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Century Communities, Inc$29.55$.301.03%

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 Century Communities Reports Second Quarter 2017 Results
   Thursday, August 03, 2017 4:05:07 PM ET

--- Home Sales Revenues increased 12% to $287.6 Million -

--- Net New Home Contracts Increased 18% to 1,021 Contracts -

--- Planned Business Combination with UCP, Inc. to Create a Leading U.S. Homebuilding Platform Expected to be Completed on August 4, 2017 -

Century Communities, Inc. (CCS ), a top-20 U.S. homebuilder of single-family homes, townhomes and flats in select markets, today announced financial results for its second quarter ending June 30, 2017. The Company has posted supplementary materials to its investor relations website.

Second Quarter 2017 Highlights Compared to Second Quarter 2016

-- Net income rose 13% to $14.8 million, or $0.66 per share

-- Net new home contracts increased 18% to 1,021 contracts

-- Backlog improved 28% to 1,366 homes

-- Backlog value increased 29% to $522.6 million

-- Home sales revenues increased 12% to $287.6 million

-- Average home sales price increased 14% to $381,900

-- Adjusted homebuilding gross margin increased 12% to $60.7 million

-- Selling, general & administrative expense ("SG&A") as a percent of home sales revenues improved by 30 basis points to 11.9%

-- Pre-tax income increased 21% to $23.1 million

-- Adjusted EBITDA was up 24% to $31.6 million

-- Completed successful offering of $400 million of 5.875% senior notes due 2025

Dale Francescon, Co-Chief Executive Officer of the Company, stated, "During the second quarter of 2017 we had significant growth in new contracts and home sales revenues while making further progress on a number of previously announced initiatives. We experienced considerable operating momentum and price gains as we capitalized on favorable demand trends in our key markets, which allowed us to produce another quarter of strong earnings. With the acquisition of UCP in the final stages of completion, we are eager to further build Century into an even larger and more profitable homebuilder. As we look forward, we have a three pronged focus to enhance our returns on equity, which includes rapidly integrating UCP with Century, deploying capital on sound investments at attractive paybacks, and controlling costs to deliver stronger margins across our expanded footprint. With these objectives in place, we look forward to advancing our long term growth strategy of our combined business."

Rob Francescon, Co-Chief Executive Officer of the Company, stated, "Our 18% growth in new contracts to a record 1,021 sales, coupled with our 28% increase in backlog to 1,366 homes, reinforces our positive view on the homebuilding environment. During the second quarter, we recorded our first sales in our newest market, Charlotte, and our Utah and financial services divisions both achieved profitability. We are encouraged by the trajectory of our multi-market strategy and are poised for additional success. The planned addition of UCP’s West and Southeast markets will provide us with exceptional land positions in some of the most attractive and top U.S. homebuilding markets. On our expanded geographic footprint, we will continue to focus on strengthening our presence in vibrant markets to grow revenue and deliver incremental profitability. Our enhanced purchasing advantages, scale and opportunity to share best practices provide us with additional pathways to improve our financial performance and returns on equity."

Second Quarter 2017 Resultsi"

Net income for the second quarter 2017 was $14.8 million, or $0.66 per share, compared to $13.1 million, or $0.62 per share, for the prior year quarter. The improvement in net income was primarily attributable to an increase in home sales revenues and homebuilding gross margin, along with lower SG&A as a percent of home sales revenues.i"

Home sales revenues for the second quarter 2017 increased 11.8% to $287.6 million, compared to $257.2 million for the prior year quarter. The growth in home sales revenues was primarily due to a higher average sales price of home deliveries of $381,900, compared to $334,900 in the prior year quarter. Deliveries in the second quarter of 2017 were 753 homes compared to 768 homes for the prior year quarter.

i"Adjusted homebuilding gross margin percentage, excluding interest and purchase price accounting, was stable at 21.1% in the second quarter 2017 compared to the prior year quarter. Homebuilding gross margin percentage in the second quarter 2017 was 18.7%, as compared to 19.2% in the prior year quarter as a result of increased financing costs. SG&A as a percent of home sales revenues improved to 11.9%, from 12.2% in the prior year quarter.

