tmhc-20220331False2022Q1000156247612/31P2YP5DP5D00015624762022-01-012022-03-3100015624762022-04-27xbrli:shares00015624762022-03-31iso4217:USD00015624762021-12-310001562476tmhc:HomeSalesMember2022-01-012022-03-310001562476tmhc:HomeSalesMember2021-01-012021-03-310001562476tmhc:LandSalesMember2022-01-012022-03-310001562476tmhc:LandSalesMember2021-01-012021-03-310001562476tmhc:FinancialServicesMember2022-01-012022-03-310001562476tmhc:FinancialServicesMember2021-01-012021-03-310001562476tmhc:AmenityMember2022-01-012022-03-310001562476tmhc:AmenityMember2021-01-012021-03-3100015624762021-01-012021-03-31iso4217:USDxbrli:shares0001562476us-gaap:CommonStockMember2021-12-310001562476us-gaap:AdditionalPaidInCapitalMember2021-12-310001562476us-gaap:TreasuryStockMember2021-12-310001562476us-gaap:RetainedEarningsMember2021-12-310001562476us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001562476us-gaap:NoncontrollingInterestMember2021-12-310001562476us-gaap:RetainedEarningsMember2022-01-012022-03-310001562476us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001562476us-gaap:CommonStockMember2022-01-012022-03-310001562476us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001562476us-gaap:TreasuryStockMember2022-01-012022-03-310001562476us-gaap:CommonStockMember2022-03-310001562476us-gaap:AdditionalPaidInCapitalMember2022-03-310001562476us-gaap:TreasuryStockMember2022-03-310001562476us-gaap:RetainedEarningsMember2022-03-310001562476us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310001562476us-gaap:NoncontrollingInterestMember2022-03-310001562476us-gaap:CommonStockMember2020-12-310001562476us-gaap:AdditionalPaidInCapitalMember2020-12-310001562476us-gaap:TreasuryStockMember2020-12-310001562476us-gaap:RetainedEarningsMember2020-12-310001562476us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001562476us-gaap:NoncontrollingInterestMember2020-12-3100015624762020-12-310001562476us-gaap:RetainedEarningsMember2021-01-012021-03-310001562476us-gaap:NoncontrollingInterestMember2021-01-012021-03-310001562476us-gaap:CommonStockMember2021-01-012021-03-310001562476us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001562476us-gaap:TreasuryStockMember2021-01-012021-03-310001562476us-gaap:CommonStockMember2021-03-310001562476us-gaap:AdditionalPaidInCapitalMember2021-03-310001562476us-gaap:TreasuryStockMember2021-03-310001562476us-gaap:RetainedEarningsMember2021-03-310001562476us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001562476us-gaap:NoncontrollingInterestMember2021-03-3100015624762021-03-31tmhc:segment0001562476srt:MinimumMember2022-01-012022-03-310001562476srt:MaximumMember2022-01-012022-03-310001562476tmhc:StockOptionsandRestrictedStockUnitsRSUsMember2022-01-012022-03-310001562476tmhc:StockOptionsandRestrictedStockUnitsRSUsMember2021-01-012021-03-310001562476us-gaap:PublicUtilitiesInventoryRawMaterialsMemberus-gaap:WhollyOwnedPropertiesMember2022-03-31tmhc:lot0001562476us-gaap:PublicUtilitiesInventoryRawMaterialsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:PublicUtilitiesInventoryRawMaterialsMemberus-gaap:WhollyOwnedPropertiesMember2021-12-310001562476us-gaap:PublicUtilitiesInventoryRawMaterialsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476tmhc:InventoryRealEstatePartiallyDevelopedMemberus-gaap:WhollyOwnedPropertiesMember2022-03-310001562476tmhc:InventoryRealEstatePartiallyDevelopedMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476tmhc:InventoryRealEstatePartiallyDevelopedMemberus-gaap:WhollyOwnedPropertiesMember2021-12-310001562476tmhc:InventoryRealEstatePartiallyDevelopedMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476tmhc:InventoryRealEstateFinishedMemberus-gaap:WhollyOwnedPropertiesMember2022-03-310001562476tmhc:InventoryRealEstateFinishedMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476tmhc:InventoryRealEstateFinishedMemberus-gaap:WhollyOwnedPropertiesMember2021-12-310001562476tmhc:InventoryRealEstateFinishedMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476us-gaap:WhollyOwnedPropertiesMembertmhc:HomebuildingOwnedLotsMember2022-03-310001562476us-gaap:CarryingReportedAmountFairValueDisclosureMembertmhc:HomebuildingOwnedLotsMember2022-03-310001562476us-gaap:WhollyOwnedPropertiesMembertmhc:HomebuildingOwnedLotsMember2021-12-310001562476us-gaap:CarryingReportedAmountFairValueDisclosureMembertmhc:HomebuildingOwnedLotsMember2021-12-310001562476us-gaap:WhollyOwnedPropertiesMembertmhc:InventoryRealEstateOtherAssetsMember2022-03-310001562476tmhc:InventoryRealEstateOtherAssetsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:WhollyOwnedPropertiesMembertmhc:InventoryRealEstateOtherAssetsMember2021-12-310001562476tmhc:InventoryRealEstateOtherAssetsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476us-gaap:WhollyOwnedPropertiesMember2022-03-310001562476us-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:WhollyOwnedPropertiesMember2021-12-310001562476us-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476tmhc:LandOptionPurchaseContractsMember2022-03-310001562476tmhc:LandOptionPurchaseContractsMember2021-12-310001562476tmhc:LandBankingArrangementsMember2022-03-310001562476tmhc:LandBankingArrangementsMember2021-12-310001562476tmhc:OtherControlledLotsMember2022-03-310001562476tmhc:OtherControlledLotsMember2021-12-310001562476tmhc:RefundableLandDepositsMember2022-03-310001562476tmhc:RefundableLandDepositsMember2021-12-310001562476us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberus-gaap:EquityMethodInvestmentsMember2022-03-310001562476us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberus-gaap:EquityMethodInvestmentsMember2021-12-310001562476us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberus-gaap:EquityMethodInvestmentsMember2022-01-012022-03-310001562476us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMemberus-gaap:EquityMethodInvestmentsMember2021-01-012021-03-310001562476tmhc:WilliamLyonHomesMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2022-03-310001562476us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2022-03-310001562476tmhc:WilliamLyonHomesMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2021-12-310001562476us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2021-12-310001562476tmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2022-03-31xbrli:pure0001562476tmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2022-03-310001562476us-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2021-12-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:TwoThousandTwentyEightSeniorNotesMemberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:TwoThousandTwentyEightSeniorNotesMemberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:SeniorNotesMember2022-03-310001562476us-gaap:SeniorNotesMember2021-12-310001562476tmhc:LoansPayableAndOtherBorrowingsMember2022-03-310001562476tmhc:LoansPayableAndOtherBorrowingsMember2021-12-310001562476tmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001562476tmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001562476tmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001562476tmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001562476tmhc:MortgageBorrowingsMember2022-03-310001562476tmhc:MortgageBorrowingsMember2021-12-310001562476tmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2015-04-160001562476tmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2015-04-162015-04-160001562476tmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