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Century Communities, Inc$27.40($.85)(3.01%)

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 Century Communities Reports Fourth Quarter and Full Year 2015 Results
   Thursday, February 18, 2016 4:01:01 PM ET

--- Home Sales Revenue Grew 106% to $725.4 Million for Full Year -

--- Adjusted Homebuilding Gross Margin Percentage Improved to 22.0% for Fourth Quarter -

Century Communities, Inc. (CCS ), a top-25 U.S. homebuilder of single-family homes, townhomes and flats in select markets, today announced financial results for its fourth quarter and full year ending December 31, 2015.

Fourth Quarter 2015 Highlights Compared to Fourth Quarter 2014

-- Net income grew 83% to $13.2 million

-- Pre-tax income of $20.4 million, an increase of 85%

-- Home sales revenues increased 53% to $204.5 million

-- Home deliveries up 40% to 645 homes

-- Adjusted homebuilding gross margin grew 60% to $45.0 million

-- Selling, General & Administrative ("SG&A") as a percent of home sales revenues declined to 10.7%, an improvement of 110 basis points

-- Adjusted EBITDA expanded 53% to $24.8 million

-- Net new home contracts grew 25% to 455 homes

-- Open communities at the end of the quarter increased 13.3% to 94 (an increase of 17.3% to 88 based on redefined calculation of open communities beginning in 2016)

-- Upsized unsecured revolving credit facility to $300 million, with a $100 million accordion feature

"We are pleased with the sustained improvement across our key business metrics to deliver our 13th consecutive year of profitability," stated Dale Francescon, Co-Chief Executive Officer of the Company. "During the fourth quarter, we significantly improved our net income reflecting higher home deliveries and improved SG&A leverage on our scalable platform. This progress, along with a 100 basis point year-over-year increase in our adjusted gross margin percentage, demonstrates the strength of our expansion strategy and commitment to our stated goals to significantly grow our revenue and profitability. As we move forward in 2016, we expect to further increase our deliveries, enhance our profitability and deploy our capital opportunistically to drive shareholder value."

"During the full year 2015, we delivered on our strategy to successfully transform our Company into a top 25 U.S. home builder," said Rob Francescon, Co-Chief Executive Officer of the Company. "Building on this positive momentum, we increased our land position, improved the quality of our backlog and strengthened our capital resources to close out the full year 2015 on firm footing. So far in 2016, the market dynamics in our Colorado, Atlanta and Las Vegas markets are encouraging and our Central Texas operations continue to contribute favorably to our results. To that end, we are well positioned to deliver another consecutive year of profitable growth as we continue to execute on our strong pipeline of new community openings, pursue select land purchases, and capitalize on additional value-enhancing opportunities."

Fourth Quarter 2015 Results

Net income for the fourth quarter 2015 was $13.2 million, or $0.62 per share, compared to $7.2 million, or $0.34 per share, in the prior year quarter. The improvement in net income was primarily attributable to an increase in home sales revenues generated by a higher number of home deliveries and an improvement in homebuilding gross margin and SG&A as a percent of home sales revenue.

Home sales revenues for the fourth quarter 2015 were $204.5 million, compared to $134.1 million for the prior year quarter. The growth in home sales revenues was primarily due to home deliveries increasing 40% to 645 homes, compared to 462 homes in the prior year quarter. The average selling price of homes delivered was $317,083, compared to $290,236 in the prior year quarter, largely due to a shift in regional and product mix from new communities.

Home sales gross margin percentage in the fourth quarter 2015 was 20.4%, compared to 18.0% in the prior year quarter. Adjusted homebuilding gross margin percentage, excluding purchase price accounting and interest in cost of homes sales revenues was 22.0% compared to 21.0% in the prior year quarter. SG&A as a percent of home sales revenues was 10.7% compared to 11.8% in the prior year quarter, primarily as a result of higher home sales revenues, which more than offset an increase in personnel costs and additional investments to support a higher number of communities.

Net new home contracts in the fourth quarter 2015 increased to 455 homes, an increase of 24.7% compared to 365 homes in the prior year quarter, largely attributable to a higher number of average open communities and higher absorption pace. At the end of the fourth quarter 2015, the Company had 714 homes in backlog, representing $271.1 million of backlog dollar value, compared to 772 homes, representing $246.3 million of backlog dollar value in the prior year quarter.

