M.D.C. Holdings, Inc.

Good day, ladies and gentlemen, and welcome to MDC Holdings' 2021 Second Quarter Earnings Conference Call. If you require operator assistance, please press star then zero. At this time, for opening remarks, I would like to turn the call to Derek Kimmerle, Director of SEC Reporting.

Thank you. Good morning, ladies and gentlemen, and welcome to MDC Holdings' 2021 Second Quarter Earnings Conference Call. On the call with me today I have Larry Meisel, Executive Chairman, David Mandrich, Chief Executive Officer, and Bob Martin, Chief Financial Officer. At this time, all participants are in a listen-only mode. After finishing our prepared remarks, we will conduct a question-and-answer session, at which time we request that participants limit themselves to one question and one follow-up question. Please note that this conference is being recorded and will be available for replay. For information on how to access the replay, please visit our website at mdcholdings.com. Before turning the call over to Larry and David, it should be noted that certain statements made during this conference call, including those related to MDC's business, financial condition, results of operation, cash flows, strategies and prospects, and responses to questions, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve known and unknown risks, uncertainties, and other factors that may cause the company's actual results, performance, or achievements to be materially different from the results, performance, or achievements expressed or implied by the forward-looking statement. These and other factors that could impact the company's actual performance are set forth in the company's second quarter 2021 Form 10-Q, which is expected to be filed with the SEC today. It should also be noted that SEC Regulation G requires that certain information accompany the use of non-GAAP financial measures. Any information required by Regulation G is posted on our website with our webcast slides. And now I will turn the call over to Mr. Meisel for his opening remarks.

Thank you for joining us today. As we go over our results for the second quarter of 2021, provide an update on current market conditions, and share our thoughts on the outlook of our company and the industry as a whole. MDC Holdings reported net income of $154 million for the second quarter of 2021, representing an increase of 83% over the second quarter of last year. Home sales revenues grew 54% year over year, thanks to a 43% increase in deliveries and an 8% rise in our average closing price. We posted another quarter of operating margin expansion driven by further improvement to our home building gross margin and our SG&A leverage. These results are a testament to the continued strength of the housing market as well as to our ability to execute effectively in spite of the operating challenges facing our industry. Net new orders for the quarter rose 14% year over year on a sales pace of 4.8 homes per community per month. Similar to last quarter, our sales efforts were tempered by our objective to maximize pricing and maintain a manageable closing cadence for homes and backlog. We believe this strategy has been effective in generating higher profits for our company, allowing us to close homes at higher prices and at a consistent pace, while staying ahead of cost increases. Demand continues across all of our markets, driven by the strong demographic forces we have highlighted in the past and the lack of available supply in both the new and existing home markets. These two factors have created a supply-demand imbalance that we believe will serve as tailwinds for industry. Equally important to our sales success has been our focus on affordability. and our adherence to a build to order operating model. We are keenly aware of the home price appreciation that occurs across the country and strive to provide housing options that are attainable for the first time home buyers. By value engineering our homes with smaller floor plans and the same high quality construction we were able to offer our customers a compelling value along with an ability to personalize their home with options and upgrades at our home galleries. We believe this operating philosophy has led to higher demand for our homes and improved our gross margin profile. I'll now turn the call over to our President and Chief Executive Officer, David Mandridge, for additional comments on the current market conditions and our strategic focus. David.