Hovnanian Enterprises Reports Fiscal 2013 Results

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| Source: Hovnanian Enterprises, Inc.

RED BANK, N.J., Dec. 12, 2013 (GLOBE NEWSWIRE) -- Hovnanian Enterprises, Inc. (NYSE:HOV), a leading national homebuilder, reported results for its fourth quarter and twelve months ended October 31, 2013.

RESULTS FOR THE THREE AND TWELVE MONTH PERIODS ENDED OCTOBER 31, 2013:

  • Total revenues were $591.7 million during the fiscal 2013 fourth quarter, an increase of 21.5% compared with $487.0 million in last year's fourth quarter. For the full year, total revenues increased 24.2% to $1.85 billion compared with $1.49 billion in the prior year.
     
  • Homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, increased 430 basis points to 22.6% for the fiscal 2013 fourth quarter compared with 18.3% during the fourth quarter of 2012, and was up 230 basis points compared to the 20.3% reported for the third quarter of 2013. For the full year ended October 31, 2013, homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, increased 230 basis points to 20.1% compared with 17.8% in all of fiscal 2012.
     
  • Pre-tax income for the three months ended October 31, 2013 was $35.9 million, excluding land-related charges and loss on extinguishment of debt, compared with $8.1 million in the fourth quarter of the prior year. For all of 2013, pre-tax income, excluding land-related charges, expenses associated with the debt exchange offer and loss on extinguishment of debt, was $27.7 million compared with a pre-tax loss of $55.0 million in fiscal 2012.
     
  • Net income was $32.8 million, or $0.21 per diluted common share, for the fourth quarter of fiscal 2013, compared with a net loss of $84.4 million, or $0.59 per common share, in the fourth quarter of the prior year. For the year ended October 31, 2013, net income was $31.3 million, or $0.22 per diluted common share, compared with a net loss of $66.2 million, or $0.52 per common share, for all of last year.
     
  • Deliveries, including unconsolidated joint ventures, were 1,816 homes during the fourth quarter of 2013, up 3.8% compared with 1,750 homes in the same period of the prior year. For the twelve months ended October 31, 2013, deliveries, including unconsolidated joint ventures, were 5,930 homes compared with 5,356 homes during the twelve month period a year ago, an increase of 10.7%.
     
  • The dollar value of net contracts, including unconsolidated joint ventures, during the fiscal 2013 fourth quarter decreased 4.5% to $490.5 million compared with $513.4 million in last year's fourth quarter. The number of net contracts decreased 8.9% to 1,315 homes in the fiscal 2013 fourth quarter from 1,443 homes in the prior year's fourth quarter. The dollar value of net contracts, including unconsolidated joint ventures, for all of fiscal 2013 increased 14.6% to $2.20 billion compared with $1.92 billion during all of 2012. The number of net contracts increased 5.8% to 6,177 homes for the year ended October 31, 2013 from 5,838 homes in fiscal 2012.
     
  • Contract backlog, as of October 31, 2013, including unconsolidated joint ventures, was $848.4 million for 2,392 homes, which was an increase of 14.3% and 11.5%, respectively, compared to October 31, 2012.
     
  • Total interest expense as a percentage of total revenues declined 150 basis points to 6.7% for the fourth quarter of fiscal 2013 compared with 8.2% in the fourth quarter of the prior year. For all of fiscal 2013, total interest expense as a percentage of total revenues declined 250 basis points to 7.8% compared with 10.3% in the prior year.
     
  • Total SG&A was $63.0 million, or 10.6% of total revenues, during the three months ended October 31, 2013 compared to $48.7 million, or 10.0% of total revenues, in the fourth quarter of the prior year. The quarter included $8.5 million of unusually high expenses due to a substantial increase in our construction defect reserves based on an annual actuarial study, as well as a reserve for a receivable from a prior year land sale. In fiscal 2013, total SG&A was $220.2 million, or 11.9% of total revenues, compared with $190.3 million or 12.8% of total revenues in the previous year.
     
  • Adjusted EBITDA increased to $77.4 million for the fourth quarter ended October 31, 2013 compared to $50.2 million in last year's fourth quarter. During all of fiscal 2013, Adjusted EBITDA was $179.6 million compared with $107.4 million in the prior year.
     
  • The contract cancellation rate, including unconsolidated joint ventures, for the three months ended October 31, 2013 was 23%, compared with 23% during the same quarter a year ago.
     