Net new home contracts in the second quarter 2017 increased to 1,021 homes, an increase of 17.5%, compared to 869 homes in the prior year quarter, largely attributable to stronger demand trends in most divisions, led by our Atlanta and Nevada markets, driving an overall increase in absorption rates. At the end of the second quarter 2017, the Company had 1,366 homes in backlog, representing $522.6 million of backlog dollar value, compared to 1,070 homes, representing $406.7 million of backlog dollar value in the prior year quarter.i"

Business Combination with UCP

On April 11, 2017, the Company announced that it had entered into a definitive agreement pursuant to which UCP, Inc. (UCP ) will be merged into the Company in a transaction with an aggregate value of approximately $360 million, including the payment of approximately $153 million of existing UCP indebtedness. The transaction has been unanimously approved by the board of directors of both Century and UCP and was also approved by UCP shareholders on August 1, 2017.

The addition of UCP will expand Century’s reach into the states of California and Washington while reinforcing Century’s presence in the Southeast. The combined company will operate in 10 states, 17 markets and 111 communities, with revenues of approximately $1.5 billion and inventories of $1.3 billion (calculated on a pro forma basis as of and for the twelve months ended June 30, 2017, respectively). Together, Century and UCP will benefit from increased scale through a geographically diverse portfolio with essentially no overlap, which provides for a seamless integration on an enhanced platform. The merger is expected to be accretive to Century’s 2018 earnings per share as a result of cost synergies and economies of scale.

Upon completion of the merger, each share of UCP Class A common stock outstanding immediately prior to the closing will be converted into the right to receive $5.32 in cash and 0.2309 of a newly issued share of Century common stock. Approximately 4.24 million shares of Century common stock are expected to be issued in connection with the transaction, resulting in a broadening of Century’s investor base and an increase in share liquidity. Century stockholders would own, on a pro forma basis, approximately 84% of the combined company. The transaction is expected to close on Friday, August 4, 2017, subject to the satisfaction of customary closing conditions.

Balance Sheet and Liquidity

In May 2017, the Company successfully completed a private offering of $400 million in aggregate principal amount of 5.875% Senior Notes due 2025. The Company used a portion of the $395 million of net proceeds from the offering for the repayment of outstanding indebtedness under its revolving credit facility, with the remainder of the net proceeds intended for general corporate purposes, including the funding of the planned merger transaction with UCP. During the second quarter of 2017, the Company issued approximately 382,719 shares under its ATM Program for $9.6 million, or $25.16 per share.

As of June 30, 2017, the Company had total assets of $1.4 billion and inventories of $927.0 million. Liabilities totaled $883.7 million, which included $776.8 million of long-term debt. As of June 30, 2017, the Company had $400.0 million of availability under its credit facility.

Full Year 2017 Outlooki"

David Messenger, Chief Financial Officer of the Company, commented, "We are excited with the expanding scale of our business across an even more diverse footprint. Looking at full year 2017, the stability provided by our expected national scale gives us confidence and enhanced visibility as we look forward. Our updated expectations for our combined business include a partial third quarter from UCP commencing with operations as of the expected August 4, 2017 closing date and a full quarter of results from UCP in the fourth quarter. Based on our current market outlook, we expect our full year 2017 home deliveries to be in the range of 3,500 to 3,800 homes and our full year 2017 home sales revenues to be in the range of $1.3 billion to $1.5 billion. We expect our active selling community count to be in the range of 110 to 120 communities at December 31, 2017. We are extremely pleased with our operating and financial progress to date, which has provided us with an exceptional platform to benefit from the exciting prospects for our combined business in years to come."

Conference Call

The Company will host a webcast and conference call on Thursday, August 3, 2017 at 5:00 p.m. Eastern time, 3:00 p.m. Mountain time, to review the Company’s second quarter 2017 results, discuss recent events and conduct a question-and-answer period. To participate in the call, please dial 855-327-6837 (domestic) or 631-891-4304 (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 September 3, 2017, by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the pass code 10003342.

