GlobeNewswire Inc | Oct 21, 2020 04:30PM EDT

October 21, 2020

SCOTTSDALE, Ariz., Oct. 21, 2020 (GLOBE NEWSWIRE) -- Meritage Homes Corporation (NYSE: MTH), a leading U.S. homebuilder, reported third quarter results for the period ended September30, 2020.

Summary Operating Results (unaudited)(Dollars in thousands, except per share amounts)

Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 % Chg 2020 2019 % ChgHomesclosed 3,004 2,419 24 % 8,090 6,437 26 %(units)Homeclosing $ 1,133,221 $ 939,185 21 % $ 3,055,229 $ 2,500,888 22 %revenueAveragesales $ 377 $ 388 (3 )% $ 378 $ 389 (3 )%price -closingsHomeorders 3,851 2,258 71 % 10,550 7,523 40 %(units)Homeorder $ 1,488,480 $ 858,395 73 % $ 3,958,870 $ 2,879,369 37 %valueAveragesales $ 387 $ 380 2 % $ 375 $ 383 (2 )%price -ordersEndingbacklog 5,242 3,519 49 %(units)Endingbacklog $ 2,004,981 $ 1,397,033 44 %valueAveragesales $ 382 $ 397 (4 )%price -backlogEarningsbefore $ 135,506 $ 92,366 47 % $ 338,201 $ 192,410 76 %incometaxesNet $ 109,118 $ 69,809 56 % $ 270,948 $ 146,049 86 %earningsDiluted $ 2.84 $ 1.79 59 % $ 7.04 $ 3.76 87 %EPS

MANAGEMENT COMMENTS

"Our third quarter of 2020 results continued to outperform and reflect the current strength in the homebuilding market. Meritage had many remarkable achievements this past quarter: We delivered our highest quarterly sales orders, our strongest absorptions since 2005, record quarterly home closing revenue, and our best quarterly gross margin since 2014 - while also achieving our lowest net debt to capital in our company's history, said Steven J. Hilton, chairman and chief executive officer of Meritage Homes. These strong results are the combination of existing favorable market factors including historically-low mortgage interest rates and increased demand for healthier, safer homes, and Meritage's strategy of focusing on affordable entry-level and first move-up homes that allowed us to capitalize on that demand.

Our sales orders of 3,851 homes this quarter were 71% more than the third quarter of 2019 and surpassed our previous quarterly record set in the second quarter of 2020. Over just the first nine months of this year, we sold a total of 10,550 homes - well over the full year 2019 sales volume. We also closed 24% more homes than we did in the same quarter of the prior year. Home closing revenue increased 21% year-over-year to $1.1 billion for the third quarter of 2020, which combined with a 21.5% home closing gross margin to drive a 56% increase in our net earnings compared to the third quarter of 2019."

He continued, "To meet the surge in demand we are experiencing, we are investing significantly for additional growth. We spent nearly $300 million on land acquisition and development and put a record near 9,000 new lots under control this quarter, bringing the total lot supply to nearly 48,000 lots, as we increase our market share in our existing geographies and push toward our 300 community count goal by early to mid 2022."

Mr. Hilton concluded, "Based on our performance through the first three quarters of 2020 and confidence in our ability to deliver our backlog, we are projecting 11,200-11,500 total home closings for approximately $4.2-4.4 billion total home closing revenue and home closing gross margin of 21.0-21.5% for the full year 2020. We expect that to translate into approximately $10.25-10.50 diluted earnings per share, a year-over-year increase of more than 60%."

THIRD QUARTER RESULTS

-- The record total sales orders for the third quarter of 2020 reflected an increase of 71% year-over-year, driven by a 94% increase in absorption pace over the prior years third quarter with high demand for Meritage's entry-level LiVE.NOW product. Entry-level represented almost 70% of third quarter 2020 orders, compared to 54% in the same quarter in 2019. Absorptions doubled in Texas to six per month, compared to three per month in the third quarter last year, even with a 14% decline in average active communities. Absorptions were up 88% in the West region and 87% in the East region year-over-year, with significant increases across all states led by California's 137% increase.

-- A 21% year-over-year increase in home closing revenue to a record $1.1 billion for the quarter ended September 30, 2020 reflected a 24% increase in home closing volume partially offset by a 3% reduction in average sales price ("ASP"), which was primarily due to the shift in product mix toward entry-level as compared to 2019.

