NEWPORT BEACH, Calif., Feb. 28, 2000 (PRIMEZONE) -- William Lyon Homes (NYSE:WLS) today reported net income for the fourth quarter ended December 31, 1999 of $21,884,000, or $2.10 per share, on sales of $173,605,000, as compared with net income of $8,640,000, or $0.83 per share, on sales of $131,765,000 for the comparable period a year ago. Income before income taxes and extraordinary item for the quarter ended December 31, 1999 was $15,705,000 as compared with $7,772,000 for the comparable period a year ago. Sales of homes were $165,153,000 for the quarter ended December 31, 1999, up 35 percent from $122,760,000 for the comparable period a year ago. The results for the quarter ended December 31, 1999 include an extraordinary gain from retirement of debt of $2,411,000, or $0.23 per share, after applicable income taxes, as compared with $2,219,000, or $0.21 per share, after applicable income taxes, for the comparable period a year ago.
For the year ended December 31, 1999, the Company reported net income of $47,477,000, or $4.55 per share, on sales of $439,981,000, as compared with a net income of $9,855,000, or $0.94 per share, on sales of $368,282,000 for the comparable period a year ago. Income before income taxes and extraordinary item for the year ended December 31, 1999 was $43,497,000 as compared with $8,305,000 for the comparable period a year ago. Sales of homes were $426,839,000 for the year ended December 31, 1999, up 23 percent from $348,352,000 for the comparable period a year ago. The results for the year ended December 31, 1999 include an extraordinary gain from the retirement of debt of $4,200,000, or $0.40 per share, after applicable income taxes, as compared with $2,741,000, or $0.26 per share, after applicable income taxes, for the comparable period a year ago.
Homes sold, closed and in backlog for the Company and its unconsolidated joint ventures as of and for the periods presented are as follows:
As of and for As of and for
the Three the Year
Ended December 31, Ended December 31,
1999 1998 1999 1998
Number of homes sold
Company 408 350 1,683 1,937
Unconsolidated joint
ventures 171 79 602 202
---- ---- ----- -----
Combined total 579 429 2,285 2,139
==== ==== ===== =====
Number of homes closed
Company 748 628 2,028 1,834
Unconsolidated joint
ventures 234 69 590 91
---- ---- ----- -----
Combined total 982 697 2,618 1,925
==== ==== ===== =====
Backlog of homes sold but
not closed at end
of period
Company 427 499 427 499
Unconsolidated joint
ventures 185 118 185 118
---- ---- ----- -----
Combined total 612 617 612 617
==== ==== ===== =====
Dollar amount of backlog
of homes sold but not
closed at end of period
(in millions):
Company $100.6 $111.8 $100.6 $111.8
Unconsolidated joint
ventures 85.2 53.3 85.2 53.3
------ ------ ------ ------
Combined total $185.8 $165.1 $185.8 $165.1
====== ====== ====== ======
Net new home orders for the quarter ended December 31, 1999 increased 35 percent to 579 units from 429 units a year ago. For the fourth quarter of 1999, net new home orders increased 30 percent to 579 units from 447 units in the third quarter of 1999. The number of homes closed in the fourth quarter of 1999 was up 41 percent to 982 from 697 in the fourth quarter of 1998. The backlog of homes sold as of December 31, 1999 was 612, down 0.8 percent from 617 units a year earlier, and down 11 percent from 687 units at September 30, 1999.
The dollar amount of backlog of homes sold but not closed as of December 31, 1999 was $185,800,000, as compared with $165,100,000 as of December 31, 1998 and $179,500,000 as of September 30, 1999.
The increase in net new home orders and number of homes closed for the three months ended December 31, 1999 as compared to the three months ended December 31, 1998 is primarily the result of an increase in the number of sales locations to 50 at December 31, 1999 from 46 at December 31, 1998 and the result of improved market conditions in substantially all of the Company's markets.
