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D.R. Horton Inc (DHI) Q1 2021 Earnings Call Transcript

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DHI earnings call for the period ending January 26, 2021.

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D.R. Horton Inc (DHI 1.73%)
Q1 2021 Earnings Call
Jan 26, 2021, 8:30 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Good morning and welcome to the First Quarter 2021 Earnings Conference Call for D.R. Horton, America's Builder, the largest builder in the United States. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded.

I will now turn the call over to Jessica Hansen, Vice President of Investor Relations for D.R. Horton.

Jessica Hansen -- Vice President of Investor Relations and Communications

Thank you, Christine, and good morning. Welcome to our call to discuss our results for the first quarter of fiscal 2021. Before we get started, today's call may include comments that constitute forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Although D.R. Horton believes any such statements are based on reasonable assumptions, there is no assurance that actual outcomes will not be materially different. All forward-looking statements are based upon information available to D.R. Horton on the date of this conference call and D.R. Horton does not undertake any obligation to publicly update or revise any forward-looking statements. Additional information about issues that could lead to material changes in performance is contained in D.R. Horton's annual report on Form 10-K, which is filed with the Securities and Exchange Commission.

This morning's earnings release can be found on our website at investor.drhorton.com and we plan to file our 10-Q in the next day or two. After this call, we will post updated investor and supplementary data presentations to our Investor Relations site on the Presentation section under News and Events for your reference.

Now, I will turn the call over to David Auld, our President and CEO.

David V. Auld -- President and Chief Executive Officer

Thank you, Jessica, and good morning. I'm pleased to also be joined on this call by Mike Murray, our Executive Vice President and Chief Operating Officer and Bill Wheat, our Executive Vice President and Chief Financial Officer.

The D.R. Horton team delivered an outstanding first quarter, which included a 98% increase in consolidated pre-tax income to over $1 billion, a 48% increase in revenues to $5.9 billion and a 56% increase in net sales orders 20,418. The pre-tax profit margin for the quarter improved 440 basis points to 17.4% while our earnings increased 84% to $2.14 per diluted share. Our homebuilding return on inventory for the trailing 12 months ended December 31st was 28% and our consolidated return on equity for the same period was 44.4%. These results reflect the strength of our homebuilding and financial services teams, our ability to deliver D.R. Horton's scale across our broad geographic footprint and our product positioning to offer homes at affordable price points across multiple brands.

Housing market conditions remain very strong and our teams are focused on maximizing returns and improving capital efficiency in each of our communities, while increasing our market share. However, we remain cautious regarding the impact of COVID-19 pandemic or other external factors may have on the economy and our operations in the future. We believe our strong balance sheet, liquidity, and experienced teams position us very well to operate effectively through changing economic conditions. We plan to maintain our flexible operational and financial position by generating strong cash flows from our homebuilding operations and managing our product offerings, incentives, home prices, sales pace and inventory levels to optimize return on our inventory investments with 42,100 homes in inventory an ample supply of lots and continued strong sales trends in January. We are well positioned for the spring selling season and the remainder of 2021. Mike?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Earnings for the first quarter of fiscal 2021 increased 84% to $2.14 per diluted share compared to $1.16 per share in the prior year quarter. Net income for the quarter increased 84% to $792 million compared to $431 million. Our first quarter home sales revenues increased 48% to $5.7 billion on 18,739 homes closed up from $3.9 billion on 12,959 homes closed in the prior year.

Our average closing price for the quarter was up 2% from the prior year at $304,100 and the average size of our homes closed was down 2%, reflecting our ongoing efforts to keep our homes affordable. Bill?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Net sales orders in the first quarter increased 56% to 20,418 homes and the value of those orders was $6.4 billion, up 62% from $3.9 billion in the prior year. We sold 7,292 more homes this quarter than the same quarter last year, supporting our plan to achieve further gains in market share and scale during fiscal 2021. Our average number of active selling communities increased 3% from the prior year quarter and was up 1% sequentially. Our average sales price on net sales orders in the first quarter was $314,200, up 4% from the prior year. The cancellation rate for the first quarter was 18%, down from 20% in the prior year quarter.

We are pleased with our sales pace to date in January and have seen the volume improvement we expect, as we head into the spring selling season. We remain well positioned for increased demand with our affordable product offerings, lot supply and housing inventories. Jessica?

Jessica Hansen -- Vice President of Investor Relations and Communications

Our gross profit margin on home sales revenue in the first quarter was 24.1%, up 140 basis points sequentially from the September quarter and up 310 basis points compared to the prior year quarter. The sequential increase in our gross margin from September to December exceeded our expectations and reflects the broad strength of the housing market across on this all of our markets. We continue to see very strong demand and a limited supply of homes, especially at affordable price points and we still have pricing power and are currently using very few sales incentives. On a per square foot basis, our revenues were up 4% from the prior year quarter, while our stick-and-brick cost per square foot was down 1.5% and our lot cost per square foot was up 4%. Sequentially, our revenues were flat on a per square foot basis, while our stick-and-brick cost per square foot decreased 1.5% and our lot cost decreased 1.5%. Although we didn't see the impact of rising costs in our December quarter, we do expect both our construction and lot costs will increase on a per square foot basis in our homes closed next quarter. With the strength of today's market conditions, we expect to offset these cost pressures with price increases and currently expect our home sales gross margin in the second quarter to be similar to the first quarter.

