RED BANK, N.J., March 09, 2016 (GLOBE NEWSWIRE) -- Hovnanian Enterprises, Inc. (NYSE:HOV), a leading national homebuilder, reported results for its fiscal first quarter ended January 31, 2016.

RESULTS FOR THE THREE MONTH PERIOD ENDED JANUARY 31, 2016:
  • Total revenues were $575.6 million in the first quarter of fiscal 2016, an increase of 29.1% compared with $445.7 million in the first quarter of fiscal 2015. 
  • Homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, was 16.6% for the first quarter ended January 31, 2016, compared with 18.2% in last year's first quarter. 
  • For the first quarter of fiscal 2016, Adjusted EBITDA was $38.8 million compared with $21.3 million during the first quarter of 2015, an 82.5% increase. 
  • The pre-tax loss, excluding land related charges, in the first quarter of fiscal 2016 was $1.5 million compared with a pre-tax loss, excluding land related charges, of $17.5 million in the prior year's first quarter. 
  • The net loss was $16.2 million, including $11.7 million of land related charges, primarily related to land held for sale in Minnesota, a market we are exiting, or $0.11 per common share, for the first quarter of fiscal 2016, compared with a net loss of $14.4 million, including $2.2 million of land related charges, or $0.10 per common share, in the first quarter of the previous year. 
  • The dollar value of net contracts, including unconsolidated joint ventures, during the first quarter of fiscal 2016 increased 28.2% to $668.5 million compared with $521.2 million in last year's first quarter. The dollar value of consolidated net contracts increased 24.9% to $628.6 million for the three months ended January 31, 2016 compared with $503.2 million during the same quarter a year ago. 
  • In the first quarter of fiscal 2016, the number of net contracts, including unconsolidated joint ventures, increased 16.5% to 1,592 homes from 1,366 homes during the first quarter of fiscal 2015. The number of consolidated net contracts, during the first quarter of fiscal 2016, increased 16.1% to 1,531 homes compared with 1,319 homes in the prior year's first quarter.  
  • Consolidated net contracts per active selling community increased 7.6% to 7.1 net contracts per active selling community for the first quarter of fiscal 2016 compared with 6.6 net contracts per active selling community in the first quarter of fiscal 2015. Net contracts per active selling community, including unconsolidated joint ventures, increased 6.1% to 7.0 net contracts per active selling community for the quarter ended January 31, 2016 compared with 6.6 net contracts, including unconsolidated joint ventures, per active selling community in the first quarter of fiscal 2015. 
  • As of January 31, 2016, the dollar value of contract backlog, including unconsolidated joint ventures, was $1.44 billion, an increase of 49.1% compared with $965.2 million as of January 31, 2015. The dollar value of consolidated contract backlog, as of January 31, 2016, increased 39.1% to $1.29 billion compared with $925.5 million as of January 31, 2015.  
  • As of January 31, 2016, the number of homes in contract backlog, including unconsolidated joint ventures, increased 30.2% to 3,238 homes compared with 2,487 homes as of January 31, 2015. The number of homes in consolidated contract backlog, as of January 31, 2016, increased 25.6% to 3,014 homes compared with 2,399 homes as of the end of the first quarter of fiscal 2015.  
  • Consolidated deliveries were 1,422 homes in the first quarter of fiscal 2016, a 23.8% increase compared with 1,149 homes in the first quarter of fiscal 2015. For the three months ended January 31, 2016, deliveries, including unconsolidated joint ventures, increased 20.2% to 1,466 homes compared with 1,220 homes in the first quarter of the prior year. 
  • As of end of the first quarter of fiscal 2016, active selling communities, including unconsolidated joint ventures, increased 9.6% to 228 communities compared with 208 communities at January 31, 2015. As of January 31, 2016, consolidated active selling communities increased 9.0% to 217 communities compared with 199 communities at the end of the prior year's first quarter. 
  • Total interest expense as a percentage of total revenues was 6.6% during the first quarter of fiscal 2016, a decrease of 160 basis points, compared with 8.2% in the same period of the previous year. 
  • Total SG&A was $63.8 million, or 11.1% of total revenues, during the first quarter of fiscal 2016 compared with $64.6 million, or 14.5% of total revenues, in last year's first quarter. 
  • The contract cancellation rate, including unconsolidated joint ventures, for the first quarter of fiscal 2016 was 21%, compared with 18% in the first quarter of fiscal 2015. 
  • The valuation allowance was $635.3 million as of January 31, 2016. The valuation allowance is a non-cash reserve against the tax assets for GAAP purposes. For tax purposes, the tax deductions associated with the tax assets may be carried forward for 20 years from the date the deductions were incurred. 
  • During February 2016, the dollar value of consolidated net contracts increased 27.5% to $262.4 million compared with $205.8 million for February of 2015, and the number of consolidated net contracts increased 11.3% to 600 homes in February 2016 from 539 homes in February 2015.

