Tri Pointe Homes, Inc. Reports 2023 Second Quarter Results

-Net New Home Orders of 1,912 on a Monthly Absorption Rate of 4.5-

-New Home Deliveries of 1,173-

-Home Sales Revenue of $819 Million-

-Diluted Earnings Per Share of $0.60-

-Debt-to-Capital Ratio of 32.3% and Total Liquidity of $1.7 Billion-

INCLINE VILLAGE, Nev., July 27, 2023 (GLOBE NEWSWIRE) -- Tri Pointe Homes, Inc. (the "Company") (NYSE:TPH) today announced results for the second quarter ended June 30, 2023.

"Tri Pointe delivered strong results for the second quarter, surpassing our delivery guidance and leading to home sales revenue of $819 million while generating $61 million in net income available to common stockholders, or $0.60 per diluted share," said Doug Bauer, Tri Pointe Homes Chief Executive Officer. "The healthy buyer demand we saw in the first part of the year continued a strong seasonal trend through the second quarter, resulting in a 41% increase in net new home orders compared to the same prior-year period, and an 18% increase sequentially from the first quarter of 2023. We attribute these outstanding results to several underlying factors fueling today's housing market, the foremost of which is the persistent limited supply of overall housing that falls short of current demand. This demand is largely being powered by a combination of new household formations, the entry of Gen Z into the home-buying market, and Millennials reaching their prime home-buying age. Additionally, with stabilized mortgage rates, consumers have adjusted to mid-six to low-seven percent interest rates, setting a new normal in the market."

Mr. Bauer continued, "An important component to the supply/demand equation is the scarcity of resale home supply, with reports indicating that new listings are down nationwide by 27% due to the significant number of existing homebuyers who are not selling as a result of their locked-in rates which are well below current levels. This scarcity of resale homes has significantly boosted the homebuilding industry's market share, with newly constructed homes making up 33% of inventory compared to the typical 13% average, as reported by the National Association of Home Builders."

"Demand for the quarter was broad-based across our geographic footprint with an absorption rate of 4.5 homes per community per month. In addition, we raised net pricing at 73% of our selling communities during the quarter, while expanding our ending community count by 18%," said Tri Pointe Homes President and Chief Operating Officer Tom Mitchell. "As the homebuilding industry gains momentum, driven by favorable market dynamics and demographic factors, we remain committed to enhancing operational efficiencies, fostering our company culture, and continuously innovating our product offerings to cater to the evolving lifestyles of today's discerning consumers."

Mr. Bauer concluded, "As we enter the second half of 2023, we believe that our industry's share of the housing market will continue to increase and that the current supply/demand imbalance will continue into the foreseeable future. Through the rest of the year, we will continue to prioritize operational efficiency and cost management as supply chains continue to normalize. Furthermore, our balance sheet and liquidity reached record levels, allowing us flexibility in our efforts to balance growth and shareholder returns."

Results and Operational Data for Second Quarter 2023 and Comparisons to Second Quarter 2022

