Q1 2024 Century Communities Inc Earnings Call
Good day and welcome to the century communities first quarter earnings call. All participants will be in a listen only mode should you need assistance. Please signal conference specialist by pressing the star key followed by zero.
Operator: Good day, and welcome to the Century Communities First Quarter Earnings Call. All participants will be in a listen-only mode.
Operator: Should you need assistance, please signal conference specialists by pressing the star key, followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then 1 on your touch-tone phone, and to withdraw your question, please press star then 2.
After todays presentation, there will be an opportunity to ask questions to ask a question you May Press Star then one on your Touchtone phone and to withdraw your question. Please press Star then two please.
Operator: Please note, this event is being recorded. I would now like to turn the conference over to Mr. Tyler Langton. Please go ahead, sir.
Please note. This event is being recorded I would now like to turn the conference over to Mr. Tyler Lincoln. Please go ahead Sir.
Tyler J. Langton: Good afternoon. Thank you for joining us today for Century Communities' Earnings Conference Call for the first quarter of 2024. Before the call begins, I would like to remind everyone that certain statements made during this call may constitute forward-looking statements. These statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described or implied in the forward-looking statements.
Tyler J. Langton: Good afternoon.
Tyler J. Langton: Thank you for joining us today for century communities earnings conference call for first quarter 'twenty 'twenty four for the call here I would like to remind everyone that certain statements made during this call may constitute forward looking statements.
Tyler J. Langton: These statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described or implied in the forward looking statements.
Tyler J. Langton: Certain of these risks and uncertainties can be found under the heading risk factors in the company's latest 10-K as supplemented by our latest 10-Q and other SEC filings, we undertake no duty to update our forward looking statements. Additionally, certain non-GAAP financial measures will be discussed on this conference call.
Tyler J. Langton: Certain of these risks and uncertainties can be found under the heading Risk Factors in the Company's latest 10-K, as supplemented by our latest 10-Q and other SEC filings. We undertake no duty to update our forward-looking statements.
Tyler J. Langton: Additionally, certain non-GAAP financial measures will be discussed on this conference call. However, the company's presentation of its information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Hosting the call today are Dale Francescon, Chairman and Co-Chief Executive Officer; Rob Francescon, Co-Chief Executive Officer and President, and Scott Dixon, Interim Chief Financial Officer. Following today's prepared remarks, we'll open up the line for questions. With that, I'll turn the call over to Dale.
Tyler J. Langton: The company's presentation of this information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP.
Speaker Change: Hosting the call today are they offering.
Speaker Change: Chairman and co Chief Executive Officer, Rob Francesca Co Chief Executive Officer, President and Scott <unk>.
Speaker Change: From Chief Financial Officer.
Speaker Change: Following todays prepared remarks, well open up the line for questions.
Speaker Change: I'll turn the call over to Dale Thank you Tyler and good afternoon, everyone.
Dale Francescon: Thank you, Tyler, and good afternoon, everyone. To start, I want to welcome Scott Dixon, our Interim Chief Financial Officer, to the call. Scott joined Century back in 2013 and was most recently our assistant chief financial officer. Scott has played a key role in driving our growth over the past 10 plus years, and his direct responsibilities have included overseeing accounting, treasury, risk management, and financial planning and analysis. Turning to the quarter, we're very pleased with our first quarter results, including deliveries of 2,358 homes, an increase of 23% versus the prior year period and the second highest level of first quarter deliveries in our company's history.
Dale: To start I want to welcome Scott Dixon, our interim Chief financial officer to the call.
Dale: Scott joined century back in 2013.
Scott Dixon: Was most recently, our assistant Chief Financial Officer Scott.
Dale: Scott has played a key role in driving our growth over the past 10, plus years and has direct responsibilities have included overseeing accounting treasury risk management and financial planning and analysis.
Dale: Turning to the quarter, we're very pleased with our first quarter results, including deliveries of 2358 homes.
Dale: The increase of 23% versus the prior year period, and the second highest level of first quarter deliveries in our company's history.
Dale Francescon: Our first quarter revenues of $949 million increased by 26% versus the prior year period, and our adjusted diluted earnings per share of $2.22 increased by 114%. We have continued to see strong demand for affordable new homes and low resale inventories in our market. Our first quarter net new contracts of 2,866 homes increased by 42% year-over-year and by 22% versus the fourth quarter, 2023. Our orders increased on a sequential basis in each month of the first quarter, and our orders in the first three weeks of April are consistent with overall first quarter levels.
Dale: Our first quarter revenues of $949 million increased by 26% versus the prior year period.
Our adjusted diluted earnings per share of $2.22 increased by 114%.
Dale: We have continued to see strong demand for our affordable new homes and low resale inventories in our markets. Our first quarter net new contracts of 2866 homes increased by 42% year over year.
Dale: And by 22% versus the fourth quarter 2023.
Dale: Orders increased on a sequential basis in each month of the first quarter.
Dale: Our orders in the first three weeks of April are consistent with overall first quarter levels.
Dale: We also experienced a meaningful improvement in absorptions with our first quarter 'twenty 'twenty four monthly absorption rates, averaging 3.8 versus two point in the year ago period, and 3.1 in the fourth quarter of 2023.
Dale Francescon: We also experienced a meaningful improvement in absorption, with our first quarter 2024 monthly absorption rates averaging 3.8 versus 2.9 in the year-ago period and 3.1 in the fourth quarter of 2023. On a year-over-year basis, our net orders increased across all our centers, with the southeast and mountain regions posting the strongest gains at 86% and 84%, respectively. While we continue to provide incentives through rate buydowns when necessary, we are seeing buyers adjust to higher interest rates across our platform, which has enabled us to reduce our level of incentives, our focus on affordability positions as well for future growth, and Continued Success as we can target the widest range of potential homebuyers. In the first quarter, more than 90% of our deliveries were priced below FHA limits. Our average sales price of $391,000 remains among the lowest of the publicly traded homebuilders.
Dale: On a year over year basis, our net orders increased across all our segments with the south East and mountain regions, posting the strongest gains at 86% and 84% respectively.
Dale: While we continue to provide incentives through rate buy downs when necessary. We are seeing buyers suggest a higher interest rates across our platform.
Dale: Which has enabled us to reduce our level of incentives.
Our focus on affordability positions us well for future growth.
Dale: And continued success as we can target the widest range of potential homebuyers.
Dale: In the first quarter more than 90% of our deliveries were priced below FHA limits.
Dale: Our average sales price of $391000 remains among the lowest of the publicly traded homebuilders.
