CAVCO INDUSTRIES, INC. 10-Q

Item 1. Financial Statements CAVCO INDUSTRIES, INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands, except per share amounts) December 27, 2025 March 29, 2025 ASSETS (Unaudited) Current assets Cash and cash equivalents $ 224,616 $ 356,225 Restricted cash, current 17,271 18,535 Accounts receivable, net 105,956 105,849 Short-term investments 17,277 19,842 Current portion of consumer loans receivable, net 38,679 35,852 Current portion of commercial loans receivable, net 45,659 43,492 Current portion of commercial loans receivable from affiliates, net 2,015 2,881 Inventories 290,540 252,695 Prepaid expenses and other current assets 74,782 74,815 Total current assets 816,795 910,186 Restricted cash 585 585 Investments 24,782 18,067 Consumer loans receivable, net 20,104 20,685 Commercial loans receivable, net 53,393 48,605 Commercial loans receivable from affiliates, net 5,163 4,768 Property, plant and equipment, net 276,716 227,620 Goodwill 207,803 121,969 Other intangibles, net 28,678 16,731 Operating lease right-of-use assets 38,176 35,576 Deferred income taxes — 1,853 Total assets $ 1,472,195 $ 1,406,645 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 35,003 $ 37,195 Accrued expenses and other current liabilities 293,674 265,971 Total current liabilities 328,677 303,166 Operating lease liabilities 34,065 31,538 Other liabilities 7,210 7,359 Deferred income taxes 13,024 — Total liabilities 382,976 342,063 Stockholders' equity Preferred stock, $ 0.01 par value; 1,000,000 shares authorized; No shares issued or outstanding — — Common stock, $ 0.01 par value; 40,000,000 shares authorized; Issued 9,471,289 and 9,436,732 shares, respectively; Outstanding 7,786,626 and 8,008,012 shares, respectively 95 94 Treasury stock, at cost; 1,684,663 and 1,428,720 shares, respectively ( 555,587 ) ( 424,624 ) Additional paid-in capital 298,231 290,940 Retained earnings 1,346,253 1,198,163 Accumulated other comprehensive income 227 9 Total stockholders' equity 1,089,219 1,064,582 Total liabilities and stockholders' equity $ 1,472,195 $ 1,406,645 See accompanying Notes to Consolidated Financial Statements 1 Table of Contents CAVCO INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Dollars in thousands, except per share amounts) (Unaudited) Three Months Ended Nine Months Ended December 27, 2025 December 28, 2024 December 27, 2025 December 28, 2024 Net revenue $ 580,994 $ 522,040 $ 1,694,378 $ 1,507,100 Cost of sales 445,073 392,090 1,294,544 1,157,626 Gross profit 135,921 129,950 399,834 349,474 Selling, general and administrative expenses 81,361 65,980 222,738 197,828 Income from operations 54,560 63,970 177,096 151,646 Interest income 2,956 5,353 13,105 16,556 Interest expense ( 131 ) ( 155 ) ( 407 ) ( 370 ) Other income, net 213 168 355 315 Income before income taxes 57,598 69,336 190,149 168,147 Income tax expense ( 13,531 ) ( 12,874 ) ( 42,059 ) ( 33,441 ) Net income $ 44,067 $ 56,462 $ 148,090 $ 134,706 Comprehensive income Net income $ 44,067 $ 56,462 $ 148,090 $ 134,706 Reclassification adjustment for securities sold ( 10 ) ( 97 ) 243 174 Applicable income tax (expense) benefit 2 20 ( 51 ) ( 37 ) Net change in unrealized position of investments held 21 8 33 62 Applicable income tax expense ( 5 ) ( 2 ) ( 7 ) ( 13 ) Comprehensive income $ 44,075 $ 56,391 $ 148,308 $ 134,892 Net income per share Basic $ 5.65 $ 6.97 $ 18.78 $ 16.42 Diluted $ 5.58 $ 6.90 $ 18.55 $ 16.25 Weighted average shares outstanding Basic 7,801,698 8,096,538 7,887,594 8,203,448 Diluted 7,891,093 8,186,814 7,981,609 8,291,647 See accompanying Notes to Consolidated Financial Statements 2 Table of Contents CAVCO INDUSTRIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in thousands) (Unaudited) Nine Months Ended December 27, 2025 December 28, 2024 OPERATING ACTIVITIES Net income $ 148,090 $ 134,706 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 16,663 14,304 Provision for credit losses ( 176 ) ( 874 ) Deferred income taxes 9,170 17 Stock-based compensation expense 10,265 6,653 Non-cash interest income, net ( 582 ) ( 787 ) Gain on sale or retirement of property, plant and equipment, net ( 44 ) ( 19 ) Gain on investments and sale of loans, net ( 3,671 ) ( 1,901 ) Changes in operating assets and liabilities, net of acquisitions Accounts receivable 5,225 ( 14,762 ) Consumer loans receivable originated ( 43,040 ) ( 54,155 ) Proceeds received on consumer loans receivable 42,757 47,026 Inventories 10,010 ( 1,960 ) Prepaid expenses and other current assets 4,560 4,997 Commercial loans receivable originated ( 117,299 ) ( 87,543 ) Principal payments received on commercial loans receivable 110,800 85,008 Accounts payable, accrued expenses and other liabilities 7,391 9,141 Net cash provided by operating activities 200,119 139,851 INVESTING ACTIVITIES Purchases of property, plant and equipment ( 27,360 ) ( 15,288 ) Payments for acquisitions, net ( 171,446 ) — Proceeds from sale of property, plant and equipment 158 194 Purchases of investments ( 18,952 ) ( 21,588 ) Proceeds from sale of investments 17,748 22,706 