ATLANTA, Jan. 26, 2017 /PRNewswire/ -- PulteGroup, Inc. (NYSE: PHM) announced today financial results for its fourth quarter ended December 31, 2016. For the quarter, PulteGroup reported net income of $273 million, or $0.83 per share, inclusive of $0.16 per share of insurance and income tax benefits. Prior year reported net income of $228 million, or $0.64 per share, included $0.07 per share of benefits associated with the reversal of certain mortgage and insurance reserves.

"With the gains achieved in our fourth quarter results, PulteGroup completed a year in which it realized significant growth, including double-digit year-over-year increases in orders, closings, revenues, net income and backlog," said Ryan Marshall, President and CEO of PulteGroup. "Consistent with the Company's long-term objectives, our outstanding 2016 operating results drove strong returns on invested capital, which we view as an important component to delivering increased shareholder value over the housing cycle.

"The gains PulteGroup realized for the quarter and full year reflect the successful investments we are making into our business, in combination with the positive demand conditions that continue in the housing market. We believe that continued favorable trends in the economy, job growth, demographics and consumer confidence can more than offset the impact of modestly higher rates, allowing the housing recovery to continue at a steady pace."


Fourth Quarter Results

Home sale revenues for the fourth quarter totaled $2.4 billion, an increase of 21% over the prior year. Higher revenues for the period were driven by a 9% increase in closings to 6,197 homes, combined with an 11% increase in average selling price to $391,000. The Company's average selling price continues to benefit from a shift in the mix of homes closed, along with price increases realized by all three of the Company's national brands: Centex, Pulte Homes and Del Webb.

Beginning with this quarter's reporting, the Company reclassified internal and external sales commission expense from home sale cost of revenues to SG&A in order to be more consistent with a majority of its peers. Based on this reclassification of commission expense, the Company's reported home sale gross margin was 24.8% in the fourth quarter. Commission expense was 3.5% of revenue in the quarter.

SG&A expense in the fourth quarter, including commissions, was $208 million, or 8.6% of home sale revenues. Fourth quarter SG&A includes a $55 million benefit relating to a reversal of construction related insurance reserves in the period. SG&A expense, including commissions, in the fourth quarter of 2015 was $210 million, or 10.5% of home sale revenues. Prior year SG&A included a $30 million benefit relating to a reversal of construction related insurance reserves.

For the quarter, net new orders increased 15% over the prior year to 4,202 homes. The dollar value of fourth quarter orders increased 22% over the prior year to $1.7 billion. The Company ended the year with 726 active communities, which represents an increase of 17% over the comparable prior year period.

PulteGroup's year-end backlog of 7,422 homes, valued at $2.9 billion, compares with prior year backlog of 6,731 homes, valued at $2.5 billion. The average selling price in backlog increased 9% over the prior year to $396,000, which reflects a continued mix shift toward higher priced homes and moderate price increases.

The Company's financial services operations reported pretax income for the quarter of $25 million. Prior year financial services pretax income of $29 million included a $12 million benefit relating to a reversal of mortgage repurchase reserves. Financial services pretax income primarily benefitted from higher closing volumes in the Company's homebuilding operations and a fourth quarter capture rate of 82%.

For the quarter, the Company reported $141 million of income tax expense, representing an effective tax rate of 34%. The Company's effective tax rate for the quarter was lower than its previous guidance of 38%, due to the recognition of energy efficient home credits, as well as a deferred tax benefit relating to a legal entity restructuring.

During the fourth quarter, the Company repurchased 13.2 million common shares for $252 million, or an average price of $19.07 per share. The Company ended the year with a cash balance of $723 million.

A conference call discussing PulteGroup's fourth quarter results will be held Thursday, January 26, 2017, at 8:30 a.m. Eastern Time, and webcast live via www.pultegroupinc.com. Interested investors can access the call via the Company's home page at www.pultegroupinc.com, and are encouraged to download the available slides that provide additional details on the Company's fourth quarter results.

