Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Entity Information [Line Items] | ||
Entity Central Index Key | 0001580670 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Entity File Number | 001-36126 | |
Entity Registrant Name | LGI HOMES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-3088013 | |
Entity Address, Address Line One | 1450 Lake Robbins Drive, | |
Entity Address, Address Line Two | Suite 430, | |
Entity Address, City or Town | The Woodlands, | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77380 | |
City Area Code | (281) | |
Local Phone Number | 362-8998 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | LGIH | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 24,934,429 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
ASSETS | ||
Cash and cash equivalents | $ 48,157 | $ 35,942 |
Accounts receivable | 59,229 | 115,939 |
Real estate inventory | 1,609,693 | 1,569,489 |
Pre-acquisition costs and deposits | 39,488 | 37,213 |
Property and equipment, net | 6,160 | 3,618 |
Other assets | 47,391 | 44,882 |
Deferred tax assets, net | 3,350 | 6,986 |
Goodwill | 12,018 | 12,018 |
Total assets | 1,825,486 | 1,826,087 |
LIABILITIES AND EQUITY | ||
Accounts payable | 41,552 | 13,676 |
Accrued expenses and other liabilities | 151,348 | 135,008 |
Notes payable | 413,948 | 538,398 |
Total liabilities | 606,848 | 687,082 |
COMMITMENTS AND CONTINGENCIES | ||
EQUITY | ||
Common stock, par value $0.01, 250,000,000 shares authorized, 26,908,643 shares issued and 24,934,429 shares outstanding as of March 31, 2021 and 26,741,554 shares issued and 24,983,561 shares outstanding as of December 31, 2020 | 269 | 267 |
Additional paid-in capital | 276,398 | 270,598 |
Retained earnings | 1,033,935 | 934,277 |
Treasury stock, at cost, 1,974,214 shares and 1,757,993 shares, respectively | (91,964) | (66,137) |
Total equity | 1,218,638 | 1,139,005 |
Total liabilities and equity | $ 1,825,486 | $ 1,826,087 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 250,000,000 | 250,000,000 |
Common Stock, Shares, Issued | 26,908,643 | 26,741,554 |
Common Stock, Shares, Outstanding | 24,934,429 | 24,983,561 |
Treasury Stock, Shares | 1,974,214 | 1,757,993 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Home sales revenues | $ 705,953 | $ 454,727 |
Cost of sales | 516,004 | 348,163 |
Selling expenses | 42,783 | 32,763 |
General and administrative | 24,723 | 19,923 |
Operating income | 122,443 | 53,878 |
Other income, net | (833) | (1,011) |
Net income before income taxes | 123,276 | 54,889 |
Income tax provision | 23,618 | 12,050 |
Net income | $ 99,658 | $ 42,839 |
Earnings per share: | ||
Basic (in dollars per share) | $ 3.99 | $ 1.69 |
Diluted (in dollars per share) | $ 3.95 | $ 1.67 |
Weighted average shares outstanding: | ||
Basic (in shares) | 24,950,867 | 25,323,119 |
Diluted (in shares) | 25,220,872 | 25,592,835 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock |
Beginning Balance (in shares) at Dec. 31, 2019 | 26,398,409 | ||||
Beginning Balance at Dec. 31, 2019 | $ 845,193 | $ 264 | $ 252,603 | $ 610,382 | $ (18,056) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 42,839 | 42,839 | |||
Restricted stock units granted for accrued annual bonuses | 222 | 222 | |||
Stock Repurchased During Period, Value | (31,335) | (31,335) | |||
Compensation expense for equity awards | 1,853 | 1,853 | |||
Stock issued under employee incentive plans (in shares) | 282,065 | ||||
Stock issued under employee incentive plans | 833 | $ 2 | 831 | ||
Ending Balance (in shares) at Mar. 31, 2020 | 26,680,474 | ||||
Ending Balance at Mar. 31, 2020 | 859,605 | $ 266 | 255,509 | 653,221 | (49,391) |
Beginning Balance (in shares) at Dec. 31, 2020 | 26,741,554 | ||||
Beginning Balance at Dec. 31, 2020 | 1,139,005 | $ 267 | 270,598 | 934,277 | (66,137) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 99,658 | 99,658 | |||
Restricted stock units granted for accrued annual bonuses | 272 | 272 | |||
Stock Repurchased During Period, Value | (25,827) | (25,827) | |||
Compensation expense for equity awards | 3,422 | 3,422 | |||
Stock issued under employee incentive plans (in shares) | 167,089 | ||||
Stock issued under employee incentive plans | 2,108 | $ 2 | 2,106 | ||
Ending Balance (in shares) at Mar. 31, 2021 | 26,908,643 | ||||
Ending Balance at Mar. 31, 2021 | $ 1,218,638 | $ 269 | $ 276,398 | $ 1,033,935 | $ (91,964) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 99,658 | $ 42,839 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 288 | 161 |
Compensation expense for equity awards | 3,422 | 1,853 |
Deferred income taxes | 3,636 | 2,320 |
Changes in assets and liabilities: | ||
Accounts receivable | 56,710 | 11,385 |
Real estate inventory | (41,692) | 17,902 |
Pre-acquisition costs and deposits | (2,276) | (204) |
Other assets | (4,192) | (2,953) |
Accounts payable | 27,876 | 6,571 |
Accrued expenses and other liabilities | 17,256 | (21,071) |
Net cash provided by operating activities | 160,686 | 58,803 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (1,279) | (417) |
Return of capital from unconsolidated entity | 1,683 | |
Investment in unconsolidated entity | (1,125) | |
Net cash provided by (used in) investing activities | 404 | (1,542) |
Cash flows from financing activities: | ||
Proceeds from notes payable | 104,844 | 128,128 |
Payments on notes payable | (230,000) | (75,000) |
Proceeds from sale of stock, net of offering expenses | 2,108 | 833 |
Stock repurchase | (25,827) | (31,335) |
Net cash provided by (used in) financing activities | (148,875) | 22,626 |
Net increase in cash and cash equivalents | 12,215 | 79,887 |
Cash and cash equivalents, beginning of period | 35,942 | 38,345 |
Cash and cash equivalents, end of period | $ 48,157 | $ 118,232 |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation Disclosures | ORGANIZATION AND BASIS OF PRESENTATION Organization and Description of the Business LGI Homes, Inc., a Delaware corporation (the “Company”, “we,” “us,” or “our”), is engaged in the development of communities and the design, construction and sale of new homes in Texas, Arizona, Florida, Georgia, New Mexico, Colorado, North Carolina, South Carolina, Washington, Tennessee, Minnesota, Oklahoma, Alabama, California, Oregon, Nevada, West Virginia, Virginia and Pennsylvania. Basis of Presentation The unaudited consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements should be read in conjunction with the consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. The accompanying unaudited consolidated financial statements include all adjustments that are of a normal recurring nature and necessary for the fair presentation of our results for the interim periods presented. Results for interim periods are not necessarily indicative of results to be expected for the full year. The accompanying unaudited financial statements as of March 31, 2021, and for the three months ended March 31, 2021 and 2020, include the accounts of the Company and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates, and these differences could have a significant impact on the financial statements. |
Revenues
Revenues | 3 Months Ended |
