WESTLAKE VILLAGE, Calif.--(BUSINESS WIRE)-- The Ryland Group, Inc. (NYSE: RYL), today announced results for its quarter ended June 30, 2012. Items of note included:

• Net income from continuing operations totaled $6.0 million, or $0.14 per diluted share, for the quarter ended June 30, 2012;
• New orders increased 41.6 percent to 1,398 units for the second quarter of 2012 from 987 units for the second quarter of 2011. For the second quarter of 2012, new order dollars rose 52.8 percent to $380.3 million from $248.8 million for the same period in 2011;
• Closings rose 35.6 percent to 1,115 units for the quarter ended June 30, 2012, compared to 822 units for the same period in the prior year;
• Backlog increased 47.0 percent to 2,277 units at June 30, 2012, from 1,549 units at June 30, 2011;
• Active communities rose to 209 communities at June 30, 2012, from 202 communities at June 30, 2011;
• Revenues totaled $293.8 million for the quarter ended June 30, 2012, representing a 38.7 percent increase from $211.8 million for the quarter ended June 30, 2011;
• Average closing price increased to $254,000 for the quarter ended June 30, 2012, from $248,000 for the same period in 2011;
• Housing gross profit margin was 18.7 percent for the second quarter of 2012, compared to 15.0 percent for the same period in the prior year;
• Issuance of $225.0 million of 1.6 percent convertible senior notes due May 2018 during the second quarter of 2012 and July 2012 redemption of $167.2 million of 6.9 percent senior notes due June 2013;
• Selling, general and administrative and corporate expense totaled 16.3 percent of homebuilding revenues for the second quarter of 2012, compared to 17.7 percent for the second quarter of 2011;
• Cash, cash equivalents and marketable securities totaled $732.9 million at June 30, 2012; and
• Net debt-to-capital ratio was 40.9 percent at June 30, 2012, compared to 36.7 percent at December 31, 2011. (Net debt-to-capital ratio is calculated as debt, net of cash, cash equivalents and marketable securities, divided by the sum of debt and total stockholders equity, net of cash, cash equivalents and marketable securities.)

RESULTS FOR THE SECOND QUARTER OF 2012

For the quarter ended June 30, 2012, the Company reported net income of $6.0 million, or $0.14 per diluted share, compared to a net loss of $9.8 million, or $0.22 per diluted share, for the same period in 2011. Pretax charges that related to inventory and other valuation adjustments totaled $385,000, or $0.01 per diluted share, and $5.8 million, or $0.13 per diluted share, for the quarters ended June 30, 2012 and 2011, respectively. Additionally, the Company had a pretax charge of $857,000 that related to a debt repurchase during the quarter ended June 30, 2011.

The homebuilding segments reported pretax earnings of $9.9 million for the second quarter of 2012, compared to a pretax loss of $7.4 million for the same period in 2011. This increase was primarily due to a rise in closing volume; higher housing gross profit margin, including lower inventory and other valuation adjustments; a decline in interest expense; and a reduced selling, general and administrative expense ratio.

Homebuilding revenues increased 38.9 percent to $284.6 million for the second quarter of 2012, compared to $204.9 million for the same period in 2011. This rise in homebuilding revenues was primarily attributable to a 35.6 percent increase in closings that totaled 1,115 units for the quarter ended June 30, 2012, compared to 822 units for the same period in the prior year. For the quarter ended June 30, 2012, the average closing price of a home increased 2.4 percent to $254,000 from $248,000 for the same period in 2011. Homebuilding revenues for the second quarter of 2012 included $947,000 from land sales, which resulted in pretax earnings of $330,000, compared to homebuilding revenues for the second quarter of 2011 that included $1.2 million from land sales, which resulted in a pretax loss of $160,000.

New orders increased 41.6 percent to 1,398 units for the quarter ended June 30, 2012, compared to new orders of 987 units for the same period in 2011. The Company had an average monthly sales absorption rate of 2.2 homes per community for the quarter ended June 30, 2012, versus 1.6 homes per community for the quarter ended June 30, 2011, and an average cancellation rate of 20.0 percent for the quarter ended June 30, 2012, versus 20.7 percent for the same period in 2011. For the second quarter of 2012, new order dollars increased 52.8 percent to $380.3 million from $248.8 million for the second quarter of 2011. At June 30, 2012, backlog increased 47.0 percent to 2,277 units from 1,549 units at June 30, 2011. For the second quarter of 2012, the dollar value of the Companys backlog was $614.8 million, reflecting a 55.2 percent rise from the same period in the prior year.

