SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM 10-K
 |
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended June 30, 2004
OR
 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File Number 1-6830
ORLEANS HOMEBUILDERS, INC.
(formerly FPA Corporation)
(Exact name of registrant as specified in its charter)
| Delaware | 59-0874323 | One
Greenwood Square, #101 3333 Street Road Bensalem, PA 19020 |
||
| (State
or other jurisdiction of incorporation or organization) |
(I.R.S.
Employer Identification No.) |
(Address of Principal Executive Office) |
(215) 245-7500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Name
of Each Exchange on which Registered |
|
| Common
Stock, $.10 Par Value Per Share (also formerly registered under Section 12(g) of the Act) |
American Stock Exchange |
Securities Registered Pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
| YES |
NO |
Indicate by
check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation
S-K is not contained herein, and will not be contained, to the best of registrant’s
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K.
Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2).
| YES |
NO |
The aggregate market value of the registrant’s Common Stock held by nonaffiliates of the registrant as of December 31, 2003 was $60,274,568.
Documents incorporated by reference:
TABLE OF CONTENTS
| Item 1. | Business. |
General
The Company has been in operation for 85 years and is a leading homebuilder in the Pennsylvania and New Jersey markets. In October 2000, pursuant to a strategic initiative to target growth in new geographic markets, the Company entered the North Carolina and Virginia markets through the acquisition of Parker & Lancaster Corporation (“PLC”), a privately-held residential homebuilder. In July 2003, the Company entered the Orlando, Florida market through its acquisition of Masterpiece Homes, Inc. (“Masterpiece Homes”), an established homebuilder located in Orange City, Florida. Masterpiece Homes reported revenues for the calendar year ended 2002 and the six months ended June 30, 2003 of approximately $26,300,000 and $20,000,000, respectively. Except as specifically indicated, information in this report includes the operations of Masterpiece Homes beginning July 29, 2003. In addition, in July 2004, the Company entered the Chicago, Illinois market through its acquisition of Realen Homes, L.P. (“Realen Homes”), an established homebuilder with its corporate headquarters in Southeastern Pennsylvania. Realen Homes reported revenues for the calendar year ended 2003 and the six months ended June 30, 2004 of approximately $145,000,000 and $39,000,000, respectively. Except as specifically indicated, information in this report does not include the operations of Realen Homes. See Note 2 of Notes to Consolidated Financial Statements for further details regarding the acquisitions of PLC and Masterpiece Homes and Note 14 of Notes to Consolidated Financial Statements for further details regarding the acquisition of Realen Homes.
1
The Company makes available free of charge through the Company’s website (www.orleanshomes.com) its annual reports on Form 10-K, quarterly reports on Form 10-Q and Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after the Company electronically files such material with, or furnishers it to, the Securities and Exchange Commission.
Homebuilding
Northern Region. The Company’s northern region is comprised of its Southeastern Pennsylvania, Central New Jersey and Southern New Jersey markets. The Company conducts business in the northern region under the Orleans Homebuilders brand name. In the northern region, the Company currently builds homes predominantly targeted toward move-up, luxury, empty nester and active adult homebuyers with an average regional home sales price of $453,000 in backlog as of June 30, 2004. For fiscal 2004, in the northern region the Company delivered 669 homes, generating $275 million or 50.8% of its residential revenue. For fiscal 2003, in the northern region the Company delivered 766 homes, generating $247 million, or 64.6% of its residential revenue.
2
The following tables set forth certain information with respect to our residential communities and residential revenues by type of home.
Residential Communities as of June 30, 2004
| Number | Number of | Average sales | ||||||||||||||
| of | Backlog in | homes | price in | |||||||||||||
| Region | communities | Home price range | thousands | in backlog | backlog | |||||||||||
| Northern | 19 | $ | 222,000 | — | $ | 768,000 | $ | 209,712 | 463 | $ | 453,000 | |||||
| Southern | 52 | 122,000 | — | 550,000 | 128,267 | 337 | 381,000 | |||||||||
| Florida | 10 | 93,000 | — | 256,000 | 52,848 | 319 | 166,000 | |||||||||
| Total | 81 | $ | 390,827 | 1,119 | ||||||||||||
Residential Revenue by Type of Home for the Fiscal Year Ended June 30, 2004
| Percentage of | |||||
| Residential | residential | ||||
| Type of Home | revenue | revenue | |||
| Single-family | $ | 448,818,000 | 83 | % | |
| Townhouses | 81,112,000 | 15 | % | ||
| Condominiums | 10,815,000 | 2 | % | ||
| Total | $ | 540,745,000 | 100 | % | |
3
The following table sets forth certain details as to residential sales activity. The information provided is for the twelve months ended June 30, 2004, 2003 and 2002 in the case of revenues earned and new orders, and as of June 30, 2004, 2003 and 2002 in the case of backlog.
