<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20594
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1996
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 001-12822
BEAZER HOMES USA, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 58-2086934
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
5775 Peachtree Dunwoody Road, Suite C-550, Atlanta, Georgia 30342
(Address of principal executive offices) (Zip Code)
(404) 250-3420
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Sections 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 the
filing requirements for the past 90 days.
YES [X] NO [ ]
Class Outstanding at August 9, 1996
----- -----------------------------
Common Stock, $0.01 par value 6,594,350 shares
Preferred Stock, $0.01 par value 2,000,000 shares
Page 1 of 16 Pages
Exhibit Index Appears on Page 14
<PAGE>
BEAZER HOMES USA, INC.
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed Consolidated Balance Sheets,
June 30, 1996 (unaudited) and September 30, 1995 3
Unaudited Condensed Consolidated Statements of Operations,
Three and Nine Months Ended June 30, 1996 and 1995 4
Unaudited Condensed Consolidated Statements of Cash Flows,
Nine Months Ended June 30, 1996 and 1995 5
Notes to Condensed Consolidated Financial Statements 6
Item 2 Management's Discussion and Analysis
of Financial Condition and Results of Operations 9
PART II OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K 14
SIGNATURES 15
</TABLE>
2
<PAGE>
PART I. FINANCIAL INFORMATION
BEAZER HOMES USA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except per share data)
<TABLE>
<CAPTION>
JUNE 30, SEPTEMBER 30,
1996 1995
---- ----
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 952 $ 40,407
Accounts receivable 4,396 2,842
Inventory 359,355 285,268
Property, plant and equipment, net 2,585 1,323
Goodwill, net 6,339 6,745
Other assets 9,877 8,655
-------- --------
Total assets $383,504 $345,240
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Trade accounts payable $ 28,091 $ 40,111
Other payables and accrued liabilities 35,201 25,585
Revolving credit facility 32,000 ---
Senior notes 115,000 115,000
-------- --------
Total liabilities 210,292 180,696
Stockholders' equity:
Preferred stock (par value $.01 per share,
5,000,000 shares authorized, 2,000,000
issued and outstanding; $50,000
aggregate liquidation preference) 20 20
Common stock (par value $.01 per share,
30,000,000 shares authorized, 9,343,619
issued, 6,594,350 and 6,547,850 outstanding) 93 93
Paid in capital 188,089 187,698
Retained earnings 31,726 23,347
Unearned restricted stock (2,009) (1,907)
-------- --------
217,919 209,251
Less treasury stock, at cost
(2,749,267 shares) (44,707) (44,707)
-------- --------
Total stockholders' equity 173,212 164,544
-------- --------
Total $383,504 $345,240
======== ========
</TABLE>
See Notes to Condensed Consolidated Financial Statements
3
<PAGE>
BEAZER HOMES USA, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(dollars in thousands, except per share data)
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED JUNE 30, ENDED JUNE 30,
------------------------------------------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Total revenue $217,065 $151,377 $571,800 $377,224
Costs and expenses:
Home construction and land sales 183,776 130,908 483,610 322,267
Interest 3,860 3,386 10,637 8,035
Selling, general and administrative 21,450 14,759 58,658 38,765
-------- -------- -------- --------
Operating income 7,979 2,324 18,895 8,157
Other income 50 37 71 234
-------- -------- -------- --------
Income before income taxes 8,029 2,361 18,966 8,391
Provision for income taxes 3,212 944 7,587 3,356
-------- -------- -------- --------
Net income $ 4,817 $ 1,417 $ 11,379 $ 5,035
======== ======== ======== ========
Preferred dividends $ 1,000 --- $ 3,000 ---
Net income applicable to
common stockholders $ 3,817 $ 1,417 $ 8,379 $ 5,035
Weighted average number of
shares (in thousands):
Primary 6,481 9,088 6,487 9,202
Fully-diluted 9,105 --- 9,111 ---
Net income per share:
Primary $0.59 $0.16 $1.29 $0.55
Fully-diluted $0.53 --- $1.25 ---
</TABLE>
See Notes to Condensed Consolidated Financial Statements
4
<PAGE>
BEAZER HOMES USA, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
<TABLE>
<CAPTION>
NINE MONTHS ENDED JUNE 30,
--------------------------
