Taylor Morrison Home (TMHC) Q4 2023 earnings summary

Executive summary

• FY 2023 revenue was $7.418B, down 10% YoY; closings totaled 11,495, down 9%, while net sales orders rose 14% to 10,830.

• FY 2023 net income was $769M, or $6.98 per diluted share; adjusted net income was $830M, or $7.54 per diluted share.

• Q4 net sales orders rose 30% to 2,361 as closings declined 16% to 3,190; year-end backlog was 5,289 homes valued at $3.645B.

• Priorities included growth, disciplined land investment, digital selling, profitability and shareholder returns.

Financial highlights

• Q4 total revenue was $2.020B, down 19% YoY; home closings revenue was $1.938B, down 18.5%.

• FY home closings revenue was $7.159B, down 9.3% YoY; reported gross margin was 23.9% and adjusted margin was 24.0%.

• Q4 reported net income was $173M, or $1.58 per diluted share; adjusted net income was $223M, or $2.05 per diluted share.

• FY reported net income was $769M, or $6.98 per diluted share; adjusted net income was $830M, or $7.54 per diluted share.

• Q4 adjusted home closings gross margin was 24.1%, down 40 bps YoY; FY revenue was $7.418B, down 9.8%.

Outlook and guidance

• FY 2024 closings guidance is at least 12,000, at an average selling price near $600,000 and gross margin of 23.0%–23.5%.

• FY 2024 ending active communities are expected at 320–325; SG&A is guided to the high-9% range and the effective tax rate near 25%.

• FY 2024 land and development spend is forecast at $2.3B–$2.5B; approximately 40% is allocated to development.

• Q1 2024 closings are guided at ~2,700, at an average price near $600,000 and gross margin of 23.0%–23.5%.

• 2024 share repurchases are expected to be ~$300M; closing growth of ~10% is expected in 2025 and thereafter.