-- Home closing gross margin improved 170 bps to 21.5% from 19.8% a year ago. The additional closing volume and efficiencies gained from streamlined operations more than offset record high lumber prices and contributed to a 31% increase in total home closing gross profit over the prior year's third quarter.

-- Selling, general and administrative expenses ("SG&A") were 10.1% of third quarter 2020 home closing revenue, a 70 bps improvement over 10.8% in the third quarter of 2019 due to greater leverage of fixed expenses on higher home closing revenue, as well as cost savings from technology enhancements, particularly as related to the Company's sales and marketing efforts.

-- The third quarter effective income tax rate decreased to 19.5% in 2020 compared to 24.4% in 2019 primarily due to eligible energy tax credits on qualifying energy-efficient homes closed in 2020 that were not available in 2019, under the Taxpayer Certainty and Disaster Tax Relief Act enacted in December 2019.

-- Third quarter 2020 pre-tax margin increased 210 bps to 11.9%, compared to 9.8% in the third quarter of 2019. Net earnings were $109.1 million ($2.84 per diluted share) for the third quarter of 2020, a 56% increase over $69.8 million ($1.79 per diluted share) reported for the third quarter of 2019. Strong earnings growth reflected the increases in home closing revenue, gross margins and improved overhead leverage, which combined with the reduction in diluted shares after the repurchase of one million shares in the first quarter of 2020, led to a 59% year-over-year improvement in earnings per diluted share.

YEAR TO DATE RESULTS

-- Total orders for the first nine months of 2020 increased 40% year-over-year, driven by a 58% increase in absorptions on an 11% lower average community count, compared to the first nine months of 2019.

-- Home closings of 8,090 for the first nine months of 2020 increased 26% year-over-year with a 3% reduction in ASP on closings due to the product mix shift toward Meritage's entry-level product, resulting in a 22% year-over-year increase in home closing revenue to $3.1 billion.

-- Home closing gross margin increased 250 bps to 21.0% for the first nine months of 2020, compared to 18.5% in the same period of 2019, reflecting a 39% increase in total home closing gross profit for the first nine months of 2020.

-- SG&A expenses as a percentage of home closing revenue improved to 10.3% in the first nine months of 2020, compared to 11.2% in the first nine months of 2019, reflecting greater leverage of overhead expenses on higher home closing revenue, as well as technology and cost savings initiatives implemented at the start of the COVID-19 pandemic.

-- Interest expense decreased $6.2 million year-over-year, primarily due to lower debt balances reflecting the early redemption in December 2019 of $300 million senior notes that were due in early 2020.

-- The effective tax rate for the first nine months of 2020 was 19.9%, compared to 24.1% for the same period in 2019, primarily due to approximately $10 million in year-to-date 2020 estimated energy tax credits.

-- The pre-tax margin for the first nine months of 2020 increased 340 bps to 11.0%, compared to 7.6% for the first nine months of 2019. Year-to-date 2020 net earnings were $270.9 million ($7.04 per diluted share), an 86% increase over $146.0 million ($3.76 per diluted share) for year-to-date 2019, reflecting increases in home closing revenue and gross margin, combined with lower SG&A expenses and a lower effective tax rate in 2020, which combined with the reduction in diluted shares after the repurchase of one million shares in the first quarter of 2020, led to an 87% year-over-year improvement in earnings per diluted share.

BALANCE SHEET

-- Cash and cash equivalents at September 30, 2020 totaled $610.0 million, compared to $319.5 million at December 31, 2019, reflecting positive cash flow from operations of $373.1 million. Real estate assets at September 30, 2020 held relatively steady to December 31, 2019 as an increase in sold inventory resulted in a decrease in spec inventory.

-- Nearly 16,000 new lots were put under control in the first nine months of 2020, with over 55% coming from the third quarter of 2020 alone. The Company has been actively securing new lots following a short-lived dip in March and April due to COVID-19-related shutdowns. A total of nearly 48,000 lots were owned or controlled as of September 30, 2020, compared to approximately 37,000 total lots at September 30, 2019.

-- Debt-to-capital and net debt-to-capital ratios were 31.7% and 15.7%, respectively, at September 30, 2020, down from 34.0% and 26.2%, respectively, at December 31, 2019.

