M/I HOMES, INC.
For the period ended Mar 31, 2025. Filed Apr 25, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed Apr 25, 2025
MHO$131.60-2.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-01.
0000799292-24-000092
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-04-25.
0000799292-25-000033
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 142 previous paragraphs and 132 current paragraphs.
58 unchanged; 53 reworded; 21 added; 29 removed; 2 previous and 0 current paragraphs rearranged.
Tables are not compared: 12 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
During the first quarter of 2025, housing market conditions remained subject to challenging macroeconomic conditions. Elevated mortgage interest rates, limited availability of affordable housing and geopolitical uncertainties, including recent trade policies, negatively impacted consumer confidence causing weaker prospective homebuyer demand when compared to the same period of 2024. To address affordability and spur demand, we offered various sales incentives and mortgage interest rate buydowns to homebuyers which negatively impacted our profitability. Within this backdrop, our first quarter performance fell short of 2024’s record levels, but was generally consistent with our expectations. Our results during the first quarter of 2025 in comparison to the first quarter of 2024 were as follows:
Current report
•New contracts declined 10% to 2,292 from 2,547
Current report
•Revenue decreased 7% to $976.1 million
Current report
•Number of homes delivered decreased 8% to 1,976 homes
Current report
•Average sales price increased 1% from $471,000 to $476,000
Current report
•Gross margins decreased 120 basis points to 25.9%
Current report
•Income before income taxes decreased 19% to $146.1 million
Current report
•Net income decreased 19% to $111.2 million
Current report
Income before income taxes for the first quarter of 2025 decreased 19% from $180.2 million in the first quarter of 2024 to $146.1 million in 2025. Net income was $111.2 million, or $3.98 per diluted share, in 2025's first quarter, compared to $138.1 million, or $4.78 per diluted share, in 2024's first quarter. Our effective tax rate was 23.9% in 2025’s first quarter compared to 23.4% in 2024.
Current report
During the quarter ended March 31, 2025, our total revenue was $976.1 million, of which $944.6 million was from homebuilding and $31.5 million was from our financial services operations. Revenue from homebuilding decreased 7% in 2025's first quarter compared to the same period in 2024 driven primarily by an 8% decrease in the number of homes delivered (182 units) offset in part by a 1% increase in the average sales price of homes delivered ($5,000 per home delivered). Our revenue and average sales price reflect a $40.0 million reduction for incentives and closing costs in 2025’s first quarter compared to a $24.8 million reduction for incentives and closing costs in 2024’s first quarter. Revenue from our financial services segment increased 17% to an all-time quarterly record $31.5 million in the first quarter of 2025 as a result of higher margins on loans sold and improved capture rates offset in part by a decrease in the number of loans originated during the period compared to the first quarter of 2024.
Current report
For the three months ended March 31, 2025, selling, general and administrative expense increased $1.8 million, and increased as a percentage of revenue from 10.5% in the first quarter of 2024 to 11.5% in the first quarter of 2025. Selling expense decreased $1.2 million from 2024's first quarter and increased as a percentage of revenue to 5.4% in 2025's first quarter from 5.2% for the same period in 2024. The dollar decrease in selling expense related to a $3.4 million decrease in sales and realtor commissions due to the decrease in the homes delivered during the period compared to prior year which was partially offset by a $2.2 million increase in costs associated with our sales offices, including compensation-related expenses and advertising initiatives in the first quarter of 2025. General and administrative expense increased $3.0 million in the first quarter of 2025 compared to first quarter of 2024 and also increased as a percentage of revenue from 5.4% in the first quarter of 2024 to 6.1% in first quarter of 2025. The increase in general and administrative expense was primarily due to a $2.7 million increase in compensation-related expenses, a $0.9 million increase in costs associated with information systems offset by a $0.6 million decrease in miscellaneous expenses.
Current report
We are currently navigating an uncertain environment in the housing market due to challenging macroeconomic conditions, including ongoing elevated mortgage interest rates, housing affordability concerns, and heightened geopolitical uncertainties. Additionally, recently announced changes in U.S. trade policies and other U.S. government administrative changes may produce additional uncertainty and negatively impact the housing market. Despite this uncertain environment and the challenges it presents, we remain optimistic about our business. During the first three months of 2025, tariffs had no impact on our costs. However, we continue to monitor potential impacts of tariffs with our supply chain. Similarly, we did not encounter any labor disruptions due to immigration enforcement during the first quarter of 2025. We believe that long-term housing market drivers are largely positive, including favorable demographic trends, rising household formations, and the undersupply of new and resale homes.
Current report
However, we expect that the softer market conditions we experienced in the first quarter of 2025 will persist throughout the year. We believe that these conditions have negatively impacted consumer confidence, caused homebuyers to take longer to make purchase decisions and reduced demand at the start of the Spring selling season compared to recent years. We remain sensitive to market conditions and continue to focus on controlling overhead leverage, carefully managing our investment in land and land development spending, and selectively offering homebuyer concessions, such as mortgage interest rate buydowns, to support homebuyers, maximize order activity, and minimize cancellations. The extent to which these factors will continue to impact our business is highly uncertain and unpredictable, and our past performance should not be considered indicative of future results given the uncertainty in the U.S. economy.
Current report
•Promote sales through interest rate buydowns and/or other incentives where necessary
Current report
•Manage our construction cycle times
Current report
•Open new communities
Current report
•Manage overhead spend
Current report
Selling, general and administrative expense decreased $0.4 million, from $30.7 million for the quarter ended March 31, 2024 to $30.3 million for the quarter ended March 31, 2025 and declined 10 basis points as a percentage of revenue to 7.4% in 2025's first quarter from 7.5% in 2024's first quarter. The decrease in selling, general and administrative expense was attributable to a $0.3 million decrease in general and administrative expense primarily related to land-related expenses and a$0.1 million decrease in selling expense. The decrease in selling expense was due to a $0.9 million decrease in sales and realtor commissions produced by the lower number of homes delivered offset in part by a $0.8 million increase in costs associated with our sales offices, including compensation and model homes.
Current report
2024's first quarter. Our monthly absorption rate in our Northern region was 3.8 per community in both the first quarter of 2025 and the first quarter of 2024.
Current report
Selling, general and administrative expense increased $0.2 million from $49.7 million in the first quarter of 2024 to $49.9 million in the first quarter of 2025 and increased 120 basis points as a percentage of revenue to 9.3% in the first quarter of 2025 from 8.1% in the first quarter of 2024. This increase in selling, general and administrative expense was primarily attributable to a $1.2 million increase in general and administrative expense, which was due to a $0.5 million increase in compensation-related expenses, a $0.3 million increase in land-related expenses, and a $0.4 million increase in miscellaneous expenses. Selling expense decreased $1.1 million due to a $2.5 million decrease in realtor and sales commissions offset in part by a $1.4 million increase in costs related to our sales office, compensation and models due to an increase in our community count.
Current report
As is typical for similar credit facilities in the mortgage origination industry, at closing, the expiration of the MIF Mortgage Repurchase Facility was set at approximately one year and is under consideration for extension annually by the participating lenders. We expect to extend the MIF Mortgage Repurchase Facility on or prior to the current expiration date of October 21, 2025, but we cannot provide any assurance that we will be able to obtain such an extension.
Removed paragraphs (29)
Previous report
We continued to generate strong results during the three and nine months ended September 30, 2024. For the quarter ended September 30, 2024, we achieved year-to-date and third quarter records for revenue, income before taxes, and net income. In addition, we achieved a third quarter record for gross margin of 27.1%. We also increased homes delivered by 8% for the third quarter (to a third quarter record of 2,271 homes) and 9% for the nine months ended September 30, 2024 compared to the respective periods in 2023. For the nine months ended September 30, 2024 new contracts benefited from a strong first half of the year, increasing 7% year-to-date despite our third quarter new contracts being even with last year’s third quarter. Although the Federal Reserve Board decreased interest rates in September 2024, which we believe should help improve the affordability of and accelerate demand for new housing, interest rates during the third quarter remained elevated and negatively impacted overall demand.