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 11,379 $ 5,035
Adjustments to reconcile net income to
net cash used by operating activities:
Depreciation and amortization 1,080 766
Changes in operating assets and liabilities,
net of effects of acquisitions (59,988) (61,872)
------- -------
Net cash used by operating activities (47,529) (56,071)
------- -------
Cash flows from investing activities:
Capital expenditures (1,345) (403)
Purchase of Trendmaker Homes - Dallas (16,887) ---
Purchase of Gulfcoast Homes (2,694) ---
Purchase of Bramalea Homes Texas, net of
cash acquired --- (3,212)
Purchase of Treasure Coast Division --- (200)
------- -------
Net cash used by investing activities (20,926) (3,815)
------- -------
Cash flows from financing activities:
Proceeds from revolving credit facility, net 32,000 45,000
Repurchase of shares from US Industries --- (16,000)
Purchase of option from US Industries --- (500)
Dividends paid on preferred stock (3,000) ---
------- -------
Net cash provided by financing activities 29,000 28,500
------- -------
Decrease in cash and cash equivalents (39,455) (31,386)
Cash and cash equivalents at beginning of period 40,407 35,980
------- -------
Cash and cash equivalents at end of period $ 952 $ 4,594
======= =======
</TABLE>
See Notes to Condensed Consolidated Financial Statements
5
<PAGE>
BEAZER HOMES USA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(1) BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial
statements of Beazer Homes USA, Inc. ("Beazer" or the "Company") have been
prepared in accordance with generally accepted accounting principles for
interim financial information and in accordance with the instructions to
Form 10-Q and Article 10 of Regulation S-X, and consequently such financial
statements do not include all of the information and disclosures required by
generally accepted accounting principles for complete financial statements.
Accordingly, for further information, the reader of this Form 10-Q should
refer to the audited consolidated financial statements of the Company for
the year ended September 30, 1995 incorporated by reference in the Company's
Annual Report on Form 10-K.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included in the accompanying condensed financial statements.
(2) INVENTORY
A summary of inventory is as follows (dollars in thousands):
<TABLE>
<CAPTION>
JUNE 30, SEPTEMBER 30,
1996 1995
---- ----
(UNAUDITED)
<S> <C> <C>
Finished homes $ 71,567 $ 52,464
Development projects in progress 240,386 196,500
Unimproved land held for future
development 26,581 21,315
Model homes 20,821 14,989
-------- --------
$359,355 $285,268
======== ========
</TABLE>
Development projects in progress consist principally of land, land
improvement costs and, if applicable, construction costs for houses which are in
various stages of development but not ready for sale. Certain of the finished
homes in inventory are reserved by a deposit or sales contract.
6
<PAGE>
BEAZER HOMES USA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(3) INTEREST
The following table sets forth certain information regarding
interest (dollars in thousands):
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
During the period:
Interest incurred $3,980 $4,136 $10,729 $10,639
====== ====== ======= =======
Previously capitalized interest
amortized to costs and expenses $3,860 $3,386 $10,637 $ 8,035
====== ====== ======= =======
At the end of the period:
Capitalized interest in ending
inventory $6,603 $7,646 $ 6,603 $ 7,646
====== ====== ======= =======
</TABLE>
(4) EARNINGS PER SHARE
The computation of primary earnings per common share is based upon
the weighted average number of common shares outstanding during the period plus
(in periods in which they have a dilutive effect) the effect of common stock
equivalents, primarily from stock options. Common share equivalents are
computed using the treasury stock method.
Fully diluted earnings per share, which further assumes the
conversion of 2.0 million shares of Series A Cumulative Convertible
Exchangeable Preferred Stock ($50.0 million aggregate liquidation preference)
issued in August 1995 into 2.6 million shares of common stock at the conversion
price of $19.05, is presented in the accompanying condensed consolidated
statements of operations for the three and nine months ended June 30, 1996.
