Exhibit 99.1
mhlogo1linetaga04.jpg
 
 
 
 
 
 
 
 
Contacts:
Brent Anderson, VP Investor Relations
 
 
 
(972) 580-6360 (office)
 
 
 
investors@meritagehomes.com

Meritage Homes reports third quarter 2017 diluted EPS of $1.02, with an 18% increase in pretax earnings driven by higher revenue and home closing margins


SCOTTSDALE, Ariz., October 27, 2017 - Meritage Homes Corporation (NYSE: MTH), a leading U.S. homebuilder, reported its third quarter results for the period ended September 30, 2017.

Summary Operating Results (unaudited)
(Dollars in thousands, except per share amounts)
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2017
 
2016
 
% Chg
 
2017
 
2016
 
% Chg
Homes closed (units)
 
1,969

 
1,800

 
9
 %
 
5,456

 
5,238

 
4
 %
Home closing revenue
 
$
805,008

 
$
735,870

 
9
 %
 
$
2,263,405

 
$
2,127,332

 
6
 %
Average sales price - closings
 
$
409

 
$
409

 
—
 %
 
$
415

 
$
406

 
2
 %
Home orders (units)
 
1,874

 
1,737

 
8
 %
 
6,162

 
5,797

 
6
 %
Home order value
 
$
765,027

 
$
715,562

 
7
 %
 
$
2,536,448

 
$
2,365,508

 
7
 %
Average sales price - orders
 
$
408

 
$
412

 
(1
)%
 
$
412

 
$
408

 
1
 %
Ending backlog (units)
 
 
 
 
 
 
 
3,333

 
3,251

 
3
 %
Ending backlog value
 
 
 
 
 
 
 
$
1,408,801

 
$
1,375,857

 
2
 %
Average sales price - backlog
 


 


 


 
$
423

 
$
423

 
—
 %
Earnings before income taxes
 
$
63,455

 
$
53,802

 
18
 %
 
$
163,429

 
$
141,723

 
15
 %
Net earnings
 
$
42,550

 
$
36,887

 
15
 %
 
$
107,702

 
$
97,734

 
10
 %
Diluted EPS
 
$
1.02

 
$
0.88

 
16
 %
 
$
2.55

 
$
2.33

 
9
 %




1


MANAGEMENT COMMENTS
“We are pleased with our results for the third quarter of 2017, despite the disruptions caused by the hurricanes that hit Houston and Florida, " said Steven J. Hilton, chairman and chief executive officer of Meritage Homes. "We grew our third quarter orders, home closings and revenue year-over-year, increased sales productivity in our East region, and made good progress on our strategic initiatives to expand earnings by improving our gross margins and managing overhead expenses for additional leverage. Our home closing margin improved to 18.1% and our overhead leverage improved by 80 basis points, helping to drive an 18% increase in pre-tax earnings and a 16% improvement in diluted earnings per share compared to last year's third quarter."
Mr. Hilton continued, “Considering the results we’ve achieved in the first nine months of the year and adjusting for delays due to weather events, we are modestly reducing our closings and revenue guidance while maintaining our 2017 earnings expectations due to our strong third quarter performance. We expect to deliver approximately 7,600-7,800 homes and closing revenue of $3.15-3.25 billion for the year. On that level of closings and revenue, we are maintaining our expectations for approximately $235-245 million in pre-tax earnings with full year 2017 gross margin in line with 2016.”
He concluded, "Demand continues to be healthy across all of our markets, especially for our entry-level and LiVE.NOW. homes. More than ever, buyers appreciate that they can get Meritage's quality, energy efficiency and advanced technology in affordably-priced homes. As we continue to execute our strategy to serve the growing population of first-time buyers, we foresee additional growth opportunities for Meritage."

