Quarterly report pursuant to Section 13 or 15(d)

Operating and Reporting Segments

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Operating and Reporting Segments
 6 Months Ended
Jun. 30, 2011
Operating and Reporting Segments [Abstract]  
OPERATING AND REPORTING SEGMENTS
NOTE 10 — OPERATING AND REPORTING SEGMENTS
As defined in ASC 280-10, Segment Reporting, we have seven operating segments (the seven states in which we operate). These segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes, and providing warranty and customer service. We aggregate our operating segments into a reporting segment based on similar long-term economic characteristics and geographical proximity. Our reporting segments are as follows:
     
West:
  California and Nevada
Central:
  Texas, Arizona and Colorado
East:
  Florida and North Carolina
Management’s evaluation of segment performance is based on segment operating income/(loss), which we define as homebuilding and land revenue less cost of home construction, commissions and other sales costs, land development and other land sales costs and other costs incurred by or allocated to each segment, including impairments. Each reportable segment follows the same accounting policies described in Note 1, “Organization and Basis of Presentation,” to the consolidated financial statements in our 2010 Annual Report on Form 10-K. Operating results for each segment may not be indicative of the results for such segment had it been an independent, stand-alone entity. The following is our segment information (in thousands):
                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2011     2010     2011     2010  
Revenue (1):
                               
West
  $ 31,210     $ 38,515     $ 55,360     $ 79,919  
Central
    169,182       228,870       301,688       374,024  
East
    19,739       24,020       40,672       39,266  
 
                       
Consolidated total
    220,131       291,405       397,720       493,209  
 
                       
 
                               
Operating income/(loss) (2):
                               
West
    537       217       (447 )     3,158  
Central
    7,849       18,530       12,075       25,616  
East
    2,004       1,807       4,241       3,115  
 
                       
 
                               
Segment operating income
    10,390       20,554       15,869       31,889  
Corporate and unallocated (3)
    (4,646 )     (5,993 )     (10,177 )     (10,987 )
Earnings from unconsolidated entities, net
    1,226       1,786       2,134       2,589  
Interest expense
    (7,496 )     (8,553 )     (15,519 )     (16,848 )
Other income, net
    1,273       51       1,996       3,983  
Loss on extinguishment of debt
    0       (3,454 )     0       (3,454 )
 
                       
 
                               
Income/(loss) before income taxes
  $ 747     $ 4,391     $ (5,697 )   $ 7,172  
 
                       
 
(1)   Revenue includes the following land closing revenue, by segment: six months ended June 30, 2011 — $100,000 in Central Region; six months ended June 30, 2010 — $1.2 million in Central Region.
 
(2)   See Note 2 of this Quarterly Report on Form 10-Q for a breakout of real estate-related impairments by region.
 
(3)   Balance consists primarily of corporate costs and numerous shared service functions such as finance and treasury that are not allocated to the reporting segments.
                                         
    At June 30, 2011  
                            Corporate and        
    West     Central     East     Unallocated (1)     Total  
Deposits on real estate under option or contract
  $ 975     $ 10,028     $ 807     $ 0     $ 11,810  
Real estate
    202,364       515,158       58,706       0       776,228  
Investments in unconsolidated entities
    176       10,382       30       351       10,939  
Other assets
    6,942       36,814       9,920       373,116       426,792  
 
                             
Total assets
  $ 210,457     $ 572,382     $ 69,463     $ 373,467     $ 1,225,769  
 
                             
                                         
    At December 31, 2010  
                            Corporate and        
    West     Central     East     Unallocated (1)     Total  
Deposits on real estate under option or contract
  $ 50     $ 9,754     $ 555     $ 0     $ 10,359  
Real estate
    191,882       499,176       47,870       0       738,928  
Investments in unconsolidated entities
    110       10,507       29       341       10,987  
Other assets
    3,501       32,961       7,873       420,329       464,664  
 
                             
Total assets
  $ 195,543     $ 552,398     $ 56,327     $ 420,670     $ 1,224,938  
 
                             
 
(1)   Balance consists primarily of cash and other corporate assets not allocated to the reporting segments.