Full Year 2015 Results

Net income for the full year 2015 was $39.9 million, or $1.88 per share, compared to $20.0 million, or $1.03 per share for the prior year. Home sales revenues for 2015 were $725.4 million, compared to $351.8 million for 2014. The increase in home sales revenues was primarily due to home deliveries increasing 130% to 2,401 homes. The average selling price of homes delivered was $302,140 compared to $336,351 in the prior year largely due to a shift in regional and product mix from new communities and acquisitions.

Homebuilding gross margin percentage in 2015 was 20.2%, compared to 21.4% in 2014. Adjusted homebuilding gross margin percentage, excluding purchase price accounting and interest in cost of home sales revenues, was 21.9% compared to 23.4% in the prior year. SG&A as a percent of home sales revenues was 12.1% compared to 13.3% in the prior year.

Net new home contracts in 2015 increased to 2,356 homes, an increase of 126.1%, compared to 1,042 homes in the prior year, largely attributable to a higher number of average open communities.

At the end of full year 2015, the Company had 94 open communities, an increase of 13.3%, compared to 83 open communities at the end of full year 2014.

Beginning in 2016 the Company has revised its open selling community count method to define an open selling community as any community that has had one new home contracted and more than five homes remaining to be contracted. Under the prior method, the Company defined a selling community as any community that had one new home contracted and more than five homes remaining to be delivered. The Company believes the revised method is consistent with our operations and a better reflection of activity in our markets.

Under the redefined tabulation of open communities, at the end of full year 2015, the Company had 88 open communities, an increase of 17.3 %, compared to 75 open communities at the end of full year 2014. In conjunction with the redefinition of open selling communities, the Company has posted a supplemental schedule on the Investors section of its website which reconciles the redefined open selling community count to the prior method for the last eight quarters through the fourth quarter 2015.

Balance Sheet and Liquidity

As of December 31, 2015, the Company had total assets of $917.7 million and inventories of $810.1 million. Liabilities totaled $508.3 million, which included $390.2 million of long-term debt. At December 31, 2015, the Company’s ratio of net debt to net capital was 46.9%.

In December 2015, the Company successfully amended and increased its unsecured revolving credit facility to $300 million with a $100 million accordion feature. As of December 31, 2015, the Company had $165 million of availability on the facility and the accordion was undrawn.

Full Year 2016 Outlook

David Messenger, Chief Financial Officer of the Company, commented, "We are optimistic on the prospects for continued growth in our overall business. Most of our housing markets continue to be supported by improving fundamentals including job gains, new household formations and strengthening regional economies. Based on our current market outlook, for the full year 2016 we expect our home deliveries to be in the range of 2,500 to 3,000 homes and our home sales revenues to be in the range of $800 million to $950 million, excluding the impact of any future acquisitions. At the end of full year 2016, we expect our active selling community count to be in the range of 80-85 communities."

Conference Call

The Company will host a webcast and conference call on Thursday, February 18, 2016 at 5:00 p.m. Eastern time, 3:00 p.m. Mountain time, to review the Company’s fourth quarter and full year 2015 results, discuss recent events and conduct a question-and-answer period. To participate in the call, please dial 877-705-6003 (domestic) or 201-493-6725 (international). The live webcast will be available at www.centurycommunities.com in the Investors section. A replay of the conference call will be available through March 18, 2016, by dialing 877-870-5176 (domestic) or 858-384-5517 (international) and entering the pass code 13628412.

