Deutsche Bank Global Industrials and Basic Materials Conference June 14, 2012

Transcription

1 Deutsche Bank Global Industrials and Basic Materials Conference June 14,

2 Statement Of Forward-looking Information Certain information included in this presentation is forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, information related to: anticipated operating results; anticipated financial performance, resources and condition; selling communities; home deliveries; average home prices; consumer demand and confidence; contract pricing; business and investment opportunities; and market and industry trends. Such forward-looking information involves important risks and uncertainties that could significantly affect actual results and cause them to differ materially from expectations expressed herein and in other Company reports, SEC filings, statements and presentations. These risks and uncertainties include, among others: local, regional, national and international economic conditions; fluctuating consumer demand and confidence; interest and unemployment rates; changes in sales conditions, including home prices, in the markets where we build homes; conditions in our newly entered markets and newly acquired operations; the competitive environment in which we operate; the availability and cost of land for future growth; conditions that could result in inventory write-downs or write-downs associated with investments in unconsolidated entities; the ability to recover our deferred tax assets; the availability of capital; uncertainties in the capital and securities markets; liquidity in the credit markets; changes in tax laws and their interpretation; effects of governmental legislation and regulation; the outcome of various legal proceedings; the availability of adequate insurance at reasonable cost; the impact of construction defect, product liability and home warranty claims, including the adequacy of self-insurance accruals, and the applicability and sufficiency of our insurance coverage; the ability of customers to obtain financing for the purchase of homes; the ability of home buyers to sell their existing homes; the ability of the participants in various joint ventures to honor their commitments; the availability and cost of labor and building and construction materials; the cost of raw materials; construction delays; domestic and international political events; and weather conditions. For a more detailed discussion of these factors, see the information under the captions Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations in our most recent annual report on Form 10-K and our subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. Any or all of the forward-looking statements included in this presentation are not guarantees of future performance and may turn out to be inaccurate. Forward-looking statements speak only as of the date they are made. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. 2

3 Overview Founded in 1967 NYSE since 1986 Nation s leading luxury home builder 3rd largest* U.S. homebuilder by market cap $1.5 billion in homebuilding revenues and 2,611 home deliveries in FY 2011 Builds in 20 states and approximately 50 markets Serves urban and suburban, luxury move-up, emptynester, and active-adult buyers Strong balance sheet and excellent credit ratings Insider Director ownership of approx.14% at FYE 2011 Only brand name in luxury market *As of 4/30/12 3

4 FOCUS ON LUXURY Only national builder focused on luxury market Solid demographics supports niche Qualified buyers ease mortgage concerns Main competitors are small local or regional private builders 4

5 Brand Name Reputation In Luxury Market Honored to have won the three most coveted awards in the home building industry The only brand name in the luxury market Goal is to expand brand in markets where we are already well-established Grow brand name in urban and in-fill opportunities, high-rise, second home, active adult and suburban high-density markets National Builder of the Year America s Best Builder National Housing Quality Award 5

6 Only National Homebuilder Focused On Luxury Market Toll s main competitors are small private builders. *Updated based on most recent reported fiscal year end deliveries as of December 31,

7 Toll Home Sale Prices YTD FY % Under 700,000 Numbers may not add due to rounding 7

8 Focus on Land One of the largest land developers in the U.S. Operates in most difficult approval markets in the country Skilled in land acquisition, approvals, and development across all markets Manages all site design and land improvements 8

9 Nationwide Footprint Positions Us For Growth Seattle Minneapolis Sacramento San Francisco San Jose Reno Las Vegas Los Angeles Palm Springs San Diego Phoenix Denver Dallas Detroit Boston Chicago New York Hartford Philadelphia Princeton Washington Wilmington DC Charlotte Raleigh Hilton Head Austin Houston Jacksonville 20 States 50 Markets San Antonio Orlando Sarasota Jupiter West Palm Beach Ft. Myers Naples Miami REGIONS North Mid-Atlantic South West 9

10 Building On A Solid Land Position Lots Owned and Controlled 10

11 Focus on Diversification and Customization Toll s luxury systems developed over 40 years Widest product offerings in industry High volume production with extensive customization Buyers choose from hundreds of structural and designer options In FY 2011 the average buyer added over $100,000 in options and premiums Provides competitive advantage vs. small builders Toll Architecture systemizes high volume home production 11

12 The Widest Variety Of Homes In The Industry Move-up Empty-Nester Active Adult Second Home Urban-Infill Urban Redevelopment Golf Course & Country Club High-Rise Suburban High-Density 12

13 Evolving Product Diversification (by unit deliveries) 13

14 Urban Infill

15 Focus On Financials Fiscal Q2 Results % Change Revenues $373.7 mil $319.7 mil 17% Net Contracts $754.7 mil $500.9 mil 51% Backlog $1.5 bil $1.0 bil 49% Net Income $16.9 mil ($20.8 mil) Cash* $927.0 mil Net to Debt Cap** 26.9% * Including Marketable Securities **Calculated as total debt minus mortgage warehouse loans minus cash and marketable securities divided by total debt minus mortgage warehouse loans minus cash and marketable securities plus stockholders equity. 15

16 Capitalization* Toll Brothers Inc. First Huntingdon Finance Corp. Toll Brothers Finance Corp. Citi $885 Million Revolving Credit Facility Due October 2014 $125 MM Senior Notes Deutsche Bank Royal Bank of Scotland SunTrust PNC Capital One Bank of Montreal Sumitomo Mitsui Wells Fargo Comerica US Bank California Bank & Trust TOTAL $125 MM $125 MM $100 MM $90 MM $75 MM $50 MM $50 MM $50 MM $45 MM $35 MM $15 MM $885 MM Principal Coupon Maturity $59 MM 6.875% November 2012 $105 MM 5.950% September 2013 $268 MM 4.950% March 2014 $300 MM 5.150% May 2015 $400 MM 8.910% October 2017 $250 MM 6.750% November 2019 $420 MM 5.875% February 2022 Total Weighted Average $1,802 MM 6.449% 5.42 years *As of April 30,

17 Conservative Debt Maturities* $ millions *As of April 30,

18 $100,000+ Income Households Growing 4 Times Faster Than All U.S. Households (2010 Dollars) Source: U.S. Census Bureau (P60-239) 18

19 Unemployment Rates Civilian Labor Force College Graduates Source: U.S. Bureau of Labor Statistics 19

20 Housing Starts vs. Household Growth Average Annual Housing Starts 1.77 (mil) Average Annual Housing Starts 1.49 (mil) Average Annual Housing Starts 1.37 (mil) Average Annual Housing Starts 1.74 (mil) Average Annual Housing Starts.66 (mil) 2,400 Households (000) 1, Housing Starts (000) Number of Households Has Grown 75% Since Total Single and Multi- Family Housing Starts Total Households Source: U.S. Census Bureau 20

21 Why Toll Brothers? Investing in Toll is a way to invest in: A proven management team with a tremendous track record. The nation's growing number of affluent households. The nation's strong baby-boomer-driven demographic growth. A strong balance sheet. A premier land developer in a lot-constrained environment. The dominant player with few competitors in the luxury market. A homebuilder with a niche in urban and distressed real estate. 21

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