LIQUIDITY AND INVENTORY AS OF JANUARY 31, 2016:
  • After paying off $233.5 million of debt that matured in October 2015 and January 2016, total liquidity at the end of the first quarter of fiscal 2016 was $152.1 million. 
  • During the first quarter of fiscal 2016, land and land development spending was $116.6 million. 
  • As of January 31, 2016, the land position, including unconsolidated joint ventures, was 38,070 lots, consisting of 18,732 lots under option and 19,338 owned lots, compared with a total of 36,767 lots as of January 31, 2015. 
  • During the first quarter of fiscal 2016, approximately 3,300 lots, including unconsolidated joint ventures, were put under option or acquired in 39 communities.

FINANCIAL GUIDANCE:
  • Assuming no changes in current market conditions, we reiterate our prior guidance that total revenues for all of fiscal 2016 are expected to be between $2.7 billion and $3.1 billion and pretax profit excluding land related charges, gains or losses on extinguishment of debt and other non-recurring items such as legal settlements are expected to be between $40 million and $100 million for all of fiscal 2016.

COMMENTS FROM MANAGEMENT/UPDATED STRATEGIC FOCUS:

"We are pleased by our strong start to the fiscal year, which was highlighted by an 83% increase in adjusted EBITDA and a 49% increase in contract backlog dollars," stated Ara K. Hovnanian, Chairman of the Board, President and Chief Executive Officer. "During our first quarter, our 29% total revenue growth resulted in a 500 basis point improvement in our total SG&A and total interest ratios in the aggregate. Rather than focusing on additional revenue growth beyond 2016, we now plan to focus on deleveraging our balance sheet and maximizing our profitability. As part of this strategy we have decided to exit the Minneapolis, MN and Raleigh, NC markets. Additionally, we plan to wind down our operations in Tampa, FL and the San Francisco Bay Area in Northern California by delivering the remaining homes in our existing communities. We are confident these decisions will lead to continued efficiencies and ultimately improved financial performance," concluded Mr. Hovnanian.

WEBCAST INFORMATION:

Hovnanian Enterprises will webcast its fiscal 2016 first quarter financial results conference call at 10:30 a.m. E.T. on Wednesday, March 9, 2016. The webcast can be accessed live through the "Investor Relations" section of Hovnanian Enterprises' website at http://www.khov.com. For those who are not available to listen to the live webcast, an archive of the broadcast will be available under the "Past Events" section of the Investor Relations page on the Hovnanian website at http://www.khov.com. The archive will be available for 12 months.

ABOUT HOVNANIAN ENTERPRISES ® , INC.:

Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation's largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, Minnesota, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and West Virginia. The Company's homes are marketed and sold under the trade names K. Hovnanian ®  Homes, Brighton Homes ®  and Parkwood Builders. As the developer of K. Hovnanian's ®  Four Seasons communities, the Company is also one of the nation's largest builders of active lifestyle communities.

Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company's 2015 annual report, can be accessed through the "Investor Relations" section of the Hovnanian Enterprises' website at http://www.khov.com. To be added to Hovnanian's investor e-mail list, please send an e-mail to IR@khov.com or sign up at http://www.khov.com.