THIRD QUARTER RESULTS
•
Net earnings of $42.6 million ($1.02 per diluted share) for the third quarter of 2017, compared to prior year net earnings of $36.9 million ($0.88 per diluted share), primarily reflect higher home closing revenue and gross margins, combined with cost controls and improved overhead leverage. Earnings before income taxes increased 18% year-over-year.
•
The third quarter effective tax rate was 33% in 2017, compared to 31% in 2016. The lower rate in 2016 reflected the impact of energy tax credits captured on energy-efficient homes closed in 2016 and prior periods, which Congress has not extended for 2017, resulting in a higher projected effective tax rate this year.
•
Home closing revenue increased 9% over the prior year on higher closing volume. Despite increases in market prices of homes over 2016, average closing prices remained constant with the third quarter of 2016, as a higher percentage of home closings were lower-priced entry-level homes, consistent with the Company’s strategic

2


focus. Both the West and Central regions delivered 19% year-over-year increases in home closing revenue, reflecting strong growth in Arizona and Texas. A 12% decline in East region home closing revenue reflected 14% fewer closings due to fewer orders during the first half of 2017 than 2016, as well as delays due to Hurricane Irma.
•
Home closing gross margins increased to 18.1% for the third quarter of 2017, compared to 17.8% in the third quarter of 2016 and 17.7% in the second quarter of 2017. The margin improvement reflects higher margins in Texas and the West Region as well as improved leverage of construction overhead expenses overall.
•
Selling, general and administrative expenses totaled 10.9% of home closing revenue, an 80 bps improvement from 11.7% in the third quarter of 2016, reflecting successful cost controls and greater overhead leverage.
•
Total orders for the third quarter increased 8% year-over-year due to strong demand in Texas and improved sales execution in the East region. Orders increased 22% over the third quarter of 2016 in Texas, primarily due to a 26% increase in average active communities over the prior year. Total orders increased 13% in the East, primarily due to a 12% increase in absorptions (orders per average active community) during the quarter. Three of the five states in the region produced 20% or greater order growth over the third quarter of 2016, reflecting positive acceptance of new products in new communities, as well as better sales execution. A 7% decrease in average active communities in the West region resulted in a 6% decline in third-quarter orders for the region.
•
Total active community count was 250 at September 30, 2017, compared to 237 communities open at September 30, 2016, which translated to a 6% year-over-year increase in average active communities for the third quarter.
•
Average sales prices on closings and orders were consistent with the prior year, as general home price appreciation in many markets offset the growing percentage of entry-level homes relative to move-up.
YEAR TO DATE RESULTS
•
Net earnings increased to $107.7 million for the first three quarters of 2017, compared to $97.7 million for the first three quarters of 2016, with a 15% increase in pretax earnings.
•
Earnings growth year-to-date was primarily driven by a 6% increase in home closing revenue, resulting from a 4% increase in home closings and a 2% increase in average closing prices over 2016.
•
Higher home closing revenue led to a $21.8 million increase in home closing gross profit to $393.8 million in the first three quarters of 2017, compared to $372.1 million in the first three quarters of 2016, as home closing gross margins were relatively consistent in both years.

