Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)  

DR Horton (NYSE:DHI)

Q2 2013 Earnings Call

April 26, 2013 10:00 am ET

Executives

Donald J. Tomnitz - Vice Chairman, Chief Executive Officer, President and Member of Executive Committee

Stacey H. Dwyer - Executive Vice President and Treasurer

Bill W. Wheat - Chief Financial Officer, Principal Accounting Officer and Executive Vice President

Mike Murray

Analysts

Daniel Oppenheim - Crédit Suisse AG, Research Division

Stephen F. East - ISI Group Inc., Research Division

Michael A. Roxland - BofA Merrill Lynch, Research Division

Michael Jason Rehaut - JP Morgan Chase & Co, Research Division

Kenneth R. Zener - KeyBanc Capital Markets Inc., Research Division

Adam Rudiger - Wells Fargo Securities, LLC, Research Division

Susan Maklari - UBS Investment Bank, Research Division

Jade J. Rahmani - Keefe, Bruyette, & Woods, Inc., Research Division

Joel Locker - FBN Securities, Inc., Research Division

Jack Micenko - Susquehanna Financial Group, LLLP, Research Division

Stephen Kim - Barclays Capital, Research Division

Alex Barrón - Housing Research Center, LLC

Megan McGrath - MKM Partners LLC, Research Division

Buck Horne - Raymond James & Associates, Inc., Research Division

Operator

Good morning and welcome to the D.R. Horton, America's Builder, the largest builder in the United States, second quarter 2013 earnings release conference call. [Operator Instructions] As a reminder, this conference is being recorded. It is now pleasure to introduce your host, Donald Tomnitz, President and CEO for D.R. Horton. Thank you, Mr. Tomnitz. You may begin.

Donald J. Tomnitz

Thank you and good morning. Joining me this morning are Bill Wheat, Executive Vice President and CFO; Stacey Dwyer, Executive Vice President and Treasurer; and Mike Murray, Senior Vice President. As usual, before we get started, Stacey?

Stacey H. Dwyer

Some comments made on this call may constitute forward-looking statements as defined by the Private Securities and Litigation Reform Act of 1995. Although D.R. Horton believes any such statements are based on reasonable assumptions, there's no assurance that actual outcomes will not be materially different. All forward-looking statements are based upon information available to D.R. Horton on the day of this conference call, and D.R. Horton does not undertake any obligation to publicly update or revise any forward-looking statements. Additional information about issues that could lead to material changes in performance is contained in D.R. Horton's annual report on Form 10-K and our most recent quarterly report on Form 10-Q, both of which are filed with the Securities and Exchange Commission. Don?

Donald J. Tomnitz

The spring selling season is in full swing, especially for D.R. Horton. Demand for homes has strengthened and the relative available housing supply has shrunk which has created a favorable pricing environment. Our first-time buyer demand remains very strong, and we continue to see improving demand for our move up buyers. We are well positioned to meet the increasing demand across our broad geographic footprint, with our inventory of homes available for sale and with the land and lot position we have accumulated over the past 3 to 4 years.

Our team of operators across the country delivered an outstanding second quarter. They generated significant sales and revenue growth along with substantial improvements in profit margins and returns, which resulted in our pretax income more than tripling last year's levels. Overall, the first half of fiscal year 2013 was nothing short of phenomenal, and we expect the second half to be even better. Bill?

Bill W. Wheat

In the second quarter, our consolidated pretax income increased 236% to $142.1 million from $42.3 million in the year-ago quarter. Our pretax income, as a percentage of consolidated revenue, was 9.9%, an increase of 550 basis points from 4.4% in the prior year quarter, reflecting significant improvement in both our homebuilding and financial services operations. Compared to the year-ago quarter, homebuilding pretax income increased to $127.4 million from $34.6 million, and financial services pretax income increased to $14.7 million from $7.7 million.

Net income for the second quarter increased 173% to $111 million or $0.32 per diluted share, compared to $40.6 million or $0.13 per diluted share in the year-ago quarter. Our net income for the quarter included a noncash tax benefit of $18.7 million from a reduction of the valuation allowance on our deferred tax asset. Mike?

Mike Murray

Our second quarter home sales revenues increased 47% to $1.4 billion on 5,643 homes closed, up from $930.6 million on 4,240 homes closed in the year-ago quarter. Our average closing price for the quarter was $242,500, up 10% compared to the prior year, driven primarily by pricing power and, to a lesser extent, by a larger average home size. Don?

Donald J. Tomnitz

The value of our net sales orders increased 52% from last year due to increased volume and home prices. Our net sales orders increased 34% to 7,879 homes, on a 15% increase in active selling communities. Our average sales price on net sales orders of $253,400 increased 14% compared to the year-ago quarter. The cancellation rate for the second quarter was 19%, compared with the 22% in the year-ago quarter.

The value of our backlog increased 76% from a year ago to $2.4 billion, with an average sales price per home of $249,800. Homes in backlog increased 54% from the prior year to 9,553 homes. Our backlog conversion rate for the quarter was 77%, compared to 94% in the prior year quarter. We expect this rate to continue to revert closer to historical seasonal norms. For the third quarter, we expect our conversion rate to be in the low 70% range. We have continued to see a solid sales pace . Stacey?

Stacey H. Dwyer

Our gross profit margin on home sales revenue in the second quarter was 20.4%, up 280 basis points from the year-ago period. 210 basis points of the margin increase was due to improving market conditions, resulting in reduced incentives and higher average selling prices, in excess of cost increases. 40 basis points of the margin was due to lower amortized interest and property taxes, and 30 basis points was due to lower estimated costs for warranty and construction defect claims, add the percentage of home sales revenue. Sequentially, our gross margin on home sales revenue improved 160 basis points, of which 30 basis points was due to improving market conditions. The additional 130 basis points of the increase was due to lower relative cost for warranty and construction defect claims, as a percentage of home sales revenue, with approximately 40 basis points of the 130, due to a higher level of cash reimbursements of previously incurred litigation cost received during this quarter, as compared to our Q1. We expect to see continued improvement in our home sales gross margin from improving market conditions for the rest of the year. For the third quarter, we expect a home sales gross margin of approximately 20%. Mike?