Dale Francescon: In the first quarter, we generally matched our starts with our sales and built nearly 100% of our homes on a spec basis. This approach allows us to control our costs, maintain an appropriate supply of quick move-in homes, provide our homebuyers with certainty of financing, and meet the healthy demand that we are seeing in our market. In closing, I want to highlight that Century was recently selected as the highest-ranked homebuilder on Newsweek's list of America's most trustworthy companies for the second year in a row.
In the first quarter, we generally matched our starts with our sales and built nearly 100% of our homes on a spec basis.
Dale: This approach allows us to control our costs.
Dale: Maintaining an appropriate supply of quick move in homes provide our homebuyers with certainty of financing.
Dale: And meet the healthy demand that we're seeing in our markets.
Dale: In closing I want to highlight that century was recently selected as the highest ranked homebuilder on Newsweek's list of America's most trustworthy companies for the second year in a row.
Dale Francescon: And we believe our inclusion on this list is a testament to the unwavering dedication of our team members and trade partners, who consistently deliver a home for every dream. Our entire company culture and work ethic is built around consistently pairing quality, affordable homes with a best-in-class home buying experience. So we're deeply honored to receive this recognition for the second year in a row. I'll now turn the call over to Rob to discuss our operations and land position in more detail. Thank you, Dale, and good afternoon, everyone.
Dale: And we believe our inclusion on this list is a testament to the unwavering dedication of our team members and trade partners, who consistently deliver a home for every train.
Our entire company culture and work ethic is built around consistently pairing quality affordable homes with a best in class home buying experience. So we're deeply honored to receive this recognition for the second year in a row.
I'll now turn the call over to Rob to discuss our operations and land position in more detail.
Robert J. Francescon: You Dale and good afternoon, everyone give.
Robert J. Francescon: Given the strong demand for our new homes, we are able to reduce our incentives on closed homes to a little over 700 basis points in the first quarter of 2024 from roughly 800 basis points in the fourth quarter of 2023. As we've discussed in the past, interest rate buy-downs continue to be the most important incentive for our customers, given their ability to significantly lower monthly payments, a key focus for our entry-level buyers.
Robert J. Francescon: Given the strong demand for our new homes, we were able to reduce our incentives on closed homes to a little over 700 basis points in the first quarter 2024 from roughly 800 basis points in the fourth quarter of 2023.
Robert J. Francescon: As we've discussed in the past interest rate buy downs continue to be the most important incentive for our customers given their ability to significantly lower monthly payments a key focus for our entry level buyer.
Robert J. Francescon: In the first quarter, the FICO scores of our homebuyers remain healthy and consistent with levels from the fourth quarter and full year 2023. We also had continued success in controlling our costs. On a sequential basis, we saw a further 2% reduction in our direct construction costs across a wide range of categories on the homes we started. We've been able to achieve these reductions, even with the continued strength in the housing market, by both leveraging and expanding our trade and supply base across our national footprint. During the first quarter, our cycle times remained in the four to five month time frame after having returned to these pre-COVID historical averages in the back half of 2023.
Robert J. Francescon: In the first quarter, the FICO scores of our homebuyers remain healthy and consistent with levels from the fourth quarter and full year 2023.
Robert J. Francescon: We also had continued success in controlling our costs in the first quarter on a sequential basis, we saw a further 2% reduction in our direct construction costs across a wide range of categories on the homes we started.
Robert J. Francescon: We've been able to achieve these reductions even with the continued strength in the housing market by both leveraging and expanding our trade and supply base across our national footprint.
Robert J. Francescon: During the first quarter our cycle times remained in the four to five months timeframe. After having returned to these pre COVID-19 historical averages in the back half of 'twenty to 'twenty three.
Robert J. Francescon: On the land front, we ended the first quarter with approximately 75000 owned and controlled lots a 46% year over year increase.
Robert J. Francescon: On the land front, we ended the first quarter with approximately 75,000 owned and controlled lots, a 46% year-over-year increase. The higher lot count on a year-over-year basis was driven by an increase in our controlled lots, which accounted for 58 percent of our total lots in the first quarter, with our number of owned lots remaining relatively static over the past two years. Additionally, at the end of the first quarter, Texas and the Southeast accounted for roughly 50% of our total lot count, up from 39% in the year-ago period and reflective of our strategy to grow our presence in these attractive markets that are benefiting from relative affordability, strong employment, and population growth.
Robert J. Francescon: The higher lot count on a year over year basis was driven by an increase in our control bots, which accounted for 58% of our total lots in the first quarter with our number of owned lots remaining relatively static over the past two years.
Robert J. Francescon: Additionally, at the end of the first quarter, Texas and the southeast accounted for roughly 50% of our total lot count up from 39% in the year ago period, and reflective of our strategy to grow our presence in these attractive markets that are benefiting from relative affordability.
Robert J. Francescon: <unk> strong employment and population growth.
Robert J. Francescon: Combined with century complete these more affordable markets comprise over 70% of our owned and controlled land supply.
Robert J. Francescon: Combined with Century Complete, these more affordable markets comprise over 70% of our owned and controlled land supply. Additionally, the strength of our relationships with third-party land developers across the Southeast, Texas, and in all of Century Complete's markets further support our land light strategy that is focused on acquiring finished lots where possible. We ended the first quarter with a community count of 253, the highest level in our company's history, and an increase of 8% versus year-ago levels, with every region we operate in experiencing growth.
Robert J. Francescon: Additionally, the strength of our relationships with third party land developers across the South East, Texas and in all of century complete spark. Its further support our land light strategy that is focused on acquiring finished lots where possible.
We ended the first quarter with a community count of 253, the highest level in our company's history, and an increase of 8% versus year ago levels with every region, we operate in experiencing growth.
Robert J. Francescon: Century Complete accounted for over 40% of our total community count in the first quarter, while the Southeast and Texas combined accounted for close to 30%. During the quarter, we opened a total of 42 communities and closed 40.
Robert J. Francescon: Century complete accounted for over 40% of our total community count in the first quarter, while the southeast and Texas combined accounted for close to 30%.
Robert J. Francescon: During the quarter, we opened a total of 42 communities and close 40, we also closed out a greater number of communities than originally planned in the first quarter due to our better than expected level of sales and deliveries.
Scott Dixon: We also closed out a greater number of communities than originally planned in the first quarter due to our better than expected level of sales and delivery. We continue to expect to see community count growth for the full year 2024, with the increases more heavily weighted towards the second half of the year as more new communities start to come online. I'll now turn the call over to Scott to discuss our financial results in more detail. Thank you, Rob.
Robert J. Francescon: We continue to expect to see community count growth for the full year 2024, with the increase is more heavily weighted towards the second half of the year as more new communities start to come online.