Forward-Looking Statements
This press release includes "forward-looking statements." These statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or implied by, these statements. You can identify these statements by the fact that they do not relate to matters of a strictly factual or historical nature and generally discuss or relate to forecasts, estimates or other expectations regarding future events. Generally, the words "believe," "expect," "intend," "estimate," "anticipate," "plan," "project," "may," "can," "could," "might," "should," "will" and similar expressions identify forward-looking statements, including statements related to expected operating and performing results, planned transactions, planned objectives of management, future developments or conditions in the industries in which we participate and other trends, developments and uncertainties that may affect our business in the future.

Such risks, uncertainties and other factors include, among other things: interest rate changes and the availability of mortgage financing; competition within the industries in which we operate; the availability and cost of land and other raw materials used by us in our homebuilding operations; the impact of any changes to our strategy in responding to the cyclical nature of the industry, including any changes regarding our land positions and the levels of our land spend; the availability and cost of insurance covering risks associated with our businesses; shortages and the cost of labor; weather related slowdowns; slow growth initiatives and/or local building moratoria; governmental regulation directed at or affecting the housing market, the homebuilding industry or construction activities; uncertainty in the mortgage lending industry, including revisions to underwriting standards and repurchase requirements associated with the sale of mortgage loans; the interpretation of or changes to tax, labor and environmental laws; economic changes nationally or in our local markets, including inflation, deflation, changes in consumer confidence and preferences and the state of the market for homes in general; legal or regulatory proceedings or claims; our ability to generate sufficient cash flow in order to successfully implement our capital allocation priorities; required accounting changes; terrorist acts and other acts of war; and other factors of national, regional and global scale, including those of a political, economic, business and competitive nature. See PulteGroup's Annual Report on Form 10-K for the fiscal year ended December 31, 2015, and other public filings with the Securities and Exchange Commission (the "SEC") for a further discussion of these and other risks and uncertainties applicable to our businesses. PulteGroup undertakes no duty to update any forward-looking statement, whether as a result of new information, future events or changes in PulteGroup's expectations.

About PulteGroup
PulteGroup, Inc. (NYSE: PHM), based in Atlanta, Georgia, is one of America's largest homebuilding companies with operations in approximately 50 markets throughout the country. Through its brand portfolio that includes Centex, Pulte Homes, Del Webb, DiVosta Homes and John Wieland Homes and Neighborhoods, the Company is one of the industry's most versatile homebuilders able to meet the needs of multiple buyer groups and respond to changing consumer demand. PulteGroup conducts extensive research to provide homebuyers with innovative solutions and consumer inspired homes and communities to make lives better.

For more information about PulteGroup, Inc. and PulteGroup brands, go to www.pultegroupinc.com; www.pulte.com; www.centex.com; www.delwebb.com;www.divosta.com and www.jwhomes.com.




                                                                   PulteGroup, Inc.

                                                          Consolidated Results of Operations

                                                       ($000's omitted, except per share data)

                                                                     (Unaudited)


                                                                 Three Months Ended                                 Year Ended

                                                                   December 31,                                 December 31,

                                                         2016                                   2015        2016                 2015
                                                         ----                                   ----        ----                 ----

    Revenues:

    Homebuilding

      Home sale revenues                                         $2,423,472                            $1,997,309                      $7,451,315  $5,792,675

      Land sale revenues                               15,431                                   20,885                    36,035            48,536
                                                       ------                                   ------                    ------            ------

                                                    2,438,903                                2,018,194                 7,487,350         5,841,211

    Financial Services                                 54,175                                   43,434                   181,126           140,753
                                                       ------                                   ------                   -------           -------

    Total revenues                                  2,493,078                                2,061,628                 7,668,476         5,981,964
                                                    ---------                                ---------                 ---------         ---------


    Homebuilding Cost of Revenues:

    Home sale cost of revenues                    (1,821,672)                              (1,456,186)               (5,587,974)       (4,235,945)

    Land sale cost of revenues                       (14,256)                                (13,867)                 (32,115)         (35,858)
                                                      -------                                  -------                   -------           -------

                                                  (1,835,928)                              (1,470,053)               (5,620,089)       (4,271,803)