Mar. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues Disclosure | REVENUES Revenue Recognition Revenues from home sales are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues from home sales are recorded at the time each home sale is closed, title and possession are transferred to the customer and we have no significant continuing involvement with the home. Home sales discounts and incentives granted to customers, which are related to the customers’ closing costs that we pay on the customers’ behalf , are recorded as a reduction of revenue in our consolidated financial statements of operations. The following table presents our home sales revenues disaggregated by revenue stream (in thousands): Three Months Ended March 31, 2021 2020 Retail home sales revenues $ 643,572 $ 410,402 Wholesale home sales revenues 62,381 44,325 Total home sales revenues $ 705,953 $ 454,727 The following table presents our home sales revenues disaggregated by geography, based on our determined reportable segments in Note 13 (in thousands): Three Months Ended March 31, 2021 2020 Central $ 288,750 $ 165,775 Southeast 136,551 88,447 Northwest 118,191 101,948 West 81,148 58,485 Florida 81,313 40,072 Total home sales revenues $ 705,953 $ 454,727 Home Sales Revenues We generate revenues primarily by delivering move-in ready entry-level and move-up spec homes sold under our LGI Homes brand and our luxury series spec homes sold under our Terrata Homes brand. Retail homes sold under both our LGI Homes brand and Terrata Homes brand focus on providing move-in ready homes with standardized features within favorable markets that meet certain demographic and economic conditions. Our LGI Homes brand primarily markets to entry-level or first-time homebuyers, while our Terrata Homes brand primarily markets to move-up homebuyers. Wholesale homes are primarily sold under a bulk sales agreement and focus on providing move-in ready homes with standardized features to real estate investors that will ultimately use the single-family homes as rental properties. Performance Obligations Our contracts with customers include a single performance obligation to transfer a completed home to the customer. We generally determine selling price per home on the expected cost plus margin. Our contracts contain no significant financing terms as customers who finance do so through a third party. Performance obligations are satisfied at a moment in time when the home is complete and control of the asset is transferred to the customer at closing. Home sales proceeds are generally received from the title company within a few business days after closing. Sales and broker commissions are incremental costs incurred to obtain a contract with a customer that would not have been incurred if the contract had not been obtained. Sales and broker commissions are expensed upon fulfillment of a home closing. Advertising costs are costs to obtain a contract that would have been incurred regardless of whether the contract was obtained and are recognized as an expense when incurred. Sales and broker commissions and advertising costs are recorded within sales and marketing expense presented in our consolidated statements of operations as selling expenses. |
Real Estate Inventory
Real Estate Inventory | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Real Estate Inventory Disclosures | REAL ESTATE INVENTORY Our real estate inventory consists of the following (in thousands): March 31, December 31, 2021 2020 Land, land under development and finished lots $ 1,031,117 $ 981,838 Information centers 28,528 30,201 Homes in progress 425,585 337,364 Completed homes 124,463 220,086 Total real estate inventory $ 1,609,693 $ 1,569,489 Inventory is stated at cost unless the carrying amount is determined not to be recoverable, in which case the affected inventory is written down to fair value. Land, development and other project costs, including interest and property taxes incurred during development and home construction, net of expected reimbursable development costs, are capitalized to real estate inventory. Land development and other common costs that benefit the entire community, including field construction supervision and related direct overhead, are allocated to individual lots or homes, as appropriate. The costs of lots are transferred to homes in progress when home construction begins. Home construction costs and related carrying charges are allocated to the cost of individual homes using the specific identification method. Costs that are not specifically identifiable to a home are allocated on a pro rata basis, which we believe approximates the costs that would be determined using an allocation method based on relative sales values since the individual lots or homes within a community are similar in value. Inventory costs for completed homes are expensed to cost of sales as homes are closed. Changes to estimated total development costs subsequent to initial home closings in a community are generally allocated to the remaining unsold lots and homes in the community on a pro rata basis. The life cycle of a community generally ranges from two Interest and financing costs incurred under our debt obligations, as more fully discussed in Note 5 , are capitalized to qualifying real estate projects under development and homes under construction. |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Liabilities Disclosures | ACCRUED EXPENSES AND OTHER LIABILITIES Accrued and other liabilities consist of the following (in thousands): March 31, December 31, 2021 2020 Taxes payable $ 45,604 $ 26,181 Real estate inventory development and construction payable 31,138 29,938 Accrued compensation, bonuses and benefits 18,680 28,579 Accrued interest 5,262 10,853 Inventory related obligations 3,872 4,515 Lease liability 5,249 5,287 Warranty reserve 5,950 5,350 Contract deposits 27,195 17,151 Other 8,398 7,154 Total accrued expenses and other liabilities $ 151,348 $ 135,008 Inventory Related Obligations We own lots in certain communities in Arizona, Florida and Texas that have Community Development Districts or similar utility and infrastructure development special assessment programs that allocate a fixed amount of debt service associated with development activities to each lot. This obligation for infrastructure development is attached to the land, which is typically payable over a 30-year period and is ultimately assumed by the homebuyer when home sales are closed. Such obligations represent a non-cash cost of the lots. Estimated Warranty Reserve We typically provide homebuyers with a one-year warranty on the house and a ten-year limited warranty for major defects in structural elements such as framing components and foundation systems. Changes to our warranty accrual are as follows (in thousands): Three Months Ended March 31, 2021 2020 Warranty reserves, beginning of period $ 5,350 $ 3,500 Warranty provision 2,589 1,420 Warranty expenditures (1,989) (1,170) Warranty reserves, end of period $ 5,950 $ 3,750 |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Notes Payable Disclosures | NOTES PAYABLE Revolving Credit Agreement On April 30, 2020, we entered into the Second Amendment to Fourth Amended and Restated Credit Agreement (the “Second Amendment”), which amends the Fourth Amended and Restated Credit Agreement, dated as of May 6, 2019 (as amended by the Lender Addition and Acknowledgement Agreement and First Amendment to Fourth Amended and Restated Credit Agreement, dated as of December 6, 2019, the “2019 Credit Agreement” and, together with the Second Amendment, the “2020 Credit Agreement”), with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent. In the Second Amendment, certain lenders agreed to extend the maturity of their commitments, while another lender agreed to extend the maturity of its commitment subsequent to the execution of the Second Amendment. Lenders with $566.0 million, or 87%, of the $650.0 million of commitments under the 2019 Credit Agreement agreed to extend the maturity of their commitments to May 31, 2023, with the remaining lenders retaining their existing maturity of May 31, 2022. The Second Amendment also reduced the minimum EBITDA to interest expense ratio from 2.50 to 1.75, increased the sublimit for letters of credit to $40.0 million and established a London Interbank Offered Rate (“LIBOR”) floor of 0.70%. The 2020 Credit Agreement otherwise has substantially similar terms and provisions to the 2019 Credit Agreement and continues to provide for a $650.0 million revolving credit facility, which can be increased at the request of the Company by up to $100.0 million, subject to the terms and conditions of the 2020 Credit Agreement. The 2020 Credit Agreement matures on May 31, 2023 with respect to 87% of the commitments thereunder and on May 31, 2022 with respect to 13% of the commitments thereunder. Before each anniversary of the 2020 Credit