William Lyon, Chairman and Chief Executive Officer, stated "The results for the fourth quarter which now reflect the combined operations of William Lyon Homes and Presley Homes are extremely gratifying. Beginning with the second quarter of 1998, the Company has reported profits for seven consecutive quarters; debt levels have been reduced from approximately $241 million at March 31, 1998 to approximately $177 million at December 31, 1999 and stockholder's equity has improved by $62 million from a deficit of approximately $9 million at March 31, 1998 to a positive balance of approximately $53 million at December 31, 1999."
Wade Cable, President and Chief Operating Officer, stated that "The home closings totaling 982 for the fourth quarter of 1999 are the highest in the Company's history. The backlog of orders at February 20, 2000 has increased to 819."
The Company also reported that for purposes of the Indenture governing its Senior Notes, EBITDA (earnings before interest, taxes, depreciation and amortization) was $60,410,000 for the fourth quarter of 1999 as compared to $50,119,000 for the fourth quarter of 1998. EBITDA coverage of interest incurred for the three months ended December 31, 1999 was 8.81, as compared to 6.99 for the three months ended December 31, 1998. EBITDA after development expenditures amounted to ($50,996,000) for the fourth quarter of 1999 as compared to $44,644,000 for the fourth quarter of 1998.
William Lyon Homes is one of California's oldest and largest homebuilders in the Southwest with development communities in California, Arizona, New Mexico and Nevada. Founded in 1956, the Company has built and sold more than 49,000 homes and as of December 31, 1999 has 50 sales locations. The Company's corporate headquarters are located in Newport Beach, California.
Certain statements contained in this release that are not historical information contain forward-looking statements. The forward-looking statements involve risks and uncertainties and actual results may differ materially from those projected or implied. Further, certain forward-looking statements are based on assumptions of future events which may not prove to be accurate. Factors that may impact such forward-looking statements include, among others, changes in general economic conditions and in the markets in which the Company competes, changes in interest rates and competition, as well as the other factors discussed in the Company's reports filed with the Securities and Exchange Commission.
WILLIAM LYON HOMES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except per common share amounts)
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
1999 1998 1999 1998
Sales
Homes $165,153 $122,760 $426,839 $348,352
Lots, land and other 8,452 9,005 13,142 19,930
-------- --------- -------- --------
173,605 131,765 439,981 368,282
-------- --------- -------- --------
Operating costs
Cost of sales - homes (140,965) (103,588) (357,153) (297,781)
Cost of sales - lots,
land and other (8,409) (9,614) (13,223) (20,992)
Sales and marketing (6,730) (6,283) (19,387) (21,463)
General and
administrative (6,551) (5,821) (19,368) (15,965)
Amortization
of goodwill (307) - (307) -
-------- -------- -------- --------
(162,962) (125,306) (409,438) (356,201)
-------- -------- -------- --------
Equity in income of
unconsolidated
joint ventures 5,581 3,153 17,859 3,499
-------- --------- -------- --------
Operating income 16,224 9,612 48,402 15,580
Interest expense,
net of amounts
capitalized (1,600) (2,141) (6,153) (9,214)
Financial advisory
expenses - (1,286) (2,197) (1,286)
Other income
(expense), net 1,081 1,587 3,445 3,225
-------- --------- -------- --------
Income before
income taxes and
extraordinary item 15,705 7,772 43,497 8,305
Benefit (provision)
for income taxes 3,768 (1,351) (220) (1,191)
-------- --------- -------- --------
Income before
extraordinary item 19,473 6,421 43,277 7,114
Extraordinary item -
gain from retirement
of debt, net of
applicable
income taxes 2,411 2,219 4,200 2,741
-------- --------- -------- --------
Net income $ 21,884 $ 8,640 $ 47,477 $ 9,855
======== ========= ========= =========
Basic and diluted
earnings per common
share (1)
Before extraordinary
item $ 1.87 $ 0.62 $ 4.15 $ 0.68
Extraordinary
item 0.23 0.21 0.40 0.26
------- --------- -------- --------
After extraordinary
item $ 2.10 $ 0.83 $ 4.55 $ 0.94
======== ========== ========= =========
(1) Reflects adjustment for all periods presented for the retroactive
effect of the merger with a wholly-owned subsidiary and the
conversion of each share of previously outstanding Series A and
Series B Common Stock into 0.2 common shares of the surviving
company.