Robert J. Francescon: I'll now turn the call over to Scott to discuss our financial results in more detail.
Scott Dixon: Thank you Rob during the first quarter of 'twenty 'twenty four pretax income was 84 3 million and net income was $64 $3 million or $2 per diluted share.
Scott Dixon: During the first quarter of 2024, pre-tax income was $84.3 million, and net income was $64.3 million, or $2 per diluted share, a 93% year-over-year increase, adjusted net income of $71.4 million, or $2.22 per diluted share, a 114% year-over-year increase. EBITDA for the quarter was $100.3 million, and adjusted EBITDA was $109.6 million, respective increases of 83% and Revenues for the first quarter were $948.5 million, up 26% versus the prior year quarter on both higher deliveries and average sales price.
Scott Dixon: 93% year over year increase.
Scott Dixon: Adjusted net income was $71 4 million or $2.22 per diluted share a 114% year over year increase.
Scott Dixon: EBITDA for the quarter was $133 million and adjusted EBITDA was $109 6 million respective increases of 83% and 100% over a year ago levels.
Scott Dixon: Revenues for the first quarter were $948 5 million up 26% versus the prior year quarter on both higher deliveries and average sales price.
Scott Dixon: Our average sales price of $391200 in the first quarter increased by 4% on a sequential basis, mainly due to lower levels of incentives index.
Scott Dixon: Our average sales price of $391,200 in the first quarter increased by 4% on a sequential basis mainly due to lower levels of incentives in May. Century Complete accounted for 33% of first quarter deliveries versus 39% in the fourth quarter 2023. Our deliveries of 2,358 homes increased by 23% versus the prior year period. We saw growth across all our regions, with the Southeast experiencing the highest growth rate of 91% year over year as we continue to expand our presence in this attractive region.
Our century complete accounted for 33%, our first quarter deliveries versus 39% in the fourth quarter 2023.
Scott Dixon: Our deliveries of 2358 homes increased by 23% versus the prior year period.
Scott Dixon: We saw growth across all our regions with the southeast experiencing the highest growth rate of 91% year over year as we continue to expand our presence in this attractive region.
Scott Dixon: We are pleased with the strong start to the year for our deliveries and expect to see sequential growth over the remaining quarters of 2024.
Scott Dixon: We are pleased with the strong start to the year for our deliveries and expect to see sequential growth over the remaining quarters of 2020. At quarter end, our backlog of sold homes was 1,590 units, valued at $667 million, with an average price of $420,000.
Scott Dixon: At quarter end, our backlog of sold homes was 1590 units valued at 667 million with an average price of $420000.
Scott Dixon: The increase in the average sales price of our backlog at the end of the first quarter, compared to the fourth quarter of 2023, was also largely due to. While deliveries and backlog in the first quarter were more weighted towards higher price regions, we expect this trend to broadly reverse with the percentage of our deliveries by region for the full year 2024 estimated to be roughly similar to 2023. We currently expect our average sales price for the full year 2024 to range between $380,000 and $390,000.
Scott Dixon: The increase in the average sales price of our backlog at the end of the first quarter compared to fourth quarter 2023, with also largely due to mix.
Scott Dixon: While deliveries and backlog in the first quarter were more weighted towards higher priced regions. We expect this trend to broaden the reverse with the percentage of our deliveries by region for the full year 2024.
Scott Dixon: They made it to be roughly similar to 2023 problems.
Scott Dixon: We currently expect our average sales price for the full year 2024 to range between $380000 and $390000.
Scott Dixon: In the first quarter, adjusted home building gross margin percentage was 22.8%, compared to 19.6% in the first quarter of 2020; home building gross margin was 21.3% compared to 18.2% in the prior year. Our growth margins in the first quarter were roughly flat on a sequential basis. While margins benefited from lower incentives, this sequential tailwind was generally offset by mix and purchased by the county adjustments from our acquisition of landmark homes in Tennessee that we completed in January. SG&A's percentage of home sales revenue was 12.4% in the first quarter compared to 13.4% in the prior year.
Scott Dixon: In the first quarter adjusted homebuilding gross margin percentage was 22, 8% compared to 19, 6% in the first quarter 2023.
Scott Dixon: Homebuilding gross margin was 21, 3% compared to 18, 2% in the prior year quarter.
Scott Dixon: Our gross margins in the first quarter were roughly flat on a sequential basis.
Scott Dixon: While margins benefited from lower incentives, they're sequential tailwind was generally offset by mix and purchase price accounting adjustments from our acquisition of landmark homes of Tennessee that we completed in January.
Scott Dixon: SG&A as a percentage of home sales revenue was 12, 4% in the first quarter compared to 13, 4% in the prior year.
Scott Dixon: The largest drivers of this year-over-year decrease were higher levels of deliveries and a focus on controlling our fixed levels of GNA. For 2024, we expect SG&A as a percentage of home sales revenue to decline on a year-over-year basis as we look to grow our deliveries and keep our fixed levels of GMA relatively constant. Other expense in the quarter was $9.6 million, which included a $7.7 million impairment on other non-core investments.
Scott Dixon: The largest drivers of this year over year decrease are higher levels of deliveries.
Scott Dixon: On controlling our fixed levels of G&A for.
Scott Dixon: For 2024, we expect SG&A as a percentage of home sales revenue.
Scott Dixon: The decline on a year over year basis, as we look to grow our deliveries and keep our fixed levels of G&A relatively constant.
Scott Dixon: Other expense in the quarter was $9 6 million, which included a $7 7 million impairment on other noncore investments.
Scott Dixon: In the first quarter, our tax rate was 23.7% compared to 24.3% in the prior year quarter; we expect our full year tax rate for 2024 to be roughly 25%. Our net home building debt to net capital ratio was 24.9% compared to fourth quarter 2023 levels of 22.4%. The change is driven by increased starts heading into the spring sowing season. Our home building debt to capital ratio decreased to 29.4% at quarter end compared to 29.9% as of the end of the fourth quarter 2020.
Scott Dixon: In the first quarter, our tax rate was 23, 7% compared to 24, 3% in the prior year quarter.
Scott Dixon: We expect our full year tax rate for 2024 to be roughly 25%.
Scott Dixon: Our net homebuilding debt to net capital ratio was 24, 9% compared to fourth quarter 2023 levels of 22, 4%.
Scott Dixon: The change was driven by increased starts heading into the spring selling season.
Scott Dixon: Our homebuilding debt to capital ratio decreased to 29, 4% at quarter end compared to 29, 9%. That's at the end of the fourth quarter 2023.