CONFERENCE CALLManagement will host a conference call to discuss the results at 8:00 a.m. Arizona Time (11:00 a.m. Eastern Time) on Thursday, October 22. The call will be webcast live with an accompanying slideshow, both of which will be available on the "Investor Relations" page of the Company's web site at https://investors.meritagehomes.com. For those unable to participate via the webcast, telephone participants can dial in to 1-800-437-2398 US toll free on the day of the call. The international dial-in number is 1-929-477-0577.

A replay of the call will be available beginning at approximately 10:00 a.m. Arizona Time (1:00 p.m. Eastern Time) on October 22 and extending through November 5, 2020, on the website noted above or by dialing 1-800-437-2398 US toll free, 1-929-477-0577 for international and referencing conference number 1805364.

Meritage Homes Corporation and SubsidiariesConsolidated Income Statements(In thousands, except per share data)(Unaudited)

Three Months Ended September 30, 2020 2019 Change $ Change %Homebuilding: Home closing revenue $ 1,133,221 $ 939,185 $ 194,036 21 %Land closing revenue 4,870 1,695 3,175 187 %Total closing revenue 1,138,091 940,880 197,211 21 %Cost of home closings (889,654 ) (753,068 ) 136,586 18 %Cost of land closings (4,360 ) (1,721 ) 2,639 153 %Total cost of (894,014 ) (754,789 ) 139,225 18 %closingsHome closing gross 243,567 186,117 57,450 31 %profitLand closing gross 510 (26 ) 536 N/Mprofit/(loss)Total closing gross 244,077 186,091 57,986 31 %profitFinancial Services: Revenue 4,939 4,317 622 14 %Expense (2,026 ) (1,725 ) 301 17 %Earnings fromfinancial servicesunconsolidated 1,402 2,990 (1,588 ) (53 )%entities and other,netFinancial services 4,315 5,582 (1,267 ) (23 )%profitCommissions and other (73,282 ) (63,450 ) 9,832 15 %sales costsGeneral andadministrative (40,737 ) (37,191 ) 3,546 10 %expensesInterest expense (55 ) (1,068 ) (1,013 ) (95 )%Other income, net 1,188 2,402 (1,214 ) (51 )%Earnings before 135,506 92,366 43,140 47 %income taxesProvision for income (26,388 ) (22,557 ) 3,831 17 %taxesNet earnings $ 109,118 $ 69,809 $ 39,309 56 % Earnings per common share:Basic Change $ or Change shares %Earnings per common $ 2.90 $ 1.82 $ 1.08 59 %shareWeighted average 37,607 38,296 (689 ) (2 )%shares outstandingDiluted Earnings per common $ 2.84 $ 1.79 $ 1.05 59 %shareWeighted average 38,405 39,079 (674 ) (2 )%shares outstanding

Nine Months Ended September 30, 2020 2019 Change $ Change %Homebuilding: Home closing $ 3,055,229 $ 2,500,888 $ 554,341 22 %revenueLand closing 16,954 12,747 4,207 33 %revenueTotal closing 3,072,183 2,513,635 558,548 22 %revenueCost of home (2,412,606 ) (2,039,191 ) 373,415 18 %closingsCost of land (17,509 ) (14,149 ) 3,360 24 %closingsTotal cost of (2,430,115 ) (2,053,340 ) 376,775 18 %closingsHome closing gross 642,623 461,697 180,926 39 %profitLand closing gross (555 ) (1,402 ) 847 60 %lossTotal closing gross 642,068 460,295 181,773 39 %profitFinancial Services: Revenue 13,329 11,705 1,624 14 %Expense (5,519 ) (4,949 ) 570 12 %Earnings fromfinancial servicesunconsolidated 3,132 9,559 (6,427 ) (67 )%entities and other,netFinancial services 10,942 16,315 (5,373 ) (33 )%profitCommissions and (204,863 ) (176,130 ) 28,733 16 %other sales costsGeneral andadministrative (111,083 ) (105,536 ) 5,547 5 %expensesInterest expense (2,176 ) (8,350 ) (6,174 ) (74 )%Other income, net 3,313 5,816 (2,503 ) (43 )%Earnings before 338,201 192,410 145,791 76 %income taxesProvision for (67,253 ) (46,361 ) 20,892 45 %income taxesNet earnings $ 270,948 $ 146,049 $ 124,899 86 % Earnings per common share:Basic Change $ or Change shares %Earnings per common $ 7.17 $ 3.83 $ 3.34 87 %shareWeighted average 37,763 38,119 (356 ) (1 )%shares outstandingDiluted Earnings per common $ 7.04 $ 3.76 $ 3.28 87 %shareWeighted average 38,491 38,841 (350 ) (1 )%shares outstanding

