TRI POINTE GROUP, INC., 10-Q filed on 11/6/2015
Quarterly Report
Document and Entity Information
9 Months Ended
Sep. 30, 2015
Nov. 1, 2015
Document And Entity Information [Abstract]
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Sep. 30, 2015 
 
Document Fiscal Year Focus
2015 
 
Document Fiscal Period Focus
Q3 
 
Trading Symbol
TPH 
 
Entity Registrant Name
TRI Pointe Group, Inc. 
 
Entity Central Index Key
0001561680 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
161,813,750 
Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Assets
 
 
Cash and cash equivalents
$ 96,993 
$ 170,629 
Receivables
32,921 
20,118 
Real estate inventories
2,576,402 
2,280,183 
Investments in unconsolidated entities
17,340 
16,805 
Goodwill and other intangible assets, net
162,162 
162,563 
Deferred tax assets
141,479 
157,821 
Other assets
84,516 
105,405 
Total assets
3,111,813 
2,913,524 
Liabilities
 
 
Accounts payable
67,747 
68,860 
Accrued expenses and other liabilities
210,707 
210,009 
Unsecured revolving credit facility
349,392 
260,000 
Seller financed loans
7,572 
14,677 
Senior notes
888,657 
887,502 
Total liabilities
1,524,075 
1,441,048 
Commitments and contingencies (Note 15)
   
   
Stockholders’ Equity:
 
 
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued and outstanding as of September 30, 2015 and December 31, 2014, respectively
   
   
Common stock, $0.01 par value, 500,000,000 shares authorized; 161,813,750 and 161,355,490 shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively
1,618 
1,614 
Additional paid-in capital
907,762 
906,159 
Retained earnings
666,796 
546,407 
Total stockholders’ equity
1,576,176 
1,454,180 
Noncontrolling interests
11,562 
18,296 
Total equity
1,587,738 
1,472,476 
Total liabilities and equity
$ 3,111,813 
$ 2,913,524 
Consolidated Balance Sheets (Parenthetical) (USD $)
Sep. 30, 2015
Dec. 31, 2014
Statement Of Financial Position [Abstract]
 
 
Preferred stock, par value
$ 0.01 
$ 0.01 
Preferred stock, shares authorized
50,000,000 
50,000,000 
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, shares authorized
500,000,000 
500,000,000 
Common stock, shares issued
161,813,750 
161,355,490 
Common stock, shares outstanding
161,813,750 
161,355,490 
Consolidated Statements of Operations (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Revenues:
 
 
 
 
Home sales
$ 642,352 
$ 471,801 
$ 1,443,855 
$ 1,023,312 
Land and lot sales
4,876 
5,550 
74,366 
36,449 
Other operations
913 
569 
2,695 
8,854 
Total revenues
648,141 
477,920 
1,520,916 
1,068,615 
Expenses:
 
 
 
 
Cost of home sales
507,543 
385,400 
1,149,191 
819,377 
Cost of land and lot sales
3,451 
2,317 
17,324 
30,245 
Other operations
570 
556 
1,724 
2,755 
Sales and marketing
30,038 
28,393 
78,958 
73,096 
General and administrative
26,783 
20,951 
83,261 
57,140 
Restructuring charges
2,010 
7,024 
2,730 
9,202 
Total expenses
570,395 
444,641 
1,333,188 
991,815 
Income from operations
77,746 
33,279 
187,728 
76,800 
Equity in loss of unconsolidated entities
(3)
(82)
(84)
(219)
Transaction expenses
 
(16,710)
 
(17,216)
Other income (loss), net
47 
499 
272 
(242)
Income before taxes
77,790 
16,986 
187,916 
59,123 
Provision for income taxes
(28,021)
(6,021)
(66,088)
(16,352)
Net income
49,769 
10,965 
121,828 
42,771 
Net (income) loss attributable to noncontrolling interests
393 
 
(1,439)
 
Net income available to common stockholders
$ 50,162 
$ 10,965 
$ 120,389 
$ 42,771 
Earnings per share
 
 
 
 
Basic
$ 0.31 
$ 0.07 
$ 0.74 
$ 0.31 
Diluted
$ 0.31 
$ 0.07 
$ 0.74 
$ 0.31 
Weighted average shares outstanding
 
 
 
 
Basic
161,772,893 
158,931,450 
161,651,177 
139,550,891 
Diluted
162,366,744 
159,158,706 
162,299,282 
140,213,655 
Consolidated Statements of Equity (USD $)
In Thousands, except Share data
Total
Common Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
TRI Pointe [Member]
Noncontrolling Interests [Member]
Beginning Balance at Dec. 31, 2013
$ 825,517 
$ 1,297 
$ 333,589 
$ 462,210 
$ 797,096 
$ 28,421 
Beginning Balance, Shares at Dec. 31, 2013
 
129,700,000 
 
 
 
 
Net income
84,197 
 
 
84,197 
84,197 
 
Capital contribution by Weyerhaeuser, net
63,355 
 
63,355 
 
63,355 
 
Common shares issued in connection with the Merger (Note 2)
498,973 
317 
498,656 
 
498,973 
 
Common shares issued in connection with the Merger (Note 2), Shares
 
31,632,533 
 
 
 
 
Shares issued under share-based awards
176 
 
176 
 
176 
 
Shares issued under share-based awards, Shares
 
22,957 
 
 
 
 
Excess tax benefit of share-based awards, net
1,757 
 
1,757 
 
1,757 
 
Stock-based compensation expense
8,626 
 
8,626 
 
8,626 
 
Distributions to noncontrolling interests, net
(17,248)
 
 
 
 
(17,248)
Net effect of consolidations, de-consolidations and other transactions
7,123 
 
 
 
 
7,123 
Ending Balance at Dec. 31, 2014
1,472,476 
1,614 
906,159 
546,407 
1,454,180 
18,296 
Ending Balance, Shares at Dec. 31, 2014
161,355,490 
161,355,490 
 
 
 
 
Net income
121,828 
 
 
120,389 
120,389 
1,439 
Capital contribution by Weyerhaeuser, net
(6,747)
 
(6,747)
 
(6,747)
 
Shares issued under share-based awards
1,616 
1,612 
 
1,616 
 
Shares issued under share-based awards, Shares
 
458,260 
 
 
 
 
Excess tax benefit of share-based awards, net
392 
 
392 
 
392 
 
Minimum tax withholding paid on behalf of employees for restricted stock units
(2,190)
 
(2,190)
 
(2,190)
 
Stock-based compensation expense
8,536 
 
8,536 
 
8,536 
 
Distributions to noncontrolling interests, net
(4,917)
 
 
 
 
(4,917)
Net effect of consolidations, de-consolidations and other transactions
(3,256)
 
 
 
 
(3,256)
Ending Balance at Sep. 30, 2015
$ 1,587,738 
$ 1,618 
$ 907,762 
$ 666,796 
$ 1,576,176 
$ 11,562 
Ending Balance, Shares at Sep. 30, 2015
161,813,750 
161,813,750 
 
 
 
 
Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Cash flows from operating activities
 
 
Net income
$ 121,828 
$ 42,771 
Adjustments to reconcile net income to net cash used in operating activities:
 
 
Depreciation and amortization
5,416 
10,578 
Equity in loss of unconsolidated entities, net
84 
219 
Deferred income taxes, net
16,342 
21,937 
Amortization of stock-based compensation
8,536 
7,518 
Charges for impairments and lot option abandonments
1,903 
1,124 
Bridge commitment fee
 
10,322 
Changes in assets and liabilities:
 
 
Real estate inventories
(305,889)
(249,890)
Receivables
(12,803)
34,107 
Other assets
25,490 
(6,484)
Accounts payable
(1,113)
(822)
Accrued expenses and other liabilities
195 
(11,874)
Other operating cash flows
 
65 
Net cash used in operating activities
(140,011)
(140,429)
Cash flows from investing activities:
 
 
Purchases of property and equipment
(1,059)
(6,068)
Cash acquired in the Merger
 
53,800 
Proceeds from sale of property and equipment
 
22 
Investments in unconsolidated entities
(1,458)
(573)
Distributions from unconsolidated entities
319 
 
Net cash (used in) provided by investing activities
(2,198)
47,181 
Cash flows from financing activities:
 
 
Borrowings from debt
140,000 
50,000 
Repayment of debt
(57,713)
 
Debt issuance costs
(2,688)
(23,003)
Proceeds from issuance of senior notes
 
886,698 
Bridge commitment fee
 
(10,322)
Repayment of debt payable to Weyerhaeuser
 
(623,589)
Decrease in book overdrafts
 
(22,492)
Distributions to Weyerhaeuser
 
(8,860)
Net (repayments) proceeds of debt held by variable interest entities
(5,927)
5,120 
Contributions from noncontrolling interests
4,281 
 
Distributions to noncontrolling interests
(9,198)
(18,703)
Proceeds from issuance of common stock under share-based awards
1,616 
 
Excess tax benefits of share-based awards
392 
1,572 
Minimum tax withholding paid on behalf of employees for share-based awards
(2,190)
 
Net cash provided by financing activities
68,573 
236,421 
Net (decrease) increase in cash and cash equivalents
(73,636)
143,173 
Cash and cash equivalents - beginning of period
170,629 
4,510 
Cash and cash equivalents - end of period
$ 96,993 
$ 147,683 
Organization, Basis of Presentation and Summary of Significant Accounting Policies
Organization, Basis of Presentation and Summary of Significant Accounting Policies

1.

Organization, Basis of Presentation and Summary of Significant Accounting Policies

Organization

The Company is engaged in the design, construction and sale of innovative single-family homes through its portfolio of six quality brands across eight states, including Maracay Homes in Arizona, Pardee Homes in California and Nevada, Quadrant Homes in Washington, Trendmaker Homes in Texas, TRI Pointe Homes in California and Colorado and Winchester Homes in Maryland and Virginia.  

Reorganization

On July 7, 2015, TRI Pointe Homes, Inc., a Delaware corporation, (“TRI Pointe Homes”) reorganized its corporate structure (the “Reorganization”) whereby TRI Pointe Homes became a direct, wholly owned subsidiary of TRI Pointe Group, Inc., a Delaware corporation (“TRI Pointe Group”).  See “Note Regarding This Quarterly Report” for information concerning the reorganization effected on July 7, 2015.

Basis of Presentation

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”).

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries as described in “Reverse Acquisition” below, as well as other entities in which the Company has a controlling interest and variable interest entities (“VIEs”) in which the Company is the primary beneficiary.  The noncontrolling interests as of September 30, 2015 and December 31, 2014 represent the outside owners’ interests in the Company’s consolidated entities and the net equity of the VIE owners.  All significant intercompany accounts have been eliminated upon consolidation.  Subsequent events have been evaluated through the date the financial statements were issued.  In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation with respect to interim financial statements, have been included.

The Company has historically experienced, and expects to continue to experience, variability in quarterly results. The results of operations for the three or nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the full year.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements should be read in conjunction with our consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Reverse Acquisition

On July 7, 2014 (the “Closing Date”), TRI Pointe consummated the previously announced merger (the “Merger”) of our wholly owned subsidiary, Topaz Acquisition, Inc. (“Merger Sub”), with and into Weyerhaeuser Real Estate Company (“WRECO”), with WRECO surviving the Merger and becoming our wholly owned subsidiary, as contemplated by the Transaction Agreement, dated as of November 3, 2013 (the “Transaction Agreement”), by and among us, Weyerhaeuser Company (“Weyerhaeuser”), WRECO and Merger Sub. The Merger is accounted for in accordance with ASC Topic 805, Business Combinations (“ASC 805”). For accounting purposes, the Merger is treated as a “reverse acquisition” and WRECO is considered the accounting acquirer. Accordingly, WRECO is reflected as the predecessor and acquirer and therefore the accompanying consolidated financial statements reflect the historical consolidated financial statements of WRECO for all periods presented and do not include the historical financial statements of TRI Pointe prior to the Closing Date. Subsequent to the Closing Date, the consolidated financial statements reflect the results of the combined company.

See Note 2, Merger with Weyerhaeuser Real Estate Company, for further information on the Merger. In the Merger, each issued and outstanding WRECO common share was converted into 1.297 shares of TRI Pointe common stock. The historical issued and outstanding WRECO common shares (100,000,000 common shares for all periods presented prior to the Merger) have been recast (as 129,700,000 common shares of the Company for all periods prior to the Merger) in all periods presented to reflect this conversion.

Use of Estimates

The preparation of these financial statements requires our management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from our estimates.

Recently Issued Accounting Standards

In April 2014, the FASB issued amendments to Accounting Standards Update 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. The update requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s financial results or a business activity classified as held for sale should be reported as discontinued operations. The amendments also expand the disclosure requirements for discontinued operations and add new disclosures for individually significant dispositions that do not qualify as discontinued operations. We adopted ASU 2014-08 on January 1, 2015 and the adoption had no impact on our current or prior year financial statements.

In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: identify the contract(s) with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 supersedes the revenue-recognition requirements in ASC Topic 605, Revenue Recognition, most industry-specific guidance throughout the industry topics of the accounting standards codification, and some cost guidance related to construction-type and production-type contracts. On July 9, 2015, the FASB voted to defer the effective date of ASU No. 2014-09 by one year and it is now effective for public entities for the annual periods ending after December 15, 2017, and for annual and interim periods thereafter.  Companies may use either a full retrospective or a modified retrospective approach to adopt ASU 2014-09.  Early adoption is permitted, but can be no earlier than the original public entity effective date of fiscal years, and the interim periods within those years, beginning after December 15, 2016.  We are currently evaluating the approach for implementation and the potential impact of adopting this guidance on our consolidated financial statements.

In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (“ASU 2014-15”), Presentation of Financial Statements — Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which requires management to evaluate, in connection with preparing financial statements for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable) and provide related disclosures. ASU 2014-15 is effective for the annual period ending after December 15, 2016, and for annual and interim periods thereafter. Early adoption is permitted. We believe the adoption of this guidance will not have a material effect on our consolidated financial statements.

In February 2015, the FASB issued Accounting Standards Update No. 2015-02, (“ASU 2015-02”), Consolidation (Topic 810): Amendments to the Consolidation Analysis.   ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. ASU 2015-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. We believe the adoption of ASU 2015-02 will not have a material effect on our consolidated financial statements.

In April 2015, the FASB issued Accounting Standards Update No. 2015-03, (“ASU 2015-03”), Interest - Imputation of Interest (Subtopic 835-30), and as amended in August 2015 by Accounting Standards Update No. 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, which changes the presentation of debt issuance costs related to a recognized debt liability in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The FASB will permit debt issuance costs related to line-of-credit agreements to be deferred and presented as an asset, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement.  Amortization of the costs is reported as interest expense.  ASU 2015-03 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. The Company plans to early adopt this guidance at the beginning of the fourth quarter of 2015.  Had the Company early adopted ASU 2015-03, the impact for the period ended September 30, 2015 on our consolidated balance sheet would have been a balance sheet reclassification of deferred loan costs currently included in Other Assets resulting in a decrease to Other Assets of $23.6 million, a decrease to Senior Notes of $21.2 million and a decrease to unsecured revolving credit facility of $2.4 million. The impact for the period ended December 31, 2014, would have been a decrease to Other Assets of $23.7 million and a decrease to Senior Notes of $23.7 million.

Reclassifications

Certain amounts in our consolidated financial statements for prior years have been reclassified to conform to the current period presentation.

Merger with Weyerhaeuser Real Estate Company
Merger with Weyerhaeuser Real Estate Company

2.

Merger with Weyerhaeuser Real Estate Company

In the Merger, TRI Pointe issued 129,700,000 shares of TRI Pointe common stock to the former holders of WRECO common shares, together with cash in lieu of any fractional shares. On the Closing Date, WRECO became a wholly owned subsidiary of TRI Pointe. Immediately following the consummation of the Merger, the ownership of TRI Pointe common stock on a fully diluted basis was as follows: (i) the WRECO common shares held by former Weyerhaeuser shareholders were converted into the right to receive, in the aggregate, 79.6% of the then outstanding TRI Pointe common stock, (ii) the TRI Pointe common stock outstanding immediately prior to the consummation of the Merger represented 19.4% of the then outstanding TRI Pointe common stock, and (iii) the outstanding equity awards of WRECO and TRI Pointe employees represented the remaining 1.0% of the then outstanding TRI Pointe common stock. On the Closing Date, the former direct parent entity of WRECO paid TRI Pointe $31.5 million in cash in accordance with the Transaction Agreement.  Following the Merger, WRECO changed its name to TRI Pointe Holdings, Inc.

Assumption of Senior Notes

On the Closing Date, TRI Pointe Homes assumed WRECO’s obligations as issuer of $450 million aggregate principal amount of its 4.375% Senior Notes due 2019 (the “2019 Notes”) and $450 million aggregate principal amount of its 5.875% Senior Notes due 2024 (the “2024 Notes” and together with the 2019 Notes, the “Senior Notes”). Additionally, WRECO and certain of its subsidiaries (collectively, the “Guarantors”) entered into supplemental indentures pursuant to which they guaranteed TRI Pointe’s obligations with respect to the Senior Notes. The Guarantors also entered into a joinder agreement to the Purchase Agreement, dated as of June 4, 2014, among WRECO, TRI Pointe, and the initial purchasers of the Senior Notes (collectively, the “Initial Purchasers”), pursuant to which the Guarantors became parties to the Purchase Agreement. Additionally, TRI Pointe and the Guarantors entered into joinder agreements to the Registration Rights Agreements, dated as of June 13, 2014, among WRECO and the Initial Purchasers with respect to the Senior Notes, pursuant to which TRI Pointe and the Guarantors were joined as parties to the Registration Rights Agreements. In connection with the Reorganization, TRI Pointe Group became a co-issuer with TRI Pointe Homes of the Senior Notes.

The net proceeds of $861.3 million from the offering of the Senior Notes were deposited into two separate escrow accounts following the closing of the offering on June 13, 2014. Upon release of the escrowed funds on the Closing Date and prior to the consummation of the Merger, WRECO paid $743.7 million in cash to its former direct parent, which cash was retained by Weyerhaeuser and its subsidiaries (other than WRECO and its subsidiaries). The payment consisted of the $739.0 million Payment Amount (as defined in the Transaction Agreement) as well as $4.7 million in payment of all unpaid interest on the debt payable to Weyerhaeuser that accrued from November 3, 2013 to the Closing Date. The remaining $117.6 million of proceeds was retained by TRI Pointe.

Fair Value of Assets Acquired and Liabilities Assumed

The following table summarizes the calculation of the fair value of the total consideration transferred and the provisional amounts recognized as of the Closing Date (in thousands, except shares and closing stock price):

 

Calculation of consideration transferred

 

 

 

 

TRI Pointe shares outstanding

 

 

31,632,533

 

TRI Pointe closing stock price on July 7, 2014

 

$

15.85

 

Consideration attributable to common stock

 

$

501,376

 

Consideration attributable to TRI Pointe share-based

   equity awards

 

 

1,072

 

Total consideration transferred

 

$

502,448

 

Assets acquired and liabilities assumed

 

 

 

 

Cash and cash equivalents

 

$

53,800

 

Accounts receivable

 

 

654

 

Real estate inventories

 

 

539,677

 

Intangible asset

 

 

17,300

 

Goodwill

 

 

139,304

 

Other assets

 

 

28,060

 

Total assets acquired

 

 

778,795

 

Accounts payable

 

 

26,105

 

Accrued expenses and other liabilities

 

 

23,114

 

Notes payable and other borrowings

 

 

227,128

 

Total liabilities assumed

 

 

276,347

 

Total net assets acquired

 

$

502,448

 

 

Cash and cash equivalents, accounts receivable, other assets, accounts payable, accrued payroll liabilities, and accrued expenses and other liabilities were generally stated at historical carrying values given the short-term nature of these assets and liabilities. Notes payable and other borrowings are stated at carrying value due to the limited amount of time since the notes payable and other borrowings were entered into prior to the Closing Date.

The Company determined the fair value of real estate inventories on a community-by-community basis primarily using a combination of market-comparable land transactions, land residual analysis and discounted cash flow models. The estimated fair value is significantly impacted by estimates related to expected average selling prices, sales pace, cancellation rates and construction and overhead costs. Such estimates must be made for each individual community and may vary significantly between communities.

The fair value of the acquired intangible asset was determined based on a valuation performed by an independent valuation specialist. The $17.3 million intangible asset is related to the TRI Pointe Homes trade name which is deemed to have an indefinite useful life.

Goodwill is primarily attributed to expected synergies from combining WRECO’s and TRI Pointe’s existing businesses, including, but not limited to, expected cost synergies from overhead savings resulting from streamlining certain redundant corporate functions, improved operating efficiencies, including provision of certain corporate level administrative and support functions at a lower cost than was historically allocated to WRECO for such services by its former direct parent, and growth of ancillary operations in various markets as permitted under applicable law, including a mortgage business, a title company and other ancillary operations. The Company also anticipates opportunities for growth through expanded geographic and customer segment diversity and the ability to leverage additional brands.  The acquired goodwill is not deductible for income tax purposes.

The Company completed its business combination accounting during the first quarter of 2015.

Supplemental Pro Forma Information (Unaudited)

The following represents unaudited pro forma operating results as if the acquisition had been completed as of January 1, 2014 (in thousands, except per share amounts):

 

 

 

Three Months Ended

September 30, 2014

 

 

Nine Months Ended

September 30, 2014

 

Total revenues

 

$

479,879

 

 

$

1,230,722

 

Net income

 

$

21,934

 

 

$

66,902

 

Earnings per share – basic

 

$

0.14

 

 

$

0.41

 

Earnings per share – diluted

 

$

0.14

 

 

$

0.41

 

 

The unaudited pro forma operating results have been determined after adjusting the operating results of TRI Pointe to reflect the purchase accounting and other acquisition adjustments including interest expense associated with the debt used to fund a portion of the Merger. The unaudited pro forma results do not reflect any cost savings, operating synergies or other enhancements that we may achieve as a result of the Merger or the costs necessary to integrate the operations to achieve these cost savings and synergies. Accordingly, the unaudited pro forma amounts are for comparative purposes only and may not necessarily reflect the results of operations had the Merger been completed at the beginning of the period or be indicative of the results we will achieve in the future.

 

Restructuring
Restructuring

3.

Restructuring

In connection with the Merger, the Company initiated a restructuring plan to reduce duplicate corporate and divisional overhead costs and expenses. In addition, WRECO previously recognized restructuring expenses related to general cost reduction initiatives. Restructuring costs were comprised of the following (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Employee-related costs

 

$

1,433

 

 

$

6,817

 

 

$

1,568

 

 

$

8,124

 

Lease termination costs

 

 

577

 

 

 

207

 

 

 

1,162

 

 

 

1,078

 

Total

 

$

2,010

 

 

$

7,024

 

 

$

2,730

 

 

$

9,202

 

 

Employee-related costs incurred during the three months ended September 30, 2014 included employee retention and severance-related expenses of $5.5 million and stock-based compensation expense of $1.3 million for employees terminated during the period.  Employee-related costs incurred during the nine months ended September 30, 2014 included employee retention and severance-related expenses of $6.8 million and stock-based compensation expense of $1.3 million for employees terminated during the period.  Lease termination costs for the three and nine months ended September 30, 2015, and 2014, respectively, relate to contract terminations as a result of general cost reduction initiatives.

