What changed in this filing

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Item 1. Financial Statements

2022-11-01 compared with 2022-08-02 · 98 added, 66 removed, 373 unchanged (31% of the section changed)

3 unchanged sentences

(In thousands, except share data)

June 30, December 31,

September 30, December 31,

Cash and cash equivalents $ 52,660 $ 50,514

13 unchanged sentences

COMMITMENTS AND CONTINGENCIES

Common stock, par value $ 0.01 , 250,000,000 shares authorized, 27,212,108 shares issued and 23,272,636 shares outstanding as of June 30, 2022 and 26,963,915 shares issued and 23,917,359 shares outstanding as of December 31, 2021

Common stock, par value $ 0.01 , 250,000,000 shares authorized, 27,229,758 shares issued and 23,290,286 shares outstanding as of September 30, 2022 and 26,963,915 shares issued and 23,917,359 shares outstanding as of December 31, 2021

Additional paid-in capital 305,357 291,577

8 unchanged sentences

(In thousands, except share and per share data)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

33 unchanged sentences

BALANCE— June 30, 2022 27,212,108 $ 271 $ 302,688 $ 1,565,984 $ ( 355,022 ) $ 1,513,921

Net income — — — 90,390 — 90,390

Compensation expense for equity awards — — 1,516 — — 1,516

Stock issued under employee incentive plans 17,650 1 1,153 — — 1,154

BALANCE— September 30, 2022 27,229,758 $ 272 $ 305,357 $ 1,656,374 $ ( 355,022 ) $ 1,606,981

See accompanying notes to the consolidated financial statements.

16 unchanged sentences

BALANCE— June 30, 2021 26,926,693 $ 269 $ 281,808 $ 1,152,069 $ ( 147,740 ) $ 1,286,406

Net income — — — 100,550 — 100,550

Stock repurchase — — — — ( 56,083 ) ( 56,083 )

Compensation expense for equity awards — — 3,352 — — 3,352

Stock issued under employee incentive plans 14,529 — 1,549 — — 1,549

BALANCE— September 30, 2021 26,941,222 $ 269 $ 286,709 $ 1,252,619 $ ( 203,823 ) $ 1,335,774

See accompanying notes to the consolidated financial statements.

2 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

5 unchanged sentences

Loss on extinguishment of debt — 13,976

(Gain) loss on disposal of assets ( 1,564 ) 350

Gain on sale of interest rate cap ( 7,055 ) —

Gain on disposal of assets ( 2,206 ) ( 880 )

Compensation expense for equity awards 8,631 10,169

17 unchanged sentences

Payments on notes payable ( 110,000 ) ( 944,000 )

Proceeds from financing arrangements 35,858 —

Payments on financing arrangements ( 4,119 ) —

Redemption premium — ( 10,314 )

Loan issuance costs ( 2,567 ) ( 10,572 )

2 unchanged sentences

Net cash provided by (used in) financing activities 363,804 ( 20,483 )

Net increase (decrease) in cash and cash equivalents ( 8,543 ) 75,762

Net increase in cash and cash equivalents 2,146 10,775

Cash and cash equivalents, beginning of period 50,514 35,942

13 unchanged sentences

Results for interim periods are not necessarily indicative of results to be expected for the full year.

The accompanying unaudited financial statements as of June 30, 2022, and for the three and six months ended June 30, 2022 and 2021, include the accounts of the Company and its subsidiaries.

The accompanying unaudited financial statements as of September 30, 2022, and for the three and nine months ended September 30, 2022 and 2021, include the accounts of the Company and its subsidiaries.

All intercompany balances and transactions have been eliminated in consolidation.

12 unchanged sentences

Our real estate inventory consists of the following (in thousands):

June 30, December 31,

September 30, December 31,

Land, land under development and finished lots $ 1,882,335 $ 1,499,761

2 unchanged sentences

Completed homes 377,549 107,736

Total owned inventory 2,836,042 2,085,904

Real estate not owned 35,858 —

Total real estate inventory $ 2,871,900 $ 2,085,904

11 unchanged sentences

Interest and financing costs incurred under our debt obligations, as more fully discussed in Note 4 , are capitalized to qualifying real estate projects under development and homes under construction.

During the three months ended September 30, 2022, we have entered into several land banking financing arrangements with a third-party land banker to repurchase land that we sold to the land banker as a method of acquiring finished lots in staged takedowns, while limiting risk and minimizing the use of funds from our available cash or other financing sources.

