with an average sales price of $548,000. At March 31, 2024, backlog sales value was $1.79 billion, with backlog units of 3,391 and an average sales price of $528,000. M/I Homes had 226 communities at March 31, 2025 compared to 219 communities at March 31, 2024. The Company's cancellation rate was 10% in the first quarter of 2025 compared to 8% in the first quarter of 2024. Robert H. Schottenstein, Chief Executive Officer and President, commented, "Our first quarter results were solid despite the many challenges facing the housing industry, including declining consumer confidence. While our new contracts were down 10% compared to a year ago, we were effective in balancing pace and price as our gross margin was a strong 25.9%. And we were very pleased with our 15% pre-tax profit margin and 19% return on equity. Mr. Schottenstein added, "Though current conditions are choppy, and are likely to continue for the foreseeable future, we remain optimistic about our business and the longer-term outlook for the housing industry. Our balance sheet is the strongest in Company history. We ended the quarter with record net worth of $3 billion, a 14% increase from a year ago, book value of $112 per share, zero borrowings under our $650 million unsecured borrowing line, cash of  $776 million,  homebuilding debt-to-capital of 19% and a net debt-to-capital ratio of negative 3%. At the end of the quarter, we had 226 active communities, a record for our company, and are positioned to grow community count this year by an average of 5%.  Despite all the market uncertainties, we are well positioned to have a solid year in 2025." The Company will broadcast live its earnings conference call today at 10:30 A.M. Eastern Time. To listen to the call live, log on to the M/I Homes' website at mihomes.com, click on the "Investors" section of the site, and select "Listen to the Conference Call." A replay of the call will continue to be available on our website through April 2026. M/I Homes, Inc. is one of the nation's leading homebuilders of single-family homes. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Chicago, Illinois; Minneapolis/St. Paul, Minnesota; Detroit, Michigan; Tampa, Sarasota, Fort Myers/Naples and Orlando, Florida; Austin, Dallas/Fort Worth, Houston and San Antonio, Texas; Charlotte and Raleigh, North Carolina and Nashville, Tennessee. Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "targets," "envisions," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements. These statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in any future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various factors, including, without limitation, factors relating to the economic environment, interest rates, availability of resources, competition, market concentration, land development activities, construction defects, product liability and warranty claims and various governmental rules and regulations including changes in trade policy affecting business including new or increased tariffs, as well as the potential impact of retaliatory tariffs and other penalties, as more fully discussed in the "Risk Factors" section of the Company's 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.  All forward-looking statements made in this press release are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed herein will increase with the passage of time. We undertake no duty to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or presentations should be consulted. M/I Homes, Inc. and Subsidiaries Summary Statement of Income (unaudited) (Dollars and shares in thousands, except per share amounts) Three Months Ended March 31, 2025 2024 New contracts 2,292 2,547 Average community count 223 216 Cancellation rate 10 % 8 % Backlog units 2,847 3,391 Backlog sales value $  1,559,251 $  1,789,340 Homes delivered 1,976 2,158 Average home closing price $            476 $            471 Homebuilding revenue:    Housing revenue $     940,031 $  1,016,513    Land revenue 4,542 3,228 Total homebuilding revenue $     944,573 $  1,019,741 Financial services revenue 31,520 26,962 Total revenue $     976,093 $  1,046,703 Cost of sales - operations 723,310 763,360 Gross margin $     252,783 $     283,343 General and administrative expense 59,073 56,084 Selling expense 52,786 53,940 Operating income $     140,924 $     173,319 Interest income, net of interest expense (5,197) (6,920) Income before income taxes $     146,121 $     180,239 Provision for income taxes 34,884 42,178 Net income $     111,237 $     138,061 Earnings per share: Basic $          4.07 $           