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, Georgia, Nevada, Texas, Utah, and North Carolina. 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. The Company also offers title and lending services in select markets through its Parkway Title and Inspire Home Loan subsidiaries. Century Communities is a top-20 U.S. homebuilder based on homes delivered. To learn more about Century Communities please visit www.centurycommunities.com.i"

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.
                                                                                                                                                         Condensed Consolidated Statements of Operations
                                                                                                                                                                           (Unaudited)
                                                                                                                                                       (in thousands, except share and per share amounts)
 
                                                                                                       Three Months Ended June 30,                                                                                                           Six Months Ended June 30,
                                                                      -----------------------------------------------------------------------------------------------------------------------------------                     -----------------------------------------------------------------------------------------------------------------------------------
                                                                                    2017                                  2016                                                     2017                                  2016                 
                                                                      ----------------------------------------------------                      --------------------------------------------------------                      ----------------------------------------------------                      --------------------------------------------------------
Revenues
 Home sales revenues                                                                     $    287,588                                                              $        257,179                                                              $    514,008                                                              $        438,260
 Land sales and other revenues                                               2,493                                   2,463                               4,389                                   5,478  
                                                                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------
                                                                                              290,081                                                                       259,642                                                                   518,397                                                                       443,738
Financial services revenue                                                   1,743                          --                               1,743                          --  
                                                                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------
   Total revenues                                                                             291,824                                                                       259,642                                                                   520,140                                                                       443,738
Homebuilding Cost of Revenues
 Cost of home sales revenues                                                                 (233,888 )                                                                    (207,883 )                                                                (416,212 )                                                                    (352,236 )
 Cost of land sales and other revenues                                      (1,746 )                                                   (1,471 )                                               (2,890 )                                                   (4,013 )
                                                                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------
                                                                                             (235,634 )                                                                    (209,354 )                                                                (419,102 )                                                                    (356,249 )
 Financial services costs                                                                      (1,445 )                                                              --                                                                    (2,199 )                                                              --
 Selling, general, and administrative                                                         (34,220 )                                                                     (31,383 )                                                                 (67,432 )                                                                     (56,568 )
 Acquisition expense                                                                             (916 )                                                                        (243 )                                                                  (1,439 )                                                                        (413 )
 Equity in income of unconsolidated subsidiaries                                                2,676                                                                --                                                                     3,931                                                                --
 Other income (expense)                                                        824                                     435                               1,261                                   1,018  
                                                                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------
Income before income tax expense                                                               23,109                                                                        19,097                                                                    35,160                                                                        31,526
Income tax expense                                                          (8,278 )                                                   (5,955 )                                              (11,530 )                                                  (10,401 )
                                                                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------                      -------------------- ---------- --------------------                      -------------------- -------------- --------------------
Net income                                                                               $     14,831                                           $         13,142                                           $     23,630                                           $         21,125  
                                                                      ==================== ========== ====================                      ==================== ============== ====================                      ==================== ========== ====================                      ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                              
Earnings per share:
Basic                                                                                    $       0.67                                                              $           0.62                                                              $       1.07                                                              $           1.00
Diluted                                                                                  $       0.66                                                              $           0.62                                                              $       1.06                                                              $           1.00
Weighted average common shares outstanding:
Basic                                                                                      22,146,124                                                                    20,649,910                                                                21,814,860                                                                    20,628,598
Diluted                                                                                    22,366,077                                                                    20,747,312                                                                22,029,962                                                                    20,686,697
                                                                                Century Communities, Inc.
                                                                          Condensed Consolidated Balance Sheets
                                                                                       (Unaudited)
                                                                          (in thousands, except share amounts)
 
                                                                                      June 30,                            December 31,
                                                                                                           2017                                                     2016
                                                                                           ------------------------------------                     ------------------------------------
Assets
Cash and cash equivalents                                                                                     $        336,786                                         $         29,450
Cash held in escrow                                                                                                     25,980                                                   20,044
Accounts receivable                                                                                                      8,209                                                    5,729
Inventories                                                                                                            926,992                                                  857,885
Mortgage loans held for sale                                                                                            11,235                                           --
Prepaid expenses and other assets                                                                                       42,220                                                   40,457
Property and equipment, net                                                                                             12,141                                                   11,412
Investment in unconsolidated subsidiaries                                                                               18,356                                                   18,275
Amortizable intangible assets, net                                                                                       2,222                                                    2,911
Goodwill                                                                                             21,365                                21,365
                                                                                           -------------------- --------------                      -------------------- --------------
Total assets                                                                                                  $      1,405,506                                         $      1,007,528
                                                                                           ==================== ==============                      ==================== ==============
Liabilities and stockholders’ equity
Liabilities:
 Accounts payable                                                                                             $          4,324                                         $         15,708
 Accrued expenses and other liabilities                                                                                 91,832                                                   62,314
 Deferred tax liability, net                                                                                               123                                                    1,782
 Senior notes payable                                                                                                  776,849                                                  259,088
 Revolving line of credit                                                                                       --                                                  195,000
 Mortgage repurchase facility                                                                        10,551                        --
                                                                                           -------------------- --------------                      -------------------- --------------
Total liabilities                                                                                   883,679                               533,892
                                                                                           -------------------- --------------                      -------------------- --------------
Stockholders’ equity:
 Preferred stock, $0.01 par value, 50,000,000 shares authorized, none                                           --                                           --
 outstanding
 Common stock, $0.01 par value, 100,000,000 shares authorized,                                                             226                                                      216
 22,648,968 and 21,620,544 shares issued and outstanding at June 30,
 2017 and December 31, 2016, respectively
 Additional paid-in capital                                                                                            380,118                                                  355,567
 Retained earnings                                                                                  141,483                               117,853
                                                                                           -------------------- --------------                      -------------------- --------------
Total stockholders’ equity                                                                          521,827                               473,636
                                                                                           -------------------- --------------                      -------------------- --------------
Total liabilities and stockholders’ equity                                                                    $      1,405,506                                         $      1,007,528
                                                                                           ==================== ==============                      ==================== ==============
                                                                                       Century Communities, Inc.
                                                                                     Homebuilding Operational Data
                        