About Century Communities

Founded in 2002, Colorado-based Century Communities is a builder of single-family homes, townhomes and flats in select major metropolitan markets in Colorado, Texas, Nevada, and Georgia. The Company offers a wide variety of product lines and is engaged in all aspects of homebuilding, including the acquisition, entitlement and development of land and the construction, marketing and sale of homes. Century Communities is a top-25 U.S. homebuilder based on homes delivered. To learn more about Century Communities please visit www.centurycommunities.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, as such, may involve known and unknown risks, uncertainties and assumptions. Forward-looking statements may be identified by the use of words such as "anticipate," "believe," "expect," "estimate," "plan," "outlook," and "project" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on historical information available at the time the statements are made and are based on management’s reasonable belief or expectations with respect to future events, and are subject to risks and uncertainties, many of which are beyond the Company’s control, that could cause actual performance or results to differ materially from the belief or expectations expressed in or suggested by the forward-looking statements. Forward-looking statements speak only as of the date on which they are made and the Company undertakes no obligation to update any forward-looking statement to reflect future events, developments or otherwise, except as may be required by applicable law. Investors are referred to the Company’s Annual Report on Form 10-K for additional information regarding the risks and uncertainties that may cause actual results to differ materially from those expressed in any forward-looking statement.

 
                                                                                                                                                              Century Communities, Inc.
                                                                                                                                                        Consolidated Statements of Operations
                                                                                                                                                                     (Unaudited)
 
(in thousands, except share and per share amounts)
 
                                                                                                    Three Months Ended                                                                                                                   Year Ended
                                                                                                                          December 31,                                                                                                                                        December 31,
                                                                 -------------------------------------------------------------------------------------------------------------------------------                     -------------------------------------------------------------------------------------------------------------------------------
                                                                                         2015                                                   2014                                                                      2015                                                   2014
                                                                 -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------
Revenue
 Home sales revenues                                                                $    204,519                                                              $    134,089                                                              $    725,437                                                              $    351,823
 Land sales revenues                                                                         778                                                                     4,800                                                                     3,405                                                                     4,800
 Golf course and other revenue                                            968                               2,018                               5,647                               5,769  
                                                                 -------------------- -------------------------------                      -------------------- ---------- --------------------                      -------------------- -------------------------------                      -------------------- ---------- --------------------
Total revenue                                                                            206,265                                                                   140,907                                                                   734,489                                                                   362,392
Costs and expenses
 Cost of home sales revenues                                                             162,720                                                                   110,019                                                                   579,203                                                                   276,386
 Cost of land sales revenues                                                                 780                                                                     1,808                                                                     3,395                                                                     1,808
 Cost of golf course and other revenue                                                       823                                                                     1,971                                                                     5,037                                                                     6,301
 Selling, general, and administrative                                  21,921                              15,889                              87,840                              46,795  
                                                                 -------------------- -------------------------------                      -------------------- ---------- --------------------                      -------------------- -------------------------------                      -------------------- ---------- --------------------
Total operating costs and expenses                                    186,244                             129,687                             675,475                             331,290  
                                                                 -------------------- -------------------------------                      -------------------- ---------- --------------------                      -------------------- -------------------------------                      -------------------- ---------- --------------------
Operating income                                                                          20,021                                                                    11,220                                                                    59,014                                                                    31,102
Other income (expense):
 Interest income                                                                              41                                                                        95                                                                       129                                                                       362
 Interest expense                                                                             (2 )                                                                     (13 )                                                                     (10 )                                                                     (26 )
 Acquisition expense                                                                        (153 )                                                                    (490 )                                                                    (491 )                                                                  (1,414 )
 Other income                                                                                476                                                                       150                                                                     1,535                                                                       736
 Gain (loss) on disposition of assets                                      22                                  55                                 128                                 199  
                                                                 -------------------- -------------------------------                      -------------------- ---------- --------------------                      -------------------- -------------------------------                      -------------------- ---------- --------------------
Income before income tax expense                                                          20,405                                                                    11,017                                                                    60,305                                                                    30,959
Income tax expense                                                      7,247                               3,828                              20,415                              10,937  
                                                                 -------------------- -------------------------------                      -------------------- ---------- --------------------                      -------------------- -------------------------------                      -------------------- ---------- --------------------
Net income                                                                          $     13,158                                           $      7,189                                           $     39,890                                           $     20,022  
                                                                 ==================== ===============================                      ==================== ========== ====================                      ==================== ===============================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                     
Earnings per share:
Basic and diluted                                                                   $       0.62                                                              $       0.34                                                              $       1.88                                                              $       1.03
Weighted average common shares outstanding:
Basic and diluted                                                                     20,607,191                                                                20,978,802                                                                20,569,012                                                                19,226,504
                                                                                                                                                                                                                                                                                                                                

