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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

(Mark One)

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

     For the Quarterly Period Ended March 31, 2003

 

¨   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

     For the transition period from                      to                     

 

Commission File Number 0-23270

 

Dominion Homes, Inc.

(Exact name of registrant as specified in its charter)

 

Ohio

  

31-1393233

(State or other jurisdiction of

incorporation or organization)

  

(I.R.S. Employer

Identification No.)

5501 Frantz Road, Dublin, Ohio

(Address of principal executive offices)

 

43017-0766

(Zip Code)

 

(614) 761-6000

(Registrant’s Telephone Number, Including Area Code)

 

Not Applicable

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

 

1. 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 12 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  x  No  ¨

 

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act)   Yes  x  No  ¨

 

Number of common shares outstanding as of May 12, 2003: 8,061,750

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

Dominion Homes, Inc.

Consolidated Balance Sheets

(In thousands, except share information)

 

    

March 31,

2003

     

December 31, 2002

  
    

(unaudited)

         

Assets

                  

Cash and cash equivalents

   

$

4,511

 

   

$

4,121

 

Accounts receivable

                  

Trade

   

 

87

 

   

 

413

 

Due from financial institutions for residential closings

   

 

2,691

 

   

 

2,584

 

Real estate inventories:

                  

Land and land development costs

   

 

151,386

 

   

 

157,165

 

Homes under construction

   

 

113,186

 

   

 

102,450

 

Other

   

 

2,837

 

   

 

3,240

 

    
  

Total real estate inventories

   

 

267,409

 

   

 

262,855

 

    
  

Prepaid expenses and other

   

 

4,147

 

   

 

3,404

 

Deferred income taxes

   

 

6,479

 

   

 

6,901

 

Property and equipment, at cost

   

 

18,040

 

   

 

16,617

 

Less accumulated depreciation

   

 

(9,702

)

   

 

(9,158

)

    
  

Net property and equipment

   

 

8,338

 

   

 

7,459

 

    
  

Total assets

   

$

293,662

 

   

$

287,737

 

    
  

Liabilities and Shareholders’ Equity

                  

Accounts payable

   

$

10,897

 

   

$

7,231

 

Deposits on homes under contract

   

 

2,314

 

   

 

2,314

 

Accrued liabilities

   

 

29,165

 

   

 

29,726

 

Note payable, banks

   

 

110,455

 

   

 

111,070

 

Term debt

   

 

4,557

 

   

 

4,415

 

    
  

Total liabilities

   

 

157,388

 

   

 

154,756

 

    
  

Commitments and contingencies

                  

Shareholders’ equity

                  

Common shares, without stated value, 12,000,000 shares authorized,

8,279,211 shares issued and 8,059,700 shares outstanding on

March 31, 2003 and 8,273,211 shares issued and 8,202,691

shares outstanding on December 31, 2002

   

 

61,840

 

   

 

61,799

 

Deferred compensation

   

 

(1,678

)

   

 

(1,784

)

Retained earnings

   

 

81,284

 

   

 

76,446

 

Accumulated other comprehensive loss

   

 

(2,318

)

   

 

(2,460

)

Treasury stock, at cost (219,511 shares at March 31, 2003 and

70,520 shares at December 31, 2002)

   

 

(2,854

)

   

 

(1,020

)

    
  

Total shareholders’ equity

   

 

136,274

 

   

 

132,981

 

    
  

Total liabilities and shareholders’ and equity

   

$

293,662

 

   

$

287,737

 

    
  

 

The accompanying notes are an integral part of the consolidated financial statements.

 

-2-

 

Dominion Homes, Inc.

Consolidated Statements of Operations

(In thousands, except share and per share amounts)

(Unaudited)

 

    

Three Months Ended March 31,

    

2003

   

2002

Revenues

   

$

103,985

   

$

98,378

Cost of real estate sold

   

 

79,046

   

 

75,442

    
  

Gross profit

   

 

24,939

   

 

22,936

Selling, general and administrative

   

 

15,380

   

 

13,842

    
  

Income from operations

   

 

9,559

   

 

9,094

Interest expense

   

 

1,628

   

 

2,099

    
  

Income before income taxes

   

 

7,931

   

 

6,995

Provision for income taxes

   

 

3,093

   

 

2,924

    
  

Net income

   

$

4,838

   

$

4,071

    
  

Earnings per share

              

Basic

   

$

0.61

   

$

0.63

    
  

Diluted

   

$

0.59

   

$

0.62

    
  

Weighted average shares outstanding

              

Basic

   

 

8,036,522

   

 

6,465,777

    
  

Diluted

   

 

8,134,770

   

 

6,578,701

    
  

 

The accompanying notes are an integral part of the consolidated financial statements.

 

-3-

 

Dominion Homes, Inc.

Consolidated Statement of Changes in Shareholders’ Equity

(In thousands)

(Unaudited)

 

    

Deferred Compensation

     

Accumulated

Other

                
    

Common Shares

   

Liability

     

Trust Shares

     

Retained Earnings

     

Comprehensive

Loss

     

Treasury

Stock

     

Total

  

Balance, December 31, 2002

   

$

61,799

   

$

(639

)

   

$

(1,145

)

   

$

76,446

     

$

(2,460

)

   

$

(1,020

)

   

$

132,981

 

Net income

                            

 

4,838

                       

 

4,838

 

Unrealized hedging gain, net of deferred taxes of $98

                                     

 

142

 

            

 

142

 

                                                        

Comprehensive income

                                                       

 

4,980

 

                                                        

Shares awarded and redeemed

   

 

41

                                                

 

41

 

Shares distributed from trust for deferred compensation

          

 

(114

)

   

 

114

 

                              

 

—  

 

Shares repurchased

                                              

 

(1,834

)

   

 

(1,834

)

Deferred compensation

          

 

157

 

   

 

(51

)

                              

 

106

 

    
  
  
  
    
  
  

Balance, March 31, 2003

   

$

61,840

   

$

(596

)

   

$

(1,082

)

   

$

81,284

     

$

(2,318

)

   

$

(2,854

)

   

$

136,274

 

    
  
  
  
    
  
  

 

The accompanying notes are an integral part of the consolidated financial statements.

 

-4-

 

Dominion Homes, Inc.

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

 

    

Three Months Ended

March 31

  
    

2003

     

2002

  

Cash flows from operating activities:

                  

Net income

   

$

4,838

 

   

$

4,071

 

Adjustments to reconcile net income to cash provided by (used in) operating activities:

                  

Depreciation and amortization

   

 

823

 

   

 

498

 

Issuance of common shares for compensation

   

 

27

 

   

 

33

 

Reserve for real estate inventories

   

 

120

 

   

 

473

 

Deferred income taxes

   

 

324

 

   

 

(769

)

Changes in assets and liabilities:

                  

Accounts receivable

   

 

219

 

   

 

(251

)

Real estate inventories

   

 

(4,607

)

   

 

(15,331

)

Prepaid expenses and other

   

 

(744

)

   

 

(304

)

Accounts payable

   

 

3,666