Net New Home Contracts
                                                                                             Three Months Ended
                                                                                                                     June 30,
                                            -----------------------------------------------------------------------------------------------------------------------------------------------------------
                                             2017          2016                               % Change
                                            -----                                           --------------                                           --------------------------------------------------
Atlanta                                       443                                                      373                                              18.8                                         %
Central Texas                                  72                                                       71                                               1.4                                         %
Charlotte                                       3                                           --                                                NM
Colorado                                      223                                                      224                                              (0.4 )                                       %
Houston                                        40                                                       44                                              (9.1 )                                       %
Nevada                                        205                                                      155                                              32.3                                         %
Utah                                           35                                                        2                                           1,650.0                      %
                                            -----                                           --------------                                           ------- -------------------- --------------------
Total                                       1,021                                                      869                                              17.5                      %
                                            =====                                           ==============                                           ======= ==================== ====================
                                                                                                                                                                                   
                                                                                                                 Six Months Ended
                                                                                                                     June 30,
                                            -----------------------------------------------------------------------------------------------------------------------------------------------------------
                                             2017                                                2016                                                                     % Change
                                            -----                                           --------------                                           --------------------------------------------------
Atlanta                                       831                                                      755                                              10.1                                         %
Central Texas                                 157                                                      119                                              31.9                                         %
Charlotte                                       3                                           --                                                NM
Colorado                                      513                                                      460                                              11.5                                         %
Houston                                        70                                                       71                                              (1.4 )                                       %
Nevada                                        355                                                      256                                              38.7                                         %
Utah                                           49                                                        2                                           2,350.0                      %
                                            -----                                           --------------                                           ------- -------------------- --------------------
Total                                       1,978                                                    1,663                                              18.9                      %
                                            =====                                           ==============                                           ======= ==================== ====================

NM - Not meaningful

Home Deliveries
(dollars in thousands)
                                                                                                                                            
                                                                                                       Three Months Ended June 30,
                                              --------------------------------------------------------------------------------------------------------------------------------------------
                                                                   2017                                                                             2016                                                                                % Change                           
                                              -----------------------------------------------                     ------------------------------------------------------------------------                     -------------------------------------------------------------------------------
                                               Homes                      Average Sales Price                          Homes                                   Average Sales Price                                        Homes                                       Average Sales Price
                                              -----                      --------------------                     --------------                      ------------------------------------                     ---------------------------                     --------------------------------
Atlanta                                         264                              $    308.6                                  355                                         $          254.8                      (25.6 )%                                              21.1 %
Central Texas                                    83                              $    427.4                                   53                                                    427.1                       56.6 %                                                0.1 %
Colorado                                        229                              $    467.2                                  220                                                    445.6                        4.1 %                                                4.8 %
Houston                                          24                              $    318.0                                   47                                                    332.3                      (48.9 )%                                              (4.3 )%
Nevada                                          130                              $    363.4                                   93                                                    327.2                       39.8 %                                               11.1 %
Utah                                             23                              $    381.7                       --                        --                         NM                                NM  
                                              -----                      --------- ---------                      --------------                      -------------------- --------------                      ----- --------------------                      ---------- --------------------
Total / Weighted Average                        753                              $    381.9                                  768                                         $          334.9                       (2.0 )%                                              14.1 %
                                              =====                      ========= =========                      ==============                      ==================== ==============                      ===== ====================                      ========== ====================
                                                                                                                                                                                                                                                                