• Net income available to common stockholders was $60.7 million, or $0.60 per diluted share, compared to $136.4 million, or $1.33 per diluted share
• Home sales revenue of $819.1 million compared to $1.0 billion, a decrease of 18%
  • New home deliveries of 1,173 homes compared to 1,485 homes, a decrease of 21%
  • Average sales price of homes delivered of $698,000 compared to $677,000, an increase of 3%
• Homebuilding gross margin percentage of 20.4% compared to 27.2%, a decrease of 680 basis points. The current year period includes an $11.5 million impairment related to a single community in the Bay Area of California.
  • Excluding interest and impairments and lot option abandonments, adjusted homebuilding gross margin percentage was 24.9%*
• SG&A expense as a percentage of homes sales revenue of 11.9% compared to 9.5%, an increase of 240 basis points
• Net new home orders of 1,912 compared to 1,356, an increase of 41%
• Active selling communities averaged 140.3 compared to 121.8, an increase of 15%
  • Net new home orders per average selling community were 13.6 orders (4.5 monthly) compared to 11.1 orders (3.7 monthly)
  • Cancellation rate of 8% compared to 16%
• Backlog units at quarter end of 2,765 homes compared to 3,826, a decrease of 28%
  • Dollar value of backlog at quarter end of $1.9 billion compared to $3.0 billion, a decrease of 36%
  • Average sales price of homes in backlog at quarter end of $695,000 compared to $779,000, a decrease of 11%
• Ratios of debt-to-capital and net debt-to-net capital of 32.3% and 12.1%*, respectively, as of June 30, 2023
• Repurchased 1,137,478 shares of common stock at a weighted average price per share of $28.43 for an aggregate dollar amount of $32.3 million in the three months ended June 30, 2023
• Ended the second quarter of 2023 with total liquidity of $1.7 billion, including cash and cash equivalents of $981.6 million and $695.0 million of availability under our revolving credit facility
  
  

*	See "Reconciliation of Non-GAAP Financial Measures"

Outlook

For the third quarter, the Company anticipates delivering between 1,000 and 1,100 homes at an average sales price between $690,000 and $700,000. The Company expects homebuilding gross margin percentage to be in the range of 21.0% to 22.0% for the third quarter and anticipates its SG&A expense as a percentage of home sales revenue will be in the range of 12.0% to 13.0%. Finally, the Company expects its effective tax rate for the third quarter to be in the range of 26.0% to 27.0%.

For the full year, the Company anticipates delivering between 5,000 and 5,300 homes at an average sales price between $690,000 and $700,000. The Company expects homebuilding gross margin percentage to be in the range of 21.5% to 22.5% for the full year and anticipates its SG&A expense as a percentage of home sales revenue will be in the range of 10.5% to 11.5%. Finally, the Company expects its effective tax rate for the full year to be in the range of 26.0% to 27.0%.

Earnings Conference Call

The Company will host a conference call via live webcast for investors and other interested parties beginning at 10:00 a.m. Eastern Time on Thursday, July 27, 2023. The call will be hosted by Doug Bauer, Chief Executive Officer, Tom Mitchell, President and Chief Operating Officer, Glenn Keeler, Chief Financial Officer, and Linda Mamet, Chief Marketing Officer. Interested parties can listen to the call live and view the related slides on the Internet under the Events & Presentations heading in the Investors section of the Company's website at www.TriPointeHomes.com. Listeners should go to the website at least fifteen minutes prior to the call to download and install any necessary audio software. The call can also be accessed toll free at (877) 407-3982, or (201) 493-6780 for international participants. Participants should ask for the Tri Pointe Homes Second Quarter 2023 Earnings Conference Call. Those dialing in should do so at least ten minutes prior to the start of the call. A replay of the call will be available for two weeks following the call toll free at (844) 512-2921, or (412) 317-6671 for international participants, using the reference number 13739744. An archive of the webcast will also be available on the Company's website for a limited time.

About Tri Pointe Homes, Inc.

One of the largest homebuilders in the U.S., Tri Pointe Homes, Inc. (NYSE:TPH) is a publicly traded company and a recognized leader in customer experience, innovative design, and environmentally responsible business practices. The company builds premium homes and communities in 10 states, with deep ties to the communities it serves—some for as long as a century. Tri Pointe Homes combines the financial resources, technology platforms and proven leadership of a national organization with the regional insights, longstanding community connections and agility of empowered local teams. Tri Pointe has won multiple Builder of the Year awards, was named one of the 2023 Fortune 100 Best Companies to Work For®, and made Fortune magazine's 2017 100 Fastest-Growing Companies list. The company was also named as a Great Place to Work-Certified™ company for three years in a row 2021–2023, and was named on several Great Place to Work® Best Workplaces lists in 2022 and 2023. For more information, please visit TriPointeHomes.com.