3


•
Total commissions and selling expenses improved by 30 basis points to 7.0% of year-to-date 2017 home closing revenue from 7.3% in 2016. In addition, total general and administrative expenses also declined 30 basis points to 4.0% of home closing revenue in the first three quarters of 2017, compared to 4.3% in 2016, resulting in a total improvement of 60 basis points in year-to-date selling, general and administrative expenses.
•
The effective tax rate for the first three quarters of 2017 was 34%, compared to 31% for the first three quarters of 2016, due to the expiration of energy tax credits that reduced the rate in 2016, but were unavailable in 2017.
BALANCE SHEET
•
Cash and cash equivalents at September 30, 2017, totaled $115.2 million, compared to $131.7 million at December 31, 2016, primarily reflecting the use of cash to fund the purchase and development of lots, as well as additional homes under construction, to meet Meritage's growth targets. Proceeds from the issuance of $300 million in new senior notes in June 2017 were used to repay borrowings under the Company’s revolving credit facility and to retire all $126.5 million of the Company's 1.875% convertible senior notes.
•
A total of $285.6 million was invested in land and development during the third quarter of 2017 to meet current demand and position the company for future growth. Total spending on land and development year-to-date was $771.1 million in 2017, compared to $667.2 million through the third quarter of 2016.
•
Meritage ended the third quarter of 2017 with approximately 33,300 total lots owned or under control, compared to approximately 28,800 total lots at September 30, 2016, as the Company secured more than 2,400 new lots during the quarter. Approximately half of those additions were in Texas to meet continued strong demand, and approximately 70% of the newly controlled lots added during the quarter were for entry-level communities.
•
Debt-to-capital and net debt-to-capital ratios at September 30, 2017, were 45.9% and 43.6%, compared to 44.2% and 41.2%, respectively, at December 31, 2016, reflect the increased investment of cash into homes and land under development, while remaining well within management’s target range for this key ratio.
CONFERENCE CALL
Management will host a conference call at 11:00 a.m. Eastern Time (8:00 a.m. in Arizona) today to discuss the Company's results. The call will be webcast with an accompanying slideshow available on the "Investor Relations" page of the Company's website at http://investors.meritagehomes.com. Telephone participants may avoid any delays by pre-registering for the call using the following link to receive a special dial-in number and PIN.
Conference Call registration link: http://dpregister.com/10112737.

4


Telephone participants who are unable to pre-register may dial in on 866-226-4948 on the day of the call. International dial-in number is 1-412-902-4125 or 1-855-669-9657 for Canada.
A replay of the call will be available beginning at approximately 1:00 p.m. ET on October 27 and extending through November 15, 2017, on the website noted above or by dialing 877-344-7529, 1-412-317-0088 for international or 1-855-669-9658 for Canada, and referencing conference number 10112737.


5



Meritage Homes Corporation and Subsidiaries
Consolidated Income Statements
(In thousands, except per share data)
(Unaudited)

 
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2017
 
2016
 
2017
 
2016
Homebuilding:
 
 
 
 
 
 
 
 
Home closing revenue
$
805,008

 
$
735,870

 
$
2,263,405

 
$
2,127,332

 
Land closing revenue
589

 
16,987

 
16,942

 
21,187

 
Total closing revenue
805,597

 
752,857

 
2,280,347

 
2,148,519

 
Cost of home closings
(659,350
)
 
(604,891
)
 
(1,869,569
)
 
(1,755,260
)
 
Cost of land closings
(1,646
)
 
(16,092
)
 
(15,504
)
 
(19,485
)
 
Total cost of closings
(660,996
)
 
(620,983
)
 
(1,885,073
)
 
(1,774,745
)
 
Home closing gross profit
145,658

 
130,979

 
393,836

 
372,072

 
Land closing gross (loss)/profit
(1,057
)
 
895

 
1,438

 
1,702

 
Total closing gross profit
144,601

 
131,874

 
395,274

 
373,774

Financial Services:
 
 
 
 
 
 
 
 
Revenue
3,549

 
3,139

 
10,142

 
9,115

 
Expense
(1,524
)
 
(1,398
)
 
(4,454
)
 
(4,152
)
 
Earnings from financial services unconsolidated entities and other, net
3,489

 
4,215

 
9,673

 
10,802

 
Financial services profit
5,514

 
5,956

 
15,361

 
15,765

Commissions and other sales costs
(55,845
)
 
(52,478
)
 
(158,866
)
 
(155,034
)
General and administrative expenses
(31,636
)
 
(33,258
)
 
(90,849
)
 
(91,774
)
(Loss)/earnings from other unconsolidated entities, net
(91
)
 
440

 
852

 
856

Interest expense
(1,116
)
 
(167
)
 
(3,561
)
 
(5,127
)
Other income, net
2,028

 
1,435

 
5,218

 
3,263

Earnings before income taxes
63,455

 
53,802

 
163,429

 
141,723

Provision for income taxes
(20,905
)
 