In consideration for this repurchase option, we paid a non-refundable commitment fee.

Based on our right to control the ultimate economic outcome of these finished lots, these assets will continue to be held within our inventory and a corresponding obligation was established within our accrued liabilities as more fully discussed in Note 3 to recognize this relationship.

While we are not legally obligated to purchase the balance of the lots, we will be subject to certain performance obligations, financial and other penalties if the lots are not purchased.

We do not have any ownership interest or title to the assets of the land banker and do not guarantee their liabilities.

ACCRUED EXPENSES AND OTHER LIABILITIES

Accrued and other liabilities consist of the following (in thousands):

June 30, December 31,

September 30, December 31,

Real estate inventory development and construction payable $ 68,881 $ 48,656

Land banking financing arrangements 35,858 —

Accrued compensation, bonuses and benefits 11,792 24,914

1 unchanged sentence

Contract deposits 12,012 12,182

Accrued interest 8,063 7,431

Inventory related obligations 13,283 8,803

Warranty reserve 10,050 7,850

Accrued interest 6,924 7,431

Lease liability 5,402 5,333

1 unchanged sentence

Total accrued expenses and other liabilities $ 220,476 $ 136,609

Land Banking Financing Arrangements

We have entered into several land banking financing arrangements with a third-party land banker to repurchase land that we sold to the land banker as a method of acquiring finished lots in staged takedowns.

Principal payments on these financing arrangements will generally coincide with the repurchase of lot takedowns from the land banker.

We expect to complete the repurchase of all lots via takedowns associated with these transactions over the course of approximately two years.

Inventory Related Obligations

5 unchanged sentences

Changes to our warranty accrual are as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

13 unchanged sentences

The borrowing base primarily consists of a percentage of commercial land, land held for development, lots under development and finished lots held by the Company and its subsidiaries that guarantee the obligations under the Credit Agreement.

As of June 30, 2022, the borrowing base under the Credit Agreement was $ 1.4 billion, of which borrowings, including the 2029 Senior Notes, of $ 1.2 billion were outstanding, $ 26.9 million of letters of credit were outstanding and $ 203.7 million was available to borrow under the Credit Agreement.

As of September 30, 2022, the borrowing base under the Credit Agreement was $ 1.4 billion, of which borrowings, including the 2029 Senior Notes, of $ 1.2 billion were outstanding, $ 29.8 million of letters of credit were outstanding and $ 127.3 million was available to borrow under the Credit Agreement.

Interest is paid monthly on borrowings under the Credit Agreement at SOFR plus 1.85 %.

The Credit Agreement applicable margin for SOFR loans ranges from 1.45 % to 2.10 % based on our leverage ratio.

At June 30, 2022, SOFR was 1.50 %, subject to the 0.50 % SOFR floor as included in the Credit Agreement.

At September 30, 2022, SOFR was 3.03 %, subject to the 0.50 % SOFR floor as included in the Credit Agreement.

The Credit Agreement contains various financial covenants, including a minimum tangible net worth, a leverage ratio, a minimum liquidity amount and an EBITDA to interest expense ratio.

The Credit Agreement contains various covenants that, among other restrictions, limit the amount of our additional debt and our ability to make certain investments.

At June 30, 2022, we were in compliance with all of the covenants contained in the Credit Agreement.

At September 30, 2022, we were in compliance with all of the covenants contained in the Credit Agreement.

Senior Notes Offering

5 unchanged sentences

Notes payable consist of the following (in thousands):

June 30, 2022 December 31, 2021

Notes payable under the Credit Agreement ($ 1.1 billion revolving credit facility at June 30, 2022) maturing on April 28, 2025;

September 30, 2022 December 31, 2021

Notes payable under the Credit Agreement ($ 1.1 billion revolving credit facility at September 30, 2022) maturing on April 28, 2025;

interest paid monthly at SOFR plus 1.85 %.

7 unchanged sentences

Interest activity, including other financing costs, for notes payable for the periods presented is as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

3 unchanged sentences

Cash paid for interest $ 14,874 $ 11,772 $ 29,080 $ 26,264

Included in interest incurred was amortization of deferred financing costs and discounts for notes payable of $ 0.9 million and $ 0.7 million for each of the three months ended June 30, 2022 and 2021, respectively, and $ 1.6 million and $ 1.4 million for each of the six months ended June 30, 2022 and 2021, respectively.