    Financial Services expenses                      (29,370)                                (14,138)                (108,573)         (82,047)

    Selling, general, and administrative expenses   (207,647)                               (210,398)                (957,150)        (794,728)

    Other expense, net                                (6,412)                                   6,276                  (48,814)         (17,363)
                                                       ------                                    -----                   -------           -------

    Income before income taxes                        413,721                                  373,315                   933,850           816,023

    Income tax expense                              (140,549)                               (145,288)                (331,147)        (321,933)
                                                     --------                                 --------                  --------          --------

    Net income                                                     $273,172                              $228,027                        $602,703    $494,090
                                                                   ========                              ========                        ========    ========


    Net income per share:

    Basic                                                             $0.83                                 $0.65                           $1.76       $1.38
                                                                      =====                                 =====                           =====       =====

    Diluted                                                           $0.83                                 $0.64                           $1.75       $1.36
                                                                      =====                                 =====                           =====       =====

    Cash dividends declared                                           $0.09                                 $0.09                           $0.36       $0.33
                                                                      =====                                 =====                           =====       =====


    Number of shares used in calculation:

    Basic                                             325,975                                  348,699                   339,747           356,576

    Effect of dilutive securities                       1,834                                    3,047                     2,376             3,217
                                                        -----                                    -----                     -----             -----

    Diluted                                           327,809                                  351,746                   342,123           359,793
                                                      =======                                  =======                   =======           =======



                                     PulteGroup, Inc.

                          Condensed Consolidated Balance Sheets

                                     ($000's omitted)

                                       (Unaudited)


                                    December 31,                December 31,
                                            2016                           2015
                                            ----                           ----


    ASSETS


    Cash and
     equivalents                                      $698,882                      $754,161

     Restricted
     cash                                 24,366                           21,274
                                          ------                           ------

    Total
     cash,
     cash
     equivalents,
     and
     restricted
     cash                                723,248                          775,435

    House and
     land
     inventory                         6,770,655                        5,450,058

    Land held
     for sale                             31,728                           81,492

     Residential
     mortgage
     loans
     available-
     for-
     sale                                539,496                          442,715

     Investments
     in
     unconsolidated
     entities                             51,447                           41,267

    Other
     assets                              857,426                          893,345

     Intangible
     assets                              154,792                          110,215

    Deferred
     tax
     assets,
     net                               1,049,408                        1,394,879
                                       ---------                        ---------

                                                   $10,178,200                    $9,189,406
                                                   ===========                    ==========



    LIABILITIES AND
     SHAREHOLDERS' EQUITY


    Liabilities:

    Accounts
     payable                                          $405,455                      $327,725

    Customer
     deposits                            187,891                          186,141

    Accrued
     and
     other
     liabilities                       1,448,994                        1,516,783

    Income
     tax
     liabilities                          34,860                           57,050

    Financial
     Services
     debt                                331,621                          267,877

    Term loan                                  -                         498,423

    Senior
     notes                             3,110,016                        1,576,082
                                       ---------                        ---------

      Total
       liabilities                     5,518,837                        4,430,081

     Shareholders'
     equity                            4,659,363                        4,759,325

                                                   $10,178,200                    $9,189,406
                                                   ===========                    ==========





                                            PulteGroup, Inc.

                                 Consolidated Statements of Cash Flows

                                            ($000's omitted)

                                              (Unaudited)

                                                             Year Ended

                                                          December 31,

                                                 2016                   2015
                                                 ----                   ----

    Cash flows from operating
     activities:

    Net income                                           $602,703                        $494,090

    Adjustments to reconcile net
     income to net cash from
     operating activities:

    Deferred
     income tax
     expense                                  334,787                           311,699

    Write-down
     of land
     and
     deposits
     and pre-
     acquisition
     costs                                     19,357                            11,467

     Depreciation
     and
     amortization                              54,007                            46,222

    Share-
     based
     compensation
     expense                                   22,228                            24,752

    Loss on
     debt
     retirements                                  657                                 -

    Other, net                                  1,614                           (4,865)

    Increase (decrease) in cash
     due to:

    Inventories                             (897,092)                        (917,298)

    Residential
     mortgage
     loans
     available-
     for-sale                                (99,527)                        (104,609)

    Other
     assets                                  (45,721)                        (175,150)

    Accounts
     payable,
     accrued
     and other
     liabilities                               75,257                          (23,898)

    Net cash
     provided
     by (used
     in)
     operating
     activities                                68,270                         (337,590)
                                               ------                          --------

    Cash flows from investing
     activities:

    Capital
     expenditures                            (39,295)                         (45,440)

    Investment
     in
     unconsolidated
     subsidiaries                            (14,539)                            (454)

    Cash used
     for
     business
     acquisition                            (430,458)                                -

    Other
     investing
     activities,
     net                                       13,100                            11,330
                                               ------                            ------

    Net cash
     used in
     investing
     activities                             (471,192)                         (34,564)
                                             --------                           -------

    Cash flows from financing
     activities:

    Proceeds
     from debt
     issuance                               1,995,937                           498,087

    Repayments
     of debt                                (986,919)                        (239,193)

    Borrowings
     under
     revolving
     credit
     facility                                 619,000                           125,000

    Repayments
     under
     revolving
     credit
     facility                               (619,000)                        (125,000)

    Financial
     Services
     borrowings                                63,744                           127,636

    Stock
     option
     exercises                                  5,845                            10,535

    Share
     repurchases                            (603,206)                        (442,738)

    Dividends
     paid                                   (124,666)                        (115,958)
                                             --------                          --------

    Net cash
     provided
     by (used
     in)
     financing
     activities                               350,735                         (161,631)
                                              -------                          --------

    Net
     increase
     (decrease)                              (52,187)                        (533,785)

    Cash, cash
     equivalents
     and
     restricted
     cash at
     beginning
     of period                                775,435                         1,309,220

    Cash, cash
     equivalents
     and
     restricted
     cash at
     end of
     period                                              $723,248                        $775,435
                                                         ========                        ========


    Supplemental Cash Flow
     Information:

    Interest
     paid
     (capitalized),
     net                                                $(26,538)                       $(4,193)
                                                         ========                         =======

    Income
     taxes paid
     (refunded),
     net                                                   $2,743                        $(5,654)
                                                           ======                         =======



                                                                      PulteGroup, Inc.

                                                                        Segment Data

                                                                      ($000's omitted)

                                                                         (Unaudited)


                                                              Three Months Ended                                Year Ended

                                                                December 31,                                December 31,


                                                         2016                               2015        2016                 2015
                                                         ----                               ----        ----                 ----

    HOMEBUILDING:

    Home sale revenues                                        $2,423,472                           $1,997,309                      $7,451,315  $5,792,675

    Land sale revenues                                 15,431                               20,885                    36,035            48,536
                                                       ------                               ------                    ------            ------

    Total Homebuilding revenues                     2,438,903                            2,018,194                 7,487,350         5,841,211


    Home sale cost of revenues                    (1,821,672)                          (1,456,186)               (5,587,974)       (4,235,945)

    Land sale cost of revenues                       (14,256)                            (13,867)                 (32,115)         (35,858)

    Selling, general, and administrative expenses   (207,647)                           (210,398)                (957,150)        (794,728)

    Other income (expense), net                       (6,604)                               6,276                  (49,345)         (17,363)
                                                       ------                                -----                   -------           -------

    Income before income taxes                                  $388,724                             $344,019                        $860,766    $757,317
                                                                ========                             ========                        ========    ========


    FINANCIAL SERVICES:

    Income before income taxes                                   $24,997                              $29,296                         $73,084     $58,706
                                                                 =======                              =======                         =======     =======


    CONSOLIDATED:

    Income before income taxes                                  $413,721                             $373,315                        $933,850    $816,023
                                                                ========                             ========                        ========    ========




                                                                                                          PulteGroup, Inc.