Net cash used in investing activities ( 199,852 ) ( 13,976 ) FINANCING ACTIVITIES Payments for taxes on stock option exercises and releases of equity awards ( 4,949 ) ( 3,425 ) Proceeds from exercise of stock options 1,884 2,130 Payments on finance leases and other secured financings ( 184 ) ( 261 ) Payments for common stock repurchases ( 129,891 ) ( 114,446 ) Net cash used in financing activities ( 133,140 ) ( 116,002 ) Net (decrease) increase in cash, cash equivalents and restricted cash ( 132,873 ) 9,873 Cash, cash equivalents and restricted cash at beginning of the fiscal year 375,345 368,753 Cash, cash equivalents and restricted cash at end of the period $ 242,472 $ 378,626 Supplemental disclosures of cash flow information Cash paid for income taxes $ 29,676 $ 34,173 Cash paid for interest $ 205 $ 30 Supplemental disclosures of noncash activity Payable due for acquisition of a business $ 3,358 $ — Fair value of contingent acquisition purchase price receivable $ 4,838 $ — Change in GNMA loans eligible for repurchase $ 347 $ 730 See accompanying Notes to Consolidated Financial Statements 3 Table of Contents CAVCO INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. Basis of Presentation The accompanying unaudited Consolidated Financial Statements of Cavco Industries, Inc. and its subsidiaries (collectively, "we," "us," "our," the "Company" or "Cavco") have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") for Quarterly Reports on Form 10-Q and Article 10 of SEC Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") have been condensed or omitted pursuant to such rules and regulations. In addition, references throughout to numbered "Notes" refer to these Notes to Consolidated Financial Statements (Unaudited), unless otherwise stated. In the opinion of management, these financial statements include all adjustments, including normal recurring adjustments, which are necessary to fairly state the interim results for the periods presented. We have evaluated subsequent events after the balance sheet date through the date of the filing of this report with the SEC, and there were no disclosable subsequent events. These Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the Notes to the Consolidated Financial Statements included in our 2025 Annual Report on Form 10-K for the year ended March 29, 2025, filed with the SEC ("Form 10-K"). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying Notes. Due to uncertainties, actual results could differ from the estimates and assumptions used in preparation of the Consolidated Financial Statements. The Consolidated Statements of Comprehensive Income and Consolidated Statements of Cash Flows for the interim periods are not necessarily indicative of the results or cash flows for the full year. The Company operates on a 52-53 week fiscal year ending on the Saturday nearest to March 31st of each year. Each fiscal quarter consists of 13 weeks, with an occasional fourth quarter extending to 14 weeks, if necessary, for the fiscal year to end on the Saturday nearest March 31st. The current fiscal year will end on March 28, 2026 and will include 52 weeks. As disclosed on our Form 8-K filed on September 30, 2025, on September 29, 2025, we acquired American Homestar Corporation ("American Homestar"), including its two manufacturing facilities, nineteen wholly-owned retail locations and financial service operations. The results of operations are included in our Consolidated Financial Statements from the date of acquisition. See Note 19. For a description of significant accounting policies used in the preparation of our Consolidated Financial Statements, please refer to Note 1 of the Notes to Consolidated Financial Statements included in the Form 10-K. 2. Recent Accounting Pronouncements The Company considers the applicability and impact of all Accounting Standards Updates ("ASUs") issued by the Financial Accounting Standards Board ("FASB"). ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on the Company's Consolidated Financial Statements. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires companies to enhance the disclosures about segment expenses. The new standard requires the identification and disclosure of the Company's Chief Operating Decision Maker ("CODM"), expanded incremental line-item disclosures of significant segment expenses used by the CODM for decision-making, and the inclusion of previous annual only segment disclosure requirements on a quarterly basis. This ASU should be applied retrospectively for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. We adopted ASU 2023-07 effective for the annual period beginning March 31, 2024, and for interim periods beginning March 30, 2025. ASU 2023-07 is applied retrospectively to all prior periods presented in the accompanying Consolidated Financial Statements. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Taxes Disclosures, which requires greater disaggregation of income tax disclosures. The new standard requires additional 4 Table of Contents information to be disclosed with respect to the income tax rate reconciliation and income taxes paid disaggregated by jurisdiction. This ASU should be applied prospectively for fiscal years beginning after December 15, 2024, with retrospective application permitted. The Company is currently evaluating the impacts of this guidance on the Company's Consolidated Financial Statements. In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses ("ASU 2024-03"), and in January 2025, the FASB issued ASU No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date ("ASU 2025-01"). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Both early adoption and retrospective application are permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its Consolidated Financial Statements. 3. Revenue from Contracts with Customers The following table summarizes Net revenue disaggregated by reportable segment and source (in thousands): Three Months Ended Nine Months Ended December 27, 2025 December 28, 2024 December 27, 2025 December 28, 2024 Factory-built housing Home sales $ 532,497 $ 471,998 $ 1,551,983 $ 1,378,103 Delivery, setup and other revenues 26,000 28,862 77,325 67,148 558,497 500,860 1,629,308 1,445,251 Financial services Insurance agency commissions received from third-party insurance companies 1,975 1,246 4,899 3,920 All other sources 20,522 19,934 60,171 57,929 22,497 21,180 65,070 61,849 $ 580,994 $ 522,040 $ 1,694,378 $ 1,507,100 4. Cash and Cash Equivalents and Restricted Cash The following table provides a reconciliation of Cash and cash equivalents and Restricted cash reported within the Consolidated Balance Sheets to the combined amounts shown in the Consolidated Statements of Cash Flows (in thousands): December 27, 2025 December 28, 2024 Cash and cash equivalents $ 224,616 $ 362,863 Restricted cash, current 17,271 15,178 Restricted cash 585 585 $ 242,472 $ 378,626 5 Table of Contents 5. Investments Investments consisted of the following (in thousands): December 27, 2025 March 29, 2025 Available-for-sale debt securities $ 22,908 $ 21,415 Marketable equity securities 13,499 11,425 Non-marketable equity investments 5,652 5,069 42,059 37,909 Less short-term investments ( 17,277 ) ( 19,842 ) $ 24,782 $ 18,067 The amortized cost and fair value of our investments in available-for-sale debt securities, by security type, are shown in the table below (in thousands): December 27, 2025 March 29, 2025 Amortized Cost Fair Value Amortized Cost Fair Value Residential mortgage-backed securities $ 10,691 $ 10,790 $ 4,122 $ 4,120 State and political subdivision debt securities 5,744 5,849 6,955 6,976 Corporate debt securities 6,186 6,269 10,326 10,319 $ 22,621 $ 22,908 $ 21,403 $ 21,415 The amortized cost and fair value of our investments in available-for-sale debt securities, by contractual maturity, are shown in the table below (in thousands). Expected maturities may differ from contractual maturities as borrowers at times have the right to call or prepay obligations, with or without penalties. December 27, 2025 Amortized Cost Fair Value Due in less than one year $ 1,939 $ 1,940 Due after one year through five years 6,510 6,637 Due after five years through ten years 910 924 Due after ten years 2,571 2,617 Mortgage-backed securities 10,691 10,790 $ 22,621 $ 22,908 Net investment gains and losses on marketable equity securities were as follows (in thousands): Three Months Ended Nine Months Ended December 27, 2025 December 28, 2024 December 27, 2025 December 28, 2024 Marketable equity securities Net gain (loss) recognized during the period $ 478 $ ( 954 ) $ 2,070 $ ( 440 ) Less: Net gain recognized on securities sold during the period ( 283 ) ( 1,649 ) ( 274 ) ( 1,561 ) Unrealized gain (loss) recognized during the period on securities still held $ 195 $ ( 2,603 ) $ 1,796 $ ( 2,001 ) 6 Table of Contents 6. Inventories Inventories consisted of the following (in thousands): December 27, 2025 March 29, 2025 Raw materials $ 86,573 $ 79,098 Work in process 35,004 29,808 Finished goods 168,963 143,789 $ 290,540 $ 252,695 7. Consumer Loans Receivable The following table summarizes consumer loans receivable (in thousands): December 27, 2025 March 29, 2025 Loans held for investment, previously securitized $ 11,392 $ 13,775 Loans held for investment 14,955 12,196 Loans held for sale 33,390 27,981 Construction advances 2,811 4,210 62,548 58,162 Deferred financing fees and other, net ( 1,780 ) ( 686 ) Allowance for loan losses ( 1,985 ) ( 939 ) 58,783 56,537 Less current portion ( 38,679 ) ( 35,852 ) $ 20,104 $ 20,685 The consumer loans held for investment had the following characteristics: December 27, 2025 March 29, 2025 Weighted average contractual interest rate 7.7 % 7.9 % Weighted average effective interest rate 7.6 % 10.3 % Weighted average months to maturity 236 221 The following table is a consolidated summary of the delinquency status of the outstanding principal balance of consumer loans receivable (in thousands): December 27, 2025 March 29, 2025 Current $ 59,408 $ 56,401 31 to 60 days 1,659 1,082 61 to 90 days 333 4 91+ days 1,148 675 $ 62,548 $ 58,162 7 Table of Contents The