(16,915
)
 
(55,727
)
 
(43,989
)
Net earnings
$
42,550

 
$
36,887

 
$
107,702

 
$
97,734

 
 
 
 
 
 
 
 
Earnings per share:
 
 
 
 
 
 
 
 
Basic
 
 
 
 
 
 
 
 
Earnings per share
$
1.06

 
$
0.92

 
$
2.67

 
$
2.45

 
Weighted average shares outstanding
40,323

 
40,022

 
40,273

 
39,958

 
Diluted
 
 
 
 
 
 
 
 
Earnings per share
$
1.02

 
$
0.88

 
$
2.55

 
$
2.33

 
Weighted average shares outstanding
42,011

 
42,608

 
42,585

 
42,541





6



Meritage Homes Corporation and Subsidiaries
Consolidated Balance Sheets
(In thousands)
(Unaudited)
 
 
 
September 30, 2017
 
December 31, 2016
Assets:
 
 
 
 
Cash and cash equivalents
 
$
115,167

 
$
131,702

Other receivables
 
78,933

 
70,355

Real estate (1)
 
2,762,269

 
2,422,063

Real estate not owned
 
39,793

 
—

Deposits on real estate under option or contract
 
67,547

 
85,556

Investments in unconsolidated entities
 
16,378

 
17,097

Property and equipment, net
 
32,080

 
33,202

Deferred tax asset
 
56,870

 
53,320

Prepaids, other assets and goodwill
 
83,121

 
75,396

Total assets
 
$
3,252,158

 
$
2,888,691

Liabilities:
 
 
 
 
Accounts payable
 
$
140,492

 
$
140,682

Accrued liabilities
 
193,102

 
170,852

Home sale deposits
 
39,446

 
28,348

Liabilities related to real estate not owned
 
35,768

 
—

Loans payable and other borrowings
 
38,082

 
32,195

Senior and convertible senior notes, net
 
1,266,160

 
1,095,119

Total liabilities
 
1,713,050

 
1,467,196

Stockholders' Equity:
 
 
 
 
Preferred stock
 
—

 
—

Common stock
 
403

 
400

Additional paid-in capital
 
582,414

 
572,506

Retained earnings
 
956,291

 
848,589

Total stockholders’ equity
 
1,539,108

 
1,421,495

Total liabilities and stockholders’ equity
 
$
3,252,158

 
$
2,888,691


(1) Real estate – Allocated costs:
 
 
 
 
Homes under contract under construction
 
$
677,456

 
$
508,927

Unsold homes, completed and under construction
 
484,701

 
431,725

Model homes
 
140,326

 
147,406

Finished home sites and home sites under development
 
1,459,786

 
1,334,005

Total real estate
 
$
2,762,269

 
$
2,422,063






7


Supplemental Information and Non-GAAP Financial Disclosures (Dollars in thousands – unaudited):
 
    
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2017
 
2016
 
2017
 
2016
Depreciation and amortization
$
4,199

 
$
3,870

 
$
12,071

 
$
11,470

 
 
 
 
 
 
 
 
Summary of Capitalized Interest:
 
 
 
 
 
 
 
Capitalized interest, beginning of period
$
72,327

 
$
64,682

 
$
68,196

 
$
61,202

Interest incurred
21,024

 
17,372

 
58,199

 
52,644

Interest expensed
(1,116
)
 
(167
)
 
(3,561
)
 
(5,127
)
Interest amortized to cost of home and land closings
(15,462
)
 
(14,256
)
 
(46,061
)
 
(41,088
)
Capitalized interest, end of period
$
76,773

 
$
67,631

 
$
76,773

 
$
67,631

 
 
 
 
 
 
 
 
 
September 30, 2017
 
December 31, 2016
 
 
 
 
Notes payable and other borrowings
$
1,304,242

 
$
1,127,314

 
 
 
 
Stockholders' equity
1,539,108

 
1,421,495

 
 
 
 