                                                                                                        Six Months Ended June 30,
                                              --------------------------------------------------------------------------------------------------------------------------------------------
                                                                   2017                                                                             2016                                                                                % Change                           
                                              -----------------------------------------------                     ------------------------------------------------------------------------                     -------------------------------------------------------------------------------
                                               Homes                      Average Sales Price                          Homes                                   Average Sales Price                                        Homes                                       Average Sales Price
                                              -----                      --------------------                     --------------                      ------------------------------------                     ---------------------------                     --------------------------------
Atlanta                                         514                              $    305.2                                  609                                         $          254.5                      (15.6 )%                                              19.9 %
Central Texas                                   139                              $    441.6                                  114                                                    436.8                       21.9 %                                                1.1 %
Colorado                                        415                              $    464.0                                  377                                                    442.6                       10.1 %                                                4.8 %
Houston                                          37                              $    318.8                                   74                                                    312.1                      (50.0 )%                                               2.1 %
Nevada                                          228                              $    353.8                                  133                                                    327.2                       71.4 %                                                8.1 %
Utah                                             28                              $    382.9                       --                        --                         NM                                NM  
                                              -----                      --------- ---------                      --------------                      -------------------- --------------                      ----- --------------------                      ---------- --------------------
Total / Weighted Average                      1,361                              $    377.7                                1,307                                         $          335.3                        4.1 %                                               12.6 %
                                              =====                      ========= =========                      ==============                      ==================== ==============                      ===== ====================                      ========== ====================

NM - Not meaningful

                                                                                                           Century Communities, Inc.
                                                                                                         Homebuilding Operational Data
                                                                                     
Selling Communities
                                                      As of June 30,                                                                                                        Increase/(Decrease)
                                         -----------------------------------------                                          ------------------------------------------------------------------------------------------------------------------
                                         2017                           2016                                                               Amount                                                            % Change
                                         ----                      --------------                                           ------------------------------------                     ---------------------------------------------------------
                                                                                                                                                                                                                          
Atlanta                                    35                                  29                                                        6                                                     20.7                                         %
Central Texas                              15                                  16                                                       (1 )                                                   (6.3 )                                       %
Charlotte                                   1                      --                                                        1                                                       NM
Colorado                                   20                                  27                                                       (7 )                                                  (25.9 )                                       %
Houston                                     6                                   8                                                       (2 )                                                  (25.0 )                                       %
Nevada                                      8                                  10                                                       (2 )                                                  (20.0 )                                       %
Utah                                        6                                   1                                                        5                                    NM    
                                         ----                      --------------                                           -------------- --------------------                      -------------- -------------------- --------------------
Total                                      91                                  91                                           --                        --                      %
                                         ====                      ==============                                           ============== ====================                      ============== ==================== ====================

NM - Not meaningful

Backlog
(dollars in thousands)
                                                                                                                                                                                                                                                         
                                                                                                                                                                           June 30,
                                              ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  2017                                                                                                                                       2016                                                                                                                                     % Change                                                  
                                              ------------------------------------------------------------------------------------------------------------                     ---------------------------------------------------------------------------------------------------------------------------------                     ------------------------------------------------------------------------------------------------------------------------------
                                               Homes                             Dollar Value                                    Average Sales Price                                Homes                                      Dollar Value                                          Average Sales Price                                        Homes                                       Dollar Value                                   Average Sales Price
                                              -----                      -----------------------------                     -------------------------------                     --------------                      ------------------------------------                     ------------------------------------                     --------------------------                     ----------------------------                     -------------------------------
Atlanta                                         586                                         $ 186,955                                         $    319.0                                  429                                         $        126,218                                         $      294.2                          36.6 %                                           48.1 %                                               8.4 %
Central Texas                                   154                                            77,626                                              504.1                                  114                                                   53,772                                                471.7                          35.1 %                                           44.4 %                                               6.9 %
Charlotte                                         3                                               861                                              286.8                       --                                           --                                           --                        NM                                               NM                                                  NM
Colorado                                        328                                           151,661                                              462.4                                  345                                                  161,312                                                467.6                          (4.9 )%                                          (6.0 )%                                             (1.1 )%
Houston                                          48                                            12,689                                              264.3                                   28                                                    9,821                                                350.7                          71.4 %                                           29.2 %                                             (24.6 )%
Nevada                                          217                                            81,799                                              377.0                                  152                                                   54,803                                                360.5                          42.8 %                                           49.3 %                                               4.6 %
Utah                                             30                         11,052                           368.4                                    2                                   815                             407.5                            NM                            NM                               NM  
                                              -----                      -------------------- -------                      -------------------- ---------                      --------------                      -------------------- --------------                      -------------------- --------------                      ---- --------------------                      ------ --------------------                      --------- --------------------
Total / Weighted Average                      1,366                                         $ 522,642                                         $    382.6                                1,070                                         $        406,742                                         $      380.1                          27.7 %                                           28.5 %                                               0.7 %
                                              =====                      ==================== =======                      ==================== =========                      ==============                      ==================== ==============                      ==================== ==============                      ==== ====================                      ====== ====================                      ========= ====================