Agreement, we may request a one-year extension of its maturity date. The 2020 Credit Agreement is guaranteed by each of our subsidiaries that have gross assets equal to or greater than $0.5 million. The borrowings and letters of credit outstanding under the 2020 Credit Agreement, together with the outstanding principal balance of our 6.875% Senior Notes due 2026 (the “Senior Notes”), may not exceed the borrowing base under the 2020 Credit Agreement. As of March 31, 2021, the borrowing base under the 2020 Credit Agreement was $949.3 million, of which borrowings, including the Senior Notes, of $421.5 million were outstanding, $10.3 million of letters of credit were outstanding and $517.5 million was available to borrow under the 2020 Credit Agreement. Interest is paid monthly on borrowings under the 2020 Credit Agreement at LIBOR plus 2.35%. The 2020 Credit Agreement applicable margin for LIBOR loans ranges from 2.35% to 2.75% based on our leverage ratio. At March 31, 2021, LIBOR was 0.11%; however, the 2020 Credit Agreement has a 0.70% LIBOR floor. The 2020 Credit Agreement contains various financial covenants, including a minimum tangible net worth, a leverage ratio, a minimum liquidity amount and an EBITDA to interest expense ratio. The 2020 Credit Agreement contains various covenants that, among other restrictions, limit the amount of our additional debt and our ability to make certain investments. At March 31, 2021, we were in compliance with all of the covenants contained in the 2020 Credit Agreement. On April 28, 2021, we entered into that certain Fifth Amended and Restated Credit Agreement with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent (the “Credit Agreement”), which amends and restates the 2020 Credit Agreement. The Credit Agreement (a) increases the commitments to $850.0 million, (b) allows the Company to increase the commitments by up to $100.0 million, subject to terms and conditions, (c) extends the maturity to April 28, 2025 for all lenders, (d) increases the sublimit for letters of credit to $50.0 million, (e) adds unrestricted cash in excess of $10.0 million as a component of the borrowing base and removes certain exclusions from the borrowing base, (f) reduces the applicable margin for LIBOR loans to a range of 2.10% to 1.45%, based on our leverage ratio, (g) reduces the LIBOR floor to 0.50%, (h) increases the minimum tangible net worth requirement to $850.0 million plus 75% of the net proceeds of equity issuances after December 31, 2020 and 50% of consolidated earnings for each quarter ending after March 31, 2021 and (i) provides for a “hardwired” transition from LIBOR loan pricing that is intended to be economically neutral to the Company; otherwise, the Credit Agreement is on substantially the same terms as the 2020 Credit Agreement. Senior Notes Offering On July 6, 2018, we issued $300.0 million aggregate principal amount of the Senior Notes in an offering to persons reasonably believed to be qualified institutional buyers in the United States pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to certain non-U.S. persons in transactions outside the United States pursuant to Regulation S under the Securities Act. Interest on the Senior Notes accrues at a rate of 6.875% per annum, payable semi-annually in arrears on January 15 and July 15 of each year, commencing on January 15, 2019, and the Senior Notes mature on July 15, 2026. Terms of the Senior Notes are governed by an Indenture and First Supplemental Indenture thereto, each dated as of July 6, 2018, and a Second Supplemental Indenture thereto, dated as of April 30, 2020, as may be supplemented from time to time, among us, our subsidiaries that guarantee our obligations under the 2020 Credit Agreement and Wilmington Trust, National Association, as trustee. Notes payable consist of the following (in thousands): March 31, 2021 December 31, 2020 Notes payable under the 2020 Credit Agreement ($650.0 million revolving credit facility at March 31, 2021) maturing in part on May 31, 2022 and in part on May 31, 2023; interest paid monthly at LIBOR plus 2.35%; net of debt issuance costs of approximately $4.4 million and $4.9 million at March 31, 2021 and December 31, 2020, respectively $ 117,107 $ 241,717 6.875% Senior Notes due July 15, 2026; interest paid semi-annually at 6.875%; net of debt issuance costs of approximately $1.8 million and $1.9 million at March 31, 2021 and December 31, 2020, respectively; and approximately $1.4 million in unamortized discount at March 31, 2021 and December 31, 2020. 296,841 296,681 Total notes payable $ 413,948 $ 538,398 Capitalized Interest Interest activity, including other financing costs, for notes payable for the periods presented is as follows (in thousands): Three Months Ended March 31, 2021 2020 Interest incurred $ 7,732 $ 10,156 Less: Amounts capitalized (7,732) (10,156) Interest expense $ — $ — Cash paid for interest $ 12,633 $ 15,024 Included in interest incurred was amortization of deferred financing costs and discounts for notes payable of $0.7 million for the three months ended March 31, 2021 and 2020. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosures | INCOME TAXES We file U.S. and state income tax returns in jurisdictions with varying statutes of limitations. The statute of limitations with regards to our federal income tax filings is three years. The statute of limitations for our state tax jurisdictions is three to four years depending on the jurisdiction. In the normal course of business, we are subject to tax audits in various jurisdictions, and such jurisdictions may assess additional income taxes. We do not expect the outcome of any audit to have a material effect on our consolidated financial statements; however, audit outcomes and the timing of audit adjustments are subject to significant uncertainty. For the three months ended March 31, 2021, our effective tax rate of 19.2% is lower than the Federal statutory rate primarily as a result of the extension of the federal energy efficient homes tax credit that was enacted into law in December 2019 and excess compensation cost for share-based payments, partially offset by an increase in the rate for state income taxes, net of the federal benefit payments. |
Equity
Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Equity Disclosures | EQUITY Stock Repurchase Program In November 2018, we announced that our Board of Directors (the “Board”) authorized a stock repurchase program, pursuant to which we may purchase up to $50.0 million of shares of our common stock through open market transactions, privately negotiated transactions or otherwise in accordance with applicable laws. In October 2020, the Board approved an increase in our stock repurchase program by an additional $300.0 million. During the three months ended March 31, 2021 and 2020, we repurchased 216,221 and 567,028 shares of our common stock for $25.8 million and $31.3 million, respectively, to be held as treasury stock. A total of 757,993 shares of our common stock has been repurchased since our stock repurchase program commenced. As of March 31, 2021, we may purchase up to $274.6 million of shares of our common stock under our stock repurchase program. The timing, amount and other terms and conditions of any repurchases of shares of our common stock under our stock repurchase program will be determined by our management at its discretion based on a variety of factors, including the market price of our common stock, corporate considerations, general market and economic conditions and legal requirements. Our stock repurchase program may be modified, discontinued or suspended at any time. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share Disclosures | EARNINGS PER SHARE The following table sets forth the computation of basic and diluted earnings per share for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 2020 Numerator (in thousands): Net income (Numerator for basic and dilutive earnings per share) $ 99,658 $ 42,839 Denominator: Basic weighted average shares outstanding 24,950,867 25,323,119 Effect of dilutive securities: Stock-based compensation units 270,005 269,716 Diluted weighted average shares outstanding 25,220,872 25,592,835 Basic earnings per share $ 3.99 $ 1.69 Diluted earnings per share $ 3.95 $ 1.67 Antidilutive non-vested restricted stock units excluded from calculation of diluted earnings per share 21,510 26,893 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation Disclosures | STOCK-BASED COMPENSATION Non-performance Based Restricted Stock Units The following table summarizes the activity of our time-vested restricted stock units (“RSUs”): Three Months Ended March 31, 2021 2020 Shares Weighted Average Grant Date Fair Value Shares Weighted Average Grant Date Fair Value Beginning balance 142,738 $ 62.54 162,686 $ 50.84 Granted 23,366 $ 141.00 46,701 $ 59.81 Vested (30,407) $ 64.44 (51,531) $ 31.95 Forfeited (1,627) $ 61.58 (982) $ 51.03 Ending balance 134,070 $ 75.79 156,874 $ 59.71 We recognized $0.8 million of stock-based compensation expense related to outstanding RSUs for the three months ended March 31, 2021 and 2020. Generally, the RSUs cliff vest on the third anniversary of the grant date and can only be settled in shares of our common stock. At March 31, 2021, we had unrecognized compensation cost of $6.2 million related to unvested RSUs, which is expected to be recognized over a weighted average period of 2.2 years. Performance-Based Restricted Stock Units The Compensation Committee of the Board has granted awards of performance-based RSUs (“PSUs”) under the Amended and Restated LGI Homes, Inc. 2013 Equity Incentive Plan to certain members of senior management based on three-year performance cycles. The PSUs provide for shares of our common stock to be issued based on the attainment of certain performance metrics over the applicable three-year periods. The number of shares of our common stock that may be issued to the recipients for the PSUs range from 0% to 200% of the target amount depending on actual results as compared to the target performance metrics. The terms of the PSUs provide that the payouts will be capped at 100% of the target number of PSUs granted if absolute total stockholder return is negative during the performance period, regardless of EPS performance; this market condition applies for amounts recorded above target. The compensation expense associated with the PSU grants is determined using the derived grant date fair value, based on a third-party valuation analysis, and expensed over the applicable period. The PSUs vest upon the determination date for the actual results at the end of the three-year period and require that the recipients continue to be employed by us through the determination date. The PSUs can only be settled in shares of our common stock. The following table summarizes the activity of our PSUs for the three months ended March 31, 2021: Period Granted Performance Period Target PSUs Outstanding at December 31, 2020 Target PSUs Granted Target PSUs Vested Target PSUs Forfeited Target PSUs Outstanding at March 31, 2020 Weighted Average Grant Date Fair Value 2018 2018 - 2020 60,040 — (60,040) — — $ 64.60 2019 2019 - 2021 81,242 — — — 81,242 $ 56.49 2020 2020 - 2022 88,538 — — — 88,538 $ 59.81 2021 2021 - 2023 — 46,027 — — 46,027 $ 141.00 Total 229,820 46,027 (60,040) — 215,807 At March 31, 2021, management estimates that the recipients will receive approximately 100%, 200% and 200% of the 2021, 2020 and 2019 target number of PSUs, respectively, at the end of the applicable three-year performance cycle based on projected performance compared to the target performance metrics. We recognized $2.2 million and $0.9 million of total stock-based compensation expense related to outstanding PSUs for the three months ended March 31, 2021 and 2020, respectively. The 2018 - 2020 performance period PSUs vested and issued on March 15, 2021 at 200% of the target number. At March 31, 2021, we had unrecognized compensation cost of $16.6 million, based on the probable amount, related to unvested PSUs, which is expected to be recognized over a weighted average period of 2.1 years. |
Fair Value Disclosures
Fair Value Disclosures | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | FAIR VALUE DISCLOSURES ASC Topic 820, Fair Value Measurements (“ASC 820”) , defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date” within an entity’s principal market, if any. The principal market is the market in which the reporting entity would sell the asset or transfer the liability with the greatest volume and level of activity, regardless of whether it is the market in which the entity will ultimately transact for a particular asset or liability or if a different market is potentially more advantageous. Accordingly, this exit price concept may result in a fair value that differs from the transaction price or market price of the asset or liability. ASC 820 provides a framework for measuring fair value under GAAP, expands disclosures about fair value measurements and establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the fair value hierarchy are summarized as follows: Level 1 - Fair value is based on quoted prices in active markets for identical assets or liabilities. Level 2 - Fair value is determined using significant observable inputs, generally either quoted prices in active markets for similar assets or liabilities, or quoted prices in markets that are not active. Level 3 - Fair value is determined using one or more significant inputs that are unobservable in active markets at the measurement date, such as a pricing model, discounted cash flow or similar technique. We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements may also be utilized on a nonrecurring basis, such as for the impairment of long-lived assets. The fair value of financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and certain accrued liabilities approximate their carrying amounts due to the short-term nature of these instruments. As of March 31, 2021, the Credit Agreement’s carrying value approximates market value since it has a floating interest rate, which increases or decreases with market interest rates and our leverage ratio. In order to determine the fair value of the Senior Notes, the future contractual cash flows are discounted at our estimate of current market rates of interest, which were determined based upon the average interest rates of similar senior notes within the homebuilding industry (Level 2 measurement). The following table below shows the level and measurement of liabilities at March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 December 31, 2020 Fair Value Hierarchy Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Senior Notes Level 2 $ 296,841 $ 338,080 $ 296,681 $ 340,388 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosures | RELATED PARTY TRANSACTIONS Land Purchases from Affiliates As of March 31, 2021, we have a land purchase contract to purchase a total of 110 finished lots in Pasco County, Florida from an affiliate of one of our directors for a total base purchase price of approximately $4.0 million. The lots will be purchased in takedowns, subject to a maximum price escalation of 6% per annum, and may provide for additional payments to the seller at the time of sale to the homebuyer. We have a $0.2 million non-refundable deposit at March 31, 2021 related to this land purchase contract. In August 2019, we purchased our first takedown of 58 lots under the Pasco County contract for a base purchase price of approximately $2.1 million. We did not complete any takedowns under this land purchase contract during the three months ended March 31, 2021 and 2020. As of March 31, 2021, we have a land purchase contract to purchase a total of 25 finished lots in Burnet County, Texas from an affiliate of a family member of our chief executive officer for a total base purchase price of approximately $2.5 million. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosures | COMMITMENTS AND CONTINGENCIES Contingencies In the ordinary course of doing business, we are subject to claims or proceedings from time to time relating to the purchase, development and sale of real estate and homes and other aspects of our homebuilding operations. Management believes that these claims include usual obligations incurred by real estate developers and residential home builders in the normal course of business. In the opinion of management, these matters will not have a material effect on our consolidated financial position, results of operations or cash flows. We have provided unsecured environmental indemnities to certain lenders and other counterparties. In each case, we have performed due diligence on the potential environmental risks including obtaining an independent environmental review from outside environmental consultants. These indemnities obligate us to reimburse the guaranteed parties for damages related to environmental matters. There is no term or damage limitation on these indemnities; however, if an environmental matter arises, we may have recourse against other previous owners. In the ordinary course of doing business, we are subject to regulatory proceedings from time to time related to environmental and other matters. In the opinion of management, these matters will not have a material effect on our consolidated financial position, results of operations or cash flows. Land Deposits We have land purchase contracts, generally through cash deposits, for the right to purchase land or lots at a future point in time with predetermined terms. We do not have title to the property, and obligations with respect to the land purchase contracts are generally limited to the forfeiture of the related nonrefundable cash deposits. The following is a summary of our land purchase deposits included in pre-acquisition costs and deposits (in thousands, except for lot count): March 31, 2021 December 31, 2020 Land deposits and option payments $ 35,484 $ 34,097 Commitments under the land purchase contracts if the purchases are consummated $ 728,140 $ 663,006 Lots under land purchase contracts 28,784 26,236 As of March 31, 2021 and December 31, 2020, approximately $25.1 million and $24.0 million, respectively, of the land deposits are related to purchase contracts to deliver finished lots that are refundable under certain circumstances, such as feasibility or specific performance, and secured by mortgages or letters of credit or guaranteed by the seller or its affiliates. Lease Obligations We recognize lease obligations and associated right-of-use (“ROU”) assets for our existing non-cancelable leases. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. We have non-cancelable operating leases primarily associated with our corporate and regional office facilities. Operating lease expense is recognized on a straight-line basis over the lease term, subject to any changes in the lease or expectations regarding the terms. Variable lease costs such as common area costs and property taxes are expensed as incurred. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The lease term may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. ROU assets, as included in other assets on the consolidated balance sheets, were $4.9 million as of March 31, 2021 and December 31, 2020. Lease obligations, as included in accrued expenses and other liabilities on the consolidated balance sheets, were $5.2 million and $5.3 million at March 31, 2021 and December 31, 2020, respectively. Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $0.4 million for the three months ended March 31, 2021 and 2020. Cash paid for amounts included in the measurement of lease liabilities for operating leases during the three months ended March 31, 2021 and 2020 was $0.2 million and $0.4 million, respectively. As of March 31, 2021, the weighted-average discount rate was 5.24% and our weighted-average remaining life was 4.8 years. We do not have any significant lease contracts that have not yet commenced at March 31, 2021. The table below shows the future minimum payments under non-cancelable operating leases at March 31, 2021 (in thousands): Year Ending December 31, Operating leases 2021 $ 997 2022 1,138 2023 1,007 2024 776 2025 517 Thereafter 1,762 Total 6,197 Lease amount representing interest (948) Present value of lease liabilities $ 5,249 Bonding and Letters of Credit We have outstanding letters of credit and performance and surety bonds totaling $167.6 million (including $10.3 million of letters of credit issued under the Credit Agreement) and $143.8 million at March 31, 2021 and December 31, 2020, respectively, related to our obligations for site improvements at various projects. Management does not believe that draws upon the letters of credit, surety bonds or financial guarantees if any, will have a material effect on our consolidated financial position, results of operations or cash flows. Investment in Unconsolidated Entity In 2019, we became a limited partner in a real estate investment fund with a maximum $30.0 million commitment. The term of the commitment is eight years and includes renewals of up to two |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information Disclosures | SEGMENT INFORMATIONWe operate one principal homebuilding business that is organized and reports by division. We have seven operating segments (our Central, Midwest, Southeast, Mid-Atlantic, Northwest, West, and Florida divisions) that we aggregate into five reportable segments at March 31, 2021: our Central, Southeast, Northwest, West, and Florida divisions. These segments reflect the way the Company evaluates its business performance and manages its operations. The Central division is our largest division and comprised approximately 40.9% and 36.5% of total home sales revenues for the three months ended March 31, 2021 and 2020, respectively. In accordance with ASC Topic 280, Segment Reporting , operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the chief operating decision-makers (“CODMs”) in deciding how to allocate resources and in assessing performance. The CODMs primarily evaluate performance based on the number of homes closed, gross margin and average sales price per home closed. The seven operating segments qualify as our five reportable segments. In determining the most appropriate reportable segments, we consider operating segments’ economic and other characteristics, including home floor plans, average selling prices, gross margin percentage, geographical proximity, production construction processes, suppliers, subcontractors, regulatory environments, customer type and underlying demand and supply. Each operating segment follows the same accounting policies and is managed by our management team. We have no inter-segment sales, as all sales are to external customers. Operating results for each segment may not be indicative of the results for such segment had it been an independent, stand-alone entity for the periods presented. Financial information relating to our reportable segments was as follows (in thousands): Three Months Ended March 31, 2021 2020 Revenues: Central $ 288,750 $ 165,775 Southeast 136,551 88,447 Northwest 118,191 101,948 West 81,148 58,485 Florida 81,313 40,072 Total home sales revenues $ 705,953 $ 454,727 Net income (loss) before income taxes: Central $ 55,634 $ 24,234 Southeast 19,831 7,908 Northwest 25,994 16,527 West 12,611 5,272 Florida 10,816 2,525 Corporate (1) (1,610) (1,577) Total net income before income taxes $ 123,276 $ 54,889 (1) The Corporate balance consists primarily of general and administration unallocated costs for various shared service functions, as well as our warranty reserve. Actual warranty expenses are reflected within the reportable segments. March 31, 2021 December 31, 2020 Assets: Central $ 679,525 $ 708,087 Southeast 381,246 401,725 Northwest 251,325 252,098 West 264,832 228,186 Florida 157,561 157,169 Corporate (1) 90,997 78,822 Total assets $ 1,825,486 $ 1,826,087 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENT On April 28, 2021, we entered into that certain Fifth Amended and Restated Credit Agreement with several financial institutions, and Wells Fargo Bank, National Association, as administrative agent, which amends and restates the 2020 Credit Agreement, as more fully discussed in Note 5 . |