Previous report
We achieved the following results during the three and nine months ended September 30, 2024 in comparison to the three and nine months ended September 30, 2023:
Previous report
•Revenue increased 9% to $1.14 billion (a third quarter record) and 8% to $3.30 billion (a year-to-date record), respectively;
Previous report
•Number of homes delivered increased 8% to 2,271 homes (a third quarter record) and 9% to 6,653 homes (a year-to-date record), respectively;
Previous report
•Gross margins improved 20 basis points to 27.1% (a third quarter record) and 200 basis points to 27.3%, respectively;
Previous report
•Income before income taxes increased 6% to $188.7 million (a third quarter record) and 20% to $563.1 million (a year-to-date record), respectively;
Previous report
•Net income increased 5% to $145.4 million (a third quarter record) and 19% to $430.3 million (a year-to-date record), respectively;
Previous report
•New contracts were even with last year at 2,023 and increased 7% to 6,825 from 6,389 (the third highest year-to-date level in Company history), respectively;
Previous report
Income before income taxes for the third quarter of 2024 increased 6% from $178.0 million in the third quarter of 2023 to a third quarter record $188.7 million in 2024. We also achieved a third quarter record for net income of $145.4 million, or $5.10 per diluted share, in 2024's third quarter, compared to net income of $139.0 million, or $4.82 per diluted share, in 2023's third quarter. Our effective tax rate was 22.9% in 2024’s third quarter compared to 21.9% in 2023. Income before income taxes increased from $469.3 million in the nine months ended September 30, 2023 to $563.1 million in the first nine months of 2024, a year-to-date record. We achieved a year-to-date record for net income of $430.3 million, or $14.99 per diluted share, during 2024's first nine months compared to net income of $360.1 million, or $12.58 per diluted share, in the nine months ended September 30, 2023. Our effective tax rate was 23.6% in 2024's first nine months compared to 23.3% in the same period in 2023.
Previous report
During the quarter ended September 30, 2024, we achieved record third quarter total revenue of $1.14 billion, of which $1.11 billion was from homes delivered, $1.6 million was from land sales and $30.0 million was from our financial services operations. Revenue from homes delivered increased 10% in 2024's third quarter compared to the same period in 2023 driven primarily by an 8% increase in the number of homes delivered (175 units) and a 2% increase in the average sales price of homes delivered ($8,000 per home delivered). Revenue from land sales decreased $12.9 million from the third quarter of 2023 due to fewer land sales in the current year compared to the prior year. Revenue from our financial services segment increased 27% to an all-time quarterly record $30.0 million in the third quarter of 2024 as a result of higher margins on and an increase in loans sold during the period compared to the third quarter of 2023. For the nine months ended September 30, 2024, we recorded year-to-date record total revenue of $3.30 billion, of which $3.20 billion was from homes delivered, $11.8 million was from land sales and $87.7 million was from our financial services operations. Revenue from homes delivered increased 8% in the nine months ended September 30, 2024 compared to the same period in 2023 driven primarily by a 9% increase in the number of homes delivered (560 units), partially offset by a 1% decrease in the average sales price of homes delivered ($5,000 per home delivered). Revenue from land sales decreased $11.5 million from the nine months ended September 30, 2023 due to decreased land sales in 2024's first nine months compared to the prior year. Revenue from our financial services segment increased 18% to $87.7 million in the first nine months of 2024 as a result of higher margins on loans sold and an increase in loans sold during the period compared to the nine months ended September 30, 2023, partially offset by a decrease in the average loan amount compared to the nine months ended September 30, 2023.
Previous report
For the three months ended September 30, 2024, selling, general and administrative expense increased $17.8 million, and increased as a percentage of revenue from 10.5% in the third quarter of 2023 to 11.2% in the third quarter of 2024. Selling expense increased $5.4 million from 2023's third quarter and increased as a percentage of revenue to 5.2% in 2024's third quarter from 5.1% for the same period in 2023. Variable selling expense for sales commissions contributed $2.5 million to the increase due to the higher number of homes delivered as well as higher co-op rates during the period compared to prior year. Non-variable selling expense increased $2.9 million primarily as a result of increased costs associated with our sales offices and models due to our increase in community count from prior year. General and administrative expense increased $12.4 million compared to the third quarter of 2023 and increased as a percentage of revenue from 5.3% in the third quarter of 2023 to 6.0% in the third quarter of 2024. The increase in general and administrative expense was primarily due to a $7.6 million increase in compensation-related expenses due to higher headcount and incentives, a $0.9 million increase in professional fees, a $0.7 million increase in computer costs, a $0.6 million increase in land-related expenses, and a $2.6 million increase in various other expenses. For the nine months ended September 30, 2024, selling, general and administrative expense increased $42.8 million, and increased as a percentage of revenue from 10.4% in the nine months ended September 30, 2023 to 10.9% in the nine months ended September 30, 2024. Selling expense increased $16.9 million from the nine months ended September 30, 2023 and increased as a percentage of revenue to 5.2% in 2024's first nine months from 5.1% for the same period in 2023. Variable selling expense for sales commissions contributed $10.2 million to the increase due to the higher number of homes delivered during the first nine months of 2024 and higher co-op rates during the period compared to prior year. Non-variable selling expense increased $6.7 million primarily as a result of increased costs associated with our sales offices and models due to our increase in community count from prior year. General and administrative expense increased $25.9 million compared to the nine months ended September 30, 2023 and increased as a percentage of revenue from 5.3% in the nine months ended September 30, 2023 to 5.7% in the nine months ended September 30, 2024. The increase in general and administrative expense was primarily due to a $16.9 million increase in compensation-related expenses due to higher average headcount and incentives, a $2.0 million increase in computer costs, a $1.8 million increase in land-related expenses, a $1.2 million increase in professional fees, and a $4.0 million increase in various other expenses.
Previous report
•continued focus on cycle times;
Previous report
•opening new communities;
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•managing overhead spend;
Previous report
Selling, general and administrative expense increased $6.1 million, from $29.2 million for the quarter ended September 30, 2023 to $35.3 million for the quarter ended September 30, 2024 but declined 130 basis points as a percentage of revenue to 7.1% in 2024's third quarter from 8.4% in 2023's third quarter. The increase in selling, general and administrative expense was attributable to a $4.9 million increase in selling expense primarily due to a $4.3 million increase in variable selling expenses resulting from increases in sales commissions produced by the higher number of homes delivered as well as a $0.6 million increase in non-variable selling expense primarily as a result of increased costs associated with our sales offices and models. This increase in selling, general and administrative expense was also attributable to a $1.2 million increase in general and administrative expense, which was primarily related to a $0.5 million increase in compensation-related expenses and $0.2 million increase in land related expenses.
Previous report
Selling, general and administrative expense increased $5.0 million from $49.5 million in the third quarter of 2023 to $54.5 million in the third quarter of 2024 and increased 160 basis points as a percentage of revenue to 8.9% from 7.3% in the third quarter of 2023. This increase in selling, general and administrative expense was primarily attributable to a $4.5 million increase in general and administrative expense, which was due to a $2.4 million increase in compensation-related expenses, a $0.4 million increase in land-related expenses, and a $1.7 million increase in miscellaneous expenses. The increase in selling, general and administrative expense was also attributable to a $0.5 million increase in selling expense primarily due to a $2.2 million increase in non-variable selling expense primarily as a result of increased costs associated with our sales offices and models due to our increased community count, offset partially by a $1.7 million decrease in variable selling expenses resulting from decreases in sales commissions produced by the lower number of homes delivered.
