Green Brick Partners (GRBK) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 results with 987 homes closed, $547M in home closing revenue (up 20.4% year-over-year), and 26.1% growth in home deliveries, driven by strong demand and expanded community count.

• Homebuilding gross margin reached a record 34.5%, up 320 bps year-over-year, the highest among public peers.

• Net income attributable to the company rose 40% year-over-year to $105M in Q2, with diluted EPS up 42.3% to $2.32.

• 80% of H1 2024 revenues came from infill and infill-adjacent locations, benefiting from supply shortages and demographic trends.

• Announced transition to a wholly owned mortgage company, expected to capture 100% of mortgage profits starting 2025.

Financial highlights

• Q2 2024 total revenues: $560.6M, up 22.9% year-over-year; home closing revenue: $547M, up 20.4%; 987 homes closed, up 26.1%.

• Net income for Q2: $105.4M, up 40% year-over-year; diluted EPS: $2.32, up 42.3%.

• Homebuilding gross margin: 34.5%, up 320 bps year-over-year; adjusted margin for Q2: 35.1%.

• SG&A as a percentage of revenue improved to 10.5% in Q2 2024.

• Backlog value at Q2 end increased 11% year-over-year to $650.3M; backlog ASP up 10.1% to $732,000.

Outlook and guidance

• ASP expected to remain in the $540,000–$560,000 range for H2 2024, subject to product mix and market conditions.

• Management expects continued strong demand in high-growth markets, with a focus on expanding the Trophy Signature Homes brand and prudent leverage.

• On track to meet $700M land acquisition and development target for 2024; inventory of finished lots expected to reach 4,700 by year-end.

• Sufficient liquidity and capital resources are anticipated to support operations and debt service over the next twelve months.

• Intends to keep debt to capital ratio below 30% to support operational and financial growth.