Forestar Group Inc.

Good morning and welcome to Forestar's third quarter 2026 earnings conference call. At this time, all participants have been placed on a listen-only mode and the floor will be open for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Chris Hibbetts, Vice President of Finance and Investor Relations for Forestar.

Thank you, Jenny. Good morning, and welcome to our call to discuss Forestar's third quarter results. Before we get started, I want to remind everyone that today's call includes forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Although Forestar 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 Forestar 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 Forestar's annual report on Form 10-K and its most recent quarterly report on Form 10-Q, both of which are filed with the Securities and Exchange Commission. Our earnings release is on our website at investor.Forestar.com and we plan to file our 10-Q later this 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 will turn the call over to Andy Oxley, our president and CEO.

Thanks, Chris. Good morning, everyone. I am also joined on the call today by Jim Allen, our chief financial officer, and Mark Walker, our chief operating officer. The Forestar team achieved solid third quarter results with revenues of $407 million, up 4% from the prior year quarter, on 3,659 lots sold. Earnings per diluted share increased 8% to 70 cents, and pre-tax income increased 12% to $48.7 million. Book value per share increased 10% from a year ago to $36.40, and our contracted backlog remains strong with visibility towards $2.3 billion of future revenue. Ongoing affordability constraints and cautious consumer sentiment continue to impact the pace of new home sales. In response, we are managing our inventory investments with discipline and flexibility and we ended the quarter with approximately $1.1 billion of liquidity. We also reached a significant milestone this quarter. delivering our 100,000th lot since D.R. Horton made its transformative investment in Forestar in 2017. Forestar has grown to a proven, scalable platform, and we couldn't be prouder of what our teams have built to get us here. Looking ahead, we remain focused on turning our land and lot inventory efficiently, maximizing returns, and consolidating market share. with a strong balance sheet, operating expertise, and a diverse national platform, Forestar is well positioned to navigate market conditions and extend its leadership position in the highly fragmented lot development industry. We will now discuss our third quarter financial results in more detail.