Mike Murray

Homebuilding SG&A expense for the quarter was $155.1 million compared to $127.5 million in the prior year quarter. As a percentage of homebuilding revenues, SG&A improved to 240 basis points to 11.2% from 13.6%. We are leveraging our fixed cost structure, while at the same time, building our sales and production capabilities, where necessary, to meet our increasing demand. We expect our SG&A, as a percentage of homebuilding revenues, to be below 11% for the remainder of the fiscal year. The improvements in our gross profit and SG&A percentages, and the decrease in our direct interest expense, expanded our homebuilding pretax margin to an industry-leading 9.2% in the current quarter, an increase of 550 basis points from 3.7% in the year-ago quarter. Stacey?

Stacey H. Dwyer

Financial services pretax income for the quarter was $14.7 million compared to $7.7 million in the year-ago quarter. 86% of our mortgage company's loan originations during the quarter, related to homes closed by our homebuilding operations. Our mortgage company handled the financing for 58% of our homebuyers this quarter, with virtually all loans meeting eligibility requirements for sale to Fannie Mae, Freddie Mac or Ginnie Mae. FHA and VA loans accounted for 49% of our mortgage company's volume this quarter, down from 57% in the year-ago quarter. Our mortgage company's new borrowers, during the quarter, had an average FICO score of 723 and an average loan-to-value ratio of 90%. First-time homebuyers represented 47% of the closings handled by our mortgage company this quarter, compared to 49% in the year-ago quarter. Bill?

Bill W. Wheat

At March 31, after considering the impact of our improving profits, we concluded that it was more likely than not that we would realize more of our deferred tax assets from state net operating loss carryforwards before they expire than we previously anticipated. As a result, we reduced our deferred tax asset valuation allowance by $18.7 million in the quarter, which reduced our income tax expense this quarter. Mike?

Mike Murray

Since December, our construction in progress and finished homes inventory increased by approximately $207 million. We had 15,800 homes in inventory at the end of March, up 1,600 homes from last quarter and up 4,700 homes from a year ago. As of March 31, 1,200 of our homes were models, 7,600 were speculative homes and 2,300 of the specs were completed. We expect to continue to increase our homes in inventory to meet demand, and we expect our average community count for the remainder of the fiscal year to remain 10% to 15% higher than last year. Don?

Donald J. Tomnitz

In our second fiscal quarter, our investments in lots, land and development cost totaled $460 million, as we continue to find new communities and build our lost supply to meet increasing demand. Of the $460 million, $217 million was used to purchase finished lots, $110 million was to purchase land and $133 million was for land development cost. We expect our development spending will increase over the next few quarters. At March 31, 2013, we control approximately 175,000 lots, of which 120,000 are owned and 55,000 are optioned. 30,000 of our owned lots and 28,000 of our optioned lots are finished. The 58,000 total finished lots we control at quarter end are up 23% from a year ago. Bill?

Bill W. Wheat

Our total available liquidity, at March 31, was $1.7 billion, which included homebuilding unrestricted cash of $1.1 billion and available capacity on our revolving credit facility of $559 million. The balance of our public notes outstanding, at March 31, was $3 billion, and we had no cash borrowings on our revolver. $172 million of our notes mature in May 2013, and we have a total of $317 million of senior note maturities in the next 12 months. At March 31, our homebuilding leverage ratio, net of cash, was 33.7%, and our gross homebuilding leverage was 44.7%. Don?

Donald J. Tomnitz

In closing, this quarter was D.R. Horton's most profitable second quarter since 2006 with $142 million of pretax income. All of our operating metrics improved dramatically on a year-over-year basis this quarter. The value of our sales, closings and backlog, increased by 52%, 47% and 76%, respectively. Our pretax income increased 236%. Our pretax income margin increased 550 basis points to 9.9%. Our gross margin on home sales revenues increased 280 basis points. Our SG&A, as a percentage of homebuilding revenues, improved 240 basis points. And we are continuing to experience pricing power in many of our markets, as evidenced by a 14% increase in average sales price.

D.R. and I would like to personally thank all of our D.R. Horton teammates. We have accomplished all of this with only a 29% increase in employees year-over-year. Our team is consistently the most efficient in terms of closings per employee. And I'm really pleased to share with you that this quarter, we sold more homes, closed more homes, generated more revenue, earned more PTI and had a higher PTI margin than any other builder. We are in a great position, as a company. We will, clearly, in 2013, be the homes closed, revenue, PTI and PTI percentage leading builder for the year. As used to say, stop for a moment and we should smell the roses for our major accomplishments. We'll get right back to work so we can continue to outperform our competition. D.R. and I thank you for the great work.

This concludes our prepared remarks, and I will host any questions.

Question-and-Answer Session

Operator

[Operator Instructions] Our first question is coming from Dan Oppenheimer from Crédit Suisse.

Daniel Oppenheim - Crédit Suisse AG, Research Division

You're talking about the land investment there, saying that could more in terms of development. There is so much, in terms of the purchases, during the fourth calendar quarter of last year's in tax related sales, I think, that sort of benefit you in the purchasing side. How much do you think of that in terms of just adding more land versus just developing what you currently have?

Donald J. Tomnitz

What we're focused on, clearly, Dan, developing what we have. Obviously, our goal is to bring what we've purchased, especially in the last calendar year, into production. So as we say, built so close homes and make money on those units. We are continuing to add land deals and anticipating, obviously, developing those in markets where the option lots are becoming shorter and shorter in supply. Clearly, based upon the number of option lots that we added to our portfolio, we were able to still find option lots, never finished, and finding, also, developed lots on our on-option basis. But there are markets where we're going to have to supplement the third party developers, as well as the finished option lots, with land that we have to bill for ourselves. And, of course, we've been very adept at that over the years. Given the sales pace we're seeing, the demand we're seeing, the pricing dynamics we're seeing, we would expect to still be investing strongly in finished lots, land and development in the coming quarters, as we have been so far this year.

Daniel Oppenheim - Crédit Suisse AG, Research Division

Great. And in terms of just the margins. I think, you talked about, then doing -- pushing pricing with the average selling price up. How are you sort of -- we've heard lots of different thoughts from -- the course of effects of this week here in terms of the earnings releases from different builders. In terms of the thoughts on pushing a price versus continuing to increase absorption at this point. How are you balancing the 2 right now?