Revenues (Tables)
Revenues (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |
Revenue from External Customers by Products | The following table presents our home sales revenues disaggregated by revenue stream (in thousands): Three Months Ended March 31, 2021 2020 Retail home sales revenues $ 643,572 $ 410,402 Wholesale home sales revenues 62,381 44,325 Total home sales revenues $ 705,953 $ 454,727 |
Revenue from External Customers by Geographic Areas | The following table presents our home sales revenues disaggregated by geography, based on our determined reportable segments in Note 13 (in thousands): Three Months Ended March 31, 2021 2020 Central $ 288,750 $ 165,775 Southeast 136,551 88,447 Northwest 118,191 101,948 West 81,148 58,485 Florida 81,313 40,072 Total home sales revenues $ 705,953 $ 454,727 |
Real Estate Inventory (Tables)
Real Estate Inventory (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Real Estate Inventory | Our real estate inventory consists of the following (in thousands): March 31, December 31, 2021 2020 Land, land under development and finished lots $ 1,031,117 $ 981,838 Information centers 28,528 30,201 Homes in progress 425,585 337,364 Completed homes 124,463 220,086 Total real estate inventory $ 1,609,693 $ 1,569,489 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Accrued and Other Current Liabilities | Accrued and other liabilities consist of the following (in thousands): March 31, December 31, 2021 2020 Taxes payable $ 45,604 $ 26,181 Real estate inventory development and construction payable 31,138 29,938 Accrued compensation, bonuses and benefits 18,680 28,579 Accrued interest 5,262 10,853 Inventory related obligations 3,872 4,515 Lease liability 5,249 5,287 Warranty reserve 5,950 5,350 Contract deposits 27,195 17,151 Other 8,398 7,154 Total accrued expenses and other liabilities $ 151,348 $ 135,008 |
Changes in Company's Warranty Accrual | Changes to our warranty accrual are as follows (in thousands): Three Months Ended March 31, 2021 2020 Warranty reserves, beginning of period $ 5,350 $ 3,500 Warranty provision 2,589 1,420 Warranty expenditures (1,989) (1,170) Warranty reserves, end of period $ 5,950 $ 3,750 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable consist of the following (in thousands): March 31, 2021 December 31, 2020 Notes payable under the 2020 Credit Agreement ($650.0 million revolving credit facility at March 31, 2021) maturing in part on May 31, 2022 and in part on May 31, 2023; interest paid monthly at LIBOR plus 2.35%; net of debt issuance costs of approximately $4.4 million and $4.9 million at March 31, 2021 and December 31, 2020, respectively $ 117,107 $ 241,717 6.875% Senior Notes due July 15, 2026; interest paid semi-annually at 6.875%; net of debt issuance costs of approximately $1.8 million and $1.9 million at March 31, 2021 and December 31, 2020, respectively; and approximately $1.4 million in unamortized discount at March 31, 2021 and December 31, 2020. 296,841 296,681 Total notes payable $ 413,948 $ 538,398 |
Schedule of Interest Activity for Notes Payable | Interest activity, including other financing costs, for notes payable for the periods presented is as follows (in thousands): Three Months Ended March 31, 2021 2020 Interest incurred $ 7,732 $ 10,156 Less: Amounts capitalized (7,732) (10,156) Interest expense $ — $ — Cash paid for interest $ 12,633 $ 15,024 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted earnings per share for the three months ended March 31, 2021 and 2020: Three Months Ended March 31, 2021 2020 Numerator (in thousands): Net income (Numerator for basic and dilutive earnings per share) $ 99,658 $ 42,839 Denominator: Basic weighted average shares outstanding 24,950,867 25,323,119 Effect of dilutive securities: Stock-based compensation units 270,005 269,716 Diluted weighted average shares outstanding 25,220,872 25,592,835 Basic earnings per share $ 3.99 $ 1.69 Diluted earnings per share $ 3.95 $ 1.67 Antidilutive non-vested restricted stock units excluded from calculation of diluted earnings per share 21,510 26,893 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Restricted Stock Unit Activity | The following table summarizes the activity of our time-vested restricted stock units (“RSUs”): Three Months Ended March 31, 2021 2020 Shares Weighted Average Grant Date Fair Value Shares Weighted Average Grant Date Fair Value Beginning balance 142,738 $ 62.54 162,686 $ 50.84 Granted 23,366 $ 141.00 46,701 $ 59.81 Vested (30,407) $ 64.44 (51,531) $ 31.95 Forfeited (1,627) $ 61.58 (982) $ 51.03 Ending balance 134,070 $ 75.79 156,874 $ 59.71 |
Schedule of Performance Based Stock Activity | The following table summarizes the activity of our PSUs for the three months ended March 31, 2021: Period Granted Performance Period Target PSUs Outstanding at December 31, 2020 Target PSUs Granted Target PSUs Vested Target PSUs Forfeited Target PSUs Outstanding at March 31, 2020 Weighted Average Grant Date Fair Value 2018 2018 - 2020 60,040 — (60,040) — — $ 64.60 2019 2019 - 2021 81,242 — — — 81,242 $ 56.49 2020 2020 - 2022 88,538 — — — 88,538 $ 59.81 2021 2021 - 2023 — 46,027 — — 46,027 $ 141.00 Total 229,820 46,027 (60,040) — 215,807 |
Fair Value Disclosures (Tables)
Fair Value Disclosures (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | The following table below shows the level and measurement of liabilities at March 31, 2021 and December 31, 2020 (in thousands): March 31, 2021 December 31, 2020 Fair Value Hierarchy Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Senior Notes Level 2 $ 296,841 $ 338,080 $ 296,681 $ 340,388 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Lessee, Operating Lease, Liability, Maturity | The table below shows the future minimum payments under non-cancelable operating leases at March 31, 2021 (in thousands): Year Ending December 31, Operating leases 2021 $ 997 2022 1,138 2023 1,007 2024 776 2025 517 Thereafter 1,762 Total 6,197 Lease amount representing interest (948) Present value of lease liabilities $ 5,249 |
Summary of Lots Under Option or Contract | The following is a summary of our land purchase deposits included in pre-acquisition costs and deposits (in thousands, except for lot count): March 31, 2021 December 31, 2020 Land deposits and option payments $ 35,484 $ 34,097 Commitments under the land purchase contracts if the purchases are consummated $ 728,140 $ 663,006 Lots under land purchase contracts 28,784 26,236 |
Segment (Tables)
Segment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting Information [Line Items] | |
Schedule of Segment Reporting Information, by Segment | Financial information relating to our reportable segments was as follows (in thousands): Three Months Ended March 31, 2021 2020 Revenues: Central $ 288,750 $ 165,775 Southeast 136,551 88,447 Northwest 118,191 101,948 West 81,148 58,485 Florida 81,313 40,072 Total home sales revenues $ 705,953 $ 454,727 Net income (loss) before income taxes: Central $ 55,634 $ 24,234 Southeast 19,831 7,908 Northwest 25,994 16,527 West 12,611 5,272 Florida 10,816 2,525 Corporate (1) (1,610) (1,577) Total net income before income taxes $ 123,276 $ 54,889 (1) The Corporate balance consists primarily of general and administration unallocated costs for various shared service functions, as well as our warranty reserve. Actual warranty expenses are reflected within the reportable segments. March 31, 2021 December 31, 2020 Assets: Central $ 679,525 $ 708,087 Southeast 381,246 401,725 Northwest 251,325 252,098 West 264,832 228,186 Florida 157,561 157,169 Corporate (1) 90,997 78,822 Total assets $ 1,825,486 $ 1,826,087 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | $ 705,953 | $ 454,727 |
Retail | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | 643,572 | 410,402 |