Scott Dixon: During the quarter, we increased our quarterly cash dividend by 13% to 26 cents per share repurchased 186887 shares of our common stock for $16 1 million and grew our book value per share to a record $76.10 a.
Scott Dixon: During the quarter, we increased our quarterly cash dividend by 13% to $0.26 per share, repurchased 186,887 shares of our common stock for $16.1 million, and grew our book value per share to a record $76.10, a 12% year-over-year increase. We ended the quarter with $2.4 billion in stockholders' equity, $1 billion in total liquidity, and $208 million in cash. At March 31st, we had no borrowings outstanding on our $800 million unsecured revolving credit facility that does not mature until April 2026.
Scott Dixon: 12% year over year increase.
Scott Dixon: We ended the quarter with $2 4 billion in stockholders' equity 1 billion and total liquidity and $208 million in cash.
Scott Dixon: At March 31, we had no borrowings outstanding on our 800 million unsecured revolving credit facility does not mature until April 2026.
Scott Dixon: Additionally, we have no senior debt maturities until June of 2027, providing us with ample flexibility with our leverage management. Now, turning to Gates. Even with our positive outlook on the housing market and our business, we are maintaining our guidance for full year 2024 deliveries to be in the range of 10,000 to 11,000 homes and our home sales revenue to be in the range of $3.8 to $4.2 billion, given the uncertainty that exists around New. In closing, we are encouraged by our strong start to the year, we are seeing solid demand across our footprint, are successfully managing our costs and cycle times, and will grow both our community count Operator.
Scott Dixon: Additionally, we have no senior debt maturities until June of 2027, providing us ample flexibility or beverage manager.
Speaker Change: Now turning to guidance.
Speaker Change: Even with our positive outlook on the housing market and our business. We are maintaining our guidance for full year 2024 deliveries to be in the range of 10000 to 11000 homes and our home sales revenue to be in the range of three eight to $4 $2 billion, given the uncertainty that exists around interest.
Speaker Change: Yes.
Speaker Change: In closing we are encouraged with our strong start to the year. We are seeing solid demand across our footprint are successfully managing our costs and cycle times, and we will grow both our community count and deliveries on a year over year basis.
Speaker Change: With that I'll open the line for questions operator.
Speaker Change: Thank you we will now begin the question and answer session to ask a question you May Press Star then one on your Touchtone phone if youre using a speakerphone. Please pick up your handset before pressing the keys. If anytime. Your question has been addressed and you would like to withdraw your question. Please press Star then two.
Operator: Thank you. We will now begin the question and answer session. (Inaudible) Express Star.
Operator: We will now pause momentarily to assemble our rock. And the first question will come from Carl Reichardt with BTIG, please go ahead. Thanks, afternoon, everybody. Hey, guys, I'm a little confused about the guide.
Speaker Change: Moving now pause momentarily to assemble our roster.
And the first question will come from Karl Reinhardt with BTG. Please go ahead.
Carl Edwin Reichardt: Thanks, Good afternoon everybody.
Carl Edwin Reichardt: Yeah.
Carl Edwin Reichardt: Carl.
Carl Edwin Reichardt: I'm a little confused on the guide I mean, if you grow deliveries just a little sequentially youre at the bottom end of the guide by the end of the year. So.
Carl Edwin Reichardt: I mean, if you grow deliveries just a little sequentially, you're at the bottom end of the guide by the end of the year. So, and you've got business in April already trending, it sounds like fairly well, and clearly your backlog conversion rate's extremely high. So help me understand again why you're not raising at least the low end of the guide unless you're expecting, I don't know, catastrophic interest rates but certainly, you know, much higher from here.
Carl Edwin Reichardt: And you've got business in April already trending it sounds like fairly well.
Carl Edwin Reichardt: And clearly your backlog conversion rates are extremely high so help me understand again why not.
Carl Edwin Reichardt: Not raising at least the low end of the guide.
Carl Edwin Reichardt: Unless youre expecting I don't get catastrophic interest rates, but certainly go much higher from here right.
Carl Edwin Reichardt: You know, Carl, it's strictly a function of trying to be conservative, not knowing where rates are going to go. You know, as we started out the year, we expected to see significant rate cuts during the year. Now that seems to be somewhat in question. So, you know, when we just look at the future, I mean, what we're seeing right now is pretty positive.
Carl Edwin Reichardt: Carl it's it's strictly a function of trying to be conservative not knowing where rates are going to go.
Carl Edwin Reichardt: We started out the year, we expected to see significant rate cuts during the year.
Carl Edwin Reichardt: Now that seems to be somewhat in question. So you know when we just look at the future. It would be what we're seeing right. Now is is pretty positive, but it's hard to anticipate what's going to happen as the year unfolds and so that's the reason for not changing guidance.
Carl Edwin Reichardt: But it's hard to anticipate what's going to happen as the year unfolds, and so that's the reason for not changing guidance. I certainly understand the uncertainty. You've added a lot of developed lots and kept your own lot count fairly flat year over year. And you mentioned, I think, that your relationships with third-party developers are key to you. So, two questions.
Carl Edwin Reichardt: Okay.
Speaker Change: I certainly understand the uncertainty.
Speaker Change: You've added a lot of developed lots and kept your owned lot count fairly flat year over year, and you mentioned I think that your your relationships with third party developers are our key to you. So two questions on the lots you are putting under contract today.
Carl Edwin Reichardt: On the lots you're putting under contract today, when do you anticipate that they will be ready to be built on coming to market on average? And then second... Of your option lots, what percentage are with third-party developers versus lots that you are going to develop yourself and bring to market later, potentially at higher prices?
Speaker Change: When do you anticipate that they will be ready to be built on coming to market on average and then second.
Speaker Change: Of your option lots, what percentage or with third party developers versus lots that you were going to develop yourself and bring to market later potentially at higher margins.
Speaker Change: So on the first part lots that we're putting in the control position.
Carl Edwin Reichardt: So, you know, on the first part, lots that we're putting in the control position and bringing on. Those range everywhere from finished lots that could be even accretive to this year's business to, you know, full development deals where we have a third-party developer who has to develop those lots for us on various structures. So, you know, they just range across the board, if you can imagine.
Speaker Change: And bringing them on.
Speaker Change: Those range everywhere from finished lots that could be even accretive to this year's business to full development deals, where we have a third party developer or if they have to develop those lots for us on various structures. So they just range across the board. If you can imagine obviously, though are.