Financial and operating results as of and for the three months and year ended December 31, 2014 include the results of operations from our acquisitions of Las Vegas Land Holdings, LLC, Grand View Builders and Peachtree Communities Group Inc., from the date of acquisition, April 1, 2014, August 12, 2014 and November 13, 2014, respectively. Subsequent to the acquisitions, Las Vegas Land Holdings, LLC, Grand View Builders, and Peachtree Communities Group Inc., comprise our Nevada, Houston, and Atlanta operating segments.

 
                                                                                   Century Communities, Inc.
                                                                                  Consolidated Balance Sheets
                                                                                          (Unaudited)
 
(in thousands, except share amounts)
 
                                                                                    December 31,                             December 31,
                                                                                                           2015                                                        2014
                                                                                           ------------------------------------                     ------------------------------------------
Assets
Cash and cash equivalents                                                                                     $         29,287                                         $               33,462
Accounts receivable                                                                                                     17,058                                                         13,799
Inventories                                                                                                            810,137                                                        556,323
Prepaid expenses and other assets                                                                                       26,735                                                         23,433
Property and equipment, net                                                                                              8,375                                                         12,471
Deferred tax asset, net                                                                                         --                                                          1,359
Amortizable intangible assets, net                                                                                       4,784                                                          8,632
Goodwill                                                                                             21,365                                      21,137
                                                                                           -------------------- --------------                      -------------------- --------------------
Total assets                                                                                                  $        917,741                                         $              670,616
                                                                                           ==================== ==============                      ==================== ====================
Liabilities and stockholders’ equity
Liabilities:
 Accounts payable                                                                                             $         10,967                                         $               17,135
 Accrued expenses and other liabilities                                                                                106,777                                                         64,029
 Deferred tax liability, net                                                                                               275                                                 --
 Notes payable and revolving line of credit                                                         390,243                                     224,247
                                                                                           -------------------- --------------                      -------------------- --------------------
Total liabilities                                                                                   508,262                                     305,411
                                                                                           -------------------- --------------                      -------------------- --------------------
Stockholders’ equity:
 Preferred stock, $0.01 par value, 50,000,000 shares authorized, none                                           --                                                 --
 outstanding
                                                                                                                           213                                                            209
 Common stock, $0.01 par value, 100,000,000 shares authorized,
 21,303,702 and 20,875,547 shares
 issued and outstanding at
 December 31, 2015 and 2014, respectively
 Additional paid-in capital                                                                                            340,953                                                        336,573
 Retained earnings                                                                                   68,313                                      28,423
                                                                                           -------------------- --------------                      -------------------- --------------------
Total stockholders’ equity                                                                          409,479                                     365,205
                                                                                           -------------------- --------------                      -------------------- --------------------
Total liabilities and stockholders’ equity                                                                    $        917,741                                         $              670,616
                                                                                           ==================== ==============                      ==================== ====================
                                                                                                                                                                          
 
                                                                                                                                                                                                Century Communities, Inc.
                                                                                                                                                                                              Homebuilding Operational Data
 
Net New Home Contracts
 
                                                                           Three Months Ended                                                                                                                            Year Ended
                                                                                                                                                          December 31,                                                                                                                                                                    December 31,
                                                                                                  ----------------------------------------------------------------------------------------------------------------------------                                          ------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  2015     2014                % Change                                                      2015      2014                         % Change
                                                                                                  ----                                           ----                                           ------------------------------                                          -----                                           -----                                           ------------------------------------------------
Atlanta                                                                                            228                                            129                                            76.7                      %                                            1,134                                             129                                           779.1   %
Central Texas                                                                                       38                                             27                                            40.7                      %                                              180                                             133                                            35.3                      %
Colorado                                                                                           125                                            120                                             4.2                      %                                              680                                             539                                            26.2                      %
Houston                                                                                             19                                             47                                           (59.6 )                    %                                              104                                              56                                            85.7                      %
Nevada                                                                                              45                                             42                                             7.1   %                                              258                                             185                                            39.5   %
                                                                                                  ----                                           ----                                           ----- -------------------- --                                           -----                                           -----                                           ----- -------------------- --------------------
Total                                                                                              455                                            365                                            24.7   %                                            2,356                                           1,042                                           126.1   %
                                                                                                  ====                                           ====                                           ===== ==================== ==                                           =====                                           =====                                           ===== ==================== ====================
                                                                                                                                                                                                                                                                                                                                                                                                    