Included in interest incurred was amortization of deferred financing costs and discounts for notes payable of $ 0.9 million and $ 0.8 million for the three months ended September 30, 2022 and 2021, respectively, and $ 2.5 million and $ 2.2 million for the nine months ended September 30, 2022 and 2021, respectively.

and state income tax returns in jurisdictions with varying statutes of limitations.

4 unchanged sentences

however, audit outcomes and the timing of audit adjustments are subject to significant uncertainty.

For the three months ended June 30, 2022, our effective tax rate of 24.3 % is higher than the Federal statutory rate primarily as a result of an increase in the rate for the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended, and for state income taxes, net of the federal benefit.

For the six months ended June 30, 2022, our effective rate of 23.1 % is higher than the Federal statutory rate primarily as a result of an increase in the rate for the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended, and for state income taxes, net of the federal benefit, offset by the deductions in excess of compensation cost for share-based payments.

Income taxes paid were $ 52.0 million and $ 63.5 million for the three months ended June 30, 2022 and 2021, respectively.

Income taxes paid were $ 52.4 million and $ 63.7 million for the six months ended June 30, 2022 and 2021, respectively.

For the three months ended September 30, 2022, our effective tax rate of 16.8 % is lower than the Federal statutory rate primarily as a result of the retroactive extension of the 45L tax credit and the deductions in excess of compensation cost for share-based payments, offset by an increase in the rate for the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended, and for state income taxes, net of the federal benefit.

For the nine months ended September 30, 2022, our effective rate of 21.2 % is slightly higher than the Federal statutory rate primarily as a result of an increase in the rate for the state income taxes, net of the federal benefit, and the compensation limitation under Section 162(m) of the Internal Revenue Code, as amended, offset by the retroactive extension of the 45L tax credit and the deductions in excess of compensation cost for share-based payments.

Income taxes paid were $ 3.8 million and $ 36.0 million for the three months ended September 30, 2022 and 2021, respectively.

Income taxes paid were $ 56.2 million and $ 99.7 million for the nine months ended September 30, 2022 and 2021, respectively.

Stock Repurchase Program

In February 2022, our Board of Directors (the “Board”) approved a $ 200.0 million increase to our previously authorized stock repurchase program, pursuant to which we may purchase up to $ 550.0 million of shares of our common stock through open market transactions, privately negotiated transactions or otherwise in accordance with applicable laws.

During the three months ended June 30, 2022, we repurchased 417,861 shares of our common stock for $ 37.4 million to be held as treasury stock.

During the six months ended June 30, 2022, we repurchased 892,916 shares of our common stock for $ 95.1 million to be held as treasury stock.

During the three months ended June 30, 2021, we repurchased 335,000 shares of our common stock for $ 55.8 million to be held as treasury stock.

During the six months ended June 30, 2021, we repurchased 551,221 shares of our common stock for $ 81.6 million to be held as treasury stock.

During the three months ended September 30, 2022, we did no t repurchase any shares of our common stock.

During the nine months ended September 30, 2022, we repurchased 892,916 shares of our common stock for $ 95.1 million to be held as treasury stock.

During the three months ended September 30, 2021, we repurchased 358,817 shares of our common stock for $ 56.1 million to be held as treasury stock.

During the nine months ended September 30, 2021, we repurchased 910,038 shares of our common stock for $ 137.7 million to be held as treasury stock.

A total of 2,939,472 shares of our common stock has been repurchased since our stock repurchase program commenced.

As of June 30, 2022, we may purchase up to $ 211.5 million of shares of our common stock under our stock repurchase program.

As of September 30, 2022, we may purchase up to $ 211.5 million of shares of our common stock under our stock repurchase program.

The timing, amount and other terms and conditions of any repurchases of shares of our common stock under our stock repurchase program will be determined by our management at its discretion based on a variety of factors, including the market price of our common stock, corporate considerations, general market and economic conditions and legal requirements.