NM - Not meaningful

Lot Inventory
                                                                                                                         
                                                                                                                      June 30,
                                   ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  2017                                                                                             2016                                                               % Change
                                   ------------------------------------------------------------------                     ---------------------------------------------------------------------------------------                     ------------------------------------------------------------------------------------
                                                                                                                                                                                                                                       
                                    Owned                     Controlled                       Total                           Owned                            Controlled                             Total                            Owned                        Controlled                              Total
                                   -----                      ----------                      ------                      --------------                      --------------                      --------------                      ---------                     ------------                     --------------------
                                                                                                                                                                                                                                                                                                      
Atlanta                            3,314                           2,935                       6,249                               2,861                               3,238                               6,099                       15.8 %                        (9.4 )%                                         2.5%
Central Texas                      1,122                           3,040                       4,162                               1,308                                 340                               1,648                      (14.2 )%                      794.1 %                                        152.5%
Colorado                           2,568                           3,215                       5,783                               2,690                                 641                               3,331                       (4.5 )%                      401.6 %                                         73.6%
Charlotte                            345                             949                       1,294                      --                      --                      --                         NM                            NM                                              NM
Houston                              664                           1,233                       1,897                                 205                                 361                                 566                      223.9 %                       241.6 %                                        235.2%
Nevada                             1,441                             450                       1,891                               1,771                                 107                               1,878                      (18.6 )%                      320.6 %                                          0.7%
Utah                                 253                           1,037                       1,290                                  47                                 474                                 521                      438.3 %                       118.8 %                                        147.6%
                                   -----                      ----------                      ------                      --------------                      --------------                      --------------                      ----- --                      ----- -----                      --------------------
Total                              9,707                          12,859                      22,566                               8,882                               5,161                              14,043                        9.3 %                       149.2 %                                         60.7%
                                   =====                      ==========                      ======                      ==============                      ==============                      ==============                      ===== ==                      ===== =====                      ====================

NM - Not meaningful

                                                                                                                                                                         Century Communities, Inc.
                                                                                                                                                                            Earnings Per Share
                                                                                                                                                                                (Unaudited)
                                                                                                                                                            (in thousands, except share and per share amounts)
 
                                                                                                                           Three Months Ended                                                                                                                Six Months Ended
                                                                                                                                                   June 30,                                                                                                                                            June 30,
                                                                                        -------------------------------------------------------------------------------------------------------------------------------                     -------------------------------------------------------------------------------------------------------------------------------
                                                                                                      2017                                2016                                                   2017                                2016               
                                                                                        ----------------------------------------------------                      ----------------------------------------------------                      ----------------------------------------------------                      ----------------------------------------------------
Numerator
Net income                                                                                                 $     14,831                                                              $     13,142                                                              $     23,630                                                              $     21,125
Less: Undistributed earnings allocated to participating securities                              (101 )                                                 (280 )                                                 (251 )                                                 (530 )
                                                                                        -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Net income allocable to common stockholders                                                                $     14,730                                           $     12,862                                           $     23,379                                           $     20,595  
                                                                                        ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
Denominator
Weighted average common shares outstanding - basic                                                           22,146,124                                                                20,649,910                                                                21,814,860                                                                20,628,598
Dilutive effect of restricted stock units                                                    219,953                              97,402                                                215,102                                                 58,009  
                                                                                        -------------------- ---------- --------------------                      -------------------- ---------- --------------------                                           ---------- --------------------                                           ---------- --------------------
Weighted average common shares outstanding - diluted                                      22,366,077                          20,747,312                                             22,029,962                                             20,686,607  
                                                                                        ==================== ========== ====================                      ==================== ========== ====================                                           ========== ====================                                           ========== ====================
Earnings per share:
Basic                                                                                                      $       0.67                                                              $       0.62                                                              $       1.07                                                              $       1.00
Diluted                                                                                                    $       0.66                                                              $       0.62                                                              $       1.06                                                              $       1.00

