GlobeNewswire Inc | Mar 8, 2021 04:05PM EST

March 08, 2021

QUARTERLY BASIC EARNINGS PER SHARE OF $0.58 VS $0.32, UP 81.3%

FISCAL YEAR 2020 ANNUAL RESULTS REACH ALL-TIME RECORD

PLANO, Texas, March 08, 2021 (GLOBE NEWSWIRE) -- Green Brick Partners, Inc. (Nasdaq: GRBK) (we, Green Brick or the Company) today reported results for its fourth quarter and year ended December 31, 2020, which were in line with the preliminary results announced on January 22, 2021.

Green Bricks robust growth and financial success reached new highs this year, said Jim Brickman, Chief Executive Officer. The Company achieved a record diluted EPS of $2.24, up 93% year over year, representing a 34% compounded annual growth rate from our FY 2015 results. Demand for our homes has been tremendous at all price points and continues to climb with net new orders in January and February 2021 up 80% year over year, well above the 63% year over year increase seen in the last half of 2020.

Thanks to our significant investment in land and lots this past year, our lots owned and controlled reached a record 14,468 lots, up 58% from just six months ago. This growth was accomplished despite a record 1,004 construction starts in the fourth quarter of 2020, a 99% increase over the fourth quarter of 2019. With both our construction and lot inventories entering 2021 at record levels, we fully expect to build upon our tremendous progress over this past year and continue our rapid growth trajectory into 2021.

Results for the Year Ended December 31, 2020:

For the twelve months ended December 31, 2020, basic net income attributable to Green Brick per common share (EPS), total revenues, residential units revenue, net income attributable to Green Brick, and backlog reflect a record for any twelve-month period since the Companys inception, as detailed below.

(Dollars in thousands, except per share Twelve Months Ended December 31,data) 2020 2019 IncreaseNet new home orders 2,885 1,923 50.0 %New homes delivered 2,208 1,719 28.4 % Total revenues $ 976,021 $ 791,660 23.3 %Total cost of revenues 741,417 622,578 19.1 %Total gross profit $ 234,604 $ 169,082 38.8 %Net income attributable to Green Brick $ 113,693 $ 58,656 93.8 %Partners, Inc.Basic net income attributable to Green $ 2.25 $ 1.16 94.0 %Brick Partners, Inc. per share Residential units revenue $ 930,176 $ 759,830 22.4 %Homebuilding gross margin percentage 24.2 % 21.4 % 280 bps Backlog $ 686,861 $ 346,828 98.0 %Lots owned and controlled 14,468 8,976 61.2 %Homes under construction 1,780 1,297 37.2 %Average active selling communities 96 86 11.6 %Net income attributable to Green BrickPartners, Inc. as a percentage of the 19.5 % 11.8 % 770 average total Green Brick Partners, Inc. bpsstockholders? equity

Results for the Fourth Quarter Ended December 31, 2020:

Highlights for the three months ended December 31, 2020 included the following:

-- EPS for the three months ended December 31, 2020 was $0.58, a 81.3% increase compared to EPS of $0.32 for the three months ended December31, 2019.

-- Net income attributable to Green Brick was $29.3 million, an increase of 84.1% from $15.9 million.

-- As compared to the three months ended December31, 2019, total revenues were $254.1 million, an increase of 10.4% from $230.1 million; and gross profit was $63.9 million, an increase of 31.1% from $48.7 million.

-- Residential units revenue was $246.4 million, an increase of 10.4% compared to $223.3 million for the three months ended December31, 2019. Land and lots revenue was $7.7 million, an increase of 11.8% compared to $6.9 million for the three months ended December31, 2019.

The strong operating results and financial success this year would not have been possible without access to reliable and cost-effective capital, said Rick Costello, Chief Financial Officer. I am pleased to announce Green Brick has issued an additional $125 million in senior unsecured notes as of February 25, 2021. These notes will be due in 2028 at a fixed rate of 3.25%. With this expansion of our working capital, Green Brick has clearly demonstrated its capacity to grow its business with low-cost debt which is priced comparably to that of our low-leveraged large-cap peers, all while maintaining one of the lowest debt to capital ratios in the industry at 25.6%.

