What does Legacy Housing do and what are its main business segments?

What factors drove the changes in Legacy Housing's revenue and profit?

What were the key takeaways from Legacy Housing's earnings call?

Did Legacy Housing beat or miss consensus estimates last quarter?

What is the revenue and EPS growth rate for Legacy Housing year over year?

What is the market's earnings forecast for Legacy Housing next quarter?

What were the key takeaways from Legacy Housing’s earnings call?

What is Legacy Housing's gross profit margin?

- **Revenue Surge**: 21.3% YoY product sales growth, fueled by dealer (+53.3%) and retail (+64.2%) channels.
- **Margin Resilience**: Gross margin expands to 32.4%, despite cost pressures.
- **Share Buybacks**: $5.8M repurchased in Q2, with $8.1M remaining under program.
- **Legislative Tailwind**: Housing Act could reduce build costs and stimulate community orders.
- **Regional Divide**: Texas plants outpace slower Southeast activity.
- **ASP Stability**: Retail ASP up 11.2% YoY, balanced against volume risk.


**【CEO Opening Remarks】**
- **Revenue Growth**: Product sales increased 21.3% YoY, driven by dealer activity (+53.3%) and retail sales (+64.2%). Sequentially, product sales rose 58% from Q1 2025.
- **Gross Margin**: Product gross margin improved to 32.4% (vs. 31.9% in Q2 2024), despite higher materials and labor costs.
- **Backlog Focus**: Management prioritizes building backlog to support future production, with stronger demand in Texas plants vs. slower Southeast activity.

**【CFO Financial Commentary】**
- **Net Revenue**: $6.7M increase in product sales, 10.5% rise in net revenue per unit, and $1M growth in consumer loan interest income.
- **Profitability**: Gross profit margin expanded to 32.4%, offsetting a 19.1% increase in SG&A expenses due to one-time adjustments.
- **Liquidity**: $2.6M cash on hand (vs. $1.1M at year-end), with $8.1M remaining under share repurchase program after $5.8M repurchases in Q2.

**【CEO Additional Updates】**
- **Loan Portfolio Growth**: Retail loans up $24.6M YoY, MHP loans up $20.3M, reflecting strong dealer channel demand.
- **Falcon Ranch Progress**: Phase 1 bridge construction underway, Phase 2 utilities and roads progressing for 350 lots. Management aims to start lot sales in Q4 2025.
- **Legislative Impact**: Support for Housing Act could reduce build costs and stimulate community development through HUD grants.

**【Q&A Highlights】**
- **July Momentum**: Dealer channel growth continues, but community sales remain constrained by elevated costs and renter affordability challenges.
- **Land Sales**: No material sales in Q2; management evaluates non-core land monetization opportunities.
- **SG&A Trends**: One-time adjustments caused Q2 SG&A spike; expect normalization in H2 2025.
- **ASP Dynamics**: Retail channel ASP rose 11.2% YoY, driven by higher-priced consumer sales; cautious on further price hikes to avoid volume impact.
- **Regional Split**: Texas plants outperform Southeast, where community customers face headwinds.
- **Gross Margin Outlook**: Product margin expected to hold steady at ~32%, with focus on disciplined pricing and cost control.
- **Capital Allocation**: Share buybacks remain a priority, but management evaluates lending opportunities for higher returns.


Legacy Housing Corporation (LEGH) Q2 2025 Earnings Call Transcript

- **Q1 Revenue Mix Shift**: 21.2% product sales decline offset by 23.1% net revenue per unit gain (retail vs. wholesale)
- **Gross Margin Pressure**: 29.2% vs. 33.6% YoY, but June price increase aims for 30%+ recovery
- **Texas Market Growth**: Modified MHP financing program driving 51% YoY retail loan originations
- **Bastrop Development Momentum**: Phase 1 lot sales imminent; Phase 2 infrastructure 90% complete
- **Share Buyback Potential**: $3.4M cash on hand for opportunistic repurchases

**【CEO Opening Remarks】**
- Q1 2025 product sales decreased 21.2% YoY due to lower unit volume across all channels (mobile home parks, retail, direct sales). 
- Net revenue per product sold increased 23.1% YoY, driven by higher-margin consumer sales (retail) vs. wholesale mobile home park sales.
- Gross profit margin declined to 29.2% (vs. 33.6% YoY), reflecting lower volume and mix shift.
- Key initiatives: 
  - Simplified product line (reduced floor plans/color options)
  - Modified MHP financing program for Texas market
  - Senior management reallocation to sales/marketing
  - Bastrop, TX 1,100-pad development nearing Phase 1 lot sales

