M.D.C. Holdings, Inc. reported significant financial performance changes in its Q3 2024 10-Q filing, reflecting both growth in home sales and challenges in profitability. Home sale revenues for the third quarter reached $1,386.7 million, a 28% increase from $1,087.1 million in Q3 2023. Gross profit also rose to $246.8 million from $208.2 million year-over-year. However, homebuilding pretax income remained relatively flat at $127.8 million, slightly up from $127.4 million in the prior year.
For the nine months ending September 30, 2024, home sale revenues totaled $4,123.3 million, up from $3,210.5 million in the same period of 2023. Gross profit for this period increased to $734.1 million from $560.7 million. Despite these gains, homebuilding pretax income decreased to $257.1 million from $310.4 million, attributed to rising selling, general, and administrative expenses, alongside $38.6 million in transaction costs related to the recent merger with SH Residential Holdings, LLC.
The financial services segment showed robust growth, with revenues for Q3 2024 increasing to $43.4 million from $23.8 million in Q3 2023, and pretax income rising to $27.9 million from $12.4 million. For the nine-month period, financial services revenues reached $112.3 million, up from $85.9 million, with pretax income increasing to $68.2 million from $51.4 million.
Net income for Q3 2024 was $133.5 million, a 24% increase from $107.3 million in Q3 2023. However, for the nine months, net income decreased to $254.5 million from $281.5 million in the previous year. The effective income tax rate for Q3 2024 dropped to 14.2% from 23.2% in Q3 2023, contributing to the increase in net income.
The company completed a merger on April 19, 2024, which resulted in a total consideration of approximately $4.9 billion, funded in part by $664.6 million from the company. This merger led to the delisting of the company’s common stock from the NYSE and the termination of its registration under the Exchange Act.
As of September 30, 2024, total assets decreased to $5,105.7 million from $5,631.1 million at the end of 2023, primarily due to a reduction in cash and cash equivalents following the merger. The company reported a backlog of 1,065 homes valued at $628.5 million, reflecting a 62% decrease in both the number and value of homes compared to the previous year, attributed to a shift in consumer preferences towards quicker move-in options.
Overall, while M.D.C. Holdings, Inc. experienced growth in revenues and profitability in its financial services segment, challenges in homebuilding profitability and the impact of the recent merger influenced its overall financial performance.
About M.D.C. HOLDINGS, INC.
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