  • The valuation allowance was $927.1 million as of October 31, 2013. The valuation allowance is a non-cash reserve against the tax assets for GAAP purposes. For tax purposes, the tax deductions associated with the tax assets may be carried forward for 20 years from the date the deductions were incurred.

LIQUIDITY AND INVENTORY AS OF OCTOBER 31, 2013:

  • During the fourth quarter of fiscal 2013, $125.4 million was spent on land and land development. Homebuilding cash was $324.3 million as of October 31, 2013, including $5.2 million of restricted cash required to collateralize letters of credit, compared to $226.7 million and $289.0 million at the end of July 31, 2013 and October 31, 2012, respectively. In addition to the homebuilding cash, there was $49.2 million of availability under the revolving credit facility as of October 31, 2013.
     
  • As of October 31, 2013, the land position, including unconsolidated joint ventures, was 34,462 lots, consisting of 16,311 lots under option and 18,151 owned lots, an increase of 4,843 lots compared with a total of 29,619 lots as of October 31, 2012.
     
  • We continued our successful partnership with GSO Capital Partners LP, the credit arm of The Blackstone Group, by announcing a $150 million increase of our land banking arrangement, which brings the total since July 2012 to $400 million.

COMMENTS FROM MANAGEMENT:

"We are pleased to report a year of solid profitability, driven by revenue growth, gross margin improvement and operating efficiencies," stated Ara K. Hovnanian, Chairman of the Board, President and Chief Executive Officer. "Although our sales slowed from July through September due to the adverse impacts of higher mortgage rates, the sequester and the government shutdown, we are happy to report that our sales improved back to prior year levels in October and exceeded last year's levels in November. Entering 2014 with a higher backlog, gross margin and community count, gives us optimism that, excluding any expenses related to early retirement of debt, fiscal 2014 should result in greater levels of profitability and continued leveraging of our fixed costs. Further, we continue to believe that household formations, the primary driver of housing demand, will ultimately lead to increased demand for new homes and we continue to believe that our industry is still in the early stages of a housing recovery."

WEBCAST INFORMATION:

Hovnanian Enterprises will webcast its fiscal 2013 fourth quarter financial results conference call at 11:00 a.m. E.T. on Thursday, December 12, 2013. The webcast can be accessed live through the "Investor Relations" section of Hovnanian Enterprises' Website at http://www.khov.com. For those who are not available to listen to the live webcast, an archive of the broadcast will be available under the "Audio Archives" section of the Investor Relations page on the Hovnanian Website at http://www.khov.com. The archive will be available for 12 months.

ABOUT HOVNANIAN ENTERPRISES®, INC.:

Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, Minnesota, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian® Homes®, Brighton Homes, Parkwood Builders, Town & Country Homes and Oster Homes. As the developer of K. Hovnanian's® Four Seasons communities, the Company is also one of the nation's largest builders of active adult homes.

Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company's 2012 annual report, can be accessed through the "Investor Relations" section of the Hovnanian Enterprises' website at http://www.khov.com. To be added to Hovnanian's investor e-mail or fax lists, please send an e-mail to IR@khov.com or sign up at http://www.khov.com.

NON-GAAP FINANCIAL MEASURES:

Consolidated earnings before interest expense and income taxes ("EBIT") and before depreciation and amortization ("EBITDA") and before inventory impairment loss and land option write-offs, expenses associated with debt exchange offer and loss on extinguishment of debt ("Adjusted EBITDA") are not U.S. generally accepted accounting principles (GAAP) financial measures. The most directly comparable GAAP financial measure is net income (loss). The reconciliation of EBIT, EBITDA and Adjusted EBITDA to net income (loss) is presented in a table attached to this earnings release.

Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Loss on Extinguishment of Debt is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Income (Loss) Before Income Taxes. The reconciliation of Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Loss on Extinguishment of Debt to Income (Loss) Before Income Taxes is presented in a table attached to this earnings release.