Forward-Looking Statements

Various statements contained in this press release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements. These forward-looking statements may include, but are not limited to, statements regarding our strategy, projections and estimates concerning the timing and success of specific projects and our future production, land and lot sales, operational and financial results, including our estimates for growth, financial condition, sales prices, prospects, and capital spending. Forward-looking statements that are included in this press release are generally accompanied by words such as "anticipate," "believe," "could," "estimate," "expect," "future," "goal," "guidance," "intend," "likely," "may," "might," "outlook," "plan," "potential," "predict," "project," "should," "strategy," "target," "will," "would," or other words that convey future events or outcomes. The forward-looking statements in this press release speak only as of the date of this press release, and we disclaim any obligation to update these statements unless required by law, and we caution you not to rely on them unduly. These forward-looking statements are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. The following factors, among others, may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements: the effects of general economic conditions, including employment rates, housing starts, interest rate levels, home affordability, inflation, consumer sentiment, availability of financing for home mortgages and strength of the U.S. dollar; market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; the availability of desirable and reasonably priced land and our ability to control, purchase, hold and develop such parcels; access to adequate capital on acceptable terms; geographic concentration of our operations; levels of competition; the successful execution of our internal performance plans, including restructuring and cost reduction initiatives; the prices and availability of supply chain inputs, including raw materials, labor and home components; oil and other energy prices; the effects of U.S. trade policies, including the imposition of tariffs and duties on homebuilding products and retaliatory measures taken by other countries; the effects of weather, including the occurrence of drought conditions in parts of the western United States; the risk of loss from earthquakes, volcanoes, fires, floods, droughts, windstorms, hurricanes, pest infestations and other natural disasters, and the risk of delays, reduced consumer demand, and shortages and price increases in labor or materials associated with such natural disasters; the risk of loss from acts of war, terrorism, civil unrest or public health emergencies, including outbreaks of contagious disease, such as COVID-19; transportation costs; federal and state tax policies; the effects of land use, environment and other governmental laws and regulations; legal proceedings or disputes and the adequacy of reserves; risks relating to any unforeseen changes to or effects on liabilities, future capital expenditures, revenues, expenses, earnings, synergies, indebtedness, financial condition, losses and future prospects; changes in accounting principles; risks related to unauthorized access to our computer systems, theft of our homebuyers' confidential information or other forms of cyber-attack; and additional factors discussed under the sections captioned "Risk Factors" included in our annual and quarterly reports filed with the Securities and Exchange Commission. The foregoing list is not exhaustive. New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business.

Investor Relations Contact:

[email protected], 949-478-8696

Media Contact:

Carol Ruiz, [email protected], 310-437-0045

KEY OPERATIONS AND FINANCIAL DATA

(dollars in thousands)

(unaudited)