| Year Ended June 30, | |||||||||
| (in thousands, except homes data) | |||||||||
| Northern Region | |||||||||
| New Jersey and Pennsylvania | 2004 | 2003 | 2002 | ||||||
| Residential revenue | $ | 274,606 | $ | 247,035 | $ | 223,987 | |||
| Homes | 669 | 766 | 808 | ||||||
| Average Price | $ | 410 | $ | 323 | $ | 277 | |||
| New Orders | $ | 294,384 | $ | 286,345 | $ | 229,971 | |||
| Homes | 670 | 761 | 798 | ||||||
| Average Price | $ | 439 | $ | 376 | $ | 288 | |||
| Backlog | $ | 209,712 | $ | 189,934 | $ | 150,624 | |||
| Homes | 463 | 462 | 467 | ||||||
| Average Price | $ | 453 | $ | 411 | $ | 323 | |||
| Southern Region | |||||||||
| North Carolina, South Carolina and Virginia | |||||||||
| Residential revenue | $ | 204,798 | $ | 135,535 | $ | 127,073 | |||
| Homes | 651 | 477 | 514 | ||||||
| Average Price | $ | 315 | $ | 284 | $ | 247 | |||
| New Orders | $ | 237,232 | $ | 175,928 | $ | 126,308 | |||
| Homes | 698 | 587 | 481 | ||||||
| Average Price | $ | 340 | $ | 300 | $ | 263 | |||
| Backlog | $ | 128,267 | $ | 95,833 | $ | 55,440 | |||
| Homes | 337 | 290 | 180 | ||||||
| Average Price | $ | 381 | $ | 330 | $ | 308 | |||
| Florida Region (1) | |||||||||
| Residential revenue | $ | 61,341 | — | — | |||||
| Homes | 433 | — | — | ||||||
| Average Price | $ | 142 | — | — | |||||
| New Orders | 72,527 | — | — | ||||||
| Homes | 454 | — | — | ||||||
| Average Price | $ | 160 | — | — | |||||
| Backlog | $ | 52,848 | — | — | |||||
| Homes | 319 | — | — | ||||||
| Average Price | $ | 166 | — | — | |||||
| Combined Regions | |||||||||
| Residential revenue | $ | 540,745 | $ | 382,570 | $ |
351,060 | |||
| Homes | 1,753 | 1,243 | 1,322 | ||||||
| Average Price | $ | 308 | $ | 308 | $ |
266 | |||
| New Orders | $ | 604,143 | $ | 462,273 | $ |
356,279 | |||
| Homes | 1,822 | 1,348 | 1,279 | ||||||
| Average Price | $ | 332 | $ |
343 | $ |
279 | |||
| Backlog | $ | 390,827 | $ |
285,767 | $ |
206,064 | |||
| Homes | 1,119 | 752 | 647 | ||||||
| Average Price | $ | 349 | $ |
380 | $ |
318 | |||
| (1) | For fiscal 2004, information on residential revenue and new orders is for the period beginning July 28, 2003, the date the Company entered this market through its acquisition of Masterpieces Homes. |
Construction
The Company historically has designed its own homes with the assistance of unaffiliated architectural firms as well as supervised the development and building of its communities. When the Company constructs homes, it acts as a general contractor and employs subcontractors at specified prices for the installation of site improvements and construction of its residential homes. The Company’s agreements with subcontractors provide for a fixed price for work performed or materials supplied.
4
A large majority of the Company’s single-family detached homes are constructed after contracts are signed and mortgage approval has been obtained. The Company generally begins construction of condominium and townhouse buildings after it has obtained customer commitments for at least 50% of the homes in that building. Depending on the market conditions and the specific community, the Company may also build speculative homes. Most of these homes are sold while under construction. The Company monitors its speculative inventory to achieve an adequate return on investment. The Company does not manufacture any of the materials or other items used in the development of its communities, nor does it maintain substantial inventories of materials. The Company has not experienced significant delays in obtaining materials needed to date and has long-standing relationships with many of its major suppliers and contractors. None of the Company’s suppliers accounted for more than 10% of its total purchases in fiscal 2004.