FORWARD-LOOKING STATEMENTS

All statements in this press release that are not historical facts should be considered as "forward-looking statements." Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Although we believe that our plans, intentions and expectations reflected in, or suggested by, such forward looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic, industry and business conditions and impacts of the sustained homebuilding downturn, (2) adverse weather and other environmental conditions and natural disasters, (3) changes in market conditions and seasonality of the Company's business, (4) changes in home prices and sales activity in the markets where the Company builds homes, (5) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, tax laws, and the environment, (6) fluctuations in interest rates and the availability of mortgage financing, (7) shortages in, and price fluctuations of, raw materials and labor, (8) the availability and cost of suitable land and improved lots, (9) levels of competition, (10) availability of financing to the Company, (11) utility shortages and outages or rate fluctuations, (12) levels of indebtedness and restrictions on the Company's operations and activities imposed by the agreements governing the Company's outstanding indebtedness, (13) the Company's sources of liquidity, (14) changes in credit ratings, (15) availability of net operating loss carryforwards, (16) operations through joint ventures with third parties, (17) product liability litigation, warranty claims and claims by mortgage investors, (18) successful identification and integration of acquisitions, (19) significant influence of the Company's controlling stockholders, (20) changes in tax laws affecting the after-tax costs of owning a home, (21) geopolitical risks, terrorist acts and other acts of war, and (22) other factors described in detail in the Company's Annual Report on Form 10-K for the year ended October 31, 2012. Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

(Financial Tables Follow)

Hovnanian Enterprises, Inc.
October 31, 2013
Statements of Consolidated Operations
(Dollars in Thousands, Except Per Share Data)
  Three Months Ended Twelve Months Ended
  October 31, October 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
Total Revenues $591,687 $487,045 $1,851,253 $1,485,353
Costs and Expenses (a)  562,547  487,296 1,840,598 1,562,936
Loss on Extinguishment of Debt  (760)  (87,033)  (760)  (29,066)
Income from Unconsolidated Joint Ventures 5,234 3,077 12,040 5,401
Income (Loss) Before Income Taxes 33,614  (84,207) 21,935  (101,248)
Income Tax Provision (Benefit) 795 203 (9,360)  (35,051)
Net Income (Loss) $32,819 $(84,410) $31,295 $(66,197)
         
Per Share Data:        
Basic:        
Income (Loss) Per Common Share $0.22 $(0.59) $0.22 $(0.52)
Weighted Average Number of Common Shares Outstanding (b)  145,821  142,249  145,087  126,350
Assuming Dilution:        
Income (Loss) Per Common Share $0.21 $(0.59) $0.22 $(0.52)
Weighted Average Number of Common Shares Outstanding (b)  162,100  142,249  162,329  126,350
         
(a) Includes inventory impairment loss and land option write-offs.
(b) For periods with a net loss, basic shares are used in accordance with GAAP rules.
         
         
Hovnanian Enterprises, Inc.
October 31, 2013
Reconciliation of Income (Loss) Before Income Taxes Excluding Land-Related
Charges, Expenses Associated with the Debt Exchange Offer and
Loss on Extinguishment of Debt to Income (Loss) Before Income Taxes
(Dollars in Thousands)
         
  Three Months Ended Twelve Months Ended
  October 31, October 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
Income (Loss) Before Income Taxes $33,614 $(84,207) $21,935 $(101,248)
Inventory Impairment Loss and Land Option Write-Offs 1,486 5,300 4,965 12,530
Expenses Associated with the Debt Exchange Offer -- -- -- 4,694
Loss on Extinguishment of Debt 760 87,033 760 29,066
Income (Loss) Before Income Taxes Excluding        
Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Loss on Extinguishment of Debt (a) $35,860 $8,126 $27,660 $(54,958)
         
(a) Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Loss on Extinguishment of Debt is a non-GAAP Financial measure. The most directly comparable GAAP financial measure is Income (Loss) Before Income Taxes.
 
Hovnanian Enterprises, Inc.
October 31, 2013
Gross Margin
(Dollars in Thousands)
  Homebuilding Gross Margin Homebuilding Gross Margin
  Three Months Ended Twelve Months Ended
  October 31, October 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
Sale of Homes $578,094 $469,275 $1,784,327 $1,405,580
Cost of Sales, Excluding Interest (a)  447,723  383,275  1,426,032  1,155,643
Homebuilding Gross Margin, Excluding Interest 130,371  86,000 358,295 249,937
Homebuilding Cost of Sales Interest  16,850  14,014 51,939  48,843
Homebuilding Gross Margin, Including Interest $113,521 $71,986 $306,356 $201,094
         
Gross Margin Percentage, Excluding Interest 22.6% 18.3% 20.1% 17.8%
Gross Margin Percentage, Including Interest 19.6% 15.3% 17.2% 14.3%
         