Wholesale | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | 62,381 | 44,325 |
Central | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | 288,750 | 165,775 |
Southeast | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | 136,551 | 88,447 |
Northwest | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | 118,191 | 101,948 |
West | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | 81,148 | 58,485 |
Florida | ||
Disaggregation of Revenue [Line Items] | ||
Home sales revenues | $ 81,313 | $ 40,072 |
Schedule of Real Estate Invento
Schedule of Real Estate Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory [Line Items] | ||
Land, land under development and finished lots | $ 1,031,117 | $ 981,838 |
Information centers | 28,528 | 30,201 |
Homes in progress | 425,585 | 337,364 |
Completed homes | 124,463 | 220,086 |
Total real estate inventory | $ 1,609,693 | $ 1,569,489 |
Minimum | ||
Inventory [Line Items] | ||
Community life cycle | 2 years | |
Maximum | ||
Inventory [Line Items] | ||
Community life cycle | 5 years |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||||
Taxes payable | $ 45,604 | $ 26,181 | ||
Real estate inventory development and construction payable | 31,138 | 29,938 | ||
Accrued compensation, bonuses and benefits | 18,680 | 28,579 | ||
Accrued interest | 5,262 | 10,853 | ||
Inventory related obligations | 3,872 | 4,515 | ||
Operating Lease, Liability | 5,249 | 5,287 | ||
Warranty reserve | 5,950 | 5,350 | $ 3,750 | $ 3,500 |
Contract deposits | 27,195 | 17,151 | ||
Other | 8,398 | 7,154 | ||
Total accrued expenses and other liabilities | $ 151,348 | $ 135,008 |
Accrued Expenses and Other Li_4
Accrued Expenses and Other Liabilities - Narrative (Details) | 3 Months Ended |
Mar. 31, 2021 | |
Product Warranty Liability [Line Items] | |
Inventory related obligation term | 30 years |
Other Construction Components | |
Product Warranty Liability [Line Items] | |
Limited warranty period | 1 year |
Structural Elements | |
Product Warranty Liability [Line Items] | |
Limited warranty period | 10 years |
Changes in Warranty Reserve (De
Changes in Warranty Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Product Warranty, Increase (Decrease) [Roll Forward] | ||
Warranty reserves, beginning of period | $ 5,350 | $ 3,500 |
Warranty provision | 2,589 | 1,420 |
Warranty expenditures | (1,989) | (1,170) |
Warranty reserves, end of period | $ 5,950 | $ 3,750 |
Other Construction Components | ||
Product Warranty Liability [Line Items] | ||
Limited warranty period | 1 year | |
Structural Elements | ||
Product Warranty Liability [Line Items] | ||
Limited warranty period | 10 years |
Revolving Credit Agreement (Det
Revolving Credit Agreement (Details) | Apr. 28, 2021USD ($) | Mar. 31, 2021USD ($) | Mar. 31, 2020 | Dec. 31, 2020USD ($) | Apr. 30, 2020USD ($) |
Line of Credit Facility [Line Items] | |||||
Assets | $ 1,825,486,000 | $ 1,826,087,000 | |||
Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility | 650,000,000 | ||||
Line of credit facility, current borrowing capacity | $ 949,300,000 | ||||
Line of credit facility, expiration date | May 31, 2023 | ||||
Line of credit, amount outstanding | $ 421,500,000 | ||||
Letters of credit outstanding | 10,300,000 | ||||
Line of credit facility, remaining borrowing capacity | $ 517,500,000 | ||||
Base spread on variable rate | 2.35% | ||||
Percent of total to expire in period one | 87.00% | ||||
Percent of total to expire in period two | 13.00% | ||||
Revolving Credit Facility | LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Variable interest rate | 0.11% | ||||
Revolving Credit Facility | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Base spread on variable rate | 2.35% | ||||
Revolving Credit Facility | Minimum | Guarantor Subsidiaries | |||||
Line of Credit Facility [Line Items] | |||||
Assets | $ 500,000 | ||||
Revolving Credit Facility | Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Base spread on variable rate | 2.75% | ||||
Second Amendment | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility | $ 650,000,000 | ||||
Line of credit facility, additional borrowing capacity | 100,000,000 | ||||
Interest expense ratio | 1.75 | 2.50 | |||
Letters of credit outstanding | 566,000,000 | ||||
Sublimit | $ 40,000,000 | ||||
Percent of total | 87.00% | ||||
Second Amendment | LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Variable interest rate | 0.70% | 0.70% | |||
Fifth Amended and Restated Credit Agreement | Subsequent Event | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility | $ 850,000,000 | ||||
Line of credit facility, additional borrowing capacity | 100,000,000 | ||||
Letters of credit, sublimit maximum | 50,000,000 | ||||
Letters of credit, borrowing base | 10,000,000 | ||||
Letters of credit, net worth requirement | $ 850,000,000 | ||||
Letters of credit, net worth requirement, percent of equity issuance | 75.00% | ||||
Letters of credit, net worth requirement, percent of consolidated earnings each quarter | 50.00% | ||||
Fifth Amended and Restated Credit Agreement | LIBOR | Subsequent Event | |||||
Line of Credit Facility [Line Items] | |||||
Variable interest rate | 0.50% | ||||
Fifth Amended and Restated Credit Agreement | Minimum | Subsequent Event | |||||
Line of Credit Facility [Line Items] | |||||
Base spread on variable rate | 2.10% | ||||
Fifth Amended and Restated Credit Agreement | Maximum | Subsequent Event | |||||
Line of Credit Facility [Line Items] | |||||
Base spread on variable rate | 1.45% |
Schedule of Notes Payable (Deta
Schedule of Notes Payable (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | ||
Notes payable | $ 413,948,000 | $ 538,398,000 |
LIBOR | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.35% | |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 117,107,000 | 241,717,000 |
Line of credit facility | 650,000,000 | |
Debt issuance costs | 4,400,000 | 4,900,000 |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Notes payable | 296,841,000 | 296,681,000 |
Debt issuance costs | 1,800,000 | 1,900,000 |
Unamortized discount | $ 1,400,000 | $ 1,400,000 |
Senior Notes (Details)
Senior Notes (Details) - Senior Notes $ in Millions | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Debt Instrument [Line Items] | |
Senior Notes, Gross | $ 300 |
Stated interest rate on note | 6.875% |
Senior Notes maturity date | Jul. 15, 2026 |
Capitalized Interest (Details)
Capitalized Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Debt Disclosure [Abstract] | ||
Interest incurred | $ 7,732 | $ 10,156 |
Less: Amounts capitalized | (7,732) | (10,156) |
Interest expense | 0 | 0 |
Cash paid for interest | 12,633 | $ 15,024 |
Amortization of Debt Issuance Costs and Discounts | $ 700 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate reconciliation, percent | 19.20% | |
Income taxes paid | $ 0.2 | $ 18.4 |
Equity (Details)
Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 29 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Mar. 31, 2021 | Dec. 31, 2020 | Oct. 30, 2020 | |
Equity [Abstract] | |||||
Treasury Stock, Shares | 1,974,214 | 1,974,214 | 1,757,993 | ||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 50,000,000 | 50,000,000 | 300,000,000 | ||
Treasury Stock, Shares, Acquired | 216,221 | 567,028 | 757,993 | ||
Treasury Stock, Value, Acquired, Cost Method | $ 25.8 | $ 31.3 | |||
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased | 274,600,000 | 274,600,000 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Earnings Per Share [Abstract] | ||
Net income | $ 99,658 | $ 42,839 |
Basic weighted average shares outstanding | 24,950,867 | 25,323,119 |
Stock-based compensation units | 270,005 | 269,716 |
Diluted weighted average shares outstanding | 25,220,872 | 25,592,835 |
Basic earnings per share (in dollars per share) | $ 3.99 | $ 1.69 |
Diluted earnings per share (in dollars per share) | $ 3.95 | $ 1.67 |
Antidilutive non-vested restricted stock units excluded from calculation of diluted earnings per share | 21,510 | 26,893 |
Summary of Non-Perfomance Based