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 acquisitions 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. 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 June 30,
                                                                                            ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         2017                                %                              2016                                         %
                                                                                            --------------------------------------------------                      -------------------------------                     --------------------------------------------------                      ------------------------------------------------
                                                                                                                                                                                                                                                                                                                            
Home sales revenues                                                                                            $  287,588                                           100.0                        %                                         $  257,179                                           100.0                                         %
Cost of home sales revenues                                                                   (233,888 )                                         (81.3 )                      %                        (207,883 )                                         (80.8 )                                       %
                                                                                            -------------------- -------- --------------------                      ----- -------------------- ---                      -------------------- -------- --------------------                      ----- -------------------- --------------------
Gross margin from home sales                                                                                       53,700                                            18.7                        %                                             49,296                                            19.2                                         %
 Add: Interest in cost of home sales revenues                                                    6,875                          2.4     %                           4,918                          1.9                      %
                                                                                            -------------------- -------- --------------------                      ----- -------------------- ---                      -------------------- -------- --------------------                      ----- -------------------- --------------------
Adjusted homebuilding gross margin excluding interest                                                              60,575                                            21.1                        %                                             54,214                                            21.1                                         %
 Add: Purchase price accounting for acquired work in process inventory                             104                          0.0     %                              83                          0.0                      %
                                                                                            -------------------- -------- --------------------                      ----- -------------------- ---                      -------------------- -------- --------------------                      ----- -------------------- --------------------
Adjusted homebuilding gross margin excluding interest and purchase                                             $   60,679                         21.1     %                                         $   54,297                         21.1                      %
price accounting for acquired work in process inventory
                                                                                            ==================== ======== ====================                      ===== ==================== ===                      ==================== ======== ====================                      ===== ==================== ====================
                                                                                                                                                                                                                                                                                                                            
                                                                                             
                                                                                                                                                                                                          Six Months Ended June 30,
                                                                                            ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                         2017                                                   %                                                 2016                                                            %
                                                                                            --------------------------------------------------                      -------------------------------                     --------------------------------------------------                      ------------------------------------------------
                                                                                                                                                                                                                                                                                                                            
Home sales revenues                                                                                            $  514,008                                           100.0                        %                                         $  438,260                                           100.0                                         %
Cost of home sales revenues                                                                   (416,212 )                                         (81.0 )                      %                        (352,236 )                                         (80.4 )                                       %
                                                                                            -------------------- -------- --------------------                      ----- -------------------- ---                      -------------------- -------- --------------------                      ----- -------------------- --------------------
Gross margin from home sales                                                                                       97,796                                            19.0                        %                                             86,024                                            19.6                                         %
 Add: Interest in cost of home sales revenues                                                   11,831                          2.3     %                           7,985                          1.8                      %
                                                                                            -------------------- -------- --------------------                      ----- -------------------- ---                      -------------------- -------- --------------------                      ----- -------------------- --------------------
Adjusted homebuilding gross margin excluding interest                                                             109,627                                            21.3                        %                                             94,009                                            21.5                                         %
 Add: Purchase price accounting for acquired work in process inventory                             117                          0.0     %                             218                          0.0                      %
                                                                                            -------------------- -------- --------------------                      ----- -------------------- ---                      -------------------- -------- --------------------                      ----- -------------------- --------------------
Adjusted homebuilding gross margin excluding interest and purchase                                             $  109,744                         21.4     %                                         $   94,227                         21.5                      %
price accounting for acquired work in process inventory
                                                                                            ==================== ======== ====================                      ===== ==================== ===                      ==================== ======== ====================                      ===== ==================== ====================

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

Adjusted EBITDA

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.