**【CFO Financial Highlights】**
- Consumer loan portfolio +$20.3M YoY; MHP loans +$20.1M; dealer finance notes -$2.4M
- Other revenue decreased 59.2% YoY due to $1.1M forfeiture deposit decline
- Operating expenses increased 6.9% YoY, driven by legal ($0.6M) and loan loss provisions ($0.5M)
- Net income declined 32.1% to $10.3M; EPS -$0.43 (30.6% YoY drop)
- Book value per share +13.1% YoY to $20.87

**【CEO Market Updates】**
- Retail sales momentum: April 2025 unit sales highest in 3 years; May tracking similarly strong
- Retail loan originations up 51% YoY through April
- Texas dealers recovering post-election slowdown
- Bastrop development Phase 1 roads/utilities complete; Phase 2 water treatment plant underway
- June 2025 price increase planned to offset tariffs/material costs

**【Q&A Key Takeaways】**
- Tariffs/material costs: June price increase planned; 30%+ gross margin target
- MHP sales delays: 3 large orders pushed to Q2; Texas financing program modification gaining traction
- Capital allocation: Bastrop development, dealer additions, loan portfolio growth
- Production rates: Texas plant Q2 shipments expected to exceed Q1; Georgia plant rebuilding dealer base

Legacy Housing (LEGH)-13 May 25-2025 Q1 Earnings call transcript

- **Record Profit Growth**: 13.2% net income rise to $61.6M, fueled by strategic land sales and lending portfolio expansion.
- **Affordability Edge**: 2024 homes priced at $61K vs. $511K for site-built, capturing 47% of U.S. low-income households.
- **Lending Strength**: 11% interest income growth to $41.2M with low delinquencies and full recovery on repos.
- **Texas Expansion**: 1,100-pad Austin development nearing completion; park sales backlog strong in key markets.
- **Cash Position**: $1.1M net cash to capitalize on share buyback opportunities in 2025.

**【CEO Opening Remarks】**
- **2024 Financial Highlights**: Net income rose 13.2% to $61.6M, driven by land sales and interest income growth. Book value per share increased 13.9% to $20.40.
- **Market Position**: 47% of U.S. households earn below $75K, aligning with Legacy's affordable housing focus. 2024 average home price was $61K, up from $60K in 2023.
- **Land Sales Progress**: Sold a mobile home park in Beaumont, TX, and preparing to monetize another. 1,100-pad development near Austin nearing completion for summer sales.
- **Lending Portfolio Health**: 2024 interest revenue from MHP and retail loans grew 11% to $41.2M. Delinquencies remain low, with repos sold at 100% of principal.
- **2025 Focus**: Expand Texas park sales, Southeast dealer networks, and streamline operations. Maintaining net cash position to repurchase shares if needed.

**【CFO Financial Breakdown】**
- **Product Sales Decline**: $15.8M (10.9%) drop due to lower unit volumes, offset by 1.9% price increase. Gross margin held steady at 30.4%.
- **Interest Income Growth**: MHP and consumer loans contributed $3.8M (10.1%) rise, driven by $41.1M in new loan portfolio growth.
- **Cost Control Success**: SG&A expenses fell 4.4% to $24.4M, aided by $1.4M warranty cost reduction and $0.4M professional fee savings.
- **Non-Core Asset Monetization**: $8.9M land sale gain and $0.5M rental income offset $1.5M deposit forfeiture decline.

**【Q&A Key Takeaways】**
- **Land Strategy**: Actively monetizing non-core assets (e.g., $17.6M in MHP loans, $8.9M in TX land sales). No new land purchases in Q4.
- **Loan Portfolio Resilience**: Retail loan delinquencies stable, with repos sold at full principal. MHP loans benefit from affordable monthly payments.
- **Labor & Immigration**: No material impact from policy changes; e-verify compliance ensures workforce stability.
- **Production Outlook**: Texas plants ramping up for spring selling season. Georgia production lagging but improving with dealer pipeline growth.
- **Expense Discipline**: SG&A maintained at 2023 levels; no plans for material increases in 2025.

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