Total capital
2,843,350

 
2,548,809

 
 
 
 
Debt-to-capital
45.9
%
 
44.2
%
 
 
 
 
Notes payable and other borrowings
$
1,304,242

 
$
1,127,314

 
 
 
 
Less: cash and cash equivalents
$
(115,167
)
 
$
(131,702
)
 
 
 
 
Net debt
1,189,075

 
995,612

 
 
 
 
Stockholders’ equity
1,539,108

 
1,421,495

 
 
 
 
Total net capital
$
2,728,183

 
$
2,417,107

 
 
 
 
Net debt-to-capital
43.6
%
 
41.2
%
 
 
 

 



8


Meritage Homes Corporation and Subsidiaries
Consolidated Statements of Cash Flows 
(In thousands)
(Unaudited)
 
 
Nine Months Ended September 30,
 
 
2017
 
2016
Cash flows from operating activities:
 
 
 
 
Net earnings
 
$
107,702

 
$
97,734

Adjustments to reconcile net earnings to net cash used in operating activities:
 
 
 
 
Depreciation and amortization
 
12,071

 
11,470

Stock-based compensation
 
9,898

 
11,042

Excess income tax provision from stock-based awards
 
—

 
540

Equity in earnings from unconsolidated entities
 
(10,525
)
 
(11,658
)
Distribution of earnings from unconsolidated entities
 
10,410

 
11,439

Other
 
1,265

 
4,942

Changes in assets and liabilities:
 
 
 
 
Increase in real estate
 
(336,069
)
 
(318,490
)
Decrease/(increase) in deposits on real estate under option or contract
 
13,633

 
(3,160
)
Increase in other receivables, prepaids and other assets
 
(15,207
)
 
(14,201
)
Increase in accounts payable and accrued liabilities
 
21,298

 
61,206

Increase in home sale deposits
 
11,098

 
791

Net cash used in operating activities
 
(174,426
)
 
(148,345
)
Cash flows from investing activities:
 
 
 
 
Investments in unconsolidated entities
 
(404
)
 
(242
)
Distributions of capital from unconsolidated entities
 
1,250

 
—

Purchases of property and equipment
 
(12,038
)
 
(12,256
)
Proceeds from sales of property and equipment
 
251

 
144

Maturities/sales of investments and securities
 
1,297

 
645

Payments to purchase investments and securities
 
(1,297
)
 
(645
)
Net cash used in investing activities
 
(10,941
)
 
(12,354
)
Cash flows from financing activities:
 
 
 
 
Proceeds from Credit Facility, net
 
10,000

 
25,000

Repayment of loans payable and other borrowings
 
(10,491
)
 
(18,286
)
Repurchase of convertible senior notes
 
(126,691
)
 
—

Proceeds from issuance of senior notes
 
300,000

 
—

Payment of debt issuance costs
 
(3,986
)
 
—

Excess income tax provision from stock-based awards
 
—

 
(540
)
Proceeds from stock option exercises
 
—

 
232

Net cash provided by financing activities
 
168,832

 
6,406

Net decrease in cash and cash equivalents
 
(16,535
)
 
(154,293
)
Beginning cash and cash equivalents
 
131,702

 
262,208

Ending cash and cash equivalents
 
$
115,167

 
$
107,915

 


9


Meritage Homes Corporation and Subsidiaries
Operating Data
(Dollars in thousands)
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
 
2017
 
2016
 
 
Homes
 
Value
 
Homes
 
Value
Homes Closed:
 
 
 
 
 
 
 
 
Arizona
 
424

 
$
141,249

 
253

 
$
89,092

California
 
261

 
154,731

 
251

 
142,056

Colorado
 
135

 
77,728

 
167

 
84,114

West Region
 
820

 
373,708

 
671

 
315,262

Texas
 
647

 
236,759

 
542

 
199,499

Central Region
 
647

 
236,759

 
542

 
199,499

Florida
 
185

 
77,652

 
206

 
85,647

Georgia
 
95

 
29,019

 
83

 
27,477

North Carolina
 
107

 
48,129

 
177

 
71,641

South Carolina
 
74

 
25,164

 
76

 
22,658

Tennessee
 
41

 
14,577

 
45

 
13,686

East Region
 
502

 
194,541

 
587

 
221,109

Total
 
1,969

 
$
805,008

 
1,800

 
$
735,870

Homes Ordered:
 
