Century Communities, Inc. [CCS] Filings

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

10-Q 1 ccs-20220630x10q.htm 10-Q ccs-20220630x10q

UNITED STATES

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 June 30, 2022


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

Commission File Number: 001-36491

Century Communities, Inc.

(Exact name of registrant as specified in its charter)


Delaware		68-0521411
(State or other jurisdiction of ‎incorporation or organization)		(I.R.S. Employer ‎Identification No.)

8390 East Crescent Parkway, Suite 650 ‎Greenwood Village, CO		80111
(Address of principal executive offices)		(Zip Code)

(Registrant’s telephone number, including area code): (303) 770-8300

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common stock, par value $0.01 per share	CCS	New York Stock Exchange

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 o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

On July 22, 2022, 32,273,160 shares of common stock, par value $0.01 per share, of the registrant were outstanding.

Table of Contents

CENTURY COMMUNITIES, INC.

FORM 10-Q

For the Three and Six Months Ended June 30, 2022

Index


	Page No.
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of June 30, 2022 (unaudited) and December 31, 2021 (audited)	3
Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2022 and 2021	4
Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2022 and 2021	5
Unaudited Condensed Consolidated Statements of Stockholders' Equity for the Three and Six Months Ended June 30, 2022 and 2021	6
Notes to the Unaudited Condensed Consolidated Financial Statements	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3. Quantitative and Qualitative Disclosures About Market Risk	38
Item 4. Controls and Procedures	38
PART II – OTHER INFORMATION
Item 1. Legal Proceedings	39
Item 1A. Risk Factors	39
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3. Defaults Upon Senior Securities	39
Item 4. Mine Safety Disclosures	39
Item 5. Other Information	39
Item 6. Exhibits	40
Signatures	41

Table of Contents

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

Century Communities, Inc.

Condensed Consolidated Balance Sheets

As of June 30, 2022 and December 31, 2021

(in thousands, except share and per share amounts)



	June 30,		December 31,
	2022		2021
Assets	(unaudited)		(audited)
Cash and cash equivalents	$	78,011	$	316,310
Cash held in escrow		82,494		52,297
Accounts receivable		58,755		41,932
Inventories		3,002,338		2,456,614
Mortgage loans held for sale		216,367		353,063
Prepaid expenses and other assets		257,715		200,087
Property and equipment, net		27,304		24,939
Deferred tax assets, net		19,356		21,239
Goodwill		30,395		30,395
Total assets	$	3,772,735	$	3,496,876
Liabilities and stockholders' equity
Liabilities:
Accounts payable	$	117,390	$	84,679
Accrued expenses and other liabilities		344,549		316,877
Notes payable		1,009,631		998,936
Revolving line of credit		141,000		—
Mortgage repurchase facilities		209,001		331,876
Total liabilities		1,821,571		1,732,368
Stockholders' equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized, none outstanding		—		—
Common stock, $0.01 par value, 100,000,000 shares authorized, 32,273,160 and 33,760,940 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively		323		338
Additional paid-in capital		596,727		697,845
Retained earnings		1,354,114		1,066,325
Total stockholders' equity		1,951,164		1,764,508
Total liabilities and stockholders' equity	$	3,772,735	$	3,496,876

See Notes to Unaudited Condensed Consolidated Financial Statements

Table of Contents

Century Communities, Inc.

Unaudited Condensed Consolidated Statements of Operations

For the Three and Six Months Ended June 30, 2022 and 2021

(in thousands, except share and per share amounts)



	Three Months Ended June 30,				Six Months Ended June 30,
	2022		2021		2022		2021
Revenues
Homebuilding revenues
Home sales revenues	$	1,134,535	$	1,004,789	$	2,122,950	$	1,964,068
Land sales and other revenues		8,810		8,258		10,440		23,928
Total homebuilding revenues		1,143,345		1,013,047		2,133,390		1,987,996
Financial services revenues		22,797		29,865		49,102		63,485
Total revenues		1,166,142		1,042,912		2,182,492		2,051,481
Homebuilding cost of revenues
Cost of home sales revenues		(814,895)		(764,668)		(1,523,968)		(1,521,175)
Cost of land sales and other revenues		(8,012)		(7,000)		(8,858)		(17,020)
Total homebuilding cost of revenues		(822,907)		(771,668)		(1,532,826)		(1,538,195)
Financial services costs		(14,186)		(18,168)		(29,340)		(36,469)
Selling, general and administrative		(109,158)		(99,656)		(210,797)		(191,807)
Inventory impairment and other		—		(41)		—		(41)
Other income (expense)		(6,243)		(1,245)		(7,105)		(1,786)
Income before income tax expense		213,648		152,134		402,424		283,183
Income tax expense		(54,980)		(34,224)		(101,260)		(63,621)
Net income	$	158,668	$	117,910	$	301,164	$	219,562

Earnings per share:
Basic	$	4.83	$	3.49	$	9.08	$	6.52
Diluted	$	4.78	$	3.47	$	8.97	$	6.47
Weighted average common shares outstanding:
Basic		32,839,402		33,738,586		33,183,097		33,651,727
Diluted		33,227,383		33,956,638		33,582,900		33,920,939