Mr. Costello continued, During the fourth quarter of 2020 and continuing into March 2021, we have raised home prices more aggressively to further increase margins and attempt to slow down our sales pace. The Company intends for this increase in pricing to lead to lower new order levels, but higher profits, prospectively.

Green Brick, like every other company in the United States and the global economy, has been impacted by the coronavirus (COVID-19) pandemic and the impact of governmental actions taken to combat the pandemic. After an initial decline in orders and construction at the onset of the crisis, orders have subsequently achieved all-time highs due to historically low mortgage interest rates, the participation in home ownership in increasing amounts by the millennial generation, the desire of renters to leave high density living conditions, and the relative strength of the markets in which we operate. It has been difficult to keep up with demand. As construction follows orders, we expect closings to grow substantially beginning in the second quarter of 2021.

More disclosures related to the COVID-19 pandemic can be found in our Annual Report on Form 10-K for the year ended December 31, 2020 that will be filed with the Securities and Exchange Commission.

Share Repurchase Program

The Company also announced that the Board of Directors has authorized a new $50 million stock repurchase plan. This plan authorizes the Company to purchase, from time to time, until March 1, 2023, up to $50 million of our outstanding common stock through open market repurchases in compliance with Rule 10b-18 under the Exchange Act and/or in privately negotiated transactions at managements discretion based on market and business conditions, applicable legal requirements and other factors. Shares repurchased will be retired. The plan may be modified or terminated by the Companys Board of Directors at any time in its sole discretion.

Earnings Conference Call:

We will host our earnings conference call to discuss our fourth quarter ended December 31, 2020 at 12:00 p.m. Eastern Time on Tuesday, March9, 2021. The call can be accessed by dialing 800-374-0137 for domestic participants or 904-685-8013 for international participants. Participants should reference conference ID code 5479336. A replay of the call will be available from approximately 2:45 p.m. Eastern Time on March9, 2021 through 11:59 p.m. Eastern Time on March23, 2021. To access the replay, the domestic dial-in number is 855-859-2056, the international dial-in number is 404-537-3406 and the conference ID code is 5479336.

Non-GAAP Financial Measures and Key Financial Metrics:

In this press release, we utilize certain financial measures that are non-GAAP financial measures as defined by the Securities and Exchange Commission. We present these measures because we believe they and similar measures are useful to management and investors in evaluating the Companys operating performance and financing structure. We also believe these measures facilitate the comparison of our operating performance and financing structure with other companies in our industry. Because these measures are not calculated in accordance with U.S. Generally Accepted Accounting Principles (GAAP), they may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

Reclassifications:

Certain prior period amounts have been reclassified to conform to the current period presentation with no impact to net income in any period.

GREEN BRICK PARTNERS, INC.CONDENSED CONSOLIDATED STATEMENTS OF INCOME(In thousands, except per share data)

(Unaudited) Three Months Ended December Twelve Months Ended December 31, 31, 2020 2019 2020 2019Residential units $ 246,437 $ 223,270 $ 930,176 $ 759,830 revenueLand and lots 7,663 6,852 45,845 31,830 revenueTotal revenues 254,100 230,122 976,021 791,660 Cost of 184,534 176,221 705,866 597,884 residential unitsCost of land and 5,712 5,191 35,551 24,694 lotsTotal cost of 190,246 181,412 741,417 622,578 revenuesTotal gross profit 63,854 48,710 234,604 169,082 Selling, generaland administrative (30,416 ) (27,191 ) (112,134 ) (97,775 )expensesChange in fairvalue of (158 ) (3,157 ) (368 ) (4,906 )contingentconsiderationEquity in incomeof unconsolidated 3,616 2,244 16,654 9,809 entitiesOther income, net 1,053 1,976 4,057 8,119 Income before 37,949 22,582 142,813 84,329 income taxesIncome tax expense 7,659 5,034 25,016 20,027 Net income 30,290 17,548 117,797 64,302 Less: Net incomeattributable to 980 1,628 4,104 5,646 noncontrollinginterestsNet incomeattributable to $ 29,310 $ 15,920 $ 113,693 $ 58,656 Green BrickPartners, Inc. Net incomeattributable toGreen Brick Partners, Inc. percommon share:Basic $ 0.58 $ 0.32 $ 2.25 $ 1.16 Diluted $ 0.58 $ 0.31 $ 2.24 $ 1.16 Weighted averagecommon shares usedin the calculationof net income attributable toGreen BrickPartners, Inc. percommon share:Basic 50,617 50,429 50,568 50,530 Diluted 50,967 50,619 50,795 50,636

