Hovnanian Enterprises Reports 15.3% Revenue Growth

Hovnanian Enterprises, Inc. has reported its fiscal first quarter results, showing significant growth in various key metrics. The company, a leading national homebuilder, reported a 15.3% increase in total revenues to $594.2 million, including 1,063 deliveries, in the first quarter of fiscal 2024. This growth was accompanied by a 48% increase in net contracts per community year-over-year and an 80% increase in income before taxes compared to the same quarter in the prior year.

The company also highlighted its highest quarterly land and land development spend in 57 quarters, amounting to $230 million. This aggressive spending reflects Hovnanian's commitment to expanding its operations and investing in future growth opportunities.

Ara K. Hovnanian, Chairman of the Board, President, and Chief Executive Officer, expressed his satisfaction with the company's performance, stating, "We are off to a solid start to fiscal 2024, with 80% year-over-year growth in our income before income taxes for the first quarter. Excluding incremental phantom stock expense, we were at or above the high end of the guidance range for our first quarter total revenues, adjusted income before income taxes, and adjusted EBITDA."

Hovnanian also emphasized the strong demand for new homes, citing a 48% growth in consolidated contracts per community during the first quarter of fiscal 2024. This demand was supported by a 16% year-over-year increase in total internet leads in January 2024, further bolstering the company's confidence in the strength of the market.

Looking ahead, Hovnanian expressed optimism for the 2024 spring selling season, attributing it to positive trends impacting the company and the industry. He noted, "All these positive trends impacting our company and our industry leave us optimistic of the trajectory of the 2024 spring selling season over the short term and the general direction of the housing market over the longer term."

In terms of financial guidance for the second quarter of fiscal 2024, the company expects total revenues to be between $675 million and $775 million, with adjusted homebuilding gross margin projected to be between 21.5% and 23.0%. Additionally, adjusted income before income taxes is anticipated to fall between $45 million and $55 million, with adjusted EBITDA expected to range from $80 million to $90 million.

Hovnanian Enterprises' stock has seen a decline of 8.0%, with shares now trading at $150.86.

The company's full 8-K submission is available here.

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