See Notes to Unaudited Condensed Consolidated Financial Statements

Table of Contents

Century Communities, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

For the Six Months Ended June 30, 2022 and 2021

(in thousands)


	Six Months Ended June 30,
	2022		2021
Operating activities
Net income	$	301,164	$	219,562
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization		5,352		5,655
Stock-based compensation expense		9,791		7,212
Fair value of mortgage loans held for sale and other		5,322		3,359
Inventory impairment and other		—		41
Deferred income taxes		1,883		(5,942)
Loss on disposition of assets		1,067		804
Changes in assets and liabilities:
Cash held in escrow		(30,197)		(14,491)
Accounts receivable		(15,624)		(8,505)
Inventories		(493,618)		(56,779)
Mortgage loans held for sale		128,114		42,659
Prepaid expenses and other assets		(23,572)		(25,694)
Accounts payable		32,466		(27,103)
Accrued expenses and other liabilities		(25,035)		2,643
Net cash (used in) provided by operating activities		(102,887)		143,421
Investing activities
Purchases of property and equipment		(8,785)		(4,405)
Expenditures related to development of rental properties		(13,618)		—
Other investing activities		(2,879)		54
Net cash used in investing activities		(25,282)		(4,351)
Financing activities
Borrowings under revolving credit facilities		571,000		—
Payments on revolving credit facilities		(430,000)		—
Proceeds from issuance of insurance premium notes and other		18,031		9,477
Principal payments on insurance premium notes and other		(9,043)		(3,854)
Net payments for mortgage repurchase facilities		(122,875)		(99,274)
Withholding of common stock upon vesting of stock-based compensation awards		(12,735)		(13,726)
Repurchases of common stock under stock repurchase program		(98,305)		—
Dividend payments		(13,225)		(5,065)
Other financing activities		879		(34)
Net cash used in financing activities		(96,273)		(112,476)
Net (decrease) increase	$	(224,442)	$	26,594
Cash and cash equivalents and Restricted cash
Beginning of period		322,241		398,081
End of period	$	97,799	$	424,675
Supplemental cash flow disclosure
Cash paid for income taxes	$	117,476	$	78,909
Cash and cash equivalents and Restricted cash
Cash and cash equivalents	$	78,011	$	419,416
Restricted cash (Note 5)		19,788		5,259
Cash and cash equivalents and Restricted cash	$	97,799	$	424,675

See Notes to Unaudited Condensed Consolidated Financial Statements

Table of Contents

Century Communities, Inc.

Unaudited Condensed Consolidated Statements of Stockholders’ Equity

For the Three and Six Months Ended June 30, 2022 and 2021

(in thousands)

For the Three Months Ended June 30, 2022 and 2021


	Common Stock
	Shares	Amount		Additional Paid-In Capital		Retained Earnings		Total Stockholders' Equity
Balance at March 31, 2022	33,038	$	330	$	627,447	$	1,202,085	$	1,829,862
Vesting of stock-based compensation awards	36		—		—		—		—
Withholding of common stock upon vesting of stock-based compensation awards	(10)		—		(598)		—		(598)
Repurchases of common stock	(791)		(7)		(35,920)		—		(35,927)
Stock-based compensation expense	—		—		5,727		—		5,727
Cash dividends declared and dividend equivalents	—		—		71		(6,639)		(6,568)
Net income	—		—		—		158,668		158,668
Balance at June 30, 2022	32,273	$	323	$	596,727	$	1,354,114	$	1,951,164


Balance at March 31, 2021	33,708	$	337	$	688,009	$	684,823	$	1,373,169
Vesting of stock-based compensation awards	74		1		(1)		—		—
Withholding of common stock upon vesting of stock-based compensation awards	(21)		—		(1,549)		—		(1,549)
Stock-based compensation expense	—		—		4,193		—		4,193
Cash dividends declared and dividend equivalents	—		—		55		(5,120)		(5,065)
Net income	—		—		—		117,910		117,910
Balance at June 30, 2021	33,761	$

Century Communities, Inc. [CCS] Filings
10-Q	[2022-07-28]
10-Q	[2022-04-28]
10-K	[2022-02-03]
10-Q	[2021-10-28]
10-Q	[2021-07-29]
10-Q	[2021-04-29]
10-K	[2021-02-05]
10-Q	[2020-10-29]
10-Q	[2020-07-29]
10-Q	[2020-04-30]
10-K	[2020-02-07]
10-Q	[2019-10-30]
10-Q	[2019-07-31]
10-Q	[2019-05-03]
10-K	[2019-02-13]
10-Q	[2018-11-07]
10-Q	[2018-08-03]
10-Q	[2018-05-09]
10-K	[2018-03-01]
10-Q	[2017-11-03]
10-Q	[2017-08-04]
10-Q	[2017-05-05]
10-K	[2017-02-15]
10-Q	[2016-11-02]
10-Q	[2016-08-03]
10-Q	[2016-05-06]
10-K	[2016-02-19]
10-Q	[2015-11-06]
10-Q	[2015-08-07]
10-Q	[2015-05-08]
10-K	[2015-03-06]
10-Q	[2014-11-14]
10-Q	[2014-08-13]
S-1	[2014-05-05]