Meritage Homes Corporation and SubsidiariesConsolidated Balance Sheets(In thousands)(Unaudited)

September 30, December 31, 2020 2019Assets: Cash and cash equivalents $ 609,979 $ 319,466 Other receivables 96,702 88,492 Real estate ^(1) 2,741,016 2,744,361 Deposits on real estate under option or 62,967 50,901 contractInvestments in unconsolidated entities 3,819 4,443 Property and equipment, net 42,730 50,606 Deferred tax asset 28,425 25,917 Prepaids, other assets and goodwill 101,680 114,063 Total assets $ 3,687,318 $ 3,398,249 Liabilities: Accounts payable $ 167,788 $ 155,024 Accrued liabilities 274,371 226,008 Home sale deposits 25,509 24,246 Loans payable and other borrowings 23,031 22,876 Senior notes, net 996,770 996,105 Total liabilities 1,487,469 1,424,259 Stockholders' Equity: Preferred stock ? ? Common stock 377 382 Additional paid-in capital 460,268 505,352 Retained earnings 1,739,204 1,468,256 Total stockholders? equity 2,199,849 1,973,990 Total liabilities and stockholders? equity $ 3,687,318 $ 3,398,249

^(1) Real estate ? Allocated costs:Homes under contract under construction $ 967,222 $ 564,762 Unsold homes, completed and under 395,151 686,948 constructionModel homes 86,933 121,340 Finished home sites and home sites under 1,291,710 1,371,311 developmentTotal real estate $ 2,741,016 $ 2,744,361

Supplemental Information and Non-GAAP Financial Disclosures (Dollars in thousands unaudited):

Three Months Ended September Nine Months Ended 30, September 30, 2020 2019 2020 2019Depreciation and $ 7,945 $ 7,172 $ 22,496 $ 19,553 amortization Summary of Capitalized Interest:Capitalized interest, $ 72,882 $ 88,307 $ 82,014 $ 88,454 beginning of periodInterest incurred 16,103 21,319 50,188 64,227 Interest expensed (55 ) (1,068 ) (2,176 ) (8,350 )Interest amortized tocost of home and land (21,380 ) (20,363 ) (62,476 ) (56,136 )closingsCapitalized interest, $ 67,550 $ 88,195 $ 67,550 $ 88,195 end of period September 30, December 31, 2020 2019Notes payable and $ 1,019,801 $ 1,018,981 other borrowingsStockholders' equity 2,199,849 1,973,990 Total capital $ 3,219,650 $ 2,992,971 Debt-to-capital 31.7 % 34.0 % Notes payable and $ 1,019,801 $ 1,018,981 other borrowingsLess: cash and cash (609,979 ) (319,466 ) equivalentsNet debt $ 409,822 $ 699,515 Stockholders? equity 2,199,849 1,973,990 Total net capital $ 2,609,671 $ 2,673,505 Net debt-to-capital 15.7 % 26.2 %

Meritage Homes Corporation and SubsidiariesConsolidated Statements of Cash Flows(In thousands) (Unaudited)

Nine Months Ended September 30, 2020 2019Cash flows from operating activities: Net earnings $ 270,948 $ 146,049 Adjustments to reconcile net earnings to net cash provided by operating activities:Depreciation and amortization 22,496 19,553 Stock-based compensation 15,724 15,719 Equity in earnings from unconsolidated entities (2,821 ) (8,934 )Distribution of earnings from unconsolidated 2,449 11,261 entitiesOther 1,881 3,902 Changes in assets and liabilities: Decrease/(increase) in real estate 9,080 (110,295 )(Increase)/decrease in deposits on real estate (12,910 ) 5,773 under option or contractDecrease/(increase) in other receivables, 4,933 (3,108 )prepaids and other assetsIncrease in accounts payable and accrued 60,039 84,632 liabilitiesIncrease in home sale deposits 1,263 2,808 Net cash provided by operating activities 373,082 167,360 Cash flows from investing activities: Investments in unconsolidated entities (4 ) (1,112 )Distributions of capital from unconsolidated 1,000 7,250 entitiesPurchases of property and equipment (14,771 ) (18,376 )Proceeds from sales of property and equipment 528 267 Maturities/sales of investments and securities 632 675 Payments to purchase investments and securities (632 ) (675 )Net cash used in investing activities (13,247 ) (11,971 )Cash flows from financing activities: Repayment of loans payable and other borrowings (8,509 ) (3,086 )Repurchase of shares (60,813 ) (8,957 )Net cash used in financing activities (69,322 ) (12,043 )Net increase in cash and cash equivalents 290,513 143,346 Beginning cash and cash equivalents 319,466 311,466 Ending cash and cash equivalents $ 609,979 $ 454,812

