SOURCE: Meritage Homes Corporation

Meritage Homes Corporation

May 16, 2016 16:30 ET

Meritage Homes Provides Operational and Financial Guidance Update

Management Will Discuss Strategy, Markets and Outlook at the J.P. Morgan 2015 Homebuilding & Building Products Conference on Tuesday, May 17

SCOTTSDALE, AZ--(Marketwired - May 16, 2016) - Meritage Homes Corporation (NYSE: MTH), a leading U.S. homebuilder, today announced that it has updated its guidance policy to provide quarterly and annual guidance for orders, home closings, revenue, gross margin and diluted EPS. Meritage is taking this step in response to requests for additional visibility into these important operational and financial metrics on a continuing basis.

Based on Meritage's current forecasts for 2016, which reflect improved backlog conversion and operating leverage, the Company expects:

  • Orders of approximately 7,350-7,550 for the year, compared to 7,100 in 2015, and 1,900-2,100 for the second quarter, compared to 1,986 in the prior year;
  • Home closings of approximately 7,200-7,600 for the year, compared to 6,522 in 2015, and approximately 1,775-1,875 in the second quarter, compared to 1,556 in the prior year;
  • Home closing revenue of approximately $2.9-3.1 billion for the year, compared to $2.5 billion in 2015, and approximately $725-775 million in the second quarter, compared to $591 million in the prior year;
  • Home closing gross margin of approximately 18-18.5% for the year, compared to 19% in 2015, and mid-17-18% in the second quarter, compared to 19.3% in the prior year;
  • Diluted EPS of $3.55-3.85 for the year, compared to $3.09 in 2015, including $0.78-0.85 for the second quarter, compared to $0.70 in the prior year.

"Meritage is off to a strong start in 2016 as evidenced by the strong revenue, EPS and backlog growth we delivered in the first quarter," said Steven J. Hilton, chairman and chief executive officer of Meritage Homes. "With the positive momentum we're experiencing and the additional operating leverage we anticipate from increasing closing volumes throughout the remainder of the year, we are confident that our quarterly margins and earnings will continue to increase as we go through 2016. We believe that the continued execution of our strategy to expand our geographic footprint and grow market share, combined with the solid fundamentals underpinning our markets, will enable us to create lasting value for our shareholders."

Meritage management is scheduled to speak to investors at the J.P. Morgan 2015 Homebuilding & Building Products Conference in New York City on Tuesday, May 17, 2016, and will further discuss the Company's strategy, markets and outlook.

Management's presentation and subsequent discussion will be webcast live beginning at 8:00am Eastern time on Tuesday, May 17, and may be accessed through the "Investor Relations" page of the Meritage Homes website, http://investors.meritagehomes.com. Participants should access the webcast event page at least five minutes before the live event for the audio link. An archived replay of the session will be available on this site for 90 days following the presentation.

About Meritage Homes Corporation

Meritage Homes is the seventh-largest public homebuilder in the United States, based on homes closed in 2015. Meritage Homes builds and sells single-family homes for first-time, move-up, luxury and active adult buyers across the Western, Southern and Southeastern United States. Meritage Homes builds in markets including Sacramento, San Francisco Bay area, southern coastal and Inland Empire markets in California; Houston, Dallas-Ft. Worth, Austin and San Antonio, Texas; Phoenix/Scottsdale, Green Valley and Tucson, Arizona; Denver and Fort Collins, Colorado; Orlando, Tampa and south Florida; Raleigh and Charlotte, North Carolina; Greenville-Spartanburg and York County, South Carolina; Nashville, Tennessee; and Atlanta, Georgia.

Meritage Homes has designed and built more than 90,000 homes in its 30-year history, and has a reputation for its distinctive style, quality construction, and positive customer experience. Meritage Homes is the industry leader in energy-efficient homebuilding and has received the U.S. Environmental Protection Agency's ENERGY STAR Partner of the Year for Sustained Excellence Award in 2013, 2014, 2015 and 2016 for innovation and industry leadership in energy efficient homebuilding. For more information, visit meritagehomes.com.

For more information, visit investors.meritagehomes.com.

This release and the accompanying presentation and comments contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include management's expectations with respect to future revenue and earnings growth, estimated orders, home closings, home closing revenue, home closing gross margin and earnings per share for the second quarter and full year 2016, as well as the Company's expectations that strategic expansion will lead to market share growth and greater value for its shareholders.

Such statements are based upon the current beliefs and expectations of Company management, and current market conditions, which are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. The Company makes no commitment, and disclaims any duty, to update or revise any forward-looking statements to reflect future events or changes in these expectations. Meritage's business is subject to a number of risks and uncertainties. As a result of those risks and uncertainties, the Company's stock and note prices may fluctuate dramatically. These risks and uncertainties include, but are not limited to, the following: the availability and cost of finished lots and undeveloped land; interest rates and changes in the availability and pricing of residential mortgages; fluctuations in the availability and cost of labor; changes in tax laws that adversely impact us or our homebuyers; reversal of the current economic recovery; the ability of our potential buyers to sell their existing homes; cancellation rates; inflation in the cost of materials used to develop communities and construct homes; the adverse effect of slower order absorption rates; impairments of our real estate inventory; a change to the feasibility of projects under option or contract that could result in the write-down or write-off of option deposits; our potential exposure to natural disasters or severe weather conditions; competition; construction defect and home warranty claims; adverse legal rulings; failures in health and safety performance; our success in prevailing on contested tax positions; our ability to obtain performance bonds in connection with our development work; the loss of key personnel; changes in or our failure to comply with, laws and regulations; limitations of our geographic diversification; fluctuations in quarterly operating results; our level of indebtedness; our ability to obtain financing; our ability to successfully integrate acquired companies and achieve anticipated benefits from these acquisitions; our compliance with government regulations and the effect of legislative or other initiatives that seek to restrain growth of new housing construction or similar measures; legislation relating to energy and climate change; the replication of our energy efficient technologies by our competitors; our exposure to information technology failures and security breaches; and other factors identified in documents filed by the Company with the Securities and Exchange Commission, including those set forth in our Form 10-K for the year ended December 31, 2015 and subsequent quarterly reports on Forms 10-Q under the caption "Risk Factors," which can be found on our website.

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