 
Home Deliveries
 
                                                                                                                         Three Months Ended December 31,
                                            -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              2015                                       2014                                                                  % Change
                                            -----------------------------------------                     -----------------------------------------                     ---------------------------------------------------------------------------------------------------
                                             Homes   Average Sales                      Homes   Average Sales                                  Homes                                Average Sales
                                                                            Price                                                         Price                                                                                                  Price
                                            -----                      ------------                       -----                      ------------                       ---------------------------                        ---------------------------------------------
                                                                                                                                                                         
Atlanta                                       331                           $  245.1                        173                           $  212.3                       91.3                      %                        15.4                      %
Central Texas                                  53                           $  461.5                         37                           $  354.0                       43.2                      %                        30.4                      %
Colorado                                      163                           $  414.5                        138                           $  379.1                       18.1                      %                         9.3                      %
Houston                                        40                           $  284.7                         45                           $  224.3                      (11.1 )                    %                        26.9                      %
Nevada                                         58                           $  344.7                         69                           $  316.7                      (15.9 )                    %                         8.8   %
                                            -----                      ------ ------                      -----                      ------ ------                      ----- -------------------- --                      ----- -------------------- --------------------
Total / Weight Average                        645                           $  317.1                        462                           $  290.2                       39.6   %                         9.3   %
                                            =====                      ====== ======                      =====                      ====== ======                      ===== ==================== ==                      ===== ==================== ====================
                                                                                                                                                                                                                                                       
                                                                                                                                                Year Ended December 31,
                                            -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              2015                                                          2014                                                                                     % Change
                                            -----------------------------------------                     -----------------------------------------                     ---------------------------------------------------------------------------------------------------
                                             Homes                      Average Sales                      Homes                      Average Sales                                  Homes                                                   Average Sales
                                                                            Price                                                         Price                                                                                                  Price
                                            -----                      ------------                       -----                      ------------                       ---------------------------                        ---------------------------------------------
                                                                                                                                                                         
Atlanta                                     1,174                           $  229.3                        173                           $  212.3                      578.6                      %                         8.0                      %
Central Texas                                 162                           $  460.4                        134                           $  416.8                       20.9                      %                        10.5                      %
Colorado                                      636                           $  407.6                        449                           $  393.8                       41.6                      %                         3.5                      %
Houston                                       167                           $  228.9                         81                           $  215.5                      106.2                      %                         6.2                      %
Nevada                                        262                           $  321.2                        209                           $  310.9                       25.4   %                         3.3   %
                                            -----                      ------ ------                      -----                      ------ ------                      ----- -------------------- --                      ----- -------------------- --------------------
Total / Weight Average                      2,401                           $  302.1                      1,046                           $  336.4                      129.5   %                       (10.2 )                    %
                                            =====                      ====== ======                      =====                      ====== ======                      ===== ==================== ==                      ===== ==================== ====================
                                                                                                                                                                                                                                                       
 
                                                                                           Century Communities, Inc.
                                                                                         Homebuilding Operational Data
 
Selling Communities
 
                                           Revised Definition                                                           Previous Definition
                                                              As of December 31,                                                                              As of December 31,
                                   ------------------------------------------------------------------------                     ------------------------------------------------------------------------------
                                   2015   2014         % Change                           2015   2014            % Change
                                   ----                      ----                      --------------------                     ----                      ----                      --------------------------
Atlanta                              33                        26                                26.9    %                        34                        29                      17.2                    %
Central Texas                        14                        14                      --    %                        15                        14                       7.1                    %
Colorado                             27                        25                                 8.0    %                        31                        29                       6.9                    %
Houston                               9                         7                                28.6    %                         9                         8                      12.5                    %
Nevada                                5                         3                                66.7    %                         5                         3                      66.7                    %
                                   ----                      ----                      -------------- ----                      ----                      ----                      ---- --------------------
Total                                88                        75                                17.3    %                        94                        83                      13.3                    %
                                   ====                      ====                      ============== ====                      ====                      ====                      ==== ====================
                                                                                                                                                                                          