following table disaggregates the outstanding principal balance of consumer loans receivable by credit quality indicator and fiscal year of origination (in thousands): December 27, 2025 2026 2025 2024 2023 2022 Prior Total Prime- FICO score 680 and greater $ 18,517 $ 7,503 $ 4,463 $ 319 $ 89 $ 12,297 $ 43,188 Near Prime- FICO score 620-679 2,893 1,630 619 — — 8,671 13,813 Sub-Prime- FICO score less than 620 — — — — — 569 569 No FICO score 172 281 202 957 1,247 2,119 4,978 $ 21,582 $ 9,414 $ 5,284 $ 1,276 $ 1,336 $ 23,656 $ 62,548 March 29, 2025 2025 2024 2023 2022 2021 Prior Total Prime- FICO score 680 and greater $ 18,133 $ 9,209 $ 323 $ 92 $ 761 $ 13,197 $ 41,715 Near Prime- FICO score 620-679 2,948 1,210 — — 1,026 9,000 14,184 Sub-Prime- FICO score less than 620 537 — — — 17 680 1,234 No FICO score 317 441 — — — 271 1,029 $ 21,935 $ 10,860 $ 323 $ 92 $ 1,804 $ 23,148 $ 58,162 As of December 27, 2025, 47 % of the outstanding principal balance of the consumer loans receivable portfolio was concentrated in Texas and 12 % was concentrated in Florida. As of March 29, 2025, 54 % of the outstanding principal balance of the consumer loans receivable portfolio was concentrated in Texas and 11 % was concentrated in Florida. Other than Texas and Florida, no sta te had concentrations in excess of 10% of the outstanding principal balance of the consumer loans receivable as of December 27, 2025 or March 29, 2025. 8. Commercial Loans Receivable The commercial loans receivable balance consists of direct financing arrangements for the home product needs of our independent distributors, community owners and developers. Commercial loans receivable, net consisted of the following (in thousands): December 27, 2025 March 29, 2025 Loans receivable (including from affiliates) $ 106,811 $ 100,297 Allowance for loan losses ( 375 ) ( 361 ) Deferred financing fees, net ( 206 ) ( 190 ) 106,230 99,746 Less current portion of commercial loans receivable (including from affiliates), net ( 47,674 ) ( 46,373 ) $ 58,556 $ 53,373 The commercial loans receivable balance had the following characteristics: December 27, 2025 March 29, 2025 Weighted average contractual interest rate 7.8 % 8.3 % Weighted average months outstanding 10 10 8 Table of Contents The following table disaggregates the outstanding principal balance of our commercial loans receivable by fiscal year of origination (in thousands): December 27, 2025 2026 2025 2024 2023 2022 Prior Total Performing $ 62,873 $ 27,832 $ 13,632 $ 1,947 $ 339 $ 188 $ 106,811 March 29, 2025 2025 2024 2023 2022 2021 Prior Total Performing $ 66,843 $ 24,215 $ 7,006 $ 1,014 $ 1,219 $ — $ 100,297 As of December 27, 2025, our outstanding commercial loans receivable principal balance was concentrated primarily in Arizona 15 %, New York 14 %, California 13 % and North Carolina 12 %. As of March 29, 2025, concentrations were 16 % in California and 17 % in New York. We had concentrations with one independent third-party and its affiliates that equaled 10 % of the net commercial loans receivable principal balance outstanding, all of which was secured, as of December 27, 2025 and March 29, 2025. The risks created by these concentrations have been considered in the determination of the adequacy of the allowance for loan losses. 9. Goodwill and Other Intangibles, net Goodwill and other intangibles, net, consisted of the following (in thousands): December 27, 2025 March 29, 2025 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Indefinite-lived Goodwill $ 207,803 $ — $ 207,803 $ 121,969 $ — $ 121,969 Trademarks and trade names 7,020 — 7,020 7,020 — 7,020 State insurance licenses 1,100 — 1,100 1,100 — 1,100 215,923 — 215,923 130,089 — 130,089 Finite-lived Customer relationships 28,300 ( 7,905 ) 20,395 15,000 ( 6,676 ) 8,324 Other 1,114 ( 951 ) 163 1,114 ( 827 ) 287 $ 245,337 $ ( 8,856 ) $ 236,481 $ 146,203 $ ( 7,503 ) $ 138,700 Changes to Goodwill for the nine months ended December 27, 2025 were as follows (in thousands): Goodwill beginning of the period $ 121,969 American Homestar Acquisition (1) 85,834 Goodwill end of the period $ 207,803 (1) See Note 19, Acquisition 9 Table of Contents Amortization expense recognized on intangible assets for the three and nine months ended December 27, 2025 was $ 0.6 million and $ 1.4 million, respectively. Amortization expense recognized on intangible assets for the three and nine months ended December 28, 2024 was $ 0.4 million and $ 1.2 million, respectively. Customer relationships have a weighted average remaining life of 9.2 years and other finite lived intangibles have a weighted average remaining life of 0.5 years. Expected future amortization is as follows (in thousands): Remainder of fiscal year 2026 $ 599 Fiscal 2027 2,375 Fiscal 2028 2,249 Fiscal 2029 2,215 Fiscal 2030 1,935 Fiscal 2031 1,795 Thereafter 9,390 $ 20,558 10. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following (in thousands): December 27, 2025 March 29, 2025 Salaries, wages and benefits $ 49,508 $ 45,640 Customer deposits 48,259 46,934 Estimated warranties 39,954 33,189 Unearned insurance premiums 32,306 33,863 Accrued volume rebates 31,120 21,208 Accrued insurance 13,253 13,094 Insurance loss reserves 10,929 16,201 Other 68,345 55,842 $ 293,674 $ 265,971 11. Warranties Activity in the liability for estimated warranties was as follows (in thousands): Three Months Ended Nine Months Ended December 27, 2025 December 28, 2024 December 27, 2025 December 28, 2024 Balance at beginning of period $ 35,577 $ 33,081 $ 33,189 $ 31,718 Purchase accounting additions 2,231 — 2,231 — Charged to costs and expenses 20,524 14,322 54,172 40,403 Payments and deductions ( 18,378 ) ( 12,991 ) ( 49,638 ) ( 37,709 ) Balance at end of period $ 39,954 $ 34,412 $ 39,954 $ 34,412 10 Table of Contents 12. Other Liabilities The following table summarizes secured financings and other obligations (in thousands): December 27, 2025 March 29, 2025 Finance lease liabilities $ 6,025 $ 6,086 Other secured financing 1,476 1,594 7,501 7,680 Less current portion included in Accrued expenses and other current liabilities ( 291 ) ( 321 ) $ 7,210 $ 7,359 13. Debt We are party to an Amended and Restated Credit Agreement among the Company, Bank of America, N.A., as administrative agent, swing line lender, and letter of credit issuer, and the guarantors party thereto (the "Credit Agreement"), providing for a $ 75 million revolving credit facility (the "Revolving Credit Facility"), including a $ 10 million letter of credit sub-facility. The Revolving Credit Facility is guaranteed, on a joint and several basis, by certain of the Company's subsidiaries. Subject to certain conditions and requirements set forth in the Credit Agreement, including the availability of additional lender commitments, the Company may request from time to time one or more term loan facilities, or increases in the aggregate commitments under the Revolving Credit Facility, in an aggregate amount not exceeding $ 75 million up to $ 150 million. As of December 27, 2025 and March 29, 2025, there were no borrowings outstanding under the Revolving Credit Facility and we were in compliance with all covenants. 14. Reinsurance and Insurance Loss Reserves Certain of Standard Casualty Company's premiums and benefits are assumed from and ceded to other insurance companies under various reinsurance agreements. We remain obligated for amounts ceded in the event that the reinsurers do not meet their obligations. 11 Table of Contents The effects of reinsurance on premiums written and earned were as follows (in thousands): Three Months Ended December 27, 2025 December 28, 2024 Written Earned Written Earned Direct premiums $ 9,643 $ 11,084 $ 19,260 $ 24,645 Assumed premiums—nonaffiliated 9,996 11,018 21,534 20,629 Ceded premiums—nonaffiliated ( 7,309 ) ( 7,309 ) ( 17,387 ) ( 17,387 ) $ 12,330 $ 14,793 $ 23,407 $ 27,887 Nine Months Ended December 27, 2025 December 28, 2024 Written Earned Written Earned Direct premiums $ 31,086 $ 33,800 $ 32,763 $ 36,947 Assumed premiums—nonaffiliated 33,194 32,851 33,269 30,133 Ceded premiums—nonaffiliated ( 22,673 ) ( 22,673 ) ( 25,572 ) ( 25,572 ) $ 41,607 $ 43,978 $ 40,460 $ 41,508 Typical insurance policies written or assumed have a maximum coverage of $ 0.4 million per claim, of which we cede $ 0.15 million of the risk of loss per reinsurance. Therefore, our risk of loss is limited to $ 0.25 million per claim on typical policies, subject to the reinsurers meeting their obligations. After this limit, amounts are recoverable through reinsurance for catastrophic losses in excess of $ 4.0 million per occurrence, up to a maximum of $ 90 million in the aggregate for that occurrence. The following details the activity in the incurred but not reported reserve for the three and nine months ended December 27, 2025 a nd December 28, 2024 (in thousands): Three Months Ended Nine Months Ended December 27, 2025 December 28, 2024 December 27, 2025 December 28, 2024 Balance at beginning of period $ 10,260 $ 14,620 $ 16,201 $ 10,540 Net incurred losses during the period 6,578 9,662 25,463 41,753 Net claim payments during the period ( 5,909 ) ( 12,028 ) ( 30,735 ) ( 40,039 ) Balance at end of period $ 10,929 $ 12,254 $ 10,929 $ 12,254 15. Commitments and Contingencies Repurchase Contingencies . The maximum amount for which the Company was liable under the terms of repurchase agreements with financial institutions that provide inventory financing to independent distributors of our products approxim ated $ 148 million and $ 133 million at December 27, 2025 and March 29, 2025, respectively, without reduction for the estimated resale value of the home s. Our reserve for repurchase commitments, re corded in Accrued expenses and other current liabilities, was $ 3.7 million at December 27, 2025 and $ 3.3 million at March 29, 2025. Construction-Period Mortgages. Loan contracts with off-balance sheet commitments are summarized below (in thousands): 12 Table of Contents December 27, 2025 March 29, 2025 Construction loan contract amount $ 6,034 $ 12,366 Cumulative advances ( 2,811 ) ( 4,210 ) $ 3,223 $ 8,156 Representations and Warranties of Mortgages Sold . The reserve