Purchasing and Budgeting
The Company has established relationships with a number of vendors and suppliers in each of its markets. The Company believes these relationships reduce its exposure to any market shortages in labor or materials. The Company has negotiated price arrangements that it believes are favorable to it with both national and regional suppliers to purchase items such as lumber, appliances, plumbing fixtures, floor coverings and other high-quality equipment and materials. The Company has established budgets for all of its home designs and offered options. These budgets are modified and adjusted by local division management to reflect the specifications needed to meet market demands and local cost variances.
Sales and Marketing
The Company markets its homes to various homebuyer segments according to the specific needs of each market. The Company advertises extensively using newspapers, industry publications, direct mail, radio, billboards and its own brochures. The Company has developed and maintains its websites, www.orleanshomes.com , www.parkerorleans.com and www.masterpiecehomesflorida.com , to provide prospective homebuyers with information regarding its communities, available home designs and price ranges, as well as a multimedia gallery offering panoramic video tours and streaming video presentations of some of its homes.
The Company typically utilizes furnished models merchandised by professional decorators, which are located in its communities to help sell its homes. The Company prefers to staff these models with its own sales professionals to assist prospective homebuyers with home selection and financing decisions. Sales professionals are compensated on a commissioned basis and are trained extensively in selling techniques, construction and home financing programs. When market conditions warrant, the Company utilizes designated real estate sales brokers who are typically paid on a commission basis. A significant portion of the Company’s sales are generated in cooperation with outside brokers. Accordingly, the Company sponsors a variety of programs and events to increase awareness and incentivize the brokerage community to promote and sell its homes. The Company also offers a preferred buyer program, which provides its homebuyers in certain of its markets with a discount to be used toward the future purchase of one of its homes.
5
In addition to a wide range of home designs, the Company provides its buyers with the ability to personalize their homes through an extensive home customization program. In most markets, the Company facilitates this process with the use of design centers, which provide a centralized and professionally merchandised presentation of the various options and features available in its homes. Some of the Company’s most popular options include kitchen and flooring upgrades and bonus rooms. Homebuyers have the opportunity to work individually with a design consultant to assist them in making their option and upgrade selections. The design consultants are paid a combination of salary and commission. The Company believes the use of design centers increases homebuyer satisfaction, streamlines the option selection process and ultimately leads to greater profitability.
Sales of the Company’s homes are made pursuant to a standard home sale contract, which is modified to comply with jurisdictional requirements. Typically, each contract requires a deposit from the homebuyer, which may vary from three to ten percent of the purchase price, according to product type and market practice. In addition, the home sale contract typically contains a financing contingency. The financing contingency provides homebuyers with the right to cancel in the event they are unable to obtain financing at a prevailing interest rate within a specified time period from the execution of the home sale contract. The contract may also contain other contingencies, such as the sale of the homebuyer’s existing home. The Company closely monitors all such contingencies.
Land Policy
The Company acquires land in order to provide an adequate and well-located supply for its residential building operations. The Company’s strategy for land acquisition and development is dictated by specific market conditions where it conducts its operations. In general, the Company seeks to minimize the overall risk associated with acquiring undeveloped land by structuring purchase agreements that allow it to control the process of obtaining environmental and other regulatory approvals, but defer the acquisition of the land until the approval process has been substantially completed. In its southern and Florida regions, the Company generally acquires improved lots from land developers on a lot takedown basis. Under a typical agreement with a land developer, a minimal number of lots are purchased initially, and the remaining lot takedowns are subject to the terms of an option agreement. In evaluating possible opportunities to acquire land, the Company considers a variety of factors including feasibility of development, proximity to developed areas, population growth patterns, customer preferences, estimated cost of development and availability and cost of financing.
The Company engages in many phases of development activity, including land and site planning, obtaining environmental and other regulatory approvals, and the construction of roads, sewer, water and drainage facilities, recreation facilities and other amenities.
6
As of June 30, 2004, the Company owned building lots that would yield 3,721 homes. As of June 30, 2004, the Company also had under option land and improved lots for an aggregate purchase price of approximately $445 million that would yield 8,570 homes for a total owned or controlled lot position of 12,291. Generally, the Company structures its land acquisitions so that it has the right to cancel the agreements to purchase undeveloped land and improved lots by forfeiture of its deposit under the agreement. Furthermore, the agreements are generally contingent upon obtaining all governmental approvals and satisfaction of certain requirements by the Company and the sellers. As of June 30, 2004, the Company had incurred costs associated with the acquisition and development of these parcels aggregating approximately $30 million, including approximately $18 million of paid deposits. Contingent upon the Company obtaining all required regulatory approvals, it anticipates completing a majority of these acquisitions during the next several years. For fiscal 2004, the Company forfeited approximately $481,000 in land deposits and pre-acquisition costs related to the cancellation of contracts to purchase both improved lots and undeveloped land.