1 unchanged sentence

EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended June 30, 2022 and 2021:

Three Months Ended June 30, Six Months Ended June 30,

The following table sets forth the computation of basic and diluted earnings per share for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

11 unchanged sentences

The following table summarizes the activity of our time-vested restricted stock units (“RSUs”):

Six Months Ended June 30,

Nine Months Ended September 30,

Shares Weighted Average Grant Date Fair Value Shares Weighted Average Grant Date Fair Value

4 unchanged sentences

Ending balance 113,087 $ 101.47 126,154 $ 77.61

We recognized $ 1.1 million and $ 0.9 million of stock-based compensation expense related to outstanding RSUs for the three months ended June 30, 2022 and 2021, respectively.

We recognized $ 1.9 million and $ 1.7 million of stock-based compensation expense related to outstanding RSUs for the six months ended June 30, 2022 and 2021, respectively.

We recognized $ 0.9 million and $ 0.8 million of stock-based compensation expense related to outstanding RSUs for the three months ended September 30, 2022 and 2021, respectively.

We recognized $ 2.8 million and $ 2.5 million of stock-based compensation expense related to outstanding RSUs for the nine months ended September 30, 2022 and 2021, respectively.

Generally, the RSUs cliff vest on the third anniversary of the grant date and can only be settled in shares of our common stock.

At June 30, 2022, we had unrecognized compensation cost of $ 6.4 million related to unvested RSUs, which is expected to be recognized over a weighted average period of 2.1 years.

At September 30, 2022, we had unrecognized compensation cost of $ 5.4 million related to unvested RSUs, which is expected to be recognized over a weighted average period of 1.9 years.

Performance-Based Restricted Stock Units

8 unchanged sentences

The PSUs can only be settled in shares of our common stock.

The following table summarizes the activity of our PSUs for the six months ended June 30, 2022:

Period Granted Performance Period Target PSUs Outstanding at December 31, 2021 Target PSUs Granted Target PSUs Forfeited Target PSUs Vested Target PSUs Outstanding at June 30, 2022 Weighted Average Grant Date Fair Value

The following table summarizes the activity of our PSUs for the nine months ended September 30, 2022:

Period Granted Performance Period Target PSUs Outstanding at December 31, 2021 Target PSUs Granted Target PSUs Forfeited Target PSUs Vested Target PSUs Outstanding at September 30, 2022 Weighted Average Grant Date Fair Value

2019 2019 - 2021 81,242 — ( 767 ) ( 80,475 ) — $ 56.49

3 unchanged sentences

Total 215,807 66,909 ( 2,261 ) ( 80,475 ) 199,980

At June 30, 2022, management estimates that the recipients will receive approximately 100 %, 200 % and 200 % of the 2022, 2021 and 2020 target number of PSUs, respectively, at the end of the applicable three-year performance cycle based on projected performance compared to the target performance metrics.

We recognized $ 2.2 million of total stock-based compensation expense related to outstanding PSUs for each of the three months ended June 30, 2022 and 2021.

We recognized $ 4.5 million and $ 4.4 million of total stock-based compensation expense related to outstanding PSUs for the six months ended June 30, 2022 and 2021, respectively.

The 2019 - 2021 performance period PSUs vested and issued on March 15, 2022 at 200 %

of the target number.

At June 30, 2022, we had unrecognized compensation cost of $ 15.4 million, based on the probable amount, related to unvested PSUs, which is expected to be recognized over a weighted average period of 2.1 years.

At September 30, 2022, management estimates that the recipients will receive approximately 50 %, 153 % and 200 % of the 2022, 2021 and 2020 target number of PSUs, respectively, at the end of the applicable three-year performance cycle based on projected performance compared to the target performance metrics.

We recognized $ 0.4 million and $ 2.3 million of total stock-based compensation expense related to outstanding PSUs for the three months ended September 30, 2022 and 2021, respectively.

We recognized $ 4.9 million and $ 6.7 million of total stock-based compensation expense related to outstanding PSUs for the nine months ended September 30, 2022 and 2021, respectively.

The 2019 - 2021 performance period PSUs vested and issued on March 15, 2022 at 200 % of the target number.

At September 30, 2022, we had unrecognized compensation cost

of $ 9.0 million, based on the probable amount, related to unvested PSUs, which is expected to be recognized over a weighted average period of 1.7 years.

FAIR VALUE DISCLOSURES

12 unchanged sentences

The fair value of financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and certain accrued liabilities approximate their carrying amounts due to the short-term nature of these instruments.

As of June 30, 2022, the Credit Agreement’s carrying value approximates market value since it has a floating interest rate, which increases or decreases with market interest rates and our leverage ratio.

