Forestar Group Inc. (NYSE: FOR) has reported its fiscal 2024 second-quarter results, showing significant growth compared to the same period last year. Here are the key highlights:
- Net income increased by 67% to $45.0 million, or $0.89 per diluted share, compared to $26.9 million, or $0.54 per diluted share, in the second quarter of fiscal 2023.
- Pre-tax income grew by 64% to $58.9 million, with a pre-tax profit margin of 17.6%.
- Consolidated revenues rose by 11% to $333.8 million.
- Residential lots sold increased by 10% to 3,289 lots.
- Owned and controlled lots surged by 26% to 96,100 lots.
- Return on equity expanded by 320 basis points to 14.9% for the trailing twelve months ended March 31, 2024.
- Book value per share increased by 16% to $29.09.
In the six months ended March 31, 2024, net income soared by 74% to $83.2 million, or $1.65 per diluted share, compared to $47.7 million, or $0.95 per diluted share, in the same period of fiscal 2023. Pre-tax income for the six months ended March 31, 2024, increased by 73% to $110.1 million from $63.8 million in the same period of fiscal 2023. Revenues for the first six months of fiscal 2024 climbed by 23% to $639.7 million from $518.2 million in the same period of fiscal 2023.
Forestar's lot position at March 31, 2024, was 96,100 lots, reflecting a substantial increase from the 76,400 lots at March 31, 2023. Of the company’s owned lot position at March 31, 2024, 18,000 lots, or 31%, were under contract to be sold, representing approximately $1.6 billion of future revenue.
The company's return on equity was 14.9% for the trailing twelve months ended March 31, 2024, compared to 11.7% for the prior year period.
Forestar's strong financial performance and operational growth demonstrate its ability to capitalize on the demand for finished lots in the homebuilding industry. With a focus on delivering between 14,500 and 15,500 lots in fiscal 2024, generating $1.4 billion to $1.5 billion in revenue, the company remains committed to consolidating market share and driving future growth.
The company ended the quarter with a healthy financial position, including $416.2 million of unrestricted cash and $382.0 million of available borrowing capacity on its senior unsecured revolving credit facility, totaling $798.2 million in liquidity. At March 31, 2024, the company's net debt to total capital ratio was 16.4%.
Forestar Group Inc., headquartered in Arlington, Texas, operates in 57 markets and 23 states, delivering more than 15,200 residential lots during the twelve-month period ended March 31, 2024. It is a majority-owned subsidiary of D.R. Horton, the largest homebuilder by volume in the United States since 2002. Following these announcements, the company's shares moved -8.9%, and are now trading at a price of $31.12. Check out the company's full 8-K submission here.
