LGI Homes, Inc.

Hello and welcome to LGI Homes first quarter 2024 conference call. Today's call is being recorded and a replay will be available on the company's website at www.lgihomes.com. After management's prepared comments, there will be an opportunity to ask questions. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand has been raised. To withdraw your question, please press star 11 again. I would now like to hand the conference over to Executive Vice President of Investor Relations and Capital Markets, Joshua Fatter.

Thanks, and good afternoon. I'll remind listeners that this call contains forward-looking statements, including management's views on the company's business strategy and outlook, plans, objectives, and guidance for future periods. Such statements reflect management's current expectations and involve assumptions and estimates that are subject to risks and uncertainties that could cause those expectations to prove to be incorrect. You should review our filings with the SEC for a discussion of the risks, uncertainties, and other factors that could cause actual results to differ from those presented today. All forward-looking statements must be considered in light of those related risks, and you should not place undue reliance on such statements, which reflect management's current viewpoints and are not guarantees of future performance. On this call, we'll discuss non-GAAP financial measures that are not intended to be considered in isolation or as substitutes for 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 press release we issued this morning and in our quarterly report on Form 10-Q for the quarter ended March 31st, 2024, 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. With me today are Eric Lieper, LGI Homes Chief Executive Officer and Chairman of the Board, and Charles Murdian, Chief Financial Officer and Treasurer. I'll now turn the call over to Eric.

Thanks, Josh. Good afternoon and welcome to our first quarter earnings call. We delivered 1,083 homes in the first quarter at an average sales price of over $360,000, resulting in total revenue of $391 million. During the first quarter, our top markets on a closings per community basis were Raleigh with 7.7 closings per month, followed by Southern California with 5.5 closings, and Washington, D.C. with 5. Congratulations to the teams in these markets for the results last quarter. Despite the slower start and closings, the improved lead and sales trends we saw in February accelerated further in March. The resulting increase in net orders allowed us to finish the quarter with 1,335 homes in backlog compared to 590 homes in backlog when we ended the fourth quarter, putting us in a much stronger position entering the second quarter. It's also worth noting that these improvements were accomplished solely through marketing and training, not through price discounting or increasing incentives. These recent sales trends give us confidence that demand remains healthy, supported by positive long-term fundamentals, including strong demographic trends and a limited supply of affordable homes. Along with increasing leads and sales, another positive highlight was our success controlling costs and protecting our margins. We delivered a first quarter gross margin of 23.4%, up 310 basis points compared to last year, and in line with our performance in the fourth quarter. Adjusted gross margin was 25.3%, up 320 basis points over last year and 20 basis points sequentially. Much of the land we acquired over the last few years that's been working through development and slowly accumulating on our balance sheet is now beginning to deliver closings at margins in line with our historical results. As more of these land deals come online, we expect revenue to grow at a faster pace than inventory, resulting in increasingly positive impacts to our overall performance and return metrics. Finally, we ended the quarter with 120 active communities an increase of 21% over the prior year. This is the highest community count in our history. In addition, we opened 13 new communities in March. They'll be added to community count as they deliver closings. I'll now turn the call over to Charles for more details on our financial results.