	Three Months Ended June 30,															Six Months Ended June 30,
		2023				2022			Change				% Change				2023				2022			Change				% Change
Operating Data:	(unaudited)
Home sales revenue	$	819,077			$	1,004,644			$	(185,567	)		(18	)%		$	1,587,482			$	1,729,895			$	(142,413	)		(8	)%
Homebuilding gross margin	$	167,078			$	273,292			$	(106,214	)		(39	)%		$	347,365			$	467,883			$	(120,518	)		(26	)%
Homebuilding gross margin %		20.4	%			27.2	%			(6.8	)%						21.9	%			27.0	%		(5.1		)%
Adjusted homebuilding gross margin %*		24.9	%			29.8	%			(4.9	)%						25.5	%			29.6	%		(4.1		)%
SG&A expense	$	97,465			$	95,352			$	2,113			2	%		$	185,693			$	176,047			$	9,646			5	%
SG&A expense as a % of home sales revenue		11.9	%			9.5	%			2.4	%						11.7	%			10.2	%			1.5	%
Net income available to common stockholders	$	60,724			$	136,383			$	(75,659	)		(55	)%		$	135,466			$	223,861			$	(88,395	)		(39	)%
Adjusted EBITDA*	$	129,928			$	220,905			$	(90,977	)		(41	)%		$	263,903			$	366,996			$	(103,093	)		(28	)%
Interest incurred	$	37,394			$	28,789			$	8,605			30	%		$	74,873			$	57,342			$	17,531			31	%
Interest in cost of home sales	$	25,366			$	24,963			$	403			2	%		$	45,592			$	42,028			$	3,564			8	%
Other Data:
Net new home orders		1,912				1,356				556			41	%			3,531				3,252				279			9	%
New homes delivered		1,173				1,485				(312	)		(21	)%			2,238				2,584				(346	)		(13	)%
Average sales price of homes delivered	$	698			$	677			$	21			3	%		$	709			$	669			$	40			6	%
Cancellation rate		8	%			16	%		(8		)%						9	%			11	%		(2		)%
Average selling communities		140.3				121.8				18.5			15	%			138.4				116.7				21.7			19	%
Selling communities at end of period		145				123				22			18	%
Backlog (estimated dollar value)	$	1,922,895			$	2,981,255			$	(1,058,360	)		(36	)%
Backlog (homes)		2,765				3,826				(1,061	)		(28	)%
Average sales price in backlog	$	695			$	779			$	(84	)		(11	)%
	June 30,				December 31,
		2023				2022			Change				% Change
Balance Sheet Data:	(unaudited)
Cash and cash equivalents	$	981,567			$	889,664			$	91,903			10	%
Real estate inventories	$	3,193,328			$	3,173,849			$	19,479			1	%
Lots owned or controlled		32,834				33,794				(960	)		(3	)%
Homes under construction (1)		3,131				2,373				758			32	%
Homes completed, unsold		168				288				(120	)		(42	)%
Debt	$	1,379,835			$	1,378,051			$	1,784			0	%
Stockholders' equity	$	2,896,111			$	2,832,389			$	63,722			2	%
Book capitalization	$	4,275,946			$	4,210,440			$	65,506			2	%
Ratio of debt-to-capital		32.3	%			32.7	%		(0.4		)%
Ratio of net debt-to-net capital*		12.1	%			14.7	%		(2.6		)%

__________

⁽¹⁾         Homes under construction included 66 and 78 models as of June 30, 2023 and December 31, 2022, respectively.

*          See "Reconciliation of Non-GAAP Financial Measures"

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	June 30,			December 31,
		2023			2022
Assets	(unaudited)
Cash and cash equivalents	$	981,567		$	889,664
Receivables		117,134			169,449
Real estate inventories		3,193,328			3,173,849
Investments in unconsolidated entities		139,959			129,837
Goodwill and other intangible assets, net		156,603			156,603
Deferred tax assets, net		34,850			34,851
Other assets		157,118			165,687
Total assets	$	4,780,559		$	4,719,940
Liabilities
Accounts payable	$	78,386		$	62,324
Accrued expenses and other liabilities		425,518			443,034
Loans payable		287,427			287,427
Senior notes		1,092,408			1,090,624
Total liabilities		1,883,739			1,883,409
Commitments and contingencies
Equity
Stockholders' equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively		—			—
Common stock, $0.01 par value, 500,000,000 shares authorized; 99,094,458 and 101,017,708 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively		991			1,010
Additional paid-in capital		—			3,685
Retained earnings		2,895,120			2,827,694
Total stockholders' equity		2,896,111			2,832,389
Noncontrolling interests		709			4,142
Total equity		2,896,820			2,836,531
Total liabilities and equity	$	4,780,559		$	4,719,940

CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands, except share and per share amounts)

(unaudited)