We remain focused on managing the pricing incentives and sales pace in each of our communities to optimize the return on our inventory investments and adjust to local market conditions and new home demand. Bill?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

In the first quarter, homebuilding SG&A expense as a percentage of revenues was 7.9%, down 130 basis points from 9.2% in the prior year quarter. The improvement in our SG&A ratio this quarter was better than our expectations and was due to strong leverage, driven by our higher than expected volume of homes closed, and the increase in our average selling price. Our homebuilding SG&A expense as a percentage of revenues is at its lowest point for our first quarter in our history and we remain focused on controlling our SG&A, while ensuring that our infrastructure appropriately supports our business. Mike?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

We ended the first quarter with 42,100 homes in inventory; 16,300 of our total homes were unsold, of which 1,600 were completed. We also had 1,900 model homes at the end of the quarter. Due to our strong sales in the second half of fiscal 2020 and the first quarter of fiscal 2021, our level of unsold and completed unsold homes is lower than in recent years. We have accelerated our pace of home starts across most of our communities in the past few quarters to ensure we maintain an adequate number of homes to meet demand. During the first quarter, we started 22,800 homes. We have made good progress, increasing our homes in inventory and we expect to increase them further in the second quarter, as we enter the spring selling season. At December 31st, our homebuilding lot position consisted of approximately 441,000 lots, of which 28% were owned and 72% were controlled through purchase contracts, 30% of our total owned lots are finished and at least 47% of our controlled lots are or will be finished when we purchase them. Our growing and capital efficient lot portfolio continues to provide us a strong competitive position, allowing us to start construction on more homes to meet homebuyer demand. David?

David V. Auld -- President and Chief Executive Officer

The first quarter of homebuilding investments in lots, land and development totaled $1.95 billion, of which $1.13 billion was for finished lots, $490 million was for land development and $330 million was to acquire land, $290 million of our lot purchases in the first quarter were from Forestar. Bill?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Forestar, our majority-owned subsidiary, is a publicly traded residential lot manufacturer operating in 51 markets across 21 states. Our strategic relationship with Forestar as a well-capitalized lot supplier across much of our operating footprint is serving us well and is presenting opportunities for both companies to gain market share. Forestar is delivering on its high growth expectations and now expects to grow its lot deliveries by 30% to 35% in fiscal 2021 to a range of 13,500 lots to 14,000 lots.

At December 31st, Forestar's lot position increased 74% from a year ago to 77,500 lots, of which 52,300 are owned and 25,200 are controlled through purchase contracts; 67% of Forestar's owned lots are already under contract with D.R. Horton are subject to a right of first offer under our master supply agreement. Forestar is separately capitalized from D.R. Horton and has approximately $580 million of liquidity, which includes $240 million of unrestricted cash and $340 million of available capacity on its revolving credit facility. At December 31st, Forestar's net debt to capital ratio was 31.8% and their next senior note maturity is in 2024. With low leverage, ample liquidity and its relationship with D.R. Horton, Forestar is in a very strong position to grow their business, and navigate through changing market conditions. Jessica?

Jessica Hansen -- Vice President of Investor Relations and Communications

Financial services pre-tax income in the first quarter was $84.1 million with a pre-tax profit margin of 44.9%, compared to $30.5 million and 29.6% in the prior year quarter. Our mortgage company has continued selling the mortgages that originates at strong net gains. We began retaining servicing rights on a portion of our FHA and VA loan originations in the third quarter last year, because of lower valuations offered by mortgage servicers due to the uncertainty of the impact of the CARES Act. Servicing values have since improved and we sold a portion of our retained servicing rights during the first quarter. We expect to continue retaining some servicing rights prior to selling them to third parties, typically within 6 months of loan origination. For the quarter, 97% of our mortgage can be loan originations related to homes closed by our homebuilding operations and our mortgage company handled the financing for 68% of our home buyers. FHA and VA loans accounted for 50% of the mortgage company's volume. Borrowers originating loans with DHI Mortgage this quarter had an average FICO score of 719 and an average loan to value ratio of 90%. First-time homebuyers represented 56% of the closings handled by our mortgage company, up from 50% in the prior year quarter. Mike?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

At December 31st, our multifamily rental operations had four projects under active construction and an additional four projects that are in the lease-up phase. These eight projects represent 2,325 multifamily units. Based on our pace of leasing activity, we currently expect to sell two projects during the second half of fiscal 2021. Our multifamily rental assets totaled $294.3 million at December 31st. And as we mentioned in our last call, we are constructing in leasing homes within single family rental communities, after these rental communities are constructed and achieve a stabilized level of leased occupancy, each community is expected to be marketed for sale. Our single-family rental operations are currently reported in our Homebuilding segment. During the quarter ended December 31st, we completed our first sale of a single-family rental community representing 124 homes for $31.8 million, resulting in a gain on sale of $14 million.

We currently expect one more sale of the single-family rental community later this fiscal year. At December 31st, our homebuilding fixed assets included $106.6 million of assets related to our single-family rental platform, representing 13 communities totaling 890 single family rental homes and owned finished lots. We still expect our total investment in our single and multifamily rental platforms to more than double during fiscal 2021. Bill?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Our balanced capital approach focuses on being disciplined, flexible, and opportunistic. During the three months ended December, our cash used in homebuilding operations was $269.2 million compared to $178.4 million in the prior year period. At December 31st, we had $3.9 billion of homebuilding liquidity, consisting of $2.1 billion of unrestricted homebuilding cash and $1.8 billion of available capacity on our homebuilding revolving credit facilities.