Robert J. Francescon: Obviously, though, our desire is to have more finished lots. As a reminder, the Century Complete model only buys finished lots. And on the Communities brand, we're trying to buy finished lots everywhere that we can and create that more capital efficient landline approach. The second part of that question, your second question, regarding the percentage that are third-party developers, that's not something that we have disclosed previously. But we do develop under the Communities brand in all of our markets ourselves, in addition to third party developers that develop for us.
Speaker Change: Desire is to have more finished lots as a reminder, the century complete model only buys finished lots and on the communities brand. You'll we're trying to buy finished lots everywhere that we can and create that more capital efficient land light approach. The second part of that question or your second question regarding.
Speaker Change: The percentage that are third party developers, that's not something that we have disclosed previously.
Speaker Change: But we do develop in the communities brand and all of our markets ourselves. In addition to third party developers that develop for us. So on the century complete brand that would be 100% third party developers developing those fish slots on the communities brand, we develop along with third party developers.
Robert J. Francescon: So on the Century Complete brand, that would be 100% third party developers developing those finished lots. On the Communities brand, we develop along with third party developers. I appreciate it. I'll get back in queue.
Speaker Change: Perfect I appreciate I'll get back in queue. Thanks, a bunch guys right.
Alexander John Rygiel: Thanks a bunch, guys. The next question will come from Alex Rygiel with B Riley. Please go ahead.
Speaker Change: The next question will come from Alex Rygiel with B Riley. Please go ahead.
Alexander John Rygiel: Thank you gentlemen, and a very nice quarter again.
Alexander John Rygiel: Thank you, gentlemen, and another very nice quarter again. Thank you, Alex. As you look into the second quarter, does it appear that incentives could again decline sequentially? Yeah, you know, Alex, very good question.
Alexander John Rygiel: Thanks, Alex.
Alexander John Rygiel: As you look into the second quarter.
Alexander John Rygiel: Does it appear that incentives could again declined sequentially.
Yeah.
Alex very good question I think you know I think we are optimistic as we got into the first quarter in terms of the rate environment that as.
Robert J. Francescon: I think that, you know, we were optimistic as we got into the first quarter in terms of the rate environment and, as we said in our prepared remarks, that we had a little bit of additional pricing power on the incentive line item. Certainly, with some of the volatility and rates over the last few weeks, I don't know that there's significant additional optimism on our standpoint in terms of being able to reduce the amount of mortgage incentives that we're looking at into Q2. Certainly, the rest of the year plays itself out as something that we'll be evaluating, that is helpful, and then.
Speaker Change: As he said in our prepared remarks that we had a little bit of additional pricing power on the incentive line item.
Speaker Change: Certainly with with some of the volatility volatility in rates over the last.
Speaker Change: A few weeks.
Speaker Change: Don't know that there is.
Speaker Change: Significant additional.
Speaker Change: Optimist on optimism on our stand point in terms of being able to reduce the amount of mortgage incentives that we're looking at into Q2.
Speaker Change: Certainly if it did the rest of the year plays itself out it's something that we'll be evaluating.
Speaker Change: That is helpful.
Speaker Change: <unk>.
Speaker Change: As we think about your gross margins for the remainder of the year can you can you talk about the sort of tailwind and headwind.
Robert J. Francescon: As we think about your gross margins for the remainder of the year, can you talk about the sort of tailwinds and headwinds and maybe provide some directional guidance as it relates to sort of everything else on the agenda? Absolutely. I think, you know, when you saw the first quarter come through with margins and kind of that low gap gross margin in that low 21% range, as we're looking out in terms of our cost structure, we're not seeing significant cost pressures over the immediate future.
Speaker Change: Maybe provide some directional guidance.
Speaker Change: As it relates to sort of everything else.
Yeah, absolutely I think.
Speaker Change: When you saw the first quarter come through.
Speaker Change: With margins in kind of that low GAAP gross margins in that low 21% range as.
Speaker Change: As we're looking out in terms of ours in terms of our cost structure, we're not seeing a significant cost pressures over the immediate future.
Robert J. Francescon: So, that kind of guide from an initial first quarter perspective from a margin standpoint feels about right for the immediate future. Certainly, there can be some tailwinds or headwinds from a mortgage incentive standpoint going into the future for us here as it impacts ASPs. The other item that we would call out is that we do have a little bit of a drag from some purchase accounting related to our landmark acquisition that we completed here in January.
Speaker Change: So that that kind of guide from it some of the initial first quarter perspective from a margin it.
It feels about right for the immediate future.
Speaker Change: Certainly there can be some tailwind sort of headwinds from a mortgage incentive.
Speaker Change: Standpoint going into the future on us here.
Here is the impact Asps are the other item that we would call out is we do have a little bit of a drag from some purchase accounting related to our landmark.
Acquisition that we completed here in January it was about a 20 basis point drag here on the first quarter margins, we would anticipate that to be pretty similar for Q2 as well as Q3 within it falling off really by the back half and in final quarter of the year.
Robert J. Francescon: There's about a 20 basis point drag here on the first quarter margins. We would anticipate that to be pretty similar for Q2, as well as Q3. But within it, it's falling off really by the back half and final quarter of the year. Very helpful. Thank you very much.
Speaker Change: Very helpful. Thank you very much.
Jesse Lederman: Absolutely. The next question will come from Jesse Lederman with Zellman & Associates; please go ahead. Hi, thanks for taking my questions and congrats on the strong quarter. The first one's on backlog conversion.
Speaker Change: Absolutely. Thank you.
Speaker Change: Next question will come from Jesse Lederman with Zelman <unk> Associates. Please go ahead.
Jesse Lederman: Alright, thanks for taking my questions and congrats on the strong quarter.
Jesse Lederman: First one's on backlog conversion, so given the high backlog conversion.
Jesse Lederman: So, given the high backlog conversion, you presumably sell and deliver a high percentage of your homes in the same quarter. That said, your percentage of century complete deliveries fell sequentially to 33% from 39%. So, the question is, is that just timing, or is that somewhat of a testament to demand for that century complete home or maybe qualification issues, affordability issues, etc. Yeah, thanks for the question, Jesse. And it's a good question.
Jesse Lederman: You, presumably sell and deliver a high percentage of your homes in the same quarter that said your percentage of century complete deliveries fell sequentially to 33% from 39%. So the question is is that just timing or is that somewhat of a testament to demand for that century complete home or maybe qualification.
Jesse Lederman: She was affordability issues et cetera.
Speaker Change: Yeah. Thanks for the question Jessie and it's a good question. It's something we spent a fair amount of time as a management team looking at.