Donald J. Tomnitz

Well, clearly, you can see that we increased our sales and our closings this quarter dramatically. All the while, we're dramatically improving our margins. We think we're in a wonderful position. There is a shortage of finished homes on the marketplace. So not only with our good inventory of specs that we consistently have maintained in this company, we will continue to push price as well as volume. Clearly we've said before, our goal is, improve the bottom line better than we improve the top line. But nevertheless, we are in a position where we can do both.

Operator

Our next question is coming from Stephen East from ISI Group.

Stephen F. East - ISI Group Inc., Research Division

To follow on what Dan was talking about on the land side, maybe a little bit more, what are you all seeing in the pricing of land? And are there any markets that it's just very difficult to make land pencil, and then, if you look at your communities that you're opening right now and that you've got open, how many -- what percentage of that is previously mothballed? Or that either you're already in or will be opening?

Donald J. Tomnitz

Actually, I was on the phone with one of our regional presidents this morning, David Auld, and we were talking about how we are very fortunate that we were early mover in terms of finding land positions 1 year ago, and 2 years ago, because our basis in that land, to answer your question directly, is very attractive, relative to where pricing is in land today. Specifically, land prices have escalated in most markets rather dramatically over the last 6 to 12 months. We're very conservative in terms of our approach because we don't need to buy that much new land to support what we see over the next 2 years as our net sales and our net closings. But clearly, land prices have gone up. As far as mothballed assets go, in terms of deliveries on mothballed assets, that still a very small amount of our overall deliveries. But we are, certainly, with the improved pricing environment, improved demand, we are bringing -- starting to bring more mothballed communities into our production. So we will see some impact from that, and that's certainly a very good source of capital for us as we will not have to purchase the land. We'll just have put to the development costs in. You will see that on our balance sheet. Our land held for development balance declined this quarter, down to 602 million as compared to 630 million last quarter. And we would expect to bring even more projects out of mothball over the coming quarters as things continue to improve.

Stephen F. East - ISI Group Inc., Research Division

Okay. And then, if we go back to -- you talked about the majority of your pricing was true pricing power, not mix shift. Could you give us a little more color on that? And just what you've are seeing on the cost side? So we can understand what type the magnitude you have on pricing power versus cost inflation?

Donald J. Tomnitz

Certainly, there's cost inflation out there. One of the things that we've been able to do clearly is raise prices faster than what our cost have been going up. To control our cost, both on a national, regional and then also on a division-by-division basis At this point, we are still clearly the largest builder in the clubhouse. And by virtue of that, we have more purchasing power than most of our competitors. And it's been a focus of this company for years to focus on our sticks and brick, which is what we're doing. In terms of specifics on the pricing power versus mix shift, our average selling price per square foot, year-over-year, for this quarter, increased 7.6%. The average square footage of the homes that we closed this quarter increased 3.7% from last year. So that's a mix between pricing and size of the home. In terms of our cost increases, those were up on a per square foot basis, 3.8%, year-over-year. So we still have a very good gap between our selling price increases versus our cost increases.

Operator

Our next question is coming from Michael Roxland from Bank of America Merrill Lynch.

Michael A. Roxland - BofA Merrill Lynch, Research Division

Just wanted to follow up on a comment you made on the last call regarding California. I know you had some reservations about investing there due to the economy and, really, the fact that there's not been a widespread housing recovery in that state, as compared to some of the other states, how you're involved in -- are you still witnessing those same types of issues that you witnessed in this past quarter? What occurred since then? Because it certainly stands in contrast with some of your peers have been indicating.

Donald J. Tomnitz

Well, obviously, we're more conservative last quarter in California. But the record speaks for itself this quarter. And California, for us, is doing very well now. We've made some major investments in land and lots over the course of this quarter. And we're well positioned to capitalize on what is turning out to be a better-than-expected California housing recovery.

Michael A. Roxland - BofA Merrill Lynch, Research Division

And do you happen to have a sense of like what's driving the recovery in California? Can you talk to us of some of the specific markets that you're -- within the broader State of California, that are doing well for you?

Donald J. Tomnitz

Well, I'm going to refrain from speaking about any specific markets, again, I promised myself that a couple of years ago. But I would say to you, I think, what is driving -- in the Bay Area, clearly, technology is still driving that market, as well as, what I've understood is there are a lot more money managers in the Bay Area, over the course of the past 2 years, actually, employees managing the money of the technology industry in Northern California. And in Southern California, I think, it's just purely people buying homes because they're more affordable than they have been in a long, long period of time. So there are people who are able to sell their homes for the first time, in a long time. And then they're able to either trade up, and downsize, and capitalize on the potential having more appreciation in a new home versus the existing home that they are currently living in.

Michael A. Roxland - BofA Merrill Lynch, Research Division

Got it. And then just quickly, Don. I know you mentioned briefly in your comments that trends that you've seen thus far in April have persisted. So it sounds like there's really been no change in momentum, so the sales pace has been relatively consistent thus far, in the fiscal third quarter.

Donald J. Tomnitz

Absolutely.

Operator

Our next question is coming from Michael Rehaut from JPMorgan.

Michael Jason Rehaut - JP Morgan Chase & Co, Research Division

The first question I had was on the gross margins. You mentioned that price continues to outpace cost, and the break out of that was very helpful, so thank you for that. At the same time, you're looking at gross margins flat, sequentially, going into the third quarter. And certainly, I understand part of that and perhaps it's with timing of the warranty cost that helped you sequentially this quarter. But at the same time, would it be fair to say, as long as these trends continue that -- and I don't know if 4Q is too premature to talk about. But as we look into next year, that the 20%, at least, for the rest of this year's sustainable, and as long as a trends hold, we could expect some further expansion into fiscal '14?

Donald J. Tomnitz

Yes, it all comes into what's your in your crystal ball, Mike. If trends continue, if we continue to see double-digit pricing increases, we would expect that margins would continue to increase. But when we're looking at a land deal, we don't factor in future price appreciation into our assumptions in order to justify a land deal. We take a similar approach in our overall expectations in the business. Certainly, if things continue at the pace, we'll see some further improvement. But based on what we see right now. what's in our backlog? We're comfortable with our guidance for next quarter.