476us-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2014-03-050001562476us-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2022-01-012022-03-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:SeniorNotesMember2019-06-050001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:SeniorNotesMember2020-02-100001562476tmhc:A6.625SeniorNotesDue2027IssuedByTMCommunitiesMemberus-gaap:SeniorNotesMember2020-02-100001562476tmhc:A6.625SeniorNotesDue2027IssuedbyWLHMemberus-gaap:SeniorNotesMember2020-02-100001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:SeniorNotesMemberus-gaap:DebtInstrumentRedemptionPeriodOneMember2022-01-012022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:DebtInstrumentRedemptionPeriodTwoMemberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:DebtInstrumentRedemptionPeriodThreeMemberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:DebtInstrumentRedemptionPeriodFourMemberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:DebtInstrumentRedemptionPeriodFiveMemberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476us-gaap:SeniorNotesMembertmhc:A5.75Notesdue2028Member2022-03-310001562476us-gaap:SeniorNotesMembertmhc:A5.75Notesdue2028Member2019-08-010001562476us-gaap:SeniorNotesMembertmhc:A5.75Notesdue2028Member2022-01-012022-03-310001562476tmhc:A6.00SeniorNotesdue2023Memberus-gaap:SeniorNotesMember2020-07-310001562476us-gaap:SeniorNotesMembertmhc:A5.875SeniorNotesdue2025Member2020-07-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:SeniorNotesMember2020-07-310001562476tmhc:A6.00SeniorNotesdue2023Memberus-gaap:SeniorNotesMember2020-09-300001562476us-gaap:SeniorNotesMembertmhc:A5.875SeniorNotesdue2025Member2020-09-300001562476tmhc:A6.00SeniorNotesdue2023Memberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476us-gaap:SeniorNotesMembertmhc:A600SeniorNotesDue2023Member2022-01-012022-03-310001562476us-gaap:SeniorNotesMembertmhc:A5.875SeniorNotesdue2025Member2022-01-012022-03-310001562476tmhc:SeniorNotesDue2023And2025Memberus-gaap:SeniorNotesMember2021-01-012021-03-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:SeniorNotesMember2022-01-012022-03-310001562476tmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-01-012022-03-310001562476tmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-01-012021-12-310001562476tmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-01-012022-03-31tmhc:fiscalQuartertmhc:equityCureRight0001562476tmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-09-170001562476tmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-01-012021-12-310001562476us-gaap:SecuredDebtMembertmhc:FlagstarAgreementMember2022-03-310001562476us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:SecuredDebtMembertmhc:FlagstarAgreementMember2022-01-012022-03-310001562476tmhc:ComericaBankMemberus-gaap:SecuredDebtMember2022-03-310001562476tmhc:ComericaBankMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:SecuredDebtMember2022-01-012022-03-310001562476tmhc:JpMorganChaseBankMemberus-gaap:SecuredDebtMember2022-03-310001562476us-gaap:LondonInterbankOfferedRateLIBORMembertmhc:JpMorganChaseBankMemberus-gaap:SecuredDebtMember2022-01-012022-03-310001562476tmhc:WarehouseDMemberus-gaap:SecuredDebtMember2022-03-310001562476us-gaap:LondonInterbankOfferedRateLIBORMembertmhc:WarehouseDMemberus-gaap:SecuredDebtMember2022-01-012022-03-310001562476us-gaap:SecuredDebtMembertmhc:WarehouseEMember2022-03-310001562476us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:SecuredDebtMembertmhc:WarehouseEMember2022-01-012022-03-310001562476us-gaap:SecuredDebtMember2022-03-310001562476us-gaap:SecuredDebtMembertmhc:FlagstarAgreementMember2021-12-310001562476us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:SecuredDebtMembertmhc:FlagstarAgreementMember2021-01-012021-12-310001562476tmhc:ComericaBankMemberus-gaap:SecuredDebtMember2021-12-310001562476tmhc:ComericaBankMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:SecuredDebtMember2021-01-012021-12-310001562476tmhc:JpMorganChaseBankMemberus-gaap:SecuredDebtMember2021-12-310001562476us-gaap:LondonInterbankOfferedRateLIBORMembertmhc:JpMorganChaseBankMemberus-gaap:SecuredDebtMember2021-01-012021-12-310001562476tmhc:WarehouseDMemberus-gaap:SecuredDebtMember2021-12-310001562476us-gaap:LondonInterbankOfferedRateLIBORMembertmhc:WarehouseDMemberus-gaap:SecuredDebtMember2021-01-012021-12-310001562476us-gaap:SecuredDebtMembertmhc:WarehouseEMember2021-12-310001562476us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:SecuredDebtMembertmhc:WarehouseEMember2021-01-012021-12-310001562476us-gaap:SecuredDebtMember2021-12-310001562476srt:MinimumMemberus-gaap:NotesPayableOtherPayablesMember2022-03-310001562476srt:MinimumMemberus-gaap:NotesPayableOtherPayablesMember2021-12-310001562476srt:MaximumMemberus-gaap:NotesPayableOtherPayablesMember2022-03-310001562476srt:MaximumMemberus-gaap:NotesPayableOtherPayablesMember2021-12-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2022-03-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2021-12-310001562476us-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateLockCommitmentsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateLockCommitmentsMember2022-03-310001562476us-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateLockCommitmentsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateLockCommitmentsMember2021-12-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:DebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:DebtMember2022-03-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:DebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:DebtMember2021-12-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMembertmhc:MortgageBorrowingsMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:MortgageBorrowingsMember2022-03-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMembertmhc:MortgageBorrowingsMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:MortgageBorrowingsMember2021-12-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMembertmhc:LoansPayableAndOtherBorrowingsMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:LoansPayableAndOtherBorrowingsMember2022-03-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMembertmhc:LoansPayableAndOtherBorrowingsMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:LoansPayableAndOtherBorrowingsMember2021-12-310001562476us-gaap:FairValueInputsLevel2Membertmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2022-03-310001562476us-gaap:FairValueInputsLevel2Membertmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:TwoThousandTwentyThreeSeniorNotesMemberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2022-03-310001562476us-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMembertmhc:TwoThousandTwentyFourSeniorNotesMember2021-12-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:TwoThousandTwentySevenSeniorNotesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMembertmhc:A6.625SeniorNotesDue2027Memberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:A6.625SeniorNotesDue2027Memberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMembertmhc:A6.625SeniorNotesDue2027Memberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:TwoThousandTwentyEightSeniorNotesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMembertmhc:TwoThousandTwentyEightSeniorNotesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:TwoThousandTwentyEightSeniorNotesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMembertmhc:TwoThousandTwentyEightSeniorNotesMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2022-03-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:FairValueInputsLevel2Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:SeniorNotesMember2021-12-310001562476tmhc:A5125SeniorNotesDue2030Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Memberus-gaap:SeniorNotesMember2021-12-310001562476us-gaap:FairValueInputsLevel2Membertmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001562476us-gaap:FairValueInputsLevel2Membertmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:A800MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001562476us-gaap:FairValueInputsLevel2Membertmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2022-03-310001562476us-gaap:FairValueInputsLevel2Membertmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001562476us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Membertmhc:A100MillionRevolvingCreditFacilityMemberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMember2021-12-310001562476us-gaap:FairValueInputsLevel1Memberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-03-310001562476us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-03-310001562476us-gaap:FairValueInputsLevel1Memberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001562476us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001562476tmhc:RestrictedStockUnitsAndPerformanceBasedRestrictedStockUnitsMember2022-03-310001562476us-gaap:EmployeeStockOptionMember2022-03-310001562476us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-03-310001562476us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310001562476us-gaap:EmployeeStockOptionMember2022-01-012022-03-310001562476us-gaap:EmployeeStockOptionMember2021-01-012021-03-310001562476us-gaap:OperatingSegmentsMembertmhc:EastHomebuildingSegmentMember2022-01-012022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:CentralSegmentMember2022-01-012022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:WestHomebuildingSegmentMember2022-01-012022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:FinancialServicesMember2022-01-012022-03-310001562476tmhc:CorporateAndReconcilingItemsMember2022-01-012022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:EastHomebuildingSegmentMember2021-01-012021-03-310001562476us-gaap:OperatingSegmentsMembertmhc:CentralSegmentMember2021-01-012021-03-310001562476us-gaap:OperatingSegmentsMembertmhc:WestHomebuildingSegmentMember2021-01-012021-03-310001562476us-gaap:OperatingSegmentsMembertmhc:FinancialServicesMember2021-01-012021-03-310001562476tmhc:CorporateAndReconcilingItemsMember2021-01-012021-03-310001562476us-gaap:OperatingSegmentsMembertmhc:EastHomebuildingSegmentMember2022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:CentralSegmentMember2022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:WestHomebuildingSegmentMember2022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:FinancialServicesMember2022-03-310001562476tmhc:CorporateAndReconcilingItemsMember2022-03-310001562476us-gaap:OperatingSegmentsMembertmhc:EastHomebuildingSegmentMember2021-12-310001562476us-gaap:OperatingSegmentsMembertmhc:CentralSegmentMember2021-12-310001562476us-gaap:OperatingSegmentsMembertmhc:WestHomebuildingSegmentMember2021-12-310001562476us-gaap:OperatingSegmentsMembertmhc:FinancialServicesMember2021-12-310001562476tmhc:CorporateAndReconcilingItemsMember2021-12-310001562476tmhc:LandOptionPurchaseContractsAndLandBankingArrangementsMember2022-03-310001562476tmhc:LandOptionPurchaseContractsAndLandBankingArrangementsMember2021-12-310001562476srt:MaximumMember2021-11-020001562476srt:MinimumMember2021-11-020001562476us-gaap:InterestRateLockCommitmentsMember2022-03-310001562476us-gaap:InterestRateLockCommitmentsMember2021-12-310001562476us-gaap:MortgageBackedSecuritiesMember2022-03-310001562476us-gaap:MortgageBackedSecuritiesMember2021-12-31
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
| | | | | |
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2022
OR
| | | | | |
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number: 001-35873
TAYLOR MORRISON HOME CORPORATION
(Exact name of registrant as specified in its Charter)
| | | | | | | | |
| Delaware | | 83-2026677 |
(State or other jurisdiction of
incorporation or organization) | | (I.R.S. Employer
Identification No.) |
| | | | | | | | | | | |
| 4900 N. Scottsdale Road, Suite 2000 | | 85251 |
| Scottsdale, | Arizona | | |
| (Address of principal executive offices) | | (Zip Code) |
(480) 840-8100
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | | | |
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | |
| Common Stock, $0.00001 par value | TMHC | 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 ý No ¨
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 ý No ¨
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.
| | | | | | | | | | | | | | | | | | | | |
| Large Accelerated Filer | | ☒ | | Accelerated filer | | ☐ |
| | | |
| Non-accelerated filer | | ¨ | | Smaller reporting company | | ☐ |
| | | | | | |
| Emerging growth company | | ☐ | | | | |
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 ☐ No ý
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
| | | | | | | | |
| Class | | Outstanding as of April 27, 2022 |
| Common stock, $0.00001 par value | | 119,638,931 |
TAYLOR MORRISON HOME CORPORATION
TABLE OF CONTENTS
PART I — FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TAYLOR MORRISON HOME CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)
| | | | | | | | | | | | | | |
| | March 31,
2022 | | December 31,
2021 |
| Assets | | | | |
| Cash and cash equivalents | | $ | 569,249 | | | $ | 832,821 | |
| Restricted cash | | 1,578 | | | 3,519 | |
| Total cash, cash equivalents, and restricted cash | | 570,827 | | | 836,340 | |
| | | | |
| Owned inventory | | 5,699,709 | | | 5,444,207 | |
| Consolidated real estate not owned | | 43,418 | | | 55,314 | |
| Total real estate inventory | | 5,743,127 | | | 5,499,521 | |
| Land deposits | | 260,861 | | | 229,535 | |
| Mortgage loans held for sale | | 229,651 | | | 467,534 | |
| Derivative assets | | 5,501 | | | 2,110 | |
| Lease right of use assets | | 85,582 | | | 85,863 | |
| Prepaid expenses and other assets, net | | 271,180 | | | 314,986 | |
| Other receivables, net | | 155,660 | | | 150,864 | |
| Investments in unconsolidated entities | | 173,231 | | | 171,406 | |
| Deferred tax assets, net | | 151,240 | | | 151,240 | |
| Property and equipment, net | | 207,918 | | | 155,181 | |
| | | | |
| Goodwill | | 663,197 | | | 663,197 | |
| | | | |
| Total assets | | $ | 8,517,975 | | | $ | 8,727,777 | |
| Liabilities | | | | |
| Accounts payable | | $ | 225,312 | | | $ | 253,348 | |
| Accrued expenses and other liabilities | | 416,881 | | | 525,209 | |
| Lease liabilities | | 94,405 | | | 96,172 | |
| Income taxes payable | | 15,350 | | | — | |
| Customer deposits | | 540,916 | | | 485,705 | |
| Estimated development liabilities | | 38,522 | | | 38,923 | |
| Senior notes, net | | 2,452,311 | | | 2,452,322 | |
| Loans payable and other borrowings | | 395,400 | | | 404,386 | |
| Revolving credit facility borrowings | | — | | | 31,529 | |
| Mortgage warehouse borrowings | | 200,662 | | | 413,887 | |
| Liabilities attributable to consolidated real estate not owned | | 43,418 | | | 55,314 | |
| | | | |
| Total liabilities | | $ | 4,423,177 | | | $ | 4,756,795 | |