 
Backlog
 
                                                                                                                                                                                     As of December 31,
                                      ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                        2015                                                                                                      2014                                                                                              % Change
                                      --------------------------------------------------------------------------------------------------------                     --------------------------------------------------------------------------------------------------------                     --------------------------------------------------------------------------------------------
                                       Homes          Dollar Value                     Average                                Homes             Dollar                        Average                                  Homes    Dollar Value             Average
                                                                                                                           Sales Price                                                                    Value                                         Sales Price                                                                                                      Sales Price
                                      -----                      ---------------------------                       -------------------------                       -----                      ---------------------------                       -------------------------                       --------                       -----------                       -------------------------
Atlanta                                 283                                         $  74,249                                         $ 262.4                        353                                         $  79,084                                         $ 224.0                      (19.8) %                        (6.1) %                           17.1 %
Central Texas                           109                                            52,705                                           483.5                         91                                            41,112                                           451.8                        19.8 %                         28.2 %                            7.0 %
Colorado                                262                                           123,853                                           472.7                        218                                            96,150                                           441.1                        20.2 %                         28.8 %                            7.2 %
Houston                                  31                                            10,308                                           332.5                         77                                            20,100                                           261.0                      (59.7) %                       (48.7) %                           27.4 %
Nevada                                   29                         10,023                        345.6                         33                          9,881                        299.4                      (12.1) %                          1.4 %                           15.4 %
                                      -----                      -------------------- -------                      -------------------- -----                      -----                      -------------------- -------                      -------------------- -----                      ------ --                      ------ -----                      ----- --------------------
Total / Weighted                        714                                         $ 271,138                                         $ 379.7                        772                                         $ 246,327                                         $ 319.1                       (7.5) %                         10.1 %                           19.0 %
Average
                                      =====                      ==================== =======                      ==================== =====                      =====                      ==================== =======                      ==================== =====                      ====== ==                      ====== =====                      ===== ====================
                                                                                                                                                                                                                                                                                                                                                                        
 
Lot Inventory
 
                                                                                                                                             As of December 31,
                                   ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    2015                                                                  2014                                                                          % Change
                                   ----------------------------------------------------------------------                     ------------------------------------------------------------------                     ------------------------------------------------------------------------------------------
                                    Owned    Controlled      Total                       Owned  Controlled    Total                         Owned    Controlled              Total
                                   -----                      --------------                      ------                      -----                      ----------                      ------                      ----------                     ----------                     ----------------------------
Atlanta                            2,667                               2,575                       5,242                        686                           1,735                       2,421                       288.8  %                         48.4 %                       116.5 %
Central Texas                      1,222                                 348                       1,570                      1,089                           1,195                       2,284                        12.2  %                       (70.9) %                      (31.3) %
Colorado                           2,931                               1,022                       3,953                      3,349                             530                       3,879                      (12.5)  %                         92.8 %                         1.9 %
Houston                              271                                 220                         491                        233                             668                         901                        16.3  %                       (67.1) %                      (45.5) %
Nevada                             1,904                      --                       1,904                      1,644                             334                       1,978                        15.8  %                      (100.0) %                       (3.7) %
                                   -----                      --------------                      ------                      -----                      ----------                      ------                      ------ --                      ------- -                      ------ --------------------
Total                              8,995                               4,165                      13,160                      7,001                           4,462                      11,463                        28.5  %                        (6.7) %                        14.8 %
                                   =====                      ==============                      ======                      =====                      ==========                      ======                      ====== ==                      ======= =                      ====== ====================
                                                                                                                                                                                                                                                                                           
 
                                                                                                                                                                                              Century Communities, Inc.
                                                                                                                                                                                                 Earnings Per Share
                                                                                                                                                                                                     (Unaudited)
 
(in thousands, except share and per share amounts)
 