Housing gross profit margin was 18.7 percent, excluding inventory valuation adjustments, for the quarter ended June 30, 2012, compared to 16.9 percent for the quarter ended June 30, 2011. Including inventory valuation adjustments, housing gross profit margin was 18.7 percent for the second quarter of 2012, compared to 15.0 percent for the second quarter of 2011. This improvement in housing gross profit margin was primarily attributable to a decline in land and direct construction costs; lower inventory and other valuation adjustments; higher leverage of direct overhead expense due to an increase in the number of homes delivered; and reduced sales incentives and price concessions. For the second quarter of 2012, sales incentives and price concessions totaled 10.4 percent, compared to 11.6 percent for the same period in 2011.

Selling, general and administrative expense totaled 13.8 percent of homebuilding revenues for the second quarter of 2012, compared to 15.3 percent for the second quarter of 2011. This decrease in the selling, general and administrative expense ratio was primarily attributable to higher leverage resulting from increased revenues, as well as to cost-saving initiatives.

The homebuilding segments recorded $4.2 million of interest expense during the second quarter of 2012, compared to $4.7 million during the second quarter of 2011. This decrease in interest expense from the second quarter of 2011 was primarily due to the capitalization of a greater amount of interest incurred during the second quarter of 2012, which resulted from a higher level of inventory-under-development, partially offset by $467,000 of interest expense from the issuance of 1.6 percent convertible senior notes in May 2012. See the subsequent event discussion included on page five of this release for information regarding the July 2012 redemption of $167.2 million of the Companys 6.9 percent senior notes due June 2013.

Corporate expense totaled $7.1 million for the quarter ended June 30, 2012, compared to $4.9 million for the same period in 2011. This increase was due, in part, to fluctuations in the Companys stock price that impacted compensation expense, partially offset by lower operating expenses.

During the second quarter of 2012, the Company used $44.9 million of cash for operating activities, used $21.0 million of cash for investing activities and provided $225.0 million from the issuance of 1.6 percent convertible senior notes and $18.9 million from other financing activities.

For the quarter ended June 30, 2012, the financial services segment reported pretax earnings of $2.9 million, compared to $2.1 million for the same period in 2011. This improvement was primarily attributable to an increase in locked pipeline and origination volumes and to higher title income, partially offset by increased legal and personnel expenses and by interest related to the financial services credit facility that was entered into during December 2011.

The Companys net income from discontinued operations totaled $223,000 for the quarter ended June 30, 2012, compared to a net loss of $912,000 for the same period in 2011.

RESULTS FOR THE FIRST SIX MONTHS OF 2012

For the six months ended June 30, 2012, the Company reported net income of $3.0 million, or $0.07 per diluted share, compared to a net loss of $27.2 million, or $0.61 per diluted share, for the same period in 2011. Pretax charges that related to inventory and other valuation adjustments totaled $2.5 million, or $0.05 per diluted share, and $14.9 million, or $0.34 per diluted share, for the six months ended June 30, 2012 and 2011, respectively. Additionally, the Company had a pretax charge of $857,000 that related to a debt repurchase during the six months ended June 30, 2011.

The homebuilding segments reported pretax earnings of $11.0 million for the first six months of 2012, compared to a pretax loss of $24.8 million for the same period in 2011. This increase was primarily due to a rise in closing volume; higher housing gross profit margin, including lower inventory and other valuation adjustments; a decline in interest expense; and a reduced selling, general and administrative expense ratio.

Homebuilding revenues increased 34.9 percent to $494.1 million for the first six months of 2012, compared to $366.4 million for the same period in 2011. This rise in homebuilding revenues was primarily attributable to a 31.1 percent increase in closings that totaled 1,930 units for the six-month period ended June 30, 2012, compared to 1,472 units for the same period in the prior year. For the six months ended June 30, 2012, the average closing price of a home increased 2.8 percent to $255,000 from $248,000 for the same period in 2011. Homebuilding revenues for the first six months of 2012 included $1.7 million from land sales, which resulted in pretax earnings of $629,000, compared to homebuilding revenues for the first six months of 2011 that included $1.4 million from land sales, which resulted in a pretax loss of $144,000.