Previous report
Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023
Previous report
Northern Region. Homebuilding revenue in our Northern region increased $256.9 million, from $1.11 billion in the nine months ended September 30, 2023 to $1.37 billion in the nine months ended September 30, 2024. This 23% increase in homebuilding revenue was primarily the result of a 21% increase in the number of homes delivered (488 more units) and the mix of homes delivered with an increase in the average sales price of homes delivered ($8,000 per home delivered), offset in part by a $0.4 million decrease in land sale revenue. Operating income in our Northern region increased $76.6 million, from $129.8 million during the nine months ended September 30, 2023 to $206.4 million during the nine months ended September 30, 2024. The increase in operating income was primarily the result of a $90.6 million increase in our gross margin offset partially by a $14.0 million increase in selling, general and administrative expense. With respect to our homebuilding gross margin, our housing gross margin improved $90.1 million, and our housing gross margin percentage improved 290 basis points from 19.4% in the nine months ended September 30, 2023 to 22.3% for the same period in 2024, primarily due to the mix of homes being delivered in addition to the increase in the number of homes delivered. Our land sale gross margin improved $0.4 million in the nine months ended September 30, 2024 compared to the same period in 2023 as a result of the mix of lots sold in the current year compared to the prior year.
Previous report
Selling, general and administrative expense increased $14.0 million, from $86.2 million for the nine months ended September 30, 2023 to $100.2 million for the nine months ended September 30, 2024, but improved by as a percentage of revenue at 7.3% in 2024 compared to 7.7% in 2023. The increase in selling, general and administrative expense was attributable to a $11.0 million increase in selling expense, primarily attributable to a $9.8 million increase in variable selling expenses resulting from increases in sales commissions produced by the higher number of homes delivered and a $1.2 million increase in costs associated with our sales offices and models. The increase in selling, general and administrative expense was also attributable to a $3.0 million increase in general and administrative expense, which was primarily related to a $1.3 million increase in compensation-related expenses and $1.7 million increase in other miscellaneous expenses.
Previous report
During the nine months ended September 30, 2024, we experienced a 15% increase in new contracts in our Northern region, from 2,662 in the nine months ended September 30, 2023 to 3,054 in the first nine months of 2024. Homes in backlog increased 7% from 1,397 at September 30, 2023 to 1,493 homes at September 30, 2024. The increase in new contracts and homes in backlog was primarily due to improved demand. Average sales price in backlog increased to $538,000 at September 30, 2024 compared to $521,000 at September 30, 2023 primarily due to the mix of homes being sold. During the nine months ended September 30, 2024, we opened 17 new communities in our Northern region compared to 27 new communities opened during the nine months ended September 30, 2023. The decrease was a result of delays in approvals for entitlements and permits, and longer development timelines, all of which delayed community openings during the period. Our monthly absorption rate in our Northern region improved to 3.5 per community in the nine months ended September 30, 2024 from 2.9 per community in the same period in 2023 as a result of increased availability of and demand for inventory homes.
Previous report
Southern Region. During the nine months ended September 30, 2024, homebuilding revenue in our Southern region decreased $32.0 million from $1.87 billion in the nine months ended September 30, 2023 to $1.84 billion in the nine months ended September 30, 2024. This 2% decrease in homebuilding revenue was the result of an $11.1 million decrease in land sale revenue and a 3% decrease in the average sales price of homes delivered ($15,000 per home delivered) primarily due to the mix of homes delivered, offset in part by a 2% increase in the number of homes delivered (72 units). Operating income in our Southern region increased 3% from $343.2 million in the nine months ended September 30, 2023 to $351.7 million during the nine months ended September 30, 2024. This increase in operating income was the result of a $23.4 million improvement in our gross margin, offset partially by a $14.8 million increase in selling, general, and administrative expense. With respect to our homebuilding gross margin, our gross margin on homes delivered improved $23.5 million, due primarily to the increase in the number of homes delivered during the period and the mix of homes delivered, offset partially by the decrease in average sale price of homes delivered. Our housing gross margin percentage improved 160 basis points from 26.0% in the nine months ended September 30, 2023 to 27.6% in the same period in 2024 primarily due to the mix of homes delivered, offset partially by the decrease in average sales price of homes delivered compared to prior year. Our land sale gross margin declined $0.1 million in the nine months ended September 30, 2024 compared to the same period in 2023 as a result of the mix of lots sold in the current year compared to the prior year.
Previous report
Selling, general and administrative expense increased $14.8 million from $141.3 million in the nine months ended September 30, 2023 to $156.1 million in the nine months ended September 30, 2024 and increased as a percentage of revenue to 8.5% compared to 7.5% in 2023’s same period. The increase in selling, general and administrative expense was attributable to a $5.4 million increase in selling expense primarily due to a $5.0 million increase in non-variable selling expenses primarily related to costs associated with our sales offices and models due to our increased community count and a $0.4 million increase in variable selling expenses resulting from increases in sales commissions produced by the higher number of homes delivered. The increase in selling, general and administrative expense was also attributable to a $9.4 million increase in general and administrative expense, which was primarily related to a $5.7 million increase in compensation-related expenses due to our increased headcount and our strong consolidated financial performance during the period, a $1.3 million increase in land-related expenses, and a $2.4 million increase in other miscellaneous expenses.
Previous report
During the nine months ended September 30, 2024, we experienced a 1% increase in new contracts in our Southern region, from 3,727 in the nine months ended September 30, 2023 to 3,771 in the first nine months of 2024 primarily due to the increase in our average number of communities compared to prior year. Homes in backlog decreased 17% from 2,036 homes at September 30, 2023 to 1,681 homes at September 30, 2024 due primarily to improved construction cycle times allowing us to deliver homes in backlog at a faster rate compared to last year in addition to increased availability of inventory homes compared to prior year. Average sales price in backlog increased from $503,000 at September 30, 2023 to $549,000 at September 30, 2024 primarily due to the mix of homes delivered. During the nine months ended September 30, 2024, we opened 40 communities in our Southern region, compared to opening 29 during the nine months ended September 30, 2023. Our monthly absorption rate in our Southern region declined to 3.5 per community in the nine months ended September 30, 2024 from 4.2 per community in the nine months ended September 30, 2023 as a result of the limited lot supply in the increased number of our communities in closeout status.
Previous report
Financial Services. Revenue from our mortgage and title operations increased 18% from $74.1 million in the nine months ended September 30, 2023 to $87.7 million in the nine months ended September 30, 2024 due to higher margins on loans sold during the period compared to 2023's first nine months, proceeds from the sale of mortgage servicing rights, and a 21% increase in the number of loan originations from 4,008 in the nine months ended September 30, 2023 to 4,869 in the nine months ended September 30, 2024, offset partially by a decrease in the average loan amount from $396,000 in the nine months ended September 30, 2023 to $395,000 in the nine months ended September 30, 2024.
Previous report
Our financial services segment experienced a $8.5 million increase in operating income in the nine months ended September 30, 2024 compared to the same period in 2023, which was primarily due to the increase in revenue discussed above, partially offset by a $5.1 million increase in selling, general and administrative expense compared to the nine months ended September 30, 2023. The increase in selling, general and administrative expense was primarily attributable to a $4.6 million increase in compensation related expenses, a $0.6 million increase in indemnification reserves during the period, and a $0.1 million decrease in other miscellaneous expenses.
