PulteGroup, Inc.

Good morning. My name is Audra, and I will be your conference operator today. At this time, I would like to welcome everyone to the Pulte Group, Inc. Third Quarter 2024 Earnings Conference Call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star key, followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. At this time, I'd like to turn the conference over to Jim Zumer. Please go ahead.

Thank you, Audra, and good morning. I want to welcome all participants to today's earnings call to review Pulte Group's operating and financial performance for the company's third quarter ended September 30, 2024. Here to review Pulte Group's Q3 results are Ryan Marshall, President and CEO, Bob O'Shaughnessy, Executive Vice President and CFO, and Jim Osowski, Senior Vice President of Finance. A copy of our earnings release and this morning's presentation slides have been posted to our corporate website at PulteGroup.com. We will post an audio replay of this call later today. I want to alert everyone that today's presentation includes forward-looking statements about the company's expected future performance. Actual results can differ materially from those suggested by our comments made today. The most significant risk factors that could affect future results are summarized as part of today's earnings release.

within the accompanying presentation slides these risk factors and other key information are detailed on our icc filings including our annual and quarterly reports now let me turn the call over to ryan marshall right thanks jim i appreciate everyone joining our call this morning as we discuss another quarter of strong operating and financial results for bolting group as detailed in this morning's press release driven primarily by a 12 increase in closings we reported a 16% year-over-year increase in third quarter earnings to $3.35 per share. Inclusive of our strong Q3 financial performance, for the first three quarters of 2024, Pulte Group has realized double-digit increases in closings, home sale revenues, and pre-tax income, along with a 22% increase in reported earnings to $10.28 per share. In addition to delivering significant growth in revenues and earnings for the trailing 12-month period, Pulte Group realized a return on equity of 27%, while continuing to drive strong cash flow and lowering our debt-to-capital ratio to 12%. Our strong financial performance also allowed us to continue returning funds to shareholders. Through the first nine months of 2024, we returned $1 billion to shareholders through share repurchases and dividends. This is an increase of $200 million, or 25%, from last year in terms of funds allocated back to our investors. I think these numbers are all the more impressive given the fluctuating macro backdrop that we've all been working through. Over the course of the year, we've seen the 30-year mortgage rates climb from 6.75% in January, 7.5% in April, only to fall back to 6% in September, And then, of course, a recent climb in interest rates back to 6.75% has the 30-year mortgage rate back to where we started 2024. We track consumer sentiment among visitors to our website and our communities, and as you might expect, buyer confidence ebbs and flows with meaningful changes or even just volatility in interest rates. This again proved to be the case as buyers reacted to the movement in rates during the third quarter. With mortgage rates hovering around 6.5% to begin the third quarter, buyers were generally less inclined to sign a purchase agreement. As interest rates declined through August and September, however, we experienced a noticeable pickup in overall activity. In fact, of the three months in the quarter, we generated the highest net new orders and absorption paces in the month of September. Driven by September's strong performance, The Q3 absorption pace of 2.4 orders per community per month was certainly above the typical pre-COVID numbers for the third quarter. The recent October has shown the highest web traffic, foot traffic, and lead volume of the year. However, the recent rise in interest rates has demonstrated a more typical seasonal selling pattern, and incentives have remained elevated as a consequence. Between rate volatility, the impact of hurricanes, and the upcoming presidential election, I think the upcoming spring selling season will offer the best assessment of fundamental housing demand. I think buyer reaction to the movement in rates, both down and now up, again, affirms that affordability remains a tough hurdle to get over for many potential homebuyers. The most recent S&P Case-Shiller Index shows home prices continue to hit all-time new highs although the rate of appreciation has slowed, which in combination with expected lower mortgage rates could offer some relief to consumers going forward. As has been discussed extensively over the past few years, one of the pressure points that continue to push home prices higher is the fact that after years of underbuilding, this country has a housing deficit estimated at several million homes. The Mortgage Bankers Association issued a useful graphic a few weeks ago that are shown on slide 15 in today's webcast slides. The graph shows housing stock added by decades since the 1940s. Looking at the graph, you can clearly see the significant drop in production during the past 15 years. To make this point even clearer, we modified the MBA graph by overlaying the growth in U.S. population over the decades. What you see is that just since the 1960s, our country's population has almost while housing production has been flat to down over the decades. Given the high cost of homeownership, rate buy downs remain a powerful incentive in helping consumers bridge the affordability gap. In the third quarter, approximately 30% of our homebuyers accessed our national rate program. To take advantage of our national rate incentive, homebuyers will typically need to close within 30 to 60 days of signing the contract, so it's important that we continue to have an inventory At the end of the third quarter, 43% of the homes in production were specs, so we are well positioned to meet demand as we close out 2024. Along with benefiting from having inventory available, we are also continuing to make progress in lowering our cycle times. For homes delivered in the third quarter, our average cycle time was 114 days, down from 123 days in this year's second quarter. Cutting two weeks out of our production timeline is an important accomplishment, and it keeps us on track to reach our goal of 110 days by year end and be at 100 days in the first part of 2025. In truth, most of our divisions are already operating at or close to our 100-day ideal target. Our reported average is higher due to a handful of divisions, primarily those with large multifamily business. Our cycle times remain elevated. In summary, operationally and financially, we accomplished a lot in the third quarter and are well positioned to have 2024 be a record year for PulteCrew. Now let me turn the call over to Bob for a review of our third quarter results.