We plan to continue maintaining higher homebuilding cash balances than in prior years to support the increased scale and activity in our business and to provide flexibility to adjust to changing market conditions. During the quarter, we issued $500 million of 1.4% senior notes due in 2027 and we've repaid $400 million of 2.55% senior notes at their maturity. Our homebuilding leverage was 17.3% at the end of December with $2.5 billion of homebuilding public notes outstanding and no senior note maturities in the next 12 months. At December 31st, our stockholders' equity was $12.5 billion and book value per share was $34.33, up 23% from a year ago. For the trailing 12 months ended December, our return on equity was 24.4%, compared to 18.2% a year ago.

During the quarter, we paid cash dividends of $73 million and our Board has declared a quarterly dividend at the same level as last quarter to be paid in February. We repurchased 1 million shares of common stock for $69.8 million during the quarter and our remaining outstanding share repurchase authorization at December 31st was $466 million. Jessica?

Jessica Hansen -- Vice President of Investor Relations and Communications

In the second quarter of fiscal 2021, based on today's market conditions, we expect to generate consolidated revenues of $6 billion to $6.2 billion and our homes closed to be in a range between 19,000 and 19,500 homes. We expect our home sales gross margin in the second quarter to be similar to the first quarter and our homebuilding SG&A as a percentage of revenues in the second quarter to be approximately the same as the first quarter. We anticipate our financial services pre-tax profit margin in the second quarter of 40% to 45% and we expect our income tax rate to be in a range of 23% to 23.5%.

For the full fiscal year of 2021, we now expect consolidated revenues of $25.2 billion to $25.8 billion and to close between 80,000 and 82,000 homes. We expect to generate positive cash flow from our homebuilding operations in fiscal 2021. However, we are not providing specific guidance for our homebuilding cash flow this year, as we prioritize augmenting our housing and land and lot inventories to support higher demand. After reinvesting in our homebuilding business, our cash flow priorities include increasing our investment in both our multi and single-family rental platforms, maintaining our conservative homebuilding leverage and strong liquidity, paying a dividend, and repurchasing shares to keep our outstanding share count flat year-over-year. David?

David V. Auld -- President and Chief Executive Officer

In closing, our results reflect the strength of our experienced operational teams, industry-leading market share for our geographic footprint and diverse product offerings across multiple brands, our strong balance sheet, ample liquidity and low leverage provide us with significant financial flexibility to effectively operate in changing economic conditions and we plan to maintain our disciplined approach to invest in capital to enhance long-term value of our company.

Thank you to the entire D.R. Horton team for your focus and hard work. Your efforts during this time have been remarkable. We are proud of your work ethic and your positive spirit, as you continue safely helping our customers close on their much-anticipated new homes. This concludes our prepared remarks, we will now host questions.

Questions and Answers:

Operator

Thank you. We will now be conducting a question-and-answer session. [Operator Instructions] Thank you. Our first question comes from the line of Carl Reichardt with BTIG. Please proceed with your question.

Carl Reichardt -- BTIG -- Analyst

Thanks. Good morning everybody. Happy New-ish Year. I wanted to talk a little about your underlying costs. Thanks for the info on stick-and-brick and land. Can you talk a little bit about what you're seeing in the labor market, David, and we're starting to hear a little more -- a few builders starting to say things are easing some, others are telling us, things are tougher and oftentimes, you'd like to talk about specific trade, specific markets, but I'm interested just broadly what your expectations are for the labor shortage beginning to ease or tighten in 2021.

David V. Auld -- President and Chief Executive Officer

I don't see it being much different than it's been in 2020, at least not for us. We set up and try to drive our communities in the most efficient way, making it the easiest part possible way we can for our trades to get in, get out, get their job done. We've actually, I think through this cycle, have been focused on the labor side and have created a lot of efficiency and have expanded our trade base just by making it easier for them to get in, get out and know what they're doing. 2021, our volume is ramping up, I think that's going to -- that's going to continue to be a challenge, but we feel very good. I mean we wouldn't be selling houses, if we couldn't build them, so.

Carl Reichardt -- BTIG -- Analyst

Fair enough. And then I wanted to ask a little bit about the West region, which the growth is slower than the really significant growth you're seeing in other places and inventory is down sequentially as well. In the meantime, South Central, you took more order dollar this quarter than you did last quarter. So I'm curious if you're thinking about shifting capital investment among the different regions, as you look into '21 and beyond. Is there a de-emphasis happening in the West or is the slowness just a function of being out of product and out of communities. Thanks.

David V. Auld -- President and Chief Executive Officer

You know the underwriting of the West is much more difficult, timelines are longer, so through this cycle, our community count has continued to slip down there. I will tell you, we have one of the best groups of people and the company in the West region. When we talk about platform, we talk about people, product, price and we are certainly have a very strong platform at West. When the returns in Texas, Florida, Carolinas have been incredible and everybody competes for capital in this company. So I will say the West is an area that I personally, I'm going to emphasize this year and I think you will see the growth return.

Jessica Hansen -- Vice President of Investor Relations and Communications

Call for reference, it will be posted after the call, but our West region community count was down 9% year-over-year and 10% sequentially, which compares to the company average, which was actually slightly up in both periods.

Carl Reichardt -- BTIG -- Analyst

That'll do it Jessica. All right. Thanks so much everyone. Congrats.

Operator

Our next question comes from the line of John Lovallo with Bank of America Merrill Lynch. Please proceed with your question.