  Land Sales Gross Margin Land Sales Gross Margin
  Three Months Ended Twelve Months Ended
  October 31, October 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
Land Sales $2,493 $3,051 $17,711 $31,788
Cost of Sales, Excluding Interest (a)  1,959 2,358 16,012  24,158
Land Sales Gross Margin, Excluding Interest 534 693 1,699 7,630
Land Sales Interest 69  433  291 5,695
Land Sales Gross Margin, Including Interest $465 $260 $1,408 $1,935
         
(a) Does not include cost associated with walking away from land options or inventory impairment losses which are recorded as Inventory impairment loss and land option write-offs in the Consolidated Statements of Operations.
 
 
Hovnanian Enterprises, Inc.
October 31, 2013
Reconciliation of Adjusted EBITDA to Net Income (Loss)
(Dollars in Thousands)
  Three Months Ended Twelve Months Ended
  October 31, October 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
Net Income (Loss) $32,819 $(84,410) $31,295 $(66,197)
Income Tax Provision (Benefit) 795 203 (9,360) (35,051)
Interest Expense 39,682 39,701 143,574 152,433
EBIT (a) 73,296 (44,506) 165,509 51,185
Depreciation 930 1,513 4,712 6,223
Amortization of Debt Costs 940 905 3,659 3,713
EBITDA (b) 75,166 (42,088) 173,880 61,121
Inventory Impairment Loss and Land Option Write-offs 1,486 5,300 4,965 12,530
Expenses Associated with Debt Exchange Offer  --  --  --  4,694
Loss on Extinguishment of Debt 760  87,033 760  29,066
Adjusted EBITDA (c) $77,412 $50,245 $179,605 $107,411
         
Interest Incurred $34,798 $36,733 $132,611 $147,048
         
Adjusted EBITDA to Interest Incurred 2.22 1.37 1.35 0.73
         
(a) EBIT is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net income (loss). EBIT represents earnings before interest expense and income taxes.
(b) EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net income (loss). EBITDA represents earnings before interest expense, income taxes, depreciation and amortization.
(c) Adjusted EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net income (loss). Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation, amortization, inventory impairment loss and land option write-offs, expenses associated with debt exchange offer and loss on extinguishment of debt.
 
 
Hovnanian Enterprises, Inc.
October 31, 2013
Interest Incurred, Expensed and Capitalized
(Dollars in Thousands)
  Three Months Ended Twelve Months Ended
  October 31, October 31,
  2013 2012 2013 2012
  (Unaudited) (Unaudited)
Interest Capitalized at Beginning of Period $109,977 $119,024 $116,056 $121,441
Plus Interest Incurred  34,798  36,733  132,611 147,048
Less Interest Expensed  39,682  39,701  143,574 152,433
Interest Capitalized at End of Period (a) $105,093 $116,056 $105,093 $116,056
         
(a) Capitalized interest amounts are shown gross before allocating any portion of inventory impairments to capitalized interest.
 
 
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands)
 
  October 31,
2013
October 31,
2012
  (Unaudited) (1)
ASSETS    
     
Homebuilding:    
Cash $319,142 $258,323
     
Restricted cash and cash equivalents 10,286 41,732
     
Inventories:    
Sold and unsold homes and lots under development 752,749 671,851
     
Land and land options held for future development or sale 225,152 218,996
     
Consolidated inventory not owned:    
Specific performance options 792 --
Other options 100,071 90,619
     
Total consolidated inventory not owned 100,863 90,619
     
Total inventories 1,078,764 981,466
     
Investments in and advances to unconsolidated joint ventures 51,438 61,083
     
Receivables, deposits, and notes – net 45,085 61,794
     
Property, plant, and equipment – net 46,211 48,524
     
Prepaid expenses and other assets 59,351 66,694
     
Total homebuilding 1,610,277 1,519,616
     
Financial services:    
Cash 10,062 14,909
Restricted cash and cash equivalents 21,557 22,470
Mortgage loans held for sale at fair value 112,953 117,024
Other assets 4,281 10,231
     
Total financial services 148,853 164,634
     
Total assets $1,759,130 $1,684,250
 
(1) Derived from the audited balance sheet as of October 31, 2012.
 
