Item
2.02. Results of Operations and Financial
Condition
In
anticipation of a presentation and meetings at an upcoming institutional
investor conference, Beazer Homes USA, Inc. today provided certain unaudited
and
preliminary financial and operating data for the quarter ended December
31,
2007.
In the coming
weeks, the Company anticipates providing additional unaudited and preliminary
financial and operating data for the same period.
As
previously announced, the Company is in the process of
restat
ing
certain
prior periods’
financial statements
including
interim periods
of fiscal 2007
and 2006. As such,
comparisons of preliminary operating data for the quarter ended December
31,
2007 to the quarter ended December 31, 2006 are prior to the effect of
any
restatement and, as this data is preliminary and unaudited, is subject
to
change. The Company is working expeditiously to complete the restatements
and
report financial results for the year ended September 30, 2007 and the
quarter
ended December 31, 2007 as soon as practicable.
Home
closings for the quarter ended December 31, 2007, totaled 2,010, a 24%
decline
from the same period in the prior fiscal year. This resulted in a
backlog conversion ratio of 67%, as the Company remained focused on converting
its existing backlog for cash generation. Net new home orders totaled 1,260,
a
decline of 29% from the prior fiscal year. At 46%, the cancellation
rate for the quarter was comparable to the 43% rate experienced in the
prior
year and significantly improved from the unusually high rate of 68% in
the
fourth quarter of fiscal 2007.
At
December 31, 2007, the Company had a cash balance in excess of $325.0 million,
compared to $155.0 million at December 31, 2006 and $459.5 million at September
30, 2007. As previously reported, during the quarter, the Company
repaid approximately $75 million in secured debt, and paid a consent fee
to
holders of its Senior Notes and Senior Convertible Notes and related expenses
totaling $21 million.
The
cash
balance at December 31, 2007
includes approximately $92 million of
restricted cash pledged to collateralize its outstanding letters of
credit. The Company is continuing the process of replacing this cash
with real property in the collateral pool under its secured revolving credit
facility. Due to seasonal patterns, the Company generally experiences
a net use of cash in its first fiscal quarter, as was the case this year,
although the Company continues to expect that for the whole of fiscal 2008,
it
will generate cash from operations.