M/I Homes (MHO) investor relations material

Executive summary

• Achieved record Q2 revenue of $1.16–$1.2 billion and record homes delivered (2,348), up 5–6% year-over-year, despite challenging macroeconomic conditions and higher interest rates impacting demand.

• Net income declined to $121 million ($4.42 per share), down 14–17% year-over-year, as margins fell due to higher incentives and interest rate buydowns.

• New contracts declined 8% year-over-year, with backlog units down 25% and sales value down 22%, reflecting softer demand and extended homebuying timelines.

• Shareholders' equity reached a record $3.1 billion, up 12% year-over-year, with book value per share at $117.

• Focus on affordability, with 52% of Q2 sales from homes averaging $400,000, and a diversified presence in 17 markets.

Financial highlights

• Q2 2025 revenue rose 5% year-over-year to $1.16–$1.2 billion; pre-tax income fell 18% to $160 million; net income was $121 million.

• Gross margin declined to 24.7% (down 320 basis points year-over-year); EPS decreased to $4.42.

• Adjusted EBITDA for Q2 was $169 million, down from $200 million a year ago.

• Return on equity stood at 17% for the last twelve months.

• Homebuilding debt to capital ratio was 18% at quarter end; net debt to capital was -3%.

Outlook and guidance

• Management expects average community count to grow by about 5% for 2025, with a continued focus on profitability, affordability, and market share expansion.

• Margins expected to stabilize near current levels, with potential for improvement if interest rates decline.

• Management anticipates challenging market conditions, including elevated mortgage rates and affordability concerns, to persist through 2025.

• Strategic focus remains on targeted incentives, controlling overhead, prudent land investment, and maintaining strong liquidity.

• Leadership remains confident in long-term housing demand and industry fundamentals.