Changes in employee-related restructuring reserves were as follows (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Accrued employee-related costs, beginning of

   period

 

$

109

 

 

$

 

 

$

3,844

 

 

$

4,336

 

Current year charges

 

 

1,433

 

 

 

5,550

 

 

 

1,568

 

 

 

6,857

 

Adjustments to pre-existing reserves

 

 

(83

)

 

 

 

 

 

(83

)

 

 

 

Payments

 

 

(1,004

)

 

 

(1,576

)

 

 

(4,874

)

 

 

(7,219

)

Accrued employee-related costs, end of period

 

$

455

 

 

$

3,974

 

 

$

455

 

 

$

3,974

 

 

Changes in lease termination related restructuring reserves were as follows (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Accrued lease termination costs, beginning of

   period

 

$

644

 

 

$

2,454

 

 

$

1,394

 

 

$

3,506

 

Current year charges

 

 

577

 

 

 

207

 

 

 

1,162

 

 

 

1,078

 

Payments

 

 

(705

)

 

 

(902

)

 

 

(2,040

)

 

 

(2,825

)

Accrued lease termination costs, end of period

 

$

516

 

 

$

1,759

 

 

$

516

 

 

$

1,759

 

 

Employee and lease termination restructuring reserves are included in accrued expenses and other liabilities on our consolidated balance sheets.

 

Segment Information
Segment Information

4.

Segment Information

Our operations consist of six homebuilding companies that acquire and develop land and construct and sell single-family homes.  In accordance with ASC Topic 280, Segment Reporting, in determining the most appropriate reportable segments, we considered similar economic and other characteristics, including product types, average selling prices, gross profits, production processes, suppliers, subcontractors, regulatory environments, land acquisition results, and underlying demand and supply.  Based on our aggregation analysis, we have not exercised any aggregation of our operating segments, which are represented by the following six reportable segments: Maracay Homes, consisting of operations in Arizona; Pardee Homes, consisting of operations in California and Nevada; Quadrant Homes, consisting of operations in Washington; Trendmaker Homes, consisting of operations in Texas; TRI Pointe Homes, consisting of operations in California and Colorado; and Winchester Homes, consisting of operations in Maryland and Virginia.

Corporate is a non-operating segment that develops and implements company-wide strategic initiatives and provides support to our homebuilding reporting segments by centralizing certain administrative functions, such as marketing, legal, accounting, treasury, insurance and risk management, information technology and human resources, to benefit from economies of scale. Our Corporate non-operating segment also includes general and administrative expenses related to operating our corporate headquarters. A portion of the expenses incurred by Corporate is allocated to the homebuilding reporting segments.

The reportable segments follow the same accounting policies as our consolidated financial statements described in Note 1. Operational results of each reportable segment are not necessarily indicative of the results that would have been achieved had the reportable segment been an independent, stand-alone entity during the periods presented.

Total revenues and income before taxes for each of our reportable segments were as follows (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Total revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maracay Homes

 

$

50,505

 

 

$

37,301

 

 

$

116,556

 

 

$

107,576

 

Pardee Homes

 

 

172,957

 

 

 

134,409

 

 

 

424,680

 

 

 

352,118

 

Quadrant Homes

 

 

48,173

 

 

 

32,919

 

 

 

132,698

 

 

 

96,958

 

Trendmaker Homes

 

 

81,044

 

 

 

69,711

 

 

 

203,235

 

 

 

198,867

 

TRI Pointe Homes

 

 

224,544

 

 

 

123,445

 

 

 

462,136

 

 

 

123,445

 

Winchester Homes

 

 

70,918

 

 

 

80,135

 

 

 

181,611

 

 

 

189,651

 

Total

 

$

648,141

 

 

$

477,920

 

 

$

1,520,916

 

 

$

1,068,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maracay Homes

 

$

3,750

 

 

$

2,212

 

 

$

5,858

 

 

$

8,222

 

Pardee Homes

 

 

39,749

 

 

 

21,787

 

 

 

121,041

 

 

 

47,580

 

Quadrant Homes

 

 

3,982

 

 

 

649

 

 

 

6,329

 

 

 

6,889

 

Trendmaker Homes

 

 

7,496

 

 

 

7,327

 

 

 

17,896

 

 

 

21,529

 

TRI Pointe Homes

 

 

29,556

 

 

 

8,685

 

 

 

55,251

 

 

 

8,685

 

Winchester Homes

 

 

1,726

 

 

 

6,941

 

 

 

8,064

 

 

 

17,978

 

Corporate

 

 

(8,469

)

 

 

(30,615

)

 

 

(26,523

)

 

 

(51,760

)

Total

 

$

77,790

 

 

$

16,986

 

 

$

187,916

 

 

$

59,123

 

 

Total real estate inventories and total assets for each of our reportable segments, as of the date indicated, were as follows (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Real estate inventories

 

 

 

 

 

 

 

 

Maracay Homes

 

$

205,432

 

 

$

153,577

 

Pardee Homes

 

 

1,013,792

 

 

 

924,362

 

Quadrant Homes

 

 

193,374

 

 

 

153,493

 

Trendmaker Homes

 

 

191,803

 

 

 

176,696

 

TRI Pointe Homes

 

 

678,564

 

 

 

613,666

 

Winchester Homes

 

 

293,437

 

 

 

258,389

 

Total

 

$

2,576,402

 

 

$

2,280,183

 

 

 

 

 

 

 

 

 

 

Total assets

 

 

 

 

 

 

 

 

Maracay Homes

 

$

221,190

 

 

$

170,932

 

Pardee Homes

 

 

1,080,599

 

 

 

1,000,489

 

Quadrant Homes

 

 

206,986

 

 

 

167,796

 

Trendmaker Homes

 

 

219,869

 

 

 

195,829

 

TRI Pointe Homes

 

 

847,013

 

 

 

781,301

 

Winchester Homes

 

 

312,932

 

 

 

281,547

 

Corporate

 

 

223,224

 

 

 

315,630

 

Total

 

$

3,111,813

 

 

$

2,913,524

 

 

Earnings Per Share
Earnings Per Share

5.

Earnings Per Share

The following table sets forth the components used in the computation of basic and diluted earnings per share (in thousands, except share and per share amounts):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common stockholders

 

$

50,162

 

 

$

10,965

 

 

$

120,389

 

 

$

42,771

 

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic weighted-average shares outstanding

 

 

161,772,893

 

 

 

158,931,450

 

 

 

161,651,177

 

 

 

139,550,891

 

Effect of dilutive shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options and unvested restricted

   stock units

 

 

593,851

 

 

 

227,256

 

 

 

648,105

 

 

 

662,764

 

Diluted weighted-average shares

   outstanding

 

 

162,366,744

 

 

 

159,158,706

 

 

 

162,299,282

 

 

 

140,213,655

 

Earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.31

 

 

$

0.07

 

 

$

0.74

 

 

$

0.31

 

Diluted

 

$

0.31

 

 

$

0.07

 

 

$

0.74

 

 

$

0.31

 

Antidilutive unvested restricted stock units and

   stock options not included in diluted earnings

   per share

 

 

2,260,532

 

 

 

3,634,614

 

 

 

2,462,268

 

 

 

 

 

Receivables
Receivables

6.

Receivables

Receivables consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Escrow proceeds and other accounts receivable, net

 

$

22,128

 

 

$

9,771

 

Warranty insurance receivable (Note 15)

 

 

10,493

 

 

 

10,047

 

Notes and contracts receivable

 

 

300

 

 

 

300

 

Total receivables

 

$

32,921

 

 

$

20,118

 

 

Real Estate Inventories
Real Estate Inventories

7.

Real Estate Inventories

Real estate inventories consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Real estate inventories owned:

 

 

 

 

 

 

 

 

Homes completed or under construction

 

$

749,852

 

 

$

461,712

 

Land under development

 

 

1,380,298

 

 

 

1,391,303

 

Land held for future development

 

 

257,610

 

 

 

245,673

 

Model homes

 

 

127,815

 

 

 

103,270

 

Total real estate inventories owned

 

 

2,515,575

 

 

 

2,201,958

 

Real estate inventories not owned:

 

 

 

 

 

 

 

 

Land purchase and land option deposits

 

 

42,329

 

 

 

44,155

 

Consolidated inventory held by VIEs

 

 

18,498

 

 

 

34,070

 

Total real estate inventories not owned

 

 

60,827

 

 

 

78,225

 

Total real estate inventories

 

$

2,576,402

 

 

$

2,280,183

 

 

Homes completed or under construction is comprised of costs associated with homes in various stages of construction and includes direct construction and related land acquisition and land development costs. Land under development primarily consists of land acquisition and land development costs, which include capitalized interest and real estate taxes, associated with land undergoing improvement activity. Land held for future development principally reflects land acquisition and land development costs related to land where development activity has not yet begun or has been suspended, but is expected to occur in the future.

Real estate inventories not owned represents deposits related to land purchase and land option agreements as well as consolidated inventory held by variable interest entities. For further details, see Note 9, Variable Interest Entities.

During the second quarter ended June 30, 2015 the Company sold a 15.72 acre employment center located in the Pacific Highlands Ranch community in the San Diego, California division of our Pardee Homes reporting segment.  The land sold under this sale was classified as land under development and represented $53.0 million of land and lot sales revenue in the consolidated statement of operations for the nine months ended September 30, 2015. 

Interest incurred, capitalized and expensed were as follows (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Interest incurred

 

$

15,454

 

 

$

15,129

 

 

$

45,779

 

 

$

25,718

 

Interest capitalized

 

 

(15,454

)

 

 

(14,839

)

 

 

(45,779

)

 

 

(22,987

)

Interest expensed

 

$

 

 

$

290

 

 

$

 

 

$

2,731

 

Capitalized interest in beginning inventory

 

$

140,106

 

 

$

113,765

 

 

$

124,461

 

 

$

138,233

 

Interest capitalized as a cost of inventory

 

 

15,454

 

 

 

14,839

 

 

 

45,779

 

 

 

22,987

 

Interest previously capitalized as a cost of

   inventory, included in cost of sales

 

 

(13,339

)

 

 

(7,835

)

 

 

(28,019

)

 

 

(40,451

)

Capitalized interest in ending inventory

 

$

142,221

 

 

$

120,769

 

 

$

142,221

 

 

$

120,769

 

 

Interest is capitalized to real estate inventory during development and other qualifying activities. Interest that is capitalized to real estate inventory is included in cost of home sales as related units are delivered.  Interest that is expensed as incurred is included in other income (expense).

Real estate inventory impairments and land and lot option abandonments

Real estate inventory impairments and land option abandonments consisted of the following (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Real estate inventory impairments

 

$

29

 

 

$

248

 

 

$

1,073

 

 

$

300

 

Land and lot option abandonments and

   pre-acquisition costs

 

 

336

 

 

 

304

 

 

 

830

 

 

 

824

 

Total

 

$

365

 

 

$

552

 

 

$

1,903

 

 

$

1,124

 

 

Impairments of real estate inventory relate primarily to projects or communities that include homes completed or under construction. Within a project or community, there may be individual homes or parcels of land that are currently held for sale. Impairment charges recognized as a result of adjusting individual held-for-sale assets within a community to estimated fair value less cost to sell are also included in the total impairment charges above.  Charges for inventory impairments are expensed to cost of sales.

In addition to owning land and residential lots, we also have option agreements to purchase land and lots at a future date. We have option deposits and capitalized pre-acquisition costs associated with the optioned land and lots. When the economics of a project no longer support acquisition of the land or lots under option, we may elect not to move forward with the acquisition. Option deposits and capitalized pre-acquisition costs associated with the assets under option may be forfeited at that time. Charges for such forfeitures are expensed to cost of sales.

 

Investments in Unconsolidated Entities
Investments in Unconsolidated Entities

8.

Investments in Unconsolidated Entities

As of September 30, 2015, we held equity investments in six active real estate partnerships or limited liability companies. Our participation in these entities may be as a developer, a builder, or an investment partner. Our ownership percentage varies from 7% to 55%, depending on the investment, with no controlling interest held in any of these investments.

Investments Held

Our cumulative investment in entities accounted for on the equity method, including our share of earnings and losses, consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Limited liability company interests

 

$

14,079

 

 

$

13,710

 

General partnership interests

 

 

3,261

 

 

 

3,095

 

Total

 

$

17,340

 

 

$

16,805

 

 

Unconsolidated Financial Information

Aggregated assets, liabilities and operating results of the entities we account for as equity-method investments are provided below. Because our ownership interest in these entities varies, a direct relationship does not exist between the information presented below and the amounts that are reflected on our consolidated balance sheets as our investment in unconsolidated entities or on our consolidated statement of operations as equity in loss of unconsolidated entities.

Assets and liabilities of unconsolidated entities (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Assets

 

 

 

 

 

 

 

 

Cash

 

$

19,282

 

 

$

17,154

 

Receivables

 

 

12,916

 

 

 

9,550

 

Real estate inventories

 

 

91,712

 

 

 

95,500

 

Other assets

 

 

882

 

 

 

620

 

Total assets

 

$

124,792

 

 

$

122,824

 

Liabilities and equity

 

 

 

 

 

 

 

 

Accounts payable and other liabilities

 

$

14,293

 

 

$

10,914

 

Company’s equity

 

 

17,340

 

 

 

16,805

 

Outside interests’ equity

 

 

93,159

 

 

 

95,105

 

Total liabilities and equity

 

$

124,792

 

 

$

122,824

 

 

Results of operations from unconsolidated entities (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Net sales

 

$

1,217

 

 

$

184

 

 

$

2,670

 

 

$

591

 

Other operating expense

 

 

(1,479

)

 

 

(1,215

)

 

 

(4,020

)

 

 

(3,372

)

Other income

 

 

(263

)

 

 

2

 

 

 

(256

)

 

 

16

 

Net loss

 

$

(525

)

 

$

(1,029

)

 

$

(1,606

)

 

$

(2,765

)

Company’s equity in loss of unconsolidated entities

 

$

(3

)

 

$

(82

)

 

$

(84

)

 

$

(219

)

 

Variable Interest Entities
Variable Interest Entities

9.

Variable Interest Entities

In the ordinary course of business, we enter into land option agreements in order to procure land and residential lots for future development and the construction of homes. The use of such land option agreements generally allows us to reduce the risks associated with direct land ownership and development, and reduces our capital and financial commitments. Pursuant to these land option agreements, we generally provide a deposit to the seller as consideration for the right to purchase land at different times in the future, usually at predetermined prices. Such deposits are recorded as land purchase and land option deposits under real estate inventories not owned in the accompanying consolidated balance sheets.

We analyze each of our land option agreements and other similar contracts under the provisions of ASC 810 Consolidation to determine whether the land seller is a VIE and, if so, whether we are the primary beneficiary. Although we do not have legal title to the underlying land, if we are determined to be the primary beneficiary of the VIE, we will consolidate the VIE in our financial statements and reflect its assets as real estate inventory not owned included in our real estate inventories, its liabilities as debt (nonrecourse) held by VIEs in accrued expenses and other liabilities and the net equity of the VIE owners as noncontrolling interests on our consolidated balance sheets. In determining whether we are the primary beneficiary, we consider, among other things, whether we have the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance. Such activities would include, among other things, determining or limiting the scope or purpose of the VIE, selling or transferring property owned or controlled by the VIE, or arranging financing for the VIE.

Creditors of the entities with which we have land option agreements have no recourse against us. The maximum exposure to loss under our land option agreements is limited to non-refundable option deposits and any capitalized pre-acquisition costs. In some cases, we have also contracted to complete development work at a fixed cost on behalf of the land owner and budget shortfalls and savings will be borne by us.

The following provides a summary of our interests in land option agreements (in thousands):

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

 

 

 

 

Remaining

 

 

Consolidated

 

 

 

 

 

 

Remaining

 

 

Consolidated

 

 

 

 

 

 

 

Purchase

 

 

Inventory

 

 

 

 

 

 

Purchase

 

 

Inventory

 

 

 

Deposits

 

 

Price

 

 

Held by VIEs

 

 

Deposits

 

 

Price

 

 

Held by VIEs

 

Consolidated VIEs

 

$

4,696

 

 

$

14,140

 

 

$

18,498

 

 

$

8,071

 

 

$

43,432

 

 

$

34,070

 

Unconsolidated VIEs

 

 

8,150

 

 

 

22,781

 

 

N/A

 

 

 

13,309

 

 

 

129,637

 

 

N/A

 

Other land option agreements

 

 

34,179

 

 

 

308,438

 

 

N/A

 

 

 

30,846

 

 

 

284,819

 

 

N/A

 

Total

 

$

47,025

 

 

$

345,359

 

 

$

18,498

 

 

$

52,226

 

 

$

457,888

 

 

$

34,070

 

 

Unconsolidated VIEs represent land option agreements that were not consolidated because we were not the primary beneficiary. Other land option agreements were not considered VIEs.

In addition to the deposits presented in the table above, our exposure to loss related to our land option contracts consisted of capitalized pre-acquisition costs of $4.6 million and $5.3 million as of September 30, 2015 and December 31, 2014, respectively. These pre-acquisition costs were included in real estate inventories as land under development on our consolidated balance sheets.  

Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets

10.

Goodwill and Other Intangible Assets

In connection with the Merger, $139.3 million of goodwill has been recorded as of September 30, 2015.  For further details on the goodwill, see Note 2, Merger with Weyerhaeuser Real Estate Company.

We have two intangible assets recorded as of September 30, 2015, including an existing trade name from the acquisition of Maracay Homes in 2006 which has a 20 year useful life, and TRI Pointe Homes, resulting from the Merger in 2014 which has an indefinite useful life. For further details on the TRI Pointe Homes trade name see Note 2, Merger with Weyerhaeuser Real Estate Company.

Goodwill and other intangible assets consisted of the following (in thousands):

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

Gross

 

 

 

 

 

 

Net

 

 

Gross

 

 

 

 

 

 

Net

 

 

 

Carrying

 

 

Accumulated

 

 

Carrying

 

 

Carrying

 

 

Accumulated

 

 

Carrying

 

 

 

Amount

 

 

Amortization

 

 

Amount

 

 

Amount

 

 

Amortization

 

 

Amount

 

Goodwill

 

$

139,303

 

 

$

 

 

$

139,303

 

 

$

139,304

 

 

$

 

 

$

139,304

 

Trade names

 

 

27,979

 

 

 

(5,120

)

 

 

22,859

 

 

 

27,979

 

 

 

(4,720

)

 

 

23,259

 

Total

 

$

167,282

 

 

$

(5,120

)

 

$

162,162

 

 

$

167,283

 

 

$

(4,720

)

 

$

162,563

 

 

The remaining useful life of our amortizing intangible asset related to the Maracay Homes trade name was 10.4 and 11.2 years as of September 30, 2015 and December 31, 2014, respectively. Amortization expense related to this intangible asset was $134,000 for each of the three month periods ended September 30, 2015 and 2014, respectively and was $400,000 for each of the nine month periods ended September 30, 2015 and 2014, respectively.  Amortization of this intangible asset was charged to sales and marketing expense.  Our $17.3 million indefinite life intangible asset related to the TRI Pointe Homes trade name is not amortizing. All trade names are evaluated for impairment on an annual basis or more frequently if indicators of impairment exist.

Expected amortization of our intangible asset related to Maracay Homes for the remainder of 2015, the next four years and thereafter is (in thousands):

 

Remainder of 2015

 

$

134

 

2016

 

 

534

 

2017

 

 

534

 

2018

 

 

534

 

2019

 

 

534

 

Thereafter

 

 

3,289

 

Total

 

$

5,559

 

 

Other Assets
Other Assets

11.

Other Assets

Other assets consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Prepaid expenses

 

$

20,989

 

 

$

29,111

 

Refundable fees and other deposits

 

 

16,576

 

 

 

15,581

 

Development rights, held for future use or sale

 

 

6,447

 

 

 

7,409

 

Deferred loan costs

 

 

23,617

 

 

 

23,686

 

Operating properties and equipment, net

 

 

8,869

 

 

 

11,719

 

Income tax receivable

 

 

1,808

 

 

 

10,713

 

Other

 

 

6,210

 

 

 

7,186

 

Total

 

$

84,516

 

 

$

105,405

 

 

Accrued Expenses and Other Liabilities
Accrued Expenses and Other Liabilities

12.

Accrued Expenses and Other Liabilities

Accrued expenses and other liabilities consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Accrued payroll and related costs

 

$

21,544

 

 

$

24,717

 

Warranty reserves (Note 15)

 

 

36,743

 

 

 

33,270

 

Estimated cost for completion of real estate inventories

 

 

62,047

 

 

 

54,437

 

Customer deposits

 

 

19,734

 

 

 

14,229

 

Debt (nonrecourse) held by VIEs

 

 

3,286

 

 

 

9,512

 

Income tax liability to Weyerhaeuser (Note 18)

 

 

8,600

 

 

 

15,659

 

Liability for uncertain tax positions (Note 17)

 

 

16,563

 

 

 

13,797

 

Accrued interest

 

 

13,976

 

 

 

3,059

 

Accrued insurance expense

 

 

1,975

 

 

 

9,180

 

Other

 

 

26,239

 

 

 

32,149

 

Total

 

$

210,707

 

 

$

210,009

 

 

Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans
Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans

13.

Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans

Senior Notes

Senior Notes consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

4.375% Senior Notes due June 15, 2019, net of discount

 

$

446,186

 

 

$

445,501

 

5.875% Senior Notes due June 15, 2024, net of discount

 

 

442,471

 

 

 

442,001

 

Total

 

$

888,657

 

 

$

887,502

 

 

As discussed in Note 2, Merger with Weyerhaeuser Real Estate Company, on the Closing Date, TRI Pointe assumed WRECO’s obligations as issuer of the Senior Notes. The 2019 Notes were issued at 98.89% of their aggregate principal amount and the 2024 Notes were issued at 98.15% of their aggregate principal amount. The net proceeds of $861.3 million, after debt issuance costs and discounts, from the offering were deposited into two separate escrow accounts following the closing of the offering on June 13, 2014.

The 2019 Notes and the 2024 Notes mature on June 15, 2019 and June 15, 2024, respectively. Interest is payable semiannually in arrears on June 15 and December 15. As of September 30, 2015, no principal has been paid on the Senior Notes, and there was $21.2 million of capitalized debt financing costs, included in other assets on our consolidated balance sheet, related to the Senior Notes that will amortize over the lives of the Senior Notes. Accrued interest related to the Senior Notes was $13.5 million and $1.9 million as of September 30, 2015 and December 31, 2014, respectively.

Unsecured Revolving Credit Facility

Unsecured revolving credit facility consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Unsecured revolving credit facility

 

$

349,392

 

 

$

260,000

 

 

In May 2015, the Company amended its unsecured revolving credit facility (the “Credit Facility”) from $425 million to $550 million.  The Credit Facility matures on May 18, 2019, and contains a sublimit of $75 million for letters of credit. The Company may borrow under the Credit Facility in the ordinary course of business to fund its operations, including its land development and homebuilding activities. Borrowings under the Credit Facility will be governed by, among other things, a borrowing base. Interest rates on borrowings under the Credit Facility will be based on either a daily Eurocurrency base rate or a Eurocurrency rate, in either case, plus a spread ranging from 1.45% to 2.20%, depending on the Company’s leverage ratio. As of September 30, 2015, the outstanding balance under the Credit Facility was $349.4 million with an interest rate of 2.16% per annum and $192.4 million of availability after considering the borrowing base provisions and outstanding letters of credit.  As of September 30, 2015 there was $2.4 million of capitalized debt financing costs, included in Other Assets on our consolidated balance sheet, related to the Credit Facility that will amortize over the life of the Credit Facility, maturing on May 18, 2019.  Accrued interest related to the Credit Facility was $376,000 and $620,000 as of September 30, 2015 and December 31, 2014, respectively.

At September 30, 2015 we had outstanding letters of credit of $8.2 million.  These letters of credit were issued to secure various financial obligations.  We believe it is not probable that any outstanding letters of credit will be drawn upon.

Seller Financed Loans

Seller financed loans consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Seller financed loans

 

$

7,572

 

 

$

14,677

 

 

As of September 30, 2015, the Company had $7.6 million outstanding related to seller financed loans to acquire lots for the construction of homes.  Principal and interest payments on these loans are due at various maturity dates, including at the time individual homes associated with the acquired land are delivered.  As of September 30, 2015, the seller financed loans accrue interest at a weighted average rate of 6.95% per annum, with interest calculated on a daily basis. Any remaining unpaid balance on these loans is due in May 2016. Accrued interest on these loans was $122,000 and $517,000 as of September 30, 2015 and December 31, 2014, respectively.

Interest Incurred

During the three month periods ended September 30, 2015 and 2014, the Company incurred interest of $15.5 million and $15.1 million, respectively, related to all notes payable and Senior Notes outstanding during the period. Of the interest incurred, $15.5 million and $14.8 million was capitalized to inventory for the three month period ended September 30, 2015 and 2014, respectively. Included in interest incurred was amortization of deferred financing and Senior Note discount costs of $1.5 million and $1.0 million for the three months ended September 30, 2015 and 2014, respectively.  During the nine month periods ended September 30, 2015 and 2014, the Company incurred interest of $45.8 million and $25.7 million, respectively, related to all notes payable, Senior Notes and debt payable to Weyerhaeuser outstanding during the period.   Of the interest incurred, $45.8 million and $23.0 million was capitalized to inventory for the nine months ended September 30, 2015 and 2014, respectively.  Included in interest incurred was amortization of deferred financing and Senior Note discount costs of $3.9 million and $ 1.1 million for the nine months ended September 30, 2015 and 2014, respectively.  Accrued interest related to all outstanding debt at September 30, 2015 and December 31, 2014 was $14.0 million and $3.1 million, respectively.  

Covenant Requirements

The Senior Notes contain covenants that restrict our ability to, among other things, create liens or other encumbrances, enter into sale and leaseback transactions, or merge or sell all or substantially all of our assets. These limitations are subject to a number of qualifications and exceptions.

Under the Credit Facility, the Company is required to comply with certain financial covenants, including but not limited to (i) a minimum consolidated tangible net worth; (ii) a maximum total leverage ratio; and (iii) a minimum interest coverage ratio.

The Company was in compliance with all applicable financial covenants as of September 30, 2015 and December 31, 2014.

Fair Value Disclosures
Fair Value Disclosures

14.

Fair Value Disclosures

Fair Value Measurements

ASC Topic 820, Fair Value Measurements and Disclosures, defines “fair value” as the price that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at measurement date and requires assets and liabilities carried at fair value to be classified and disclosed in the following three categories:

 

·

Level 1—Quoted prices for identical instruments in active markets

 

·

Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are inactive; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets at measurement date

 

·

Level 3—Valuations derived from techniques where one or more significant inputs or significant value drivers are unobservable in active markets at measurement date

Fair Value of Financial Instruments

A summary of assets and liabilities at September 30, 2015 and December 31, 2014, related to our financial instruments, measured at fair value on a recurring basis, is set forth below (in thousands):

 

 

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

Hierarchy

 

Book Value

 

 

Fair Value

 

 

Book Value

 

 

Fair Value

 

Receivables (1)

 

Level 3

 

$

32,921

 

 

$

32,921

 

 

$

20,118

 

 

$

20,118

 

Senior Notes (2)

 

Level 2

 

 

888,657

 

 

 

878,625

 

 

 

887,502

 

 

 

896,625

 

Unsecured revolving credit facility (3)

 

Level 3

 

 

349,392

 

 

 

349,392

 

 

 

260,000

 

 

 

260,000

 

Seller financed loans (4)

 

Level 3

 

 

7,572

 

 

 

7,572

 

 

 

14,677

 

 

 

14,677

 

 

At September 30, 2015 and December 31, 2014, the carrying value of cash and cash equivalents approximated fair value.

(1)

The book value of our receivables equaled the fair value as of September 30, 2015 and December 31, 2014 due to the short-term nature of the remaining receivables.

(2)

The estimated fair value of our Senior Notes at September 30, 2015 and December 31, 2014 is based on quoted market prices.

(3)

We believe that the carrying value of our Credit Facility approximates fair value based on the short term nature of the current market rate amended on May 18, 2015.

(4)

We believe that the carrying value of our Seller financed loans approximates fair value based on a two year treasury curve analysis.

Fair Value of Nonfinancial Assets

Nonfinancial assets include items such as real estate inventories and long-lived assets that are measured at fair value on a nonrecurring basis when events and circumstances indicate the carrying value is not recoverable. The following table presents impairment charges and the remaining net fair value for nonfinancial assets that were measured during the periods presented (in thousands):

 

 

 

 

 

Nine Months Ended

 

 

Year Ended

 

 

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

 

 

 

 

 

 

Fair Value

 

 

 

 

 

 

Fair Value

 

 

 

 

 

Impairment

 

 

Net of

 

 

Impairment

 

 

Net of

 

 

 

Hierarchy

 

Charge

 

 

Impairment

 

 

Charge

 

 

Impairment

 

Real estate inventories

 

Level 3

 

$

1,073

 

 

$

20,409

 

 

$

931

 

 

$

20,329

 

 

Commitments and Contingencies
Commitments and Contingencies

15.

Commitments and Contingencies

Legal Matters

Lawsuits, claims and proceedings have been and may be instituted or asserted against us in the normal course of business, including actions brought on behalf of various classes of claimants. We are also subject to local, state and federal laws and regulations related to land development activities, house construction standards, sales practices, employment practices and environmental protection. As a result, we are subject to periodic examinations or inquiry by agencies administering these laws and regulations.

We record a reserve for potential legal claims and regulatory matters when they are probable of occurring and a potential loss is reasonably estimable. We accrue for these matters based on facts and circumstances specific to each matter and revise these estimates when necessary.  In view of the inherent difficulty of predicting outcomes of legal claims and related contingencies, we generally cannot predict their ultimate resolution, related timing or eventual loss. Accordingly, it is possible that the ultimate outcome of any matter, if in excess of a related accrual or if no accrual was made, could be material to our financial statements. For matter as to which the Company believes a loss is probable and reasonably estimable, it had legal reserves of $468,000 and $273,000 at September 30, 2015 and December 31, 2014, respectively.

Warranty

Warranty reserves are accrued as home deliveries occur. Our warranty reserves on homes delivered will vary based on product type and geographic area and also depending on state and local laws. The warranty reserve is included in accrued expenses and other liabilities on our consolidated balance sheets and represents expected future costs based on our historical experience over previous years. Estimated warranty costs are charged to cost of home sales in the period in which the related home sales revenue is recognized.

We maintain general liability insurance designed to protect us against a portion of our risk of loss from construction-related claims. We also generally require our subcontractors and design professionals to indemnify us for liabilities arising from their work, subject to various limitations. However, such indemnity is significantly limited with respect to certain subcontractors that are added to our general liability insurance policy. Included in our warranty reserve accrual are allowances to cover our estimated costs of self-insured retentions and deductible amounts under these policies and estimated costs for claims that may not be covered by applicable insurance or indemnities.  Estimation of these accruals include consideration of our claims history, including current claims and estimates of claims incurred but not yet reported.  In addition, we record expected recoveries from insurance carriers when proceeds are probable and estimable.  Outstanding warranty insurance receivables were $10.5 million and $10.0 million as of September 30, 2015 and December 31, 2014, respectively. Warranty insurance receivables are recorded in receivables on the accompanying consolidated balance sheet.

There can be no assurance that the terms and limitations of the limited warranty will be effective against claims made by homebuyers, that we will be able to renew our insurance coverage or renew it at reasonable rates, that we will not be liable for damages, cost of repairs, and/or the expense of litigation surrounding possible construction defects, soil subsidence or building related claims or that claims will not arise out of uninsurable events or circumstances not covered by insurance and not subject to effective indemnification agreements with certain subcontractors.

Warranty reserves consisted of the following (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Warranty reserves, beginning of period

 

$

35,375

 

 

$

24,324

 

 

$

33,270

 

 

$

24,449

 

Warranty reserves accrued

 

 

4,201

 

 

 

3,691

 

 

 

10,427

 

 

 

7,455

 

Liabilities assumed in the Merger

 

 

 

 

 

7,481

 

 

 

 

 

 

7,481

 

Adjustments to pre-existing reserves

 

 

(14

)

 

 

(809

)

 

 

1,286

 

 

 

209

 

Warranty expenditures

 

 

(2,819

)

 

 

(2,596

)

 

 

(8,240

)

 

 

(7,503

)

Warranty reserves, end of period

 

$

36,743

 

 

$

32,091

 

 

$

36,743

 

 

$

32,091

 

 

Performance Bonds

We obtain surety bonds in the normal course of business to ensure completion of certain infrastructure improvements of our projects. As of September 30, 2015 and December 31, 2014, the Company had outstanding surety bonds totaling $422.3 million and $355.2 million, respectively. The beneficiaries of the bonds are various municipalities.

 

Stock-Based Compensation
Stock-Based Compensation

16.

Stock-Based Compensation

2013 Long-Term Incentive Plan

The Company’s stock compensation plan, the 2013 Long-Term Incentive Plan (the “2013 Incentive Plan”), was adopted by TRI Pointe in January 2013 and amended with the approval of our stockholders in 2014. The 2013 Incentive Plan provides for the grant of equity-based awards, including options to purchase shares of common stock, stock appreciation rights, common stock, restricted stock, restricted stock units and performance awards. The 2013 Incentive Plan will automatically expire on the tenth anniversary of its effective date. Our board of directors may terminate or amend the 2013 Incentive Plan at any time, subject to any requirement of stockholder approval required by applicable law, rule or regulation.

As amended, the number of shares of our common stock that may be issued under the 2013 Incentive Plan is 11,727,833 shares. To the extent that shares of our common stock subject to an outstanding option, stock appreciation right, stock award or performance award granted under the 2013 Incentive Plan are not issued or delivered by reason of the expiration, termination, cancellation or forfeiture of such award or the settlement of such award in cash, then such shares of our common stock generally shall again be available under the 2013 Incentive Plan. As of September 30, 2015 there were 9,563,491 shares available for future grant under the 2013 Incentive Plan.

Converted Awards

Under the Transaction Agreement, each outstanding Weyerhaeuser equity award held by an employee of WRECO was converted into a similar equity award with TRI Pointe, based on the final exchange ratio of 2.1107 (the “Exchange Ratio”), rounded down to the nearest whole number of shares of common stock. The Company filed a registration statement on Form S-8 (Registration No. 333-197461) on July 16, 2014 to register 4,105,953 shares related to these equity awards. The converted awards have the same terms and conditions as the Weyerhaeuser equity awards except that all performance share units were surrendered in exchange for time-vesting restricted stock units without any performance-based vesting conditions or requirements and the exercise price of each converted stock option is equal to the original exercise price divided by the Exchange Ratio. There will be no future grants under the WRECO equity incentive plans.  Refer to Note 2, Merger with Weyerhaeuser Real Estate Company, for additional information on the Merger.

The following table presents compensation expense recognized related to all stock-based awards (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Total stock-based compensation

 

$

2,994

 

 

$

3,547

 

 

$

8,536

 

 

$

6,250

 

 

As of September 30, 2015, total unrecognized stock-based compensation related to all stock-based awards was $19.2 million and the weighted average term over which the expense was expected to be recognized was 1.90 years.

Summary of Stock Option Activity

The following table presents a summary of stock option awards for the nine months ended September 30, 2015:

 

 

 

 

 

 

 

Weighted

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

Average

 

 

Average

 

 

Aggregate

 

 

 

 

 

 

 

Exercise

 

 

Remaining

 

 

Intrinsic

 

 

 

 

 

 

 

Price

 

 

Contractual

 

 

Value

 

 

 

Options

 

 

Per Share

 

 

Life

 

 

(in thousands)

 

Options outstanding at December 31, 2014

 

 

3,467,086

 

 

$

13.05

 

 

 

6.0

 

 

$

7,642

 

Granted

 

 

 

 

 

 

 

 

 

 

 

 

Exercised

 

 

(171,716

)

 

 

11.54

 

 

 

 

 

 

 

 

 

Forfeited

 

 

(65,356

)

 

 

14.00

 

 

 

 

 

 

 

 

 

Options outstanding at September 30, 2015

 

 

3,230,014

 

 

 

13.12

 

 

 

5.2

 

 

 

 

Options exercisable at September 30, 2015

 

 

2,791,472

 

 

 

12.42

 

 

 

4.7

 

 

 

1,884

 

 

Summary of Restricted Stock Unit Activity

The following table presents a summary of restricted stock units (“RSUs”) for the nine months ended September 30, 2015:

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

Average

 

 

Aggregate

 

 

 

Restricted

 

 

Grant Date

 

 

Intrinsic

 

 

 

Stock

 

 

Fair Value

 

 

Value

 

 

 

Units

 

 

Per Share

 

 

(in thousands)

 

Nonvested RSUs at December 31, 2014

 

 

900,547

 

 

$

15.62

 

 

$

13,461

 

Granted

 

 

1,580,499

 

 

 

11.59

 

 

 

18,315

 

Vested

 

 

(453,685

)

 

 

13.85

 

 

 

 

 

Forfeited

 

 

(66,918

)

 

 

14.56

 

 

 

 

 

Nonvested RSUs at September 30, 2015

 

 

1,960,443

 

 

 

12.21

 

 

 

25,662

 

 

On March 5, 2015, the Company granted an aggregate of 440,800 restricted stock units to employees and officers. The restricted stock units granted vest annually on the anniversary of the grant date over a three year period.  The fair value of each restricted stock award granted on March 5, 2015 was measured using a price of $14.97 per share, which was the closing stock price on the date of grant.  Each award will be expensed on a straight-line basis over the vesting period.

On March 9, 2015, the Company granted 411,804, 384,351, and 274,536 performance-based RSUs to the Company’s Chief Executive Officer, President, and Chief Financial Officer, respectively, with 1/3 of the performance-based RSU amounts being allocated to each of the three following separate performance goals: total shareholder return (compared to a group of similarly sized homebuilders); earnings per share; and stock price. The performance-based restricted stock units granted will vest in each case, if at all, based on the percentage of attainment of the applicable performance goal. The performance periods for the performance-based RSUs with vesting based on total shareholder return and earnings per share are January 1, 2015 to December 31, 2017. The performance period for the performance-based RSUs with vesting based on stock price is January 1, 2016 to December 31, 2017. The fair value of the performance-based RSUs related to the total shareholder return and stock price performance goals was determined to be $7.55 and $7.90 per share, respectively, based on a Monte Carlo simulation. The fair value of the performance-based RSUs related to the earnings per share goal was measured using a price of $14.57 per share, which was the closing stock price on the date of grant. Each grant will be expensed on a straight-line basis over the expected vesting period.

 

On August 12, 2015, the Company granted an aggregate of 69,008 restricted stock units to members of its board of directors. The restricted stock units granted to directors on August 12, 2015 vest in their entirety on the day immediately prior to the Company’s 2016 Annual Meeting of Stockholders. The fair value of each restricted stock award granted on August 12, 2015 was measured using $14.49 per share, which was the closing price on the date of grant. Each award will be expensed on a straight-line basis over the vesting period.

As restricted stock units vest, a portion of the shares awarded is generally withheld to cover employee taxes. As a result, the number of restricted stock units vested and the number of shares of TRI Pointe common stock issued will differ.

 

Income Taxes
Income Taxes

17.

Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”), which requires an asset and liability approach for measuring deferred taxes based on temporary differences between the financial statements and tax bases of assets and liabilities using enacted tax rates for the years in which taxes are expected to be paid or recovered.  Each quarter we assess our deferred tax asset to determine whether all or any portion of the asset is more likely than not unrealizable under ASC 740.  We are required to establish a valuation allowance for any portion of the asset we conclude is more likely than not to be unrealizable.  Our assessment considers, among other things, the nature, frequency and severity of our current and cumulative losses, forecasts of our future taxable income, the duration of statutory carryforward periods and tax planning alternatives.

We had net deferred tax assets of $141.5 million and $157.8 million as of September 30, 2015 and December 31, 2014, respectively.  We had a valuation allowance related to those net deferred tax assets of $4.3 million and $6.2 million as of September 30, 2015 and December 31, 2014, respectively.  The Company will continue to evaluate both positive and negative evidence in determining the need for a valuation allowance against its deferred tax assets. Changes in positive and negative evidence, including differences between the Company's future operating results and the estimates utilized in the determination of the valuation allowance, could result in changes in the Company's estimate of the valuation allowance against its deferred tax assets. The accounting for deferred taxes is based upon estimates of future results. Differences between the anticipated and actual outcomes of these future results could have a material impact on the Company's consolidated results of operations or financial position. Also, changes in existing federal and state tax laws and tax rates could affect future tax results and the valuation allowance against the Company's deferred tax assets.

Our provision for income taxes totaled $28.0 million and $6.0 million for the three months ended September 30, 2015 and 2014, respectively.  Our provision for income taxes totaled $66.1 million and $16.4 million for the nine months ended September 30, 2015 and 2014, respectively.  The Company classifies any interest and penalties related to income taxes assessed by jurisdiction as part of income tax expense.  The Company had $16.6 million and $13.8 million of liabilities for uncertain tax positions recorded as of September 30, 2015 and December 31, 2014, respectively.  The Company has not been assessed interest or penalties by any major tax jurisdictions related to prior years. 

 

Related Party Transactions
Related Party Transactions

18.

Related Party Transactions

Prior to the Merger, WRECO was a wholly owned subsidiary of Weyerhaeuser.  Weyerhaeuser provided certain services including payroll processing and related employee benefits, other corporate services such as corporate governance, cash management and other treasury services, administrative services such as government relations, tax, internal audit, legal, accounting, human resources and equity-based compensation plan administration, lease of office space, aviation services and insurance coverage. WRECO was allocated a portion of Weyerhaeuser corporate general and administrative costs on either a proportional cost or usage basis.

Weyerhaeuser-allocated corporate general and administrative expenses were as follows (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

 

2015

 

 

 

2014

 

 

 

2015

 

 

 

2014

 

Weyerhaeuser-allocated costs

 

$

 

 

$

 

 

$

 

 

$

10,735

 

 

These expenses are not indicative of the actual level of expense WRECO would have incurred if it had operated as an independent company or of expenses expected to be incurred in the future after the Closing Date.

TRI Pointe has certain liabilities with Weyerhaeuser related to a tax sharing agreement.   As of September 30, 2015 and December 31, 2014, we had an income tax liability to Weyerhaeuser of $8.6 million and $15.7 million, respectively, which is recorded in accrued expenses and other liabilities on the accompanying balance sheet.

In January of 2015, TRI Pointe acquired 46 lots located in Castle Rock, Colorado, for a purchase price of approximately $2.8 million from an entity managed by an affiliate of the Starwood Capital Group. The chairman of the Company’s board of directors is Barry Sternlicht who is also the chairman of the Starwood Capital Group.  This acquisition was approved by TRI Pointe independent directors.

 

Supplemental Disclosure to Consolidated Statements of Cash Flow
Supplemental Disclosure to Consolidated Statements of Cash Flow

19.

Supplemental Disclosure to Consolidated Statements of Cash Flow

The following are supplemental disclosures to the consolidated statements of cash flows (in thousands):

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2015

 

 

2014

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

Cash paid during the period for:

 

 

 

 

 

 

 

 

Interest, net of amounts capitalized

 

$

 

 

$

1,372

 

Income taxes

 

$

44,394

 

 

$

14,962

 

Supplemental disclosures of noncash activities:

 

 

 

 

 

 

 

 

Increase in real estate inventory due to distribution of land

   from an unconsolidated joint venture

 

$

 

 

$

5,132

 

Distribution to Weyerhaeuser of excluded assets and

   liabilities

 

$

 

 

$

125,019

 

Amounts owed to Weyerhaeuser related to the tax sharing

   agreement

 

$

 

 

$

15,688

 

Noncash settlement of debt payable to Weyerhaeuser

 

$

 

 

$

70,082

 

Accrued liabilities related to the purchase of operating

   properties and equipment

 

$

1,877

 

 

$

 

Amortization of senior note discount

 

$

1,155

 

 

$

 

Effect of net consolidation and de-consolidation of

   variable interest entities:

 

 

 

 

 

 

 

 

(Decrease) increase in consolidated real estate

   inventory not owned

 

$

(3,556

)

 

$

4,497

 

Increase in accrued expenses and other liabilities

 

$

300

 

 

$

 

Decrease (increase) in noncontrolling interests

 

$

3,256

 

 

$

(4,497

)

 

Supplemental Guarantor Information
Supplemental Guarantor Information

20.

Supplemental Guarantor Information

On the Closing Date, the TRI Pointe Homes assumed WRECO’s obligations as issuer of the Senior Notes.  Additionally, all of TRI Pointe’s wholly owned subsidiaries that are guarantors of the Company’s unsecured $550 million revolving credit facility, including WRECO and certain of its wholly owned subsidiaries, entered into supplemental indentures pursuant to which they jointly and severally guaranteed TRI Pointe’s obligations with respect to the Senior Notes.  In connection with the Reorganization, TRI Pointe Group became a co-issuer with TRI Pointe Homes of the Senior Notes.

Presented below are the condensed consolidating balance sheets at September 30, 2015 and December 31, 2014, condensed consolidating statements of operations for the three and nine months ended September 30, 2015 and 2014 and condensed consolidating statement of cash flows for the nine month periods ended September 30, 2015 and 2014.  TRI Pointe’s non-guarantor subsidiaries represent less than 3% on an individual and aggregate basis of consolidated total assets, total revenues, and income from operations before taxes and cash flow from operating activities.  Therefore, the non-guarantor subsidiaries’ information is not separately presented in the tables below, but included with the guarantor subsidiaries.

As discussed in Note 1, the Merger was treated as a “reverse acquisition” with WRECO being considered the accounting acquirer.  Accordingly, the financial statements reflect the historical results of WRECO for all periods and do not include the historical financial information of TRI Pointe prior to the Closing Date.  Subsequent to the Closing Date, the consolidated financial statements reflect the results of the combined company.  

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Balance Sheet (in thousands):

 

 

 

September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

37,015

 

 

$

59,978

 

 

$

 

 

$

96,993

 

Receivables

 

 

11,225

 

 

 

21,696

 

 

 

 

 

 

32,921

 

Intercompany receivables

 

 

872,290

 

 

 

 

 

 

(872,290

)

 

 

 

Real estate inventories

 

 

675,914

 

 

 

1,900,488

 

 

 

 

 

 

2,576,402

 

Investments in unconsolidated entities

 

 

 

 

 

17,340

 

 

 

 

 

 

17,340

 

Goodwill and other intangible assets, net

 

 

162,162

 

 

 

 

 

 

 

 

 

162,162

 

Investments in subsidiaries

 

 

1,045,130

 

 

 

 

 

 

(1,045,130

)

 

 

 

Deferred tax assets

 

 

23,630

 

 

 

117,849

 

 

 

 

 

 

141,479

 

Other assets

 

 

76,629

 

 

 

7,887

 

 

 

 

 

 

84,516

 

Total Assets

 

$

2,903,995

 

 

$

2,125,238

 

 

$

(1,917,420

)

 

$

3,111,813

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

14,821

 

 

$

52,926

 

 

$

 

 

$

67,747

 

Intercompany payables

 

 

 

 

 

872,290

 

 

 

(872,290

)

 

 

 

Accrued expenses and other liabilities

 

 

67,777

 

 

 

142,930

 

 

 

 

 

 

210,707

 

Unsecured revolving credit facility

 

 

349,392

 

 

 

 

 

 

 

 

 

349,392

 

Seller financed loans

 

 

7,172

 

 

 

400

 

 

 

 

 

 

7,572

 

Senior notes

 

 

888,657

 

 

 

 

 

 

 

 

 

888,657

 

Total Liabilities

 

 

1,327,819

 

 

 

1,068,546

 

 

 

(872,290

)

 

 

1,524,075

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

 

1,576,176

 

 

 

1,045,130

 

 

 

(1,045,130

)

 

 

1,576,176

 

Noncontrolling interests

 

 

 

 

 

11,562

 

 

 

 

 

 

11,562

 

Total Equity

 

 

1,576,176

 

 

 

1,056,692

 

 

 

(1,045,130

)

 

 

1,587,738

 

Total Liabilities and Equity

 

$

2,903,995

 

 

$

2,125,238

 

 

$

(1,917,420

)

 

$

3,111,813

 

 

 

(1)

 References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Balance Sheet (in thousands):

 

 

 

December 31, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

105,888

 

 

$

64,741

 

 

$

 

 

$

170,629

 

Receivables

 

 

5,050

 

 

 

15,068

 

 

 

 

 

 

20,118

 

Intercompany receivables

 

 

797,480

 

 

 

 

 

 

(797,480

)

 

 

 

Real estate inventories

 

 

613,665

 

 

 

1,666,518

 

 

 

 

 

 

2,280,183

 

Investments in unconsolidated entities

 

 

 

 

 

16,805

 

 

 

 

 

 

16,805

 

Goodwill and other intangible assets, net

 

 

156,603

 

 

 

5,960

 

 

 

 

 

 

162,563

 

Investments in subsidiaries

 

 

941,397

 

 

 

 

 

 

(941,397

)

 

 

 

Deferred tax assets

 

 

23,630

 

 

 

134,191

 

 

 

 

 

 

157,821

 

Other assets

 

 

55,199

 

 

 

50,206

 

 

 

 

 

 

105,405

 

Total Assets

 

$

2,698,912

 

 

$

1,953,489

 

 

$

(1,738,877

)

 

$

2,913,524

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

25,800

 

 

$

43,060

 

 

$

 

 

$

68,860

 

Intercompany payables

 

 

 

 

 

797,480

 

 

 

(797,480

)

 

 

 

Accrued expenses and other liabilities

 

 

57,353

 

 

 

152,656

 

 

 

 

 

 

210,009

 

Unsecured revolving credit facility

 

 

260,000

 

 

 

 

 

 

 

 

 

260,000

 

Seller financed loans

 

 

14,077

 

 

 

600

 

 

 

 

 

 

14,677

 

Senior notes

 

 

887,502

 

 

 

 

 

 

 

 

 

887,502

 

Total Liabilities

 

 

1,244,732

 

 

 

993,796

 

 

 

(797,480

)

 

 

1,441,048

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

 

1,454,180

 

 

 

941,397

 

 

 

(941,397

)

 

 

1,454,180

 

Noncontrolling interests

 

 

 

 

 

18,296

 

 

 

 

 

 

18,296

 

Total Equity

 

 

1,454,180

 

 

 

959,693

 

 

 

(941,397

)

 

 

1,472,476

 

Total Liabilities and Equity

 

$

2,698,912

 

 

$

1,953,489

 

 

$

(1,738,877

)

 

$

2,913,524

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Three Months Ended September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

224,244

 

 

$

418,108

 

 

$

 

 

$

642,352

 

Land and lot sales

 

 

 

 

 

4,876

 

 

 

 

 

 

4,876

 

Other operations

 

 

 

 

 

913

 

 

 

 

 

 

913

 

Total revenues

 

 

224,244

 

 

 

423,897

 

 

 

 

 

 

648,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

182,754

 

 

 

324,789

 

 

 

 

 

 

507,543

 

Cost of land and lot sales

 

 

 

 

 

3,451

 

 

 

 

 

 

3,451

 

Other operations

 

 

 

 

 

570

 

 

 

 

 

 

570

 

Sales and marketing

 

 

7,286

 

 

 

22,752

 

 

 

 

 

 

30,038

 

General and administrative

 

 

12,942

 

 

 

13,841

 

 

 

 

 

 

26,783

 

Restructuring charges

 

 

(83

)

 

 

2,093

 

 

 

 

 

 

2,010

 

Total expenses

 

 

202,899

 

 

 

367,496

 

 

 

 

 

 

570,395

 

Income from operations

 

 

21,345

 

 

 

56,401

 

 

 

 

 

 

77,746

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(3

)

 

 

 

 

 

(3

)

Other income, net

 

 

(37

)

 

 

84

 

 

 

 

 

 

47

 

Income before taxes

 

 

21,308

 

 

 

56,482

 

 

 

 

 

 

77,790

 

Provision for income taxes

 

 

(9,070

)

 

 

(18,951

)

 

 

 

 

 

(28,021

)

Equity of net income of subsidiaries

 

 

37,924

 

 

 

 

 

 

(37,924

)

 

 

 

Net income

 

 

50,162

 

 

 

37,531

 

 

 

(37,924

)

 

 

49,769

 

Net loss attributable to noncontrolling interests

 

 

 

 

 

393

 

 

 

 

 

 

393

 

Net income available to common stockholders

 

$

50,162

 

 

$

37,924

 

 

$

(37,924

)

 

$

50,162

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Three Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

123,456

 

 

$

348,345

 

 

$

 

 

$

471,801

 

Land and lot sales

 

 

 

 

 

5,550

 

 

 

 

 

 

5,550

 

Other operations

 

 

(11

)

 

 

580

 

 

 

 

 

 

569

 

Total revenues

 

 

123,445

 

 

 

354,475

 

 

 

 

 

 

477,920

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

108,687

 

 

 

276,713

 

 

 

 

 

 

385,400

 

Cost of land and lot sales

 

 

 

 

 

2,317

 

 

 

 

 

 

2,317

 

Other operations

 

 

 

 

 

556

 

 

 

 

 

 

556

 

Sales and marketing

 

 

3,956

 

 

 

24,437

 

 

 

 

 

 

28,393

 

General and administrative

 

 

7,246

 

 

 

13,705

 

 

 

 

 

 

20,951

 

Restructuring charges

 

 

 

 

 

7,024

 

 

 

 

 

 

7,024

 

Total expenses

 

 

119,889

 

 

 

324,752

 

 

 

 

 

 

444,641

 

Income from operations

 

 

3,556

 

 

 

29,723

 

 

 

 

 

 

33,279

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(82

)

 

 

 

 

 

(82

)

Transaction expenses

 

 

(6,381

)

 

 

(10,329

)

 

 

 

 

 

 

(16,710

)

Other income, net

 

 

9

 

 

 

490

 

 

 

 

 

 

499

 

(Loss) income before taxes

 

 

(2,816

)

 

 

19,802

 

 

 

 

 

 

16,986

 

Benefit (provision) for income taxes

 

 

2,032

 

 

 

(8,053

)

 

 

 

 

 

(6,021

)

Equity of net income of subsidiaries

 

 

11,749

 

 

 

 

 

 

(11,749

)

 

 

 

Net income available to common stockholders

 

$

10,965

 

 

$

11,749

 

 

$

(11,749

)

 

$

10,965

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Nine Months Ended September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

461,654

 

 

$

982,201

 

 

$

 

 

$

1,443,855

 

Land and lot sales

 

 

 

 

 

74,366

 

 

 

 

 

 

74,366

 

Other operations

 

 

 

 

 

2,695

 

 

 

 

 

 

2,695

 

Total revenues

 

 

461,654

 

 

 

1,059,262

 

 

 

 

 

 

1,520,916

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

376,100

 

 

 

773,091

 

 

 

 

 

 

1,149,191

 

Cost of land and lot sales

 

 

 

 

 

17,324

 

 

 

 

 

 

17,324

 

Other operations

 

 

 

 

 

1,724

 

 

 

 

 

 

1,724

 

Sales and marketing

 

 

17,714

 

 

 

61,244

 

 

 

 

 

 

78,958

 

General and administrative

 

 

38,874

 

 

 

44,387

 

 

 

 

 

 

83,261

 

Restructuring charges

 

 

(169

)

 

 

2,899

 

 

 

 

 

 

2,730

 

Total expenses

 

 

432,519

 

 

 

900,669

 

 

 

 

 

 

1,333,188

 

Income from operations

 

 

29,135

 

 

 

158,593

 

 

 

 

 

 

187,728

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(84

)

 

 

 

 

 

(84

)

Other (loss) income, net

 

 

(149

)

 

 

421

 

 

 

 

 

 

272

 

Income before taxes

 

 

28,986

 

 

 

158,930

 

 

 

 

 

 

187,916

 

Provision for income taxes

 

 

(12,285

)

 

 

(53,803

)

 

 

 

 

 

(66,088

)

Equity of net income of subsidiaries

 

 

103,688

 

 

 

 

 

 

(103,688

)

 

 

 

Net income

 

 

120,389

 

 

 

105,127

 

 

 

(103,688

)

 

 

121,828

 

Net income attributable to noncontrolling interests

 

 

 

 

 

(1,439

)

 

 

 

 

 

(1,439

)

Net income available to common stockholders

 

$

120,389

 

 

$

103,688

 

 

$

(103,688

)

 

$

120,389

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Nine Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

123,456

 

 

$

899,856

 

 

$

 

 

$

1,023,312

 

Land and lot sales

 

 

 

 

 

36,449

 

 

 

 

 

 

36,449

 

Other operations

 

 

(11

)

 

 

8,865

 

 

 

 

 

 

8,854

 

Total revenues

 

 

123,445

 

 

 

945,170

 

 

 

 

 

 

1,068,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

108,687

 

 

 

710,690

 

 

 

 

 

 

819,377

 

Cost of land and lot sales

 

 

 

 

 

30,245

 

 

 

 

 

 

30,245

 

Other operations

 

 

 

 

 

2,755

 

 

 

 

 

 

2,755

 

Sales and marketing

 

 

3,956

 

 

 

69,140

 

 

 

 

 

 

73,096

 

General and administrative

 

 

7,246

 

 

 

49,894

 

 

 

 

 

 

57,140

 

Restructuring charges

 

 

 

 

 

9,202

 

 

 

 

 

 

9,202

 

Total expenses

 

 

119,889

 

 

 

871,926

 

 

 

 

 

 

991,815

 

Income from operations

 

 

3,556

 

 

 

73,244

 

 

 

 

 

 

76,800

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(219

)

 

 

 

 

 

(219

)

Transaction expenses

 

 

(6,381

)

 

 

(10,835

)

 

 

 

 

 

 

(17,216

)

Other income (loss), net

 

 

9

 

 

 

(251

)

 

 

 

 

 

(242

)

(Loss) income before taxes

 

 

(2,816

)

 

 

61,939

 

 

 

 

 

 

59,123

 

Benefit (provision) for income taxes

 

 

2,032

 

 

 

(18,384

)

 

 

 

 

 

(16,352

)

Equity of net income of subsidiaries

 

 

43,555

 

 

 

 

 

 

(43,555

)

 

 

 

Net income available to common stockholders

 

$

42,771

 

 

$

43,555

 

 

$

(43,555

)

 

$

42,771

 

 

 

(1)

 References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Cash Flows (in thousands):

 

 

 

Nine Months Ended September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

$

(69,362

)

 

$

(70,649

)

 

$

 

 

$

(140,011

)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(382

)

 

 

(677

)

 

 

 

 

 

(1,059

)

Investments in unconsolidated entities

 

 

 

 

 

(1,458

)

 

 

 

 

 

(1,458

)

Distributions from unconsolidated entities

 

 

 

 

 

319

 

 

 

 

 

 

319

 

Intercompany

 

 

(78,354

)

 

 

 

 

 

78,354

 

 

 

 

Net cash used in investing activities

 

 

(78,736

)

 

 

(1,816

)

 

 

78,354

 

 

 

(2,198

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings from debt

 

 

140,000

 

 

 

 

 

 

 

 

 

140,000

 

Repayment of debt

 

 

(57,513

)

 

 

(200

)

 

 

 

 

 

(57,713

)

Debt issuance costs

 

 

(2,688

)

 

 

 

 

 

 

 

 

(2,688

)

Net proceeds (repayments) of debt held by variable interest

   entities

 

 

 

 

 

(5,927

)

 

 

 

 

 

(5,927

)

Contributions from noncontrolling interests

 

 

 

 

 

4,281

 

 

 

 

 

 

4,281

 

Distributions to noncontrolling interests

 

 

 

 

 

(9,198

)

 

 

 

 

 

(9,198

)

Proceeds from issuance of common stock under share-based

   awards

 

 

1,616

 

 

 

 

 

 

 

 

 

1,616

 

Excess tax benefits of share-based awards

 

 

 

 

 

392

 

 

 

 

 

 

392

 

Minimum tax withholding paid on behalf of employees for

   restricted stock units

 

 

(2,190

)

 

 

 

 

 

 

 

 

(2,190

)

Intercompany

 

 

 

 

 

78,354

 

 

 

(78,354

)

 

 

 

Net cash provided by financing activities

 

 

79,225

 

 

 

67,702

 

 

 

(78,354

)

 

 

68,573

 

Net decrease in cash and cash equivalents

 

 

(68,873

)

 

 

(4,763

)

 

 

 

 

 

(73,636

)

Cash and cash equivalents - beginning of period

 

 

105,888

 

 

 

64,741

 

 

 

 

 

 

170,629

 

Cash and cash equivalents - end of period

 

$

37,015

 

 

$

59,978

 

 

$

 

 

$

96,993

 

 

 

(1)

 References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Cash Flows (in thousands):

 

 

 

Nine Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

$

(26,882

)

 

$

(113,547

)

 

$

 

 

$

(140,429

)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(659

)

 

 

(5,409

)

 

 

 

 

 

(6,068

)

Cash acquired in the Merger

 

 

53,800

 

 

 

 

 

 

 

 

 

53,800

 

Proceeds from sale of property and equipment

 

 

 

 

 

22

 

 

 

 

 

 

22

 

Investments in unconsolidated entities

 

 

 

 

 

(573

)

 

 

 

 

 

(573

)

Intercompany

 

 

(850,977

)

 

 

 

 

 

850,977

 

 

 

 

Net cash used in investing activities

 

 

(797,836

)

 

 

(5,960

)

 

 

850,977

 

 

 

47,181

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings from debt

 

 

50,000

 

 

 

 

 

 

 

 

 

50,000

 

Debt issuance costs

 

 

(23,003

)

 

 

 

 

 

 

 

 

(23,003

)

Proceeds from issuance of senior notes

 

 

886,698

 

 

 

 

 

 

 

 

 

886,698

 

Bridge commitment fee

 

 

 

 

 

(10,322

)

 

 

 

 

 

(10,322

)

Changes in debt payable to Weyerhaeuser

 

 

 

 

 

(623,589

)

 

 

 

 

 

(623,589

)

Change in book overdrafts

 

 

 

 

 

(22,492

)

 

 

 

 

 

(22,492

)

Distributions to Weyerhaeuser

 

 

 

 

 

(8,860

)

 

 

 

 

 

(8,860

)

Net proceeds (repayments) of debt held by variable interest

   entities

 

 

 

 

 

5,120

 

 

 

 

 

 

5,120

 

Distributions to noncontrolling interests

 

 

 

 

 

(18,703

)

 

 

 

 

 

(18,703

)

Excess tax benefits of share-based awards

 

 

 

 

 

1,572

 

 

 

 

 

 

1,572

 

Intercompany

 

 

 

 

 

 

850,977

 

 

 

(850,977

)

 

 

 

Net cash provided by financing activities

 

 

913,695

 

 

 

173,703

 

 

 

(850,977

)

 

 

236,421

 

Net increase in cash and cash equivalents

 

 

88,977

 

 

 

54,196

 

 

 

 

 

 

143,173

 

Cash and cash equivalents - beginning of period

 

 

 

 

 

4,510

 

 

 

 

 

 

4,510

 

Cash and cash equivalents - end of period

 

$

88,977

 

 

$

58,706

 

 

$

 

 

$

147,683

 

 

 

(1)

References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

Organization, Basis of Presentation and Summary of Significant Accounting Policies (Policies)

Organization

The Company is engaged in the design, construction and sale of innovative single-family homes through its portfolio of six quality brands across eight states, including Maracay Homes in Arizona, Pardee Homes in California and Nevada, Quadrant Homes in Washington, Trendmaker Homes in Texas, TRI Pointe Homes in California and Colorado and Winchester Homes in Maryland and Virginia.  

Reorganization

On July 7, 2015, TRI Pointe Homes, Inc., a Delaware corporation, (“TRI Pointe Homes”) reorganized its corporate structure (the “Reorganization”) whereby TRI Pointe Homes became a direct, wholly owned subsidiary of TRI Pointe Group, Inc., a Delaware corporation (“TRI Pointe Group”).  See “Note Regarding This Quarterly Report” for information concerning the reorganization effected on July 7, 2015.

Basis of Presentation

The accompanying financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”).

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries as described in “Reverse Acquisition” below, as well as other entities in which the Company has a controlling interest and variable interest entities (“VIEs”) in which the Company is the primary beneficiary.  The noncontrolling interests as of September 30, 2015 and December 31, 2014 represent the outside owners’ interests in the Company’s consolidated entities and the net equity of the VIE owners.  All significant intercompany accounts have been eliminated upon consolidation.  Subsequent events have been evaluated through the date the financial statements were issued.  In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation with respect to interim financial statements, have been included.

The Company has historically experienced, and expects to continue to experience, variability in quarterly results. The results of operations for the three or nine months ended September 30, 2015 are not necessarily indicative of the results to be expected for the full year.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These financial statements should be read in conjunction with our consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2014.

Reverse Acquisition

On July 7, 2014 (the “Closing Date”), TRI Pointe consummated the previously announced merger (the “Merger”) of our wholly owned subsidiary, Topaz Acquisition, Inc. (“Merger Sub”), with and into Weyerhaeuser Real Estate Company (“WRECO”), with WRECO surviving the Merger and becoming our wholly owned subsidiary, as contemplated by the Transaction Agreement, dated as of November 3, 2013 (the “Transaction Agreement”), by and among us, Weyerhaeuser Company (“Weyerhaeuser”), WRECO and Merger Sub. The Merger is accounted for in accordance with ASC Topic 805, Business Combinations (“ASC 805”). For accounting purposes, the Merger is treated as a “reverse acquisition” and WRECO is considered the accounting acquirer. Accordingly, WRECO is reflected as the predecessor and acquirer and therefore the accompanying consolidated financial statements reflect the historical consolidated financial statements of WRECO for all periods presented and do not include the historical financial statements of TRI Pointe prior to the Closing Date. Subsequent to the Closing Date, the consolidated financial statements reflect the results of the combined company.

See Note 2, Merger with Weyerhaeuser Real Estate Company, for further information on the Merger. In the Merger, each issued and outstanding WRECO common share was converted into 1.297 shares of TRI Pointe common stock. The historical issued and outstanding WRECO common shares (100,000,000 common shares for all periods presented prior to the Merger) have been recast (as 129,700,000 common shares of the Company for all periods prior to the Merger) in all periods presented to reflect this conversion.

Use of Estimates

The preparation of these financial statements requires our management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosures of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from our estimates.

Recently Issued Accounting Standards

In April 2014, the FASB issued amendments to Accounting Standards Update 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. The update requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s financial results or a business activity classified as held for sale should be reported as discontinued operations. The amendments also expand the disclosure requirements for discontinued operations and add new disclosures for individually significant dispositions that do not qualify as discontinued operations. We adopted ASU 2014-08 on January 1, 2015 and the adoption had no impact on our current or prior year financial statements.

In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The core principle of ASU 2014-09 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: identify the contract(s) with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) the entity satisfies a performance obligation. ASU 2014-09 supersedes the revenue-recognition requirements in ASC Topic 605, Revenue Recognition, most industry-specific guidance throughout the industry topics of the accounting standards codification, and some cost guidance related to construction-type and production-type contracts. On July 9, 2015, the FASB voted to defer the effective date of ASU No. 2014-09 by one year and it is now effective for public entities for the annual periods ending after December 15, 2017, and for annual and interim periods thereafter.  Companies may use either a full retrospective or a modified retrospective approach to adopt ASU 2014-09.  Early adoption is permitted, but can be no earlier than the original public entity effective date of fiscal years, and the interim periods within those years, beginning after December 15, 2016.  We are currently evaluating the approach for implementation and the potential impact of adopting this guidance on our consolidated financial statements.

In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (“ASU 2014-15”), Presentation of Financial Statements — Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which requires management to evaluate, in connection with preparing financial statements for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable) and provide related disclosures. ASU 2014-15 is effective for the annual period ending after December 15, 2016, and for annual and interim periods thereafter. Early adoption is permitted. We believe the adoption of this guidance will not have a material effect on our consolidated financial statements.

In February 2015, the FASB issued Accounting Standards Update No. 2015-02, (“ASU 2015-02”), Consolidation (Topic 810): Amendments to the Consolidation Analysis.   ASU 2015-02 changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. ASU 2015-02 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. We believe the adoption of ASU 2015-02 will not have a material effect on our consolidated financial statements.

In April 2015, the FASB issued Accounting Standards Update No. 2015-03, (“ASU 2015-03”), Interest - Imputation of Interest (Subtopic 835-30), and as amended in August 2015 by Accounting Standards Update No. 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, which changes the presentation of debt issuance costs related to a recognized debt liability in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. The FASB will permit debt issuance costs related to line-of-credit agreements to be deferred and presented as an asset, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement.  Amortization of the costs is reported as interest expense.  ASU 2015-03 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. Early adoption is permitted, including adoption in an interim period. The Company plans to early adopt this guidance at the beginning of the fourth quarter of 2015.  Had the Company early adopted ASU 2015-03, the impact for the period ended September 30, 2015 on our consolidated balance sheet would have been a balance sheet reclassification of deferred loan costs currently included in Other Assets resulting in a decrease to Other Assets of $23.6 million, a decrease to Senior Notes of $21.2 million and a decrease to unsecured revolving credit facility of $2.4 million. The impact for the period ended December 31, 2014, would have been a decrease to Other Assets of $23.7 million and a decrease to Senior Notes of $23.7 million.

Reclassifications

Certain amounts in our consolidated financial statements for prior years have been reclassified to conform to the current period presentation.

In accordance with ASC Topic 280, Segment Reporting, in determining the most appropriate reportable segments, we considered similar economic and other characteristics, including product types, average selling prices, gross profits, production processes, suppliers, subcontractors, regulatory environments, land acquisition results, and underlying demand and supply.

Fair Value Measurements

ASC Topic 820, Fair Value Measurements and Disclosures, defines “fair value” as the price that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at measurement date and requires assets and liabilities carried at fair value to be classified and disclosed in the following three categories:

 

·

Level 1—Quoted prices for identical instruments in active markets

 

·

Level 2—Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are inactive; and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets at measurement date

 

·

Level 3—Valuations derived from techniques where one or more significant inputs or significant value drivers are unobservable in active markets at measurement date

Merger with Weyerhaeuser Real Estate Company (Tables)

The following table summarizes the calculation of the fair value of the total consideration transferred and the provisional amounts recognized as of the Closing Date (in thousands, except shares and closing stock price):

 

Calculation of consideration transferred

 

 

 

 

TRI Pointe shares outstanding

 

 

31,632,533

 

TRI Pointe closing stock price on July 7, 2014

 

$

15.85

 

Consideration attributable to common stock

 

$

501,376

 

Consideration attributable to TRI Pointe share-based

   equity awards

 

 

1,072

 

Total consideration transferred

 

$

502,448

 

Assets acquired and liabilities assumed

 

 

 

 

Cash and cash equivalents

 

$

53,800

 

Accounts receivable

 

 

654

 

Real estate inventories

 

 

539,677

 

Intangible asset

 

 

17,300

 

Goodwill

 

 

139,304

 

Other assets

 

 

28,060

 

Total assets acquired

 

 

778,795

 

Accounts payable

 

 

26,105

 

Accrued expenses and other liabilities

 

 

23,114

 

Notes payable and other borrowings

 

 

227,128

 

Total liabilities assumed

 

 

276,347

 

Total net assets acquired

 

$

502,448

 

 

The following represents unaudited pro forma operating results as if the acquisition had been completed as of January 1, 2014 (in thousands, except per share amounts):

 

 

 

Three Months Ended

September 30, 2014

 

 

Nine Months Ended

September 30, 2014

 

Total revenues

 

$

479,879

 

 

$

1,230,722

 

Net income

 

$

21,934

 

 

$

66,902

 

Earnings per share – basic

 

$

0.14

 

 

$

0.41

 

Earnings per share – diluted

 

$

0.14

 

 

$

0.41

 

 

Restructuring (Tables)

Restructuring costs were comprised of the following (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Employee-related costs

 

$

1,433

 

 

$

6,817

 

 

$

1,568

 

 

$

8,124

 

Lease termination costs

 

 

577

 

 

 

207

 

 

 

1,162

 

 

 

1,078

 

Total

 

$

2,010

 

 

$

7,024

 

 

$

2,730

 

 

$

9,202

 

 

Changes in employee-related restructuring reserves were as follows (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Accrued employee-related costs, beginning of

   period

 

$

109

 

 

$

 

 

$

3,844

 

 

$

4,336

 

Current year charges

 

 

1,433

 

 

 

5,550

 

 

 

1,568

 

 

 

6,857

 

Adjustments to pre-existing reserves

 

 

(83

)

 

 

 

 

 

(83

)

 

 

 

Payments

 

 

(1,004

)

 

 

(1,576

)

 

 

(4,874

)

 

 

(7,219

)

Accrued employee-related costs, end of period

 

$

455

 

 

$

3,974

 

 

$

455

 

 

$

3,974

 

 

Changes in lease termination related restructuring reserves were as follows (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Accrued lease termination costs, beginning of

   period

 

$

644

 

 

$

2,454

 

 

$

1,394

 

 

$

3,506

 

Current year charges

 

 

577

 

 

 

207

 

 

 

1,162

 

 

 

1,078

 

Payments

 

 

(705

)

 

 

(902

)

 

 

(2,040

)

 

 

(2,825

)

Accrued lease termination costs, end of period

 

$

516

 

 

$

1,759

 

 

$

516

 

 

$

1,759

 

 

Segment Information (Tables)
Summary of Financial Information Relating to Reportable Segments

Operational results of each reportable segment are not necessarily indicative of the results that would have been achieved had the reportable segment been an independent, stand-alone entity during the periods presented.

Total revenues and income before taxes for each of our reportable segments were as follows (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Total revenues

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maracay Homes

 

$

50,505

 

 

$

37,301

 

 

$

116,556

 

 

$

107,576

 

Pardee Homes

 

 

172,957

 

 

 

134,409

 

 

 

424,680

 

 

 

352,118

 

Quadrant Homes

 

 

48,173

 

 

 

32,919

 

 

 

132,698

 

 

 

96,958

 

Trendmaker Homes

 

 

81,044

 

 

 

69,711

 

 

 

203,235

 

 

 

198,867

 

TRI Pointe Homes

 

 

224,544

 

 

 

123,445

 

 

 

462,136

 

 

 

123,445

 

Winchester Homes

 

 

70,918

 

 

 

80,135

 

 

 

181,611

 

 

 

189,651

 

Total

 

$

648,141

 

 

$

477,920

 

 

$

1,520,916

 

 

$

1,068,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before taxes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Maracay Homes

 

$

3,750

 

 

$

2,212

 

 

$

5,858

 

 

$

8,222

 

Pardee Homes

 

 

39,749

 

 

 

21,787

 

 

 

121,041

 

 

 

47,580

 

Quadrant Homes

 

 

3,982

 

 

 

649

 

 

 

6,329

 

 

 

6,889

 

Trendmaker Homes

 

 

7,496

 

 

 

7,327

 

 

 

17,896

 

 

 

21,529

 

TRI Pointe Homes

 

 

29,556

 

 

 

8,685

 

 

 

55,251

 

 

 

8,685

 

Winchester Homes

 

 

1,726

 

 

 

6,941

 

 

 

8,064

 

 

 

17,978

 

Corporate

 

 

(8,469

)

 

 

(30,615

)

 

 

(26,523

)

 

 

(51,760

)

Total

 

$

77,790

 

 

$

16,986

 

 

$

187,916

 

 

$

59,123

 

 

Total real estate inventories and total assets for each of our reportable segments, as of the date indicated, were as follows (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Real estate inventories

 

 

 

 

 

 

 

 

Maracay Homes

 

$

205,432

 

 

$

153,577

 

Pardee Homes

 

 

1,013,792

 

 

 

924,362

 

Quadrant Homes

 

 

193,374

 

 

 

153,493

 

Trendmaker Homes

 

 

191,803

 

 

 

176,696

 

TRI Pointe Homes

 

 

678,564

 

 

 

613,666

 

Winchester Homes

 

 

293,437

 

 

 

258,389

 

Total

 

$

2,576,402

 

 

$

2,280,183

 

 

 

 

 

 

 

 

 

 

Total assets

 

 

 

 

 

 

 

 

Maracay Homes

 

$

221,190

 

 

$

170,932

 

Pardee Homes

 

 

1,080,599

 

 

 

1,000,489

 

Quadrant Homes

 

 

206,986

 

 

 

167,796

 

Trendmaker Homes

 

 

219,869

 

 

 

195,829

 

TRI Pointe Homes

 

 

847,013

 

 

 

781,301

 

Winchester Homes

 

 

312,932

 

 

 

281,547

 

Corporate

 

 

223,224

 

 

 

315,630

 

Total

 

$

3,111,813

 

 

$

2,913,524

 

 

Earnings Per Share (Tables)
Computation of Basic and Diluted Earnings Per Share

The following table sets forth the components used in the computation of basic and diluted earnings per share (in thousands, except share and per share amounts):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common stockholders

 

$

50,162

 

 

$

10,965

 

 

$

120,389

 

 

$

42,771

 

Denominator:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic weighted-average shares outstanding

 

 

161,772,893

 

 

 

158,931,450

 

 

 

161,651,177

 

 

 

139,550,891

 

Effect of dilutive shares:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stock options and unvested restricted

   stock units

 

 

593,851

 

 

 

227,256

 

 

 

648,105

 

 

 

662,764

 

Diluted weighted-average shares

   outstanding

 

 

162,366,744

 

 

 

159,158,706

 

 

 

162,299,282

 

 

 

140,213,655

 

Earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.31

 

 

$

0.07

 

 

$

0.74

 

 

$

0.31

 

Diluted

 

$

0.31

 

 

$

0.07

 

 

$

0.74

 

 

$

0.31

 

Antidilutive unvested restricted stock units and

   stock options not included in diluted earnings

   per share

 

 

2,260,532

 

 

 

3,634,614

 

 

 

2,462,268

 

 

 

 

 

Receivables (Tables)
Components of Receivables

Receivables consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Escrow proceeds and other accounts receivable, net

 

$

22,128

 

 

$

9,771

 

Warranty insurance receivable (Note 15)

 

 

10,493

 

 

 

10,047

 

Notes and contracts receivable

 

 

300

 

 

 

300

 

Total receivables

 

$

32,921

 

 

$

20,118

 

 

Real Estate Inventories (Tables)

Real estate inventories consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Real estate inventories owned:

 

 

 

 

 

 

 

 

Homes completed or under construction

 

$

749,852

 

 

$

461,712

 

Land under development

 

 

1,380,298

 

 

 

1,391,303

 

Land held for future development

 

 

257,610

 

 

 

245,673

 

Model homes

 

 

127,815

 

 

 

103,270

 

Total real estate inventories owned

 

 

2,515,575

 

 

 

2,201,958

 

Real estate inventories not owned:

 

 

 

 

 

 

 

 

Land purchase and land option deposits

 

 

42,329

 

 

 

44,155

 

Consolidated inventory held by VIEs

 

 

18,498

 

 

 

34,070

 

Total real estate inventories not owned

 

 

60,827

 

 

 

78,225

 

Total real estate inventories

 

$

2,576,402

 

 

$

2,280,183

 

 

Interest incurred, capitalized and expensed were as follows (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Interest incurred

 

$

15,454

 

 

$

15,129

 

 

$

45,779

 

 

$

25,718

 

Interest capitalized

 

 

(15,454

)

 

 

(14,839

)

 

 

(45,779

)

 

 

(22,987

)

Interest expensed

 

$

 

 

$

290

 

 

$

 

 

$

2,731

 

Capitalized interest in beginning inventory

 

$

140,106

 

 

$

113,765

 

 

$

124,461

 

 

$

138,233

 

Interest capitalized as a cost of inventory

 

 

15,454

 

 

 

14,839

 

 

 

45,779

 

 

 

22,987

 

Interest previously capitalized as a cost of

   inventory, included in cost of sales

 

 

(13,339

)

 

 

(7,835

)

 

 

(28,019

)

 

 

(40,451

)

Capitalized interest in ending inventory

 

$

142,221

 

 

$

120,769

 

 

$

142,221

 

 

$

120,769

 

 

Real estate inventory impairments and land option abandonments consisted of the following (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Real estate inventory impairments

 

$

29

 

 

$

248

 

 

$

1,073

 

 

$

300

 

Land and lot option abandonments and

   pre-acquisition costs

 

 

336

 

 

 

304

 

 

 

830

 

 

 

824

 

Total

 

$

365

 

 

$

552

 

 

$

1,903

 

 

$

1,124

 

 

Investments in Unconsolidated Entities (Tables)

Our cumulative investment in entities accounted for on the equity method, including our share of earnings and losses, consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Limited liability company interests

 

$

14,079

 

 

$

13,710

 

General partnership interests

 

 

3,261

 

 

 

3,095

 

Total

 

$

17,340

 

 

$

16,805

 

 

Aggregated assets, liabilities and operating results of the entities we account for as equity-method investments are provided below. Because our ownership interest in these entities varies, a direct relationship does not exist between the information presented below and the amounts that are reflected on our consolidated balance sheets as our investment in unconsolidated entities or on our consolidated statement of operations as equity in loss of unconsolidated entities.

Assets and liabilities of unconsolidated entities (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Assets

 

 

 

 

 

 

 

 

Cash

 

$

19,282

 

 

$

17,154

 

Receivables

 

 

12,916

 

 

 

9,550

 

Real estate inventories

 

 

91,712

 

 

 

95,500

 

Other assets

 

 

882

 

 

 

620

 

Total assets

 

$

124,792

 

 

$

122,824

 

Liabilities and equity

 

 

 

 

 

 

 

 

Accounts payable and other liabilities

 

$

14,293

 

 

$

10,914

 

Company’s equity

 

 

17,340

 

 

 

16,805

 

Outside interests’ equity

 

 

93,159

 

 

 

95,105

 

Total liabilities and equity

 

$

124,792

 

 

$

122,824

 

 

Results of operations from unconsolidated entities (in thousands):

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Net sales

 

$

1,217

 

 

$

184

 

 

$

2,670

 

 

$

591

 

Other operating expense

 

 

(1,479

)

 

 

(1,215

)

 

 

(4,020

)

 

 

(3,372

)

Other income

 

 

(263

)

 

 

2

 

 

 

(256

)

 

 

16

 

Net loss

 

$

(525

)

 

$

(1,029

)

 

$

(1,606

)

 

$

(2,765

)

Company’s equity in loss of unconsolidated entities

 

$

(3

)

 

$

(82

)

 

$

(84

)

 

$

(219

)

 

Variable Interest Entities (Tables)
Summary of Interests in Land Option Agreements

The following provides a summary of our interests in land option agreements (in thousands):

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

 

 

 

 

Remaining

 

 

Consolidated

 

 

 

 

 

 

Remaining

 

 

Consolidated

 

 

 

 

 

 

 

Purchase

 

 

Inventory

 

 

 

 

 

 

Purchase

 

 

Inventory

 

 

 

Deposits

 

 

Price

 

 

Held by VIEs

 

 

Deposits

 

 

Price

 

 

Held by VIEs

 

Consolidated VIEs

 

$

4,696

 

 

$

14,140

 

 

$

18,498

 

 

$

8,071

 

 

$

43,432

 

 

$

34,070

 

Unconsolidated VIEs

 

 

8,150

 

 

 

22,781

 

 

N/A

 

 

 

13,309

 

 

 

129,637

 

 

N/A

 

Other land option agreements

 

 

34,179

 

 

 

308,438

 

 

N/A

 

 

 

30,846

 

 

 

284,819

 

 

N/A

 

Total

 

$

47,025

 

 

$

345,359

 

 

$

18,498

 

 

$

52,226

 

 

$

457,888

 

 

$

34,070

 

 

Goodwill and Other Intangible Assets (Tables)

Goodwill and other intangible assets consisted of the following (in thousands):

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

Gross

 

 

 

 

 

 

Net

 

 

Gross

 

 

 

 

 

 

Net

 

 

 

Carrying

 

 

Accumulated

 

 

Carrying

 

 

Carrying

 

 

Accumulated

 

 

Carrying

 

 

 

Amount

 

 

Amortization

 

 

Amount

 

 

Amount

 

 

Amortization

 

 

Amount

 

Goodwill

 

$

139,303

 

 

$

 

 

$

139,303

 

 

$

139,304

 

 

$

 

 

$

139,304

 

Trade names

 

 

27,979

 

 

 

(5,120

)

 

 

22,859

 

 

 

27,979

 

 

 

(4,720

)

 

 

23,259

 

Total

 

$

167,282

 

 

$

(5,120

)

 

$

162,162

 

 

$

167,283

 

 

$

(4,720

)

 

$

162,563

 

 

Expected amortization of our intangible asset related to Maracay Homes for the remainder of 2015, the next four years and thereafter is (in thousands):

 

Remainder of 2015

 

$

134

 

2016

 

 

534

 

2017

 

 

534

 

2018

 

 

534

 

2019

 

 

534

 

Thereafter

 

 

3,289

 

Total

 

$

5,559

 

 

Other Assets (Tables)
Schedule of Other Assets

Other assets consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Prepaid expenses

 

$

20,989

 

 

$

29,111

 

Refundable fees and other deposits

 

 

16,576

 

 

 

15,581

 

Development rights, held for future use or sale

 

 

6,447

 

 

 

7,409

 

Deferred loan costs

 

 

23,617

 

 

 

23,686

 

Operating properties and equipment, net

 

 

8,869

 

 

 

11,719

 

Income tax receivable

 

 

1,808

 

 

 

10,713

 

Other

 

 

6,210

 

 

 

7,186

 

Total

 

$

84,516

 

 

$

105,405

 

 

Accrued Expenses and Other Liabilities (Tables)
Schedule Of Accrued Expenses And Other Liabilities

Accrued expenses and other liabilities consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Accrued payroll and related costs

 

$

21,544

 

 

$

24,717

 

Warranty reserves (Note 15)

 

 

36,743

 

 

 

33,270

 

Estimated cost for completion of real estate inventories

 

 

62,047

 

 

 

54,437

 

Customer deposits

 

 

19,734

 

 

 

14,229

 

Debt (nonrecourse) held by VIEs

 

 

3,286

 

 

 

9,512

 

Income tax liability to Weyerhaeuser (Note 18)

 

 

8,600

 

 

 

15,659

 

Liability for uncertain tax positions (Note 17)

 

 

16,563

 

 

 

13,797

 

Accrued interest

 

 

13,976

 

 

 

3,059

 

Accrued insurance expense

 

 

1,975

 

 

 

9,180

 

Other

 

 

26,239

 

 

 

32,149

 

Total

 

$

210,707

 

 

$

210,009

 

 

Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans (Tables)

Senior Notes consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

4.375% Senior Notes due June 15, 2019, net of discount

 

$

446,186

 

 

$

445,501

 

5.875% Senior Notes due June 15, 2024, net of discount

 

 

442,471

 

 

 

442,001

 

Total

 

$

888,657

 

 

$

887,502

 

 

Unsecured revolving credit facility consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Unsecured revolving credit facility

 

$

349,392

 

 

$

260,000

 

 

Seller financed loans consisted of the following (in thousands):

 

 

 

September 30,

 

 

December 31,

 

 

 

2015

 

 

2014

 

Seller financed loans

 

$

7,572

 

 

$

14,677

 

 

Fair Value Disclosures (Tables)

A summary of assets and liabilities at September 30, 2015 and December 31, 2014, related to our financial instruments, measured at fair value on a recurring basis, is set forth below (in thousands):

 

 

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

Hierarchy

 

Book Value

 

 

Fair Value

 

 

Book Value

 

 

Fair Value

 

Receivables (1)

 

Level 3

 

$

32,921

 

 

$

32,921

 

 

$

20,118

 

 

$

20,118

 

Senior Notes (2)

 

Level 2

 

 

888,657

 

 

 

878,625

 

 

 

887,502

 

 

 

896,625

 

Unsecured revolving credit facility (3)

 

Level 3

 

 

349,392

 

 

 

349,392

 

 

 

260,000

 

 

 

260,000

 

Seller financed loans (4)

 

Level 3

 

 

7,572

 

 

 

7,572

 

 

 

14,677

 

 

 

14,677

 

 

 

At September 30, 2015 and December 31, 2014, the carrying value of cash and cash equivalents approximated fair value.

(1)

The book value of our receivables equaled the fair value as of September 30, 2015 and December 31, 2014 due to the short-term nature of the remaining receivables.

(2)

The estimated fair value of our Senior Notes at September 30, 2015 and December 31, 2014 is based on quoted market prices.

(3)

We believe that the carrying value of our Credit Facility approximates fair value based on the short term nature of the current market rate amended on May 18, 2015.

(4)

We believe that the carrying value of our Seller financed loans approximates fair value based on a two year treasury curve analysis.

The following table presents impairment charges and the remaining net fair value for nonfinancial assets that were measured during the periods presented (in thousands):

 

 

 

 

 

Nine Months Ended

 

 

Year Ended

 

 

 

 

 

September 30, 2015

 

 

December 31, 2014

 

 

 

 

 

 

 

 

 

Fair Value

 

 

 

 

 

 

Fair Value

 

 

 

 

 

Impairment

 

 

Net of

 

 

Impairment

 

 

Net of

 

 

 

Hierarchy

 

Charge

 

 

Impairment

 

 

Charge

 

 

Impairment

 

Real estate inventories

 

Level 3

 

$

1,073

 

 

$

20,409

 

 

$

931

 

 

$

20,329

 

 

Commitments and Contingencies (Tables)
Schedule of Warranty Reserves

Warranty reserves consisted of the following (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Warranty reserves, beginning of period

 

$

35,375

 

 

$

24,324

 

 

$

33,270

 

 

$

24,449

 

Warranty reserves accrued

 

 

4,201

 

 

 

3,691

 

 

 

10,427

 

 

 

7,455

 

Liabilities assumed in the Merger

 

 

 

 

 

7,481

 

 

 

 

 

 

7,481

 

Adjustments to pre-existing reserves

 

 

(14

)

 

 

(809

)

 

 

1,286

 

 

 

209

 

Warranty expenditures

 

 

(2,819

)

 

 

(2,596

)

 

 

(8,240

)

 

 

(7,503

)

Warranty reserves, end of period

 

$

36,743

 

 

$

32,091

 

 

$

36,743

 

 

$

32,091

 

 

Stock-Based Compensation (Tables)

The following table presents compensation expense recognized related to all stock-based awards (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2015

 

 

2014

 

 

2015

 

 

2014

 

Total stock-based compensation

 

$

2,994

 

 

$

3,547

 

 

$

8,536

 

 

$

6,250

 

 

The following table presents a summary of stock option awards for the nine months ended September 30, 2015:

 

 

 

 

 

 

 

Weighted

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

Average

 

 

Average

 

 

Aggregate

 

 

 

 

 

 

 

Exercise

 

 

Remaining

 

 

Intrinsic

 

 

 

 

 

 

 

Price

 

 

Contractual

 

 

Value

 

 

 

Options

 

 

Per Share

 

 

Life

 

 

(in thousands)

 

Options outstanding at December 31, 2014

 

 

3,467,086

 

 

$

13.05

 

 

 

6.0

 

 

$

7,642

 

Granted

 

 

 

 

 

 

 

 

 

 

 

 

Exercised

 

 

(171,716

)

 

 

11.54

 

 

 

 

 

 

 

 

 

Forfeited

 

 

(65,356

)

 

 

14.00

 

 

 

 

 

 

 

 

 

Options outstanding at September 30, 2015

 

 

3,230,014

 

 

 

13.12

 

 

 

5.2

 

 

 

 

Options exercisable at September 30, 2015

 

 

2,791,472

 

 

 

12.42

 

 

 

4.7

 

 

 

1,884

 

 

The following table presents a summary of restricted stock units (“RSUs”) for the nine months ended September 30, 2015:

 

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

 

 

 

 

 

Average

 

 

Aggregate

 

 

 

Restricted

 

 

Grant Date

 

 

Intrinsic

 

 

 

Stock

 

 

Fair Value

 

 

Value

 

 

 

Units

 

 

Per Share

 

 

(in thousands)

 

Nonvested RSUs at December 31, 2014

 

 

900,547

 

 

$

15.62

 

 

$

13,461

 

Granted

 

 

1,580,499

 

 

 

11.59

 

 

 

18,315

 

Vested

 

 

(453,685

)

 

 

13.85

 

 

 

 

 

Forfeited

 

 

(66,918

)

 

 

14.56

 

 

 

 

 

Nonvested RSUs at September 30, 2015

 

 

1,960,443

 

 

 

12.21

 

 

 

25,662

 

 

Related Party Transactions (Tables)
Schedule of Allocated Corporate General and Administrative Expenses

Weyerhaeuser-allocated corporate general and administrative expenses were as follows (in thousands):

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

 

2015

 

 

 

2014

 

 

 

2015

 

 

 

2014

 

Weyerhaeuser-allocated costs

 

$

 

 

$

 

 

$

 

 

$

10,735

 

 

Supplemental Disclosure to Consolidated Statements of Cash Flow (Tables)
Supplemental Disclosure to Consolidated Statements of Cash Flows

The following are supplemental disclosures to the consolidated statements of cash flows (in thousands):

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2015

 

 

2014

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

 

 

Cash paid during the period for:

 

 

 

 

 

 

 

 

Interest, net of amounts capitalized

 

$

 

 

$

1,372

 

Income taxes

 

$

44,394

 

 

$

14,962

 

Supplemental disclosures of noncash activities:

 

 

 

 

 

 

 

 

Increase in real estate inventory due to distribution of land

   from an unconsolidated joint venture

 

$

 

 

$

5,132

 

Distribution to Weyerhaeuser of excluded assets and

   liabilities

 

$

 

 

$

125,019

 

Amounts owed to Weyerhaeuser related to the tax sharing

   agreement

 

$

 

 

$

15,688

 

Noncash settlement of debt payable to Weyerhaeuser

 

$

 

 

$

70,082

 

Accrued liabilities related to the purchase of operating

   properties and equipment

 

$

1,877

 

 

$

 

Amortization of senior note discount

 

$

1,155

 

 

$

 

Effect of net consolidation and de-consolidation of

   variable interest entities:

 

 

 

 

 

 

 

 

(Decrease) increase in consolidated real estate

   inventory not owned

 

$

(3,556

)

 

$

4,497

 

Increase in accrued expenses and other liabilities

 

$

300

 

 

$

 

Decrease (increase) in noncontrolling interests

 

$

3,256

 

 

$

(4,497

)

 

Supplemental Guarantor Information (Tables)

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Balance Sheet (in thousands):

 

 

 

September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

37,015

 

 

$

59,978

 

 

$

 

 

$

96,993

 

Receivables

 

 

11,225

 

 

 

21,696

 

 

 

 

 

 

32,921

 

Intercompany receivables

 

 

872,290

 

 

 

 

 

 

(872,290

)

 

 

 

Real estate inventories

 

 

675,914

 

 

 

1,900,488

 

 

 

 

 

 

2,576,402

 

Investments in unconsolidated entities

 

 

 

 

 

17,340

 

 

 

 

 

 

17,340

 

Goodwill and other intangible assets, net

 

 

162,162

 

 

 

 

 

 

 

 

 

162,162

 

Investments in subsidiaries

 

 

1,045,130

 

 

 

 

 

 

(1,045,130

)

 

 

 

Deferred tax assets

 

 

23,630

 

 

 

117,849

 

 

 

 

 

 

141,479

 

Other assets

 

 

76,629

 

 

 

7,887

 

 

 

 

 

 

84,516

 

Total Assets

 

$

2,903,995

 

 

$

2,125,238

 

 

$

(1,917,420

)

 

$

3,111,813

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

14,821

 

 

$

52,926

 

 

$

 

 

$

67,747

 

Intercompany payables

 

 

 

 

 

872,290

 

 

 

(872,290

)

 

 

 

Accrued expenses and other liabilities

 

 

67,777

 

 

 

142,930

 

 

 

 

 

 

210,707

 

Unsecured revolving credit facility

 

 

349,392

 

 

 

 

 

 

 

 

 

349,392

 

Seller financed loans

 

 

7,172

 

 

 

400

 

 

 

 

 

 

7,572

 

Senior notes

 

 

888,657

 

 

 

 

 

 

 

 

 

888,657

 

Total Liabilities

 

 

1,327,819

 

 

 

1,068,546

 

 

 

(872,290

)

 

 

1,524,075

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

 

1,576,176

 

 

 

1,045,130

 

 

 

(1,045,130

)

 

 

1,576,176

 

Noncontrolling interests

 

 

 

 

 

11,562

 

 

 

 

 

 

11,562

 

Total Equity

 

 

1,576,176

 

 

 

1,056,692

 

 

 

(1,045,130

)

 

 

1,587,738

 

Total Liabilities and Equity

 

$

2,903,995

 

 

$

2,125,238

 

 

$

(1,917,420

)

 

$

3,111,813

 

 

 

(1)

 References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Balance Sheet (in thousands):

 

 

 

December 31, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

105,888

 

 

$

64,741

 

 

$

 

 

$

170,629

 

Receivables

 

 

5,050

 

 

 

15,068

 

 

 

 

 

 

20,118

 

Intercompany receivables

 

 

797,480

 

 

 

 

 

 

(797,480

)

 

 

 

Real estate inventories

 

 

613,665

 

 

 

1,666,518

 

 

 

 

 

 

2,280,183

 

Investments in unconsolidated entities

 

 

 

 

 

16,805

 

 

 

 

 

 

16,805

 

Goodwill and other intangible assets, net

 

 

156,603

 

 

 

5,960

 

 

 

 

 

 

162,563

 

Investments in subsidiaries

 

 

941,397

 

 

 

 

 

 

(941,397

)

 

 

 

Deferred tax assets

 

 

23,630

 

 

 

134,191

 

 

 

 

 

 

157,821

 

Other assets

 

 

55,199

 

 

 

50,206

 

 

 

 

 

 

105,405

 

Total Assets

 

$

2,698,912

 

 

$

1,953,489

 

 

$

(1,738,877

)

 

$

2,913,524

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

$

25,800

 

 

$

43,060

 

 

$

 

 

$

68,860

 

Intercompany payables

 

 

 

 

 

797,480

 

 

 

(797,480

)

 

 

 

Accrued expenses and other liabilities

 

 

57,353

 

 

 

152,656

 

 

 

 

 

 

210,009

 

Unsecured revolving credit facility

 

 

260,000

 

 

 

 

 

 

 

 

 

260,000

 

Seller financed loans

 

 

14,077

 

 

 

600

 

 

 

 

 

 

14,677

 

Senior notes

 

 

887,502

 

 

 

 

 

 

 

 

 

887,502

 

Total Liabilities

 

 

1,244,732

 

 

 

993,796

 

 

 

(797,480

)

 

 

1,441,048

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total stockholders’ equity

 

 

1,454,180

 

 

 

941,397

 

 

 

(941,397

)

 

 

1,454,180

 

Noncontrolling interests

 

 

 

 

 

18,296

 

 

 

 

 

 

18,296

 

Total Equity

 

 

1,454,180

 

 

 

959,693

 

 

 

(941,397

)

 

 

1,472,476

 

Total Liabilities and Equity

 

$

2,698,912

 

 

$

1,953,489

 

 

$

(1,738,877

)

 

$

2,913,524

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Three Months Ended September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

224,244

 

 

$

418,108

 

 

$

 

 

$

642,352

 

Land and lot sales

 

 

 

 

 

4,876

 

 

 

 

 

 

4,876

 

Other operations

 

 

 

 

 

913

 

 

 

 

 

 

913

 

Total revenues

 

 

224,244

 

 

 

423,897

 

 

 

 

 

 

648,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

182,754

 

 

 

324,789

 

 

 

 

 

 

507,543

 

Cost of land and lot sales

 

 

 

 

 

3,451

 

 

 

 

 

 

3,451

 

Other operations

 

 

 

 

 

570

 

 

 

 

 

 

570

 

Sales and marketing

 

 

7,286

 

 

 

22,752

 

 

 

 

 

 

30,038

 

General and administrative

 

 

12,942

 

 

 

13,841

 

 

 

 

 

 

26,783

 

Restructuring charges

 

 

(83

)

 

 

2,093

 

 

 

 

 

 

2,010

 

Total expenses

 

 

202,899

 

 

 

367,496

 

 

 

 

 

 

570,395

 

Income from operations

 

 

21,345

 

 

 

56,401

 

 

 

 

 

 

77,746

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(3

)

 

 

 

 

 

(3

)

Other income, net

 

 

(37

)

 

 

84

 

 

 

 

 

 

47

 

Income before taxes

 

 

21,308

 

 

 

56,482

 

 

 

 

 

 

77,790

 

Provision for income taxes

 

 

(9,070

)

 

 

(18,951

)

 

 

 

 

 

(28,021

)

Equity of net income of subsidiaries

 

 

37,924

 

 

 

 

 

 

(37,924

)

 

 

 

Net income

 

 

50,162

 

 

 

37,531

 

 

 

(37,924

)

 

 

49,769

 

Net loss attributable to noncontrolling interests

 

 

 

 

 

393

 

 

 

 

 

 

393

 

Net income available to common stockholders

 

$

50,162

 

 

$

37,924

 

 

$

(37,924

)

 

$

50,162

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Three Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

123,456

 

 

$

348,345

 

 

$

 

 

$

471,801

 

Land and lot sales

 

 

 

 

 

5,550

 

 

 

 

 

 

5,550

 

Other operations

 

 

(11

)

 

 

580

 

 

 

 

 

 

569

 

Total revenues

 

 

123,445

 

 

 

354,475

 

 

 

 

 

 

477,920

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

108,687

 

 

 

276,713

 

 

 

 

 

 

385,400

 

Cost of land and lot sales

 

 

 

 

 

2,317

 

 

 

 

 

 

2,317

 

Other operations

 

 

 

 

 

556

 

 

 

 

 

 

556

 

Sales and marketing

 

 

3,956

 

 

 

24,437

 

 

 

 

 

 

28,393

 

General and administrative

 

 

7,246

 

 

 

13,705

 

 

 

 

 

 

20,951

 

Restructuring charges

 

 

 

 

 

7,024

 

 

 

 

 

 

7,024

 

Total expenses

 

 

119,889

 

 

 

324,752

 

 

 

 

 

 

444,641

 

Income from operations

 

 

3,556

 

 

 

29,723

 

 

 

 

 

 

33,279

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(82

)

 

 

 

 

 

(82

)

Transaction expenses

 

 

(6,381

)

 

 

(10,329

)

 

 

 

 

 

 

(16,710

)

Other income, net

 

 

9

 

 

 

490

 

 

 

 

 

 

499

 

(Loss) income before taxes

 

 

(2,816

)

 

 

19,802

 

 

 

 

 

 

16,986

 

Benefit (provision) for income taxes

 

 

2,032

 

 

 

(8,053

)

 

 

 

 

 

(6,021

)

Equity of net income of subsidiaries

 

 

11,749

 

 

 

 

 

 

(11,749

)

 

 

 

Net income available to common stockholders

 

$

10,965

 

 

$

11,749

 

 

$

(11,749

)

 

$

10,965

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Nine Months Ended September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

461,654

 

 

$

982,201

 

 

$

 

 

$

1,443,855

 

Land and lot sales

 

 

 

 

 

74,366

 

 

 

 

 

 

74,366

 

Other operations

 

 

 

 

 

2,695

 

 

 

 

 

 

2,695

 

Total revenues

 

 

461,654

 

 

 

1,059,262

 

 

 

 

 

 

1,520,916

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

376,100

 

 

 

773,091

 

 

 

 

 

 

1,149,191

 

Cost of land and lot sales

 

 

 

 

 

17,324

 

 

 

 

 

 

17,324

 

Other operations

 

 

 

 

 

1,724

 

 

 

 

 

 

1,724

 

Sales and marketing

 

 

17,714

 

 

 

61,244

 

 

 

 

 

 

78,958

 

General and administrative

 

 

38,874

 

 

 

44,387

 

 

 

 

 

 

83,261

 

Restructuring charges

 

 

(169

)

 

 

2,899

 

 

 

 

 

 

2,730

 

Total expenses

 

 

432,519

 

 

 

900,669

 

 

 

 

 

 

1,333,188

 

Income from operations

 

 

29,135

 

 

 

158,593

 

 

 

 

 

 

187,728

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(84

)

 

 

 

 

 

(84

)

Other (loss) income, net

 

 

(149

)

 

 

421

 

 

 

 

 

 

272

 

Income before taxes

 

 

28,986

 

 

 

158,930

 

 

 

 

 

 

187,916

 

Provision for income taxes

 

 

(12,285

)

 

 

(53,803

)

 

 

 

 

 

(66,088

)

Equity of net income of subsidiaries

 

 

103,688

 

 

 

 

 

 

(103,688

)

 

 

 

Net income

 

 

120,389

 

 

 

105,127

 

 

 

(103,688

)

 

 

121,828

 

Net income attributable to noncontrolling interests

 

 

 

 

 

(1,439

)

 

 

 

 

 

(1,439

)

Net income available to common stockholders

 

$

120,389

 

 

$

103,688

 

 

$

(103,688

)

 

$

120,389

 

 

 

(1)

  References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Operations (in thousands):

 

 

 

Nine Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Home sales

 

$

123,456

 

 

$

899,856

 

 

$

 

 

$

1,023,312

 

Land and lot sales

 

 

 

 

 

36,449

 

 

 

 

 

 

36,449

 

Other operations

 

 

(11

)

 

 

8,865

 

 

 

 

 

 

8,854

 

Total revenues

 

 

123,445

 

 

 

945,170

 

 

 

 

 

 

1,068,615

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales

 

 

108,687

 

 

 

710,690

 

 

 

 

 

 

819,377

 

Cost of land and lot sales

 

 

 

 

 

30,245

 

 

 

 

 

 

30,245

 

Other operations

 

 

 

 

 

2,755

 

 

 

 

 

 

2,755

 

Sales and marketing

 

 

3,956

 

 

 

69,140

 

 

 

 

 

 

73,096

 

General and administrative

 

 

7,246

 

 

 

49,894

 

 

 

 

 

 

57,140

 

Restructuring charges

 

 

 

 

 

9,202

 

 

 

 

 

 

9,202

 

Total expenses

 

 

119,889

 

 

 

871,926

 

 

 

 

 

 

991,815

 

Income from operations

 

 

3,556

 

 

 

73,244

 

 

 

 

 

 

76,800

 

Equity in loss of unconsolidated entities

 

 

 

 

 

(219

)

 

 

 

 

 

(219

)

Transaction expenses

 

 

(6,381

)

 

 

(10,835

)

 

 

 

 

 

 

(17,216

)

Other income (loss), net

 

 

9

 

 

 

(251

)

 

 

 

 

 

(242

)

(Loss) income before taxes

 

 

(2,816

)

 

 

61,939

 

 

 

 

 

 

59,123

 

Benefit (provision) for income taxes

 

 

2,032

 

 

 

(18,384

)

 

 

 

 

 

(16,352

)

Equity of net income of subsidiaries

 

 

43,555

 

 

 

 

 

 

(43,555

)

 

 

 

Net income available to common stockholders

 

$

42,771

 

 

$

43,555

 

 

$

(43,555

)

 

$

42,771

 

 

 

(1)

 References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Cash Flows (in thousands):

 

 

 

Nine Months Ended September 30, 2015

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Group, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

$

(69,362

)

 

$

(70,649

)

 

$

 

 

$

(140,011

)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(382

)

 

 

(677

)

 

 

 

 

 

(1,059

)

Investments in unconsolidated entities

 

 

 

 

 

(1,458

)

 

 

 

 

 

(1,458

)

Distributions from unconsolidated entities

 

 

 

 

 

319

 

 

 

 

 

 

319

 

Intercompany

 

 

(78,354

)

 

 

 

 

 

78,354

 

 

 

 

Net cash used in investing activities

 

 

(78,736

)

 

 

(1,816

)

 

 

78,354

 

 

 

(2,198

)

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings from debt

 

 

140,000

 

 

 

 

 

 

 

 

 

140,000

 

Repayment of debt

 

 

(57,513

)

 

 

(200

)

 

 

 

 

 

(57,713

)

Debt issuance costs

 

 

(2,688

)

 

 

 

 

 

 

 

 

(2,688

)

Net proceeds (repayments) of debt held by variable interest

   entities

 

 

 

 

 

(5,927

)

 

 

 

 

 

(5,927

)

Contributions from noncontrolling interests

 

 

 

 

 

4,281

 

 

 

 

 

 

4,281

 

Distributions to noncontrolling interests

 

 

 

 

 

(9,198

)

 

 

 

 

 

(9,198

)

Proceeds from issuance of common stock under share-based

   awards

 

 

1,616

 

 

 

 

 

 

 

 

 

1,616

 

Excess tax benefits of share-based awards

 

 

 

 

 

392

 

 

 

 

 

 

392

 

Minimum tax withholding paid on behalf of employees for

   restricted stock units

 

 

(2,190

)

 

 

 

 

 

 

 

 

(2,190

)

Intercompany

 

 

 

 

 

78,354

 

 

 

(78,354

)

 

 

 

Net cash provided by financing activities

 

 

79,225

 

 

 

67,702

 

 

 

(78,354

)

 

 

68,573

 

Net decrease in cash and cash equivalents

 

 

(68,873

)

 

 

(4,763

)

 

 

 

 

 

(73,636

)

Cash and cash equivalents - beginning of period

 

 

105,888

 

 

 

64,741

 

 

 

 

 

 

170,629

 

Cash and cash equivalents - end of period

 

$

37,015

 

 

$

59,978

 

 

$

 

 

$

96,993

 

 

 

(1)

 References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

 

20.

Supplemental Guarantor Information (continued)

Condensed Consolidating Statement of Cash Flows (in thousands):

 

 

 

Nine Months Ended September 30, 2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

Guarantor

 

 

Consolidating

 

 

TRI Pointe

 

 

 

Issuer (1)

 

 

Subsidiaries

 

 

Adjustments

 

 

Homes, Inc.

 

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

 

(unaudited)

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in operating activities

 

$

(26,882

)

 

$

(113,547

)

 

$

 

 

$

(140,429

)

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(659

)

 

 

(5,409

)

 

 

 

 

 

(6,068

)

Cash acquired in the Merger

 

 

53,800

 

 

 

 

 

 

 

 

 

53,800

 

Proceeds from sale of property and equipment

 

 

 

 

 

22

 

 

 

 

 

 

22

 

Investments in unconsolidated entities

 

 

 

 

 

(573

)

 

 

 

 

 

(573

)

Intercompany

 

 

(850,977

)

 

 

 

 

 

850,977

 

 

 

 

Net cash used in investing activities

 

 

(797,836

)

 

 

(5,960

)

 

 

850,977

 

 

 

47,181

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings from debt

 

 

50,000

 

 

 

 

 

 

 

 

 

50,000

 

Debt issuance costs

 

 

(23,003

)

 

 

 

 

 

 

 

 

(23,003

)

Proceeds from issuance of senior notes

 

 

886,698

 

 

 

 

 

 

 

 

 

886,698

 

Bridge commitment fee

 

 

 

 

 

(10,322

)

 

 

 

 

 

(10,322

)

Changes in debt payable to Weyerhaeuser

 

 

 

 

 

(623,589

)

 

 

 

 

 

(623,589

)

Change in book overdrafts

 

 

 

 

 

(22,492

)

 

 

 

 

 

(22,492

)

Distributions to Weyerhaeuser

 

 

 

 

 

(8,860

)

 

 

 

 

 

(8,860

)

Net proceeds (repayments) of debt held by variable interest

   entities

 

 

 

 

 

5,120

 

 

 

 

 

 

5,120

 

Distributions to noncontrolling interests

 

 

 

 

 

(18,703

)

 

 

 

 

 

(18,703

)

Excess tax benefits of share-based awards

 

 

 

 

 

1,572

 

 

 

 

 

 

1,572

 

Intercompany

 

 

 

 

 

 

850,977

 

 

 

(850,977

)

 

 

 

Net cash provided by financing activities

 

 

913,695

 

 

 

173,703

 

 

 

(850,977

)

 

 

236,421

 

Net increase in cash and cash equivalents

 

 

88,977

 

 

 

54,196

 

 

 

 

 

 

143,173

 

Cash and cash equivalents - beginning of period

 

 

 

 

 

4,510

 

 

 

 

 

 

4,510

 

Cash and cash equivalents - end of period

 

$

88,977

 

 

$

58,706

 

 

$

 

 

$

147,683

 

 

 

(1)

References to “Issuer” in Note 20, Supplemental Guarantor Information have the following meanings:

 

a.

for periods prior to July 7, 2015: TRI Pointe Homes only

 

b.

for periods from and after July 7, 2015:  TRI Pointe Homes and TRI Pointe Group as co-issuers

Organization, Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2015
Senior Notes [Member]
Sep. 30, 2015
Adjustments for New Accounting Principle Early Adoption [Member]
Other Assets [Member]
Dec. 31, 2014
Adjustments for New Accounting Principle Early Adoption [Member]
Other Assets [Member]
Sep. 30, 2015
Adjustments for New Accounting Principle Early Adoption [Member]
Unsecured revolving credit facility [Member]
Sep. 30, 2015
Adjustments for New Accounting Principle Early Adoption [Member]
Senior Notes [Member]
Dec. 31, 2014
Adjustments for New Accounting Principle Early Adoption [Member]
Senior Notes [Member]
Dec. 31, 2013
Scenario Previously Reported [Member]
WRECO [Member]
Sep. 30, 2015
WRECO Transaction [Member]
Jul. 7, 2014
WRECO Transaction [Member]
Organization And Summary Of Significant Accounting Policies [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Common stock, shares issued
161,813,750 
161,355,490 
 
 
 
 
 
 
100,000,000 
 
129,700,000 
Common stock, shares outstanding
161,813,750 
161,355,490 
 
 
 
 
 
 
100,000,000 
31,632,533 
129,700,000 
Conversion of shares, description
In the Merger, each issued and outstanding WRECO common share was converted into 1.297 shares of TRI Pointe common stock. 
 
 
 
 
 
 
 
 
 
 
Deferred loan cost
$ (23,617)
$ (23,686)
$ (21,200)
$ 23,600 
$ 23,700 
$ 2,400 
$ 21,200 
$ 23,700 
 
 
 
Merger with Weyerhaeuser Real Estate Company - Additional Information (Detail) (USD $)
0 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 0 Months Ended 9 Months Ended
Jun. 13, 2014
Deposit
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2015
Trade names [Member]
Sep. 30, 2015
4.375% Senior notes due 2019 [Member]
Dec. 31, 2014
4.375% Senior notes due 2019 [Member]
Sep. 30, 2015
5.875% Senior notes due 2024 [Member]
Dec. 31, 2014
5.875% Senior notes due 2024 [Member]
Sep. 30, 2015
Unpaid Interest [Member]
Jul. 7, 2014
WRECO Transaction [Member]
Sep. 30, 2015
WRECO Transaction [Member]
Jun. 13, 2014
WRECO Transaction [Member]
Jun. 13, 2014
WRECO Transaction [Member]
Transaction Agreement [Member]
Jun. 13, 2014
WRECO Transaction [Member]
Unpaid Interest [Member]
Sep. 30, 2015
TRI Pointe [Member]
Sep. 30, 2015
TRI Pointe [Member]
WRECO Transaction [Member]
Business Acquisition [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock, shares issued
 
161,813,750 
161,355,490 
 
 
 
 
 
 
129,700,000 
 
 
 
 
129,700,000 
 
Percentage of common stock outstanding
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
79.60% 
Percentage of common stock owned after the Merger by TRI Pointe shareholders of record prior to the Merger
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
19.40% 
Outstanding equity awards of the employee in percentage
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
Amount of adjustment based on transaction agreement
 
 
 
 
 
 
 
 
 
$ 31,500,000 
 
 
 
 
 
 
Aggregate principal amount
 
 
 
 
450,000,000 
 
450,000,000 
 
 
 
 
 
 
 
 
 
Interest rate on senior note
 
 
 
 
4.375% 
4.375% 
5.875% 
5.875% 
 
 
 
 
 
 
 
 
Debt instrument, maturity year
 
 
 
 
2019 
 
2024 
 
 
 
 
 
 
 
 
 
Proceeds from issuance of senior notes
861,300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of escrow accounts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash payment to former direct parent
 
 
 
 
 
 
 
 
 
 
 
743,700,000 
739,000,000 
4,700,000 
 
 
Cash retained by the Company
 
 
 
 
 
 
 
 
 
 
 
 
 
 
117,600,000 
 
Debt issuance date
 
 
 
 
 
 
 
 
Nov. 03, 2013 
 
 
 
 
 
 
 
Acquisition related to trade names
 
 
 
$ 17,300,000 
 
 
 
 
 
 
$ 17,300,000 
 
 
 
 
 
Merger with Weyerhaeuser Real Estate Company - Summary of Calculation of Fair Value of Total Consideration Transferred and Provisional Amounts Recognized (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2015
WRECO Transaction [Member]
Jul. 7, 2014
WRECO Transaction [Member]
Calculation of consideration transferred
 
 
 
 
TRI Pointe shares outstanding
161,813,750 
161,355,490 
31,632,533 
129,700,000 
TRI Pointe closing stock price on July 7, 2014
 
 
$ 15.85 
 
Consideration attributable to common stock
 
 
$ 501,376 
 
Consideration attributable to TRI Pointe share-based equity awards
 
 
1,072 
 
Total consideration transferred
 
 
502,448 
 
Assets acquired and liabilities assumed
 
 
 
 
Cash and cash equivalents
 
 
53,800 
 
Accounts receivable
 
 
654 
 
Real estate inventories
 
 
539,677 
 
Intangible asset
 
 
17,300 
 
Goodwill
139,303 
139,304 
139,304 
 
Other assets
 
 
28,060 
 
Total assets acquired
 
 
778,795 
 
Accounts payable
 
 
26,105 
 
Accrued expenses and other liabilities
 
 
23,114 
 
Notes payable and other borrowings
 
 
227,128 
 
Total liabilities assumed
 
 
276,347 
 
Total net assets acquired
 
 
$ 502,448 
 
Merger with Weyerhaeuser Real Estate Company - Summary of Pro Forma Operating Results (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2014
Sep. 30, 2014
Business Combinations [Abstract]
 
 
Total revenues
$ 479,879 
$ 1,230,722 
Net income
$ 21,934 
$ 66,902 
Earnings per share – basic
$ 0.14 
$ 0.41 
Earnings per share – diluted
$ 0.14 
$ 0.41 
Restructuring - Schedule of Restructuring Costs (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Restructuring And Related Activities [Abstract]
 
 
 
 
Employee-related costs
$ 1,433 
$ 6,817 
$ 1,568 
$ 8,124 
Lease termination costs
577 
207 
1,162 
1,078 
Total
$ 2,010 
$ 7,024 
$ 2,730 
$ 9,202 
Segment Information - Additional Information (Detail)
9 Months Ended
Sep. 30, 2015
Segment
Segment Reporting [Abstract]
 
Number of operating divisions
Number of reportable segments
Segment Information - Summary of Financial Information Relating to Reportable Segments (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
$ 648,141 
$ 477,920 
$ 1,520,916 
$ 1,068,615 
 
Income before taxes
77,790 
16,986 
187,916 
59,123 
 
Real estate inventories
2,576,402 
 
2,576,402 
 
2,280,183 
Total assets
3,111,813 
 
3,111,813 
 
2,913,524 
Operating segments [Member] |
Maracay Homes [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
50,505 
37,301 
116,556 
107,576 
 
Income before taxes
3,750 
2,212 
5,858 
8,222 
 
Real estate inventories
205,432 
 
205,432 
 
153,577 
Total assets
221,190 
 
221,190 
 
170,932 
Operating segments [Member] |
Pardee Homes [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
172,957 
134,409 
424,680 
352,118 
 
Income before taxes
39,749 
21,787 
121,041 
47,580 
 
Real estate inventories
1,013,792 
 
1,013,792 
 
924,362 
Total assets
1,080,599 
 
1,080,599 
 
1,000,489 
Operating segments [Member] |
Quadrant Homes [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
48,173 
32,919 
132,698 
96,958 
 
Income before taxes
3,982 
649 
6,329 
6,889 
 
Real estate inventories
193,374 
 
193,374 
 
153,493 
Total assets
206,986 
 
206,986 
 
167,796 
Operating segments [Member] |
Trendmaker Homes [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
81,044 
69,711 
203,235 
198,867 
 
Income before taxes
7,496 
7,327 
17,896 
21,529 
 
Real estate inventories
191,803 
 
191,803 
 
176,696 
Total assets
219,869 
 
219,869 
 
195,829 
Operating segments [Member] |
TRI Pointe Homes [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
224,544 
123,445 
462,136 
123,445 
 
Income before taxes
29,556 
8,685 
55,251 
8,685 
 
Real estate inventories
678,564 
 
678,564 
 
613,666 
Total assets
847,013 
 
847,013 
 
781,301 
Operating segments [Member] |
Winchester Homes [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Total revenues
70,918 
80,135 
181,611 
189,651 
 
Income before taxes
1,726 
6,941 
8,064 
17,978 
 
Real estate inventories
293,437 
 
293,437 
 
258,389 
Total assets
312,932 
 
312,932 
 
281,547 
Corporate [Member]
 
 
 
 
 
Segment Reporting Information [Line Items]
 
 
 
 
 
Income before taxes
(8,469)
(30,615)
(26,523)
(51,760)
 
Total assets
$ 223,224 
 
$ 223,224 
 
$ 315,630 
Earnings Per Share - Computation of Basic and Diluted Earnings Per Share (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Numerator:
 
 
 
 
Net income available to common stockholders
$ 50,162 
$ 10,965 
$ 120,389 
$ 42,771 
Denominator:
 
 
 
 
Basic weighted-average shares outstanding
161,772,893 
158,931,450 
161,651,177 
139,550,891 
Effect of dilutive shares:
 
 
 
 
Stock options and unvested restricted stock units
593,851 
227,256 
648,105 
662,764 
Diluted weighted-average shares outstanding
162,366,744 
159,158,706 
162,299,282 
140,213,655 
Earnings per share
 
 
 
 
Basic
$ 0.31 
$ 0.07 
$ 0.74 
$ 0.31 
Diluted
$ 0.31 
$ 0.07 
$ 0.74 
$ 0.31 
Antidilutive unvested restricted stock units and stock options not included in diluted earnings per share
2,260,532 
3,634,614 
2,462,268 
 
Receivables - Components of Receivables (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Receivables [Abstract]
 
 
Escrow proceeds and other accounts receivable, net
$ 22,128 
$ 9,771 
Warranty insurance receivable (Note 15)
10,493 
10,047 
Notes and contracts receivable
300 
300 
Total receivables
$ 32,921 
$ 20,118 
Real Estate Inventories - Summary of Real Estate Inventories (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Real estate inventories owned:
 
 
Homes completed or under construction
$ 749,852 
$ 461,712 
Land under development
1,380,298 
1,391,303 
Land held for future development
257,610 
245,673 
Model homes
127,815 
103,270 
Total real estate inventories owned
2,515,575 
2,201,958 
Real estate inventories not owned:
 
 
Land purchase and land option deposits
42,329 
44,155 
Consolidated inventory held by VIEs
18,498 
34,070 
Total real estate inventories not owned
60,827 
78,225 
Total real estate inventories
$ 2,576,402 
$ 2,280,183 
Real Estate Inventories - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Jun. 30, 2015
acre
Real Estate [Abstract]
 
 
Area of land sold
 
15.72 
Cash proceeds from sale of land
$ 53.0 
 
Real Estate Inventories - Summary of Interest Incurred, Capitalized and Expensed (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Real Estate Inventory, Capitalized Interest Costs [Roll Forward]
 
 
 
 
Interest incurred
$ 15,454 
$ 15,129 
$ 45,779 
$ 25,718 
Interest capitalized
(15,454)
(14,839)
(45,779)
(22,987)
Interest expensed
 
290 
 
2,731 
Capitalized interest in beginning inventory
140,106 
113,765 
124,461 
138,233 
Interest capitalized as a cost of inventory
15,454 
14,839 
45,779 
22,987 
Interest previously capitalized as a cost of inventory, included in cost of sales
(13,339)
(7,835)
(28,019)
(40,451)
Capitalized interest in ending inventory
$ 142,221 
$ 120,769 
$ 142,221 
$ 120,769 
Real Estate Inventories - Schedule of Real Estate Inventory Impairments and Land Option Abandonments (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Real Estate [Abstract]
 
 
 
 
Real estate inventory impairments
$ 29 
$ 248 
$ 1,073 
$ 300 
Land and lot option abandonments and pre-acquisition costs
336 
304 
830 
824 
Real estate inventory impairments and land option abandonments, Total
$ 365 
$ 552 
$ 1,903 
$ 1,124 
Investments in Unconsolidated Entities - Additional Information (Detail)
9 Months Ended
Sep. 30, 2015
Investment
Investment Holdings [Line Items]
 
Number of equity investments
Minimum [Member]
 
Investment Holdings [Line Items]
 
Ownership percentage
7.00% 
Maximum [Member]
 
Investment Holdings [Line Items]
 
Ownership percentage
55.00% 
Investments in Unconsolidated Entities - Schedule of Cumulative Investment in Entities on Equity Method, Including Share of Earnings and Losses (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Schedule of Investments [Line Items]
 
 
Investments in unconsolidated entities
$ 17,340 
$ 16,805 
Limited Liability Company Interests [Member]
 
 
Schedule of Investments [Line Items]
 
 
Investments in unconsolidated entities
14,079 
13,710 
General Partnership Interests [Member]
 
 
Schedule of Investments [Line Items]
 
 
Investments in unconsolidated entities
$ 3,261 
$ 3,095 
Investments in Unconsolidated Entities - Aggregated Assets, Liabilities and Operating Results of Entities as Equity-Method Investments (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Assets
 
 
 
 
 
Total assets
$ 124,792 
 
$ 124,792 
 
$ 122,824 
Liabilities and equity
 
 
 
 
 
Accounts payable and other liabilities
14,293 
 
14,293 
 
10,914 
Company’s equity
17,340 
 
17,340 
 
16,805 
Outside interests’ equity
93,159 
 
93,159 
 
95,105 
Total liabilities and equity
124,792 
 
124,792 
 
122,824 
Net sales
1,217 
184 
2,670 
591 
 
Other operating expense
(1,479)
(1,215)
(4,020)
(3,372)
 
Other income
(263)
(256)
16 
 
Net loss
(525)
(1,029)
(1,606)
(2,765)
 
Company’s equity in loss of unconsolidated entities
(3)
(82)
(84)
(219)
 
Cash [Member]
 
 
 
 
 
Assets
 
 
 
 
 
Total assets
19,282 
 
19,282 
 
17,154 
Receivables [Member]
 
 
 
 
 
Assets
 
 
 
 
 
Total assets
12,916 
 
12,916 
 
9,550 
Real Estate Inventories [Member]
 
 
 
 
 
Assets
 
 
 
 
 
Total assets
91,712 
 
91,712 
 
95,500 
Other Assets [Member]
 
 
 
 
 
Assets
 
 
 
 
 
Total assets
$ 882 
 
$ 882 
 
$ 620 
Variable Interest Entities - Summary of Interests in Land Option Agreements (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Variable Interest Entity [Line Items]
 
 
Deposits
$ 47,025 
$ 52,226 
Remaining Purchase Price
345,359 
457,888 
Consolidated inventory held by VIEs
18,498 
34,070 
Consolidated VIEs [Member]
 
 
Variable Interest Entity [Line Items]
 
 
Deposits
4,696 
8,071 
Remaining Purchase Price
14,140 
43,432 
Consolidated inventory held by VIEs
18,498 
34,070 
Unconsolidated VIEs [Member]
 
 
Variable Interest Entity [Line Items]
 
 
Deposits
8,150 
13,309 
Remaining Purchase Price
22,781 
129,637 
Other land option agreements [Member]
 
 
Variable Interest Entity [Line Items]
 
 
Deposits
34,179 
30,846 
Remaining Purchase Price
$ 308,438 
$ 284,819 
Variable Interest Entities - Additional Information (Detail) (Other land option agreements [Member], USD $)
In Millions, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Other land option agreements [Member]
 
 
Variable Interest Entity [Line Items]
 
 
Capitalized pre-acquisition costs
$ 4.6 
$ 5.3 
Goodwill and Other Intangible Assets - Additional Information (Detail) (USD $)
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Schedule Of Intangible Assets And Goodwill [Line Items]
 
 
 
 
 
Goodwill
$ 139,303,000 
 
$ 139,303,000 
 
$ 139,304,000 
Number of intangible assets
 
 
 
Indefinite-Lived Trade Names [Member]
 
 
 
 
 
Schedule Of Intangible Assets And Goodwill [Line Items]
 
 
 
 
 
Indefinite life intangible asset
17,300,000 
 
17,300,000 
 
 
Finite-Lived Trade Names [Member]
 
 
 
 
 
Schedule Of Intangible Assets And Goodwill [Line Items]
 
 
 
 
 
Remaining useful life of amortizing asset
10 years 4 months 24 days 
 
 
 
11 years 2 months 12 days 
Amortization expense
134,000 
134,000 
400,000 
400,000 
 
Maracay Homes [Member]
 
 
 
 
 
Schedule Of Intangible Assets And Goodwill [Line Items]
 
 
 
 
 
Intangible assets useful life
20 years 
 
 
 
 
WRECO Transaction [Member]
 
 
 
 
 
Schedule Of Intangible Assets And Goodwill [Line Items]
 
 
 
 
 
Goodwill
$ 139,304,000 
 
$ 139,304,000 
 
 
Goodwill and Other Intangible Assets - Schedule of Goodwill and Other Intangible Assets (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Goodwill And Intangible Assets Disclosure [Abstract]
 
 
Goodwill
$ 139,303 
$ 139,304 
Trade names, Gross Carrying Amount
27,979 
27,979 
Gross Carrying Amount
167,282 
167,283 
Accumulated Amortization
(5,120)
(4,720)
Net Carrying Amount
162,162 
162,563 
Trade names, Net Carrying Amount
$ 22,859 
$ 23,259 
Goodwill and Other Intangible Assets - Schedule of Expected Amortization of Intangible Asset (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Goodwill And Intangible Assets Disclosure [Abstract]
 
Remainder of 2015
$ 134 
2016
534 
2017
534 
2018
534 
2019
534 
Thereafter
3,289 
Total
$ 5,559 
Other Assets - Schedule of Other Assets (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract]
 
 
Prepaid expenses
$ 20,989 
$ 29,111 
Refundable fees and other deposits
16,576 
15,581 
Development rights, held for future use or sale
6,447 
7,409 
Deferred loan costs
23,617 
23,686 
Operating properties and equipment, net
8,869 
11,719 
Income tax receivable
1,808 
10,713 
Other
6,210 
7,186 
Other assets, total
$ 84,516 
$ 105,405 
Accrued Expenses and Other Liabilities - Schedule of Accrued Expenses and Other Liabilities (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Jun. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Jun. 30, 2014
Dec. 31, 2013
Payables And Accruals [Abstract]
 
 
 
 
 
 
Accrued payroll and related costs
$ 21,544 
 
$ 24,717 
 
 
 
Warranty reserves (Note 15)
36,743 
35,375 
33,270 
32,091 
24,324 
24,449 
Estimated cost for completion of real estate inventories
62,047 
 
54,437 
 
 
 
Customer deposits
19,734 
 
14,229 
 
 
 
Debt (nonrecourse) held by VIEs
3,286 
 
9,512 
 
 
 
Income tax liability to Weyerhaeuser (Note 18)
8,600 
 
15,659 
 
 
 
Liability for uncertain tax positions (Note 17)
16,563 
 
13,797 
 
 
 
Accrued interest
13,976 
 
3,059 
 
 
 
Accrued insurance expense
1,975 
 
9,180 
 
 
 
Other
26,239 
 
32,149 
 
 
 
Total
$ 210,707 
 
$ 210,009 
 
 
 
Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans - Schedule of Senior Notes (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Debt Instrument [Line Items]
 
 
Senior notes, net of discount
$ 888,657 
$ 887,502 
4.375% Senior notes due 2019 [Member]
 
 
Debt Instrument [Line Items]
 
 
Senior notes, net of discount
446,186 
445,501 
5.875% Senior notes due 2024 [Member]
 
 
Debt Instrument [Line Items]
 
 
Senior notes, net of discount
$ 442,471 
$ 442,001 
Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans - Schedule of Senior Notes (Parenthetical) (Detail)
9 Months Ended 12 Months Ended
Sep. 30, 2015
Dec. 31, 2014
4.375% Senior notes due 2019 [Member]
 
 
Debt Instrument [Line Items]
 
 
Interest rate on senior note
4.375% 
4.375% 
Maturity date of senior note
Jun. 15, 2019 
Jun. 15, 2019 
5.875% Senior notes due 2024 [Member]
 
 
Debt Instrument [Line Items]
 
 
Interest rate on senior note
5.875% 
5.875% 
Maturity date of senior note
Jun. 15, 2024 
Jun. 15, 2024 
Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans - Additional Information (Detail) (USD $)
0 Months Ended 3 Months Ended 9 Months Ended 3 Months Ended 9 Months Ended 9 Months Ended 9 Months Ended 12 Months Ended 9 Months Ended 12 Months Ended 9 Months Ended 9 Months Ended
Jun. 13, 2014
Deposit
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Sep. 30, 2015
Notes payable [Member]
Sep. 30, 2014
Notes payable [Member]
Sep. 30, 2015
Notes payable [Member]
Sep. 30, 2014
Notes payable [Member]
Sep. 30, 2015
Senior Notes [Member]
Dec. 31, 2014
Senior Notes [Member]
Sep. 30, 2015
Seller financed loan [Member]
Dec. 31, 2014
Seller financed loan [Member]
Sep. 30, 2015
4.375% Senior notes due 2019 [Member]
Dec. 31, 2014
4.375% Senior notes due 2019 [Member]
Sep. 30, 2015
5.875% Senior notes due 2024 [Member]
Dec. 31, 2014
5.875% Senior notes due 2024 [Member]
May 31, 2015
425 million revolving credit facility [Member]
Sep. 30, 2015
550 million revolving credit facility [Member]
May 31, 2015
550 million revolving credit facility [Member]
Dec. 31, 2014
550 million revolving credit facility [Member]
Sep. 30, 2015
550 million revolving credit facility [Member]
Minimum [Member]
Sep. 30, 2015
550 million revolving credit facility [Member]
Maximum [Member]
Sep. 30, 2015
550 million revolving credit facility [Member]
Letters of credit [Member]
Debt Instrument [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes issue price as a percentage of principal amount
 
 
 
 
 
 
 
 
 
 
 
 
 
 
98.89% 
 
98.15% 
 
 
 
 
 
 
 
 
Proceeds from issuance of senior notes
$ 861,300,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of escrow accounts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Maturity date of senior note
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Jun. 15, 2019 
Jun. 15, 2019 
Jun. 15, 2024 
Jun. 15, 2024 
 
 
 
 
 
 
 
Principal payment on Senior Notes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Capitalization of deferred finance costs
 
23,617,000 
 
23,617,000 
 
23,686,000 
 
 
 
 
21,200,000 
 
 
 
 
 
 
 
 
2,400,000 
 
 
 
 
 
Accrued interest
 
13,976,000 
 
13,976,000 
 
3,059,000 
 
 
 
 
13,500,000 
1,900,000 
122,000 
517,000 
 
 
 
 
 
376,000 
 
620,000 
 
 
 
Unsecured revolving credit facility
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
425,000,000 
550,000,000 
550,000,000 
 
 
 
75,000,000 
Line of credit facility, maturity date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
May 18, 2019 
 
 
 
 
 
Debt instrument variable interest rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.45% 
2.20% 
 
Notes payable and other borrowings
 
349,392,000 
 
349,392,000 
 
260,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
349,392,000 
 
260,000,000 
 
 
 
Interest rate on revolving credit facility
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2.16% 
 
 
 
 
 
Available secured revolving credit facility
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
192,400,000 
 
 
 
 
 
Outstanding letters of credit
 
8,200,000 
 
8,200,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding seller financed loans
 
7,572,000 
 
7,572,000 
 
14,677,000 
 
 
 
 
 
 
7,600,000 
 
 
 
 
 
 
 
 
 
 
 
 
Interest rate on seller financed loan
 
 
 
 
 
 
 
 
 
 
 
 
6.95% 
 
4.375% 
4.375% 
5.875% 
5.875% 
 
 
 
 
 
 
 
Remaining unpaid balance due date
 
 
 
 
 
 
 
 
 
 
 
 
2016-05 
 
 
 
 
 
 
 
 
 
 
 
 
Interest incurred
 
15,454,000 
15,129,000 
45,779,000 
25,718,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest capitalized
 
15,454,000 
14,839,000 
45,779,000 
22,987,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortization of deferred financing costs
 
 
 
 
 
 
$ 1,500,000 
$ 1,000,000 
$ 3,900,000 
$ 1,100,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans - Components of Unsecured Revolving Credit Facility (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Debt Instrument [Line Items]
 
 
Notes payable and other borrowings
$ 349,392 
$ 260,000 
550 million revolving credit facility [Member]
 
 
Debt Instrument [Line Items]
 
 
Notes payable and other borrowings
$ 349,392 
$ 260,000 
Senior Notes, Unsecured Revolving Credit Facility and Seller Financed Loans - Components of Seller Financed Loans (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Debt Disclosure [Abstract]
 
 
Seller financed loans
$ 7,572 
$ 14,677 
Fair Value Disclosures - Summary of Nonfinancial Assets Measured at Fair Value on a Nonrecurring Basis (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Level 3 [Member]
Fair Value Measurements Nonrecurring
Dec. 31, 2014
Level 3 [Member]
Fair Value Measurements Nonrecurring
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
 
 
 
 
 
 
Real estate inventories, impairment charge
$ 29 
$ 248 
$ 1,073 
$ 300 
$ 1,073 
$ 931 
Real estate inventories, fair value net of impairment
 
 
 
 
$ 20,409 
$ 20,329 
Commitments and Contingencies - Additional Information (Detail) (USD $)
Sep. 30, 2015
Dec. 31, 2014
Commitment And Contingencies [Line Items]
 
 
Outstanding warranty insurance receivables
$ 10,493,000 
$ 10,047,000 
Surety bonds [Member]
 
 
Commitment And Contingencies [Line Items]
 
 
Outstanding surety bonds
422,300,000 
355,200,000 
Legal Reserve
 
 
Commitment And Contingencies [Line Items]
 
 
Legal reserves
$ 468,000 
$ 273,000 
Commitments and Contingencies - Schedule of Warranty Reserves (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Movement in Standard Product Warranty Accrual [Roll Forward]
 
 
 
 
Warranty reserves, beginning of period
$ 35,375 
$ 24,324 
$ 33,270 
$ 24,449 
Warranty reserves accrued
4,201 
3,691 
10,427 
7,455 
Liabilities assumed in the Merger
 
7,481 
 
7,481 
Adjustments to pre-existing reserves
(14)
(809)
1,286 
209 
Warranty expenditures
(2,819)
(2,596)
(8,240)
(7,503)
Warranty reserves, end of period
$ 36,743 
$ 32,091 
$ 36,743 
$ 32,091 
Stock-Based Compensation - Additional Information (Detail) (USD $)
In Millions, except Share data, unless otherwise specified
9 Months Ended 0 Months Ended 0 Months Ended
Sep. 30, 2015
Sep. 30, 2015
Restricted Stock Units (RSUs) [Member]
Mar. 5, 2015
Restricted Stock Units (RSUs) [Member]
Employees and Officers [Member]
Aug. 12, 2015
Restricted Stock Units (RSUs) [Member]
Board of Directors [Member]
Mar. 9, 2015
Performance-based RSUs [Member]
Total Shareholder Return [Member]
Mar. 9, 2015
Performance-based RSUs [Member]
Earnings Per Share [Member]
Mar. 9, 2015
Performance-based RSUs [Member]
Stock Price [Member]
Mar. 9, 2015
Performance-based RSUs [Member]
Chief Executive Officer [Member]
Mar. 9, 2015
Performance-based RSUs [Member]
President [Member]
Mar. 9, 2015
Performance-based RSUs [Member]
Chief Financial Officer [Member]
Sep. 30, 2015
WRECO Transaction [Member]
Sep. 30, 2015
2013 Incentive Plan [Member]
Jul. 16, 2014
WRECO equity incentive plans [Member]
WRECO Transaction [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Common stock
 
 
 
 
 
 
 
 
 
 
 
11,727,833 
 
Shares available for future grant
 
 
 
 
 
 
 
 
 
 
 
9,563,491 
 
Exchange ratio
 
 
 
 
 
 
 
 
 
 
 
 
2.1107 
Number of registered shares
 
 
 
 
 
 
 
 
 
 
 
 
4,105,953 
Unrecognized stock based compensation related to all stock-based awards
$ 19.2 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average period, expense to recognize
1 year 10 months 24 days 
 
 
 
 
 
 
 
 
 
 
 
 
Restricted stock units, vesting period
 
 
3 years 
 
 
 
 
 
 
 
 
 
 
Restricted stock units, granted
 
1,580,499 
440,800 
69,008 
 
 
 
411,804 
384,351 
274,536 
 
 
 
Closing stock price on date of grant
 
 
$ 14.97 
$ 14.49 
$ 7.55 
$ 14.57 
$ 7.90 
 
 
 
$ 15.85 
 
 
Allocation amount percentage
 
 
 
 
33.33% 
33.33% 
33.33% 
 
 
 
 
 
 
Performance period initiation date
 
 
 
 
Jan. 01, 2015 
Jan. 01, 2015 
Jan. 01, 2016 
 
 
 
 
 
 
Performance period expiration date
 
 
 
 
Dec. 31, 2017 
Dec. 31, 2017 
Dec. 31, 2017 
 
 
 
 
 
 
Stock-Based Compensation - Summary of Stock Option Awards (Detail) (Employee Stock Option [Member], USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended 12 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Employee Stock Option [Member]
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Options, Outstanding, Balance
3,467,086 
 
Options, Granted
 
Options, Exercised
(171,716)
 
Options, Forfeited
(65,356)
 
Options, Outstanding, Balance
3,230,014 
3,467,086 
Options exercisable at September 30, 2015
2,791,472 
 
Weighted Average Exercise Price, Outstanding, Balance
$ 13.05 
 
Weighted Average Exercise Price, Exercised
$ 11.54 
 
Weighted Average Exercise Price, Forfeited
$ 14.00 
 
Weighted Average Exercise Price, Outstanding, Balance
$ 13.12 
$ 13.05 
Weighted Average Exercise Price, Options exercisable at September 30, 2015
$ 12.42 
 
Weighted Average Remaining Contractual Life, Outstanding
5 years 2 months 12 days 
6 years 
Weighted Average Remaining Contractual Life, Options exercisable at September 30, 2015
4 years 8 months 12 days 
 
Aggregate Intrinsic Value, Outstanding, Balance
 
$ 7,642 
Aggregate Intrinsic Value, Outstanding, Options exercisable at September 30, 2015
$ 1,884 
 
Stock-Based Compensation - Summary of Restricted Stock Units (Detail) (Restricted Stock Units (RSUs) [Member], USD $)
In Thousands, except Share data, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Restricted Stock Units (RSUs) [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Nonvested Restricted Stock Units, Beginning Balance
900,547 
Nonvested Restricted Stock Units, Granted
1,580,499 
Nonvested Restricted Stock Units, Vested
(453,685)
Nonvested Restricted Stock Units, Forfeited
(66,918)
Nonvested Restricted Stock Units, Ending Balance
1,960,443 
Weighted Average Grant Date Fair Value, Beginning Balance
$ 15.62 
Weighted Average Grant Date Fair Value, Granted
$ 11.59 
Weighted Average Grant Date Fair Value, Vested
$ 13.85 
Weighted Average Grant Date Fair Value, Forfeited
$ 14.56 
Weighted Average Grant Date Fair Value, Ending Balance
$ 12.21 
Aggregate Intrinsic Value, Beginning Balance
$ 13,461 
Aggregate Intrinsic Value, Granted
18,315 
Aggregate Intrinsic Value, Ending Balance
$ 25,662 
Income Taxes - Additional Information (Detail) (USD $)
3 Months Ended 9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Income Tax Disclosure [Abstract]
 
 
 
 
 
Net deferred tax assets
$ 141,479,000 
 
$ 141,479,000 
 
$ 157,821,000 
Valuation allowance related to net deferred tax assets
4,300,000 
 
4,300,000 
 
6,200,000 
Provision for income taxes
(28,021,000)
(6,021,000)
(66,088,000)
(16,352,000)
 
Liability for uncertain tax positions
$ 16,563,000 
 
$ 16,563,000 
 
$ 13,797,000 
Related Party Transactions - Schedule of Allocated Corporate General and Administrative Expenses (Detail) (Weyerhaeuser [Member], USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2014
Weyerhaeuser [Member]
 
Related Party Transaction [Line Items]
 
General and administrative
$ 10,735 
Related Party Transactions - Additional Information (Detail) (USD $)
1 Months Ended
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2015
Weyerhaeuser [Member]
Accrued Expenses and Other Liabilities [Member]
Dec. 31, 2014
Weyerhaeuser [Member]
Accrued Expenses and Other Liabilities [Member]
Jan. 31, 2015
Starwood Capital Group [Member]
Lot
Related Party Transaction [Line Items]
 
 
 
 
 
Income tax liability to Weyerhaeuser
$ 8,600,000 
$ 15,659,000 
$ 8,600,000 
$ 15,659,000 
 
Number of lots acquired
 
 
 
 
46 
Payment for acquiring lots
 
 
 
 
$ 2,800,000 
Supplemental Disclosure to Consolidated Statements of Cash Flow - Supplemental Disclosure to Consolidated Statements of Cash Flows (Detail) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Supplemental disclosure of cash flow information:
 
 
Interest, net of amounts capitalized
 
$ 1,372 
Income taxes
44,394 
14,962 
Supplemental disclosures of noncash activities:
 
 
Increase in real estate inventory due to distribution of land from an unconsolidated joint venture
 
5,132 
Distribution to Weyerhaeuser of excluded assets and liabilities
 
125,019 
Amounts owed to Weyerhaeuser related to the tax sharing agreement
 
15,688 
Noncash settlement of debt payable to Weyerhaeuser
 
70,082 
Accrued liabilities related to the purchase of operating properties and equipment
1,877 
 
Amortization of senior note discount
1,155 
 
Effect of net consolidation and de-consolidation of variable interest entities:
 
 
(Decrease) increase in consolidated real estate inventory not owned
(3,556)
4,497 
Increase in accrued expenses and other liabilities
300 
 
Decrease (increase) in noncontrolling interests
$ 3,256 
$ (4,497)
Supplemental Guarantor Information - Additional Information (Detail) (USD $)
Sep. 30, 2015
May 31, 2015
Non-Guarantor Subsidiaries |
Maximum [Member]
 
 
Condensed Financial Statements Captions [Line Items]
 
 
Percentage of Non Guarantor Subsidiaries
3.00% 
 
550 million revolving credit facility [Member]
 
 
Condensed Financial Statements Captions [Line Items]
 
 
Unsecured revolving credit facility
$ 550,000,000 
$ 550,000,000 
Supplemental Guarantor Information - Condensed Consolidating Balance Sheet (Detail) (USD $)
In Thousands, unless otherwise specified
Sep. 30, 2015
Dec. 31, 2014
Sep. 30, 2014
Dec. 31, 2013
Assets
 
 
 
 
Cash and cash equivalents
$ 96,993 
$ 170,629 
$ 147,683 
$ 4,510 
Receivables
32,921 
20,118 
 
 
Real estate inventories
2,576,402 
2,280,183 
 
 
Investments in unconsolidated entities
17,340 
16,805 
 
 
Goodwill and other intangible assets, net
162,162 
162,563 
 
 
Deferred tax assets
141,479 
157,821 
 
 
Other assets
84,516 
105,405 
 
 
Total assets
3,111,813 
2,913,524 
 
 
Liabilities
 
 
 
 
Accounts payable
67,747 
68,860 
 
 
Accrued expenses and other liabilities
210,707 
210,009 
 
 
Notes payable and other borrowings
349,392 
260,000 
 
 
Seller financed loans
7,572 
14,677 
 
 
Senior notes
888,657 
887,502 
 
 
Total liabilities
1,524,075 
1,441,048 
 
 
Equity
 
 
 
 
Total stockholders’ equity
1,576,176 
1,454,180 
 
 
Noncontrolling interests
11,562 
18,296 
 
 
Total equity
1,587,738 
1,472,476 
 
825,517 
Total liabilities and equity
3,111,813 
2,913,524 
 
 
Reporting Entity [Member] |
Issuer [Member]
 
 
 
 
Assets
 
 
 
 
Cash and cash equivalents
37,015 
105,888 
88,977 
 
Receivables
11,225 
5,050 
 
 
Intercompany receivables
872,290 
797,480 
 
 
Real estate inventories
675,914 
613,665 
 
 
Goodwill and other intangible assets, net
162,162 
156,603 
 
 
Investments in subsidiaries
1,045,130 
941,397 
 
 
Deferred tax assets
23,630 
23,630 
 
 
Other assets
76,629 
55,199 
 
 
Total assets
2,903,995 
2,698,912 
 
 
Liabilities
 
 
 
 
Accounts payable
14,821 
25,800 
 
 
Accrued expenses and other liabilities
67,777 
57,353 
 
 
Notes payable and other borrowings
349,392 
260,000 
 
 
Seller financed loans
7,172 
14,077 
 
 
Senior notes
888,657 
887,502 
 
 
Total liabilities
1,327,819 
1,244,732 
 
 
Equity
 
 
 
 
Total stockholders’ equity
1,576,176 
1,454,180 
 
 
Total equity
1,576,176 
1,454,180 
 
 
Total liabilities and equity
2,903,995 
2,698,912 
 
 
Reporting Entity [Member] |
Guarantor Subsidiaries [Member]
 
 
 
 
Assets
 
 
 
 
Cash and cash equivalents
59,978 
64,741 
58,706 
4,510 
Receivables
21,696 
15,068 
 
 
Real estate inventories
1,900,488 
1,666,518 
 
 
Investments in unconsolidated entities
17,340 
16,805 
 
 
Goodwill and other intangible assets, net
 
5,960 
 
 
Deferred tax assets
117,849 
134,191 
 
 
Other assets
7,887 
50,206 
 
 
Total assets
2,125,238 
1,953,489 
 
 
Liabilities
 
 
 
 
Accounts payable
52,926 
43,060 
 
 
Intercompany payables
872,290 
797,480 
 
 
Accrued expenses and other liabilities
142,930 
152,656 
 
 
Seller financed loans
400 
600 
 
 
Total liabilities
1,068,546 
993,796 
 
 
Equity
 
 
 
 
Total stockholders’ equity
1,045,130 
941,397 
 
 
Noncontrolling interests
11,562 
18,296 
 
 
Total equity
1,056,692 
959,693 
 
 
Total liabilities and equity
2,125,238 
1,953,489 
 
 
Consolidating Adjustments [Member]
 
 
 
 
Assets
 
 
 
 
Intercompany receivables
(872,290)
(797,480)
 
 
Investments in subsidiaries
(1,045,130)
(941,397)
 
 
Total assets
(1,917,420)
(1,738,877)
 
 
Liabilities
 
 
 
 
Intercompany payables
(872,290)
(797,480)
 
 
Total liabilities
(872,290)
(797,480)
 
 
Equity
 
 
 
 
Total stockholders’ equity
(1,045,130)
(941,397)
 
 
Total equity
(1,045,130)
(941,397)
 
 
Total liabilities and equity
$ (1,917,420)
$ (1,738,877)
 
 
Supplemental Guarantor Information - Condensed Consolidating Statement of Operations (Detail) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Sep. 30, 2015
Sep. 30, 2014
Dec. 31, 2014
Revenues:
 
 
 
 
 
Home sales
$ 642,352 
$ 471,801 
$ 1,443,855 
$ 1,023,312 
 
Land and lot sales
4,876 
5,550 
74,366 
36,449 
 
Other operations
913 
569 
2,695 
8,854 
 
Total revenues
648,141 
477,920 
1,520,916 
1,068,615 
 
Expenses:
 
 
 
 
 
Cost of home sales
507,543 
385,400 
1,149,191 
819,377 
 
Cost of land and lot sales
3,451 
2,317 
17,324 
30,245 
 
Other operations
570 
556 
1,724 
2,755 
 
Sales and marketing
30,038 
28,393 
78,958 
73,096 
 
General and administrative
26,783 
20,951 
83,261 
57,140 
 
Restructuring charges
2,010 
7,024 
2,730 
9,202 
 
Total expenses
570,395 
444,641 
1,333,188 
991,815 
 
Income from operations
77,746 
33,279 
187,728 
76,800 
 
Equity in loss of unconsolidated entities
(3)
(82)
(84)
(219)
 
Transaction expenses
 
(16,710)
 
(17,216)
 
Other income (loss), net
47 
499 
272 
(242)
 
Income before taxes
77,790 
16,986 
187,916 
59,123 
 
Provision for income taxes
(28,021)
(6,021)
(66,088)
(16,352)
 
Net income
49,769 
10,965 
121,828 
42,771 
84,197 
Net (income) loss attributable to noncontrolling interests
393 
 
(1,439)
 
 
Net income available to common stockholders
50,162 
10,965 
120,389 
42,771 
 
Reporting Entity [Member] |
Issuer [Member]
 
 
 
 
 
Revenues:
 
 
 
 
 
Home sales
224,244 
123,456 
461,654 
123,456 
 
Other operations
 
(11)
 
(11)
 
Total revenues
224,244 
123,445 
461,654 
123,445 
 
Expenses:
 
 
 
 
 
Cost of home sales
182,754 
108,687 
376,100 
108,687 
 
Sales and marketing
7,286 
3,956 
17,714 
3,956 
 
General and administrative
12,942 
7,246 
38,874 
7,246 
 
Restructuring charges
(83)
 
(169)
 
 
Total expenses
202,899 
119,889 
432,519 
119,889 
 
Income from operations
21,345 
3,556 
29,135 
3,556 
 
Transaction expenses
 
(6,381)
 
(6,381)
 
Other income (loss), net
(37)
(149)
 
Income before taxes
21,308 
(2,816)
28,986 
(2,816)
 
Provision for income taxes
(9,070)
2,032 
(12,285)
2,032 
 
Equity of net income of subsidiaries
37,924 
11,749 
103,688 
43,555 
 
Net income
50,162 
 
120,389 
 
 
Net income available to common stockholders
50,162 
10,965 
120,389 
42,771 
 
Reporting Entity [Member] |
Guarantor Subsidiaries [Member]
 
 
 
 
 
Revenues:
 
 
 
 
 
Home sales
418,108 
348,345 
982,201 
899,856 
 
Land and lot sales
4,876 
5,550 
74,366 
36,449 
 
Other operations
913 
580 
2,695 
8,865 
 
Total revenues
423,897 
354,475 
1,059,262 
945,170 
 
Expenses:
 
 
 
 
 
Cost of home sales
324,789 
276,713 
773,091 
710,690 
 
Cost of land and lot sales
3,451 
2,317 
17,324 
30,245 
 
Other operations
570 
556 
1,724 
2,755 
 
Sales and marketing
22,752 
24,437 
61,244 
69,140 
 
General and administrative
13,841 
13,705 
44,387 
49,894 
 
Restructuring charges
2,093 
7,024 
2,899 
9,202 
 
Total expenses
367,496 
324,752 
900,669 
871,926 
 
Income from operations
56,401 
29,723 
158,593 
73,244 
 
Equity in loss of unconsolidated entities
(3)
(82)
(84)
(219)
 
Transaction expenses
 
(10,329)
 
(10,835)
 
Other income (loss), net
84 
490 
421 
(251)
 
Income before taxes
56,482 
19,802 
158,930 
61,939 
 
Provision for income taxes
(18,951)
(8,053)
(53,803)
(18,384)
 
Net income
37,531 
 
105,127 
 
 
Net (income) loss attributable to noncontrolling interests
393 
 
(1,439)
 
 
Net income available to common stockholders
37,924 
11,749 
103,688 
43,555 
 
Consolidating Adjustments [Member]
 
 
 
 
 
Expenses:
 
 
 
 
 
Equity of net income of subsidiaries
(37,924)
(11,749)
(103,688)
(43,555)
 
Net income
(37,924)
 
(103,688)
 
 
Net income available to common stockholders
$ (37,924)
$ (11,749)
$ (103,688)
$ (43,555)
 
Supplemental Guarantor Information - Condensed Consolidating Statement of Cash Flows (Detail) (USD $)
In Thousands, unless otherwise specified
9 Months Ended
Sep. 30, 2015
Sep. 30, 2014
Cash flows from operating activities
 
 
Net cash used in operating activities
$ (140,011)
$ (140,429)
Cash flows from investing activities:
 
 
Purchases of property and equipment
(1,059)
(6,068)
Cash acquired in the Merger
 
53,800 
Proceeds from sale of property and equipment
 
22 
Investments in unconsolidated entities
(1,458)
(573)
Distributions from unconsolidated entities
319 
 
Net cash (used in) provided by investing activities
(2,198)
47,181 
Cash flows from financing activities:
 
 
Borrowings from debt
140,000 
50,000 
Repayment of debt
(57,713)
 
Debt issuance costs
(2,688)
(23,003)
Proceeds from issuance of senior notes
 
886,698 
Bridge commitment fee
 
(10,322)
Changes in debt payable to Weyerhaeuser
 
(623,589)
Change in book overdrafts
 
(22,492)
Distributions to Weyerhaeuser
 
(8,860)
Net proceeds (repayments) of debt held by variable interest entities
(5,927)
5,120 
Contributions from noncontrolling interests
4,281 
 
Distributions to noncontrolling interests
(9,198)
(18,703)
Proceeds from issuance of common stock under share-based awards
1,616 
 
Excess tax benefits of share-based awards
392 
1,572 
Minimum tax withholding paid on behalf of employees for restricted stock units
(2,190)
 
Net cash provided by financing activities
68,573 
236,421 
Net (decrease) increase in cash and cash equivalents
(73,636)
143,173 
Cash and cash equivalents - beginning of period
170,629 
4,510 
Cash and cash equivalents - end of period
96,993 
147,683 
Reporting Entity [Member] |
Issuer [Member]
 
 
Cash flows from operating activities
 
 
Net cash used in operating activities
(69,362)
(26,882)
Cash flows from investing activities:
 
 
Purchases of property and equipment
(382)
(659)
Cash acquired in the Merger
 
53,800 
Intercompany
(78,354)
(850,977)
Net cash (used in) provided by investing activities
(78,736)
(797,836)
Cash flows from financing activities:
 
 
Borrowings from debt
140,000 
50,000 
Repayment of debt
(57,513)
 
Debt issuance costs
(2,688)
(23,003)
Proceeds from issuance of senior notes
 
886,698 
Proceeds from issuance of common stock under share-based awards
1,616 
 
Minimum tax withholding paid on behalf of employees for restricted stock units
(2,190)
 
Net cash provided by financing activities
79,225 
913,695 
Net (decrease) increase in cash and cash equivalents
(68,873)
88,977 
Cash and cash equivalents - beginning of period
105,888 
 
Cash and cash equivalents - end of period
37,015 
88,977 
Reporting Entity [Member] |
Guarantor Subsidiaries [Member]
 
 
Cash flows from operating activities
 
 
Net cash used in operating activities
(70,649)
(113,547)
Cash flows from investing activities:
 
 
Purchases of property and equipment
(677)
(5,409)
Proceeds from sale of property and equipment
 
22 
Investments in unconsolidated entities
(1,458)
(573)
Distributions from unconsolidated entities
319 
 
Net cash (used in) provided by investing activities
(1,816)
(5,960)
Cash flows from financing activities:
 
 
Repayment of debt
(200)
 
Bridge commitment fee
 
(10,322)
Changes in debt payable to Weyerhaeuser
 
(623,589)
Change in book overdrafts
 
(22,492)
Distributions to Weyerhaeuser
 
(8,860)
Net proceeds (repayments) of debt held by variable interest entities
(5,927)
5,120 
Contributions from noncontrolling interests
4,281 
 
Distributions to noncontrolling interests
(9,198)
(18,703)
Excess tax benefits of share-based awards
392 
1,572 
Intercompany
78,354 
850,977 
Net cash provided by financing activities
67,702 
173,703 
Net (decrease) increase in cash and cash equivalents
(4,763)
54,196 
Cash and cash equivalents - beginning of period
64,741 
4,510 
Cash and cash equivalents - end of period
59,978 
58,706 
Consolidating Adjustments [Member]
 
 
Cash flows from investing activities:
 
 
Intercompany
78,354 
850,977 
Net cash (used in) provided by investing activities
78,354 
850,977 
Cash flows from financing activities:
 
 
Intercompany
(78,354)
(850,977)
Net cash provided by financing activities
$ (78,354)
$ (850,977)