 
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Amounts)
 

 
October 31,
2013
October 31,
2012
  (Unaudited) (1)
LIABILITIES AND EQUITY    
     
Homebuilding:    
Nonrecourse mortgages $62,903 $38,302
Accounts payable and other liabilities 307,764 296,510
Customers' deposits 30,119 23,846
Nonrecourse mortgages secured by operating properties 17,733 18,775
Liabilities from inventory not owned 87,866 77,791
     
Total homebuilding 506,385 455,224
     
Financial services:    
Accounts payable and other liabilities 32,874 37,609
Mortgage warehouse lines of credit 91,663 107,485
     
Total financial services 124,537 145,094
     
Notes payable:    
Senior secured notes 978,611 977,369
Senior notes 461,210 458,736
Senior amortizing notes 20,857 23,149
Senior exchangeable notes 66,615 76,851
TEU senior subordinated amortizing notes 2,152 6,091
Accrued interest 28,261 20,199
     
Total notes payable 1,557,706 1,562,395
     
Income taxes payable 3,301 6,882
     
Total liabilities 2,191,929 2,169,595
     
Equity:    
Hovnanian Enterprises, Inc. stockholders' equity deficit:    
Preferred stock, $.01 par value - authorized 100,000 shares; issued and outstanding 5,600 shares with a liquidation preference of $140,000 at October 31, 2013 and at October 31, 2012 135,299 135,299
Common stock, Class A, $.01 par value – authorized 400,000,000 shares; issued 136,306,223 shares at October 31, 2013 and 130,055,304 shares at October 31, 2012 (including 11,760,763 shares at October 31, 2013 and October 31, 2012 held in Treasury) 1,363 1,300
Common stock, Class B, $.01 par value (convertible to Class A at time of sale) – authorized 60,000,000 shares; issued 15,347,615 shares at October 31, 2013 and 15,350,101 shares at October 31, 2012 (including 691,748 shares at October 31, 2013 and October 31, 2012 held in Treasury) 153 154
Paid in capital - common stock 689,727 668,735
Accumulated deficit (1,144,408) (1,175,703)
Treasury stock - at cost (115,360) (115,360)
     
Total Hovnanian Enterprises, Inc. stockholders' equity deficit (433,226) (485,575)
     
Noncontrolling interest in consolidated joint ventures 427 230
     
Total equity deficit (432,799) (485,345)
     
Total liabilities and equity $1,759,130 $1,684,250
 
(1) Derived from the audited balance sheet as of October 31, 2012.
 
 
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Per Share Data)
(Unaudited)
 
  Three Months Ended October 31, Twelve Months Ended October 31,
  2013 2012 2013 2012
Revenues:        
Homebuilding:        
Sale of homes $578,094 $469,275 $1,784,327 $1,405,580
Land sales and other revenues 1,085 5,025 19,199 41,038
         
Total homebuilding 579,179 474,300 1,803,526 1,446,618
Financial services 12,508 12,745 47,727 38,735
         
Total revenues 591,687 487,045 1,851,253 1,485,353
         
Expenses:        
Homebuilding:        
Cost of sales, excluding interest 449,682 385,633 1,442,044 1,179,801
Cost of sales interest 16,919 14,447 52,230 54,538
Inventory impairment loss and land option write-offs 1,486 5,300 4,965 12,530
         
Total cost of sales 468,087 405,380 1,499,239 1,246,869
         
Selling, general and administrative 48,905 37,477 165,809 142,087
         
Total homebuilding expenses 516,992 442,857 1,665,048 1,388,956
         
Financial services 7,854 6,998 29,059 23,648
         
Corporate general and administrative 14,073 11,271 54,357 48,232
         
Other interest 22,763 25,254 91,344 97,895
         
Other operations 865 916  790  4,205
         
Total expenses 562,547 487,296 1,840,598 1,562,936
         
Loss on extinguishment of debt (760) (87,033)  (760)  (29,066)
         
Income from unconsolidated joint ventures 5,234 3,077  12,040  5,401
         
Income (loss) before income taxes 33,614 (84,207) 21,935 (101,248)
         
State and federal income tax provision (benefit):        
State 795 133 518 (35,328)
Federal -- 70   (9,878)  277
         
Total income taxes 795 203  (9,360)  (35,051)
         
Net income (loss) $32,819 $(84,410) $31,295 $(66,197)
         