NON-GAAP FINANCIAL MEASURES:

Consolidated earnings before interest expense and income taxes ("EBIT") and before depreciation and amortization ("EBITDA") and before inventory impairment loss and land option write-offs ("Adjusted EBITDA") are not U.S. generally accepted accounting principles (GAAP) financial measures. The most directly comparable GAAP financial measure is net loss. The reconciliation of EBIT, EBITDA and Adjusted EBITDA to net loss is presented in a table attached to this earnings release.

Loss Before Income Taxes Excluding Land-Related Charges is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Loss Before Income Taxes. The reconciliation of Loss Before Income Taxes Excluding Land-Related Charges to Loss Before Income Taxes is presented in a table attached to this earnings release.

Total liquidity is comprised of $147.1 million of cash and cash equivalents, $2.5 million of restricted cash required to collateralize letters of credit and $2.5 million of availability under the unsecured revolving credit facility as of January 31, 2016.

FORWARD-LOOKING STATEMENTS

All statements in this press release that are not historical facts should be considered as "Forward-Looking Statements" within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such forward-looking statements include but are not limited to statements related to the Company's goals and expectations with respect to its financial results for the current or future financial periods, including total revenues and adjusted pretax profits. Although we believe that our plans, intentions and expectations reflected in, or suggested by, such forward-looking statements are reasonable, we can give no assurance that such plans, intentions or expectations will be achieved. By their nature, forward-looking statements: (1) speak only as of the date they are made, (2) are not guarantees of future performance or results and (3) are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Therefore, actual results could differ materially and adversely from those forward-looking statements as a result of a variety of factors. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic, industry and business conditions and impacts of the sustained homebuilding downturn; (2) adverse weather and other environmental conditions and natural disasters; (3) levels of indebtedness and restrictions on the Company's operations and activities imposed by the agreements governing the Company's outstanding indebtedness; (4) the Company's sources of liquidity; (5) changes in credit ratings; (6) changes in market conditions and seasonality of the Company's business; (7) the availability and cost of suitable land and improved lots; (8) shortages in, and price fluctuations of, raw materials and labor; (9) regional and local economic factors, including dependency on certain sectors of the economy, and employment levels affecting home prices and sales activity in the markets where the Company builds homes; (10) fluctuations in interest rates and the availability of mortgage financing; (11) changes in tax laws affecting the after-tax costs of owning a home; (12) operations through joint ventures with third parties; (13) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, tax laws and the environment; (14) product liability litigation, warranty claims and claims made by mortgage investors; (15) levels of competition; (16) availability and terms of financing to the Company; (17) successful identification and integration of acquisitions; (18) significant influence of the Company's controlling stockholders; (19) availability of net operating loss carryforwards; (20) utility shortages and outages or rate fluctuations; (21) geopolitical risks, terrorist acts and other acts of war; (22) increases in cancellations of agreements of sale; (23) loss of key management personnel or failure to attract qualified personnel; (24) information technology failures and data security breaches; (25) legal claims brought against us and not resolved in our favor; and (26) certain risks, uncertainties and other factors described in detail in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2015 and subsequent filings with the Securities and Exchange Commission. Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

(Financial Tables Follow)
Hovnanian Enterprises, Inc.        
January 31, 2016        
Statements of Consolidated Operations        
(Dollars in Thousands, Except Per Share Data)        
    Three Months Ended  
    January 31,  
      2016       2015    
    (Unaudited)  
Total Revenues $ 575,605     $ 445,714    
Costs and Expenses (a)   587,319       466,846    
(Loss) Income from Unconsolidated Joint Ventures   (1,480 )     1,452    
Loss Before Income Taxes   (13,194 )     (19,680 )  
Income Tax Provision (Benefit)   2,979       (5,304 )  
Net Loss $ (16,173 )   $ (14,376 )  
           
Per Share Data:        
Basic:          
Loss Per Common Share $ (0.11 )   $ (0.10 )  
Weighted Average Number of        
Common Shares Outstanding (b)   147,139       146,929    
Assuming Dilution:        
Loss Per Common Share $ (0.11 )   $ (0.10 )  
Weighted Average Number of        
Common Shares Outstanding (b)   147,139       146,929    
           
(a)  Includes inventory impairment loss and land option write-offs.  
(b)  For periods with a net loss, basic shares are used in accordance with GAAP rules.  
           
