Entry-level sales propel Meritage profits
Meritage Homes, the Scottsdale, Ariz.-based home builder, reported third quarter 2019 home closing revenue of $939.2 million – a 7% increase from home closing revenue of $877.7 million in the third quarter last year.
Total orders for the third quarter of 2019 increased 24% year-over-year, driven by a 27% year-over-year increase in absorptions, primarily due to higher demand for Meritage’s entry-level priced Live.Now product, the company said. Additionally, a 7% increase in home closing revenue for the quarter reflected a 12% increase in home closing volume.
Net earnings was $69.8 million for the third quarter of 2019, a 29% increase compared to $54.1 million for the third quarter of 2018.
Meritage is one the largest publicly traded home builders in the United States. The company’s homes are designed with a focus on first-time and first move-up buyers in Arizona, California, Colorado, Texas, Florida, Georgia, North Carolina, South Carolina and Tennessee.
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The bottom line: Entry-level home sales help increase profits by 29% in the third quarter.
What the CEO said: “Our results for the third quarter demonstrated continued strong demand for our homes, as well as the impact of operating efficiencies that are enabling us to improve our margins while selling homes at affordable prices," said Steven Hilton, chairman and CEO of Meritage Homes. “Our total orders for new homes increased 24% year-over-year in the third quarter, as a result of higher absorptions on slightly lower community count.”
“We’re clearly in the sweet spot of the market with our Live.Now homes for value-conscious buyers,” he added. “Those homes are selling at a significantly higher pace than move-up homes and made up 54% of our third quarter orders, compared to 43% a year ago.”
Company info: The full third quarter 2019 report from Meritage Homes can be read here.
Total orders for the third quarter of 2019 increased 24% year-over-year, driven by a 27% year-over-year increase in absorptions, primarily due to higher demand for Meritage’s entry-level priced Live.Now product, the company said. Additionally, a 7% increase in home closing revenue for the quarter reflected a 12% increase in home closing volume.Net earnings was $69.8 million for the third quarter of 2019, a 29% increase compared to $54.1 million for the third quarter of 2018.
Meritage is one the largest publicly traded home builders in the United States. The company’s homes are designed with a focus on first-time and first move-up buyers in Arizona, California, Colorado, Texas, Florida, Georgia, North Carolina, South Carolina and Tennessee.
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The bottom line: Entry-level home sales help increase profits by 29% in the third quarter.
What the CEO said: “Our results for the third quarter demonstrated continued strong demand for our homes, as well as the impact of operating efficiencies that are enabling us to improve our margins while selling homes at affordable prices," said Steven Hilton, chairman and CEO of Meritage Homes. “Our total orders for new homes increased 24% year-over-year in the third quarter, as a result of higher absorptions on slightly lower community count.”
“We’re clearly in the sweet spot of the market with our Live.Now homes for value-conscious buyers,” he added. “Those homes are selling at a significantly higher pace than move-up homes and made up 54% of our third quarter orders, compared to 43% a year ago.”
Company info: The full third quarter 2019 report from Meritage Homes can be read here.