| COMMITMENTS AND CONTINGENCIES (Note 13) | | | | |
| Stockholders’ Equity | | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| Total stockholders’ equity | | 4,094,798 | | | 3,970,982 | |
| Total liabilities and stockholders’ equity | | $ | 8,517,975 | | | $ | 8,727,777 | |
See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements
TAYLOR MORRISON HOME CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts, unaudited)
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
March 31, | | |
| | | 2022 | | 2021 | | | | |
| Home closings revenue, net | | $ | 1,644,409 | | | $ | 1,363,429 | | | | | |
| Land closings revenue | | 15,610 | | | 4,889 | | | | | |
| Financial services revenue | | 35,199 | | | 44,065 | | | | | |
| Amenity and other revenue | | 7,906 | | | 5,429 | | | | | |
| Total revenue | | 1,703,124 | | | 1,417,812 | | | | | |
| Cost of home closings | | 1,264,974 | | | 1,110,242 | | | | | |
| Cost of land closings | | 14,364 | | | 4,027 | | | | | |
| Financial services expenses | | 24,214 | | | 23,999 | | | | | |
| Amenity and other expenses | | 6,444 | | | 5,103 | | | | | |
| Total cost of revenue | | 1,309,996 | | | 1,143,371 | | | | | |
| Gross margin | | 393,128 | | | 274,441 | | | | | |
| Sales, commissions and other marketing costs | | 89,123 | | | 85,952 | | | | | |
| General and administrative expenses | | 68,142 | | | 61,553 | | | | | |
| Equity in income of unconsolidated entities | | (1,831) | | | (5,661) | | | | | |
| Interest expense/(income), net | | 4,252 | | | (119) | | | | | |
| Other expense, net | | 542 | | | 975 | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Income before income taxes | | 232,900 | | | 131,741 | | | | | |
| Income tax provision | | 54,439 | | | 29,298 | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Net income before allocation to non-controlling interests | | 178,461 | | | 102,443 | | | | | |
| Net income attributable to non-controlling interests | | (1,758) | | | (4,422) | | | | | |
| | | | | | | | |
| | | | | | | | |
| Net income available to Taylor Morrison Home Corporation | | $ | 176,703 | | | $ | 98,021 | | | | | |
| Earnings per common share | | | | | | | | |
| Basic | | $ | 1.46 | | | $ | 0.76 | | | | | |
| Diluted | | $ | 1.44 | | | $ | 0.75 | | | | | |
| Weighted average number of shares of common stock: | | | | | | | | |
| Basic | | 121,186 | | | 128,883 | | | | | |
| Diluted | | 122,657 | | | 131,246 | | | | | |
See accompanying Notes to the Unaudited Condensed Consolidated Financial Statements
TAYLOR MORRISON HOME CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands, unaudited)
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended March 31, | | |
| | | 2022 | | 2021 | | | | |
| Comprehensive Income before non-controlling interests, net of tax | | $ | 178,461 | | | $ | 102,443 | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Comprehensive income attributable to non-controlling interests | | (1,758) | | | (4,422) | | | | | |
| | | | | | | | |
| Comprehensive income available to Taylor Morrison Home Corporation | | $ | 176,703 | | | $ | 98,021 | | | | | |
See accompanying Notes to Unaudited Condensed Consolidated Financial Statements
TAYLOR MORRISON HOME CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
(In thousands, except share data, unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
For the three months ended March 31, 2022 |
| | | | | | | | | | | | | | | | | | |
| | | Common Stock | | | | Additional
Paid-in
Capital | | Treasury Stock | | Stockholders' Equity |
| | | Shares | | Amount | | | | | | Amount | | Shares | | Amount | | Retained
Earnings | | Accumulated
Other
Comprehensive
Loss | | Non-controlling
Interest | | | | Total
Stockholders’
Equity |
Balance – December 31, 2021 | | 121,833,649 | | | $ | 1 | | | | | | | $ | 2,997,211 | | | 36,828,559 | | | $ | (760,863) | | | $ | 1,688,815 | | | $ | 689 | | | $ | 45,129 | | | | | $ | 3,970,982 | |
| Net income | | — | | | | | | | | | — | | | — | | | — | | | 176,703 | | | — | | | 1,758 | | | | | 178,461 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Exercise of stock options | | 101,076 | | | | | | | | | 2,356 | | | — | | | — | | | — | | | — | | | — | | | | | 2,356 | |
Issuance of restricted stock units, net of shares withheld for tax(1) | | 378,852 | | | | | | | | | (3,621) | | | — | | | — | | | — | | | — | | | — | | | | | (3,621) | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Repurchase of common stock | | (1,948,187) | | | | | | | | | — | | | 1,948,187 | | | (58,029) | | | — | | | — | | | — | | | | | (58,029) | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Stock compensation expense | | — | | | | | | | | | 6,863 | | | — | | | — | | | — | | | — | | | — | | | | | 6,863 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Distributions to non-controlling interests of consolidated joint ventures | | — | | | | | | | | | — | | | — | | | — | | | — | | | — | | | (1,752) | | | | | (1,752) | |
| Changes in non-controlling interests of consolidated joint ventures | | — | | | | | | | | | — | | | — | | | — | | | — | | | — | | | (462) | | | | | (462) | |
Balance – March 31, 2022 | | 120,365,390 | | | $ | 1 | | | | | | | $ | 3,002,809 | | | 38,776,746 | | | $ | (818,892) | | | $ | 1,865,518 | | | $ | 689 | | | $ | 44,673 | | | | | $ | 4,094,798 | |
(1) Dollar amount represents the value of shares withheld for taxes.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
For the three months ended March 31, 2021 | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | Common Stock | | | | Additional
Paid-in
Capital | | Treasury Stock | | Stockholders' Equity |
| | | Shares | | Amount | | | | | | Amount | | Shares | | Amount | | Retained
Earnings | | Accumulated
Other
Comprehensive
Income | | Non-controlling
Interest | | | | Total
Stockholders’
Equity |
Balance – December 31, 2020 | | 129,476,914 | | | $ | 1 | | | | | | | $ | 2,926,773 | | | 25,884,756 | | | $ | (446,856) | | | $ | 1,025,789 | | | $ | (1,166) | | | $ | 89,209 | | | | | $ | 3,593,750 | |
| Net income | | — | | | — | | | | | | | — | | | — | | | — | | | 98,021 | | | — | | | 4,422 | | | | | 102,443 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Exercise of stock options | | 349,675 | | | — | | | | | | | 6,320 | | | — | | | — | | | — | | | — | | | — | | | | | 6,320 | |
Issuance of restricted stock units, net of shares withheld for tax(1) | | 357,213 | | | — | | | | | | | (4,664) | | | — | | | — | | | — | | | — | | | — | | | | | (4,664) | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Repurchase of common stock | | (1,447,309) | | | — | | | | | | | — | | | 1,447,309 | | | (38,418) | | | — | | | — | | | — | | | | | (38,418) | |
| Stock compensation expense | | — | | | — | | | | | | | 5,682 | | | — | | | — | | | — | | | — | | | — | | | | | 5,682 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Distributions to non-controlling interests of consolidated joint ventures | | — | | | — | | | | | | | — | | | — | | | — | | | — | | | — | | | (7,961) | | | | | (7,961) | |
| Changes in non-controlling interests of consolidated joint ventures | | — | | | — | | | | | | | — | | | — | | | — | | | — | | | — | | | (1,588) | | | | | (1,588) | |
Balance – March 31, 2021 | | 128,736,493 | | | $ | 1 | | | | | | | $ | 2,934,111 | | | 27,332,065 | | | $ | (485,274) | | | $ | 1,123,810 | | | $ | (1,166) | | | $ | 84,082 | | | | | $ | 3,655,564 | |
(1) Dollar amount represents the value of shares withheld for taxes.