           
Hovnanian Enterprises, Inc.        
January 31, 2016        
Reconciliation of Loss Before Income Taxes Excluding Land-Related Charges to Loss Before Income Taxes  
           
(Dollars in Thousands)        
           
    Three Months Ended  
    January 31,  
      2016       2015    
    (Unaudited)  
Loss Before Income Taxes $ (13,194 )   $ (19,680 )  
Inventory Impairment Loss and Land Option Write-Offs   11,681       2,230    
Loss Before Income Taxes Excluding Land-Related Charges(a) $ (1,513 )   $ (17,450 )  
           
(a) Loss Before Income Taxes Excluding Land-Related Charges is a non-GAAP Financial measure. The most directly comparable GAAP financial measure is Loss Before Income Taxes.

                                                                   
Hovnanian Enterprises, Inc.          
January 31, 2016          
Gross Margin          
(Dollars in Thousands)          
    Homebuilding Gross Margin  
    Three Months Ended  
    January 31,  
      2016       2015    
    (Unaudited)  
Sale of Homes   $ 556,775     $ 433,471    
Cost of Sales, Excluding Interest and Land Charges (a)       464,146       354,379    
Homebuilding Gross Margin, Excluding Interest and Land Charges     92,629         79,092    
Homebuilding Cost of Sales Interest      16,843         11,299    
Homebuilding Gross Margin, Including Interest and Excluding Land Charges   $ 75,786     $ 67,793    
           
Gross Margin Percentage, Excluding Interest and Land Charges     16.6 %     18.2 %  
Gross Margin Percentage, Including Interest and Excluding Land Charges     13.6 %     15.6 %  
           
    Land Sales Gross Margin  
    Three Months Ended  
    January 31,  
      2016       2015    
    (Unaudited)  
Land and Lot Sales    $ -     $ 514    
Cost of Sales, Excluding Interest and Land Charges (a)       -       433    
Land and Lot Sales Gross Margin, Excluding Interest and Land Charges     -       81    
Land and Lot Sales Interest       -       19    
Land and Lot Sales Gross Margin, Including Interest and Excluding Land Charges    $ -     $ 62    
           
(a) Does not include cost associated with walking away from land options or inventory impairment losses which are recorded as Inventory impairment loss and land option write-offs in the Condensed Consolidated Statements of Operations.

Hovnanian Enterprises, Inc.      
January 31, 2016      
Reconciliation of Adjusted EBITDA to Net Loss      
(Dollars in Thousands)      
  Three Months Ended
  January 31,
    2016       2015  
  (Unaudited)
Net Loss $ (16,173 )   $ (14,376 )
Income Tax Provision (Benefit)   2,979       (5,304 )
Interest Expense   38,068       36,389  
EBIT (a)   24,874       16,709  
Depreciation   865       849  
Amortization of Debt Costs   1,383       1,472  
EBITDA (b)   27,122       19,030  
Inventory Impairment Loss and Land Option Write-offs   11,681       2,230  
Adjusted EBITDA (c) $ 38,803     $ 21,260  
       
Interest Incurred $ 41,959     $ 41,472  
       
Adjusted EBITDA to Interest Incurred   0.92       0.51  
       
(a) EBIT is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net loss. EBIT represents earnings before interest expense and income taxes.
(b) EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net loss. EBITDA represents earnings before interest expense, income taxes, depreciation and amortization.
(c) Adjusted EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net loss. Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation, amortization and inventory impairment loss and land option write-offs.
       
       
Hovnanian Enterprises, Inc.      
January 31, 2016      
Interest Incurred, Expensed and Capitalized      
(Dollars in Thousands)      
  Three Months Ended
  January 31,
    2016       2015  
  (Unaudited)
Interest Capitalized at Beginning of Period $ 123,898     $ 109,158  
Plus Interest Incurred     41,959         41,472  
Less Interest Expensed   38,068       36,389  
Less Interest Contributed to Unconsolidated Joint Venture (a)   10,676       -  
Interest Capitalized at End of Period (b) $ 117,113     $ 114,241  
       
(a) Represents capitalized interest which was included as part of the assets contributed to the joint venture the Company entered into in November 2015. There was no impact to the Condensed Consolidated Statement of Operations as a result of this transaction.
(b) Capitalized interest amounts are shown gross before allocating any portion of impairments to capitalized interest.

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES  
CONDENSED CONSOLIDATED BALANCE SHEETS  
(In Thousands)  
   
    January 31, 2016(Unaudited)     October 31, 2015(1)  
ASSETS            
             
Homebuilding:            
Cash and cash equivalents   $ 147,124       $ 245,398    
Restricted cash and cash equivalents     6,865         7,299    
Inventories:            
Sold and unsold homes and lots under development     1,127,416         1,307,850    
Land and land options held for future development or sale     186,503         214,503    
Consolidated inventory not owned      338,067          122,225    
Total inventories     1,651,986         1,644,578    
Investments in and advances to unconsolidated joint ventures     69,094         61,209    
Receivables, deposits and notes, net     69,629         70,349    
Property, plant and equipment, net     46,010         45,534    
Prepaid expenses and other assets     81,186         77,671    
Total homebuilding     2,071,894         2,152,038    
             
Financial services:            
Cash and cash equivalents     5,454         8,347    
Restricted cash and cash equivalents     20,072         19,223    
Mortgage loans held for sale at fair value     164,961         130,320    
Other assets     2,971         2,091    
Total financial services     193,458         159,981    
Income taxes receivable - including net deferred tax benefits     287,388         290,279    
Total assets   $ 2,552,740       $ 2,602,298    
   
(1) Derived from the audited balance sheet as of October 31, 2015.  

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES  
CONDENSED CONSOLIDATED BALANCE SHEETS  
(In Thousands Except Share and Per Share Amounts)  
   
    January 31, 2016(Unaudited)     October 31, 2015(1)  
LIABILITIES AND EQUITY            
             
Homebuilding:            
Nonrecourse mortgages secured by inventory   $ 128,668       $ 143,863    
Accounts payable and other liabilities     348,400         348,516    
Customers' deposits     42,433         44,218    
Nonrecourse mortgages secured by operating properties     15,220         15,511    
Liabilities from inventory not owned     242,409         105,856    
Total homebuilding     777,130         657,964    
             
Financial services:            
Accounts payable and other liabilities     27,695         27,908    
Mortgage warehouse lines of credit     140,356         108,875    
Total financial services     168,051         136,783    
             
Notes payable:            
Revolving credit agreement     47,000         47,000    
Senior secured notes, net of discount     981,716         981,346    
Senior notes, net of discount     607,575         780,319    
Senior amortizing notes     10,516         12,811    
Senior exchangeable notes     74,720         73,771    
Accrued interest     29,172         40,388    
Total notes payable     1,750,699         1,935,635    
Total liabilities     2,695,880         2,730,382    
             
Stockholders' equity deficit:            
Preferred stock, $0.01 par value - authorized 100,000 shares; issued and outstanding 5,600 shares with a liquidation preference of $140,000 at January 31, 2016 and at October 31, 2015     135,299         135,299    
Common stock, Class A, $0.01 par value - authorized 400,000,000 shares; issued 143,562,913 shares at January 31, 2016 and 143,292,881 shares at October 31, 2015 (including 11,760,763 shares at January 31, 2016 and October 31, 2015 held in treasury)     1,436         1,433    
Common stock, Class B, $0.01 par value (convertible to Class A at time of sale) - authorized 60,000,000 shares; issued 16,009,727 shares at January 31, 2016 and 15,676,829 shares at October 31, 2015 (including 691,748 shares at January 31, 2016 and October 31, 2015 held in treasury)     160         157    
Paid in capital - common stock     704,862         703,751    
Accumulated deficit     (869,537 )       (853,364 )  
Treasury stock - at cost     (115,360 )       (115,360 )  
Total stockholders' equity deficit     (143,140 )       (128,084 )  
Total liabilities and equity   $ 2,552,740       $ 2,602,298    
   
(1) Derived from the audited balance sheet as of October 31, 2015.  

 
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Share and Per Share Data)
(Unaudited)
 
    Three Months Ended January 31,
      2016         2015  
Revenues:          
Homebuilding:          
Sale of homes   $ 556,775       $ 433,471  
Land sales and other revenues     604         1,121  
Total homebuilding     557,379         434,592  
Financial services     18,226         11,122  
Total revenues     575,605         445,714  
           
Expenses:          
Homebuilding:          
Cost of sales, excluding interest     464,146         354,812  
Cost of sales interest     16,843         11,318  
Inventory impairment loss and land option write-offs     11,681         2,230  
Total cost of sales     492,670         368,360  
Selling, general and administrative     47,504         47,646  
Total homebuilding expenses     540,174         416,006  
           
Financial services     8,215         7,317  
Corporate general and administrative     16,321         16,908  
Other interest     21,225         25,071  
Other operations     1,384         1,544  
Total expenses     587,319         466,846  
(Loss) income from unconsolidated joint ventures     (1,480 )       1,452  
Loss before income taxes     (13,194 )       (19,680 )
State and federal income tax provision (benefit):          
State     4,319         3,132  
Federal     (1,340 )       (8,436 )
Total income taxes     2,979         (5,304 )
Net loss   $ (16,173 )     $ (14,376 )
           
Per share data:          
Basic:          
Loss per common share   $ (0.11 )     $ (0.10 )
Weighted-average number of common shares outstanding     147,139         146,929  
Assuming dilution:          
Loss per common share   $ (0.11 )     $ (0.10 )
Weighted-average number of common shares outstanding     147,139         146,929  

HOVNANIAN ENTERPRISES, INC.    
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(SEGMENT DATA EXCLUDES UNCONSOLIDATED JOINT VENTURES)   Communities Under Development Three Months - January 31, 2016      
(UNAUDITED)              
    Net Contracts Deliveries Contract
    Three Months Ended Three Months Ended Backlog
    Jan 31, Jan 31, Jan 31,
      2016     2015   % Change   2016     2015   % Change   2016     2015   % Change
Northeast                    
(NJ, PA) Home   92     107     (14.0 )%   151     96     57.3 %   234     157     49.0 %
  Dollars $ 39,784   $ 56,753     (29.9 )% $ 72,438   $ 50,642     43.0 % $ 114,350   $ 79,438     43.9 %
  Avg. Price $ 432,432   $ 530,402     (18.5 )% $ 479,721   $ 527,521     (9.1 )% $ 488,673   $ 505,973     (3.4 )%
Mid-Atlantic                    
(DE, MD, VA, WV) Home   260     211     23.2 %   206     191     7.9 %   507     391     29.7 %
  Dollars $ 130,316   $ 102,109     27.6 % $ 93,552   $ 80,911     15.6 % $ 275,863   $ 210,121     31.3 %
  Avg. Price $ 501,215   $ 483,931     3.6 % $ 454,136   $ 423,620     7.2 % $ 544,108   $ 537,394     1.2 %
Midwest                     
(IL, MN, OH) Home   207     208     (0.5 )%   274     203     35.0 %   577     670     (13.9 )%
  Dollars $ 67,569   $ 70,981     (4.8 )% $ 91,840   $ 64,410     42.6 % $ 170,020   $ 195,167     (12.9 )%
  Avg. Price $ 326,420   $ 341,257     (4.3 )% $ 335,181   $ 317,290     5.6 % $ 294,662   $ 291,294     1.2 %
Southeast                    
(FL, GA, NC, SC) Home   213     173     23.1 %   116     121     (4.1 )%   376     284     32.4 %
  Dollars $ 90,259   $ 52,290     72.6 % $ 39,194   $ 37,784     3.7 % $ 157,001   $ 95,577     64.3 %
  Avg. Price $ 423,754   $ 302,257     40.2 % $ 337,884   $ 312,264     8.2 % $ 417,556   $ 336,539     24.1 %
Southwest                    
(AZ, TX) Home   560     538     4.1 %   550     477     15.3 %   1,043     831     25.5 %
  Dollars $ 208,642   $ 193,584     7.8 % $ 204,189   $ 166,609     22.6 % $ 427,164   $ 322,294     32.5 %
  Avg. Price $ 372,575   $ 359,822     3.5 % $ 371,253   $ 349,286     6.3 % $ 409,553   $ 387,839     5.6 %
West                     
(CA) Home   199     82     142.7 %   125     61     104.9 %   277     66     319.7 %
  Dollars $ 92,073   $ 27,440     235.5 % $ 55,562   $ 33,115     67.8 % $ 143,396   $ 22,936     525.2 %
  Avg. Price $ 462,676   $ 334,629     38.3 % $ 444,494   $ 542,866     (18.1 )% $ 517,677   $ 347,520     49.0 %
Consolidated Total                    
  Home   1,531     1,319     16.1 %   1,422     1,149     23.8 %   3,014     2,399     25.6 %
  Dollars $ 628,643   $ 503,157     24.9 % $ 556,775   $ 433,471     28.4 % $ 1,287,794   $ 925,533     39.1 %
  Avg. Price $ 410,610   $ 381,469     7.6 % $ 391,543   $ 377,259     3.8 % $ 427,271   $ 385,800     10.7 %
Unconsolidated Joint Ventures                    
  Home   61     47     29.8 %   44     71     (38.0 )%   224     88     154.5 %
  Dollars $ 39,821   $ 18,081     120.2 % $ 20,187   $ 27,578     (26.8 )% $ 151,716   $ 39,626     282.9 %
  Avg. Price $ 652,803   $ 384,707     69.7 % $ 458,795   $ 388,421     18.1 % $ 677,304   $ 450,292     50.4 %
Grand Total                    
  Home   1,592     1,366     16.5 %   1,466     1,220     20.2 %   3,238     2,487     30.2 %
  Dollars $ 668,464   $ 521,238     28.2 % $ 576,962   $ 461,049     25.1 % $ 1,439,510   $ 965,159     49.1 %
  Avg. Price $ 419,889   $ 381,580     10.0 % $ 393,562   $ 377,909     4.1 % $ 444,568   $ 388,082     14.6 %
                     
DELIVERIES INCLUDE EXTRAS                    
Notes:                    
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts. 

HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(SEGMENT DATA INCLUDES UNCONSOLIDATED JOINT VENTURES)   Communities Under Development        
(UNAUDITED)         Three Months - January 31, 2016        
    Net Contracts Deliveries Contract
    Three Months Ended Three Months Ended Backlog
    Jan 31, Jan 31, Jan 31,
      2016     2015   % Change   2016     2015   % Change   2016     2015   % Change
Northeast                    
(includes unconsolidated joint ventures) Home   87     108     (19.4 )%   159     108     47.2 %   269     166     62.0 %
(NJ, PA) Dollars $ 35,494   $ 54,601     (35.0 )% $ 74,694   $ 54,100     38.1 % $ 129,276   $ 82,082     57.5 %
  Avg. Price $ 407,974   $ 505,568     (19.3 )% $ 469,773   $ 500,924     (6.2 )% $ 480,580   $ 494,469     (2.8 )%
Mid-Atlantic                    
(includes unconsolidated joint ventures) Home   273     228     19.7 %   216     210     2.9 %   524     424     23.6 %
(DE, MD, VA, WV) Dollars $ 136,738   $ 111,562     22.6 % $ 99,219   $ 91,498     8.4 % $ 284,425   $ 230,025     23.6 %
  Avg. Price $ 500,874   $ 489,307     2.4 % $ 459,347   $ 435,704     5.4 % $ 542,796   $ 542,512     0.1 %
Midwest                     
(includes unconsolidated joint ventures) Home   207     208     (0.5 )%   274     214     28.0 %   577     676     (14.6 )%
(IL, MN, OH) Dollars $ 67,569   $ 71,234     (5.1 )% $ 91,840   $ 67,337     36.4 % $ 170,020   $ 197,158     (13.8 )%
  Avg. Price $ 326,420   $ 342,471     (4.7 )% $ 335,181   $ 314,658     6.5 % $ 294,662   $ 291,653     1.0 %
Southeast                    
(includes unconsolidated joint ventures) Home   220     189     16.4 %   117     141     (17.0 )%   391     309     26.5 %
(FL, GA, NC, SC) Dollars $ 95,086   $ 58,794     61.7 % $ 39,580   $ 45,834     (13.6 )% $ 166,366   $ 105,952     57.0 %
  Avg. Price $ 432,210   $ 311,080     38.9 % $ 338,287   $ 325,067     4.1 % $ 425,490   $ 342,887     24.1 %
Southwest                    
(includes unconsolidated joint ventures) Home   560     538     4.1 %   550     477     15.3 %   1,043     831     25.5 %
(AZ, TX) Dollars $ 208,642   $ 193,584     7.8 % $ 204,189   $ 166,609     22.6 % $ 427,164   $ 322,294     32.5 %
  Avg. Price $ 372,575   $ 359,822     3.5 % $ 371,253   $ 349,286     6.3 % $ 409,553   $ 387,839     5.6 %
West                     
(includes unconsolidated joint ventures) Home   245     95     157.9 %   150     70     114.3 %   434     81     435.8 %
(CA) Dollars $ 124,935   $ 31,463     297.1 % $ 67,440   $ 35,671     89.1 % $ 262,259   $ 27,648     848.6 %
  Avg. Price $ 509,937   $ 331,187     54.0 % $ 449,597   $ 509,591     (11.8 )% $ 604,284   $ 341,336     77.0 %
Grand Total                    
  Home   1,592     1,366     16.5 %   1,466     1,220     20.2 %   3,238     2,487     30.2 %
  Dollars $ 668,464   $ 521,238     28.2 % $ 576,962   $ 461,049     25.1 % $ 1,439,510   $ 965,159     49.1 %
  Avg. Price $ 419,889   $ 381,580     10.0 % $ 393,562   $ 377,909     4.1 % $ 444,568   $ 388,082     14.6 %
Consolidated Total                    
  Home   1,531     1,319     16.1 %   1,422     1,149     23.8 %   3,014     2,399     25.6 %
  Dollars $ 628,643   $ 503,157     24.9 % $ 556,775   $ 433,471     28.4 % $ 1,287,794   $ 925,533     39.1 %
  Avg. Price $ 410,610   $ 381,469     7.6 % $ 391,543   $ 377,259     3.8 % $ 427,271   $ 385,800     10.7 %
Unconsolidated Joint Ventures                    
  Home   61     47     29.8 %   44     71     (38.0 )%   224     88     154.5 %
  Dollars $ 39,821   $ 18,081     120.2 % $ 20,187   $ 27,578     (26.8 )% $ 151,716   $ 39,626     282.9 %
  Avg. Price $ 652,803   $ 384,707     69.7 % $ 458,795   $ 388,421     18.1 % $ 677,304   $ 450,292     50.4 %
                     
DELIVERIES INCLUDE EXTRAS  
Notes:                      
(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts. 

Contact:J. Larry SorsbyExecutive Vice President & CFO732-747-7800Jeffrey T. O'KeefeVice President, Investor Relations732-747-7800

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