The following table sets forth the Company’s land positions as of June 30, 2004.
| Lots under | ||||||
| option | Total lots | |||||
| Lots | agreement | owned or | ||||
| Region | owned | (controlled) | controlled | |||
| Northern | 1,906 | 5,149 | 7,055 | |||
| Southern | 1,373 | 2,225 | 3,598 | |||
| Florida | 442 | 1,196 | 1,638 | |||
|
|
|
|
||||
| Total | 3,721 | 8,570 | 12,291 | |||
|
|
|
|
Including the acquisition of Realen Homes in July of 2004, the Company increased the number of lots owned and the number of lots under option agreement by 1,636 lots to 5,357 lots and 746 lots to 9,316 lots, respectively. The total number of lots owned or controlled including the acquisition of Realen homes is 14,673.
Customer Service and Quality Control
The Company believes its customer service begins when the home sale contract is executed. The Company’s homebuyers are provided with a detailed New Homebuyer Manual, which outlines the entire home construction and delivery process. Homebuyers are provided with up to four orientation sessions conducted at the home. These orientation sessions provide the homebuyer with the opportunity to become familiar with the construction and operation of the home as well as provide the Company with valuable feedback. Immediately prior to delivery of the home, the final orientation is conducted, from which a list of items to address is generated.
After delivery of the home, the Company processes all requests for warranty service through its customer service department. In the event service is required, the Company believes that a timely response is critical. The Company typically schedules its contractors to minimize the inconvenience to the homebuyer and attempts to complete the necessary repairs within 14 days of receipt of a request for warranty service. The Company utilizes a two-step customer survey process to obtain valuable feedback from its customers and to help monitor the level of customer satisfaction at the time of and after delivery of the home.
7
Warranty Program and Construction Defect Claims
The Company provides all of its homebuyers with a one to two year limited warranty on workmanship and materials and a ten-year limited warranty covering structural items. The extent of the warranties may vary depending on the state in which the Company operates. The Company’s contracts with its subcontractors and suppliers generally require them to indemnify the Company for any claims for defective materials or workmanship arising for up to one year from the date of completion of the item, thereby reducing the Company’s warranty exposure. Because of increasing insurance costs and an analysis of its claims history, the Company now self-insures the first $2 million of each construction defect or product liability claim. Until February 2004, these claims were fully insured, subject to applicable policy limits and exclusions.
Cost Sharing Arrangements and Joint Ventures
From time to time, the Company has developed and owned communities through joint ventures with other parties. More recently, in the northern region, the Company has partnered with other homebuilders and developers to acquire land and/or to develop or improve common off-site facilities, such as sewer treatment plants. Most of these agreements are established as cost sharing arrangements whereby the homebuilders and developers share in the cost of acquiring the parcel or developing or improving the off-site facility. Determinations by the Company to enter into these agreements have been based upon a number of factors, including the opportunity to limit its financial exposure involved in the acquisition of larger parcels of land and the ability to pool resources with other homebuilders and developers with respect to completion of the regulatory approval process for a particular parcel. Once the approval process is complete and the land has been acquired, each company will typically take ownership of a segment of the parcel and begin its own land development and construction process. In some communities in the southern region, as an alternative to land acquisition financing, the Company has partnered with developers to construct and sell homes on the developers’ lots. At the time of settlement, the developers receive a fixed amount for the cost of the lot and a portion of the profits from the sale of the home. The Company will continue to evaluate all opportunities related to cost sharing agreements and joint ventures; however, at the present time, this does not constitute a material portion of the Company’s operations.
8
Financial Services
As a part of the Company’s objective to make the home buying process more convenient and to increase the efficiency of its building cycle, the Company offers mortgage brokerage services to its customers. Through the Company’s mortgage brokerage subsidiary, it assists its homebuyers in obtaining financing from unaffiliated lenders. The Company does not fund or service the mortgage loans, nor does it assume any credit or interest rate risk in connection with originating the mortgages. The Company’s mortgage operation derives most of its revenue from buyers of its homes, although it also offers its services to existing homeowners refinancing their mortgages, as well as to customers purchasing new homes from one of the Company’s competitors.