(5) SHAREHOLDER RIGHTS PLAN
In June 1996 the Company's Board of Directors adopted a
Shareholder Rights Plan and distributed a dividend of one preferred share
purchase right (a "Right") to purchase one one-hundredth of a share of Series
B Junior Participating Preferred Stock, par value $0.01 per share (the
"Preferred Shares"), of the Company. The Rights become exercisable in certain
limited circumstances involving principally the acquisition of over 20% of
the Company's outstanding common stock by any one individual or group. The
Rights are initially exercisable at a price of $80.00 per one hundredth of a
Preferred Share subject to adjustment. Following certain other events after
the Rights have become exercisable, each Right entitles its holder to
purchase at the Right's then-current exercise price, a number of shares of
the Company's common stock having a market value of twice such price, or, in
certain circumstances, securities of the acquirer, having a then-current
market value of two times the exercise price of the right.
The Rights are redeemable and may be amended at the Company's
option before they become exercisable. Until a Right is exercised, the holder
of a Right, as such, has no rights as a shareholder of the Company. The
Rights expire on June 24, 2006.
7
<PAGE>
BEAZER HOMES USA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(6) REPURCHASE OF SHARES FROM US INDUSTRIES
In June 1995, Hanson Properties North America, Inc. transferred
its investment (2,749,267 shares) in the Company's common stock to USI
Properties, Inc. ("USI"), a subsidiary of US Industries, Inc. On June 9,
1995, the Company and USI entered into a stock purchase agreement pursuant to
which the Company purchased from USI 1,000,000 shares of the Company's common
stock for $16.0 million, or $16 per share. Also on June 9, 1995, the Company
entered into an option agreement with USI (the "Option") to acquire, the
remaining 1,749,267 shares of the Company's common stock held by USI. Cash
consideration of $5,00,000 was paid for the Option. On August 8, 1995,
pursuant to its exercise of the Option, the Company repurchased the remaining
1,749,267 shares held by USI for $28.2 million or $16 1/8 per share. The
repurchased shares are reflected in the accompanying consolidated financial
statements as treasury stock. Such purchases were funded primarily from the
issuance of the Company's Series A Cumulative Convertible Exchangeable
Preferred Stock.
(7) RECENT ACCOUNTING PRONOUNCEMENTS
In March 1995, the Financial Accounting Standards Board issued
Statement No. 121, "Accounting for the Impairment for Long-Lived Assets to Be
Disposed Of" ("SFAS 121"). SFAS 121 requires that long-lived assets and certain
identifiable intangibles be reviewed for impairment whenever events or changes
in circumstances based on future expected cash flows indicate that the carrying
amount may not be recoverable. SFAS 121 is required for financial statements
for fiscal years beginning after December 15, 1995. Upon adoption, the Company
does not believe that SFAS 121 will have a material impact on its consolidated
financial statements.
In October 1995, the Financial Accounting Standards Board issued
Statement No. 123, "Accounting for Stock-Based Compensation, ("SFAS 123"). SFAS
123 establishes financial accounting and reporting standards for stock-based
employee compensation plans, such as stock purchase plans and stock option
plans. The Company is not required to adopt the principal provisions of SFAS 123
until its fiscal year ending September 30, 1997. The Company has not yet
decided how it will implement this standard.