As of September 30, 2022, the Credit Agreement’s carrying value approximates market value since it has a floating interest rate, which increases or decreases with market interest rates and our leverage ratio.

In order to determine the fair value of the 2029 Senior Notes, the future contractual cash flows are discounted at our estimate of current market rates of interest, which were determined based upon the average interest rates of similar senior notes within the homebuilding industry (Level 2 measurement).

The following table below shows the level and measurement of liabilities at June 30, 2022 and December 31, 2021 (in thousands):

June 30, 2022 December 31, 2021

The following table below shows the level and measurement of liabilities at September 30, 2022 and December 31, 2021 (in thousands):

September 30, 2022 December 31, 2021

Fair Value Hierarchy Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value

4 unchanged sentences

Land Purchases from Affiliates

We did not enter into or complete any land purchase contracts with affiliates during the six months ended June 30, 2022.

During the three months ended June 30, 2021, we completed a land purchase contract to purchase a total of 25 finished lots in Burnet County, Texas from an affiliate of a family member of our chief executive officer for a total base purchase price of approximately $ 2.5 million and a land purchase contract to purchase a total of 110 finished lots in Pasco County, Florida from an affiliate of one of our directors for a total base purchase price of approximately $ 4.0 million.

We did not enter into or complete any land purchase contracts with affiliates during the nine months ended September 30, 2022.

During the nine months ended September 30, 2021, we completed a land purchase contract to purchase a total of 25 finished lots in Burnet County, Texas from an affiliate of a family member of our chief executive officer for a total base purchase price of approximately $ 2.5 million.

Also during the nine months ended September 30, 2021, we completed a land purchase contract to purchase a total of 110 finished lots in Pasco County, Florida from an affiliate of one of our directors for a total base purchase price of approximately $ 4.0 million.

COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

In the ordinary course of doing business, we are subject to claims or proceedings from time to time relating to the purchase, development and sale of real estate and homes and other aspects of our homebuilding operations.

Management believes that these claims include usual obligations incurred by real estate developers and residential home builders in the normal course of business.

Management believes that these claims include usual obligations incurred by real estate developers and residential home builders in the

normal course of business.

In the opinion of management, these matters will not have a material effect on our consolidated financial position, results of operations or cash flows.

10 unchanged sentences

The following is a summary of our land purchase deposits included in pre-acquisition costs and deposits (in thousands, except for lot count):

June 30, 2022 December 31, 2021

September 30, 2022 December 31, 2021

Land deposits and option payments (1)

$ 32,266 $ 37,499

Commitments under the land purchase contracts if the purchases are consummated (1)

$ 433,934 $ 921,345

Lots under land purchase contracts (1)

As of June 30, 2022 and December 31, 2021, approximately $ 16.6 million and $ 19.3 million, respectively, of the land deposits are related to purchase contracts to deliver finished lots that are refundable under certain circumstances, such as feasibility or specific performance, and secured by mortgages or letters of credit or guaranteed by the seller or its affiliates.

15,826 36,978

(1) Includes land banking financing arrangements, see Notes 2 and 3 for more details regarding real estate not owned.

As of September 30, 2022 and December 31, 2021, approximately $ 16.6 million and $ 19.3 million, respectively, of the land deposits are related to purchase contracts to deliver finished lots that are refundable under certain circumstances, such as feasibility or specific performance, and secured by mortgages or letters of credit or guaranteed by the seller or its affiliates.

Lease Obligations

7 unchanged sentences

As our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

ROU assets, as included in other assets on the consolidated balance sheets, were $ 5.0 million and $ 5.1 million at June 30, 2022 and December 31, 2021, respectively.

Lease obligations, as included in accrued expenses and other liabilities on the consolidated balance sheets, were $ 5.2 million and $ 5.3 million at June 30, 2022 and December 31, 2021, respectively.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 0.5 million and $ 0.4 million for the three months ended June 30, 2022 and 2021, respectively.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 1.0 million and $ 0.8 million for the six months ended June 30, 2022 and 2021, respectively.

Cash paid for amounts included in the measurement of lease liabilities for operating leases during the six months ended June 30, 2022 and 2021 was $ 0.9 million and $ 0.8 million, respectively.

As of June 30, 2022, the weighted-average discount rate was 5.2 % and our weighted-average remaining life was 2.8 years.

We do not have any significant lease contracts that have not yet commenced at June 30, 2022.