	Three Months Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
Homebuilding:
Home sales revenue	$	819,077			$	1,004,644			$	1,587,482			$	1,729,895
Land and lot sales revenue		7,086				114				8,792				1,711
Other operations revenue		796				703				1,470				1,347
Total revenues		826,959				1,005,461				1,597,744				1,732,953
Cost of home sales		651,999				731,352				1,240,117				1,262,012
Cost of land and lot sales		7,370				344				8,813				819
Other operations expense		782				704				1,447				1,350
Sales and marketing		43,241				38,523				85,103				70,762
General and administrative		54,224				56,829				100,590				105,285
Homebuilding income from operations		69,343				177,709				161,674				292,725
Equity in income of unconsolidated entities		42				143				269				88
Other income, net		11,093				116				18,697				389
Homebuilding income before income taxes		80,478				177,968				180,640				293,202
Financial Services:
Revenues		10,370				12,228				19,246				20,980
Expenses		7,405				6,322				13,236				11,630
Equity in income of unconsolidated entities		—				—				—				46
Financial services income before income taxes		2,965				5,906				6,010				9,396
Income before income taxes		83,443				183,874				186,650				302,598
Provision for income taxes		(21,472	)			(45,936	)			(48,822	)			(76,161	)
Net income		61,971				137,938				137,828				226,437
Net income attributable to noncontrolling interests		(1,247	)			(1,555	)			(2,362	)			(2,576	)
Net income available to common stockholders	$	60,724			$	136,383			$	135,466			$	223,861
Earnings per share
Basic	$	0.61			$	1.33			$	1.35			$	2.14
Diluted	$	0.60			$	1.33			$	1.34			$	2.12
Weighted average shares outstanding
Basic		99,598,933				102,164,377				100,305,168				104,731,388
Diluted		100,634,964				102,787,919				101,184,993				105,478,446

MARKET DATA BY REPORTING SEGMENT & GEOGRAPHY

(dollars in thousands)

(unaudited)

	Three Months Ended June 30,										Six Months Ended June 30,
	2023					2022					2023					2022
	New Homes Delivered		Average Sales Price			New Homes Delivered		Average Sales Price			New Homes Delivered		Average Sales Price			New Homes Delivered		Average Sales Price
Arizona	195		$	765		127		$	732		330		$	773		197		$	733
California	352			798		579			698		691			813		1,093			690
Nevada	88			743		157			724		186			753		241			711
Washington	40			733		54			1,092		58			802		126			1,023
West total	675			778		917			731		1,265			793		1,657			723
Colorado	49			732		76			682		93			758		119			662
Texas	278			560		318			511		488			588		538			507
Central total	327			586		394			544		581			615		657			535
Carolinas(1)	142			483		44			462		317			458		72			458
Washington D.C. Area(2)	29			1,176		130			770		75			1,082		198			744
East total	171			600		174			692		392			577		270			668
Total	1,173		$	698		1,485		$	677		2,238		$	709		2,584		$	669
	Three Months Ended June 30,										Six Months Ended June 30,
	2023					2022					2023					2022
	Net New Home Orders		Average Selling Communities			Net New Home Orders		Average Selling Communities			Net New Home Orders		Average Selling Communities			Net New Home Orders		Average Selling Communities
Arizona	189			13.7		195			14.2		306			13.4		410			13.6
California	787			49.2		601			49.2		1,488			51.6		1,302			44.7
Nevada	105			8.0		116			7.3		189			7.6		261			8.0
Washington	70			5.8		21			1.8		122			5.4		69			2.4
West total	1,151			76.7		933			72.5		2,105			78.0		2,042			68.7
Colorado	38			6.8		34			8.0		79			6.4		165			8.0
Texas	494			39.0		153			22.0		808			36.1		568			22.1
Central total	532			45.8		187			30.0		887			42.5		733			30.1
Carolinas(1)	188			14.3		170			11.5		439			14.5		296			10.0
Washington D.C. Area(2)	41			3.5		66			7.8		100			3.4		181			7.9
East total	229			17.8		236			19.3		539			17.9		477			17.9
Total	1,912			140.3		1,356			121.8		3,531			138.4		3,252			116.7

⁽¹⁾         Carolinas comprises North Carolina and South Carolina.