Meritage Homes Corporation and SubsidiariesOperating Data(Dollars in thousands) (Unaudited)

Three Months Ended September 30, 2020 2019 Homes Value Homes ValueHomes Closed: Arizona 429 $ 143,630 440 $ 144,920 California 332 202,460 200 135,555 Colorado 183 88,199 169 85,674 West Region 944 434,289 809 366,149 Texas 1,059 349,907 810 278,744 Central Region 1,059 349,907 810 278,744 Florida 339 124,836 302 118,804 Georgia 178 62,921 139 46,984 North Carolina 295 98,322 206 77,696 South Carolina 78 25,502 75 23,768 Tennessee 111 37,444 78 27,040 East Region 1,001 349,025 800 294,292 Total 3,004 $ 1,133,221 2,419 $ 939,185 Homes Ordered: Arizona 709 $ 240,151 482 $ 159,778 California 510 319,680 198 124,201 Colorado 188 88,972 156 74,498 West Region 1,407 648,803 836 358,477 Texas 1,183 395,453 649 217,648 Central Region 1,183 395,453 649 217,648 Florida 491 179,607 293 111,471 Georgia 172 62,541 138 47,527 North Carolina 386 132,988 188 69,017 South Carolina 90 28,140 55 17,520 Tennessee 122 40,948 99 36,735 East Region 1,261 444,224 773 282,270 Total 3,851 $ 1,488,480 2,258 $ 858,395

Nine Months Ended September 30, 2020 2019 Homes Value Homes ValueHomes Closed: Arizona 1,315 $ 437,233 1,126 $ 368,762 California 787 487,605 464 304,846 Colorado 553 268,970 507 264,479 West Region 2,655 1,193,808 2,097 938,087 Texas 2,747 901,791 2,176 760,189 Central Region 2,747 901,791 2,176 760,189 Florida 942 357,233 809 321,364 Georgia 459 163,617 380 132,440 North Carolina 805 276,477 558 204,866 South Carolina 229 73,113 202 66,513 Tennessee 253 89,190 215 77,429 East Region 2,688 959,630 2,164 802,612 Total 8,090 $ 3,055,229 6,437 $ 2,500,888 Homes Ordered: Arizona 2,016 $ 654,579 1,521 $ 493,391 California 1,250 769,251 572 368,194 Colorado 540 258,268 580 290,060 West Region 3,806 1,682,098 2,673 1,151,645 Texas 3,457 1,130,943 2,346 799,293 Central Region 3,457 1,130,943 2,346 799,293 Florida 1,198 435,411 925 369,503 Georgia 518 182,958 431 149,731 North Carolina 999 340,626 658 241,573 South Carolina 272 85,316 205 65,540 Tennessee 300 101,518 285 102,084 East Region 3,287 1,145,829 2,504 928,431 Total 10,550 $ 3,958,870 7,523 $ 2,879,369 Order Backlog: Arizona 1,212 $ 404,044 738 $ 258,341 California 608 373,949 199 129,880 Colorado 183 87,047 258 129,167 West Region 2,003 865,040 1,195 517,388 Texas 1,758 602,709 1,151 413,229 Central Region 1,758 602,709 1,151 413,229 Florida 627 242,419 488 213,427 Georgia 192 69,204 174 63,730 North Carolina 413 143,741 277 104,162 South Carolina 114 36,723 92 31,474 Tennessee 135 45,145 142 53,623 East Region 1,481 537,232 1,173 466,416 Total 5,242 $ 2,004,981 3,519 $ 1,397,033

Meritage Homes Corporation and SubsidiariesOperating Data(Unaudited)

Three Months Ended September 30, 2020 2019 Ending Average Ending AverageActive Communities: Arizona 35 36.5 37 38.5 California 20 24.0 24 22.0 Colorado 11 12.0 20 20.5 West Region 66 72.5 81 81.0 Texas 58 63.0 74 73.5 Central Region 58 63.0 74 73.5 Florida 34 35.0 36 36.0 Georgia 11 14.0 18 19.5 North Carolina 20 20.5 22 22.5 South Carolina 6 5.5 10 9.5 Tennessee 9 10.0 9 10.0 East Region 80 85.0 95 97.5 Total 204 220.5 250 252.0

Nine Months Ended September 30, 2020 2019 Ending Average Ending AverageActive Communities: Arizona 35 34.3 37 38.5 California 20 25.3 24 20.5 Colorado 11 13.8 20 20.0 West Region 66 73.4 81 79.0 Texas 58 70.3 74 84.5 Central Region 58 70.3 74 84.5 Florida 34 34.4 36 33.5 Georgia 11 15.3 18 20.0 North Carolina 20 21.6 22 23.5 South Carolina 6 6.8 10 11.0 Tennessee 9 10.3 9 9.5 East Region 80 88.4 95 97.5 Total 204 232.1 250 261.0

About Meritage Homes CorporationMeritage Homes is the seventh-largest public homebuilder in the United States, based on homes closed in 2019. Meritage offers a variety of homes that are designed with a focus on first-time and first move-up buyers in Arizona, California, Colorado, Texas, Florida, Georgia, North Carolina, South Carolina and Tennessee.

The Company has designed and built over 135,000 homes in its 35-year history, and has a reputation for its distinctive style, quality construction, and award-winning customer experience. Meritage is the industry leader in energy-efficient homebuilding and a seven-year recipient of the U.S. Environmental Protection Agencys ENERGY STAR Partner of the Year for Sustained Excellence Award since 2013 for innovation and industry leadership in energy efficient homebuilding.

For more information, visit www.meritagehomes.com.

The information included in this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include statements regarding health of the housing market and the potential adverse impacts of the COVID-19 pandemic, and projected full year 2020 home closings, home closing revenue, gross margins and diluted earnings per share.

Such statements are based on the current beliefs and expectations of Company management and current market conditions, which are subject to significant uncertainties and fluctuations. Actual results may differ from those set forth in the forward-looking statements. The Company makes no commitment, and disclaims any duty, to update or revise any forward-looking statements to reflect future events or changes in these expectations, except as required by law. Meritage's business is subject to a number of risks and uncertainties. As a result of those risks and uncertainties, the Company's stock and note prices may fluctuate dramatically. These risks and uncertainties include, but are not limited to, the following: disruptions to our business by COVID-19, fear of a similar event, and measures implemented by federal, state and local governments or health authorities to address it; the availability and cost of finished lots and undeveloped land; shortages in the availability and cost of labor; the ability of our potential buyers to sell their existing homes; changes in interest rates and the availability and pricing of residential mortgages; our exposure to information technology failures and security breaches; legislation related to tariffs; inflation in the cost of materials used to develop communities and construct homes; the adverse effect of slow absorption rates; impairments of our real estate inventory; cancellation rates; competition; changes in tax laws that adversely impact us or our homebuyers; a change to the feasibility of projects under option or contract that could result in the write-down or write-off of earnest or option deposits; our potential exposure to and impacts from natural disasters or severe weather conditions; home warranty and construction defect claims; failures in health and safety performance; our ability to obtain performance and surety bonds in connection with our development work; the loss of key personnel; failure to comply with laws and regulations; our limited geographic diversification; fluctuations in quarterly operating results; our level of indebtedness; our ability to obtain financing if our credit ratings are downgraded; our compliance with government regulations, the effect of legislative and other governmental actions, orders, policies or initiatives that impact housing, labor availability, construction, mortgage availability, our access to capital, the cost of capital or the economy in general, or other initiatives that seek to restrain growth of new housing construction or similar measures; legislation relating to energy and climate change; the replication of our energy-efficient technologies by our competitors; negative publicity that affects our reputation and other factors identified in documents filed by the Company with the Securities and Exchange Commission, including those set forth in our Form 10-K for the year ended December 31, 2019 and our Form 10-Q for the quarter ended June 30, 2020 under the caption "Risk Factors," which can be found on our website at www.investors.meritagehomes.com.

Contacts: Emily Tadano, VP Investor Relations (480) 515-8979 (office) investors@meritagehomes.com