for contingent repurchases and indemnification obliga tions was $ 0.6 million as of December 27, 2025 and March 29, 2025, included in Accrued expenses and other current liabilities on the Consolidated Balance Sheets. There were no claim requests that resulted in the repurchase of any loans during the nine months ended December 27, 2025 or December 28, 2024 . Interest Rate Lock Commitments ("IRLCs") . As of December 27, 2025 and March 29, 2025, w e had outstanding IRLCs with a notional amount of $ 36.0 million and $ 16.3 million, respectively. For the three and nine months ended December 27, 2025 , we recognized insignificant non-cash gains on outstanding IRLCs. For the three and nine months ended December 28, 2024, we recognized insignificant non-cash losses and gains, respectively, on outstanding IRLCs. Forward Sales Commitments. As of December 27, 2025 and March 29, 2025, we had $ 10.6 million and $ 20.8 million in outstanding forward sales commitments for sales of mortgage backed securities and whole loan commitments (collectively, the "Commitments"), respectively. During the three and nine months ended December 27, 2025, we recognized insignificant non-cash gains on Commitments. During the three and nine months ended December 28, 2024, we recognized insignificant non-cash gains. Legal Matters. We are party to certain lawsuits in the ordinary course of business. Based on management's present knowledge of the facts and (in certain cases) advice of outside counsel, management does not believe that loss contingencies arising from pending matters are likely to have a material adverse effect on our consolidated financial position, liquidity or results of operations after taking into account any existing reserves, which reserves are included in Accrued expenses and other current liabilities on the Consolidated Balance Sheets. However, future events or circumstances that may currently be unknown to management will determine whether the resolution of pending or threatened litigation or claims will ultimately have a material effect on our consolidated financial position, liquidity or results of operations in any future reporting periods. 13 Table of Contents 16. Stockholders' Equity The following tables represent changes in Stockholders' equity during the nine months ended December 27, 2025 and December 28, 2024, respectively (dollars in thousands): Treasury stock Additional paid-in capital Retained earnings Accumulated other comprehensive income Total Common Stock Shares Amount Balance, March 29, 2025 9,436,732 $ 94 $ ( 424,624 ) $ 290,940 $ 1,198,163 $ 9 $ 1,064,582 Net income — — — — 51,642 — 51,642 Other comprehensive income, net — — — — — 96 96 Net issuance of common stock under stock incentive plans 16,631 1 — ( 4,682 ) — — ( 4,681 ) Stock-based compensation — — — 3,563 — — 3,563 Common stock repurchases — — ( 50,369 ) — — — ( 50,369 ) Balance, June 28, 2025 9,453,363 $ 95 $ ( 474,993 ) $ 289,821 $ 1,249,805 $ 105 $ 1,064,833 Net income — — — — 52,381 — 52,381 Other comprehensive income, net — — — — — 114 114 Net issuance of common stock under stock incentive plans 17,457 — — 1,633 — — 1,633 Stock-based compensation — — — 3,530 — — 3,530 Common stock repurchases — — ( 36,354 ) — — — ( 36,354 ) Balance, September 27, 2025 9,470,820 $ 95 $ ( 511,347 ) $ 294,984 $ 1,302,186 $ 219 $ 1,086,137 Net income — — — — 44,067 — 44,067 Other comprehensive income, net — — — — — 8 8 Net issuance of common stock under stock incentive plans 469 — — 75 — — 75 Stock-based compensation — — — 3,172 — — 3,172 Common stock repurchases — — ( 44,240 ) — — — ( 44,240 ) Balance, December 27, 2025 9,471,289 $ 95 $ ( 555,587 ) $ 298,231 $ 1,346,253 $ 227 $ 1,089,219 14 Table of Contents Treasury stock Additional paid-in capital Retained earnings Accumulated other comprehensive (loss) income Total Common Stock Shares Amount Balance, March 30, 2024 9,389,953 $ 94 $ ( 274,693 ) $ 281,216 $ 1,027,127 $ ( 333 ) $ 1,033,411 Net income — — — — 34,429 — 34,429 Other comprehensive income, net — — — — — 58 58 Net issuance of common stock under stock incentive plans 11,104 — — ( 2,348 ) — — ( 2,348 ) Stock-based compensation — — — 2,194 — — 2,194 Common stock repurchases — — ( 29,204 ) — — — ( 29,204 ) Balance, June 29, 2024 9,401,057 $ 94 $ ( 303,897 ) $ 281,062 $ 1,061,556 $ ( 275 ) $ 1,038,540 Net income — — — — 43,815 — 43,815 Other comprehensive income, net — — — — — 198 198 Net issuance of common stock under stock incentive plans 16,275 — — 1,220 — — 1,220 Stock-based compensation — — — 2,713 — — 2,713 Common stock repurchases — — ( 44,509 ) — — — ( 44,509 ) Balance, September 28, 2024 9,417,332 $ 94 $ ( 348,406 ) $ 284,995 $ 1,105,371 $ ( 77 ) $ 1,041,977 Net income — — — — 56,462 — 56,462 Other comprehensive (loss), net — — — — — ( 70 ) ( 70 ) Net issuance of common stock under stock incentive plans 5,637 — — ( 168 ) — — ( 168 ) Stock-based compensation — — — 1,746 — — 1,746 Common stock repurchases — — ( 42,722 ) — — — ( 42,722 ) Balance, December 28, 2024 9,422,969 $ 94 $ ( 391,128 ) $ 286,573 $ 1,161,833 $ ( 147 ) $ 1,057,225 17. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share (dollars in thousands, except per share amounts): Three Months Ended Nine Months Ended December 27, 2025 December 28, 2024 December 27, 2025 December 28, 2024 Net income $ 44,067 $ 56,462 $ 148,090 $ 134,706 Weighted average shares outstanding Basic 7,801,698 8,096,538 7,887,594 8,203,448 Effect of dilutive securities 89,395 90,276 94,015 88,199 Diluted 7,891,093 8,186,814 7,981,609 8,291,647 Net income per share Basic $ 5.65 $ 6.97 $ 18.78 $ 16.42 Diluted $ 5.58 $ 6.90 $ 18.55 $ 16.25 Anti-dilutive common stock equivalents excluded 2 — 1 169 15 Table of Contents 18. Fair Value Measurements The book value and estimated fair value of our financial instruments were as follows (in thousands): December 27, 2025 March 29, 2025 Book Value Estimated Fair Value Book Value Estimated Fair Value Available-for-sale debt securities $ 22,908 $ 22,908 $ 21,415 $ 21,415 Marketable equity securities 13,499 13,499 11,425 11,425 Non-marketable equity investments 5,652 5,652 5,069 5,069 Consumer loans receivable 58,783 58,938 56,537 59,365 Commercial loans receivable 106,230 99,776 99,746 89,216 Other secured financing ( 1,476 ) ( 1,474 ) ( 1,594 ) ( 1,569 ) See Note 20, Fair Value Measurements, and the Fair Value of Financial Instruments caption in Note 1, Summary of Significant Accounting Policies, in the Form 10-K for more information on the methodologies we use in determining fair value. Mortgage Servicing . Mortgage Servicing Rights ("MSRs") are recorded at fair value in Prepaid expenses and other current assets on the Consolidated Balance Sheets. December 27, 2025 March 29, 2025 Number of loans serviced with MSRs 3,517 3,647 Weighted average servicing fee (basis points) 34.01 34.74 Capitalized servicing multiple 173.01 % 179.97 % Capitalized servicing rate (basis points) 58.84 62.52 Serviced portfolio with MSRs (in thousands) $ 435,646 $ 451,080 MSRs (in thousands) $ 2,564 $ 2,820 19. Acquisition American Homestar Acquisition On September 29, 2025 (the "Acquisition Date"), we completed the acquisition of American Homestar, including their two manufacturing facilities and 19 retail locations, by acquiring 100 % of the outstanding stock for total consideration of $ 179.9 million, which is subject to customary adjustments. The total consideration transferred was $ 181.4 million in cash, $ 3.4 million in a liability to be paid in cash and contingent consideration to be received from the seller pending the outcome of future matters is fair valued at $ 4.8 million. The range of possible outcomes is $ 0 million to $ 4.8 million. This purchase enhances our position in the South Central U.S. while adding coverage and scale with high quality products. We believe this purchase will have a positive financial impact with accretive earnings and cash flow and meaningful improvement opportunities including cost, purchasing and product optimization synergies. We have expensed $ 5.0 million in acquisition related transaction costs in Selling, general and administrative expenses in the Consolidated Statements of Comprehensive Income and have not incurred debt in connection with the purchase or subsequent operations. The following table presents the fair values of the assets that we acquired and the liabilities that we assumed as of the Acquisition Date (in thousands). The purchase accounting is provisional and c ertain estimated fair values for leases, Other current assets, Accounts payable and accrued expenses and Deferred tax liability are not yet finalized and are subject to change, which could be significant. We will finalize the amounts recognized as we obtain the information necessary to complete the analysis. We expect to finalize these amounts as soon as possible but no later than one year from the Acquisition Date. 16 Table of Contents September 29, 2025 Cash $ 8,484 Accounts receivable 5,310 Inventories 47,855 Other current assets 2,574 Property, plant and equipment 37,160 Consumer loans receivable 1,870 Operating lease right-of-use asset 2,952 Intangible assets (1) 13,300 Total identifiable assets acquired 119,505 Accounts payable and accrued liabilities 16,757 Operating lease liability 2,952 Deferred tax liability 5,700 Net identifiable assets acquired 94,096 Goodwill (2) 85,834 Net assets acquired $ 179,930 (1) Consists of $ 13.3 million assigned to customer-related intangibles, subject to a useful life of 14 years amortized on a straight-line basis. (2) Attributable to the Factory-built housing segment and not deductible for income tax purposes. Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in business combinations. The goodwill recognized is attributable primarily to the expected synergies in purchasing and product distribution optimization from combining operations, the assembled workforce in one of the most important manufactured housing markets in the U.S., and more broadly the added capacity and distribution needed to meet growing housing needs. Since the Acquisition Date, American Homestar has contributed Net revenue of $ 42.0 million and Net income of $ 2.4 million for the three months ended December 27, 2025. Pro Forma Impact of American Homestar Acquisition (Unaudited) . The following table presents supplemental pro forma information as if the American Homestar acquisition had occurred on March 31, 2024 (in thousands, except per share data): December 27, 2025 December 28, 2024 Nine Months Ended Three Months Ended Nine Months Ended Net revenue $ 1,794,651 $ 574,938 $ 1,647,449 Net income 154,373 59,939 144,770 Diluted net income per share 19.34 7.32 17.46 17 Table of Contents 20. Business Segment Information We operate principally in two segments: (1) Factory-built housing, which includes wholesale and retail Factory-built housing operations and (2) Financial services, which includes manufactured housing consumer finance and insurance, and qualifies as other activity under the segment reporting guidance as it does not meet the quantitative thresholds to be reported separately. The Factory-built housing segment generates revenue from building and selling manufactured and modular homes to both wholesale customers and end consumers through Company owned retail stores. The Financial services segment generates revenue through lending products for manufactured home purchasers, and through writing and holding insurance policies for manufactured homes. The Company's Chief Executive Officer is the chief operating decision maker ("CODM"). The CODM assesses segment performance and allocates resources, including reinvesting profits and making acquisitions, based on Gross p rofit and Income before income taxes. The CODM also uses these metrics in the budgeting process when determining how to allocate resources. The CODM is not provided asset information by reportable segment. The following tables provide selected financial data by segment (dollars in thousands): Three Months Ended December 27, 2025 Factory-built housing Financial services Consolidated Net revenue $ 558,497 $ 22,497 $ 580,994 Cost of sales 437,242 7,831 445,073 Gross profit 121,255 14,666 135,921 Selling, general and administrative expenses 74,162 7,199 81,361 Income from operations 47,093 7,467 54,560 Interest income 2,956 — 2,956 Interest expense ( 131 ) — ( 131 ) Other income, net 213 — 213 Income before income taxes 50,131 7,467 57,598 Income tax expense ( 11,981 ) ( 1,550 ) ( 13,531 ) Net income $ 38,150 $ 5,917 $ 44,067 Nine Months Ended December 27, 2025 Factory-built housing Financial services Consolidated Net revenue $ 1,629,308 $ 65,070 $ 1,694,378 Cost of sales 1,264,715 29,829 1,294,544 Gross profit 364,593 35,241 399,834 Selling, general and administrative expenses 203,073 19,665 222,738 Income from operations 161,520 15,576 177,096 Interest income 13,105 — 13,105 Interest expense ( 407 ) — ( 407 ) Other income, net 355 — 355 Income before income taxes 174,573 15,576 190,149 Income tax expense ( 38,770 ) ( 3,289 ) ( 42,059 ) Net income $ 135,803 $ 12,287 $ 148,090 18 Table of Contents Three Months Ended December 27, 2025 Factory-built housing Financial services Consolidated Depreciation $ 5,497 $ 55 $ 5,552 Amortization $ 602 $ 7 $ 609 Capital expenditures $ 8,448 $ 42 $ 8,490 Nine Months Ended December 27, 2025 Factory-built housing Financial services Consolidated Depreciation $ 15,130 $ 180 $ 15,310 Amortization $ 1,334 $ 19 $ 1,353 Capital expenditures $ 27,318 $ 42 $ 27,360 19 Table of Contents Three Months Ended December 28, 2024 Factory-built housing Financial services Consolidated Net revenue $ 500,860 $ 21,180 $ 522,040 Cost of sales 382,667 9,423 392,090 Gross profit 118,193 11,757 129,950 Selling, general and administrative expenses 60,408 5,572 65,980 Income from operations 57,785 6,185 63,970 Interest income 5,353 — 5,353 Interest expense ( 155 ) — ( 155 ) Other income, net 168 — 168 Income before income taxes 63,151 6,185 69,336 Income tax expense ( 11,715 ) ( 1,159 ) ( 12,874 ) Net income $ 51,436 $ 5,026 $ 56,462 Nine Months Ended December 28, 2024 Factory-built housing Financial services Consolidated Net revenue $ 1,445,251 $ 61,849 $ 1,507,100 Cost of sales 1,112,029 45,597 1,157,626 Gross profit 333,222 16,252 349,474 Selling, general and administrative expenses 181,569 16,259 197,828 Income (loss) from operations 151,653 ( 7 ) 151,646 Interest income 16,556 — 16,556 Interest expense ( 370 ) — ( 370 ) Other income, net 315 — 315 Income (loss) before income taxes 168,154 ( 7 ) 168,147 Income tax (expense) benefit ( 33,470 ) 29 ( 33,441 ) Net income $ 134,684 $ 22 $ 134,706 Three Months Ended December 28, 2024 Factory-built housing Financial services Consolidated Depreciation $ 4,344 $ 63 $ 4,407 Amortization $ 370 $ 7 $ 377 Capital expenditures $ 5,434 $ — $ 5,434 Nine Months Ended December 28, 2024 Factory-built housing Financial services Consolidated Depreciation $ 12,960 $ 191 $ 13,151 Amortization $ 1,135 $ 19 $ 1,154 Capital expenditures $ 15,163 $ 90 $ 15,253 20 Table of Contents December 27, 2025 March 29, 2025 Total assets: Factory-built housing $ 1,228,925 $ 1,191,216 Financial services 243,270 215,429 Consolidated $ 1,472,195 $ 1,406,645 21 Table of Contents