 
 
 
 
 
 
 
Arizona
 
348

 
$
116,757

 
345

 
$
116,815

California
 
200

 
124,339

 
216

 
125,920

Colorado
 
92

 
55,459

 
121

 
66,213

West Region
 
640

 
296,555

 
682

 
308,948

Texas
 
593

 
213,241

 
488

 
178,934

Central Region
 
593

 
213,241

 
488

 
178,934

Florida
 
269

 
120,243

 
208

 
95,946

Georgia
 
102

 
33,039

 
85

 
28,841

North Carolina
 
147

 
59,976

 
149

 
61,537

South Carolina
 
86

 
28,449

 
71

 
22,434

Tennessee
 
37

 
13,524

 
54

 
18,922

East Region
 
641

 
255,231

 
567

 
227,680

Total
 
1,874

 
$
765,027

 
1,737

 
$
715,562


10


 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30,
 
 
2017
 
2016
 
 
Homes
 
Value
 
Homes
 
Value
Homes Closed:
 
 
 
 
 
 
 
 
Arizona
 
1,139

 
$
382,814

 
749

 
$
258,139

California
 
702

 
427,095

 
738

 
418,834

Colorado
 
417

 
233,377

 
474

 
231,913

West Region
 
2,258

 
1,043,286

 
1,961

 
908,886

Texas
 
1,752

 
637,147

 
1,563

 
566,377

Central Region
 
1,752

 
637,147

 
1,563

 
566,377

Florida
 
518

 
225,674

 
619

 
252,311

Georgia
 
223

 
74,860

 
229

 
76,874

North Carolina
 
370

 
164,596

 
474

 
198,525

South Carolina
 
217

 
75,085

 
231

 
71,577

Tennessee
 
118

 
42,757

 
161

 
52,782

East Region
 
1,446

 
582,972

 
1,714

 
652,069

Total
 
5,456

 
$
2,263,405

 
5,238

 
$
2,127,332

Homes Ordered:
 
 
 
 
 
 
 
 
Arizona
 
1,148

 
$
380,459

 
935

 
$
322,807

California
 
802

 
480,694

 
775

 
442,863

Colorado
 
368

 
214,532

 
459

 
237,237

West Region
 
2,318

 
1,075,685

 
2,169

 
1,002,907

Texas
 
2,000

 
719,656

 
1,629

 
597,947

Central Region
 
2,000

 
719,656

 
1,629

 
597,947

Florida
 
791

 
342,754

 
702

 
295,453

Georgia
 
270

 
88,306

 
305

 
102,392

North Carolina
 
440

 
187,683

 
497

 
205,562

South Carolina
 
224

 
76,827

 
296

 
95,123

Tennessee
 
119

 
45,537

 
199

 
66,124

East Region
 
1,844

 
741,107

 
1,999

 
764,654

Total
 
6,162

 
$
2,536,448

 
5,797

 
$
2,365,508

 
 
 
 
 
 
 
 
 
Order Backlog:
 
 
 
 
 
 
 
 
Arizona
 
453

 
$
158,988

 
503

 
$
182,574

California
 
331

 
207,237

 
326

 
208,175

Colorado
 
224

 
135,239

 
317

 
167,475

West Region
 
1,008

 
501,464

 
1,146

 
558,224

Texas
 
1,179

 
437,243

 
1,008

 
381,764

Central Region
 
1,179

 
437,243

 
1,008

 
381,764

Florida
 
526

 
233,534

 
370

 
161,148

Georgia
 
138

 
46,809

 
171

 
58,944

North Carolina
 
263

 
110,339

 
283

 
118,515

South Carolina
 
123

 
42,378

 
153

 
53,657

Tennessee
 
96

 
37,034

 
120

 
43,605

East Region
 
1,146

 
470,094

 
1,097

 
435,869

Total
 
3,333

 
$
1,408,801

 
3,251

 
$
1,375,857



11


Meritage Homes Corporation and Subsidiaries
Operating Data
(Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30,
 