GREEN BRICK PARTNERS, INC.CONDENSED CONSOLIDATED BALANCE SHEETS(In thousands, except share data)

December December 31, 2020 31, 2019

ASSETSCash and cash equivalents $ 19,479 $ 33,269 Restricted cash 14,156 4,416 Receivables 5,224 4,720 Inventory 844,635 753,567 Investments in unconsolidated entities 46,443 30,294 Right-of-use assets - operating leases 2,538 3,462 Property and equipment, net 3,595 4,309 Earnest money deposits 22,242 14,686 Deferred income tax assets, net 15,376 15,262 Intangible assets, net 622 707 Goodwill 680 680 Other assets 13,857 10,167 Total assets $ 988,847 $ 875,539

LIABILITIES AND EQUITYLiabilities: Accounts payable $ 24,521 $ 30,044 Accrued expenses 40,416 24,656 Customer and builder deposits 38,131 23,954 Lease liabilities - operating leases 2,591 3,564 Borrowings on lines of credit, net 106,687 164,642 Senior unsecured notes, net 111,056 73,406 Notes payable 2,125 ? Contingent consideration 368 5,267 Total liabilities 325,895 325,533 Commitments and contingencies Redeemable noncontrolling interest in equity of 13,543 13,611 consolidated subsidiaryEquity: Green Brick Partners, Inc. stockholders? equity Preferred stock, $0.01 par value: 5,000,000 shares ? ? authorized; none issued and outstandingCommon stock, $0.01 par value: 100,000,000 sharesauthorized; 51,053,858 and 50,879,949 issued and 511 509 50,661,919 and 50,488,010 outstanding as of December31, 2020 and December 31, 2019, respectivelyTreasury stock, at cost, 391,939 shares (3,167 ) (3,167 )Additional paid-in capital 293,242 290,799 Retained earnings 349,656 235,027 Total Green Brick Partners, Inc. stockholders? equity 640,242 523,168 Noncontrolling interests 9,167 13,227 Total equity 649,409 536,395 Total liabilities and equity $ 988,847 $ 875,539

GREEN BRICK PARTNERS, INC.SUPPLEMENTAL INFORMATION(Unaudited)

ResidentialUnits Revenue Three Months Ended December 31, Twelve Months Ended December 31,and New HomesDelivered(dollars in 2020 2019 Change % 2020 2019 Change %thousands)Home closings $ 245,549 $ 223,270 $ 22,279 10.0 % $ 923,901 $ 752,273 $ 171,628 22.8 %revenueMechanic?slien 888 ? 888 100 % 6,275 7,557 (1,282 ) (17.0 ) %contractsrevenueResidential $ 246,437 $ 223,270 $ 23,167 10.4 % $ 930,176 $ 759,830 $ 170,346 22.4 %units revenueNew homes 585 514 71 13.8 % 2,208 1,719 489 28.4 %deliveredAverage salesprice of $ 419.7 $ 434.4 $ (14.7 ) (3.4 ) % $ 418.4 $ 437.6 $ (19.2 ) (4.4 ) %homesdelivered

Land and Lots Revenue Three Months Ended December 31, Twelve Months Ended December 31,(dollars in thousands) 2020 2019 Change % 2020 2019 Change %Lots revenue $ 7,663 $ 6,852 $ 811 11.8 % $ 45,461 $ 31,820 $ 13,641 42.9 %Land revenue ? ? ? ? % 384 10 374 3,740.0 %Land and lots revenue $ 7,663 $ 6,852 $ 811 11.8 % $ 45,845 $ 31,830 $ 14,015 44.0 %Lots closed 73 45 28 62.2 % 375 211 164 77.7 %Average sales price of $ 105.0 $ 152.3 $ (47.3 ) (31.1 ) $ 121.2 $ 150.8 $ (29.6 ) (19.6 ) %lots closed %