Michael Jason Rehaut - JP Morgan Chase & Co, Research Division

Okay. Also, Don, you made an interesting comment at the beginning of the year -- at the beginning of the call, rather, about first-time buyer demand remaining very strong, but move up demand improving. And maybe not to read too much into the exact word, word-by-word, but most of the builders have kind of talked about, over the past year, really, the move up buyer being the strong element, so far, and more waiting for the first-time buyer to come back or demonstrate the same type of strength that the move up has. Then it almost seems like your comments were in reverse, that the first time was more the bed rock remaining very strong and the move up improving. So am I reading that right or interpreting that right? And is the first time better for you guys than maybe you feel some of your peers are? And are you just there for -- but on the move up side, more aggressively addressing that market given the strength there as well?

Donald J. Tomnitz

Yes, to answer your question. As you know, we have focused on the first-time buyer, for years, at this company, and we still believe that's the largest component of the home market. And we are priced very competitively in the marketplace and can compete, and we're able to offer buyers who are moving out of apartments and more attractively-priced home, due to our low cost and our volume. So it's natural for us, given our size, to be able to offer a more competitively priced first-time home buyer opportunity for those people moving out of their apartments. And as mentioned to you probably 1.5 years ago, we began a significant focus on the move up buyer, and we are penetrating that market very well. And we expect that part of our business to continue to grow as it has.

Michael Jason Rehaut - JP Morgan Chase & Co, Research Division

Great, I appreciate it. One last quick one, if I could. The financial services profit ticked down about $3 million, sequentially, despite homebuilding revenue up and land financial services revenue flat, anything going on there? And how should we think about that in terms of the profitability going forward?

Stacey H. Dwyer

Our financial services segment has slightly different training than the home builder, because a lot of their revenue is recognized when they sell the loans. So at the end of the fourth quarter, our calendar fourth quarter, they have very large mortgage loans held for sale balance, which then they sell during our first quarter and recognize that gain on sale. But that -- their mortgage loans held for sale at the end of the December quarter are lower, and so the amount of gain that they recognized, this quarter, is a little bit lower. It's just a timing difference.

Michael Jason Rehaut - JP Morgan Chase & Co, Research Division

Okay. So that could -- drift up a little bit throughout the rest of the year?

Stacey H. Dwyer

Yes, if there's mortgage loans held for sale. It could drift up if market conditions and the margins hold.

Operator

Our next question is coming from Ken Zener from KeyBanc Capital Markets.

Kenneth R. Zener - KeyBanc Capital Markets Inc., Research Division

Can you talk about the mix in gross margins? Your ability to build and sell spec homes is, obviously, it helped you absorb a lot of fixed SG&A costs through the bottom. But I think there's still a misconception among investors that spec homes have to be at a lower margin than the homes in backlog. We think it actually can be an area that's giving you upside on gross margins, these homes that you built in January are locked in backlog at a certain price but, actually, go up as the market goes up? So could you talk about the spread in spec, first backlog, how much that impacted your second quarter results? And if your 20% number is just focused on your backlog margin expectations, as opposed to what might flow through on spec homes?

Donald J. Tomnitz

I'll let Bill handle the second part of that question.

Bill W. Wheat

Frankly, where we are today, we see a shortage of finished new homes in the marketplace. So by virtue of having that specs that we have out there, we have tremendous pricing power on our specs. We have a number of people who are listing their homes. And as one of our people in the legal who runs our environmental for us, he listed a home and had 4 offers in 3 days. So people are listing their homes and selling them a lot more quickly than what they've anticipated. And to the extent that we have spec inventory that we have out there, which has been tradition in this company, then, in essence, we have had significant pricing power in our specs. Our specs used to be slightly less in terms of margin than our build jobs, and that has semi-reversed itself. Recently we have seen some trends where some spec margins have been higher than pre-sales. We don't expect that would be the long-term trend. But in an environment where we're seeing rising pricing, that certainly can happen. And obviously, with our spec inventory, then that's certainly a benefit to our margins right now. As a matter of fact, currently, with our sales demand, we're having our spec level is slightly lower than what we preferred to have it because we, as we release it, we're selling more rapidly than we anticipate.

Kenneth R. Zener - KeyBanc Capital Markets Inc., Research Division

Could you maybe give us a little of context then to -- not necessarily the peak in '05, but what it was doing in '03, '04, what is common a for a spec to be in line with your backlog homes? Or was your backlog tied to some optionality, always a bit higher? If you could give us a context, that would be appreciated.

Bill W. Wheat

Ken, we don't have the specific data on that, from that period. But I would suspect back in a period when there were significant pricing increase, we're probably some seeing a similar trend to what we're seeing right now.

Donald J. Tomnitz

As a matter of fact, back then, we were hoping that people would cane [ph] and we could resell the home for more. We're not in that concurrent situation, but currently, we have adequate number of specs out there to meet the demand. We're trying to increase our specs because we anticipate increasing demand. And to the extent as I said, that we have a home ready for a buyer, who sells her home more quickly than anticipated, it's great position. And please don't forget, realtors are a large percentage of our sales. And realtors like one thing. They love to collect their commission more quickly. So when you have a spec home, they can typically collect their commission within 30 to 45 days, as opposed to if they sell a build job, they're having to wait 3 to 4 months to collect their commission.

Bill W. Wheat

And as we have long said, the key to being successful with specs is to manage them very carefully. And obviously, it's been part of our business model for a long time. So even though we're in a period right now, where we're seeing rising prices, we're still going stay disciplined and we're going to manage our specs effectively.

Operator

Our next question is coming from Adam Rudiger from Wells Fargo Securities.

Adam Rudiger - Wells Fargo Securities, LLC, Research Division

Don, I have a big picture question and you've kind of alluded to that some of the answers a little bit, but I want to ask you more concisely, despite the likelihood, I think, that we're probably in the early innings of a multiyear recovery, it looks like, now, you and some of your peers are already starting to generate what you, I think, you would consider normalized margins. And so, to me, there's somewhat of a disconnect there. And so I was wondering what you thought about what that means for the next few years? In terms of already achieving what might be a normal margin well ahead of kind of mid-cycle or normal production levels?