See accompanying Notes to Unaudited Condensed Consolidated Financial Statements
TAYLOR MORRISON HOME CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands, unaudited)
| | | | | | | | | | | | | | |
| | | | |
| | | Three Months Ended March 31, |
| | | 2022 | | 2021 |
| CASH FLOWS FROM OPERATING ACTIVITIES: | | | | |
| Net income before allocation to non-controlling interests | | $ | 178,461 | | | $ | 102,443 | |
| Adjustments to reconcile net income to net cash provided by/(used in) operating activities: | | | | |
| Equity in income of unconsolidated entities | | (1,831) | | | (5,661) | |
| Stock compensation expense | | 6,863 | | | 5,682 | |
| | | | |
| Distributions of earnings from unconsolidated entities | | 2,058 | | | 3,162 | |
| Depreciation and amortization | | 8,841 | | | 9,636 | |
| Operating lease expense | | 6,913 | | | 3,969 | |
| Debt issuance costs amortization | | 191 | | | 118 | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
| Changes in operating assets and liabilities: | | | | |
| Real estate inventory and land deposits | | (286,828) | | | (356,519) | |
| Mortgages held for sale, prepaid expenses and other assets | | 171,618 | | | (85,270) | |
| Customer deposits | | 55,211 | | | 110,581 | |
| Accounts payable, accrued expenses and other liabilities | | (138,247) | | | 34,208 | |
| Income taxes payable | | 54,211 | | | 33,343 | |
| Net cash provided by/(used in) operating activities | | 57,461 | | | (144,308) | |
| CASH FLOWS FROM INVESTING ACTIVITIES: | | | | |
| Purchase of property and equipment | | (5,389) | | | (7,824) | |
| | | | |
| Distributions of capital from unconsolidated entities | | — | | | 7,451 | |
| Investments of capital into unconsolidated entities | | (2,052) | | | (13,102) | |
| | | | |
| Net cash used in investing activities | | (7,441) | | | (13,475) | |
| CASH FLOWS FROM FINANCING ACTIVITIES: | | | | |
| Increase in loans payable and other borrowings | | 18,287 | | | 36,868 | |
| Repayments on loans payable and other borrowings | | (26,688) | | | (27,580) | |
| Borrowings on revolving credit facilities | | 32,548 | | | — | |
| Repayments on revolving credit facilities | | (64,077) | | | — | |
| Borrowings on mortgage warehouse facilities | | 562,024 | | | 697,398 | |
| Repayments on mortgage warehouse facilities | | (775,249) | | | (643,854) | |
| | | | |
| | | | |
| | | | |
| | | | |
| Proceeds from stock option exercises | | 2,356 | | | 6,320 | |
| | | | |
| | | | |
| | | | |
| | | | |
| Payment of principle portion of finance lease | | (1,332) | | | (1,325) | |
| Repurchase of common stock, net | | (58,029) | | | (38,418) | |
| Payment of taxes related to net share settlement of equity awards | | (3,621) | | | (5,288) | |
| Cash and distributions to non-controlling interests of consolidated joint ventures, net | | (1,752) | | | (6,971) | |
| Net cash (used in)/provided by financing activities | | (315,533) | | | 17,150 | |
| NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | | $ | (265,513) | | | $ | (140,633) | |
| CASH, CASH EQUIVALENTS, AND RESTRICTED CASH — Beginning of period | | 836,340 | | | 534,109 | |
| CASH, CASH EQUIVALENTS, AND RESTRICTED CASH — End of period | | $ | 570,827 | | | $ | 393,476 | |
| SUPPLEMENTAL CASH FLOW INFORMATION: | | | | |
| Income tax (payments)/refund, net | | $ | (228) | | | $ | 4,592 | |
| SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES: | | | | |
| Change in loans payable issued to sellers in connection with land purchase contracts | | $ | 59,830 | | | $ | 82,378 | |
| Change in inventory not owned | | $ | (11,896) | | | $ | (64,916) | |
| | | | |
| | | | |
| | | | |
| Net non-cash distributions from non-controlling interests | | $ | — | | | $ | (990) | |
| | | | |
| | | | |
| | | | |
| | | | |
| | | | |
See accompanying Notes to Unaudited Condensed Consolidated Financial Statements
TAYLOR MORRISON HOME CORPORATION
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BUSINESS
Description of the Business — Taylor Morrison Home Corporation “TMHC” through its subsidiaries (together with TMHC referred to herein as “we,” “our,” “the Company” and “us”), owns and operates a residential homebuilding business and is a developer of lifestyle communities. We operate in the states of Arizona, California, Colorado, Florida, Georgia, Nevada, North and South Carolina, Oregon, Texas, and Washington. We provide an assortment of homes across a wide range of price points to appeal to an array of consumer groups. We design, build and sell single and multi-family detached and attached homes in traditionally high growth markets for entry level, move-up and 55-plus active lifestyle (formerly referred to as active adult) buyers. We are the general contractors for all real estate projects and retain subcontractors for home construction and land development. Our homebuilding segments operate under our Taylor Morrison, Darling Homes Collection by Taylor Morrison, and Esplanade brand names. We also have an exclusive partnership with Christopher Todd Communities, a growing Phoenix-based developer of innovative, luxury rental communities to operate a “Build-to-Rent” homebuilding business. We serve as a land acquirer, developer, and homebuilder while Christopher Todd Communities provides community design and property management consultation. In addition, we develop and construct multi-use properties consisting of commercial space, retail, and multi-family properties under the “Urban Form” brand. We also have operations which provide financial services to customers through our wholly owned mortgage subsidiary, Taylor Morrison Home Funding, Inc. (“TMHF”), title services through our wholly owned title services subsidiary, Inspired Title Services, LLC (“Inspired Title”), and homeowner’s insurance policies through our insurance agency, Taylor Morrison Insurance Services, LLC (“TMIS”). Our business is organized into multiple homebuilding operating components, and a financial services component, all of which are managed as four reportable segments: East, Central, West, and Financial Services.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Consolidation — The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2021 (the “Annual Report”). In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements include all normal and recurring adjustments that are considered necessary for the fair presentation of our results for the interim periods presented. Results for interim periods are not necessarily indicative of results to be expected for a full fiscal year.
We consolidate certain joint ventures in accordance with Accounting Standards Codification (“ASC”) Topic 810, Consolidation. The income from the percentage of the joint venture not owned by us is presented as “Net income attributable to non-controlling interests” on the Condensed Consolidated Statements of Operations.
Use of Estimates — The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the unaudited Condensed Consolidated Financial Statements and these accompanying notes. Significant estimates include real estate development costs to complete, valuation of real estate, valuation of goodwill, valuation of development liabilities, valuation of equity awards, valuation allowance on deferred tax assets, and reserves for warranty and self-insured risks. Actual results could differ from those estimates.
Goodwill — The excess of the purchase price of a business acquisition over the net fair value of assets acquired and liabilities assumed is capitalized as goodwill in accordance with ASC Topic 350, Intangibles — Goodwill and Other. ASC 350 requires that goodwill and intangible assets that do not have finite lives not be amortized, but rather assessed for impairment at least annually or more frequently if certain impairment indicators are present. We perform our annual impairment test during the fourth quarter or whenever impairment indicators are present. We did not perform an impairment test during the first quarter of 2022 as indicators of impairment were not present.
Real Estate Inventory — Inventory consists of raw land, land under development, homes under construction, completed homes, and model homes, all of which are stated at cost. In addition to direct carrying costs, we also capitalize interest, real estate taxes, and related development costs that benefit the entire community, such as field construction supervision and related direct overhead. Home vertical construction costs are accumulated and charged to cost of sales at the time of home closing using the specific identification method. Land acquisition, development, interest, and real estate taxes are allocated to homes and units generally using the relative sales value method. Generally, all overhead costs relating to purchasing, vertical
construction of a home, and construction utilities are considered overhead costs and allocated on a per unit basis. These costs are capitalized to inventory from the point development begins to the point construction is completed. Changes in estimated costs to be incurred in a community are generally allocated to the remaining lots on a prospective basis. For those communities that have been temporarily closed or development has been discontinued, we do not allocate interest or other costs to the community’s inventory until activity resumes. Such costs are expensed as incurred.
The life cycle of a typical community generally ranges from two to five years, commencing with the acquisition of unentitled or entitled land, continuing through the land development phase and concluding with the sale, construction and delivery of homes. Actual community duration will vary based on the size of the community, the sales absorption rate and whether we purchased the property as raw land or as finished lots.
We capitalize qualifying interest costs to inventory during the development and construction periods. Capitalized interest is charged to cost of sales when the related inventory is charged to cost of sales.
We assess the recoverability of our inventory in accordance with the provisions of ASC Topic 360, Property, Plant, and Equipment. We review our real estate inventory for indicators of impairment on a community-level basis during each reporting period. If indicators of impairment are present for a community, an undiscounted cash flow analysis is generally prepared in order to determine if the carrying value of the assets in that community exceeds the undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, fair value can be determined through other methods, such as appraisals, contractual purchase offers, and other third party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the three months ended March 31, 2022 and 2021, no impairment charges were recorded.
