Century Communities Inc (CCS) Q4 2024 Earnings Call Highlights: Record Deliveries and Revenue ...
Community Count: Increased 28% year over year to 322 communities.
Fourth Quarter Deliveries: 3,198 homes, a quarterly record.
Home Sales Revenue: $1.2 billion for the fourth quarter, a quarterly record.
Adjusted Gross Margin: Increased by 80 basis points to 23.3% for the full year 2024.
SG&A as a Percentage of Revenue: Reduced by 40 basis points for the full year 2024.
Adjusted Net Income: Increased by 36% year over year for the full year 2024.
Fourth Quarter Adjusted Net Income: Up 18% year over year.
Net New Contracts: Fourth quarter increased by 5% year over year to 2,467.
Average Sales Price: Approximately $390,000 for both the fourth quarter and full year 2024.
Fourth Quarter Pretax Income: $135.2 million.
Fourth Quarter Net Income: $102.7 million or $3.20 per diluted share.
Fourth Quarter Adjusted Net Income: $112 million or $3.49 per diluted share.
Fourth Quarter EBITDA: $160.2 million.
Fourth Quarter Adjusted EBITDA: $172.6 million.
Backlog of Sold Homes: 850 units valued at $351.2 million.
Fourth Quarter Homebuilding Gross Margin: 20.6%.
SG&A as a Percent of Home Sales Revenue: 11.5% in the fourth quarter.
Financial Services Revenue: $26.2 million in the fourth quarter.
Fourth Quarter Tax Rate: 24%.
Net Homebuilding Debt to Net Capital Ratio: Improved to 27.4% at quarter end.
Book Value Per Share: $84.65, a 13% year-over-year increase.
Stockholders' Equity: $2.6 billion at quarter end.
Liquidity: $918 million at quarter end.
2025 Delivery Guidance: Expected to be in the range of 11,700 to 12,400 homes.
2025 Home Sales Revenue Guidance: Expected to be in the range of $4.5 billion to $4.8 billion.
Warning! GuruFocus has detected 2 Warning Sign with CCS.
Release Date: January 29, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Century Communities Inc (NYSE:CCS) achieved record deliveries of 11,007 homes in 2024, a 15% increase year over year.
The company set a new record with a community count of 322, marking a 28% increase from the previous year.
Adjusted net income for the full year increased by 36%, with a fourth-quarter rise of 18%.
Century Communities Inc (NYSE:CCS) successfully reduced SG&A as a percentage of wholesale revenues by 40 basis points.
The company repurchased over 3% of its outstanding shares and increased its quarterly dividend by 30% in 2024.
The average sales price remained flat at approximately $390,000, indicating potential challenges in increasing home prices.
Incentives on new orders increased to approximately 900 basis points in the fourth quarter, reflecting pressure to maintain sales pace amid elevated mortgage rates.
The first quarter of 2025 is expected to see a sequential decline in deliveries due to typical seasonality.
Homebuilding gross margin decreased to 20.6% in the fourth quarter, down from 21.7% in the prior quarter.
The company anticipates a potential impact on gross margins from mortgage rates and incentive levels in the near term.
Q: Can you discuss any differences in traffic levels or incentives between Century Communities and Century Complete, and how do you expect the mix to look in 2025? A: John Dixon, Interim CFO, noted that there are no significant differences in incentives between the brands, though there might be slightly more on the mortgage financing side for Century Complete. Both brands are expected to grow, with no significant changes in mix anticipated for 2025.
Q: What percentage of homes were sold and closed within the quarter, and do you expect this percentage to increase next year? A: John Dixon stated that slightly above 60% of homes were sold and closed within the quarter. This percentage has been consistent, ranging from the high 50s to high 60s, and is expected to remain stable given the company's spec model and stabilized cycle times.
Q: What are the current incentive levels on orders, and do you expect the same sales absorption level in 2025 as in 2024? A: Robert Francescon, CEO, mentioned that current incentives are around 900 basis points, consistent with Q4. The company anticipates maintaining the same sales absorption level of approximately 3.2 times, with growth driven by community count.
Q: Are there any plans for more M&A activity in 2025, and what is the strategy regarding acquisitions? A: Robert Francescon explained that the two acquisitions in 2024 were within existing markets to deepen presence. The company continues to look at M&A opportunities with stringent underwriting criteria, but any future deals will depend on market conditions.
Q: How is the company addressing the pace versus price strategy, especially with flat absorption guidance for 2025? A: John Dixon highlighted the benefits of the spec model, allowing for inventory adjustments based on demand. The company remains bullish on demand and will adjust pace as needed. Cost stability and affordability measures, such as moderating square footage, are key strategies.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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