Summary of Non-Perfomance Based Restricted Stock Units (Details) - Restricted stock units (RSUs) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Award [Abstract] | ||
Balance at Beginning of Period (in shares) | 142,738 | 162,686 |
Granted (in shares) | 23,366 | 46,701 |
Vested (in shares) | (30,407) | (51,531) |
Forfeited (in shares) | (1,627) | (982) |
Balance at End of Period (in shares) | 134,070 | 156,874 |
Share-based Compensation Arrangement by Award, Fair Value [Abstract] | ||
Shares outstanding at the beginning of the period, weighted average grant date fair value (in dollars per share) | $ 62.54 | $ 50.84 |
Granted, weighted average grant date fair value (in dollars per share) | 141 | 59.81 |
Vested, weighted average grant date fair value (in dollars per share) | 64.44 | 31.95 |
Forfeited, weighted average grant date fair value (in dollars per share) | 61.58 | 51.03 |
Shares outstanding at the end of the period, weighted average grant date fair value (in dollars per share) | $ 75.79 | $ 59.71 |
Share-based compensation expense | $ 0.8 | $ 0.8 |
Share-based compensation not yet recognized | $ 6.2 | |
Share-based compensation not yet recognized, period for recognition | 2 years 2 months 12 days |
Summary of Performance Based Re
Summary of Performance Based Restricted Stock Units (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 100.00% | |
Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Performance vesting period | 3 years | |
Balance at Beginning of Period (in shares) | 229,820 | |
Granted (in shares) | 46,027 | |
Vested (in shares) | (60,040) | |
Forfeited (in shares) | 0 | |
Balance at End of Period (in shares) | 215,807 | |
Share-based compensation expense | $ 2.2 | $ 0.9 |
Share-based compensation not yet recognized | $ 16.6 | |
Share-based compensation not yet recognized, period for recognition | 2 years 1 month 6 days | |
2018 Grant | Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 200.00% | |
Balance at Beginning of Period (in shares) | 60,040 | |
Vested (in shares) | (60,040) | |
Balance at End of Period (in shares) | 0 | |
Weighted average grant date fair value (in dollars per share) | $ 64.60 | |
2019 Grant | Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 200.00% | |
Balance at Beginning of Period (in shares) | 81,242 | |
Balance at End of Period (in shares) | 81,242 | |
Weighted average grant date fair value (in dollars per share) | $ 56.49 | |
2020 Grant | Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 200.00% | |
Balance at Beginning of Period (in shares) | 88,538 | |
Balance at End of Period (in shares) | 88,538 | |
Weighted average grant date fair value (in dollars per share) | $ 59.81 | |
2021 Grant | Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 100.00% | |
Granted (in shares) | 46,027 | |
Balance at End of Period (in shares) | 46,027 | |
Weighted average grant date fair value (in dollars per share) | $ 141 | |
Minimum | Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 0.00% | |
Maximum | Performance Based Shares | ||
Share-based Compensation Arrangement by Award [Line Items] | ||
Percentage of total units vested | 200.00% |
Fair Value Disclosures (Details
Fair Value Disclosures (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair Value Disclosures [Line Items] | ||
Notes payable, carrying value | $ 413,948 | $ 538,398 |
Senior Notes | ||
Fair Value Disclosures [Line Items] | ||
Notes payable, carrying value | 296,841 | 296,681 |
Senior notes, fair value | $ 338,080 | $ 340,388 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2021USD ($)lot | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | ||
Total lots under option contract to purchase | 28,784 | 26,236 |
FLORIDA | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Total lots under option contract to purchase | lot | 110 | |
Total purchase price for lots under option contract | $ 4 | |
Non-refundable deposit related to option contract | $ 0.2 | |
lgih_PurchasedLotsPreviouslyUnderPurchaseOptions | lot | 58 | |
lgih_LandunderPurchaseOptionsPurchasePrice | $ 2.1 | |
Central | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Total lots under option contract to purchase | lot | 25 | |
Total purchase price for lots under option contract | $ 2.5 | |
Maximum | FLORIDA | Affiliated Entity | ||
Related Party Transaction [Line Items] | ||
Annual price escalation rate | 6.00% |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2021USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Other Commitments [Line Items] | |||
Land deposits and option payments | $ 35,484 | $ 34,097 | |
Commitments under the land purchase contracts if the purchases are consummated | $ 728,140 | $ 663,006 | |
Lots under land purchase contracts | 28,784 | 26,236 | |
Refundable land deposits of purchase contracts of finished lots | $ 25,100 | $ 24,000 | |
Operating Lease, Right-of-Use Asset | 4,900 | ||
Present value of operating lease liabilities | 5,249 | 5,287 | |
Operating Lease, Cost | 400 | ||
Operating Lease, Payments | $ 200 | $ 400 | |
Operating lease, weighted average discount rate | 5.24% | ||
Operating lease, weighted average remaining lease term | 4 years 9 months 18 days | ||
Letters of credit, surety bonds, and other financials guarantees | $ 167,600 | 143,800 | |
Contributions to limited partnership | 2,200 | $ 3,900 | |
Not Primary Beneficiary | |||
Other Commitments [Line Items] | |||
Limited partnership, maximum commitment | $ 30,000 | ||
Limited partnership, term | 8 years | ||
Limited partnership, renewal term | 2 years | ||
Revolving Credit Facility | |||
Other Commitments [Line Items] | |||
Letters of credit outstanding under revolving credit facility | $ 10,300 |
Commitments and Contingencies F
Commitments and Contingencies Future Minimum Operating Lease Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
2021 | $ 997 | |
2022 | 1,138 | |
2023 | 1,007 | |
2024 | 776 | |
2025 | 517 | |
Thereafter | 1,762 | |
Total | 6,197 | |
Lease amount representing interest | (948) | |
Operating Lease, Liability | $ 5,249 | $ 5,287 |
Segment Information (Details)
Segment Information (Details) | 3 Months Ended | ||
Mar. 31, 2021USD ($)business | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($) | |
Segment Reporting Information [Line Items] | |||
Assets | $ 1,825,486,000 | $ 1,826,087,000 | |
Home sales revenues | $ 705,953,000 | $ 454,727,000 | |
Number of reporting segments | business | 5 | ||
Number of operating segments | business | 7 | ||
Net income before income taxes | $ 123,276,000 | 54,889,000 | |
Pre-acquisition costs and deposits | 39,488,000 | 37,213,000 | |
Central | |||
Segment Reporting Information [Line Items] | |||
Assets | 679,525,000 | 708,087,000 | |
Home sales revenues | 288,750,000 | 165,775,000 | |
Net income before income taxes | 55,634,000 | 24,234,000 | |
Southeast | |||
Segment Reporting Information [Line Items] | |||
Assets | 381,246,000 | 401,725,000 | |
Home sales revenues | 136,551,000 | 88,447,000 | |
Net income before income taxes | 19,831,000 | 7,908,000 | |
Northwest | |||
Segment Reporting Information [Line Items] | |||
Assets | 251,325,000 | 252,098,000 | |
Home sales revenues | 118,191,000 | 101,948,000 | |
Net income before income taxes | 25,994,000 | 16,527,000 | |
West | |||
Segment Reporting Information [Line Items] | |||
Assets | 264,832,000 | 228,186,000 | |
Home sales revenues | 81,148,000 | 58,485,000 | |
Net income before income taxes | 12,611,000 | 5,272,000 | |
Florida | |||
Segment Reporting Information [Line Items] | |||
Assets | 157,561,000 | 157,169,000 | |
Home sales revenues | 81,313,000 | 40,072,000 | |
Net income before income taxes | 10,816,000 | 2,525,000 | |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Assets | 90,997,000 | $ 78,822,000 | |
Net income before income taxes | $ (1,610,000) | $ (1,577,000) | |
Operating Segments | Central | |||
Segment Reporting Information [Line Items] | |||
Percentage of operations | 40.90% | 36.50% | |
Intersegment Eliminations | |||
Segment Reporting Information [Line Items] | |||
Home sales revenues | $ 0 |