In certain cases, we may elect to cease development and/or marketing of an existing community if we believe the economic performance of the community would be maximized by deferring development for a period of time to allow for market conditions to improve. We refer to such communities as long-term strategic assets. The decision may be based on financial and/or operational metrics as determined by us. If we decide to cease development, we will evaluate the project for impairment and then cease future development and marketing activity until such a time when we believe that market conditions have improved and economic performance can be maximized. Our assessment of the carrying value of our long-term strategic assets typically includes subjective estimates of future performance, including the timing of when development will recommence, the type of product to be offered, and the margin to be realized. In the future, some of these inactive communities may be re-opened while others may be sold. As of March 31, 2022 and December 31, 2021, we had no inactive projects.
Land held for sale — In some locations where we act as a developer, we occasionally purchase land that includes commercially zoned parcels or areas designated for school or government use, which we typically sell to commercial developers or municipalities, as applicable. We also sell residential lots or land parcels to manage our land and lot supply on larger tracts of land. Land is considered held for sale once management intends to actively sell a parcel within the next 12 months or the parcel is under contract to sell. Land held for sale is recorded at the lower of cost or fair value less costs to sell. In determining the value of land held for sale, we consider recent offers received, prices for land in recent comparable sales transactions, and other factors. We record fair value adjustments for land held for sale within Cost of land closings on the Consolidated Statement of Operations.
Land banking arrangements — We have land purchase agreements with various land sellers. As a method of acquiring land in staged takedowns, while limiting risk and minimizing the use of funds from our available cash or other financing sources, we may transfer our right under certain specific performance agreements to entities owned by third parties (“land banking arrangements”). These entities use equity contributions from their owners and/or incur debt to finance the acquisition and development of the land. The entities grant us an option to acquire lots in staged takedowns. In consideration for this option, we make a non-refundable deposit. We are not legally obligated to purchase the balance of the lots, but would forfeit any existing deposits and could be subject to financial and other penalties if the lots were not purchased. We do not have an ownership interest in these entities or title to their assets and do not guarantee their liabilities. These land banking arrangements help us manage the financial and market risk associated with land holdings.
Investments in Consolidated and Unconsolidated Entities
Consolidated Entities — In the ordinary course of business, we enter into land purchase contracts, lot option contracts and land banking arrangements in order to procure land or lots for the construction of homes. Such contracts enable us to control significant lot positions with a minimal initial capital investment and substantially reduce the risks associated with land
ownership and development. In accordance with ASC Topic 810, Consolidation, we have concluded that when we enter into these agreements to acquire land or lots and pay a non-refundable deposit, a Variable Interest Entity (“VIE”) may be created because we are deemed to have provided subordinated financial support that will absorb some or all of an entity’s expected losses if they occur. If we are the primary beneficiary of the VIE, we will consolidate the VIE and reflect such assets and liabilities as Consolidated real estate not owned within our real estate inventory balance in the Consolidated Balance Sheets.
Unconsolidated Joint Ventures — We use the equity method of accounting for entities over which we exercise significant influence but do not have a controlling interest over the operating and financial policies of the investee. For unconsolidated entities in which we function as the managing member, we have evaluated the rights held by our joint venture partners and determined that the partners have substantive participating rights that preclude the presumption of control. Our share of net earnings or losses is included in Equity in income of unconsolidated entities when earned and distributions are credited against our investment in the joint venture when received. These joint ventures are recorded in Investments in unconsolidated entities on the Consolidated Balance Sheets.
We evaluate our investments in unconsolidated entities for indicators of impairment semi-annually. A series of operating losses of an investee or other factors may indicate that a decrease in value of our investment in the unconsolidated entity has occurred which is other-than-temporary. The amount of impairment recognized, if any, is the excess of the investment's carrying amount over its estimated fair value. Additionally, we consider various qualitative factors to determine if a decrease in the value of the investment is other-than-temporary. These factors include age of the venture, stage in its life cycle, intent and ability for us to recover our investment in the entity, financial condition and long-term prospects of the entity, short-term liquidity needs of the unconsolidated entity, trends in the general economic environment of the land, entitlement status of the land held by the unconsolidated entity, overall projected returns on investment, defaults under contracts with third parties (including bank debt), recoverability of the investment through future cash flows and relationships with the other partners. If we believe that the decline in the fair value of the investment is temporary, then no impairment is recorded. We recorded no impairment charges related to the investments in unconsolidated entities for the three months ended March 31, 2022 and 2021.
Revenue Recognition — We recognize revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”). The standard's core principle requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.
Home and land closings revenue
Under Topic 606, the following steps are applied to determine the proper home closings revenue and land closings revenue recognition: (1) we identify the contract(s) with our customer; (2) we identify the performance obligations in the contract; (3) we determine the transaction price; (4) we allocate the transaction price to the performance obligations in the contract; and (5) we recognize revenue when (or as) we satisfy the performance obligation. For our home sales transactions, we have one contract, with one performance obligation, with each customer to build and deliver the home purchased (or develop and deliver land). Based on the application of the five steps, the following summarizes the timing and manner of home and land sales revenue:
•Revenue from closings of residential real estate is recognized when closings have occurred, the buyer has made the required minimum down payment, obtained necessary financing, the risks and rewards of ownership are transferred to the buyer, and we have no continuing involvement with the property, which is generally upon the close of escrow. Revenue is reported net of any discounts and incentives.
•Revenue from land sales is recognized when a significant down payment is received, title passes and collectability of the receivable, if any, is reasonably assured, and we have no continuing involvement with the property, which is generally upon the close of escrow.
Amenity and other revenue
We own and operate certain amenities such as golf courses, club houses, and fitness centers, which require us to provide club members with access to the facilities in exchange for the payment of club dues. We collect club dues and other fees from the club members, which are invoiced on a monthly basis. Revenue from our golf club operations is also included in amenity and other revenue. Amenity and other revenue also includes revenue from the sale of assets which include multi-use properties as part of our Urban Form operations.
Financial services revenue
Mortgage operations and hedging activity related to financial services are not within the scope of Topic 606. Loan origination fees (including title fees, points, and closing costs) are recognized at the time the related real estate transactions are completed, which is usually upon the close of escrow. All of the loans TMHF originates are sold to third party investors within a short
period of time, on a non-recourse basis. Gains and losses from the sale of mortgages are recognized in accordance with ASC Topic 860-20, Sales of Financial Assets. TMHF does not have continuing involvement with the transferred assets; therefore, we derecognize the mortgage loans at time of sale, based on the difference between the selling price and carrying value of the related loans upon sale, recording a gain/loss on sale in the period of sale. Also included in Financial services revenue/expenses are realized and unrealized gains and losses from hedging instruments.
Recently Issued Accounting Pronouncements — In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients for applying U.S. GAAP to contracts affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The guidance was effective beginning March 12, 2020 and entities may elect to apply the amendments prospectively through December 31, 2022. We are currently evaluating the effect of adopting the new guidance on our consolidated financial statements and related disclosures. However, we do not believe the effect of adopting will have a material impact.
3. EARNINGS PER SHARE
Basic earnings per common share is computed by dividing net income available to TMHC by the weighted average number of shares of Common Stock outstanding during the period. Diluted earnings per share gives effect to the potential dilution that could occur if all outstanding dilutive equity awards to issue shares of Common Stock were exercised or settled.
