M/I Homes, Inc., Columbus (NYSE:MHO) on Wednesday morning reported a net profit of $16.9 million, or $0.55 per diluted share, for the first quarter ended March 31, 2017. The gain compares to net income of $9.2 million, or $0.30 per diluted share, for the first quarter of 2016. The first quarter of 2016 included a $1.3 million after-tax charge for stucco-related repairs in several M/I Florida communities. Analysts were expecting a profit of $0.39 per share.
Homes delivered in 2017’s first quarter increased 18% to a first quarter record of 1,038. This compares to 876 homes delivered in 2016’s first quarter.
New orders for the quarter reached an all-time quarterly record of 1,454, increasing 11% from the 1,314 contracts recorded in 2016’s first quarter.
Homes in backlog at March 31, 2017 had a total sales value of $834 million, a 14% increase over a year ago, with backlog units of 2,220 and an average sales price of $376,000. At March 31, 2016, backlog sales value was $730 million, with backlog units of 1,969 and an average sales price of $371,000.
M/I Homes had 184 active communities at March 31, 2017 compared to 181 at March 31, 2016. The Company’s cancellation rate was 14% in the first quarter of 2017 compared to 11% in 2016’s first quarter.
“We had a very strong first quarter highlighted by a 56% increase in pre-tax income, a 170 basis point increase in our operating margin, and a number of record-setting achievements,” said Robert H. Schottenstein, president and CEO. “We had record first quarter revenue of $407 million, record first quarter homes delivered of 1,038, and record new contracts of 1,454. Homes delivered were 18% higher than 2016’s first quarter and new contracts improved by 11%. In addition, first quarter backlog reached a 10-year high with a sales value of $834 million – 14% better than a year ago. We were very pleased with our gross margin improvement, and our operating margin rose to 7.8%. We also opened a record 24 new communities during the quarter, increasing our community count to 184.”
Schottenstein continued, “We are off to a very good start in 2017. We have a healthy backlog and housing market conditions remain favorable throughout most of our markets. Our financial condition is strong with shareholders’ equity of $672 million and home-building debt to capital of 45%. We will continue to focus on increasing profitability, growing our market share, and investing in attractive land opportunities.”