⁽²⁾         Washington D.C. Area comprises Maryland, Virginia and the District of Columbia.

MARKET DATA BY REPORTING SEGMENT & GEOGRAPHY, continued

(dollars in thousands)

(unaudited)

	As of June 30, 2023								As of June 30, 2022
	Backlog Units		Backlog Dollar Value			Average Sales Price			Backlog Units		Backlog Dollar Value			Average Sales Price
Arizona	354		$	276,167		$	780		733		$	586,871		$	801
California	1,095			797,480			728		1,245			1,128,517			906
Nevada	128			94,278			737		346			279,679			808
Washington	99			91,266			922		72			60,188			836
West total	1,676			1,259,191			751		2,396			2,055,255			858
Colorado	36			24,889			691		230			178,845			778
Texas	602			340,938			566		666			408,415			613
Central total	638			365,827			573		896			587,260			655
Carolinas(1)	342			156,759			458		345			162,317			470
Washington D.C. Area(2)	109			141,118			1,295		189			176,423			933
East total	451			297,877			660		534			338,740			634
Total	2,765		$	1,922,895		$	695		3,826		$	2,981,255		$	779
	June 30,		December 31,
	2023			2022
Lots Owned or Controlled:
Arizona	2,520			2,901
California	11,123			11,399
Nevada	1,914			1,634
Washington	827			827
West total	16,384			16,761
Colorado	1,749			1,600
Texas	9,951			10,361
Central total	11,700			11,961
Carolinas(1)	3,525			3,857
Washington D.C. Area(2)	1,225			1,215
East total	4,750			5,072
Total	32,834			33,794
	June 30,		December 31,
	2023			2022
Lots by Ownership Type:
Lots owned	18,378			18,762
Lots controlled (3)	14,456			15,032
Total	32,834			33,794

⁽¹⁾         Carolinas comprises North Carolina and South Carolina.

⁽²⁾         Washington D.C. Area comprises Maryland, Virginia and the District of Columbia.

⁽³⁾         As of June 30, 2023 and December 31, 2022, lots controlled included lots that were under land option contracts or purchase contracts. As of June 30, 2023 and December 31, 2022, lots controlled for Central include 3,685 and 3,325 lots, respectively, and lots controlled for East include 93 and 141 lots, respectively, which represent our expected share of lots owned by our investments in unconsolidated land development joint ventures.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(unaudited)

In this press release, we utilize certain financial measures that are non-GAAP financial measures as defined by the Securities and Exchange Commission. We present these measures because we believe they and similar measures are useful to management and investors in evaluating the Company's operating performance and financing structure. We also believe these measures facilitate the comparison of our operating performance and financing structure with other companies in our industry. Because these measures are not calculated in accordance with Generally Accepted Accounting Principles ("GAAP"), they may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

The following tables reconcile the homebuilding gross margin percentage, as reported and prepared in accordance with GAAP, to the non-GAAP measure adjusted homebuilding gross margin percentage. We believe this information is meaningful as it isolates the impact that leverage has on homebuilding gross margin and permits investors to make better comparisons with our competitors, who adjust gross margins in a similar fashion.