4.92 Diluted $          3.98 $           4.78 Weighted average shares outstanding: Basic 27,314 28,052 Diluted 27,941 28,888 M/I Homes, Inc. and Subsidiaries Summary Balance Sheet and Other Information (unaudited) (Dollars in thousands, except per share amounts) As of March 31, 2025 2024 Assets: Total cash, cash equivalents and restricted cash (1) $      776,378 $      870,162 Mortgage loans held for sale 238,583 235,047 Inventory: Lots, land and land development 1,666,045 1,448,459 Land held for sale 3,903 136 Homes under construction 1,342,424 1,169,791 Other inventory 192,333 155,779 Total Inventory $   3,204,705 $   2,774,165 Property and equipment - net 33,569 33,145 Investments in joint venture arrangements 70,727 59,146 Operating lease right-of-use assets 57,428 57,890 Goodwill 16,400 16,400 Deferred income tax asset 13,451 15,313 Other assets 173,982 150,683 Total Assets $   4,585,223 $   4,211,951 Liabilities: Debt - Homebuilding Operations: Senior notes due 2028 - net $      397,846 $      397,072 Senior notes due 2030 - net 297,495 296,991 Total Debt - Homebuilding Operations $      695,341 $      694,063 Notes payable bank - financial services operations 227,957 224,321 Total Debt $      923,298 $      918,384 Accounts payable 228,909 224,972 Operating lease liabilities 58,960 59,163 Other liabilities 367,722 370,647 Total Liabilities $   1,578,889 $   1,573,166 Shareholders' Equity 3,006,334 2,638,785 Total Liabilities and Shareholders' Equity $   4,585,223 $   4,211,951 Book value per common share $        112.29 $          95.09 Homebuilding debt to capital ratio (2) 19 % 21 % (1) Includes $0.2 million and $0.5 million of restricted cash and cash held in escrow for the quarters ended March 31, 2025 and 2024, respectively. (2) The ratio of homebuilding debt to capital is calculated as the carrying value of our homebuilding debt outstanding divided by the sum of the carrying value of our homebuilding debt outstanding plus shareholders' equity. M/I Homes, Inc. and Subsidiaries Selected Supplemental Financial and Operating Data (unaudited) (Dollars in thousands) Three Months Ended March 31, 2025 2024 Cash provided by operating activities $         64,887 $        115,772 Cash used in investing activities $         (2,928) $        (17,108) Cash (used in) provided by financing activities $     (107,151) $         38,694 Land/lot purchases $       145,983 $       107,660 Land development spending $       101,599 $       119,367 Land sale revenue $           4,542 $           3,228 Land sale gross profit $              786 $           1,313 Financial services pre-tax income $         16,106 $         12,312 M/I Homes, Inc. and Subsidiaries Non-GAAP Financial Results (1) (Dollars in thousands) Three Months Ended March 31, 2025 2024 Net income $       111,237 $       138,061 Add: Provision for income taxes 34,884 42,178 Interest income - net (8,041) (9,767) Interest amortized to cost of sales 6,901 8,302 Depreciation and amortization 4,777 4,467 Non-cash charges 4,200 3,539 Adjusted EBITDA $       153,958 $       186,780 (1) We believe these non-GAAP financial measures are relevant and useful to investors in understanding our operations and may be helpful in comparing us with other companies in the homebuilding industry to the extent they provide similar information. These non-GAAP financial measures should be used to supplement our GAAP results in order to provide a greater understanding of the factors and trends affecting our operations. M/I Homes, Inc. and Subsidiaries Selected Supplemental Financial and Operating Data NEW CONTRACTS Three Months Ended March 31, % Region 2025 2024 Change Northern 1,065 1,162 (8) % Southern 1,227 1,385 (11) % Total 2,292 2,547 (10) % HOMES DELIVERED Three Months Ended March 31, % Region 2025 2024 Change Northern 826 843 (2) % Southern 1,150 1,315 (13) % Total 1,976 2,158 (8) % BACKLOG March 31, 2025 March 31, 2024 Dollars Average Dollars Average Region Units (millions) Sales Price Units (millions) Sales Price Northern 1,375 $            765 $     556,000 1,567 $           822 $     525,000 Southern 1,472 $            795 $     540,000 1,824 $           967 $     530,000 Total 2,847 $         1,559 $     548,000 3,391 $        1,789 $     528,000 LAND POSITION SUMMARY March 31, 2025 March 31, 2024 Lots Lots Under Lots Lots Under Region Owned Contract Total Owned Contract Total Northern 6,855 9,501 16,356 7,005 9,279 16,284 Southern 18,355 16,386 34,741 16,821 14,352 31,173 Total 25,210 25,887 51,097 23,826 23,631 47,457 SOURCE M/I Homes, Inc. 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