Per share data:        
Basic:        
Income (loss) per common share $0.22 $(0.59) $0.22 $(0.52)
Weighted-average number of common shares outstanding 145,821 142,249 145,087 126,350
         
Assuming dilution:        
Income (loss) per common share $0.21 $(0.59) $0.22 $(0.52)
Weighted-average number of common shares outstanding 162,100 142,249 162,329 126,350
                   
                   
HOVNANIAN ENTERPRISES, INC.                  
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)   Communities Under Development
(UNAUDITED)   Three Months - October 31, 2013
    Net Contracts(1) Deliveries Contract
    Three Months Ended Three Months Ended Backlog
    Oct 31, Oct 31, Oct 31,
    2013 2012 % Change 2013 2012 % Change 2013 2012 % Change
Northeast                    
(includes unconsolidated joint ventures) Home 162 174 (6.9)% 255 202 26.2% 233 294 (20.7)%
(NJ, PA) Dollars $79,862 $94,408 (15.4)% $129,439 $100,906 28.3% $111,248 $140,954 (21.1)%
  Avg. Price $492,973 $542,575 (9.1)% $507,604 $499,535 1.6% $477,459 $479,435 (0.4)%
Mid-Atlantic                    
(includes unconsolidated joint ventures) Home 184 203 (9.4)% 262 275 (4.7)% 341 366 (6.8)%
(DE, MD, VA, WV) Dollars $90,895 $88,474 2.7% $124,712 $115,262 8.2% $175,390 $163,198 7.5%
  Avg. Price $493,994 $435,833 13.3% $476,000 $419,135 13.6% $514,341 $445,896 15.3%
Midwest                     
(includes unconsolidated joint ventures) Home 219 176 24.4% 256 215 19.1% 654 499 31.1%
(IL, MN, OH) Dollars $64,080 $48,795 31.3% $68,367 $52,299 30.7% $163,933 $115,918 41.4%
  Avg. Price $292,603 $277,244 5.5% $267,057 $243,251 9.8% $250,663 $232,301 7.9%
Southeast                    
(includes unconsolidated joint ventures) Home 155 197 (21.3)% 198 224 (11.6)% 393 283 38.9%
(FL, GA, NC, SC) Dollars $52,301 $54,466 (4.0)% $58,948 $55,639 5.9% $125,734 $79,340 58.5%
  Avg. Price $337,426 $276,477 22.0% $297,718 $248,388 19.9% $319,934 $280,353 14.1%
Southwest                    
(includes unconsolidated joint ventures) Home 501 511 (2.0)% 706 640 10.3% 677 506 33.8%
(AZ, TX) Dollars $149,593 $153,700 (2.7)% $220,947 $170,913 29.3% $216,367 $160,840 34.5%
  Avg. Price $298,589 $300,783 (0.7)% $312,956 $267,052 17.2% $319,597 $317,866 0.5%
West                      
(includes unconsolidated joint ventures) Home 94 182 (48.4)% 139 194 (28.4)% 94 197 (52.3)%
(CA) Dollars $53,749 $73,566 (26.9)% $72,050 $76,143 (5.4)% $55,703 $81,973 (32.0)%
  Avg. Price $571,800 $404,209 41.5% $518,343 $392,490 32.1% $592,590 $416,107 42.4%
Grand Total                    
  Home 1,315 1,443 (8.9)% 1,816 1,750 3.8% 2,392 2,145 11.5%
  Dollars $490,480 $513,409 (4.5)% $674,463 $571,162 18.1% $848,375 $742,223 14.3%
  Avg. Price $372,989 $355,793 4.8% $371,401 $326,378 13.8% $354,672 $346,025 2.5%
Consolidated Total                    
  Home 1,206 1,289 (6.4)% 1,608 1,532 5.0% 2,167 1,889 14.7%
  Dollars $443,345 $440,865 0.6% $578,094 $469,275 23.2% $762,439 $632,318 20.6%
  Avg. Price $367,616 $342,021 7.5% $359,511 $306,315 17.4% $351,841 $334,737 5.1%
Unconsolidated Joint Ventures                    
  Home 109 154 (29.2)% 208 218 (4.6)% 225 256 (12.1)%
  Dollars $47,135 $72,544 (35.0)% $96,369 $101,887 (5.4)% $85,936 $109,905 (21.8)%
  Avg. Price $432,431 $471,065 (8.2)% $463,323 $467,372 (0.9)% $381,938 $429,316 (11.0)%
                     
DELIVERIES INCLUDE EXTRAS  
Notes:        
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.        
 