Donald J. Tomnitz

We're not going to argue with having achieve it earlier than we anticipated because it's a beautiful thing, after the last 5 years in our industry. And I thought about what your question is, and not to be negative, but to be realistic, our margin increases have been dramatic, to the extent that we're able to improve our margins as much in the future as what we certainly have done in this past quarter. You'd have to probably question this to whether we could improve them that much on a go-forward basis, quarter-after-quarter-after-quarter. Clearly, as we continue to do the volume that we're doing, I'm so proud of our people because we, clearly, will be the leader in the clubhouse, both on units as well as revenue this year. We are definitely experiencing more purchasing power than our peers. And that's really our goal. Our goal was always been to keep our SG&A as low as possible in this company, but also to be very proactive and controlling our stick and brick costs. And our volume helps us do that dramatically.

Bill W. Wheat

And if you look back over history, through cycles, even though we talk about a normalized margin of want to be a 20% gross, 10% SG&A, 10% on the bottom line. What we have seen, during the up part of the cycle in the past, when pricing has been going up, as we have seen margins above that level. Over the long-term average, it kind of averages out to the 20, but we've certainly seen periods where it's been above the 20. And we're hopeful, if trends continue, that we'll see some of that.

Adam Rudiger - Wells Fargo Securities, LLC, Research Division

I guess, Bill, interesting point you talk about that above 20, man, looks like, without having perfectly checking that model, looks like those years were really just the exceptions for 2004, '05 and '06. And so, what I'm kind of wondering is, if we think that, that's going to repeat itself, in terms of the margin potential? Or is the goal to be big and the goal to be -- scale your markets and the goal to take market share, going to kind of erase a little bit of that margin potentially or cap it?

Bill W. Wheat

The goal is always to strike the best balance. Scale and volume helps drive some efficiencies, and helps drive some bottom line profitability and margins and returns. But we'll always want to balance that, so I don't think one supersedes the other.

Donald J. Tomnitz

I would say after being in the industry for 33 years, and I'll celebrate my 30th anniversary at Horton in August, 20% and 10% and 10% is pretty much a -- it's a good return. And to the extent that our gross margins are higher than that and our SG&A is lower, I think, to a certain extent, that's largely an anomaly in this business. And you're going to have years where you're going have to do that, and you better pack away the earnings and stick them away for the days when you're going to be back to 16% to 17% margins. So clearly, I think, where we see the business year-after-year-after-year, if we can maintain a 20% gross margin, a 10% SG&A and 10% at the pretax line, that's a beautiful scenario. You take it when it's better, but you don't get too caught up in it.

Stacey H. Dwyer

And we do think this is a period of when it's better, because there is a shortage of supply compared to the current level of the demand on housing. And we alluded earlier, we are seeing land prices increase because there's a shortage of finished lots available to construct the houses. So we've got that inventory. So we think we can take advantage of the current environment and increase our margins, on going forward.

Donald J. Tomnitz

We don't have to go out and buy land at today's prices. To hit any sort of growth targets, we will still reinvest. But we're in a very good position on land. We already own houses that we can build and put in inventory to deliver strong growth and strong margins.

Operator

Our next question is coming from Susan from UBS.

Susan Maklari - UBS Investment Bank, Research Division

I want to go back and I have a land question, but I want to ask you on a slightly different way. In the sense that as you buy more land that needs to be developed, how does that inhibit your ability to adjust your community count growth? And given that -- maybe not for this year so much but, in terms of thinking about maybe up to 2014 and going forward, how you balance the need to have lots that can be delivered more quickly to be more flexible to community count relative to needing to develop land?

Donald J. Tomnitz

Well, I think, as the market recovers, there'll be a -- another party that enters into the fray, and that will be the third party developer. And so, as a result, in the past, we've always had a good group of third party developers who've had helped us provide lots for our lot inventory. Obviously, with the banks, over the last 5 years, and they're beginning to slightly increase their lending, but we are seeing third party developers qualifying for development loans. So as a result, our existing land development will be augmented by third party developers. And that would continue to increase as the market continues to improve, because as the housing market continues to improve, there's no doubt in my mind that the banks will begin lending once again.

Bill W. Wheat

There is certainly a longer lead time to opening a community when you buy land and have to develop it yourself, versus buying finished lots. But it's a very local decision. And each one of our operators in the local markets understands where their positions are, where their communities need to be replaced and where their accounts make sense to add. And they account for that lead time in planning to buy land and bring it into production at open communities. So it is definitely a difference in timing. But as Don said before, we expect there will be other opportunities, that may not exist work today, for some finished lot developers to be in place to help support our growth as well.

Stacey H. Dwyer

That's one of the reasons we give you our finished lot count and not just our total lot count. Because with 58,000 finished lots we should be able to have ascend time to adjust to demand levels that we're seeing, and react without running out of lots.

Donald J. Tomnitz

I assure you one thing we won't do, we will not run out of lots.

Susan Maklari - UBS Investment Bank, Research Division

Sure. In terms of the third party coming back in, are there any specific markets where you're seeing that maybe take hold more than in other areas?

Donald J. Tomnitz

Susan, I'm just -- I made myself a promise, I'm just not going to get market specific because I -- over the past years, I think, it's benefited our competitors more than it has our analysts. So as a result, you want to follow up with that question with Stacey or with Jessica later, they'll try to help you with that.

Operator

Our next question is coming from Jade Rahmani from KBW.

Jade J. Rahmani - Keefe, Bruyette, & Woods, Inc., Research Division

On the land spend, what percentage of the option exercises on deals that you tied up in the past?

Bill W. Wheat

Well, any deal where we bought finished lots, it would have been tied up under an option contract. We don't have the aging of when the contracts were signed, though, in terms of the buys or anything like that. But clearly, it's still a substantial portion of our spend was on finished lots.

Jade J. Rahmani - Keefe, Bruyette, & Woods, Inc., Research Division

And the -- are you see if developers increasingly look to build participation into the option deals with their structuring?

Donald J. Tomnitz

I've seen that decrease, firstly, reviewing every land deal in the company, along with Bill and Stacey, we'll tell you that 2 years ago, and even a year ago, we saw a more proper participation from developers than we are today. And I don't know why that is, but we're not seeing very much of it today. And every time we have a chance, we push back on that because we deserve the upside. And so -- but not as much today as what it was 1, 1.5 years ago.