New orders increased 43.9 percent to 2,726 units for the six months ended June 30, 2012, compared to new orders of 1,894 units for the same period in 2011. The Company had an average monthly sales absorption rate of 2.2 homes per community for the six months ended June 30, 2012, versus 1.6 homes per community for the six months ended June 30, 2011, and an average cancellation rate of 19.0 percent for the six months ended June 30, 2012, versus 19.5 percent for the same period in 2011. For the first six months of 2012, new order dollars increased 52.4 percent to $725.5 million from $476.2 million for the first six months of 2011.

Housing gross profit margin was 18.6 percent, excluding inventory valuation adjustments, for the six months ended June 30, 2012, compared to 17.0 percent for the six months ended June 30, 2011. Including inventory valuation adjustments, housing gross profit margin was 18.2 percent for the first six months of 2012, compared to 15.1 percent for the first six months of 2011. This improvement in housing gross profit margin was primarily attributable to a decline in land and direct construction costs; lower inventory and other valuation adjustments; higher leverage of direct overhead expense due to an increase in the number of homes delivered; and reduced sales incentives and price concessions. For the first six months of 2012, sales incentives and price concessions totaled 10.6 percent, compared to 11.6 percent for the same period in 2011.

Selling, general and administrative expense totaled 14.5 percent of homebuilding revenues for the first six months of 2012, compared to 16.9 percent for the first six months of 2011. This decrease in the selling, general and administrative expense ratio was primarily attributable to higher leverage resulting from increased revenues, as well as to cost-saving initiatives.

The homebuilding segments recorded $7.7 million of interest expense during the first six months of 2012, compared to $10.5 million during the first six months of 2011. This decrease in interest expense from the first six months of 2011 was primarily due to the capitalization of a greater amount of interest incurred during the first six months of 2012, which resulted from a higher level of inventory-under-development, partially offset by interest expense from the aforementioned convertible senior notes issued in May 2012. See the subsequent event discussion of this release for information regarding the July 2012 redemption of $167.2 million of the Companys 6.9 percent senior notes due June 2013.

Corporate expense totaled $12.3 million for the six months ended June 30, 2012, compared to $9.9 million for the same period in 2011. This increase was due, in part, to fluctuations in the Companys stock price that impacted compensation expense, partially offset by lower operating expenses.

For the six-month period ended June 30, 2012, the financial services segment reported pretax earnings of $3.6 million, compared to $3.3 million for the same period in 2011. This improvement was primarily attributable to an increase in locked pipeline and origination volumes and to higher title income, partially offset by increased personnel and legal expenses and by interest related to the financial services credit facility that was entered into during December 2011.

The Companys net loss from discontinued operations totaled $1.9 million, or $0.04 per diluted share, for the six-month period ended June 30, 2012, which included a pretax charge of $1.4 million, or $0.03 per diluted share, related to inventory valuation adjustments, compared to a net loss of $3.0 million, or $0.07 per diluted share, for the same period in 2011.

DEBT ISSUANCE

In May 2012, the Company issued $225.0 million aggregate principal amount of its 1.6 percent convertible senior notes due May 2018. $177.2 million of the proceeds was used to redeem and repurchase all of the 6.9 percent senior notes due June 2013. The remaining proceeds will be used for general corporate purposes.

SUBSEQUENT EVENTDEBT REDEMPTION AND REPURCHASE

In July 2012, the Company paid $177.2 million to redeem and repurchase all of the 6.9 percent senior notes, which were due June 2013 and totaled $167.2 million.

Headquartered in Southern California, Ryland (RYL) is one of the nations largest homebuilders and a leading mortgage-finance company. Since its founding in 1967, Ryland has built more than 295,000 homes and financed more than 245,000 mortgages. The Company currently operates in 13 states across the country and is listed on the New York Stock Exchange under the symbol RYL. For more information, please visit www.ryland.com.