John Lovallo, II -- Bank of America Merrill Lynch -- Analyst

Good morning, guys and thank you for taking my questions as well. The first one just on the NAHB had noted that builder respondents were growing more and more concerned with affordability with home price appreciation and also with the rates sort of grinding higher and maybe not specific to D.R. Horton, but for the industry, I mean how are you guys thinking about this dynamic and do you see any risk to industry wide demand, as the spring approaches here.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

John, this is Mike. Good morning. We are always focused on affordability, that's something that's consistent across the platform and I'm not as well versed to speak to the industry, but in our communities, we're focused on providing value at whatever price point we're at and so whether we have buyers moving up from their current housing situation to a D.R. Horton home or their first-time homebuyer with 56% of our buyers in the quarter were first time homebuyers. We're focused on providing an affordable home for that buyer that fits in their monthly budget.

Jessica Hansen -- Vice President of Investor Relations and Communications

We continue to see healthy credit metrics across that buyer group, our FICO score was 719 this quarter. I think on our Express brand stand-alone, it was almost 710. And then as we also mentioned on the call, our average square footage has continued to tick down slightly on a year-over-year basis, as home prices has have risen, but what we typically see is first time buyers, who want to buy as much home as they can get for their money and they're buying out of need, not a discretionary purchase, and so if home prices have risen, they just buy a little bit less house.

John Lovallo, II -- Bank of America Merrill Lynch -- Analyst

Yeah. That makes a lot of sense. And then how are you guys thinking about the potential for increased environmental regulations under administration, what this could mean for land development costs and timelines, things of that nature.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Well, I don't think it's going to help affordability and delay is going to extend time. We're well positioned with only control over 400,000 lots, again we're going to -- we're going to focus on affordability and as regulations increase, affordability is going to become more challenging. But given our position, our people, I think we are -- we can meet that challenge.

John Lovallo, II -- Bank of America Merrill Lynch -- Analyst

Thanks very much guys.

Jessica Hansen -- Vice President of Investor Relations and Communications

Thanks, John.

Operator

Your next question comes from the line of Stephen Kim with Evercore. Please proceed with your question.

Stephen Kim -- Evercore ISI -- Analyst

Hey guys, fun times. It's interesting that the way sometimes the builders would trade, it makes it seem like people think you just the beneficiary of good luck. But I'm reminded about that statement, you know, luck is what happens when preparation meets opportunity and you guys have done a great job over the last couple of years, preparing for this situation and so I wanted to ask you about your comment as to capital allocation, because you indicated there that you are wanting to carry higher cash levels than normal for the foreseeable future, I think you made reference to some uncertainty in the current environment, but arguably homebuilding is always difficult to predict. And so I'm curious what is a good rule of thumb for modeling your cash levels going forward and what are the kind of things that you're looking to fade or dissipate in order to pave the way for you to hold lower cash levels than that.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Sure. Good question, Steve. Just to get to the point in terms of the expected levels, we would expect at each quarter-end to maintain at least $1 billion of homebuilding cash, but would expect most quarters to see between to be $1.5 billion and $2 billion. And I'd say the primary driver behind that shift over the last year, as we've been building a little bit more is just our significant increase in volume and scale and activity, which feel like it's prudent to ensure that we have sufficient cushion to manage significant and sudden changes in the business to avoid having any potential liquidity crunches that just gives us that much more flexibility to respond when we see opportunities in the market. And so we've seen a number of significant shifts in our business over the last few years from a sharp increase in interest rates, which decreased demand in late '18 to the pandemic disruption in the spring of 2020, so then the very significant increase in demand that we saw in the summer of 2020 and ever since. And so from that standpoint, having a bit more cushion, a bit more liquidity to respond, whichever direction we need to go in the business, we just feel like it's prudent. I don't see us changing that strategy. I think that just puts us in a very strong and flexible position to respond to market changes.

Stephen Kim -- Evercore ISI -- Analyst

Okay. Yeah. Certainly sounds like we ought to be modeling that on a longer-term basis. Okay. Second question relates to the pretty awesome margins you all reported this quarter and I think you just gave guidance as to that margin fairly recently. And so, I think a lot of folks are just curious as to what drove the upside in your margin this quarter and paying note to the fact that your guidance for the March quarter suggested, it's more than just a temporary spike. I personally think you're still being conservative, but I'd love to hear what drove the upside surprise in this quarter?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Well, Steve, I'd say the first thing we expected to see this quarter that we did not is we've been seeing cost increases coming into our business over the last quarter or two and we expected to see a bit more of that come through in our closings in Q1, which we did not, that's still coming, we can see it coming through our backlog and we expect to see some of those cost increases start to hit our margins in the coming quarters. That being said, we still have a very strong environment obviously with the ability to raise prices, very low incentive levels, and so we do expect at this point now with that additional visibility of another quarter to be able to maintain the current margins that we're showing, which obviously are very, very strong levels.

Jessica Hansen -- Vice President of Investor Relations and Communications

We really had price dissection, almost this entire cycle on the material front and we have seen very neutral impact for materials, other than a little bit of headwind from lumber last year. Lumber is starting to tick back up, so that's going into our commentary as well. But really it's a function of home prices have risen significantly and building product companies have cost inflation as well and so we are experiencing some increases in material costs that we didn't see as we said closer in the December quarter, but we do expect those to start flowing through in the rest of the year.

David V. Auld -- President and Chief Executive Officer

And I'll just say that our operational teams are doing a great job at controlling cost, where we see increases we look for efficiencies to reduce cost and I mean to be honest, I think we were a little bit surprised as stick-and-brick per foot actually went down last quarter, that's just a phenomenal job by our people.

Stephen Kim -- Evercore ISI -- Analyst

Absolutely. Great. Thanks very much, guys, and best of luck.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Thanks, Steve.