8
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The following table presents certain operating and financial data for the
Company (dollars in thousands):
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
JUNE 30, JUNE 30,
---------------------------- ----------------------------
1996 1995 1996 1995
-------------- ---- ---------------- ----
% %
AMOUNT CHANGE AMOUNT AMOUNT CHANGE AMOUNT
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
NUMBER OF NEW ORDERS,
NET OF CANCELLATIONS: (a)
Southeast Region 550 (19.9)% 687 1,603 9.4% 1,465
Southwest Region 837 (10.5) 935 2,526 34.1 1,884
Central Region 119 n/m 34 267 n/m 33
--------- ----- -------- --------- ---- --------
Total 1,506 (9.1) 1,656 4,396 30.0 3,382
========= ======== ========= ========
NUMBER OF CLOSINGS:
Southeast Region 554 36.8 % 405 1,503 32.2% 1,137
Southwest Region 868 52.3 570 2,299 65.5 1,389
Central Region 74 n/m 15 178 n/m 17
--------- ----- -------- --------- ---- --------
Total 1,496 51.1 990 3,980 56.5 2,543
========= ======== ========= ========
TOTAL REVENUE:
Southeast Region $ 83,162 38.9 % $ 59,876 $ 220,651 36.5% $161,692
Southwest Region 122,379 37.4 89,080 323,101 51.9 212,766
Central Region 11,524 n/m 2,421 28,048 n/m 2,766
--------- ----- -------- --------- ---- --------
Total $ 217,065 43.4 $151,377 $ 571,800 51.6 $377,224
========= ======== ========= ========
AVERAGE SALES PRICE PER HOME CLOSED:
Southeast Region $ 150.1 1.6 %$ 147.8 $ 146.8 3.2% $ 142.2
Southwest Region 141.0 (9.8) 156.3 140.5 (8.3) 153.2
Central Region 155.7 n/m 161.4 157.4 n/m 161.4
Total 145.1 (5.1) 152.9 143.7 (3.1) 148.3
BACKLOG UNITS AT END OF PERIOD:
Southeast Region 844 4.7 % 806
Southwest Region 1,078 7.7 1,001
Central Region 234 n/m 38
---------- ----- ------
Total 2,156 16.9 1,845
========== ======
AGGREGATE SALES VALUE OF
HOMES IN BACKLOG AT END
OF PERIOD: $ 332,254 21.2 % $274,189
========= ========
NUMBER OF ACTIVE SUBDIVISIONS:
Southeast Region 104 14.3 % 91
Southwest Region 61 15.1 53
Central Region 28 n/m 9
--------- ---------
Total 193 26.1 153
========= =========
</TABLE>
n/m Percentage change not meaningful
(a) New contracts for the nine months ended June 30, 1996 does not include
129 homes in backlog acquired on December 27, 1995 from Del Mar
Development, Inc. New contracts for the three and nine months ended
June 30, 1996 do not include 127 homes in backlog acquired on May 23,
1996 and June 26, 1996 with Gulf Coast Homes and Trendmaker Homes -
Dallas, respectively.
9
<PAGE>
OVERVIEW:
Beazer Homes designs, builds and sells single family homes in the Southeast,
Southwest and Central regions of the United States. The Company's Southeast
Region includes Georgia, North Carolina, South Carolina, Tennessee and Florida,
its Southwest Region includes Arizona, California and Nevada and its Central
Region includes Texas. The Company intends, subject to market conditions, to
expand in its current markets and to consider entering new markets through
expansion from existing markets ("satellite expansion") or through acquisitions
of established regional homebuilders. On May 23, 1996 the Company entered the
Fort Myers and Naples markets of western Florida with the acquisition of
Gulfcoast Homes ("Gulfcoast") for approximately $3 million. On June 26, 1996
the Company expanded its presence in the Dallas, Texas market with the
acquisition of Trendmaker Homes - Dallas ("Trendmaker"), for approximately $22
million. Recent satellite expansions include Reno (NV), Knoxville (TN) and
Myrtle Beach (SC).
The Company's homes are designed to appeal primarily to entry-level and first
time move-up home buyers, and are generally offered for sale in advance of their
construction. The majority of homes are sold pursuant to standard sales
contracts entered into prior to commencement of construction. Once a contract
has been signed, the Company classifies the transaction as a "new order." Such
sales contracts are usually subject to certain contingencies such as the buyer's
ability to qualify for financing. Homes covered by such sales contracts are
considered by the Company as its "backlog." The Company does not recognize
revenue on homes in backlog until the sales are closed and the risk of ownership
has been transferred to the buyer.
NEW ORDERS AND BACKLOG: The Company believes the strong positive comparisons in
new orders for the nine months ended June 30, 1996 compared to the same period
in 1995 is the result of favorable economic conditions, primarily reduced
interest rates, for the first six months of the fiscal year, and the Company's
timely opening of new subdivisions. With the exception of the Nashville and
Charlotte markets, all of the Company's markets experienced positive order
comparisons for the nine month period, including growth in excess of 45% in
Arizona and Nevada, 33% in South Carolina, and 21% in Florida. Excluding the 19
subdivisions acquired during the quarter ended June 30, 1996 with Trendmaker and
Gulfcoast, the number of active subdivisions increased by 25 from 149 at
September 30, 1995 to 174 at June 30, 1996. Of that increase, three
subdivisions were added during the quarter ended June 30, 1996. Recent satellite
expansions into Knoxville, Reno, and Myrtle Beach have not contributed
significantly to the reported results to date.