Note: Certain statements in this press release may be regarded as forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, and may qualify for the safe harbor provided for in Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent the Companys expectations and beliefs concerning future events, and no assurance can be given that the future results described in this press release will be achieved. These forward-looking statements can generally be identified by the use of statements that include words such as anticipate, believe, could, estimate, expect, foresee, goal, intend, likely, may, plan, project, should, target, will or other similar words or phrases. All forward-looking statements contained herein are based upon information available to the Company on the date of this press release. Except as may be required under applicable law, the Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Companys control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. The factors and assumptions upon which any forward-looking statements herein are based are subject to risks and uncertainties which include, among others:

• economic changes nationally or in the Companys local markets, including volatility and increases in interest rates, the impact of, and changes in, governmental stimulus, tax and deficit reduction programs, inflation, changes in consumer demand and confidence levels and the state of the market for homes in general;
• changes and developments in the mortgage lending market, including revisions to underwriting standards for borrowers and lender requirements for originating and holding mortgages, changes in government support of and participation in such market, and delays or changes in terms and conditions for the sale of mortgages originated by the Company;
• the availability and cost of land and the future value of land held or under development;
• increased land development costs on projects under development;
• shortages of skilled labor or raw materials used in the production of homes;
• increased prices for labor, land and materials used in the production of homes;
• increased competition, including continued competition and price pressure from distressed home sales;
• failure to anticipate or react to changing consumer preferences in home design;
• increased costs and delays in land development or home construction resulting from adverse weather conditions or other factors;
• potential delays or increased costs in obtaining necessary permits as a result of changes to laws, regulations or governmental policies (including those that affect zoning, density, building standards, the environment and the residential mortgage industry);
• delays in obtaining approvals from applicable regulatory agencies and others in connection with the Companys communities and land activities;
• changes in the Companys effective tax rate and assumptions and valuations related to its tax accounts;
• the risk factors set forth in the Companys most recent Annual Report on Form 10-K; and
• other factors over which the Company has little or no control.

THE RYLAND GROUP, INC. and Subsidiaries
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
(in thousands, except share data)
				Three months ended June 30,							Six months ended June 30,
					2012			2011				2012				2011
REVENUES
	Homebuilding			$	284,593		$	204,925			$	494,128			$	366,353
	Financial services				9,176			6,923				15,510				13,167
		TOTAL REVENUES			293,769			211,848				509,638				379,520
EXPENSES
	Cost of sales				231,130			176,226				403,820				318,690
	Selling, general and administrative				39,368			31,349				71,576				61,893
	Financial services				6,232			4,859				11,921				9,894
	Corporate				7,139			4,925				12,319				9,912
	Interest				4,180			4,735				7,749				10,522
		TOTAL EXPENSES			288,049			222,094				507,385				410,911
OTHER INCOME
	Gain from marketable securities, net				519			1,302				965				2,610
	Loss related to early retirement of debt, net				-			(857	)			-				(857	)
		TOTAL OTHER INCOME			519			445				965				1,753
Income (loss) from continuing operations before taxes					6,239			(9,801	)			3,218				(29,638	)
Tax expense (benefit)					190			-				190				(2,398	)
NET INCOME (LOSS) FROM CONTINUING OPERATIONS					6,049			(9,801	)			3,028				(27,240	)
Income (loss) from discontinued operations, net of taxes					223			(912	)			(1,864	)			(3,009	)
NET INCOME (LOSS)				$	6,272		$	(10,713	)		$	1,164			$	(30,249	)
NET INCOME (LOSS) PER COMMON SHARE
	Basic
		Continuing operations		$	0.14		$	(0.22	)		$	0.07			$	(0.61	)
		Discontinued operations			0.00			(0.02	)			(0.04	)			(0.07	)
		Total			0.14			(0.24	)			0.03				(0.68	)
	Diluted
		Continuing operations			0.14			(0.22	)			0.07				(0.61	)
		Discontinued operations			0.00			(0.02	)			(0.04	)			(0.07	)
		Total		$	0.14		$	(0.24	)		$	0.03			$	(0.68	)
AVERAGE COMMON SHARES
OUTSTANDING
	Basic				44,627,548			44,368,874				44,551,441				44,303,958
	Diluted				48,570,825			44,368,874				44,938,772				44,303,958

