• Revenue (Q4 2024): $134.8 million, up from $116.8 million in Q4 2023.
• Full Year Revenue (2024): $463.7 million, up from $421.5 million in 2023.
• Net Income (Q4 2024): $0.7 million, including a non-cash loss on extinguishment of convertible notes.
• Full Year Net Income (2024): $46.9 million, including a non-cash loss on extinguishment of convertible notes.
• Home Closings (Q4 2024): 414 homes, up from 387 homes in Q4 2023.
• Full Year Home Closings (2024): 1,431 homes, up from 1,383 homes in 2023.
• Average Sales Price (Q4 2024): Approximately $324,000 for production-built homes.
• Net New Orders (Q4 2024): 351 homes, up from 294 homes in Q4 2023.
• Backlog (End of Q4 2024): 157 homes valued at approximately $58.3 million.
• Gross Profit Margin (Q4 2024): 16.2%, down from 18.5% in Q4 2023.
• Adjusted Gross Profit Margin (Q4 2024): 18.1%, down from 21.8% in Q4 2023.
• SG&A Expense (Q4 2024): $19.3 million; adjusted SG&A was $17.7 million or 13.1% of revenue.
• Active Communities (End of 2024): 46, down from 61 at the end of 2023.
• Liquidity: Approximately $60 million in cash and credit facility availability.

• Warning! GuruFocus has detected 6 Warning Signs with UHG.

Release Date: March 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• United Homes Group Inc (NASDAQ:UHG) reported year-over-year growth of 7% in new home deliveries and 19% in net new home orders for the fourth quarter of 2024.
• The company successfully reduced its inventory of aged specs, paving the way for a fresh start to the spring selling season.
• UHG's refreshed product lineup has received positive initial responses, leading to improved gross margins and strong sales.
• The company executed a capital markets transaction that reduced leverage by $10 million and lowered cash interest expense by 320 basis points.
• UHG's strategic initiatives, including product redesign and cost savings measures, are expected to drive revenue growth and improve profitability.

Negative Points

• Persistently high mortgage rates are negatively impacting affordability, compelling UHG to use mortgage incentives, which affect gross margins.
• The competitive market environment is leading most builders, including UHG, to sacrifice gross margin for volume.
• Completed inventory remains high across the industry, forcing UHG to offer substantial price discounts to move inventory.
• UHG's community count fell to 46 active communities at year-end, indicating a need for growth in community count to support future expansion.
• The company's gross profit margin declined to 16.2% in Q4 2024 from 18.5% in the prior year period, reflecting competitive pricing pressures and strategic sales incentives.

Q & A Highlights

Q: What strategic initiatives is United Homes Group focusing on to enhance financial and operational performance? A: Jamie Pirrello, CEO, highlighted that UHG is updating its floor plans and refreshing homes to align with current buyer preferences, which has led to positive sales responses. The company is also rebidding direct construction costs to improve gross margins and leveraging its scale to lower costs. These initiatives aim to drive revenue growth and improve profitability.

Q: How did United Homes Group perform in terms of new home deliveries and orders in the fourth quarter of 2024? A: Jack Micenko, President, reported a year-over-year growth of 7% in new home deliveries and 19% in net new home orders for the fourth quarter. The company also reduced its inventory of aged specs, setting the stage for a strong spring selling season.

Q: What financial impact did the capital markets transaction in December have on United Homes Group? A: Jack Micenko, President, explained that the transaction refinanced the company's convertible notes, reducing leverage by $10 million and lowering cash interest expense by 320 basis points. It also reduced potential dilution from convertible notes by about 30% and brought in Kennedy Lewis as a strategic shareholder.

Q: What were the financial results for United Homes Group in the fourth quarter of 2024? A: Keith Feldman, CFO, reported a net income of $0.7 million for the fourth quarter, with revenue of $134.8 million, up from $116.8 million in the prior year. The average sales price for production-built homes increased to approximately $324,000. However, gross profit margin declined to 16.2% due to competitive pricing and strategic sales incentives.

Q: How is United Homes Group positioned for future growth? A: Keith Feldman, CFO, stated that UHG controls approximately 7,700 lots through a mix of owned options and land banked assets, positioning the company to capture market opportunities. The company has $60 million in liquidity and is focused on adapting to market conditions for continued success in 2025 and beyond.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.