(in thousands)                                                                                                                                                                                                                                
                                                                                                                                                                                                                                                                                                                                                                                                                                   
                                                                                                                                                       Three Months Ended June 30,                                                                                                                                                       Six Months Ended June 30,                                                                 
                                                                                      -------------------------------------------------------------------------------------------------------------------------------------------------------------                     ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                  2017                                                 2016                                                          % Change                                                       2017                                                 2016                                                                   % Change
                                                                                      ----------------------------                     ------------------------------------                     ---------------------------------------------------                     ----------------------------                     ------------------------------------                     ---------------------------------------------------------------------
Net income                                                                                               $ 14,831                                         $         13,142                                            12.9                       %                                         $ 23,630                                         $         21,125                                            11.9                                         %
Income tax expense                                                                                          8,278                                                    5,955                                            39.0                       %                                           11,530                                                   10,401                                            10.9                                         %
Interest in cost of home sales revenues                                                                     6,875                                                    4,918                                            39.8                       %                                           11,831                                                    7,985                                            48.2                                         %
Interest expense                                                                                                1                                                        2                                           (56.6 )                     %                                                2                                                        4                                           (58.1 )                                       %
Depreciation and amortization expense                                                    1,434                                 1,393                          2.9    %                         2,818                                 2,797                          0.8                      %
                                                                                      -------------------- ------                      -------------------- --------------                      -------------------- ----- -------------------- --                      -------------------- ------                      -------------------- --------------                      -------------------- ----- -------------------- --------------------
EBITDA                                                                                                     31,419                                                   25,410                                            23.6                       %                                           49,811                                                   42,312                                            17.7                                         %
Purchase price accounting for acquired work in process inventory                                              104                                                       83                                            25.3                       %                                              117                                                      218                                           (46.3 )                                       %
Purchase price accounting for investment in unconsolidated                                  30                        --                           NM    %                           855                        --                           NM                      %
subsidiaries outside basis
                                                                                      -------------------- ------                      -------------------- --------------                      -------------------- ----- -------------------- --                      -------------------- ------                      -------------------- --------------                      -------------------- ----- -------------------- --------------------
Adjusted EBITDA                                                                                          $ 31,553                                         $         25,493                         23.8    %                                         $ 50,783                                         $         42,530                         19.4                      %
                                                                                      ==================== ======                      ==================== ==============                      ==================== ===== ==================== ==                      ==================== ======                      ==================== ==============                      ==================== ===== ==================== ====================

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

Net Debt to Net Capital

The following table presents our ratio of net debt to net capital, which is a non-GAAP financial measure. We calculate this by dividing net debt (notes payable and revolving line of credit less cash held in escrow and cash and cash equivalents) by net capital (net debt plus total stockholders’ equity). The most directly comparable GAAP measure is the ratio of debt to capital. The Company believes the ratio of net debt to net capital is a relevant and useful financial measure to investors in understanding the leverage employed in its operations and as an indicator of the Company’s ability to obtain external financing.

(in thousands)                                                                    
                                                                                                                                               
                                                                      June 30,                                                               December 31,
                                                             2017                                                   2016               
                                                ---------------------------------------------------                      ----------------------------------------------------
Total debt                                                         $   787,400                                                              $    454,088
Total stockholders’ equity                          521,827                             473,636  
                                                -------------------- --------- --------------------                      -------------------- ---------- --------------------
Total capital                                                      $ 1,309,227                                           $    927,724  
                                                -------------------- --------- --------------------                      -------------------- ---------- --------------------
Debt to capital                                        60.1 %                                                 48.9 %
                                                ==================== ========= ====================                      ==================== ========== ====================
                                                                                                                                               
Total debt                                                         $   787,400                                                              $    454,088
Cash and cash equivalents                                             (336,786 )                                                                 (29,450 )
Cash held in escrow                                 (25,980 )                                              (20,044 )
                                                -------------------- --------- --------------------                      -------------------- ---------- --------------------
Net debt                                                               424,634                                                                   404,594
Total stockholders’ equity                          521,827                             473,636  
                                                -------------------- --------- --------------------                      -------------------- ---------- --------------------
Net capital                                                        $   946,461                                           $    878,230  
                                                ==================== ========= ====================                      ==================== ========== ====================
                                                                                                                                               
Net debt to net capital                                44.9 %                                                 46.1 %
                                                ==================== ========= ====================                      ==================== ========== ====================

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20170803006153r1&sid=cmtx6&distro=nx&

View source version on businesswire.com: http://www.businesswire.com/news/home/20170803006153/en/

SOURCE: Century Communities, Inc.

Investor Relations: 
303-268-8398 
InvestorRelations@CenturyCommunities.com


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