New orders for the quarter ended June 30, 1996 compared to June 30, 1995
decreased by 9.1%. This decrease on a total company basis reflects, in
management's opinion, the impact of an increase in mortgage interest rates since
January 1996. While most of the Company's individual markets reflect the total
Company trend, California, Florida (excluding 4 new orders for Gulfcoast), South
Carolina and Texas experienced increases in new orders for the comparable
quarterly periods. The largest decrease in new orders in comparison to the
quarter ended June 30, 1995 was in the Phoenix market where new orders were down
122 homes (25.8%). The Company has experienced significant order growth in the
Phoenix during the past nine months, and is focusing on building out the homes
in backlog.
10
<PAGE>
The increase for the Company's Texas operations (Central Region) result from the
Company's entry into the Dallas and Houston markets via the acquisition of
Bramalea Homes Texas in April 1995. New order figures for the Central Region do
not include order activity related to the acquisition of Trendmaker completed
June 26, 1996.
The increase in backlog units at June 30, 1996 compared to June 30, 1995 is
attributable to the strong order growth experienced throughout the year, as well
as 127 units in backlog acquired during the quarter via acquisition. The
aggregate sales value of homes in backlog increased significantly for the
comparable period primarily due to the acquired backlog, which has a higher
average price than the Company's other markets. The average price of homes in
backlog excluding the impact of the acquisitions is $151.9. This average
represents a slight increase over June 30, 1995 because of the number of homes
in backlog in Houston and Treasure Coast, where average sales prices are above
the average for the Company total.
RESULTS OF OPERATIONS:
The following table shows certain items in the Company's statements of income
expressed as a percentage of total revenue.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
June 30, June 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Total revenue 100.0% 100.0% 100.0% 100.0%
Costs of home construction and
land sales 84.7 86.5 84.6 85.4
Interest 1.8 2.2 1.9 2.1
Selling, general and administrative 9.9 9.7 10.3 10.3
Operating income 3.7 1.5 3.3 2.2
</TABLE>
REVENUES: The Company experienced significant revenue growth in all regions for
both the three and nine months ended June 30, 1996 compared to the same periods
in 1995. The level of revenue growth is the result of a 51.1% and 56.5%
increase in the number of homes closed, and 5.1% and 3.1% decrease in the
average price per home closed for the three and nine month periods,
respectively. The Southeast Region's average price per home closed increased
for the three and nine month period ended June 30, 1996 in comparison to the
same periods in 1995. This increase can be attributed principally to product
mix. The average price per home closed has decreased for each comparable
period in the Southwest and Central Regions which is attributable to continued
efforts to expand the Company's presence in the first-time buyer market,
especially in Arizona. The increase in new homes closed is a result of the
increased new orders for the nine months ended as described previously.
11
<PAGE>
COST OF HOME CONSTRUCTION AND LAND SALES: Cost of home construction and land
sales as a percentage of revenues decreased slightly for the three and nine
months ended June 30, 1996 compared to the same periods in 1995. This decrease
is largely attributable to decreases in construction costs (material and labor),
and an increase in deliveries from homes started subsequent to sale for the
comparable periods. Additionally, the Company's Arizona and Texas markets,
which typically experience higher gross margins than the Company average,
represent a greater percentage of total closings for both the three and nine
month periods.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE: Selling, general and
administrative expenses increased slightly as a percentage of total revenues for
the three months ended June 30, 1996 compared to the prior year period, and
remained unchanged as a percentage of revenues for the comparative nine month
periods ending June 30, 1996 and 1995. As interest rates increased during the
Company's third fiscal quarter and many of the markets became increasingly
competitive, sales and marketing expense, and commission expense increased.