Operator

Our next question comes from the line of Matthew Bouley with Barclays. Please proceed with your question.

Matthew Bouley -- Barclays -- Analyst

Good morning. Congrats on the quarter and thanks for taking the questions. I wanted to ask about the lot position of 441,000, I think you said. It really suggests that a material additions during the quarter, I guess number one, could you speak at higher level, just around what that signals around your view of the sustainability of housing demand and number two, just the color around the lots you added during the quarter, kind of duration of those lots, lot inflation, if any of that could actually impact 2021. Thank you.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Sure. And Matt, you'll notice that most of that addition to the lot position did come in the form of option lots. We continue to significantly increase our option lot position. We had noted on our last call that we do expect our own lots to increase modestly. And they did kind of get back to a normal level there. But we've been on an ongoing efforts to expand our relationships with developers across the country. Of course, our relationship with Forestar continues to bear fruit as well, so a significant portion of the additions to our lot position through options came from our third-party developers and our relationship with Forestar and with the significant growth, we've seen in demand and significant volume increases that we've seen that we certainly want to make sure we stay in position to maintain. We probably have stepped up our efforts to ensure that we're keeping our pipeline sufficiently out in front of us with the volume we're seeing today.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

The volume we see today Matt, as well as looking forward to more of a medium term, we just don't see a lot of overbuilding, a lot of excess supply in the marketplace relative to household formation demand and so we want to maintain as Bill said, adequate support of inventory for that medium term band. So that's why you're seeing our controlled lot position increase.

David V. Auld -- President and Chief Executive Officer

And the fact that we are so heavy, option does allow us to be a little more aggressive in tying things up. So it's again positioning for the future.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Very capital efficient with the options.

Matthew Bouley -- Barclays -- Analyst

Okay. Got it. That's very helpful color. Second one I wanted to ask about ASPs. I think Bill you might have mentioned or I think you said the order ASPs of $314,000 the backlog ASP is right there as well. So I'm just curious, number one, like-for-like versus mix is that's just perhaps emerald getting a lot better, but then number two, if I look at the closings and revenue guidance for the year, I mean it seems to suggest that the closing ASPs settle back down a little bit, I'm just wondering if you can reconcile that and just how to think about closing ASPs for the year. Thank you.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Sure. We always see a higher ASP in our backlog than we do in our sales in our closings, because a higher-priced homes generally are bigger and take longer to work their way through, so that's not necessarily unusual, but yes with our sales ASP being at $314,000 this quarter, that's definitely showing a continuation of some price appreciation and so, in the near term, we would expect, I think to probably still see some potential upside. That being said, our operators and our teams and our people are very focused on providing affordability and so we're going to keep an eye on the price points and the payments that our buyers need to have to afford to move into our homes and so, we never plan for significant price appreciation beyond a quarter or two, because we always know that at some point, we will make some adjustments in our operations to make sure we keep our price points affordable.

Jessica Hansen -- Vice President of Investor Relations and Communications

And our ASP per square foot on a year-over-year basis was up 4%, but sequentially, it was actually flat.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

And so the guidance doesn't reflect all of that price, it doesn't reflect quite all of that price, it reflects that we would still continue to manage very, very closely on the affordability.

Matthew Bouley -- Barclays -- Analyst

Okay. Thanks everyone and congrats again.

Operator

Our next question comes from the line of Eric Bosshard with Cleveland Research. Please proceed with your question.

Eric Bosshard -- Cleveland Research Company -- Analyst

Good morning. The increased delivery number for the year, curious what changed and where that changed and thinking a bit of geography and mix and also the production pace, but just sort of the things that changed, that have resulted in you taking a little bit more optimistic on full year deliveries.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

I think we've seen consistently strong demand across our footprint, Eric. In addition, as we've gotten the starts up in the first quarter, we started almost 23,000 homes with good visibility that starts for the next couple of quarters and so that gives us more confidence in the number we can deliver for the full year. So it's just a little flare of -- little more of the year coming into focus with what we're going to be able to accomplish.

David V. Auld -- President and Chief Executive Officer

We're also seeing a good start to the spring in January, which again it's about confidence and we don't want to put a number out there that we don't feel really good about. So we feel really good about them.

Eric Bosshard -- Cleveland Research Company -- Analyst

From a production pace and inventory pace, anything different that you're doing there or have done there to also allow you to to get more homes produced?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Anything different. It's -- we're talking about sustainability and growing the scale of our platform and doing it in a measured approach that allows us to hang on to those increases. So I wouldn't say it's anything different, it's just further execution of the same strategy of growing our capacity for production, growing our market share, market by market and that's what our teams think about every day when they're getting up and going about their job is how I get a little better today and grab a little more production capacity in my marketplace.

Eric Bosshard -- Cleveland Research Company -- Analyst

Great. Thank you.

Operator

Our next question comes from the line of Alan Ratner with Zelman and Associates. Please proceed with your question.