THE RYLAND GROUP, INC. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
					June 30, 2012			December 31, 2011
					(Unaudited)
ASSETS
	Cash, cash equivalents and marketable securities
		Cash and cash equivalents			$	355,212		$	159,363
		Restricted cash				67,060			56,799
		Marketable securities, available-for-sale				310,638			347,016
		Total cash, cash equivalents and marketable securities				732,910			563,178
	Housing inventories
		Homes under construction				419,557			319,476
		Land under development and improved lots				412,034			413,569
		Inventory held-for-sale				7,750			11,015
		Consolidated inventory not owned				47,302			51,400
		Total housing inventories				886,643			795,460
	Property, plant and equipment					20,012			19,920
	Other					153,732			165,262
	Assets of discontinued operations					14,624			35,324
		TOTAL ASSETS				1,807,921			1,579,144
LIABILITIES
	Accounts payable					86,231			74,327
	Accrued and other liabilities					136,026			140,930
	Financial services credit facility					50,271			49,933
	Debt					1,047,856			823,827
	Liabilities of discontinued operations					1,863			6,217
		TOTAL LIABILITIES				1,322,247			1,095,234
EQUITY
	STOCKHOLDERS' EQUITY
		Preferred stock, $1.00 par value:
			Authorized10,000 shares Series A Junior
			Participating Preferred, none outstanding			-			-
		Common stock, $1.00 par value:
			Authorized199,990,000 shares
			Issued44,660,496 shares at June 30, 2012
			(44,413,594 shares at December 31, 2011)			44,660			44,414
		Retained earnings				410,043			405,109
		Accumulated other comprehensive income				711			164
		TOTAL STOCKHOLDERS' EQUITY
			FOR THE RYLAND GROUP, INC.			455,414			449,687
	NONCONTROLLING INTEREST					30,260			34,223
		TOTAL EQUITY				485,674			483,910
		TOTAL LIABILITIES AND EQUITY			$	1,807,921		$	1,579,144

THE RYLAND GROUP, INC. and Subsidiaries
SEGMENT INFORMATION (Unaudited)
					Three months ended June 30,								Six months ended June 30,
						2012				2011				2012				2011
EARNINGS (LOSS) BEFORE TAXES (in thousands)
	Homebuilding
		North			$	1,796			$	(4,737	)		$	174			$	(10,225	)
		Southeast				2,497				(4,215	)			3,388				(12,626	)
		Texas				4,784				3,438				8,309				1,777
		West				838				(1,871	)			(888	)			(3,678	)
	Financial services					2,944				2,064				3,589				3,273
	Corporate and unallocated					(6,620	)			(4,480	)			(11,354	)			(8,159	)
	Discontinued operations					223				(912	)			(1,864	)			(3,009	)
			Total		$	6,462			$	(10,713	)		$	1,354			$	(32,647	)
NEW ORDERS
	Units
		North				383				314				794				632
		Southeast				437				335				854				580
		Texas				335				267				708				538
		West				243				71				370				144
		Discontinued operations				17				78				46				137
			Total			1,415				1,065				2,772				2,031
	Dollars (in millions)
		North			$	114			$	84			$	230			$	170
		Southeast				107				69				200				123
		Texas				89				71				184				138
		West				70				25				111				45
		Discontinued operations				5				17				11				28
			Total		$	385			$	266			$	736			$	504
CLOSINGS
	Units
		North				316				277				540				487
		Southeast				354				218				619				413
		Texas				316				271				560				463
		West				129				56				211				109
		Discontinued operations				34				62				67				100
			Total			1,149				884				1,997				1,572
	Average closing price (in thousands)
		North			$	272			$	271			$	274			$	268
		Southeast				221				213				218				219
		Texas				248				250				253				247
		West				317				259				322				275
		Discontinued operations				223				206				216				199
			Total		$	253			$	245			$	254			$	245
OUTSTANDING CONTRACTS													June 30,
	Units													2012				2011
		North												674				482
		Southeast												756				504
		Texas												581				475
		West												266				88
		Discontinued operations												12				97
			Total											2,289				1,646
	Dollars (in millions)
		North											$	203			$	134
		Southeast												176				107
		Texas												155				125
		West												81				30
		Discontinued operations												3				20
			Total										$	618			$	416
	Average price (in thousands)
		North											$	302			$	279
		Southeast												233				211
		Texas												266				263
		West												303				345
		Discontinued operations												272				209
			Total										$	270			$	253