WILLIAM LYON HOMES
CONSOLIDATED BALANCE SHEETS
(in thousands except number of shares and par value per share)
December
1999 1998
(unaudited)
ASSETS
Cash and cash equivalents $ 2,154 $ 23,955
Receivables 12,063 8,613
Real estate inventories 184,271 174,502
Investments in and advances to
unconsolidated joint ventures 50,282 30,462
Property and equipment,
less accumulated
depreciation of $4,167 and
$3,156 at December 31,
1999 and December 31, 1998,
respectively 2,183 2,912
Deferred loan costs 1,726 3,381
Goodwill 8,382 -
Other assets 17,422 2,579
---------- -----------
$278,483 $246,404
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $ 15,653 $ 17,364
Accrued expenses 32,899 27,823
Notes payable 76,630 55,393
12 1/2% Senior Notes due 2001 100,000 140,000
-------- --------
225,182 240,580
-------- --------
Stockholders' equity (1)
Common stock, par value
$.01 per share; 30,000,000 shares
authorized; 10,439,135 shares issued
and outstanding at December 31, 1999
and December 31, 1998, respectively 104 104
Additional paid-in capital 116,667 116,667
Accumulated deficit
from January 1, 1994 (63,470) (110,947)
-------- --------
53,301 5,824
-------- --------
$278,483 $246,404
======== ========
(1) Reflects adjustment for all periods presented for the
retroactive effect of the merger with a wholly-owned
subsidiary and the conversion of each share of previously
outstanding Series A and Series B Common Stock into 0.2
common shares of the surviving company.
WILLIAM LYON HOMES
SUPPLEMENTAL FINANCIAL INFORMATION
(dollars in thousands)
(unaudited)
The following table sets forth certain selected unaudited financial
data regarding the Company's cash flow for the purposes of the
Indenture governing the Company's Senior Notes:
Three Months Ended Year Ended
December 31, December 31,
1999 1998 1999 1998
EBIT $ 18,831 $ 18,647 $ 59,299 $ 44,768
Amortization of Non-Cash
Costs to Cost of Sales,
excluding interest amortized
to cost of sales 40,940 31,243 108,765 96,941
Depreciation and amortization 639 229 1,518 1,040
-------- -------- --------- --------
EBITDA $ 60,410 $ 50,119 $169,582 $142,749
======== ======== ======== ========
Development expenditures:
Lot and amenity development $(20,114) $(12,768) $(48,407) $(47,954)
Land acquisitions (82,534) (7,186) (120,753) (30,367)
Net change in housing
inventory (601) 18,278 2,676 (12,022)
Investment in unconsolidated
joint ventures (8,157) (3,799) (1,961) 11,772
-------- -------- --------- --------
Total development
expenditures (111,406) (5,475) (168,445) (78,571)
-------- -------- -------- --------
EBITDA after development
expenditures $(50,996) $ 44,644 $ 1,137 $ 64,178
======== ======== ======== ========
Interest expensed and
amortized to cost of sales:
Interest incurred $ 6,855 $ 7,167 $ 24,500 $ 31,474
Less capitalized interest (5,256) (5,027) (18,347) (22,261)
--------- --------- --------- ---------
Interest expensed 1,599 2,140 6,153 9,213
Amortization of capitalized
interest included in
cost of sales 5,235 9,703 23,771 27,899
--------- --------- --------- ---------
Total interest expensed
and amortized to cost
of sales $ 6,834 $ 11,843 $ 29,924 $ 37,112
========= ======== ======== ========
Interest incurred $ 6,855 $ 7,167 $ 24,500 $ 31,474
========= ========= ========= =======
EBITDA/Interest incurred 8.81x 6.99x 6.92x 4.54x
Contact: Investor Relations
W. Douglass Harris
William Lyon Homes
(949) 833-3600
Media Relations
Steven D. Stern
Pondel/Wilkinson Group
(310) 207-9300