Previous report
Corporate Selling, General and Administrative Expense. Corporate selling, general and administrative expense increased $8.9 million from $56.7 million for the nine months ended September 30, 2023 to $65.6 million for the nine months ended September 30, 2024, primarily due to a $5.3 million increase in compensation-related expenses, a $1.0 million increase in computer-related costs, a $0.9 million increase in advertising expenses, and a $1.7 million increase in miscellaneous expenses incurred during the period.
Previous report
Income Taxes. Our overall effective tax rate was 23.6% for the nine months ended September 30, 2024 and 23.3% for the nine months ended September 30, 2023. The increase in the effective rate from the nine months ended September 30, 2023 was primarily attributable to a $0.2 million decrease in tax benefit from equity compensation in 2024.
Previous report
$300 million (and was subject to increases and decreases during certain periods). The MIF Mortgage Repurchase Facility was scheduled to expire on October 22, 2024.
Previous report
On October 22, 2024, M/I Financial entered into an amendment to the MIF Mortgage Repurchase Facility that extends the term of the MIF Mortgage Repurchase Facility for an additional year to October 21, 2025 and increases the aggregate commitment amount to $300 million for the entire remaining term. As is typical for similar credit facilities, the amended MIF Mortgage Repurchase Facility expires after one year and is under consideration for extension annually by the participating lenders.
Reworded paragraphs (53)
Previous wording
M/I Homes, Inc. and subsidiaries (the “Company” or “we”) is one of the nation’s leading builders of single-family homes having sold over 158,200 homes since commencing homebuilding activities in 1976. The Company’s homes are marketed and sold primarily under the M/I Homes brand. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Chicago, Illinois; Minneapolis/St. Paul, Minnesota; Detroit, Michigan; Ft. Myers/Naples, Tampa, Sarasota and Orlando, Florida; Austin, Dallas/Fort Worth, Houston and San Antonio, Texas; Charlotte and Raleigh, North Carolina; and Nashville, Tennessee.
Current wording
M/I Homes, Inc. and subsidiaries (the “Company” or “we”) is one of the nation’s leading builders of single-family homes having sold over 162,300 homes since commencing homebuilding activities in 1976. The Company’s homes are marketed and sold primarily under the M/I Homes brand. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Chicago, Illinois; Minneapolis/St. Paul, Minnesota; Detroit, Michigan; Ft. Myers/Naples, Tampa, Sarasota and Orlando, Florida; Austin, Dallas/Fort Worth, Houston and San Antonio, Texas; Charlotte and Raleigh, North Carolina; and Nashville, Tennessee.
Previous wording
Certain information included in this report or in other materials we have filed or will file with the Securities and Exchange Commission (the “SEC”) (as well as information included in oral statements or other written statements made or to be made by us) contains or may contain forward-looking statements, including, but not limited to, statements regarding our future financial performance and financial condition. Words such as “expects,” “anticipates,” “envisions,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various risk factors, including, without limitation, factors relating to the economic environment, interest rates, availability of resources, competition, market concentration, land development activities, construction defects, product liability and warranty claims and various governmental rules and regulations. See “Item 1A. Risk Factors” in Part I of our Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Form 10-K”), as the same may be updated from time to time in our subsequent filings with the SEC, for more information regarding those risk factors.
Current wording
Certain information included in this report or in other materials we have filed or will file with the Securities and Exchange Commission (the “SEC”) (as well as information included in oral statements or other written statements made or to be made by us) contains or may contain forward-looking statements, including, but not limited to, statements regarding our future financial performance and financial condition. Words such as “expects,” “anticipates,” “envisions,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various risk factors, including, without limitation, factors relating to the economic environment, interest rates, availability of resources, competition, market concentration, land development activities, construction defects, product liability and warranty claims and various governmental rules and regulations including changes in trade policy affecting business including new or increased tariffs, as well as the potential impact of retaliatory tariffs and other penalties. See “Item 1A. Risk Factors” in Part I of our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”), as the same may be updated from time to time in our subsequent filings with the SEC, for more information regarding those risk factors.
Previous wording
•Shareholders’ equity of $2.85 billion (a record high);
Current wording
•Shareholders’ equity of $3.0 billion (a record high)
Previous wording
•Book value per common share increased to a record high $105 per share; and
Current wording
•Book value per common share increased to a record high $112 per share; and
Previous wording
•Homebuilding debt to capital ratio was 20%.
Current wording
•Homebuilding debt to capital ratio was 19%.
Previous wording
In addition to the results described above, our financial services operations also achieved third quarter record quarterly revenues and strong income before income taxes for the first nine months of 2024, benefiting from higher margins and an increase in loans originated.
Current wording
In addition to the results described above, our financial services operations achieved a quarterly record for revenue and strong income before income taxes for the first quarter of 2025, benefiting from higher margins and improved capture rates offset in part by a decrease in loans originated.
Previous wording
Our company-wide absorption pace of sales per community for the third quarter of 2024 declined slightly to 3.2 per month compared to 3.4 per month for the prior year’s third quarter. We plan to open additional new communities during the fourth quarter of 2024 and increase our average community count by about 5% from 2023.
Current wording
Our company-wide absorption pace of sales per community for the first quarter of 2025 declined to 3.4 per month compared to 3.9 per month for the prior year’s first quarter as a result of the macroeconomic conditions described above. We plan to open additional new communities during the remainder of 2025 and increase our average community count by about 5% from 2024.
Previous wording
Total gross margin (total revenue less total land and housing costs) increased $27.7 million in the third quarter of 2024 compared to the third quarter of 2023 as a result of a $21.3 million improvement in the gross margin of our homebuilding operations (housing gross margin and land sales gross margin) and a $6.4 million increase in the gross margin of our financial services operations. With respect to our homebuilding gross margin, our gross margin on homes delivered (housing gross margin) improved $23.4 million and our housing gross margin percentage declined by 30 basis points to 25.1% from 25.4%. The improvement in gross margin dollars primarily resulted from the 8% increase in homes delivered. Our housing gross margin may fluctuate from quarter to quarter depending on the mix of communities delivering homes due to the variation in margin between different communities. Our gross margin on land sales (land sale gross margin) decreased $2.0 million in the third quarter of 2024 compared to the third quarter of 2023 as a result of the mix of lots sold in the current year compared to the prior year. The gross margin of our financial services operations increased $6.4 million in the third quarter of 2024 compared to the third quarter of 2023 as a result of higher margins on and an increased number of loans sold, and an increase in the number of loan originations. Total gross margin increased $127.5 million in the nine months ended September 30, 2024 compared to the same period in 2023 as a result of a $114.0 million improvement in the gross margin of our homebuilding operations in addition to approximately $13.6 million improvement in the gross margin of our financial services operations. With respect to our homebuilding gross margin, our gross margin on homes delivered improved $113.7 million and our housing gross margin percentage improved 180 basis points from 23.5% in prior year’s first nine months to 25.3% in 2024's first nine months. These increases are primarily due to the 9% increase in the number of homes delivered primarily due to the mix of homes delivered, offset partially by the 1% decrease in the average sales price of homes delivered. Our gross margin on land sales improved $0.3 million in 2024's first nine months compared to the same period in 2023. The gross margin of our financial services operations increased $13.6 million in the nine months ended September 30, 2024 compared to the same period in 2023 as a result of an increased number of loans sold, offset in part by lower average loan amount during the first nine months of 2024 compared to the first nine months of 2023, and increases in the number of loan originations and the average loan amount.