Alan Ratner -- Zelman and Associates -- Analyst

Hey guys, good morning. Congrats on the great results. My first question. I was hoping to drill in a bit more on the land side follow up to Matt's question earlier, if I'm just kind of looking at the growth in your lot book and obviously account for all the closings, you've had over the last year, it looks like over 40% of your current lot book or lots controlled have actually been tied up over the last 12 months since the pandemic began and I'm curious, we hear from a lot of builders, when we underwrite land, we assume today's absorptions, today's pricing and obviously the current environment makes that a little bit tricky, because your margins and your absorptions at cycle highs. So I'm curious as you look at the composition of the land you've tied up over the last 12 months, could you talk a little bit about how you're thinking about underwriting to gross margin, to return on inventory, to absorptions whatever metrics you guys think about internally and how that compares to where you're generating business today?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Our underwriting really hasn't changed much, as we've seen absorptions increase, it does -- when we're requiring a two-year cash back at a 10-a-month absorption, you can buy more lots that you can on 5-a-month absorption. So we have seen the scale of the deals get a little bigger, but the position that from a pricing and location standpoint, I don't see that we've given up much in the deals we're doing today versus the deals we were doing two or three, four years ago. Scale is bigger, the phase sizes are bigger, lot prices have been pretty stable and like I said this on the last call, when I'm traveling and looking at deals, the deals that we would put on the books this quarter were better than most of the deals that we had on the books. So it's very -- it gives me a lot of confidence and our guys are doing a great job. So I don't see deterioration in our our lot position from a market ability or really even a pricing standpoint.

Alan Ratner -- Zelman and Associates -- Analyst

Got it. That's helpful color. Second question on the closing guidance for the year, I just want to maybe get a little bit more commentary there. So if I look at your 2Q guide, your closings are going to be up just under 40% through the first half of the year and for the full year guide, the midpoint I think it's a 24% increase, which obviously is incredibly strong. But I'm just curious what's driving that deceleration in the back half, because your backlog is going to be a very strongly -- so is this a function of conservatism around cycle times and just the backlog conversions might be a bit lower than years past because of how elevated the backlogs are or is there something else that's driving maybe that deceleration in the back half.

Jessica Hansen -- Vice President of Investor Relations and Communications

It's really the stage of construction our homes are in Alan. We have a lot fewer completed specs today than we typically have and as a result, we're selling and closing fewer homes intra-quarter than we typically would, I think the quarter that was in the 20 -- mid 20% range and typically it's in the high 30% or 40% range. And so, it's really just a function of the stage of our inventory and we did get, as Mike said almost 23,000 homes started this quarter, but a lot of those are still in the early stages of construction and so a lot of the homes that we'll be starting here a little bit later in the year, won't be available for this fiscal year, but they'll put us in a very good position to continue growth in fiscal 2022.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

And when you look, obviously, at the year-over-year increases, we started to see some very significant year-over-year increases in Q3, last year's Q3 and Q4 were much more significant, so the year-over-year increases going forward are naturally not going to necessarily continue at the same pace they are right now, but we're still expecting a very strong year, very strong year-over-year increase for fiscal '21.

Alan Ratner -- Zelman and Associates -- Analyst

Sure. Absolutely. That's helpful. Thanks guys, good luck.

Operator

Our next question comes from the line of Michael Rehaut with J.P. Morgan. Please proceed with your question.

Michael Rehaut -- J.P. Morgan -- Analyst

Thanks. Good morning, everyone, and congrats on the results. The first question I kind of wanted to ask about the underwriting in the gross margins, maybe from another angle and apologies if maybe I'm beating a dead horse here, but with the gross margins at 24%, obviously, that's -- you almost have a very good problem to deal with in kind of keeping those margins sensibly, to the extent possible at these levels, which are kind of rarefied air for you historically. You mentioned earlier that you haven't seen much appreciation in the lot prices, lot price has been pretty stable and the deal flow is pretty attractive right now. But if home price appreciation were to moderate, obviously today it's in a, let's call it a high single-digit type of year-over-year dynamic on a same store basis, if that were to moderate more to like a low single digit rate, given where your underwriting the deals to today, should we expect that gross margin to come in a little bit over the next couple of years, is that the right way to think about it or are there other factors that maybe were not appreciated.

Jessica Hansen -- Vice President of Investor Relations and Communications

We really have no insight to gross margin in the next few years, I mean gross margin really is a function of the market, Mike, we're focused on underwriting to returns and although we don't see it right now, even if we did see a compression in our gross margins for whatever reason, affordability, interest rate, something that we don't foresee today as an issue, we can still generate very attractive returns on our current land bank with the efficiencies that David has kind of already talked to in our business today and our ability to keep turning our houses. But we feel very comfortable with our current lot position that we are going to be able to offset costs going forward and hopefully hanging around this 24% range. But really further than a quarter out, we don't have a whole lot of visibility because we do turn our houses is much more quickly, I think than the industry by and large and so we have the best early read on costs and gross margin in the market.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

I can't emphasize enough that gross margin is not part of our underwriting hurdles, returns is our underwriting hurdle and certainly higher gross margins can generate higher returns but we focus first and foremost on hitting returns, hitting our absorptions in each community, and then the market sometimes will give you more margin than you may have underwritten.

David V. Auld -- President and Chief Executive Officer

If you look at our average sales price, we are significantly more affordable than most of our peers in the home building space and our land portfolio and our operating structures are designed and geared to drive that affordability. So are we -- when I look at the competitive Mike out there, both of the resale market, which is really today our primary competitor, at this price points and our peers in the industry, it's -- I mean we feel very good about our current position, which allows us to underwrite and execute the positions that we believe will keep us in this range.