Scott Dixon: It's something we spent, you know, a fair amount of time as a management team looking at as our quarter really played itself out. So I think, and we mentioned it a little bit in our prepared remarks, we were a little bit lighter on the century complete deliveries as a percentage of our overall platform this quarter. We anticipate that to trend a little bit more towards where we were at from all of last year from a 2023 perspective, just from a percentage of the mix. And then from the backlog conversion, it was a pretty high backlog conversion that we've done historically.
Speaker Change: You know as our as the quarter really played itself through so I think we mentioned it a little bit in our prepared remarks.
A little bit lighter on the century complete deliveries as a percentage of our overall platform this quarter.
Speaker Change: We anticipate that the trend a little bit more towards.
Speaker Change: Where we're at from all of last year from a 2023 perspective.
Speaker Change: Just from a percentage of the mix.
Speaker Change: And then from the backlog conversion yesterday, it was a pretty high backlog conversion that we've done historically, we did sell and close intra quarter over 50% of our units.
Scott Dixon: We did sell and close on intra-quarter over 50% of our units. A lot of that was obviously a factor of the demand that we experienced ourselves within our markets this quarter, as well as coming into the year with units that were further along in the stage of construction. That's helpful, but just one quick follow-up on that, so you didn't see any, you know, pause in the percentage of deliveries in the quarter, or maybe even if you could talk about the percentage of homes you sold in the quarter, relative to the rest of the business. Those are maybe more affordability-constrained prospective homebuyers.
Speaker Change: A lot of that was obviously a factor of the demand.
Speaker Change: That we experienced ourselves within our markets this quarter as well as as well as you know coming into the year with with units that were further along in the stage of construction.
Speaker Change: That's helpful.
Speaker Change: Just one quick follow up on that.
Speaker Change: You didn't see any oh.
Speaker Change: Particular, affordability concerns or pushback from that century complete buyer that.
Speaker Change: The percentage of deliveries in the quarter or maybe even if you could talk about the percentage of homes you sold in the quarter.
Speaker Change: You know relative to the rest of the business those are maybe more affordability constrained prospective homebuyers.
Jesse Lederman: No, I mean, when you look at our Century Complete being able to bring homes to market in the, you know, the mid to, you know, below the $300,000 range, I think our ASPs in that brand are in the $260,000, $275,000 range. From a sales perspective, we were up 35% quarter over quarter on the Century Complete side, and while that buyer is certainly one that needs some additional incentives on the mortgage side from time to time, we're still seeing strong demand. Great Thanks for the call.
Homebuyers.
Speaker Change: No I mean, I think I think when you look at our century complete being able to bring.
Speaker Change: Homes to market.
Speaker Change: The mid that.
Speaker Change: Below 300000 range in our Asps and in that brand during the 262, 75%.
Speaker Change: Our 275, K range, where from a sales perspective, we were up 35%.
Speaker Change: Quarter over quarter on the century complete side and while that buyers certainly.
Speaker Change: One that they need some additional incentives on the mortgage side from time to time, where we're still seeing strong demand.
Speaker Change: Great. Thanks for the color and one last question.
Jesse Lederman: One last question. You've done a great job acquiring lots over the last several quarters, mostly off balance sheet with your lot count up 45% year over year. So turning just to capital allocation priorities, where do share buybacks fit on that capital allocation priority list?
Speaker Change: You've done a great job of acquiring lots over the last several quarters as you know most of the off balance sheet with your lot count up 45% year over year. So turning just to just capital allocation priorities, where does share buybacks fit on that capital allocation priority list I noticed you bought back about $16 million of shares in the first quarter.
Scott Dixon: I noticed you bought back about $16 million of shares in the first quarter, which was, you know, among your highest in a couple of years, along with the third quarter of last year. So maybe you can talk about the share buybacks a little bit. Thank you. Yeah, absolutely. And you know, larger from a kind of question from just a capital allocation perspective, and our number one priority is, is, obviously putting our capital back into the business.
Speaker Change: Which was you know among your highest in a couple of years along with the first quarter of last year. So maybe you can talk about the share buybacks a little bit. Thank you.
Yeah, absolutely and larger from a kind of question from just a capital allocation perspective in our number one priority as it is is obviously, putting our capital back into the business as you've seen has grown our our owned and controlled lot positions, where we're pretty optimistic about the markets that we're currently in.
Scott Dixon: As you've seen us grow our owned and controlled bought positions, we're pretty optimistic about the markets that we're currently in and think that, quite frankly, is the best return for our shareholders. Other than that, we certainly have a quarterly dividend of 26 cents a share, that's up 13% from the previous quarter. So that plays itself into our capital allocations. And then, from a buyback perspective, we have over a million shares still authorized under our board program. It is something you obviously saw us do during the quarter.
Speaker Change: That quite frankly is the best return from our shareholders.
Speaker Change: Other than that we certainly have a dividend quarterly.
Speaker Change: Quarterly dividend at <unk> 26 cents, a share that's up 13%.
From the previous quarter, so that plays itself into our capital allocations and then from a buyback perspective.
Speaker Change: We have over a million shares still authorized underneath our board program.
Speaker Change: It is something obviously you saw us do that.
During the quarter I think to the extent that we see dislocation within the market compared to our our book price.
Scott Dixon: I think to the extent that we see dislocation within the market, compared to our book price, it's something that we will, we will take a look at. But there is no specific guidance or structured program on the buybacks currently. Great, thanks so much. Absolutely. The next question will come from Jay McCanless with Wedbush, please go ahead. Hey, thanks for taking my questions. I guess the first one I had was, did you talk about what percentage of your closings in the first quarter were customers that used a mortgage rate buy-down? Yeah, Jay, that's not a specific number that we've disclosed in the past, but it's a substantial majority. It's over 75%. And then,
Speaker Change: It's something that we will we will take a look at.
Speaker Change: But no specific guidance or or structured program on the buybacks currently.
Speaker Change: Great. Thanks, so much.
Speaker Change: Absolutely.
Speaker Change: The next question will come from Jay Mccanless with Wedbush. Please go ahead.
Jay McCanless: Hey, Thanks for taking my questions I guess, the first one I had could you talk about what percentage of your closings in the first quarter, our customers that use the mortgage rate buy down.
Jay McCanless: Yeah.
Jay McCanless: That's that's not a specific number that we've disclosed in the past, but it's a substantial majority it's over 75%.
Jay McCanless: Okay.
Jay McCanless: And then.
Jay McCanless: We've heard from a lot of your competitors. They're seeing rising lot costs and also rising land development costs. I guess maybe you could talk to us about how that's going to play out this year for Century and whether that's going to be a 24 thing or going to be more of a 25 thing when you think those higher land costs might start to impact the income statement. I think it would be more of a 25.