	Three Months Ended June 30,
		2023			%				2022			%
	(dollars in thousands)
Home sales revenue	$	819,077			100.0	%		$	1,004,644			100.0	%
Cost of home sales		651,999			79.6	%			731,352			72.8	%
Homebuilding gross margin		167,078			20.4	%			273,292			27.2	%
Add:  interest in cost of home sales		25,366			3.1	%			24,963			2.5	%
Add:  impairments and lot option abandonments		11,761			1.4	%			972			0.1	%
Adjusted homebuilding gross margin	$	204,205			24.9	%		$	299,227			29.8	%
Homebuilding gross margin percentage		20.4	%						27.2	%
Adjusted homebuilding gross margin percentage		24.9	%						29.8	%

	Six Months Ended June 30,
		2023			%				2022			%
	(dollars in thousands)
Home sales revenue	$	1,587,482			100.0	%		$	1,729,895			100.0	%
Cost of home sales		1,240,117			78.1	%			1,262,012			73.0	%
Homebuilding gross margin		347,365			21.9	%			467,883			27.0	%
Add:  interest in cost of home sales		45,592			2.9	%			42,028			2.4	%
Add:  impairments and lot option abandonments		12,478			0.8	%			1,461			0.1	%
Adjusted homebuilding gross margin	$	405,435			25.5	%		$	511,372			29.6	%
Homebuilding gross margin percentage		21.9	%						27.0	%
Adjusted homebuilding gross margin percentage		25.5	%						29.6	%

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued)

(unaudited)

The following table reconciles the Company's ratio of debt-to-capital to the non-GAAP ratio of net debt-to-net capital. We believe that the ratio of net debt-to-net capital is a relevant financial measure for management and investors to understand the leverage employed in our operations and as an indicator of the Company's ability to obtain financing.

	June 30, 2023				December 31, 2022
Loans payable	$	287,427			$	287,427
Senior notes		1,092,408				1,090,624
Total debt		1,379,835				1,378,051
Stockholders' equity		2,896,111				2,832,389
Total capital	$	4,275,946			$	4,210,440
Ratio of debt-to-capital(1)		32.3	%			32.7	%
Total debt	$	1,379,835			$	1,378,051
Less: Cash and cash equivalents		(981,567	)			(889,664	)
Net debt		398,268				488,387
Stockholders' equity		2,896,111				2,832,389
Net capital	$	3,294,379			$	3,320,776
Ratio of net debt-to-net capital(2)		12.1	%			14.7	%

__________

⁽¹⁾      The ratio of debt-to-capital is computed as the quotient obtained by dividing total debt by the sum of total debt plus stockholders' equity.

⁽²⁾      The ratio of net debt-to-net capital is computed as the quotient obtained by dividing net debt (which is total debt less cash and cash equivalents) by the sum of net debt plus stockholders' equity.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued)

(unaudited)

The following table calculates the non-GAAP financial measures of EBITDA and Adjusted EBITDA and reconciles those amounts to net income available to common stockholders, as reported and prepared in accordance with GAAP. EBITDA means net income available to common stockholders before (a) interest expense, (b) expensing of previously capitalized interest included in costs of home sales, (c) income taxes and (d) depreciation and amortization. Adjusted EBITDA means EBITDA before (e) amortization of stock-based compensation and (f) impairments and lot option abandonments. Other companies may calculate EBITDA and Adjusted EBITDA (or similarly titled measures) differently. We believe EBITDA and Adjusted EBITDA are useful measures of the Company's ability to service debt and obtain financing.

	Three Months Ended June 30,								Six Months Ended June 30,
		2023				2022				2023				2022
	(in thousands)
Net income available to common stockholders	$	60,724			$	136,383			$	135,466			$	223,861
Interest expense:
Interest incurred		37,394				28,789				74,873				57,342
Interest capitalized		(37,394	)			(28,789	)			(74,873	)			(57,342	)
Amortization of interest in cost of sales		25,681				24,963				45,932				42,028
Provision for income taxes		21,472				45,936				48,822				76,161
Depreciation and amortization		6,128				6,741				13,182				12,026
EBITDA		114,005				214,023				243,402				354,076
Amortization of stock-based compensation		4,162				5,751				8,023				11,023
Impairments and lot option abandonments		11,761				1,131				12,478				1,897
Adjusted EBITDA	$	129,928			$	220,905			$	263,903			$	366,996