Current wording
Total gross margin (total revenue less total land and housing costs) decreased $30.6 million in the first quarter of 2025 compared to the first quarter of 2024 as a result of a $35.1 million decline in the gross margin of our homebuilding operations and a $4.5 million increase in the gross margin of our financial services operations. Our homebuilding gross margin percentage declined by 170 basis points to 23.4% from 25.1%. The decline in gross margin dollars primarily resulted from the 8% decrease in homes delivered and a $9.8 million increase in interest rate buydowns offered in 2025 compared to 2024. Our homebuilding gross margin may fluctuate from quarter to quarter depending on the mix of communities delivering homes due to the variation in margin between different communities and incentives used to encourage demand due to market conditions. The gross margin of our financial services operations increased $4.5 million in the first quarter of 2025 compared to the first quarter of 2024 as a result of higher margins on loans sold, improved capture rates offset in part by a decrease in the number of loan originations.
Previous wording
We opened 57 new communities during the nine months ended September 30, 2024 and closed 53 communities. We sell a variety of home types in various communities and markets, each of which yields a different gross margin. The timing of the openings of new replacement communities as well as underlying lot costs varies from year to year. The mix of communities delivering homes may cause fluctuations in our new contracts, absorption pace and housing gross margin from year to year.
Current wording
We opened 27 new communities during the first quarter of 2025 and closed 21 communities. We sell a variety of home types in various communities and markets, each of which yields a different gross margin. The timing of the openings of new replacement communities as well as underlying lot costs varies from year to year. The mix of communities delivering homes may cause fluctuations in our new contracts, absorption pace and housing gross margin from year to year.
Previous wording
Housing market conditions remain relatively healthy. Although inflation and mortgage interest rates remain elevated, demographics supporting housing demand continue to be favorable as a result of the limited supply of both new and existing homes at affordable price points compared to the rate of household formations. While strong demand for housing (which has recently been supported by incentives and mortgage rate buydowns) has driven new home sales over the past two years, we anticipate that the Federal Reserve Board’s recent reduction to interest rates coupled with more controlled inflation could further encourage demand. However, the housing market remains subject to unpredictability as a result of uncertainty regarding various macroeconomic conditions, including interest rates, labor and material costs and availability, inflation, policies that may stem from the outcome of the U.S. elections and the economic concerns of our potential homebuyers. Although the extent to which these factors will impact our business is unpredictable, we believe that we are well positioned to continue to grow by focusing on our land position, new community openings, and affordable product offerings. We remain sensitive to potential changes in market conditions, and continue to focus on controlling overhead leverage, carefully managing our investment in land and land development spending and selectively offering homebuyer concessions, such as mortgage interest rate buydowns, to support homebuyers, drive order activity and minimize cancellations. We continue to have a healthy backlog with a record average sales price that is 7% higher than at the end of the third quarter of 2023. Our strong balance sheet and ample liquidity should also provide us with flexibility through changing economic conditions. We cannot, however, provide any assurances that our strategic business objectives listed below will remain successful, and we will need to remain agile to effectively address changes in market conditions.
Current wording
We believe that we are well-positioned to manage through these uncertain times. We continue to maintain a healthy backlog, despite a decline from the prior year, with an average sales price that is 4% higher than at the end of the first quarter of 2024. Our strong balance sheet and ample liquidity provide us with the flexibility to manage through these uncertain economic conditions. However, we cannot provide any assurances that our strategic business objectives will remain successful, and we will need to remain agile to effectively address changes in market conditions as they arise.
Previous wording
•managing our land spend and inventory levels;
Current wording
•Manage our land spend and inventory levels
Previous wording
•maintaining a strong balance sheet and liquidity levels; and
Current wording
•Maintain a strong balance sheet and liquidity levels
Previous wording
•emphasizing customer service, product quality and design, and premier locations.
Current wording
•Emphasize customer service, product quality and design, and premier locations
Previous wording
During the nine months ended September 30, 2024, we invested $365.6 million in land acquisitions and $444.7 million in land development compared to $247.6 million and $352.6 million, respectively, during the nine months ended September 30, 2023. We invested in more land acquisitions in the nine months ended September 30, 2024 compared to the third quarter of 2023 in line with the land supply needs of our divisions. We continue to closely review our land acquisition and land development spending and monitor our ongoing pace of home sales and deliveries, and we will adjust our land and investment spend accordingly.
Current wording
During the first three months of 2025, we invested $146.0 million in land acquisitions and $101.6 million in land development compared to $107.7 million and $119.4 million, respectively, during the first three months of 2024. We invested in more land acquisitions in the first quarter of 2025 compared to the first quarter of 2024 as a result of the land supply needs of our divisions. We continue to closely review our land acquisition and land development spending and monitor our ongoing pace of home sales and deliveries, and we will adjust our land and investment spend accordingly.
Previous wording
We ended the third quarter of 2024 with approximately 52,200 lots under control, which represents an approximately six-year supply of lots based on the past twelve months of homes delivered, including certain lots that we anticipate selling to third parties. This represents a 16% increase from our approximately 44,800 lots under control at the end of last year’s third quarter.
Current wording
We ended the first quarter of 2025 with approximately 51,100 lots under control, which represents an approximatelysix-year supply of lots based on the past twelve months of homes delivered, including certain lots that we anticipate selling to third parties. This represents an 8% increase from our approximately 47,500 lots under control at the end of last year’s first quarter.
Previous wording
We opened 57 communities and closed 53 communities in the nine months ended September 30, 2024, ending the third quarter with 217 active communities, compared to 204 at the end of last year’s third quarter. Although the timing of opening new communities and closing existing communities is subject to substantial variation, we expect to grow our average community count by approximately 5% by the end of 2024.
Current wording
We opened 27 communities and closed 21 communities in the first quarter of 2025, ending the first quarter with 226 active communities, compared to 219 at the end of last year’s first quarter. Although the timing of opening new communities and closing existing communities is subject to substantial variation, we expect to grow our average community count by approximately 5% by the end of 2025.
Previous wording
The following table shows, by segment: revenue; gross margin; selling, general and administrative expense; operating income (loss); and interest (income) expense - net for the three and nine months ended September 30, 2024 and 2023:
Current wording
The following table shows, by segment: revenue; cost of sales; selling, general and administrative expense; operating income; and interest (income) expense - net for the three months ended March 31, 2025 and 2024:
Previous wording
The following table presents, by reportable segment, selected operating and financial information as of and for the three and nine months ended September 30, 2024 and 2023:
Current wording
The following table presents, by reportable segment, selected operating and financial information as of and for the three months ended March 31, 2025 and 2024:
Previous wording
The following table sets forth the cancellation rates for each of our homebuilding segments for the three and nine months ended September 30, 2024 and 2023:
Current wording
The following table sets forth the cancellation rates for each of our homebuilding segments for the three months ended March 31, 2025 and 2024:
Previous wording
Northern Region. During the three months ended September 30, 2024, homebuilding revenue in our Northern region increased $150.3 million, from $348.2 million in the third quarter of 2023 to $498.5 million in the third quarter of 2024. This 43% increase in homebuilding revenue was primarily the result of a 37% increase in the number of homes delivered (274 more units), a 5% increase in the average sales price of homes being delivered and the mix of homes being delivered. Operating income in our Northern region increased $31.7 million from $43.8 million in the third quarter of 2023 to $75.5 million during the quarter ended September 30, 2024. This increase in operating income was the result of a $37.8 million improvement in our gross margin partially offset by a $6.1 million increase in selling, general and administrative expense. With respect to our homebuilding gross margin, our housing gross margin improved $37.9 million and our housing gross margin percentage improved 120 basis points to 22.3% in the third quarter of 2024 from 21.1% in the prior year’s third quarter. These improvements were primarily due to the increase in the number of homes delivered in addition to the mix of homes delivered compared to prior year. Our land sale gross margin declined $0.1 million in the third quarter of 2024 compared to the same period in 2023 as a result of the mix of lots sold in the current year compared to the prior year.