                                                                                                                     Three Months Ended December 31,                                                                                                          Year Ended December 31,
                                                                                        -------------------------------------------------------------------------------------------------------------------------------                                                               -------------------------------------------------------------------------------------------------------------------------------
                                                                                                                2015                                                   2014                                                                                                                2015                                                   2014
                                                                                        --------------------------------------------------                        --------------------------------------------------                                                                  --------------------------------------------------                        --------------------------------------------------
Numerator
Net income                                                                                                 $     13,158                                                              $      7,189                                                                                                        $     39,890                                                              $     20,022
Less: Undistributed earnings allocated to participating securities                              (431 )                                                 (123 )                                                                                         (1,323 )                                                 (296 )
                                                                                        -------------------- ---------- --------------------                      -------------------- ---------- --------------------                                                                -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Net income allocable to common stockholders                                                                $     12,727                                           $      7,066                                                                                     $     38,567                                           $     19,726  
                                                                                        ==================== ========== ====================                      ==================== ========== ====================                                                                ==================== ========== ====================                      ==================== ========== ====================
Denominator
Weighted average common shares outstanding - basic and                                                       20,607,191                                                                20,978,802                                                                                                          20,569,012                                                                19,226,504
diluted:
Earnings per share:
Basic and diluted                                                                                          $       0.62                                                              $       0.34                                                                                                        $       1.88                                                              $       1.03
                                                                                                                                                                                                                                                                                                                                                                                                 

Century Communities, Inc. Reconciliation of Non-GAAP Financial Measures (Unaudited)

Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory is not a measurement of financial performance under United States generally accepted accounting principles; however, the Company’s management believes that this information is meaningful as it isolates the impact that indebtedness and acquisition costs have on homebuilding gross margin and permits the Company’s stockholders to make better comparisons with the Company’s competitors, who adjust gross margins in a similar fashion. This non-GAAP financial measure should not be used as a substitute for the Company’s operating results for the three months and year ended December 31, 2015. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.

 
Gross Margin from Home Sales Excluding Interest and Purchase
Price Accounting for Acquired Work in Process
Inventory
 
(in thousands)
 
                                                                                                                                         Three Months Ended December 31,
                                                                                            ---------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                        2015                    %                   2014                            %
                                                                                            -----------------------------                     -----------                     -----------------------------                     ---------------------------
                                                                                                                                                                                                                                       
Home sales revenues                                                                                            $ 204,519                      100.0 %                                            $ 134,089                      100.0 %
Cost of home sales revenues                                                                   162,720                       79.6 %                           110,019                       82.0 %
                                                                                            -------------------- -------                      ----- ----                      -------------------- -------                      ----- --------------------
Gross margin from home sales                                                                                      41,799                       20.4 %                                               24,070                       18.0 %
 Add: Interest in cost of home sales revenues                                                   3,156                        1.5 %                             1,083                        0.8 %
                                                                                            -------------------- -------                      ----- ----                      -------------------- -------                      ----- --------------------
Adjusted homebuilding gross margin excluding interest                                                             44,955                       22.0 %                                               25,153                       18.8 %
                                                                                                                                                                                                                                       
 Add: Purchase price accounting for acquired work in process inventory                             28                        0.0 %                             2,965                        2.2 %
                                                                                            -------------------- -------                      ----- ----                      -------------------- -------                      ----- --------------------
Adjusted homebuilding gross margin excluding interest and purchase                                             $  44,983                       22.0 %                                            $  28,118                       21.0 %
price
accounting for acquired work in process inventory
                                                                                            ==================== =======                      ===== ====                      ==================== =======                      ===== ====================
 
                                                                                                                                                                Year Ended December 31,
                                                                                            ---------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                        2015                                       %                                      2014                                               %
                                                                                            -----------------------------                     -----------                     -----------------------------                     ---------------------------
                                                                                                                                                                                                                                       