The following is a summary of the components of basic and diluted earnings per share (in thousands, except per share amounts):
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
March 31, | | |
| | 2022 | | 2021 | | | | |
| Numerator: | | | | | | | | |
| Net income available to TMHC | | $ | 176,703 | | | $ | 98,021 | | | | | |
| Denominator: | | | | | | | | |
| Weighted average shares – basic | | 121,186 | | | 128,883 | | | | | |
| Restricted stock units | | 801 | | | 975 | | | | | |
| Stock Options | | 670 | | | 844 | | | | | |
| Warrants | | — | | | 544 | | | | | |
| Weighted average shares – diluted | | 122,657 | | | 131,246 | | | | | |
| Earnings per common share – basic: | | | | | | | | |
| Net income available to Taylor Morrison Home Corporation | | $ | 1.46 | | | $ | 0.76 | | | | | |
| Earnings per common share – diluted: | | | | | | | | |
| Net income available to Taylor Morrison Home Corporation | | $ | 1.44 | | | $ | 0.75 | | | | | |
The above calculations of weighted average shares exclude 1,045,290 and 811,658 anti-dilutive stock options and unvested restricted stock units (“RSUs”) for the three months ended March 31, 2022 and 2021, respectively.
4. REAL ESTATE INVENTORY AND LAND DEPOSITS
Inventory consists of the following (in thousands):
| | | | | | | | | | | | | | |
| | As of |
| | March 31,
2022 | | December 31, 2021 |
| Real estate developed and under development | | $ | 3,895,167 | | | $ | 3,895,681 | |
Real estate held for development or held for sale (1) | | 72,022 | | | 70,305 | |
Operating communities (2) | | 1,554,551 | | | 1,309,551 | |
| Capitalized interest | | 177,969 | | | 168,670 | |
| Total owned inventory | | 5,699,709 | | | 5,444,207 | |
| Consolidated real estate not owned | | 43,418 | | | 55,314 | |
| Total real estate inventory | | $ | 5,743,127 | | | $ | 5,499,521 | |
(1) Real estate held for development or held for sale includes properties which are not in active production. This includes raw land recently purchased or awaiting entitlement, and, if applicable, long-term strategic assets.
(2) Operating communities consist of all vertical construction costs relating to homes in progress and completed homes.
The development status of our land inventory is as follows (dollars in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | |
| | As of |
| | March 31, 2022 | | December 31, 2021 |
| | | Owned Lots | | Book Value of Land
and Development | | Owned Lots | | Book Value of Land
and Development |
| Homebuilding owned lots | | | | | | | | |
| Raw | | 3,933 | | | $ | 179,376 | | | 4,017 | | | $ | 178,952 | |
| Partially developed | | 23,237 | | | 1,572,778 | | | 24,636 | | | 1,568,967 | |
| Finished | | 19,999 | | | 2,124,655 | | | 19,360 | | | 2,119,128 | |
| | | | | | | | |
| Total homebuilding owned lots | | 47,169 | | | 3,876,809 | | | 48,013 | | | 3,867,047 | |
| Other assets | | 5,298 | | | 90,380 | | | 5,298 | | | 98,939 | |
| Total owned lots | | 52,467 | | | $ | 3,967,189 | | | 53,311 | | | $ | 3,965,986 | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| | | | | | | | |
We have land option purchase contracts, land banking arrangements and other controlled lot agreements. We do not have title to the properties, and the creditors generally only have recourse against us in the form of retaining any non-refundable deposits. We are also not legally obligated to purchase the balance of the lots. Deposits related to these lots are capitalized when paid and classified as Land deposits until the associated property is purchased. The table below presents a summary of our controlled lots for the following periods (dollars in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | As of |
| | March 31, 2022 | | December 31, 2021 |
| | Controlled Lots | | Purchase Price | | Land Deposit (1) | | Controlled Lots | | Purchase Price | | Land Deposit (1) |
| Homebuilding controlled lots | | | | | | | | | | | | |
| Land option purchase contracts | | 7,831 | | | $ | 457,796 | | | $ | 52,213 | | | 8,360 | | | $ | 507,161 | | | $ | 57,554 | |
| Land banking arrangements | | 7,117 | | | 1,000,881 | | | 136,404 | | | 5,731 | | | 749,813 | | | 117,721 | |
| Other controlled lots | | 14,766 | | | 1,303,421 | | | 49,792 | | | 14,671 | | | 1,338,284 | | | 38,505 | |
| Total controlled lots | | 29,714 | | | $ | 2,762,098 | | | $ | 238,409 | | | 28,762 | | | $ | 2,595,258 | | | $ | 213,780 | |
(1) Land deposits noted are all non-refundable and represent our exposure to loss related to our contracts with third parties, unconsolidated entities, and land banking arrangements.. In addition, at March 31, 2022 and December 31, 2021 we had refundable deposits of $22.5 million and $15.7 million respectively.
Capitalized Interest — Interest capitalized, incurred and amortized is as follows (in thousands):
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
March 31, | | |
| | | 2022 | | 2021 | | | | |
| Interest capitalized - beginning of period | | $ | 168,670 | | | $ | 163,780 | | | | | |
| Interest incurred and capitalized | | 39,729 | | | 37,719 | | | | | |
| Interest amortized to cost of home closings | | (30,430) | | | (27,325) | | | | | |
| Interest capitalized - end of period | | $ | 177,969 | | | $ | 174,174 | | | | | |
5. INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES
Unconsolidated Entities
We have investments in a number of joint ventures with third parties. These entities are generally involved in real estate development, homebuilding and/or mortgage lending activities. The real estate development joint ventures primary activity is development and sale of lots to joint venture partners and/or unrelated builders. Our share of the joint venture profit relating to lots we purchase from the joint ventures is deferred until homes are delivered by us and title passes to a homebuyer.
Summarized, unaudited combined financial information of unconsolidated entities that are accounted for by the equity method are as follows (in thousands):
| | | | | | | | | | | | | | |
| | As of |
| | March 31,
2022 | | December 31,
2021 |
| Assets: | | | | |
| Real estate inventory | | $ | 418,004 | | | $ | 414,687 | |
| Other assets | | 134,890 | | | 118,990 | |
| Total assets | | $ | 552,894 | | | $ | 533,677 | |
| Liabilities and owners’ equity: | | | | |
| Debt | | $ | 176,477 | | | $ | 167,842 | |
| Other liabilities | | 23,231 | | | 16,245 | |
| Total liabilities | | 199,708 | | | 184,087 | |
| Owners’ equity: | | | | |
| TMHC | | 173,231 | | | 171,406 | |
| Others | | 179,955 | | | 178,184 | |
| Total owners’ equity | | 353,186 | | | 349,590 | |
| Total liabilities and owners’ equity | | $ | 552,894 | | | $ | 533,677 | |
| | | | | | | | | | | | | | | | | | |
| | | Three Months Ended
March 31, | | |
| | | 2022 | | 2021 | | | | |
| Revenues | | $ | 30,401 | | | $ | 49,880 | | | | | |
| Costs and expenses | | (25,694) | | | (34,157) | | | | | |
| Income of unconsolidated entities | | $ | 4,707 | | | $ | 15,723 | | | | | |
| TMHC’s share in income of unconsolidated entities | | $ | 1,831 | | | $ | 5,661 | | | | | |
| Distributions to TMHC from unconsolidated entities | | $ | 2,058 | | | $ | 10,613 | | | | | |
Consolidated Entities
We have several joint ventures for the purpose of real estate development and homebuilding activities, which we have determined to be VIEs. As the managing member, we oversee the daily operations and have the power to direct the activities of the VIEs, or joint ventures. For this specific subset of joint ventures, based upon the allocation of income and loss per the applicable joint venture agreements and certain performance guarantees, we have potentially significant exposure to the risks
and rewards of the joint ventures. Therefore, we are the primary beneficiary of these joint venture VIEs, and these entities are consolidated.