Jay McCanless: We've heard from a lot of your competitors that they're seeing rising lot costs are also rising land development costs I guess, maybe could you talk to us about how how that's going to play out this year for century, and whether that's going to be at a 24 thing are going to be more of a 'twenty five thing when you think those higher land cost might start.
Jay McCanless: Impact the income statement.
Speaker Change: Yes, I think it would be more of a 'twenty five.
Jay McCanless: I think we're going to be relatively flat this year on that. From an LD standpoint, that's market dependent. We're actually getting some reductions in certain markets as people get a little bit hungrier for business with some competitor multifamily type projects that don't have the starts. So when you look at that, we are getting a little bit of a benefit in certain markets. It's a challenge.
Jay McCanless: I think we're going to be relatively flat this year on that.
Jay McCanless: From an L. D standpoint, that's market dependent we're actually getting some reductions in certain markets as people get a little bit hungrier for business with some competitor multifamily type projects that don't have the starts. So when you look at that we are getting a little bit of benefit in certain markets other mark.
Jay McCanless: It's a challenge and so overall on a consolidated basis, it's probably flat to slightly up on the <unk> side, but again its market dependent on overall land is competitive right now it seems like everybody's wanting to go after a planned and so with that we've been very competitive for us.
Jay McCanless: And so overall, on a consolidated basis, it's probably flat to slightly up on the LD side. But again, it's market dependent. But overall, land is competitive right now. It seems like everybody's wanting to go after land.
Jay McCanless: And so with that, we've been very competitive for it. So we kind of started that a little bit early as you see our year-over-year growth compared to some of our competitors. So that feels good that we have that type of a control position now going into 2024.
Jay McCanless: So we kind of started that a little bit early as you see our year over year growth than some of our competitors. So that feels good that we have that type of a control position now going into 'twenty four.
Jay McCanless: Okay, Great and then talking about the gross margin could we.
Jay McCanless: And then, talking about the gross margin, could we... Scott, if we could zero in a little bit more? Should we expect, you know, once you factor in the purchase price accounting, that 2Q gross margin is going to be fairly similar to 1Q, or is there anything in there from an incentive or delivery perspective that we need to be thinking about?
Speaker Change: Scott, if we could zero down a little bit more.
Scott Dixon: Or should we expect you know once you factor in the purchase price accounting, but to keep gross margins can be fairly similar to <unk> or is there anything in there from an incentive or delivery perspective that we need to be thinking about.
Scott Dixon: I mean, Jack I'd say, that's a reasonable expectation outside of outside of obviously, what happens from an interest rate.
Scott Dixon: I mean, Jay, I'd say that's a reasonable expectation outside of obviously what happens from an interest rate standpoint on what we're able to do or need to do from a mortgage incentive standpoint, but from where we sit today, I think that's a reasonable expectation. Okay, great. That's all I have.
Scott Dixon: What we what.
Speaker Change: And what we're able to do or need to do from a mortgage incentive standpoint.
Jack: But from where we sit today I think thats a reasonable expectation.
Speaker Change: Okay, Great. That's all I had thank you.
Jay McCanless: Thank you. The next question will come from Michael Rehart with J.P. Morgan. Please go ahead. Hi, guys. Andrew Azzio for Mike.
Speaker Change: Thank you.
Speaker Change: Next question will come from Michael Rehaut with J P. Morgan. Please go ahead.
Michael Rehaut: Hi, guys, Andrew <unk> on for Mike. Thank you for taking my question Congrats.
Andrew Azzi: Thank you for taking my question. Congratulations on the quarter. It looks like average order prices ticked up nicely sequentially. I just wanted to maybe dial in on how widespread that is and your outlook on the ability to push prices in this environment. Thanks. A lot of that would have been driven just by the mix, as, you know, as we mentioned earlier, just because of circumstances in terms of production units, the percentage of our Century Complete business, which carries the lowest ASP, was down below where we've normally been. As a result, that brought down the number of homes that we closed that had the lower Century Complete ASP. The higher ASP in the Century Communities had a bigger percentage.
Michael Rehaut: Congrats on the quarter.
Michael Rehaut: It looks like average order.
Speaker Change: Thank you.
Michael Rehaut: It looks like average order prices picked up nicely sequentially I just wanted to maybe dial in on how widespread that is in your outlook on the ability to push price in this environment. Thanks.
Speaker Change: A lot of that.
Speaker Change: Would have been driven just by the mix.
Speaker Change: As we mentioned earlier.
Speaker Change: Just because of circumstances in terms of production units the percentage of our century complete business, which carries the lowest ASP.
Speaker Change: It was down below where we'd normally been.
Speaker Change: As a result that brought.
Speaker Change: You brought down the number of homes that we closed that had the lower century complete ASB.
Speaker Change: The higher Asps with century communities had a bigger percentage as a result that that affected our overall average sales price.
Robert J. Francescon: As a result, that affected our overall average sales price. Got it. I appreciate that explanation. And then, just secondly, I was hoping if I could get any more granularity on community count growth as we go through this year and maybe any initial thoughts as we move into next year. Yeah, absolutely. I think we said in our prepared remarks, which is pretty consistent with what we said last quarter, that we anticipate, you know, really strong community count growth throughout the year, but really being back half-weighted as we've been, you know, adding to our own and control pipeline.
Got it I appreciate that explanation and then just secondly, I was hoping if I can get any more granularity on community count growth as we go across this year and maybe any initial thoughts as we move into next year.
Speaker Change: Okay.
Speaker Change: Yes, absolutely you know I think we said in our prepared remarks.
Speaker Change: Which is pretty consistent what we said last quarter as we anticipate.
Speaker Change: You know really community count growth throughout the year, but really being back half weighted as we've been adding to our own controlled pipeline.
Robert J. Francescon: I think it's when we sit here and look at it today. We obviously opened up 42 new communities during the first quarter, which was something that we were excited about. But closed out, quite frankly, a little bit fewer than we thought, which was a good thing given the market demand. But from our current kind of look at the pipeline, we really think we'll be up mid to high single digits on community count as compared to last year by the time we get to the end of this year.
Speaker Change: I think that's when we sit here.
Speaker Change: And look at it.
Speaker Change: Today, we have really opened up 42, new communities during the first quarter, which was something that we are excited about.
Speaker Change: Closeout quite frankly got a little bit a little bit fewer than we thought which was a good thing given the market demand.
Speaker Change: But from our our current kind of look at the pipeline, we really think will be up mid to high single digits.
Speaker Change: On community.
Speaker Change: As compared to last year by the time, we get to the end of this year.