Home sales revenues                                                                                            $ 725,437                      100.0 %                                            $ 351,823                      100.0 %
Cost of home sales revenues                                                                   579,203                       79.8 %                           276,386                       78.6 %
                                                                                            -------------------- -------                      ----- ----                      -------------------- -------                      ----- --------------------
Gross margin from home sales                                                                                     146,234                       20.2 %                                               75,437                       21.4 %
 Add: Interest in cost of home sales revenues                                                  10,082                        1.4 %                             2,366                        0.7 %
                                                                                            -------------------- -------                      ----- ----                      -------------------- -------                      ----- --------------------
Adjusted homebuilding gross margin excluding interest                                                            156,316                       21.5 %                                               77,803                       22.1 %
 Add: Purchase price accounting for acquired work in process inventory                          2,673                        0.4 %                             4,697                        1.3 %
                                                                                            -------------------- -------                      ----- ----                      -------------------- -------                      ----- --------------------
Adjusted homebuilding gross margin excluding interest and purchase                                             $ 158,989                       21.9 %                                            $  82,500                       23.4 %
price
accounting for acquired work in process inventory
                                                                                            ==================== =======                      ===== ====                      ==================== =======                      ===== ====================
                                                                                                                                                                                                                                       

Century Communities, Inc. Reconciliation of Non-GAAP Financial Measures (Unaudited)

The following table presents adjusted EBITDA for the three months and year ended December 31, 2015. Adjusted EBITDA is a non-GAAP financial measure we use as a supplemental measure in evaluating operating performance. We define adjusted EBITDA as consolidated net income before (i) income tax expense, (ii) interest in cost of home sales revenues, (iii) other interest expense, (iv) depreciation and amortization expense and, (v) adjustments resulting from the application of purchase accounting for acquired work in process inventory related to business combinations. We believe adjusted EBITDA provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, and items considered to be non-recurring. Accordingly, our management believes that this measurement is useful for comparing general operating performance from period to period. Adjusted EBITDA should be considered in addition to, and not as a substitute for, consolidated net income in accordance with GAAP as a measure of performance. Our presentation of adjusted EBITDA should not be construed as an indication that our future results will be unaffected by unusual or non-recurring items. Our adjusted EBITDA is limited as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP.

 
Adjusted EBITDA
 
(in thousands)
 
                                                                                                      Three Months Ended December 31,                                                                                                                            Year Ended December 31,
                                                             ------------------------------------------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         2015                          2014                                    % Change                                                       2015                          2014                                   % Change
                                                             ----------------------------                     ----------------------------                     ----------------------------------------------------                     ----------------------------                     ----------------------------                     ---------------------------------------------------
                                                                                                                                                                                                                                                                                                                        
Net income                                                                      $ 13,158                                         $  7,189                                            83.0                      %                                           $ 39,890                                         $ 20,022                                            99.2                      %
Income tax expense                                                                 7,247                                            3,828                                            89.3                      %                                             20,415                                           10,937                                            86.7                      %
Interest in cost of home sales revenues                                            3,157                                            1,083                                           191.5                      %                                             10,082                                            2,366                                           326.1                      %
Interest expense                                                                       2                                               13                                           (84.6 )                    %                                                 10                                               26                                           (61.5 )                    %
Depreciation and amortization expense                           1,201                         1,151                          4.3   %                           4,713                         2,941                         60.3   %
                                                             -------------------- ------                      -------------------- ------                      -------------------- ----- -------------------- ---                      -------------------- ------                      -------------------- ------                      -------------------- ----- -------------------- --
EBITDA                                                                            24,765                                           13,264                                            86.7                      %                                             75,110                                           36,292                                           107.0                      %
Purchase price accounting for acquired                             28                         2,965                        (99.1 )                    %                           2,673                         4,697                        (43.1 )                    %
work in process
inventory
                                                             -------------------- ------                      -------------------- ------                      -------------------- ----- -------------------- ---                      -------------------- ------                      -------------------- ------                      -------------------- ----- -------------------- --
Adjusted EBITDA                                                                 $ 24,793                                         $ 16,229                         52.8   %                                           $ 77,783                                         $ 40,989                         89.8   %
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http://cts.businesswire.com/ct/CT?id=bwnews&sty=20160218006546r1&sid=cmtx6&distro=nx&lang=en

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SOURCE: Century Communities, Inc.

Century Communities, Inc. 
Investor Relations: 
303-268-8398 
InvestorRelations@CenturyCommunities.com


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