Current wording
Northern Region. During the three months ended March 31, 2025, revenue in our Northern region increased $1.9 million, from $408.5 million in the first quarter of 2024 to $410.4 million in the first quarter of 2025. This slight increase in revenue was primarily the result of a 2% increase in the average sales price of homes being delivered and the mix of homes being delivered offset in part by a decrease in number of homes delivered. Operating income in our Northern region increased $2.5 million from $58.1 million in the first quarter of 2024 to $60.6 million during the quarter ended March 31, 2025. This increase in operating income was the result of a $2.1 million improvement in our gross margin and a $0.4 million decrease in selling, general and administrative expense. Our gross margin improved $2.1 million to $90.9 million in the first quarter of 2025 from $88.8 million in the first quarter 2024. Our gross margin percentage improved 0.5% to 22.2% from 21.7% in the prior year’s first quarter. These improvements were primarily due to the mix of homes delivered compared to prior year.
Previous wording
During the three months ended September 30, 2024, we experienced less than 1% increase in new contracts in our Northern region, from 885 in the third quarter of 2023 to 890 in the third quarter of 2024. Homes in backlog increased 7% from 1,397 homes at September 30, 2023 to 1,493 homes at September 30, 2024. The increases in new contracts and backlog were primarily a result of improved demand compared to prior year. Average sales price in backlog increased approximately 3% to $538,000 at September 30, 2024 compared to $521,000 at September 30, 2023 primarily due to the mix of homes being sold. We opened seven new communities in our Northern region during the third quarter of 2024 and 2023. Our monthly absorption rate in our Northern region improved to 3.3 per community in the third quarter of 2024 compared to 2.9 per community in 2023's third quarter due to increased availability of and demand for inventory homes.
Current wording
During the three months ended March 31, 2025, we experienced an 8% decrease in new contracts in our Northern region from 1,162 in the first quarter of 2024 to 1,065 in the first quarter of 2025. Homes in backlog decreased 12% from 1,567 homes at March 31, 2024 to 1,375 homes at March 31, 2025. The decreases in new contracts and backlog were primarily a result of weakened market demand compared to prior year. Average sales price in backlog increased approximately 6% to $556,000 at March 31, 2025 compared to $525,000 at March 31, 2024 primarily due to the mix of homes being sold. During the three months ended March 31, 2025, we opened 16 new communities in our Northern region compared to opening seven during
Previous wording
Southern Region. During the three month period ended September 30, 2024, homebuilding revenue in our Southern region decreased $60.1 million, from $674.5 million in the third quarter of 2023 to $614.4 million in the third quarter of 2024. This 9% decrease in homebuilding revenue was the result of a 7% decrease in the number of homes delivered (99 units) and an $11.8 million decrease in land sales. Operating income in our Southern region decreased $21.5 million from $135.6 million in the third quarter of 2023 to $114.1 million during the quarter ended September 30, 2024. This decrease in operating income was the result of a $16.5 million decline in our gross margin and a $5.0 million increase in selling, general, and administrative expense. With respect to our homebuilding gross margin, our housing gross margin declined $14.5 million, due primarily to the decrease in the number of homes delivered during the period and the mix of homes being delivered compared to prior year. Our housing gross margin percentage declined 10 basis points from 27.6% in prior year’s third quarter to 27.5% in the third quarter of 2024, primarily due to the mix of homes being delivered. Our land sale gross margin declined $2.0 million in the third quarter of 2024 compared to the third quarter of 2023 as a result of no land sales in the current quarter.
Current wording
Southern Region. During the three month period ended March 31, 2025, revenue in our Southern region decreased $77.0 million, from $611.2 million in the first quarter of 2024 to $534.2 million in the first quarter of 2025. This 13% decrease in revenue was the result of a 13% decrease in the number of homes delivered (165 units). Operating income in our Southern region decreased $37.4 million from $117.8 million in the first quarter of 2024 to $80.4 million in the first quarter of 2025. This decrease in operating income was the result of a $37.2 million decline in our gross margin and a $0.2 million increase in selling, general, and administrative expense. Our gross margin declined $37.2 million, due primarily to the decrease in the number of homes delivered during the period and the incentives offered on homes delivered compared to prior year. Our gross margin percentage declined 300 basis points from 27.4% in prior year’s first quarter to 24.4% in the first quarter of 2025, primarily due to the mix of homes being delivered and incentives offered.
Previous wording
During the three months ended September 30, 2024, our new contracts decreased slightly in our Southern region, from 1,136 in the third quarter of 2023 to 1,133 in the third quarter of 2024, which was primarily due to slightly weakened demand. However, homes in backlog decreased by 17% from 2,036 homes at September 30, 2023 to 1,681 homes at September 30, 2024, primarily as a result of improved construction cycle times allowing us to deliver homes in backlog at a faster rate compared to last year and a slight decrease in new contracts. Average sales price in backlog increased to $549,000 at September 30, 2024 from $503,000 at September 30, 2023 primarily due to the mix of homes being sold. During the three months ended September 30, 2024, we opened twelve new communities in our Southern region compared to opening fifteen communities during 2023's third quarter. Our monthly absorption rate in our Southern region declined to 3.1 per community in the third quarter of 2024 compared to 3.8 per community in the third quarter of 2023 as a result of a slight decline in new contracts and a decline in new communities compared to prior year.
Current wording
During the three months ended March 31, 2025, our new contracts decreased in our Southern region, from 1,385 in the first quarter of 2024 to 1,227 in the first quarter of 2025, which was primarily due to weakened market demand. Homes in backlog decreased by 19% from 1,824 homes at March 31, 2024 to 1,472 homes at March 31, 2025, primarily as a result of weakened demand and a shift in demand to inventory homes which offer incentives compared to last year. Average sales price in backlog increased to $540,000 at March 31, 2025 from $530,000 at March 31, 2024 primarily due to the mix of homes being sold. During the three months ended March 31, 2025, we opened 11 new communities in our Southern region compared to opening 14 communities during 2024's first quarter. Our monthly absorption rate in our Southern region declined to 3.2 per community in the first quarter of 2025 compared to 4.0 per community in the first quarter of 2024 as a result of a decrease in new contracts.
Previous wording
Financial Services. Revenue from our mortgage and title operations increased 27% to an all-time quarterly record $30.0 million in the third quarter of 2024 from $23.6 million in the third quarter of 2023 due to higher margins on loans sold during the period compared to prior year’s third quarter and a 15% increase in the number of loan originations from 1,469 in 2023's third quarter to 1,695 in the third quarter of 2024, and an increase in the average loan amount from $394,000 in the quarter ended September 30, 2023 to $403,000 in the quarter ended September 30, 2024.
Current wording
Financial Services. Revenue from our mortgage and title operations increased 17% to an all-time quarterly record $31.5 million in the first quarter of 2025 from $27.0 million in the first quarter of 2024 due to higher margins on loans sold and capture rates during the period compared to prior year’s first quarter and a 2% decrease in the number of loan originations from 1,556 in 2024's first quarter to 1,530 in the first quarter of 2025, and an increase in the average loan amount from $386,000 in the quarter ended March 31, 2024 to $406,000 in the quarter ended March 31, 2025.
Previous wording
Our financial services segment experienced a $4.1 million increase in operating income in the third quarter of 2024 compared to 2023's third quarter, which was primarily due to the increase in revenue discussed above offset, in part, by a $2.3 million increase in selling, general and administrative expense compared to the third quarter of 2023, which was primarily the result of an increase in compensation-related expenses.
Current wording
Our financial services segment experienced a $3.6 million increase in operating income in the first quarter of 2025 compared to 2024's first quarter, which was primarily due to the increase in revenue discussed above offset, in part, by a $1.0 million increase in selling, general and administrative expense compared to the first quarter of 2024, which was primarily the result of an increase in compensation-related expenses.
