M/I Homes (MHO) Q2 2024 earnings summary

Executive summary

• Achieved all-time quarterly records in revenue, net income, gross margin, pre-tax margin, and diluted EPS for Q2 2024, with homes delivered up 12% year-over-year to 2,224 and new contracts up 3%.

• Net income rose 24% to $146.7M for Q2 2024, with diluted EPS at $5.12 and shareholders' equity reaching a record $2.74B; book value per share was $100.

• Gross margin improved to a record 27.9% in Q2, up 240 basis points year-over-year.

• Pre-tax income was $194.1M, up 25% year-over-year, with pre-tax margins at 17.5%.

• Demand and traffic slowed from Q1, but housing market fundamentals remain strong, supported by millennial and Gen Z buyers.

Financial highlights

• Q2 2024 revenue increased 9% year-over-year to $1.1B; homes delivered rose 12% to 2,224.

• Gross margin reached 27.9% in Q2; pre-tax margin was 17.5%.

• Net income for Q2 2024 was $146.7M ($5.12 per diluted share), up 24% from Q2 2023.

• EBITDA for the quarter was $200M, up from $164M in Q2 2023.

• Financial services segment posted record quarterly revenue of $30.8M, up 22% year-over-year.

Outlook and guidance

• Management expects a strong 2024, with plans to open more communities, increase land spending, and grow average community count by about 5%.

• Margins expected to remain strong, though sustainability may be challenged if incentives persist.

• Strategic focus includes managing land spend, maintaining liquidity, and emphasizing customer service.

• Ended Q2 with 49,500 lots under control, a 20% increase year-over-year.