Company wide reductions in general and administrative expenses as a percentage
of revenues for both the three and nine month periods ended June 30, 1996
completely offset the increases in selling expenses for the nine months, and
partially offset the increases for the comparative quarters.
INTEREST EXPENSE: Interest expense as a percentage of revenues for the three
and nine months ended June 30, 1996 is less than the comparable periods in 1995.
Interest incurred for the comparable quarters is lower in 1996 than 1995, and
slightly higher for the nine month period. Interest expense is down for both
periods, however, because of accelerated inventory turnover and lower interest
rates. Annualized inventory turnover (Cost of sales including interest/average
inventory) is 2.0 for the nine months ended June 30, 1996 versus 1.5 for the
comparable period in 1995. Turnover was 2.2 for the quarter versus 1.7 for the
previous quarterly period.
INCOME TAXES: The Company's effective income tax rate was approximately 40% for
each of the three and nine month periods ended June 30, 1996 and 1995.
FINANCIAL CONDITION AND LIQUIDITY:
At June 30, 1996, the Company had $32 million of borrowings outstanding under
its $80 million unsecured revolving line of credit (the "Credit Agreement"), and
had available additional borrowings of $48 million. Available borrowings under
the Credit Agreement are limited to certain percentages of homes under contract,
unsold homes, substantially improved lots and accounts receivable as defined in
the Credit Agreement. The Credit Agreement is used primarily to fund seasonal
working capital needs, however, during the quarter ended June 30, 1996 the
Company used borrowings under the Credit Agreement to fund the purchase of
Trendmaker Homes-Dallas for approximately $16.9 million, and Gulfcoast Homes
for approximately $2.7 million. The Company's debt to total capitalization ratio
at June 30, 1996 was 45.9%.
The Company has utilized, and will continue to utilize, land options as a method
of controlling and subsequently acquiring land. At June 30, 1996, the Company
had 7,730 lots under option. At June 30, 1996, the Company had commitments with
respect to option contracts with specific performance obligations of
approximately $46.5 million. The Company expects to exercise all of its option
contracts with specific performance obligations and, subject to market
conditions, substantially all of its options contracts without specific
performance obligations.
In August 1995, the Company sold 2,000,000 shares of its Series A Cumulative
Convertible Exchangeable Preferred Stock. The Preferred Stock pays dividends
quarterly at an annual rate of 8% (aggregating $4 million annually).
In June 1996, the Company's Board of Directors authorized the expenditure of
Company funds to repurchase an aggregate of up to 10% of the Company's
currently outstanding common stock (the "Stock Repurchase Plan"). As of June
30, 1996, the Company has not repurchased any shares of the Company's common
stock under the Stock Repurchase Plan.
12
<PAGE>
All subsidiaries of Beazer Homes USA, Inc. are guarantors of the Senior Notes
and are jointly and severally liable for the Company's obligations under the
Senior Notes. Separate financial statements and other disclosures concerning
each of the subsidiaries are not included, as the aggregate assets, liabilities,
earnings and equity of the subsidiaries equal such amounts for the Company on a
consolidated basis and separate subsidiary financial statements are not
considered material to investors. Neither the Credit Agreement nor the Senior
Notes restrict distributions to Beazer Homes USA, Inc. by its subsidiaries.
Management believes that the Company's current borrowing capacity, cash on hand
at June 30, 1996, and anticipated cash flows from the operations is sufficient
to meet liquidity needs for the foreseeable future. There can be no assurance,
however, that amounts available in the future from the Company's sources of
liquidity will be sufficient to meet the Company's future capital needs. The
amount and types of indebtedness that the Company may incur may be limited by
the terms of the Indenture governing the Senior Notes and the Credit Agreement.
The Company continually evaluates expansion opportunities through acquisition of
established regional homebuilders and such opportunities may require the Company
to seek additional capital in the form of equity or debt financing from a
variety of potential sources, including additional bank financing and/or
Securities offerings.
13
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
11 Statement Regarding Computation of Per Share
Earnings
27 Financial Data Schedule
(b) A Current Report on Form 8-K was filed on June 21, 1996
relating to the Preferred Share Purchase Rights (the "Rights")
distributed by the Company immediately following approval of
the Rights for listing on the New York Stock Exchange to its
shareholders of record on June 24, 1996 pursuant to dividend
announced on June 21, 1996.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Beazer Homes USA, Inc.