During fiscal 2004, approximately 36% of the Company’s homebuyers utilized the services of its mortgage business. For fiscal 2004, the Company derived less than 1% of its total earned revenues from this business.
Employees
As of June 30, 2004, the Company employed 212 executive, administrative and clerical personnel, 182 sales personnel and 235 construction supervisory personnel and laborers, for a total of 629 employees.
The level of construction and sales employees varies throughout the year in relation to the level of activities at the Company’s various developments. The Company considers its relations with its employees to be good.
Government Regulations
The Company and its subcontractors are subject to continuing compliance requirements of various federal, state and local statutes, ordinances, rules and regulations regarding zoning, plumbing, heating, air conditioning and electrical systems, building permits and similar matters. The intensity of development in recent years in areas in which the Company is actively developing real estate has resulted in increasingly restrictive regulation and moratoriums by governments due to density, sewer and water, ecological and similar factors. Further expansion and development may require prior approval of federal, state and local authorities and may result in delay or curtailment of development activities and costly compliance programs.
In January 1983, the New Jersey Supreme Court rendered a decision known as the “Mount Laurel II” decision, which has the effect of requiring certain municipalities in New Jersey to provide housing for persons of low and moderate income. In order to comply with such requirements, municipalities in New Jersey may require developers, including the Company, in connection with the development of residential communities, to contribute funds or otherwise assist in the achievement of the municipalities’ fair share of low or moderate-income housing. To satisfy these requirements, these municipalities generally approve additional lots within the residential communities the Company is developing and require the Company to build low and moderate income housing on those lots. The Company’s gross profit on homes built on the lots approved for low and moderate income housing is usually substantially less than the gross profit it recognize s on other homes in those communities. The Company had no residential revenue for low and moderate income housing units in fiscal 2004. The Company had residential revenue for low and moderate income housing units totaling approximately $617,000 and $1.8 million in fiscal 2003 and its fiscal year ended June 30, 2002 (“fiscal 2002”), respectively. In addition, the Company contributed $398,000, $200,000 and $815,000 to municipalities in fiscal 2004, fiscal 2003, and fiscal 2002, respectively, in order to satisfy low and moderate income housing requirements for municipalities in which the Company builds. Further, as of June 30, 2004, the Company had commitments with six municipalities for affordable housing contributions totaling approximately $2.5 million, payable in installments through June 2008.
9
In recent years, regulation by federal and state authorities relating to the sale and advertising of condominium interests and residential real estate has become more restrictive and extensive. In order to advertise and sell condominiums and residential real estate in many jurisdictions, including Pennsylvania and New Jersey, the Company has been required to prepare a registration statement or other disclosure document and, in some cases, to file such materials with a designated regulatory agency.
Despite the Company’s past ability to obtain necessary permits and authorizations for the communities the Company builds, more stringent requirements may be imposed on developers and homebuilders in the future. Although the Company cannot determine the effect of such requirements, they could result in time-consuming and expensive compliance programs and substantial expenditures for environmental controls, which could have a material adverse effect on the Company’s results of operations. In addition, the continued effectiveness of permits already granted is subject to many factors beyond the Company’s control, including changes in policies, rules and regulations and their interpretation and application.
Environmental Regulation and Litigation
Development and sale of real property creates a potential for environmental liability on the part of the developer, owner, or any mortgage lender for its own acts or omissions as well as those of prior owners of the subject property or adjacent parcels. While the Company does not currently have any material environmental liabilities of which it is aware, in the future, if hazardous substances are discovered on or emanating from any of its properties, the Company, as well as any prior owners or operators, may be held liable for costs and liabilities relating to these hazardous substances. Environmental studies are generally undertaken in connection with property acquisitions by the Company and it endeavors to obtain Phase I environmental site assessments on all properties acquired. Further governmental regulation on environmental matters affecting residential development could impose substantial additional expense to the Company, which could adversely affect the results of operations or the value of properties owned, or under contract of purchase by the Company.
Competition
The homebuilding industry is highly competitive. The Company competes on the basis of its reputation, location, design, price, financing programs, quality of product and related amenities. The Company competes with regional and national homebuilders, some of which have greater sales, financial resources and geographical diversity than the Company. Numerous local homebuilders and individual resales of homes and homesites provide additional competition.