Previous wording
At September 30, 2024, M/I Financial provided financing services in all of our markets. Approximately 89% of our homes delivered during the third quarter of 2024 were financed through M/I Financial, compared to 86% in the third quarter of 2023. Capture rate is influenced by financing availability and competition in the mortgage market and can fluctuate from quarter to quarter.
Current wording
At March 31, 2025, M/I Financial provided financing services in all of our markets. Approximately 92% of our homes delivered during the first quarter of 2025 were financed through M/I Financial, compared to 88% in the first quarter of 2024. Capture rate is influenced by financing availability and competition in the mortgage market and can fluctuate from quarter to quarter.
Previous wording
Corporate Selling, General and Administrative Expense. Corporate selling, general and administrative expense increased $4.5 million from $19.7 million for the third quarter of 2023 to $24.2 million for the third quarter of 2024. This increase primarily resulted from a $2.9 million increase in compensation-related expenses and a $1.6 million increase in miscellaneous expenses.
Current wording
Corporate Selling, General and Administrative Expense. Corporate selling, general and administrative expense increased $1.1 million from $17.8 million for the first quarter of 2024 to $18.9 million for the first quarter of 2025. This increase resulted from a $1.1 million increase in compensation-related expenses.
Previous wording
Interest Income, net of Interest Expense. The Company earned $6.7 million of interest income - net for the three months ended September 30, 2024 compared to $5.8 million for the three months ended September 30, 2023. This increase was primarily due to a higher average cash balance on hand compared to prior year.
Current wording
Interest Income, net of Interest Expense. The Company earned $5.2 million of interest income - net for the three months ended March 31, 2025 compared to $6.9 million for the three months ended March 31, 2024. This decrease was primarily due to a lower average cash balance on hand compared to prior year.
Previous wording
Income Taxes. Our overall effective tax rate was 22.9% for the three months ended September 30, 2024 and 21.9% for the three months ended September 30, 2023. The increase in the effective tax rate from the three months ended September 30, 2023 was primarily attributable to a $0.8 million decrease in tax benefit from equity compensation in 2024.
Current wording
Income Taxes. Our overall effective tax rate was 23.9% for the three months ended March 31, 2025 and 23.4% for the three months ended March 31, 2024. The increase in the effective tax rate from the three months ended March 31, 2024 was primarily attributable to a $1.2 million decrease in tax benefit from equity compensation in 2025.
Previous wording
At September 30, 2024, we had $719.9 million of cash, cash equivalents and restricted cash (all of which was comprised of unrestricted cash and cash equivalents), which represents a $12.7 million decrease in unrestricted cash and cash equivalents from December 31, 2023. This decrease in cash is primarily due to house closings and the timing of land spend compared to prior year offset by a larger beginning of year balance on hand. Our principal uses of cash for the nine months ended September 30, 2024 were investment in land and land development, construction of homes, mortgage loan originations, investment in joint ventures, operating expenses, short-term working capital, and debt service requirements, including the repayment of amounts outstanding under our credit facilities, and the repurchase of $125.8 million of our outstanding common shares under both the 2021 and 2024 Share Repurchase Programs (as defined below). In order to fund these uses of cash, we used proceeds from home deliveries, the sale of mortgage loans, the sale of mortgage servicing rights, excess cash balances, borrowings under our MIF Mortgage Repurchase Facility (as defined below), and other sources of liquidity.
Current wording
At March 31, 2025, we had $776.4 million of cash, cash equivalents and restricted cash, with approximately $776.1 million of this amount comprised of unrestricted cash and cash equivalents, which represents a $45.3 million decrease in unrestricted cash and cash equivalents from December 31, 2024. This decrease in cash is primarily due to the decline in home deliveries and the timing of land spend compared to prior year offset by a larger beginning of year balance on hand. Our principal uses of cash for the three months ended March 31, 2025 were investment in land and land development, construction of homes, mortgage loan originations, investment in joint ventures, operating expenses, short-term working capital, debt service requirements, including the repayment of amounts outstanding under our credit facilities, and the repurchase of $50.1 million of our outstanding common shares under the 2025 Share Repurchase Programs (as defined below). In order to fund these uses of cash, we used proceeds from home deliveries, the sale of mortgage loans, the sale of mortgage servicing rights, excess cash balances, borrowings under our MIF Mortgage Repurchase Facility (as defined below), and other sources of liquidity.
Previous wording
As of September 30, 2024, we had outstanding notes payable (consisting primarily of notes payable for our financial services operations, the 2030 Senior Notes and the 2028 Senior Notes) with varying maturities in an aggregate principal amount of $935.4 million, with $235.4 million payable within 12 months. Future interest payments associated with these notes payable totaled $134.7 million as of September 30, 2024, with $31.9 million payable within 12 months.
Current wording
As of March 31, 2025, we had outstanding notes payable (consisting primarily of notes payable for our financial services operations, the 2030 Senior Notes and the 2028 Senior Notes) with varying maturities in an aggregate principal amount of $928.0 million, with $228.0 million payable within 12 months. Future interest payments associated with these notes payable totaled $118.9 million as of March 31, 2025, with $31.9 million payable within 12 months.
Previous wording
As of September 30, 2024, there were no borrowings outstanding and $85.2 million of letters of credit outstanding under our $650 million Credit Facility, leaving $564.8 million available. We expect to continue to manage our balance sheet and liquidity carefully during the remainder of 2024 by managing our spending on land acquisition and development and construction of inventory homes, as well as overhead expenditures, relative to our ongoing volume of home deliveries, and we expect to meet our current and anticipated cash requirements in 2024 from cash receipts, excess cash balances and availability under our credit facilities.
Current wording
As of March 31, 2025, there were no borrowings outstanding and $69.4 million of letters of credit outstanding under our $650 million Credit Facility, leaving $580.6 million available. We expect to continue to manage our balance sheet and liquidity carefully during the remainder of 2025 by managing our spending on land acquisition and development and construction of inventory homes, as well as overhead expenditures, relative to our ongoing volume of home deliveries, and we expect to meet our current and anticipated cash requirements in 2025 from cash receipts, excess cash balances and availability under our credit facilities.
Previous wording
During the nine months ended September 30, 2024, we delivered 6,653 homes, started 7,162 homes, ended the quarter with 5,056 homes under construction compared to 4,580 at the end of last year’s third quarter, and spent $365.6 million on land purchases and $444.7 million on land development.
Current wording
During the first quarter of 2025, we delivered 1,976 homes, started 2,077 homes, ended the quarter with 4,800 homes under construction compared to 4,500 at the end of last year’s first quarter, and spent $146.0 million on land purchases and $101.6 million on land development.
Previous wording
We are actively acquiring and developing lots in our markets to replenish our lot supply and will continue to monitor market conditions and our pace of home sales and deliveries and adjust our land spending accordingly. Pursuant to our land option agreements, as of September 30, 2024, we had a total of 28,563 lots under contract, with an aggregate purchase price of approximately $1.39 billion, to be acquired during the remainder of 2024 through 2031.
Current wording
We are actively acquiring and developing lots in our markets to replenish our lot supply and will continue to monitor market conditions and our pace of home sales and deliveries and adjust our land spending accordingly. Pursuant to our land option agreements, as of March 31, 2025, we had a total of 25,887 lots under contract, with an aggregate purchase price of approximately $1.47 billion, to be acquired during the remainder of 2025 through 2031.