THE RYLAND GROUP, INC. and Subsidiaries
FINANCIAL SERVICES SUPPLEMENTAL INFORMATION (Unaudited)
(in thousands, except origination data)
				Three months ended June 30,								Six months ended June 30,
RESULTS OF OPERATIONS					2012				2011				2012				2011
	REVENUES
		Income from origination and sale of mortgage loans, net		$	7,102			$	5,262			$	11,726			$	10,136
		Title, escrow and insurance			1,737				1,483				3,001				2,728
		Interest and other			337				178				783				303
		TOTAL REVENUES			9,176				6,923				15,510				13,167
	EXPENSES				6,232				4,859				11,921				9,894
	PRETAX EARNINGS			$	2,944			$	2,064			$	3,589			$	3,273
OPERATIONAL DATA
	Retail operations:
		Originations (units)			747				655				1,299				1,172
		Ryland Homes originations as a
		percentage of total originations			100.0	%			100.0	%			100.0	%			100.0	%
		Ryland Homes origination capture rate			69.8	%			78.6	%			70.9	%			79.5	%
OTHER CONSOLIDATED SUPPLEMENTAL INFORMATION (Unaudited)
(in thousands)				Three months ended June 30,								Six months ended June 30,
					2012				2011				2012				2011
Interest incurred				$	14,926			$	14,133			$	29,107			$	28,722
Interest capitalized during the period					10,524				9,397				20,777				18,198
Amortization of capitalized interest included in cost of sales					9,813				7,617				17,632				13,291
Depreciation and amortization					3,432				2,838				6,433				5,423

THE RYLAND GROUP, INC. and Subsidiaries
NON-GAAP FINANCIAL DISCLOSURE RECONCILIATION
(in thousands)
				Three months ended June 30,						Six months ended June 30,
					2012			2011			2012			2011
HOUSING GROSS MARGINS
	HOUSING REVENUES			$	283,646		$	203,737		$	492,469		$	364,974
	LAND AND OTHER REVENUES				947			1,188			1,659			1,379
		TOTAL HOMEBUILDING REVENUES			284,593			204,925			494,128			366,353
	HOUSING COST OF SALES
		Cost of sales			230,492			169,358			400,879			302,765
		Valuation adjustments and write-offs			21			3,864			1,911			7,136
		TOTAL HOUSING COST OF SALES			230,513			173,222			402,790			309,901
	LAND AND OTHER COST OF SALES
		Cost of sales			617			1,348			1,030			1,523
		Valuation adjustments and write-offs			-			1,656			-			7,266
		TOTAL LAND COST OF SALES			617			3,004			1,030			8,789
		TOTAL HOMEBUILDING COST OF SALES			231,130			176,226			403,820			318,690
	HOUSING GROSS MARGINS			$	53,133		$	30,515		$	89,679		$	55,073
	HOUSING GROSS MARGIN PERCENTAGE				18.7	%		15.0	%		18.2	%		15.1	%
		HOUSING GROSS MARGINS, excluding inventory valuation adjustments and write-offs		$	53,154		$	34,379		$	91,590		$	62,209
		HOUSING GROSS MARGIN PERCENTAGE, excluding inventory valuation adjustments and write-offs			18.7	%		16.9	%		18.6	%		17.0	%

Gross margins on home sales, excluding inventory valuation adjustments, is a non-GAAP financial measure and is defined by the Company as revenue from home sales less costs of homes sold, excluding the Company's inventory valuation adjustments recorded during the period. Management finds this to be a useful measure in evaluating the Companys performance because it discloses the profit the Company generates on homes it actually delivered during the period, as the inventory valuation adjustments relate, in part, to inventory that was not delivered during the period. It assists the Companys management in making strategic decisions regarding its construction pace, product mix and product pricing based upon the profitability it generated on homes the Company currently delivers or sells. The Company believes investors will also find gross margins on home sales, excluding inventory valuation adjustments, to be important and useful because it discloses a profitability measure that can be compared to a prior period without regard to the variability of inventory valuation adjustments. In addition, to the extent that the Companys competitors provide similar information, disclosure of its gross margins on home sales, excluding inventory valuation adjustments, helps readers of the Companys financial statements compare profits to its competitors with regard to the homes they deliver in the same period. In addition, because gross margins on home sales is a financial measure that is not calculated in accordance with GAAP, it may not be completely comparable to similarly titled measures of the Companys competitors due to potential differences in methods of calculation and charges being excluded.

The Ryland Group, Inc.
Drew Mackintosh, VP, Investor Relations and Corporate Communications
(805) 367-3722

Source: The Ryland Group, Inc.

Copyright Business Wire 2012