01—Abstract
Summary
Summary of the 10-K/A filed December 22, 2006. Cited figures are marked; the original filing is the authoritative source.
This Form 10-K/A is Amendment No. 1 to Pulte Homes, Inc.'s annual report for the fiscal year ended December 31, 2005, filed to restate Note 2 (segment information) under SFAS No. 131.
The restatement expands homebuilding segment disclosure into seven reportable segments (Northeast, Southeast, Florida, Midwest, Central, Southwest, and California) for 2005, 2004 and 2003. The filing states the restatement has no impact on the consolidated balance sheets, statements of operations, cash flows, or shareholders' equity. Forward-looking information has not been updated for events after the original filing.
Financially, the company reported 2005 consolidated revenues of $14.69 billiona and net income of $1.49 billion, or $5.68 per diluted share, up from $986.5 million in 2004. Homebuilding settlement revenues reached $14.37 billion on a record 45,630 units, with an average selling price of $315,000 and backlog of 17,817 units valued at approximately $6.3 billion at year-end. Homebuilding pre-tax income was $2.30 billion, and the gross profit margin from home sales rose to 23.4%.
Total assets were $13.05 billionb and shareholders' equity was $5.96 billion at December 31, 2005. The filing also highlights a $48.7 million judgment received in December 2005 related to First Heights litigation against the U.S. government, recorded as discontinued operations income, and the December 2005 sale of substantially all Mexico homebuilding operations for $131.5 million in cash. Risk factors include a potential EPA/DOJ storm water discharge enforcement matter for which the company cannot estimate costs.
02—Key points
Key Highlights
- Net income of $1,491.9 million in 2005 versus $986.5 million in 2004; diluted EPS of $5.68 versus $3.79
- Record 45,630 home settlements in 2005 with homebuilding settlement revenues of $14.37 billion
- Average unit selling price rose to $315,000 in 2005 from $287,000 in 2004; gross margin from home sales of 23.4%
- Backlog of 17,817 units valued at approximately $6.3 billion at December 31, 2005
- Restated segment note now reports seven homebuilding segments; the restatement does not change consolidated financial statements
- Received $48.7 million judgment payment in December 2005 related to First Heights litigation, recorded in discontinued operations
- Sold substantially all Mexico homebuilding operations in December 2005 for $131.5 million in cash
03—Questions
Frequently Asked Questions
Why was this 10-K/A filed?
The amendment restates Note 2 of the consolidated financial statements to expand reportable segment disclosure under SFAS No. 131, changing the homebuilding presentation from a single reportable segment to seven. The filing states there is no impact on the consolidated balance sheets, statements of operations, cash flows, or shareholders' equity.
How did Pulte Homes perform financially in 2005?
Consolidated revenues were $14.69 billion and income from continuing operations was $1.44 billion for 2005. Net income was $1.49 billion, or $5.68 per diluted share, compared with $986.5 million, or $3.79 per diluted share, in 2004. Homebuilding pre-tax income was $2.30 billion.
What does the restated segment information show?
The company reports seven homebuilding segments: Northeast, Southeast, Florida, Midwest, Central, Southwest and California, plus a financial services segment. For 2005, Southwest had the largest settlement revenues at $3.26 billion, and California had $3.21 billion, with pre-tax income of $745.2 million and $654.9 million, respectively.
What legal or regulatory risks does the filing disclose?
The company disclosed an EPA request under the Clean Water Act regarding storm water discharge practices, which has been referred to the Department of Justice. The company is in pre-filing negotiations and states it cannot predict the outcome or estimate costs. Separately, it stated that litigation is not expected to have a material adverse impact.
What is the outlook for the company's cash position and liquidity?
At December 31, 2005, cash and equivalents were $1.00 billion and senior notes outstanding totaled $3.4 billion. The company had a $1.66 billion committed unsecured revolving credit facility, and its debt-to-total capitalization excluding collateralized debt was approximately 36.2%. The filing notes that forward-looking information has not been updated for subsequent events.
04—Continue