 
2017
 
2016
 
 
Ending
 
Average
 
Ending
 
Average
Active Communities:
 
 
 
 
 
 
 
 
Arizona
 
40

 
39.5

 
40

 
41.5

California
 
24

 
25.0

 
29

 
27.0

Colorado
 
9

 
9.5

 
10

 
11.0

West Region
 
73

 
74.0

 
79

 
79.5

Texas
 
93

 
92.5

 
74

 
73.5

Central Region
 
93

 
92.5

 
74

 
73.5

Florida
 
29

 
29.5

 
26

 
26.0

Georgia
 
17

 
18.0

 
17

 
17.0

North Carolina
 
18

 
19.0

 
19

 
20.5

South Carolina
 
14

 
14.0

 
15

 
15.5

Tennessee
 
6

 
6.5

 
7

 
7.0

East Region
 
84

 
87.0

 
84

 
86.0

Total
 
250

 
253.5

 
237

 
239.0


 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30,
 
 
2017
 
2016
 
 
Ending
 
Average
 
Ending
 
Average
Active Communities:
 
 
 
 
 
 
 
 
Arizona
 
40

 
41.0

 
40

 
40.5

California
 
24

 
26.0

 
29

 
26.5

Colorado
 
9

 
9.5

 
10

 
13.0

West Region
 
73

 
76.5

 
79

 
80.0

Texas
 
93

 
86.5

 
74

 
73.0

Central Region
 
93

 
86.5

 
74

 
73.0

Florida
 
29

 
28.0

 
26

 
28.5

Georgia
 
17

 
17.0

 
17

 
17.0

North Carolina
 
18

 
17.5

 
19

 
22.5

South Carolina
 
14

 
14.5

 
15

 
16.5

Tennessee
 
6

 
6.5

 
7

 
8.0

East Region
 
84

 
83.5

 
84

 
92.5

Total
 
250

 
246.5

 
237

 
245.5




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About Meritage Homes Corporation
Meritage Homes is the eighth-largest public homebuilder in the United States, based on homes closed in 2016. 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, 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 over 100,000 homes in its 32-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 every year since 2013 for innovation and industry leadership in energy efficient homebuilding.
For more information, visit www.meritagehomes.com.
The information included in this press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include management's projected home closings, home closing revenue, gross margins and pre-tax earnings for the full year 2017, as well as expected future growth and earnings expansion opportunities.
Such statements are based on the current beliefs and expectations of Company management, and current market conditions, which are subject to significant uncertainties and fluctuations. 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: potential adverse impacts on our Houston and Florida sales, closings, revenue and costs due to Hurricanes Harvey and Irma; the availability and cost of finished lots and undeveloped land; changes in interest rates and the availability and pricing of residential mortgages; the success of strategic initiatives; shortages in the availability and cost of labor; changes in tax laws that adversely impact us or our homebuyers; the ability of our potential buyers to sell their existing homes; cancellation rates; inflation in the cost of materials used to develop

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communities and construct homes; the adverse effect of slow 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 earnest or option deposits; our potential exposure to and impacts from natural disasters or severe weather conditions; competition; construction defect and home warranty claims; 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; enactment of new laws or regulations or our failure to comply with laws and regulations; our limited 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; the effect of legislative and other governmental actions, orders, policies or initiatives that impact housing, labor availability, construction, mortgage availability, our access to capital, the cost of capital or the economy in general, 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, 2016 and our subsequent Forms 10-Q, under the caption "Risk Factors," which can be found on our website.


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