Robert J. Francescon: Thanks so much. That's all for me. Good luck. Thank you. The next question is a follow-up from Carl Reichardt with VTIG, please go ahead. Hey, thanks guys for all the helpful colors; I really appreciate it.
Speaker Change: Thanks, So much that's all for me good luck.
Speaker Change: Thank you.
Speaker Change: The next question is a follow up from Karl Reinhardt with V. T. I D. Please go ahead.
Carl Edwin Reichardt: Hey, Thanks, guys for all the helpful color really appreciate it.
Carl Edwin Reichardt: Just on Century Complete and the mixed shift a bit away from it this quarter, as you're looking out in 2024 and 2025, do you expect the Century Complete mixed percentage of communities to begin to increase again, or should we expect it to be flat from here or fall as a percentage of the overall? We've been, if you look at the past few quarters, Century Complete has been 38-39% of our overall closings.
Carl Edwin Reichardt: Just on century complete and the mix shift a bit away from it this quarter as youre looking out in 'twenty four 'twenty five do you expect the essentially complete mix as a percentage of communities to begin to increase again or should we expect it to be flat from here or fall as a percentage of the overall.
No look I mean, we've been if you look at the past few quarter century complete has been.
Carl Edwin Reichardt: 38, 39% of our overall closings.
Carl Edwin Reichardt: I would expect that we get back to those same levels. It was just, when we looked at it, the homes that we had on our Century Complete brand were just less this quarter than what we had on our Communities brand. Okay, so more of an anomaly.
I would expect that we get back to those same levels. It was just when we look at it.
Carl Edwin Reichardt: The homes that we had in our century complete brand. We're just less this quarter than what we had on our communities brand.
Speaker Change: Okay. So more of an anomaly okay. Great. Thanks, and then last one can you just talk a little bit about that.
Scott Dixon: Okay, great. Thanks. And then, last one, can you just talk a little bit about the non-core investment you impaired? What was it, and why did you impaired it?
Speaker Change: The noncore investments you impaired what what was it and why did you impair it.
Speaker Change: Yes, sure absolutely with a an investment we had in the startup company.
Scott Dixon: Yeah, sure, absolutely. It's an investment we made in a startup company called Diamond Age, which is a 3D printing company. And we went through an exercise from the accounting perspective every quarter of taking a look at updated data points in that flush itself through and the charge this quarter. I appreciate it, Scott. Thanks very much, guys. Absolutely. Again, if you have a question, please press star, then 1. Our next question will come from Alex Barron with the Housing Research Center.
Speaker Change: Called Diamond age, which is a three D printing company.
And.
Speaker Change: We went through an exercise from accounting perspective every quarter of taking a look at updated data points.
Speaker Change: And that flush itself through in the charge this quarter.
Speaker Change: Okay, Great I appreciate it is got it thanks very much guys.
Thank you. Thank you.
Speaker Change: Again, if you have a question. Please press Star then one our next question will come from Alex Barron with housing Research Center. Please go ahead.
Scott Dixon: Please go ahead. Hey guys, congratulations on the quarter. I wanted to ask about incentives. I'm assuming a lot of buyers are using some form of rate buy-down or forward commitment. But I was curious if you guys could spell out what percentage of the buyers actually take advantage of something like that. Yeah, absolutely, Alex. You know, obviously, from our buyer pool, from really focusing on that first time home buyer, the substantial majority, it's above 75% of our buyers will take advantage of some level of a mortgage incentive.
Speaker Change: Yeah.
Alex Barron: Hey, guys congratulations on the quarter.
Alex Barron: I wanted to ask about them.
Alex Barron: I wanted to ask about incentives.
Alex Barron: I'm assuming.
Alex Barron: A lot of buyers are.
Alex Barron: We are using some form of rate buy down or for at the moment, but I was curious if you guys could spell out you know what percentage of the buyers actually take advantage of something like that.
Speaker Change: Yeah, absolutely Alex.
Speaker Change: Obviously from our from our buyer pool from from really focusing on that first time homebuyer. It's the substantial majority it's above 75% of our buyers who will take advantage of.
Speaker Change: On some level of a mortgage incentive.
Speaker Change: Got it and as you you know as we look at what's happened. So far this month rates up I don't know 40, or 50 bps versus last quarter.
Alex Barron: Got it. And as you know, as we look at what's happened so far this month, rates up, I don't know, 40, 50 beats versus last quarter. Is your sense that you guys will increase the incentive to kind of keep the sales pace momentum going, or that the rate you offer people will go up, you know, along with market rates? The rate that we've been offering has trended up as we've seen rates go up, so we're basically keeping a similar spread between the market and the rates that we're offering. And so far, you haven't noticed whether it's affected the sales pace much? So far, we don't, it has not, you know, obviously, affected the month.
Speaker Change: Is your sense that you guys will increase the incentive to kind of keep the sales pace momentum going or that.
Speaker Change: You offer people will go up you know along with market rates.
The rate that we've been offering has has trended up as.
Speaker Change: As we have seen rates go up so that we're basically keeping a similar spread between market and the rates that we're offering.
Speaker Change: And so far you haven't noticed whether it's effective sales pace much.
Speaker Change: Yes, so far we don't see that it has not.
Speaker Change: Obviously the month as well.
Alex Barron: Not over yet, but right now it has. Okay, that's great. All right, that's all I have. Thank you. Thank you. This concludes our question and answer session. I would like to turn the conference back over to Mr. Dale Francescon for any closing remarks. Please go ahead.
Speaker Change: Not over yet, but right now it has not.
Speaker Change: Okay. That's great Alright, that's all I got thank you.
Speaker Change: Thank you.
Speaker Change: Yeah.
Speaker Change: Yeah.
This concludes our question and answer session I would like to turn the conference back over to Mr. Dale France, asking for any closing remarks. Please go ahead.
Dale Francescon: Thank you, operator. And to our team members, thank you for your hard work, dedication to the century, and commitment to our valued homebuyers. To our investors and everyone else on the call today, we appreciate your continued support and look forward to speaking with you again next quarter and sharing our continued progress. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. Copyright 2020, New Thinking Allowed Foundation, The Ultimate Parody Site! BF-WATCH TV 2021
Dale Francescon: Thank you operator and to our team members. Thank you for your hard work dedication to century and commitment to our valued homebuyers to our investors and everyone else on the call. Today. We appreciate your continued support and look forward to speaking with you again next quarter and sharing our continued progress.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Okay.
Dale Francescon: Okay.
Dale Francescon: [noise].
Dale Francescon: Yeah.
Dale Francescon: Yeah.
Dale Francescon: Yeah.
Dale Francescon: Yeah.
Dale Francescon: [music].