The table below shows the future minimum payments under non-cancelable operating leases at June 30, 2022 (in thousands):

ROU assets, as included in other assets on the consolidated balance sheets, were $ 5.0 million and $ 5.1 million at September 30, 2022 and December 31, 2021, respectively.

Lease obligations, as included in accrued expenses and other liabilities on the consolidated balance sheets, were $ 5.4 million and $ 5.3 million at September 30, 2022 and December 31, 2021, respectively.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 0.5 million for each of the three months ended September 30, 2022 and 2021.

Operating lease cost, as included in general and administrative expense in our consolidated statements of operations, was $ 1.6 million and $ 1.3 million for the nine months ended September 30, 2022 and 2021, respectively.

Cash paid for amounts included in the measurement of lease liabilities for operating leases during the nine months ended September 30, 2022 and 2021 was $ 1.3 million and $ 1.2 million, respectively.

As of September 30, 2022, the weighted-average discount rate was 5.3 % and our weighted-average remaining life was 3.0 years.

We do not have any significant lease contracts that have not yet commenced at September 30, 2022.

The table below shows the future minimum payments under non-cancelable operating leases at September 30, 2022 (in thousands):

Year Ending December 31, Operating leases

3 unchanged sentences

Bonding and Letters of Credit

We have outstanding letters of credit and performance and surety bonds totaling $ 284.6 million (including $ 26.9 million of letters of credit issued under the Credit Agreement) and $ 206.8 million at June 30, 2022 and December 31, 2021, respectively, related to our obligations for site improvements at various projects.

We have outstanding letters of credit and performance and surety bonds totaling $ 338.7 million (including $ 29.8 million of letters of credit issued under the Credit Agreement) and $ 206.8 million at September 30, 2022 and December 31, 2021, respectively, related to our obligations for site improvements at various projects.

Management does not believe that draws upon the letters of credit, surety bonds or financial guarantees if any, will have a material effect on our consolidated financial position, results of operations or cash flows.

3 unchanged sentences

Additionally, in 2021, we entered into a joint venture with a mortgage lender.

As of June 30, 2022 and December 31, 2021, we have a total of $ 7.1 million and $ 5.6 million, respectively, within other assets on the balance sheet relating to our investment in this real estate investment fund and the mortgage joint venture.

As of September 30, 2022 and December 31, 2021, we have a total of $ 6.9 million and $ 5.6 million, respectively, within other assets on the balance sheet relating to our investment in this real estate investment fund and the mortgage joint venture.

Contributions into the unconsolidated entities are for the use of investing in certain real estate transactions and residential mortgage services, respectively.

Income associated with our investment in unconsolidated entities during the three and six months ended June 30, 2022, was $ 1.6 million and $ 1.8 million, respectively.

We did not have any income recognized for our investment in unconsolidated entities during each of the three and six months ended June 30, 2021.

Income associated with our investment in unconsolidated entities during the three and nine months ended September 30, 2022, was $ 2.2 million and $ 4.0 million, respectively.

We did not have any income recognized for our investment in unconsolidated entities during each of the three and nine months ended September 30, 2021.

Home Sales Revenues

1 unchanged sentence

The following table presents our home sales revenues disaggregated by revenue stream (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

7 unchanged sentences

We have seven operating segments (our Central, Midwest, Southeast, Mid-Atlantic, Northwest, West, and Florida divisions) that we aggregate into five

qualifying reportable segments at June 30, 2022:

qualifying reportable segments at September 30, 2022:

our Central, Southeast, Northwest, West, and Florida divisions.

7 unchanged sentences

Financial information relating to our reportable segments was as follows (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 2022 2021

14 unchanged sentences

Total net income before income taxes $ 108,701 $ 126,994 $ 371,263 $ 399,391

(1) The Corporate balance consists primarily of general and administration unallocated costs for various shared service functions, as well as our warranty reserve.

(1) The Corporate balance consists of general and administration unallocated costs for various shared service functions and non-strategic other income, as well as our warranty reserve.

Actual warranty expenses are reflected within the reportable segments.

June 30, 2022 December 31, 2021

Additionally, for the three and nine months ended September 30, 2022, the balance includes the $7.1 million gain on the sale of the three-year interest rate cap of LIBOR prior to its expiration.

September 30, 2022 December 31, 2021

Central $ 1,032,017 $ 857,174

8 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements