Forestar Group Inc. (NYSE: FOR) today reported second quarter 2014 net income of approximately $14.8 million, or $0.34 per diluted share outstanding, compared with second quarter 2013 net income of approximately $0.5 million, or $0.02 per diluted share outstanding.
“During second quarter, residential lot sales remained strong and we are developing lots commensurate with inventories and home buyer demand. Multifamily market conditions remain favorable in our target markets, and we continue to acquire sites in 'A' locations to grow our business. In addition, oil and gas working interest production grew significantly, driven principally by new wells in the Bakken/Three Forks generating strong initial production. We are on track to deliver our Growing FORward strategic initiatives, which are focused on increasing total segment earnings, return on assets and opportunistically selling non-core assets. Our balance sheet strength, improving cash flows and significant liquidity are expected to adequately fund these initiatives,” said Jim DeCosmo, president and chief executive officer of Forestar Group.
Second Quarter 2014 Significant Highlights
- Sold 537 developed residential lots, up nearly 50% compared with second quarter 2013
- Converted over 10,000 acres of timber leases into ownership of 5,400 acres of undeveloped land from Ironstob venture, resulting in a $10.5 million gain
- Increased working interest oil production over 65% compared with second quarter 2013, with 31 new gross wells generating initial production
- Sold interest in 97 gross (6 net) non-core producing oil and gas wells in Oklahoma for a gain of $4.5 million and sold leasehold interests in 223 net mineral acres in North Dakota for a gain of $1.2 million
Forestar manages its operations through three business segments: real estate, oil and gas and other natural resources.REAL ESTATE Second Quarter 2014 Significant Highlights (Includes Ventures)
- Sold 537 developed residential lots at almost $64,100 per lot; highest quarterly average lot price since 2009
- Sold 79 acres of residential tracts for $63,700 per acre
- Sold over 3,200 acres of undeveloped land for nearly $7.9 million
- Converted over 10,000 acres of timber leases into ownership of 5,400 acres of undeveloped land from Ironstob venture
Segment Financial Results:
|($ in millions)||2Q 2014||2Q 2013||1Q 2014|