 
HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE) Communities Under Development
(UNAUDITED)   Twelve Months - October 31, 2013
    Net Contracts(1) Deliveries Contract
    Twelve Months Ended Twelve Months Ended Backlog
    Oct 31, Oct 31, Oct 31,
    2013 2012 % Change 2013 2012 % Change 2013 2012 % Change
Northeast                    
(includes unconsolidated joint ventures) Home 659 646 2.0% 720 718 0.3% 233 294 (20.7)%
(NJ, PA) Dollars $334,072 $333,788 0.1% $363,777 $356,611 2.0% $111,248 $140,954 (21.1)%
  Avg. Price $506,938 $516,700 (1.9)% $505,246 $496,673 1.7% $477,459 $479,435 (0.4)%
Mid-Atlantic                    
(includes unconsolidated joint ventures) Home 883 828 6.6% 908 832 9.1% 341 366 (6.8)%
(DE, MD, VA, WV) Dollars $425,970 $352,048 21.0% $413,780 $342,802 20.7% $175,390 $163,198 7.5%
  Avg. Price $482,412 $425,179 13.5% $455,705 $412,022 10.6% $514,341 $445,896 15.3%
Midwest                    
(includes unconsolidated joint ventures) Home 949 814 16.6% 794 615 29.1% 654 499 31.1%
(IL, MN, OH) Dollars $250,416 $197,040 27.1% $202,400 $144,439 40.1% $163,933 $115,918 41.4%
  Avg. Price $263,873 $242,064 9.0% $254,912 $234,860 8.5% $250,663 $232,301 7.9%
Southeast                    
(includes unconsolidated joint ventures) Home 745 681 9.4% 635 566 12.2% 393 283 38.9%
(FL, GA, NC, SC) Dollars $227,373 $176,735 28.7% $180,979 $140,965 28.4% $125,734 $79,340 58.5%
  Avg. Price $305,198 $259,523 17.6% $285,007 $249,055 14.4% $319,934 $280,353 14.1%
Southwest                    
(includes unconsolidated joint ventures) Home 2,502 2,178 14.9% 2,331 2,003 16.4% 677 506 33.8%
(AZ, TX) Dollars $739,784 $590,208 25.3% $684,258 $515,757 32.7% $216,367 $160,840 34.5%
  Avg. Price $295,677 $270,986 9.1% $293,547 $257,492 14.0% $319,597 $317,866 0.5%
West                     
(includes unconsolidated joint ventures) Home 439 691 (36.5)% 542 622 (12.9)% 94 197 (52.3)%
(CA) Dollars $219,038 $266,288 (17.7)% $245,307 $225,663 8.7% $55,703 $81,973 (32.0)%
  Avg. Price $498,948 $385,366 29.5% $452,596 $362,802 24.8% $592,590 $416,107 42.4%
Grand Total                    
  Home 6,177 5,838 5.8% 5,930 5,356 10.7% 2,392 2,145 11.5%
  Dollars $2,196,653 $1,916,107 14.6% $2,090,501 $1,726,237 21.1% $848,375 $742,223 14.3%
  Avg. Price $355,618 $328,213 8.3% $352,530 $322,300 9.4% $354,672 $346,025 2.5%
Consolidated Total                    
  Home 5,544 5,137 7.9% 5,266 4,676 12.6% 2,167 1,889 14.7%
  Dollars $1,914,448 $1,597,698 19.8% $1,784,327 $1,405,580 26.9% $762,439 $632,318 20.6%
  Avg. Price $345,319 $311,018 11.0% $338,839 $300,595 12.7% $351,841 $334,737 5.1%
Unconsolidated Joint Ventures                    
  Home 633 701 (9.7)% 664 680 (2.4)% 225 256 (12.1)%
  Dollars $282,205 $318,409 (11.4)% $306,174 $320,657 (4.5)% $85,936 $109,905 (21.8)%
  Avg. Price $445,822 $454,221 (1.8)% $461,105 $471,554 (2.2)% $381,938 $429,316 (11.0)%
                     
DELIVERIES INCLUDE EXTRAS
Notes:                    
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.        
J. Larry Sorsby
Executive Vice President & CFO
732-747-7800

Jeffrey T. O'Keefe
Vice President, Investor Relations
732-747-7800