As of March 31, 2022, the assets of the consolidated joint ventures totaled $260.0 million, of which $23.1 million was cash and cash equivalents and $79.0 million was owned inventory. As of December 31, 2021, the assets of the consolidated joint ventures totaled $291.8 million, of which $22.3 million was cash and cash equivalents and $147.6 million was owned inventory. The liabilities of the consolidated joint ventures totaled $141.2 million and $165.1 million as of March 31, 2022 and December 31, 2021, respectively, and were primarily comprised of notes payable, accounts payable and accrued liabilities.
6. ACCRUED EXPENSES AND OTHER LIABILITIES
Accrued expenses and other liabilities consist of the following (in thousands):
| | | | | | | | | | | | | | |
| | As of
March 31, 2022 | | As of
December 31, 2021 |
| Real estate development costs to complete | | $ | 46,044 | | | $ | 49,833 | |
| Compensation and employee benefits | | 78,849 | | | 166,272 | |
| Self-insurance and warranty reserves | | 140,970 | | | 141,839 | |
| Interest payable | | 39,241 | | | 48,551 | |
| Property and sales taxes payable | | 27,115 | | | 29,384 | |
| Other accruals | | 84,662 | | | 89,330 | |
| Total accrued expenses and other liabilities | | $ | 416,881 | | | $ | 525,209 | |
Self-Insurance and Warranty Reserves – We accrue for the expected costs associated with our limited warranty, deductibles and self-insured amounts under our various insurance policies within Beneva Indemnity Company (“Beneva”), a wholly owned subsidiary. A summary of the changes in our reserves are as follows (in thousands):
| | | | | | | | | | | | | | | |
| | Three Months Ended
March 31, | | |
| 2022 | | 2021 | | | | |
| Reserve - beginning of period | $ | 141,839 | | | $ | 118,116 | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Other additions to reserves | 8,884 | | | 12,391 | | | | | |
| Cost of claims incurred | (12,473) | | | (15,865) | | | | | |
| Changes in estimates to pre-existing reserves | 2,720 | | | 1,764 | | | | | |
| | | | | | | |
| Reserve - end of period | $ | 140,970 | | | $ | 116,406 | | | | | |
7. DEBT
Total debt consists of the following (in thousands):
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | As of |
| | March 31, 2022 | | December 31, 2021 |
| | Principal | | Unamortized Debt Issuance (Costs)/Premium | | Carrying Value | | Principal | | Unamortized Debt Issuance (Costs)/Premium | | Carrying Value |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
5.875% Senior Notes due 2023 | | $ | 350,000 | | | $ | (591) | | | $ | 349,409 | | | $ | 350,000 | | | $ | (733) | | | $ | 349,267 | |
| | | | | | | | | | | | |
5.625% Senior Notes due 2024 | | 350,000 | | | (1,032) | | | 348,968 | | | 350,000 | | | (1,166) | | | 348,834 | |
| | | | | | | | | | | | |
5.875% Senior Notes due 2027 | | 500,000 | | | (4,047) | | | 495,953 | | | 500,000 | | | (4,243) | | | 495,757 | |
6.625% Senior Notes due 2027 | | 300,000 | | | 16,919 | | | 316,919 | | | 300,000 | | | 17,718 | | | 317,718 | |
5.75% Senior Notes due 2028 | | 450,000 | | | (3,656) | | | 446,344 | | | 450,000 | | | (3,814) | | | 446,186 | |
5.125% Senior Notes due 2030 | | 500,000 | | | (5,282) | | | 494,718 | | | 500,000 | | | (5,440) | | | 494,560 | |
| Senior Notes subtotal | | $ | 2,450,000 | | | $ | 2,311 | | | $ | 2,452,311 | | | $ | 2,450,000 | | | $ | 2,322 | | | $ | 2,452,322 | |
| Loans payable and other borrowings | | 395,400 | | | — | | | 395,400 | | | 404,386 | | | — | | | 404,386 | |
$800 Million Revolving Credit Facility | | — | | | — | | | — | | | — | | | — | | | — | |
$100 Million Revolving Credit Facility | | — | | | — | | | — | | | 31,529 | | | — | | | 31,529 | |
| Mortgage warehouse borrowings | | 200,662 | | | — | | | 200,662 | | | 413,887 | | | — | | | 413,887 | |
| Total debt | | $ | 3,046,062 | | | $ | 2,311 | | | $ | 3,048,373 | | | $ | 3,299,802 | | | $ | 2,322 | | | $ | 3,302,124 | |
Senior Notes
All of our senior notes (the “Senior Notes”) described below and the related guarantees are senior unsecured obligations and are not subject to registration rights. The indentures governing our Senior Notes (except for the remaining 2027 6.625% WLH Notes, as described below) contain covenants that limit our ability to incur debt secured by liens and enter into certain sale and leaseback transactions and contain customary events of default. None of the indentures for the Senior Notes have financial maintenance covenants. As of March 31, 2022, we were in compliance with all of the covenants under the Senior Notes.
5.875% Senior Notes due 2023
On April 16, 2015, Taylor Morrison Communities, Inc (“TM Communities”) issued $350.0 million aggregate principal amount of 5.875% Senior Notes due 2023 (the “2023 5.875% Senior Notes”), which mature on April 15, 2023. The 2023 5.875% Senior Notes are guaranteed by Taylor Morrison Home III Corporation, Taylor Morrison Holdings, Inc. and their homebuilding subsidiaries (collectively, the “Guarantors”). We are required to offer to repurchase the 2023 5.875% Senior Notes at a price equal to 101% of their aggregate principal amount (plus accrued and unpaid interest) upon certain change of control events where there is a credit rating downgrade that occurs in connection with the change of control.
Prior to January 15, 2023, the 2023 5.875% Senior Notes are redeemable at a price equal to 100% plus a “make-whole” premium for payments through January 15, 2023 (plus accrued and unpaid interest). Beginning January 15, 2023, the 2023 5.875% Senior Notes are redeemable at par (plus accrued and unpaid interest).
5.625% Senior Notes due 2024
On March 5, 2014, TM Communities issued $350.0 million aggregate principal amount of 5.625% Senior Notes due 2024 (the “2024 Senior Notes”), which mature on March 1, 2024. The 2024 Senior Notes are guaranteed by the Guarantors. The change of control provisions in the indenture governing the 2024 Senior Notes are similar to those contained in the indentures governing our other Senior Notes.
Prior to December 1, 2023, the 2024 Senior Notes are redeemable at a price equal to 100% plus a “make-whole” premium for payments through December 1, 2023 (plus accrued and unpaid interest). Beginning on December 1, 2023, the 2024 Senior Notes are redeemable at par (plus accrued and unpaid interest).
5.875% Senior Notes due 2027
On June 5, 2019, TM Communities issued $500.0 million aggregate principal amount of 5.875% Senior Notes due 2027 (the “2027 5.875% Senior Notes”), which mature on June 15, 2027. The 2027 5.875% Senior Notes are guaranteed by the
Guarantors. The change of control provisions in the indenture governing the 2027 5.875% Senior Notes are similar to those contained in the indentures governing our other Senior Notes.
Prior to March 15, 2027, the 2027 5.875% Senior Notes are redeemable at a price equal to 100% plus a “make-whole” premium for payments through March 15, 2027 (plus accrued and unpaid interest). Beginning on March 15, 2027, the 2027 5.875% Senior Notes are redeemable at par (plus accrued and unpaid interest).
6.625% Senior Notes due 2027
Following our exchange offer in the first quarter of 2020, whereby TM Communities offered to exchange any and all outstanding senior notes issued by WLH, we had $290.4 million aggregate principal amount of