Michael Rehaut -- J.P. Morgan -- Analyst

All right. No, I appreciate it. I guess, secondly, I just wanted to zero in on SG&A for a moment. The results were significantly better than what you were looking for, I think by order of about 100 basis points. Yes, your closings were only modestly above guidance, so I was wondering you had mentioned leverage off of the strong volume, but you really had instead of 40 basis points, 140 basis points of year-over-year leverage and additionally, you're expecting SG&A ratio to be flat sequentially versus historically a little bit better, so I'm just wondering if there was anything specific in the first quarter and I apologize if I missed this earlier that benefited the spreads, this past quarter more on a onetime basis or what kind of drove that differential?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Mike, I think you -- you touched on part of it, deliveries were a little bit ahead of what we had guided to. In addition, the ASP is a little higher, little more SG&A leverage, something Jessica touched on before, is the lower level of completed inventory, especially the completed specs that we're carrying the business today, able to operate the inventory portfolio very efficiently, and that requires less SG&A to maintain and care for those homes, while they're sitting completely, because we do run those costs through SG&A. So as we have less of those, we have around 5,000 a year ago and today, we have about 1,600. So that's an improvement and a tailwind as well.

Jessica Hansen -- Vice President of Investor Relations and Communications

And although we guided to flat SG&A sequentially on a year-over-year basis, it would actually be approximately 40 basis points of leverage, which is still a pretty nice move. And when we think about it on an annual basis, as our SG&A is already at record lows, we're not going to ever just be able to model and say that our SG&A is going to be down more than say that on an annual basis. Can we ultimately maybe get there, if you continue to see prices rising ASP plays a big role in that. Sure. But right now we feel like leveraging our SG&A 40 basis points on a year-over-year basis is a really nice move.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

But nothing one-time. Yes, there are some changing conditions and the volume and pricing has helped, but nothing -- nothing one-time in the quarter.

Michael Rehaut -- J.P. Morgan -- Analyst

Great. Thanks so much guys.

Jessica Hansen -- Vice President of Investor Relations and Communications

Thanks, Mike.

Operator

Our next question comes from the line of Nishu Sood with UBS. Please proceed with your question.

Nishu Sood -- UBS -- Analyst

Thank you. So first question I wanted to ask was around demand trends. A lot of folks are wondering demand has been so strong, what's it going to look like when life returns to normal. I mean, clearly we're far from being back to normal, but in our last quarter obviously, vaccine news, there is some hope out there, is there anything you can -- you've seen in terms of the traffic or what folks are looking for or how that's evolving, that gives us any insights into how your homebuyers are looking at things?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

The demand out there I think is really driven by demographics and I think it has been accelerated because of the pandemic and people's desire to become -- or to find a safe environment for their family. I really don't see that demand issue changing, I mean if it accelerates, it's a long-term program and it got accelerated, I think it's going to stay. So I mean we are positioning, we are driving to take advantage of as much of the demand as we can. And it's I mean, right now, today it's -- it's very good out there.

Jessica Hansen -- Vice President of Investor Relations and Communications

A lot of our floor plans Nishu, actually already incorporated flex space, so depending on what a buyer is looking for today, whether it be a home office, a second home office, a learning space for their kids, those types of things, we've already always had floor plans that can accommodate that. And we can continue to adjust our starts based on what those homebuyers are potentially looking for and I think that have always been true our as people start their families and have children, they generally want to backyard for their kids, they want good public schools, maybe a garage for their cars, those things have kind of always been true that go along with the demographic side of the equation that David was talking to. So I would say there an acceleration from the pandemic and that's been positioned in the right places with a lot of different floor plans to choose from, no significant change on that front.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Still the strongest demand is at the most affordable price. And that's been a trend that we've been saying for quite a while. Obviously, we're very well positioned to take advantage of that, the environment right now with low interest rate that's accommodated for that as well and certainly a benefit for that demand as well, which for right now, we don't really see that changing much in the near term.

Nishu Sood -- UBS -- Analyst

Got you, got you. Makes sense. So, second question I wanted to ask was around your inventory levels. So demand has been so strong, obviously you folks have ramped up your starts considerably, but still remains, just looking at metric like your inventory against your backlog, just kind of sizing it, still remains behind where it would be normally. Are we in a market where demand is just so strong, it will be difficult to get back to your normal or targeted levels of inventory or do you see, as the year progresses, here there could be some progress on that, even if demand does remain as strong as it has been.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

If demand remains at the exact level that it is today, it'll be very challenging for us to get back to historical relationship between total inventory and backlog. If demand is that good, we look at our starts capacity, neighborhood-by-neighborhood, week-by-week and we are increasing that capacity over time to make sure it's sustainable and we're doing it with our trade partners in mind. So like while we're doing that, demand continues to expand to absorb that additional capacity, we're putting in the marketplace that at the price points we're serving.

Jessica Hansen -- Vice President of Investor Relations and Communications

Really more focused Nishu on homes conversions than backlog conversion, I mean backlogs have functioned at what we're selling and we're going to sell, what's out there from a demand perspective, and ultimately we will get the houses started. We've got the lot position to do it unlike anyone else in the industry, we wouldn't be selling the houses, if we didn't have the lot and feel comfortable about our cost structure and what kind of return we are going to generate on those houses.

So we're really focused on the houses we have an inventory and how quickly we're turning those and rather than a backlog conversion metric, trying to improve our housing inventory turn and generally we turn that at least two times a year, last year we did a little bit better than that and this year, now with our new guidance, we're reflecting better than two times as well.

David V. Auld -- President and Chief Executive Officer

We talk to our operators all the time about being disciplined, focused, and consistent and you're starting the communities and that's how we're building capacity to deliver more homes by that execution at the community level.

Nishu Sood -- UBS -- Analyst

Got it. Thanks so much.

Operator

Our next question comes from the line of Anthony Pettinari with Citi. Please proceed with your question.