Date: August 13, 1996 By: /s/ David S. Weiss
-------------------------- ----------------------------
Name: David S. Weiss
Executive Vice President and
Chief Financial Officer
15
<PAGE>
EXHIBIT 11
BEAZER HOMES USA, INC.
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
Three Nine
Months Ended Months Ended
June 30, June 30,
--------------------- -----------------------
1996 1995 1996 1995
--------------------- -----------------------
<S> <C> <C> <C> <C>
Primary:
Earnings
Net income $ 4,817 $ 1,417 $ 11,379 $ 5,035
Less: Dividends on preferred shares (a) 1,000 0 3,000 0
---------- ---------- ---------- ----------
Net income applicable to common shares $ 3,817 $ 1,417 $ 8,379 $ 5,035
========== ========== ========== ==========
Shares
Weighted average number of unrestricted
common shares outstanding 6,376,100 8,916,576 6,376,100 9,055,770
Weighted average number of restricted
common shares outstanding, net 92,650 171,750 90,726 146,259
Dilutive effect of outstanding options
as determined by the application of the
treasury stock method 11,973 0 19,697 0
---------- ---------- ---------- ----------
Weighted average number of shares
outstanding, as adjusted 6,480,723 9,088,326 6,486,523 9,202,029
========== ========== ========== ==========
Primary net income per share $0.59 $0.16 $1.29 $0.55
========== ========== ========== ==========
Fully-diluted:
Earnings
Net income $4,817 $ 1,417 $ 11,379 $ 5,035
========== ========== ========== ==========
Shares
Weighted average number of unrestricted
common shares outstanding 6,376,100 8,916,576 6,376,100 9,055,770
Weighted average number of restricted
common shares outstanding, net 92,650 171,750 90,726 146,259
Dilutive effect of outstanding options
as determined by the application of
the treasury stock method 11,973 0 19,697 0
Assumed conversion of preferred stock (a) 2,624,672 0 2,624,672 0
---------- ---------- ---------- ----------
Weighted average number of shares
outstanding, as adjusted 9,105,395 9,088,326 9,111,195 9,202,029
========== ========== ========== ==========
Net income per share assuming full dilution $0.53 $0.16 $1.25 $0.55
========== ========== ========== ==========
</TABLE>
__________________
(a) The Company's Series A Cumulative Convertible Exchangeable Preferred Stock
(2,000,000 shares of $50,000,000 aggregate liquidation preference,
convertible into 2,624,672 shares of common stock) issued in August 1995.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S QUARTERLY REPORT ON FORM 10Q FOR THE PERIOD ENDED JUNE 30, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1995
<PERIOD-END> JUN-30-1996
<CASH> 952
<SECURITIES> 0
<RECEIVABLES> 4,396
<ALLOWANCES> 0
<INVENTORY> 359,355
<CURRENT-ASSETS> 0 <F1> <F2>
<PP&E> 2,585 <F1>
<DEPRECIATION> 0
<TOTAL-ASSETS> 383,504
<CURRENT-LIABILITIES> 0
<BONDS> 147,000
0
20
<COMMON> 93
<OTHER-SE> 173,099
<TOTAL-LIABILITY-AND-EQUITY> 383,504
<SALES> 571,800
<TOTAL-REVENUES> 571,800
<CGS> 494,247
<TOTAL-COSTS> 552,905
<OTHER-EXPENSES> (71)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,637
<INCOME-PRETAX> 18,966
<INCOME-TAX> 7,587
<INCOME-CONTINUING> 11,379
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,379
<EPS-PRIMARY> 1.29
<EPS-DILUTED> 1.25
<FN>
<F1>PROPERTY, PLANT, AND EQUIPMENT IS PRESENTED NET OF ACCUMULATED DEPRECIATION.
<F2>THE COMPANY PRESENTS A CONDENSED BALANCE SHEET FOR INTERIM PERIODS.
</FN>
</TABLE>