Jade J. Rahmani - Keefe, Bruyette, & Woods, Inc., Research Division

Great. Just wanted to ask on SG&A. Simple question is, how do you look at the growth on SG&A on a year-over-year basis? This quarter's growth was less than half of the revenue growth and do you expect that kind of relationship to continue?

Bill W. Wheat

That's pretty good. Our long-term target on SG&A is 10%. And we're certainly rapidly moving in that direction. And we would expect, if things continue, we will get there. Maybe not quite this year, but we will get there. And as we grow, we certainly have to add infrastructure. We have to add people and as we add new communities, we add expenses. But there have been periods where we've been below 10%, when we've seen a lot of pricing increases. And so we could see a period below 10%, but again, 10% is a long term average. We're still striving to get there.

Stacey H. Dwyer

We're starting to see a very good SG&A leverage toward the back half of last year, so continuing to see the same level of year-over-year improvement of that same ratio, you mentioned, between incremental revenue and SG&A is -- would probably be a little bit aggressive. But we do feel that we are working our way back down toward the 10%, and as we said, we expect to be under 11% for the balance of the year.

Donald J. Tomnitz

And please don't recall, we are the most efficient on the industry. We still close and sell more homes per employee than anyone else. And I'm astounded when I looked at the number for the quarter, when we year-over-year increased our employee count by 29%, but yet our sales closings and backlog values increased 52%, 47% and 76%, respectively. We leveraged our overhead extraordinarily well.

Operator

Our next question is coming from Joel Locker from FBN Securities.

Joel Locker - FBN Securities, Inc., Research Division

Just wanted to, I guess, get behind -- you mentioned brokers before, and wanted to see what the participation rate from outside brokers were in the second quarter closing. What that was a year ago, maybe?

Stacey H. Dwyer

We typically run somewhere between about 60% and 70% participation from brokers.

Joel Locker - FBN Securities, Inc., Research Division

And has that changed at all or...

Stacey H. Dwyer

Not significantly.

Joel Locker - FBN Securities, Inc., Research Division

Not significantly. And just on community count, did you guys mention what it was up sequentially into up year-over-year?

Bill W. Wheat

Year-over-year was -- on active selling communities, was up 15%. I don't believe we gave the sequential number. That was ...

Donald J. Tomnitz

5%.

Bill W. Wheat

Yes, up 5% sequentially.

Joel Locker - FBN Securities, Inc., Research Division

5%. And just a follow-up on that. How much -- how many communities do you plan to open in the last 2 quarters of 2013? And what are slated to open in 2014, if you have some kind of ballpark figure.

Donald J. Tomnitz

We're planning on opening every community that meets our current underwriting guidelines, which is a combination of gross margin and return on capital. And I don't mean to not answer your question, but we are aggressively pursuing land and lot positions and most -- yes, every one of our markets. And to the extent that our conservative underwriting guidelines are met, we're on the deal. We do expect our selling communities to continue to be up 10% to 15% year-over-year for the remainder of this fiscal year. Past that, it's hard to have perfect visibility on timing of openings and closings. But just to clarify, we are approaching this upcycle in a totally different manner than we have in my 30 years with this company. And that is, we are adhering very closely to our return of initial investment on any land deal, that we'd get our capital back, our original investment back within 24 months. So some slight exceptions, but our goal is to maintain that hard and fast rule. And we're not having a hard time finding deals to meet those criteria today.

Joel Locker - FBN Securities, Inc., Research Division

Right. And then the Southwest, that was down 9% year-over-year on orders. Was that a function of just community count declining?

Donald J. Tomnitz

Yes, the Southwest, I think, we've mentioned the last quarter's call, with the vast improvement in the Phoenix market last year, our lot supply's a little lower than we would like. So we're working to build that back up. So our sales are reflecting that. But we're also seeing very strong pricing in that region as we rebuild our inventory.

Stacey H. Dwyer

And that's really, Chris, in terms of markets, that's Arizona and New Mexico for us.

Operator

Our next question is coming from Jack Micenko from SI G.

Jack Micenko - Susquehanna Financial Group, LLLP, Research Division

Stacey, going back to the mortgage question. I know you talked about timing and those closings rolling at the revenue recognition and the mortgage. Can you talk about sequential trends and the gain on sales margins in mortgage, and where you think those margins maybe go in the next quarters or so?

Stacey H. Dwyer

We've been in a very robust gain on sale environment. The demand side for the mortgage is where originating has increased. A large portion of our loans have been sold to one buyer for a long period of time. We're now seeing more buyers come in to the market and that is helping with the pricing. We don't know exactly where the margins will go. But it would -- might be a little aggressive to assume that they continue to stay exactly where they are, because this is above any historical margins we've ever ran, in terms of gain on sale.

Jack Micenko - Susquehanna Financial Group, LLLP, Research Division

But you didn't see a big decline, quarter-to-quarter?

Stacey H. Dwyer

No.

Donald J. Tomnitz

Okay. Right now, if you were investing in mortgages, I can't imagine a better time with the FICO scores, the underwriting guidelines and with low interest rates where they are today, very few prepayment -- early prepayment. So if you're an investor in mortgages, it's a great time to be in the business.

Jack Micenko - Susquehanna Financial Group, LLLP, Research Division

But not enough banks are doing it. Don, you had talked about -- continued to say and reiterate that you're not changing standards on land purchase side. We've heard some competitors talk about maybe moving in some inflation into their underwriter underwriting. I guess, the mix of almost half your win -- activity in this quarter was finished. Is that a sustainable percentage? And, I mean, going back to the '03, '04 timeframe, I mean, is that a consistent mix, finished versus raw, into sort of more building demand scenarios?

Mike Murray

I think that, that is a more normalized balance for us, about half developed, half -- we internally develop half. We might buy finish from someone else. And over the past few years, it had swung more to us buying finished lots as they were available through the stress and other situations. As we're getting back to a more normalized times, where we're developing more of our own lots. But it's not swinging the pendulum past what we believe to be a historical balance.

Bill W. Wheat

I think that's reflective of our geographic mix. We have a very strong presence in Texas, where there are third party developers, where there are finished lot opportunities really tied up throughout the south. there's a lot more opportunities there. So we typically have seen substantial amount of finished lot purchases in those markets.

Donald J. Tomnitz

I'll tell you, and with our volume in each one of our markets, we're assisting third party developers in terms of them taking their loans from banks because simply of the fact that, one, we have a strong balance sheet. And secondly, we are strong performer. We start the number of specs in each one of our communities. So there are a lot of third party developers who are seeking loans, that look at Horton as a great catalyst to them securing their loan from a bank.

Operator

Our next question is coming from Stephen Kim from Barclays.

Stephen Kim - Barclays Capital, Research Division

Congratulations on a good quarter. I wanted to...

Donald J. Tomnitz

Congratulations on a good call, timing wise.

I wanted to ask you a question about M&A. In the 1990s cycle, you all were really among the most successful M&A story in the industry. And recently, we've seen a little bit of activity from some of your peers on the M&A side getting into some markets here or there. And, I guess, I was just curious whether or not you felt that it was reasonable to think that D.R. Horton would be able to have M&A be a meaningful part of your growth opportunities over the next, say, 2 to 3 years?

Donald J. Tomnitz

Well, clearly, and I'll speak for him because he's sitting to my left, but Mike Murray is moved up to 38. He was our Controller and he was promoted to Senior Vice President. And he's in charge of our acquisitions for us. And clearly, if you recall, what was it? 4 months ago, 5 months ago, we've closed on Breland, which was a builder in Mobile and Gulf Port, Mississippi area, as well as Huntsville, Alabama. So he's working deals. We're working deals. And it's our goal to be a participant in the M&A game just as we were in the past upcycle.

Stephen Kim - Barclays Capital, Research Division

That's really helpful. Maybe just as a followup to that, can you give us a sense for what may be different about the way you're pursuing those deals, either in terms of the kinds of constraints you'll put, from your end or in terms of what embedded expectations are on the part of the folks on the other side of the table, relative to what you saw in the last cycle? You've indicated a lot of changes in the operations of your business. You just said you're doing things very differently in many ways in this upcycle operationally. Are there other differences on the M&A side as you look at things that are also relevant?

Donald J. Tomnitz

Before Mike gets into the facts, or all the other relationships, let me just say that our acquisition gain, one of the things, that's our preeminent plan, has always been that we are looking for people who will fit within our company and make sure that they blend well with us. And if you look at the people that we inherited from the Breland acquisition, there wasn't much "Hortonization" that was necessary, they fit within our organization very well and are performing very well. So that's our first plan. Our second plan is, is to make sure that they fill a hole where we currently need some help. And so I'll let Mike go in with the rest of it.

Mike Murray

And looking at our footprint, perhaps, today, versus where it was last when we went to the last round of M&A that concluded in, really in '02. Our footprint is much more robust today, and so there's less geographies that we'd be looking to fill in. Doesn't mean there's not places that we're existing today that might be attractive opportunity for us. Situation sometimes is seller motivated. They may have survived the last cycle very well, but they're looking for a way to take some of their capital out of play and a different lifestyle. Perhaps from where they are today. But as Don said, it's the people part, that's got to be first thing. And we are going to be focused on what we believe to be top to our people and, really, good long-term fits for us. I mean, we can grow a lot in laying positions in our markets. But to add some key talent, in key teams and, selectively, in new markets, there's opportunities.

Operator

Our next question is coming from Alex Barron from Housing Research Center.

Alex Barrón - Housing Research Center, LLC

I, as you know, have been following you guys for a long time, and I am kind of surprised by your conservatism in your guidance because it seems to me that everything's going on all cylinders. And so I'm just trying to understand if that's all that is behind your SG&A, your backlog conversion and your gross margin guidance?

Donald J. Tomnitz

Are you saying that gross margin guidance is light and our SG&A decreases are light?

Alex Barrón - Housing Research Center, LLC

Well, seems to me that the -- I mean, based on what you have on backlog going for you, and I know that you're not going to grow the SG&A, I mean, you've always watched it, it would seem to me you're going to get below, way below 11%, in the back half. But anyway...

Donald J. Tomnitz

Let me clearly say it. We didn't say how far below.

We talk clearly, Alex, about the fact that we still see gross margin expansion opportunities in the quarters ahead, especially in the next 3 quarters. And as, obviously, we get more of our closings in the second half of the year than the first half of the year, we see some declines in our SG&A as a percentage of revenue, moving forward. And that clearly, I think, our SG&A percentage in the second half of the year, will clearly be under 11%, and may approach 10% for the third and fourth quarter. But on an average for the year, based upon where we are today, it's not going to be -- it's probably going to be closer to 11%n than it's going to be closer to 10%. But it could be somewhere in between there, clearly.

Stacey H. Dwyer

Yes. And on backlog conversion, the 70% compared to what we had historically done in our third quarter, it's probably about 10% higher. We have seen our spec percentage come down a little bit as our percentage of inventory. So that's one of the things we're weighing. But quite honestly, we haven't been the perfect predictors of what our backlog conversion will be.

Bill W. Wheat

We've known that it would start reverting back to historical norms, but the predicting how quickly and how much, has been a little difficult. But we have seen a slower backlog conversion this year than last year. We expect that to continue to revert, that's within the guidance. Could we do better than 70%? Sure. But historically would say that we could do a little worse than that, too.

Donald J. Tomnitz

And please remember what I said in my prepared remarks, the second half of the year will be substantially better than the first half of the year for us, absolutely.

Alex Barrón - Housing Research Center, LLC

Right. So I guess, that kind of wants -- that makes me to ask why. I know you gave historical averages, the 20% gross margin and the 10% SG&A. But why would SG&A stay at 10%? Why couldn't it go below that in the future years, since you guys are obviously getting a lot of scale advantages and, as you pointed out, you don't need to hire that many incremental people to manage the growth in the units?

