Skip to content
AnalystLens

Pultegroup Annual Report, Year Ended Dec 31, 2005

Filing Date
Filed March 10, 2006
Period End
December 31, 2005
Security
PHM
In the record · 2016–202610-K1110-Q338-K109

PHM filed 11 annual reports (10-K), 33 quarterly reports (10-Q) and 109 current reports (8-K) between 2016 and 2026.

  1. Impairment8-K · May ’17May ’17
  2. Leadership change8-K · Mar ’19Mar ’19
  3. Material agreement8-K · Jul ’21Jul ’21
  4. Material agreement8-K · Aug ’25Aug ’25

01—Abstract

Summary

Summary of the 10-K filed March 10, 2006. Cited figures are marked; the original filing is the authoritative source.

Pulte Homes, Inc. reported record 2005 results, with net income of $1.49 billiona ($5.68 per diluted share) on revenues of $14.69 billion, up from $986.5 million in 2004.

Homebuilding settlement revenues reached $14.37 billionb on a record 45,630 homes closed, at an average unit selling price of $315,000. Homebuilding pre-tax income was $2.30 billion, and the year-end backlog grew to 17,817 units valued at approximately $6.3 billion. The filing describes continued strong demand, market share gains, and a homebuilding gross profit margin from home sales of 23.4%, although the fourth-quarter margin fell to 22.3% due to inflation in land development costs.

Operating cash flow was only $18.7 millionc in 2005, compared with cash used of $692.2 million in 2004, as inventory investment of $1.69 billion absorbed cash. The company ended the year with $1.00 billion in cash and equivalents and total assets of $13.05 billion. Senior and subordinated notes totaled $3.39 billion, and the debt-to-total capitalization ratio, excluding collateralized debt, was approximately 36.2%.

Shareholders' equity rose to $5.96 billiond. The results include $48.7 million received in December 2005 from a favorable federal judgment on the former First Heights thrift operation, recorded as discontinued operations income. The company sold its Argentina operations in January 2005 and substantially all of its Mexico homebuilding operations in December 2005, realizing cash of $131.5 million from the Mexico sale.

In February 2006, the board increased the stock repurchase authorization by $200 million, bringing the available total to $219.5 million. The filing also discloses an ongoing EPA storm water discharge inquiry, which has been referred to the Department of Justice, and the company states it cannot currently estimate the costs of its resolution.

02—Key points

Key Highlights

  1. Net income of $1,491.9 million, or $5.68 per diluted share, for 2005, up from $986.5 million ($3.79 per diluted share) in 2004.
  2. Record 45,630 homes settled in 2005, generating $14.37 billion in homebuilding settlement revenues; net new orders rose to a record 47,531 units.
  3. Average unit selling price increased to $315,000 in 2005 from $287,000 in 2004; homebuilding gross profit margin from home sales was 23.4%.
  4. Backlog reached 17,817 units valued at approximately $6.3 billion at December 31, 2005, compared with $5.2 billion a year earlier.
  5. Operating cash flow was only $18.7 million in 2005, as inventories increased by $1.69 billion to support growth.
  6. Year-end cash of $1.00 billion, senior and subordinated notes of $3.39 billion, and debt-to-total capitalization of about 36.2% excluding collateralized debt.
  7. Board approved an additional $200 million stock repurchase authorization in February 2006, bringing available capacity to $219.5 million.

03—Questions

Frequently Asked Questions

  1. What drove the increase in Pulte's 2005 profitability?

    The filing attributes higher homebuilding pre-tax income to continued strong demand for new homes, market share gains, geographic and product mix shifts, higher average unit selling prices, and initiatives to simplify processes and leverage construction costs. Homebuilding pre-tax income rose to $2.30 billion from $1.64 billion in 2004.

  2. Why was operating cash flow so low in 2005?

    Operating cash flow was $18.7 million, principally because inventory investment of $1.69 billion and an increase in residential mortgage loans held for sale absorbed cash. The filing notes that net income growth was partly offset by significant investments in land to support growth.

  3. What were the main discontinued operations in 2005?

    The company sold its Argentina operations in January 2005 and substantially all of its Mexico homebuilding operations in December 2005, realizing cash of $131.5 million from the Mexico sale. Discontinued operations also included the First Heights thrift, which received $48.7 million from a favorable federal judgment in December 2005.

  4. What risks does the filing highlight for future results?

    The risk factors cite the possibility of a downturn in economic or real estate conditions after several years without one, rising interest rates and reduced mortgage availability, competition for land and homebuyers, supply shortages of labor and materials, government regulation, warranty and liability claims, and natural disasters. The company also notes an EPA storm water discharge inquiry that has been referred to the Department of Justice, with costs that cannot currently be estimated.

04—Continue

← View all 10-K filings