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Press Release: Century Communities Reports Record -4-

· 02/04/2021 16:05
CONTACT: Hunter Wells, Vice President of Investor Relationsincome tax expense. Century Communities, Inc. Reconciliation of Non-GAAP Financial Measures (Unaudited) Adjusted homebuilding gross margin excluding impairment, interest and purchase price accounting for acquired work in process inventory is not a measurement of financial performance under United States generally accepted accounting principles; however, the Company's management believes that this information is meaningful as it isolates the impact that inventory impairment, indebtedness and acquisitions have on homebuilding gross margin and permits the Company's stockholders to make better comparisons with the Company's competitors, who adjust gross margins in a similar fashion. This non-GAAP financial measure should not be used as a substitute for the Company's operating results. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. Adjusted Homebuilding Gross Margin (in thousands) Three months ended December 31, ------------------------------------------------ 2020 % 2019 % ------------ --------- ------------ --------- Home sales revenues $ 946,803 100.0% $ 775,667 100.0% Cost of home sales revenues (749,587) (79.2)% (632,722) (81.6)% Inventory impairment (481) (0.1)% (1,993) (0.3)% ---------- ----- ---------- ----- Gross margin from home sales 196,735 20.8% 140,952 18.2% Add: Inventory impairment 481 0.1% 1,993 0.3% Add: Interest in cost of home sales revenues 20,573 2.2% 19,651 2.5% ---------- ----- ---------- ----- Adjusted homebuilding gross margin excluding interest and inventory impairment 217,789 23.0% 162,596 21.0% Add: Purchase price accounting for acquired work in process inventory -- --% -- --% ---------- ----- ---------- ----- Adjusted homebuilding gross margin excluding interest, inventory impairment and purchase price accounting for acquired work in process inventory $ 217,789 23.0% $ 162,596 21.0% ========== ===== ========== ===== Year ended December 31, ------------------------------------------------ 2020 % 2019 % ------------ --------- ------------ --------- Home sales revenues $ 3,027,167 100.0% $ 2,481,465 100.0% Cost of home sales revenues (2,468,133) (81.5)% (2,040,241) (82.2)% Inventory impairment (2,172) (0.1)% (1,993) (0.1)% ---------- ----- ---------- ----- Gross margin from home sales 556,862 18.4% 439,231 17.7% Add: Inventory impairment 2,172 0.1% 1,993 0.1% Add: Interest in cost of home sales revenues 72,002 2.4% 61,150 2.5% ---------- ----- ---------- ----- Adjusted homebuilding gross margin excluding interest and inventory impairment 631,036 20.8% 502,374 20.2% Add: Purchase price accounting for acquired work in process inventory -- --% 1,724 0.1% ---------- ----- ---------- ----- Adjusted homebuilding gross margin excluding interest, inventory impairment and purchase price accounting for acquired work in process inventory $ 631,036 20.8% $ 504,098 20.3% ========== ===== ========== ===== Century Communities, Inc. Reconciliation of Non-GAAP Financial Measures (Unaudited) Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure we use as a supplemental measure in evaluating operating performance. The Company defines adjusted EBITDA as consolidated net income before (i) income tax expense, (ii) interest in cost of home sales revenues, (iii) other interest expense, (iv) loss on debt extinguishment, (v) inventory impairment and other, (vi) depreciation and amortization expense, and (vii) adjustments resulting from the application of purchase accounting for acquired work in process inventory related to business combinations. The Company believes adjusted EBITDA provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, and items considered to be non-recurring. Accordingly, the Company's management believes that this measurement is useful for comparing general operating performance from period to period. Adjusted EBITDA should be considered in addition to, and not as a substitute for, consolidated net income in accordance with GAAP as a measure of performance. The Company's presentation of adjusted EBITDA should not be construed as an indication that its future results will be unaffected by unusual or non-recurring items. Adjusted EBITDA is limited as an analytical tool and should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. (in thousands) Three months ended December 31, Year ended December 31, ------------------------------- --------------------------------- 2020 2019 % Change 2020 2019 % Change -------- ------- ----------- -------- -------- ------------ Net income $ 91,817 $53,358 72.1% $206,157 $112,994 82.4% Income tax expense 29,347 610 4,711.0% 64,083 19,641 226.3% Interest in cost of home sales revenues 20,573 19,651 4.7% 72,002 61,150 17.7% Interest expense (income) (112) -- NM (1,141) 16 (7,231.3)% Depreciation and amortization expense 3,053 3,589 (14.9)% 13,141 13,382 (1.8)% ------- ------ ------- ------- ------- -------- EBITDA 144,678 77,208 87.4% 354,242 207,183 71.0% Loss on debt extinguishment -- -- NM -- 10,832 NM Inventory impairment and other 481 4,783 (89.9)% 2,172 4,783 (54.6)% Purchase price accounting for acquired work in process inventory -- -- NM -- 1,724 NM ------- ------ ------- ------- ------- -------- Adjusted EBITDA $145,159 $81,991 77.0% $356,414 $224,522 58.7% ======= ====== ======= ======= ======= ======== NM -- Not Meaningful Century Communities, Inc. Reconciliation of Non-GAAP Financial Measures (Unaudited) Ratio of Net Homebuilding Debt to Net Capital The following table presents the Company's ratio of net homebuilding debt to net capital, which is a non-GAAP financial measure. The Company calculates this by dividing net homebuilding debt (notes payable and revolving line of credit less cash and cash equivalents and cash held in escrow) by net capital (net homebuilding debt plus total stockholders' equity). The most directly comparable GAAP measure is the ratio of debt to capital. The Company believes the ratio of net homebuilding debt to net capital is a relevant and useful financial measure to investors in understanding the leverage employed in its operations and as an indicator of the Company's ability to obtain external financing. (in thousands) December 31, December 31, 2020 2019 -------------------- ----------------- Total homebuilding debt $ 894,875 $ 965,404 Total stockholders' equity 1,280,705 1,061,699 ------------ ------------ Total capital $ 2,175,580 $ 2,027,103 ------------ ------------ Homebuilding debt to capital 41.1% 47.6% ============ ============ Total homebuilding debt $ 894,875 $ 965,404 Cash and cash equivalents (394,001) (55,436) Cash held in escrow (23,149) (35,308) ------------ ------------ Net homebuilding debt $ 477,725 $ 874,660 Total stockholders' equity 1,280,705 1,061,699 ------------ ------------ Net capital $ 1,758,430 $ 1,936,359 ============ ============ Net homebuilding debt to net capital 27.2% 45.2% ============ ============

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February 04, 2021 16:05 ET (21:05 GMT)