Previous wording
Operating Cash Flow Activities. During the nine-month period ended September 30, 2024, we generated $75.3 million of cash from operating activities, compared to generating $497.2 million of cash from operating activities during the nine months ended September 30, 2023. The cash provided by operating activities in the first nine months of 2024 was primarily a result of net income of $430.3 million, and an increase of $67.4 million in accounts payable, customer deposits and other liabilities, offset, in part, by a $335.1 million increase in inventory purchases and payments for mortgage loan originations which exceeded the proceeds from the sale of mortgage loans by $66.4 million, an increase in other assets of $33.4 million, and a decrease in accrued compensation totaling $4.3 million. The cash generated in operating activities during the nine months ended September 30, 2023 was primarily a result of net income of $360.1 million, $34.5 million of proceeds from the sale of mortgage loans net of mortgage loan originations, a $108.6 million decrease in inventory purchases due to delays and timing of land purchases and an increase of $22.3 million in accounts payable, offset, in part, by a decrease in accrued compensation and other liabilities totaling $42.6 million.
Current wording
Operating Cash Flow Activities. During the three-month period ended March 31, 2025, we generated $64.9 million of cash from operating activities, compared to generating $115.8 million of cash from operating activities during the first quarter of 2024. The cash provided by operating activities in the first quarter of 2025 was primarily a result of net income of $111.2 million, and an increase of $72.4 million in accounts payable, customer deposits and other liabilities, proceeds from the sale of mortgage loans which exceeded mortgage loan originations by $50.5 million, offset, in part, by a $107.3 million increase in inventory purchases, an increase in other assets of $12.5 million, and a decrease in accrued compensation totaling $48.9 million. The cash generated in operating activities during the first quarter of 2024 was primarily a result of net income of $138.1 million, a $15.8 million decrease in inventory purchases due to delays and timing of land purchases and an increase of $54.9 million in accounts payable and other liabilities, offset, in part, payments for mortgage loan originations which exceeded the proceeds from the sale of mortgage loans by $61.6 million and a decrease in accrued compensation totaling $40.0 million.
Previous wording
Investing Cash Flow Activities. During the nine months ended September 30, 2024, we used $45.0 million of cash in investing activities, compared to using $14.1 million of cash in investing activities during the nine months ended September 30, 2023.
Current wording
Investing Cash Flow Activities. During the first quarter of 2025, we used $2.9 million of cash in investing activities, compared to using $17.1 million of cash in investing activities during the first quarter of 2024. The cash used in investing activities in the first quarter of 2025 was primarily a result of a $8.3 million increase in our investment in joint venture arrangements and a
Previous wording
The cash used in investing activities in the first nine months of 2024 was primarily a result of a $45.9 million increase in our investment in joint venture arrangements and a $6.4 million increase in property and equipment, offset, in part, by $7.2 million of proceeds from the sale of a portion of our mortgage servicing rights. The cash used in investing activities during the nine months ended September 30, 2023 was primarily a result of a $19.7 million increase in our investment in joint venture arrangements and a $4.6 million increase in property and equipment, offset, in part, by $10.2 million of proceeds from the sale of a portion of our mortgage servicing rights during the second quarter of 2023.
Current wording
$1.3 million increase in property and equipment, offset, in part, by $6.7 million of proceeds from the sale of a portion of our mortgage servicing rights. The cash used in investing activities during the first quarter of 2024 was primarily a result of a $23.7 million increase in our investment in joint venture arrangements offset, in part, by $6.9 million of proceeds from the sale of a portion of our mortgage servicing rights.
Previous wording
Financing Cash Flow Activities. During the nine months ended September 30, 2024, we used $43.2 million of cash in financing activities, compared to using $58.4 million of cash in financing activities during the nine months ended September 30, 2023. The cash used in financing activities in 2024 was primarily due to the repurchase of $125.8 million of our outstanding common shares during the nine months ended September 30, 2024, offset partially by proceeds from borrowings (net of repayments) under our MIF Mortgage Repurchase Facility of $69.6 million and $13.0 million in proceeds from the exercise of stock options during the nine months ended September 30, 2024. The cash used in financing activities in the first nine months of 2023 was primarily due to repayments of $45.1 million (net of proceeds from borrowings) under our two then-outstanding M/I Financial credit facilities and the repurchase of $40.3 million of our outstanding common shares during the first nine months of 2023, offset partially by the $27.2 million in proceeds from the exercise of stock options during the first nine months of 2023.
Current wording
Financing Cash Flow Activities. During the three months ended March 31, 2025, we used $107.2 million of cash in financing activities, compared to generating $38.7 million of cash in financing activities during the first three months of 2024. The cash used in financing activities in 2025 was primarily due to the repurchase of $50.1 million of our outstanding common shares during the first quarter of 2025, and repayments (net of borrowings) under our MIF Mortgage Repurchase Facility of $58.2 million offset partially by $1.1 million in proceeds from the exercise of stock options during the first quarter of 2025. The cash provided by financing activities in the first quarter of 2024 was primarily due to proceeds from borrowings (net of repayments) under our M/I Financial credit facility of $58.5 million and $5.5 million in proceeds from the exercise of stock options during the first quarter of 2024, offset partially by the repurchase of $25.3 million of our outstanding common shares during the first quarter of 2024.
Previous wording
On May 14, 2024, the Company announced that its Board of Directors authorized a new share repurchase program pursuant to which the Company was permitted to purchase up to $250 million of its outstanding common shares (the “2024 Share Repurchase Program”), which replaced the 2021 Share Repurchase Program which had $95 million of remaining availability at the time. During the nine months ended September 30, 2024, the Company repurchased 0.9 million outstanding common shares for an aggregate purchase price of $125.8 million under both the 2021 and the 2024 Share Repurchase Programs which was funded with cash on hand. As of September 30, 2024, the Company is authorized to repurchase an additional $156.9 million of outstanding common shares under the 2024 Share Repurchase Program (see Note 12 to our financial statements for more information).
Current wording
On February 11, 2025, the Company announced that its Board of Directors authorized a new share repurchase program pursuant to which the Company was permitted to purchase up to $250 million of its outstanding common shares (the “2025 Share Repurchase Program”), which replaced the 2024 Share Repurchase Program. During the first quarter of 2025, the Company repurchased 0.4 million outstanding common shares for an aggregate purchase price of $50.1 million under the 2025 Share Repurchase Program which was funded with cash on hand. As of March 31, 2025, the Company is authorized to repurchase an additional $199.9 million of outstanding common shares under the 2025 Share Repurchase Program (see Note 12 to our financial statements for more information).
Previous wording
Based on current market conditions, expected capital needs and availability, and the current market price of the Company’s common shares, we expect to continue repurchasing shares during the remainder of 2024. The timing and amount of any future purchases under the 2024 Share Repurchase Program will be based on a variety of factors, including the market price of the Company’s common shares, business considerations, general market and economic conditions and legal requirements.
Current wording
Based on current market conditions, expected capital needs and availability, and the current market price of the Company’s common shares, we expect to continue repurchasing common shares during the remainder of 2025. The timing and amount of any future purchases under the 2025 Share Repurchase Program will be based on a variety of factors, including the market price of the Company’s common shares, business considerations, general market and economic conditions and legal requirements.
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Previous report — wording carried elsewhere
At September 30, 2024, M/I Financial provided financing services in all of our markets. Approximately 88% of our homes delivered during the nine months ended September 30, 2024 were financed through M/I Financial, compared to 82% during the nine months ended September 30, 2023. Capture rate is influenced by financing availability and can fluctuate from quarter to quarter.
Previous report — wording carried elsewhere
Interest Income, net of Interest Expense. The Company earned $20.9 million of interest income - net for the nine months ended September 30, 2024 compared to $11.9 million for the nine months ended September 30, 2023. This was primarily due to a higher average cash balance on hand compared to prior year.