                                                                                                      Segment Data, continued

                                                                                                          ($000's omitted)

                                                                                                            (Unaudited)


                                                                                           Three Months Ended                                 Year Ended

                                                                                            December 31,                               December 31,


                                                                                    2016                            2015             2016                    2015
                                                                                    ----                            ----             ----                    ----


    Home sale revenues                                                                     $2,423,472                           $1,997,309                        $7,451,315         $5,792,675
                                                                                           ==========                           ==========                        ==========         ==========


    Closings - units

    Northeast                                                                        529                               531                         1,418                1,496

    Southeast (a)                                                                  1,102                             1,027                         3,901                3,276

    Florida                                                                        1,093                               986                         3,441                2,896

    Midwest                                                                        1,142                               977                         3,418                2,961

    Texas                                                                          1,080                             1,036                         3,726                3,357

    West                                                                           1,251                             1,105                         4,047                3,141

                                                                                   6,197                             5,662                        19,951               17,127
                                                                                   =====                             =====                        ======               ======

    Average selling price                                                                        $391                                 $353                              $373               $338
                                                                                                 ====                                 ====                              ====               ====


    Net new orders - units

    Northeast                                                                        306                               253                         1,361                1,479

    Southeast (a)                                                                    804                               695                         3,810                3,454

    Florida                                                                          705                               697                         3,585                3,168

    Midwest                                                                          766                               630                         3,636                2,862

    Texas                                                                            784                               621                         3,793                3,429

    West                                                                             837                               763                         4,141                3,616

                                                                                   4,202                             3,659                        20,326               18,008
                                                                                   =====                             =====                        ======               ======

    Net new orders - dollars (b)                                                           $1,666,066                           $1,364,821                        $7,753,399         $6,305,380
                                                                                           ==========                           ==========                        ==========         ==========


                                                                                                                                         December 31,

                                                                                                                                 2016                    2015
                                                                                                                                 ----                    ----

    Unit backlog

    Northeast                                                                                                                     387                       444

    Southeast (a)                                                                                                               1,371                     1,146

    Florida                                                                                                                     1,418                     1,274

    Midwest                                                                                                                     1,307                     1,089

    Texas                                                                                                                       1,412                     1,345

    West                                                                                                                        1,527                     1,433

                                                                                                                                7,422                     6,731
                                                                                                                                =====                     =====

    Dollars in backlog                                                                                                                  $2,941,512                        $2,456,565
                                                                                                                                        ==========                        ==========


    (a)       Southeast includes the acquisition in January 2016 of substantially all of the assets of JW Homes ("Wieland").

    (b)       Net new orders excludes backlog acquired from Wieland in January 2016. Net new order dollars represent a
                composite of new order dollars combined with other movements of the dollars in backlog related to cancellations
                and change orders.



                                                                         PulteGroup, Inc.

                                                                      Segment Data, continued

                                                                         ($000's omitted)

                                                                            (Unaudited)


                                                          Three Months Ended                                       Year Ended

                                                           December 31,                                    December 31,


                                                   2016                      2015             2016                      2015
                                                   ----                      ----             ----                      ----

    MORTGAGE ORIGINATIONS:

    Origination volume                            4,250                                 3,820                        13,373         11,435
                                                  =====                                 =====                        ======         ======

    Origination principal                                $1,225,568                                $1,013,140                  $3,706,745  $2,929,531
                                                         ==========                                ==========                  ==========  ==========

    Capture rate                                  81.8%                                82.8%                        81.2%         82.9%
                                                   ====                                  ====                          ====           ====




                                                                 Supplemental Data

                                                                 ($000's omitted)

                                                                    (Unaudited)


                                                        Three Months Ended                                  Year Ended

                                                           December 31,                                    December 31,


                                                   2016                      2015             2016                      2015
                                                   ----                      ----             ----                      ----


    Interest in inventory, beginning of period             $176,661                                  $155,781                    $149,498    $167,638

    Interest capitalized                         44,961                                29,896                       160,506        120,001

    Interest expensed                          (35,525)                             (36,179)                    (123,907)     (138,141)

    Interest in inventory, end of period                   $186,097                                  $149,498                    $186,097    $149,498
                                                           ========                                  ========                    ========    ========

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SOURCE PulteGroup, Inc.