LGI Homes, Inc.

Welcome to the LGI Homes fourth quarter and full year 2021 conference call. Today's call is being recorded and a replay will be available on the company's website later today at www.lgihomes.com. We have allocated an hour for prepared remarks and a Q&A. If anyone should require operator assistance during this conference, please press star zero. At this time, I'll turn the call over to Joshua Fatter, Vice President of Investor Relations at LGI Homes. Mr. Fatter, you may begin.

Thank you. Good afternoon and welcome to our conference call to discuss our fourth quarter and full year 2021 results. I'll remind listeners that this call will contain forward-looking statements that include statements regarding LGI Home's business strategy, outlook, plans, objectives, and guidance for 2022. All such statements reflect management's current expectations. However, these statements involve assumptions and estimates. and are therefore subject to risks and uncertainties that could cause management's expectations to prove to be incorrect. You should review our filings with the SEC, including our risk factors and cautionary statement about forward-looking statements sections, for a discussion of the risks, uncertainties, and other factors that could cause our actual results to differ from those presented in these forward-looking statements. You should consider all forward-looking statements in light of the related risks and not place undue reliance on these forward-looking statements which speak only as of the date of this conference call and are not guarantees of future performance. Additionally, we will discuss non-GAAP financial measures on today's call. Such information is not intended to be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Reconciliations of non-GAAP financial measures to the most comparable measures prepared in accordance with GAAP can be found in the earnings press release that we issued this morning or our annual report on Form 10-K for the fiscal year ended December 31, 2021, that we expect to file with the SEC later today. This filing will be accessible on the SEC's website and in the Investor Relations section of our website. Our hosts for today's call are Mr. Eric Lieber, LGI Home's Chief Executive Officer and Chairman of the Board, and Mr. Charles Merdian, Chief Financial Officer and Treasurer. I will now turn the call over to Eric.

Thank you, Josh. Welcome to everyone who joined our call today. I'll open with highlights of our outstanding performance and key accomplishments in 2021. Charles will then provide details on our financial results. Finally, I'll conclude with our current view on the market and details of our guidance for 2022. By every account, 2021 was an extraordinary year for LGI Homes. Despite numerous challenges, we again set new records for closings and revenues. For the second year in a row, full-year revenue increased nearly 29% to over $3 billion, driven by a 12% increase in closings to 10,442 homes, which was at the top end of our guidance in November and significantly higher than the closing guidance provided this time last year. This marked our eighth consecutive year of double-digit growth in both closings and revenue. For the fourth quarter of 2021, we averaged over eight closings per community per month company-wide. Our top five markets for the quarter were DFW with 13.6 closings per community per month, Houston with 12.5, Daytona Beach and Nashville, each with 12.3, and Las Vegas with 12. We averaged a record 8.3 closings per community per month company-wide in 2021. This was an increase of 20% year-over-year and 26% higher than a historical five-year average of 6.6. Our number one market this year was San Antonio with 12.7 closings per community per month. Austin and Dallas-Fort Worth tied for second place, each with 12.4. Houston came in fourth with 10.8. And rounding out the top five was Charlotte with 10.5 closings per community, per month. Our ability to translate our closings and industry-leading absorptions into consistent profitability continues to differentiate our business. We delivered all-time records in every profitability metric, gross margin, adjusted gross margin, EBITDA, pre-tax income, net income, and EPS, together resulting in return on equity for the year of 34%, significantly outperforming both the S&P 500 and most of our sector. In line with our November guidance, we finished the year with 101 active communities and we expanded our geographic presence in the Mid-Atlantic with the addition of two new markets, Baltimore, Maryland and Norfolk, Virginia. A few additional highlights from 2021. We acquired two builders this year that added over 3,600 owned and controlled lots to our inventories. Both companies are fully integrated into our organization and are operating the LGI way. For the second year in a row, 100% of the homes we closed included WaterSense fixtures, Energy Star appliances, LED lighting, and other energy-saving products designed to improve the efficiency of our homes, saving our customers money, easing stress on our infrastructure, and reducing impacts to the environment. Additionally, 90% of the homes we closed in 2021 qualified for 45L tax credits. With a focus on our future growth, we invested over $1 billion last year, expanding our land portfolio to 92,000 owned and controlled lots, an increase of 49%. Thanks to the efforts of our land acquisitions teams across the country, we continue to source new land that meets our strict underwriting standards, and will fuel our profitable growth for years to come. During the year, we made significant progress strengthening our balance sheet. In April, we amended our credit facility, increasing our capacity to $850 million, while simultaneously lowering the cost. In June, we refinanced our $300 million senior notes due 2026, which, in combination with the changes to our revolver, will result in nearly $14 million in annualized interest savings. During the year, we returned almost $194 million to shareholders through the purchase of 1.3 million shares of our common stock, and this morning we announced our Board's approval of an additional $200 million for future share repurchases. Finally, I'm pleased to announce that LGI Mortgage Solutions, our joint venture with Loan Depot, It's now licensed in 12 states, and we expect it to be operational in all of our markets by the end of the first quarter. With that, I'll turn the call over to Charles for more details on our record financial results.