Forestar Group Inc.

Good afternoon and welcome to Four Star's third quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I will now turn the call over to Katie Smith, Director of Finance and Investor Relations for Four Star.

Thank you, Paul. And welcome to our call to discuss our results for the third quarter of fiscal 2021. Before we get started, today's call includes forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Although Four Star believes any such statements are based on reasonable assumptions, there is no assurance that actual outcomes will not be materially different. All forward-looking statements are based upon information available to Four Star on the date of this conference call and we do not undertake any obligation to update or revise any forward-looking statements publicly. Additional information about factors that could lead to material changes in performance is contained in Four Star's annual report on Form 10-K and its most recent quarterly report on Form 10-Q, both of which are filed with the SEC. This afternoon's earnings release can be found on our website at investor.fourstar.com, and we plan to file our 10-Q early next week. After this call, we will post an updated investor presentation to our investor relations site under events and presentations for your reference. Now I'll turn the call over to Dan Bartok, our CEO.

Thank you, Katie, and good afternoon, everyone. In addition to Katie, I am pleased to be joined on the call today by Jim Allen, our Chief National Officer and Jessica Hansen, ER Horton's Vice President of Investor Relations. The four-star team delivered an outstanding third quarter. We have built our team quickly, and they have done an amazing job of executing on our development projects and identifying attractive investment opportunities. We accelerated our development activities last year, and now that those lots are beginning to deliver, it has put us in a position to capitalize on the significant market demand for finished lots. This resulted in significant revenue growth and market margin expansion, creating meaningful value for our shareholders. Our development teams and contractors continue to execute solidly, positioning us for long-term profitable growth. We have delivered over 11,000 lots to homebuilders fiscal year to date, enabling us to increase our expected deliveries for fiscal 2021 to between 15,500 and 16,000 lots. Executing on our plan is delivering measurable results. Our third quarter gross profit margin increased 610 basis points year over year to 17.8%. Several factors contributed to this quarter's gross margin improvement. The demand for developed lots remains incredibly strong as home builders bolster their inventory positions to meet sales demand. This, combined with our strategy of pricing lots closer to the time of delivery, enabled Four Star to take advantage of favorable market conditions when setting finished lot prices in select markets. We also made further progress in delivering more lots from Four Star source projects, and we continued to reduce our exposure to lot banking. We are committed to our returns-focused business model. Our high turnover, low risk manufacturing strategy led us to achieve a 10% return on equity for the trailing 12 months ended June 30th, 2021. This was a 390 basis point improvement year over year in our fifth consecutive quarter of ROE improvement. We expect to continue to increase our returns on equity and inventory as our platform gains additional maturity and scale, and our team captures increased share in their respective markets. Jim will now discuss our third quarter results in more detail. Thank you, Dan.