10
Economic Conditions
The Company’s business is affected by general economic conditions in the United States and its related regions and particularly by the level of interest rates. The Company cannot determine whether interest rates will continue to be at levels attractive to prospective home buyers or whether mortgage and construction financing will continue to be available.
Seasonality
The sale and construction of homes may be adversely affected by harsh winter weather conditions in some of the regions in which the Company operates. Residential revenue is typically lowest in our third fiscal quarter and highest in our fourth fiscal quarter.
| Item 2. | Properties. |
The Company leases office space for its corporate headquarters at 3333 Street Road, Bensalem, Pennsylvania 19020, consisting of approximately 18,500 square feet. The Company also leases additional office space consisting of approximately 6,300 square feet in Bensalem, Pennsylvania, 8,000 square feet in Mount Laurel, New Jersey, a total of 17,000 square feet in two Virginia locations, a total of 12,000 square feet in three North Carolina locations and a total of 13,000 square feet in four locations in the Florida region for certain centralized support services related to operations in those regions.
In connection with the acquisition of Realen Homes in July of 2004, the Company obtained additional leased office space of approximately 9,300 square feet in Yardley, Pennsylvania and 10,000 square feet in Inverness, Illinois.
| Item 3. | Legal Proceedings. |
General
The Company is not currently subject to any material legal proceedings. From time to time, however, the Company is named as a defendant in legal actions arising from its normal business activities. Although the Company cannot accurately predict the amount of liability, if any, that could arise with respect to legal actions currently pending against it, in its opinion, any such liability will not have a material adverse effect on the financial position, operating results or cash flows.
11
| Item 4. | Submission of Matters to a Vote of Security Holders. |
No matters were submitted to a vote of security holders during the fourth quarter of the fiscal year covered by this report.
| Item 5. | Market for Registrant’s Common Stock and Related Stockholder Matters. |
The principal market on which the Company’s Common Stock is traded is the American Stock Exchange, Inc. (Symbol: OHB).
The intra-day high and low sales prices for the Company’s common stock as reported by the American Stock Exchange for the periods indicated below are as follows:
| Fiscal year ended June 30, | High | Low | |||||||
| 2004 | First Quarter | $ | 12.09 | $ | 9.60 | ||||
| Second Quarter | 35.00 | 11.95 | |||||||
| Third Quarter | 29.08 | 19.50 | |||||||
| Fourth Quarter | 24.10 | 14.77 | |||||||
| 2003 | First Quarter | $ | 8.65 | $ | 6.00 | ||||
| Second Quarter | 8.43 | 6.31 | |||||||
| Third Quarter | 8.85 | 6.90 | |||||||
| Fourth Quarter | 12.24 | 6.82 | |||||||
The number of common stockholders of record of the Company as of August 16, 2004 was approximately 200. The Company has not paid a cash dividend since December 1982 and it is the current policy of the Company’s Board of Directors to retain earnings to finance the growth and development of the Company’s business. Therefore, there are no current plans to pay any cash dividends. Any change in this policy will depend on the Company’s future earnings, capital requirements and market conditions. While the Company may consider paying a cash dividend on its common stock in the future, there is no assurance that the Company will do so. In addition, under one or more of the Company’s lending facilities, the Company may not distribute as dividends any more than 5% of each year’s net income.
| Item 6. | Selected Financial Data. |
The following table sets forth our selected historical consolidated financial data as of and for each of the last five fiscal years ended June 30, 2004. The financial data has been derived from our Audited Consolidated Financial Statements and related notes. This data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7 of this annual report.
12
| Fiscal year ended June 30, | |||||||||||||||
| 2004 (1) | 2003 | 2002 | 2001 (2) | 2000 | |||||||||||
| (in thousands, except homes and per share data) | |||||||||||||||
| Statement of earnings data: | |||||||||||||||
| Total earned revenues: | |||||||||||||||
| Residential properties | $ | 540,745 | $ | 382,570 | $ | 351,060 | $ | 282,384 | $ | 176,189 | |||||
| Land sales | 787 | 744 | 80 | 1,786 | 405 | ||||||||||
| Other income | 5,726 | 5,171 | 3,516 | 3,052 | 2,403 | ||||||||||
| Total earned revenues | 547,258 | 388,485 | 354,656 | 287,222 | 178,997 | ||||||||||
| Cost and expenses: | |||||||||||||||
| Residential properties | (416,967 | ) | (294,066 | ) | (283,593 | ) | (236,129 | ) | (147,287 | ) | |||||
| Land sales | (907 | ) | (875 | ) | (102</ | ||||||||||