DR Horton 2Q15 Earnings Call Notes

Spring selling season is in full swing

“The spring selling season is in full swing at D.R. Horton. During the second quarter housing market conditions were healthy and relatively stable with new home demand growing moderately across all our markets.”

It’s a great market for us because we can just ride it

“That’s pretty much the market out there right now. It’s a great market for us because we’ve got the land, we’ve got the operating platform, we’ve got the people in place. So we’re not having to make any investments. We’re just riding the market. It jumps up then labor becomes a bigger issue and some of the higher price land that have been bought by others becomes competitive and we like the way deals run, it’s a good market for us, or consistent, absorptions are consistent, margins are consistent, yes, just continuing to gain market share.”

Stick and brick costs rising in line with price now

“our stick and brick cost per square foot this quarter was up about 4.5% on a year-over-year basis and that still wasn’t in line with our revenues but it’s a smaller increase than we’ve been seeing and headed in the right direction. Sequentially we actually saw our stick and brick cost increase per square foot almost essentially in line with what our price per square foot did. So we’ve made a lot of progress on that front and we plan to continue to do so as we move throughout the year.”

You would think that Texas is slowing but it’s not

” have spent the last month and a half driving our Texas markets, including Houston with the Regional President reporting and his Divisional Presidents. You would think the market would be slowing down but we are seeing consistent performance pretty much across the Board and our April sales are a continuation of what we saw in the first quarter.”