New HomeOrders and Three Months Ended December 31, Twelve Months Ended December 31,Backlog(dollars in 2020 2019 Change % 2020 2019 Change %thousands)Net new home 848 590 258 43.7 % 2,885 1,923 962 50.0 %ordersCancellation 8.6 % 10.6 % (2.0 ) % (18.9 ) % 13.0 % 12.9 % 0.1 % 0.8 %rateAbsorptionrate peraverage active 8.3 6.6 1.7 25.8 % 7.5 5.6 1.9 33.9 %sellingcommunity perquarterAverage activeselling 102 90 12 13.3 % 96 86 10 11.6 %communitiesActive sellingcommunities at 103 95 8 8.4 % end of periodBacklog $ 686,861 $ 346,828 $ 340,033 98.0 % Backlog 1,463 786 677 86.1 % (units)Average salesprice of $ 469.5 $ 441.3 $ 28.2 6.4 % backlog

December 31, 2020 December 31, 2019Lots owned Central 6,823 4,223 Southeast 2,097 2,196 Total lots owned 8,920 6,419 Lots controlled (1) Central 4,398 1,410 Southeast 1,150 1,147 Total lots controlled 5,548 2,557 Total lots owned and controlled ^(1) 14,468 8,976 Percentage of lots owned 61.7 % 71.5 %



(1)Total lots excludes lots with homes under construction.

GREEN BRICK PARTNERS, INC.SUPPLEMENTAL INFORMATION(Unaudited)

The following table presents additional information on the lots we owned as of December 31, 2020 and 2019.

December 31, December 31, 2020 2019Total lots owned 8,920 6,419 Add certain lots included in Total Lots ControlledLand under option for future acquisition and 740 431 developmentLots under option through unconsolidated 1,838 552 development joint venturesTotal lots self-developed 11,498 7,402 Self-developed lots as a percentage of total lots 79.5 % 82.5 %owned and controlled

Reconciliation of Non-GAAP Financial Measures

The following table represents the non-GAAP measure of adjusted homebuilding gross margin for the three and twelve months ended December 31, 2020 and 2019 and reconciles these amounts to homebuilding gross margin, the most directly comparable GAAP measure.

Three Months Ended December Twelve Months Ended December 31, 31,(Unaudited, in 2020 2019 2020 2019thousands):Residential units $ 246,437 $ 223,270 $ 930,176 $ 759,830 revenueLess: Mechanic?slien contracts (888 ) ? (6,275 ) (7,557 ) revenueHome closings $ 245,549 $ 223,270 $ 923,901 $ 752,273 revenueHomebuilding gross $ 61,680 $ 48,249 $ 223,130 $ 160,952 marginHomebuilding gross 25.1 % 21.6 % 24.2 % 21.4 %margin percentage Homebuilding gross 61,680 48,249 223,130 160,952 marginAdd back:Capitalized 2,380 2,333 10,182 7,886 interest charged tocost of revenuesAdjustedhomebuilding gross 64,060 $ 50,582 $ 233,312 $ 168,838 marginAdjustedhomebuilding gross 26.1 % 22.7 % 25.3 % 22.4 %margin percentage

The following table presents the pre-tax income for the three and twelve months ended December 31, 2020 and 2019, which represents net income attributable to Green Brick for the period excluding the provision for income taxes attributable to Green Brick, and reconciles these amounts to net income attributable to Green Brick, the most directly comparable GAAP measure.

Three Months Ended December Twelve Months Ended December 31, 31,(Unaudited, in 2020 2019 2020 2019thousands):Net incomeattributable to $ 29,310 $ 15,920 $ 113,693 $ 58,656 Green BrickPartners, Inc.Income taxexpenseattributable to 7,656 4,959 25,010 19,712 Green BrickPartners, Inc.Pre-tax incomeattributable to $ 36,966 $ 20,879 $ 138,703 $ 78,368 Green BrickPartners, Inc.

The following table presents the non-GAAP measure of net income attributable to Green Brick Partners, Inc. for the twelve months ended December 31, 2020 and 2019, divided by the average total Green Brick Partners, Inc. stockholders equity to calculate the Companys return on average equity. The Company believes this non-GAAP financial measure is relevant in measuring the Companys profitability in relation to stockholders equity and should only be used to supplement the Companys GAAP results.

Twelve Months Ended December 31,(Unaudited, in thousands): 2020 2019Net income attributable to Green Brick Partners, $ 113,693 $ 58,656 Inc.Beginning total Green Brick Partners, Inc. 523,168 468,351 stockholders? equityEnding total Green Brick Partners, Inc. 640,242 $ 523,168 stockholders? equityAverage total Green Brick Partners, Inc. $ 581,705 $ 495,760 stockholders? equityNet income attributable to Green Brick Partners,Inc. as a percentage of the average total Green 19.5 % 11.8 %Brick Partners, Inc. stockholders? equity

About Green Brick Partners, Inc.

Green Brick Partners, Inc. (Nasdaq: GRBK) is a diversified homebuilding and land development company. Green Brick owns four homebuilders in Dallas, Texas (CB JENI Homes, Normandy Homes, Southgate Homes, and Trophy Signature Homes), as well as a controlling interest in homebuilders in Atlanta, Georgia (The Providence Group), Port St. Lucie, Florida (GHO Homes), and Dallas, Texas (Centre Living Homes). Green Brick also owns a noncontrolling interest in Challenger Homes in Colorado Springs, Colorado, and retains interests in related financial services platforms, including Green Brick Title, Green Brick Mortgage, and BHome Mortgage. The Company is engaged in all aspects of the homebuilding process, including land acquisition and development, entitlements, design, construction, marketing, and sales for its residential neighborhoods and master planned communities.

Forward-Looking and Cautionary Statements:

This press release and our earnings call contain forward-looking statements within the meaning of the Private Securities Litigation Act of 1995. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts and typically include the words anticipate, believe, consider, estimate, expect, forecast, intend, objective, plan, predict, projection, seek, strategy, target, will or other words of similar meaning. Forward-looking statements in this press release and the earnings call include statements regarding (i) the Companys strategy for growth, the drivers of that growth, and the impact on the Companys results, (ii) the Company's growth in closings, and the timing and significance of that growth. These forward-looking statements involve estimates and assumptions which may be affected by risks and uncertainties in the Companys business, as well as other external factors, which could cause future results to materially differ from those expressed or implied in any forward-looking statement. These risks include, but are not limited to: (1) continuing impacts from the COVID-19 pandemic, (2) general economic conditions, seasonality, cyclicality and competition in the homebuilding industry; (3) changes in macroeconomic conditions, including interest rates and unemployment rates, that could adversely impact demand for new homes or the ability of our buyers to qualify; (4) shortages, delays or increased costs of raw materials, especially in light of COVID-19, or increases in the Companys other operating costs, including costs related to labor, real estate taxes and insurance, which in each case exceed our ability to increase prices; (5) a shortage of labor, (6) an inability to acquire land in our markets at anticipated prices or difficulty in obtaining land-use entitlements; (7) our inability to successfully execute our strategies, including an inability to expand our Trophy brand; (8) a failure to recruit, retain or develop highly skilled and competent employees; (9) government regulation risks; (10) a lack of availability or volatility of mortgage financing or a rise in interest rates; (11) severe weather events or natural disasters; (12) difficulty in obtaining sufficient capital to fund our growth; (13) our ability to meet our debt service obligations; (14) a decline in the value of our inventories and resulting write-downs of the carrying value of our real estate assets; (15) changes in accounting standards that adversely affect our reported earnings or financial condition. For a more detailed discussion of these and other risks and uncertainties applicable to the Company please see the Companys most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Contact: Richard A. CostelloChief Financial Officer(469) 573-6755