Donald J. Tomnitz

With all due respect, Alex, we're not focused on where our SG&A is going to be so much in the year, in '14 and '15 is where we are, and the next 2 quarters. So we're just focusing right now on delivering what we can very effectively deliver in the third and fourth quarters. And obviously, you know this organization, you know Don Horton very well. If we get to 10%, Horton will want 9%. And we'll be working on trying to get to 9%. But let's get to 10% first, before we have to make -- before you try to get us committed to where we're going to be in '14 and '15, sorry.

Alex Barrón - Housing Research Center, LLC

And if I could just ask on your land strategy. I go out and visit lot of communities around the country and it seems to me like you guys are the only ones kind of moving out to -- a lot of the first-time -- where the first-time buyers are. Your peers seem to be hesitating, are you finding that the opportunities and returns and the cost of land are more attractive than fighting for the A locations?

Donald J. Tomnitz

Well, actually, as we come through, as I said earlier in the conference call, Bill, Stacey and I see every deal that comes through the company. And one of us approves it, and I hear and see every deal. I would say to you that we are clearly still seeing a number of great opportunities in A locations. And most of the deals we're approving right now are A locations, based upon our gross margin hurdles as well as our return of initial capital. So I don't believe we're seeing -- I know one thing. We're not doing any C deals. So clearly, we're augmenting our A deals, which the majority of our deals are As, with some B deals, but we've got a high level of A deals coming to the corporation right now.

Bill W. Wheat

There's strong buyer demand in a sub market at margins that meet our hurdles, that's an A deal for us.

Operator

Our next question is coming from Megan McGrath from MKM Partners.

Megan McGrath - MKM Partners LLC, Research Division

Just wanted to ask a little bit about pricing and affordability. We've -- you got pricing going up a couple percentage points, but at least according to data this morning, we've got real incomes down about 5%. So obviously, all of that mortgage rates' here, how much wiggle room do you think that you still have on the pricing, especially with your first-time buyer? What are you hearing from your sales folks in terms of how much they can push it in terms of affordability here?

Donald J. Tomnitz

Well, as we look across the country, frankly, we're selling, more and more, larger plans, as our sales price indicates and our square footage indicates. And frankly, in a number of our markets, we're in the leading the smallest 2 plans, simply because of the fact that we have much better margins than the third largest small plan, and going up the scale so -- I don't see any issues with that currently and I know that, that's an issue because, obviously, with the increased taxes that everyone's having to pay this year, there is less disposable income. But we still have people who largely come in into our models, especially in the first-time homebuyer market. With the affordability rates where they are today, even though they may not be as great as they once were, but they're still very good. they're still trying to buy all house they possibly can. That's something we always have to watch, always watch the affordability. But today, it's still very good. And then especially with where mortgage standards are today, for those buyers that are able to qualify for a mortgage, they have very, very good credit quality. So they're typically able -- probably to afford a little bit more house than buyers several years ago, when credit standards were a little different.

Bill W. Wheat

When we're dropping our 1 or 2 smallest plans on a number of our communities, there's good demand out there. So to the extent that we're dropping those, to the extent we have come back and add those because of less disposable income or qualifying problems, we can easily do that.

Megan McGrath - MKM Partners LLC, Research Division

Okay, great. That's helpful. And then, just to follow up on your comment around financing. We actually heard, in a couple of instances, that now that prices are going up, that appraisers are falling behind a little bit and having a hard time catching up. Has that been any pushback for you in the quarter, in terms of appraisers catching up with your price increases?

Donald J. Tomnitz

Actually, we work very closely, to the extent that we can, with our appraisers. And we try to help them by having a focal person in each division, deliver the appraisal packet. And to the extent that they can use any of our help, we're trying to help them. But clearly, I think, the appraisers are doing a good job in most of our markets. There are a handful of markets where we go like that the appraisers are not giving the value that we should be getting for our homes, but we're working through that.

Operator

Our final question today is coming from Buck Horne from Raymond James.

Buck Horne - Raymond James & Associates, Inc., Research Division

A quick one here. Can you quantify any external commissions that were on the gross margin line? And, I guess, also, are there any markets where you're actively trying to slow absorption, given the laying constraints out there? And how do you balance the equation between price and pace right now?

Donald J. Tomnitz

I'll take the second half of that. We're not trying to slow our sales in any particular market by lack of lot supply. If we are doing anything, and our sales are slowing in a particular area it's because we're very proactive on our price increases. And we're trying to take price increases wherever we can and as actively as we can, but not any restriction on our sales, relative to land and lot supply.

Bill W. Wheat

And commissions over the long term are typically around 3% of revenue for us, and this quarter was in line with that long term range.

Buck Horne - Raymond James & Associates, Inc., Research Division

Okay. great. One, just last one, in the call here. But -- can you talk a little bit about the margin differential between internally developed communities versus communities you buy from third parties? What's the margin differential between those, typically? And on the finished lots you do buy today, what's the implied margin relative to your current 20%?

Donald J. Tomnitz

It's really a risk assessment. And basically, if we are buying lots, all cash, from a third-party developer, more if we have bought the land and are developing the lots, we have a higher gross margin underwriting hurdle than our standard, on a rolling option basis. That could be anywhere from 200 to 300 to 400 basis points differential. Because we believe that, as we cap the cash something now, or in terms of finished lots, or if we develop the subdivision ourselves, we should be paying ourselves a risk-adjusted return. And if we're not, then we're making a mistake. So that's where we focus. And sometimes it's 500 basis points, but I'd say, it's typically somewhere between 300 and 400 basis points, if we have to cash something out.

Operator

We have reached the end of our question-and-answer session. I'd like to turn the floor back over to management for any further or closing comments.

Donald J. Tomnitz

Thank you. And thank our employees for a wonderful quarter. We've come through a tough 5 years in this -- in the company. We've rebuilt the company from the ground up. Our employees have done a phenomenal job out there, helping us get to where we are . Without a doubt, we're clearly the leader in the industry, and where we are today and where we are positioned, over the course of the next 2 years, we should clearly be the leader in the industry, both on units, revenues, profit, gross margins, SG&A. We absolutely had a phenomenal quarter, but there's more great things to come with this company. And I appreciate it, and D.R. and I thank each and every one of our employees. Goodbye.

Operator

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time and have a wonderful day. We thank you for your participation today.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: DR Horton Management Discusses Q2 2013 Results - Earnings Call Transcript
This Transcript
All Transcripts