Anthony Pettinari -- Citi -- Analyst

Good morning. I'm wondering if you could talk a little bit about expected seasonality for the year and given the buyer traffic patterns you've seen, does that lead you to believe you'll see kind of a traditional spring selling season or could demand maybe be more evenly distributed throughout the year and I think we've heard from others that buyers are visiting homes, maybe on what used to be off peak days or off peak hours, is that something you've seen or can you just comment generally on any kind of changes you've seen in buyer behavior?

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Yeah. We've certainly seen very different seasonality throughout 2020, stronger demand through the summer, fall, winter in 2020 than we've seen historically. So we're coming off of some unusually strong periods. But that being said, with what we've seen thus far in January, we're seeing increases in volume that we would expect to see. It remains to be seen whether we'll still see the same percentage relationships between our Q2 and Q1 that we've seen historically or not, but right now we just see a very strong demand environment definitely some different patterns in buyer behavior than we've seen historically, but we're feeling good about what we can see going ahead. With a very strong Q1, will we see the same sort of patterns throughout the fiscal year, we historically have seen, I would expect there to be a bit of flattening of some of the historical patterns, but obviously off to a very good start and I think the way things are looking right now, we are optimistic about spring.

Anthony Pettinari -- Citi -- Analyst

Okay. That's helpful. And then, it seems like some of your peers are pushing price and slowing down sales pace given some production constraints. I'm wondering if you're seeing markets, where price increases by competitors or maybe a bit steeper than yours and has that improved your value proposition for customers or maybe to ask the question another way, do you think your affordability just maybe stronger than it was 12 months ago with competitors raising prices or any kind of general comments on the pricing environment?

David V. Auld -- President and Chief Executive Officer

So if you just look at our average sales price, the increase over quarter over quarter over quarter compared to our competitors. And yes, I would say our competitive advantage has increased and improved. But again, it really comes down to the ability to deliver the homes and I think yes, we've gained the largest competitive advantage with the discipline around what we're doing and the focus on efficiency over the last couple of years. So it's -- it doesn't do any good to sell a house at any price if we can't deliver. So we're focused on the delivery side of it, expanding our capacity. We are becoming more and more efficient through our processes.

Anthony Pettinari -- Citi -- Analyst

Okay. That's helpful. I'll turn it over.

Operator

Our next question comes from the line of Jack Micenko with Susquehanna. Please proceed with your question.

Jack Micenko -- Susquehanna Financial Group -- Analyst

Hey, good morning. We talked a lot about returns, we talked about underwriting not really focusing on margin and David you sound pretty constructive on the land environment. I guess my question would be thinking about Horton as this longer term 60-40 option versus owned mix, coming in at 72 this quarter, is 72 the new 60, the goalposts changed or is it really more of an interim function that's where the market's kind of brought you in terms of availability of new acquisitions over the last couple of quarters?

David V. Auld -- President and Chief Executive Officer

I'd say 70 is the new 60. We're going to continue to try to grind that number higher. Ultimately, it comes down to the relationships and execution in the field and that's what we focus on every day. So it's -- my expectation over time is that we will continue to grind, a point here, a point there and drive better and better efficiency, capital efficiency through our business and through our company, ultimately probably the industry.

Jack Micenko -- Susquehanna Financial Group -- Analyst

Okay. Great. Thanks. And then, looking at the single-family rental sale, it would appear that the gross margins on those 124 homes was pretty healthy, maybe an excess of the company margin, am I looking at that the right way or is there something I'm missing, obviously you've got your G&A costs and everything below the line, but just from a -- just from a -- purely a margin perspective, it looks like that was a really healthy margin on the sale of those units.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Yeah. We're very pleased with that transaction and we look forward to that, continuing to explore that business, it seems to be attracting a lot of capital and a lot of interest today and we expect to build to take advantage of that.

Jack Micenko -- Susquehanna Financial Group -- Analyst

All right. Thanks for taking my questions.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Thank you, Jack.

Operator

Our next question comes from the line of Susan Maklari with Goldman Sachs. Please proceed with your question.

Susan Maklari -- Goldman Sachs -- Analyst

Thank you and congratulations on the results. My first question is just -- I wondered if you could perhaps quantify a bit more the comments around January, just perhaps framing the magnitude of what you're seeing either sequentially or on a year-over-year basis for us?

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

You know Sue, three weeks in, we rarely comment on a single month much less, just a few weeks, so but suffice it to say what we generally expect when we get into January, as we expect there to be a step up in traffic and volume coming through our weekly sales pace. And so we have seen that, we've seen three weeks of weekly sales thus far and there has been that discernible step up in volume in January versus what we had seen in the December quarter, so we're encouraged by that.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Several years ago, we would be the spring selling season to kick in with Super Bowl effectively at the end of January, early February, the past several years, this year be no exception. We've seen that sales pace accelerate coming out of the holidays after January 1st.

Susan Maklari -- Goldman Sachs -- Analyst

Okay. Thanks. That's helpful. And my next question is around what you're seeing in terms of some of the suppliers. We've obviously heard that with the ramp in volumes and some of the supply chain issues that those companies are seeing in their own businesses that there has been some constraints, maybe especially in some areas like appliances and windows. Can you just talk to what you're seeing there and I guess maybe in some areas, is there anything that you've heard more recently around the issue with some of the semiconductor supplies and some of the issues that they're seeing in those industries?

Jessica Hansen -- Vice President of Investor Relations and Communications

So, really various products are in short supply Sue, it kind of depends on what market and what day, would agree with your sentiments on both windows and appliances. We've had challenges in both of those. Our product partners have been working hard to support our business, so we don't want to push back any closings and we've been very pleased, where we have to, we substitute, upgrade, and even install other brands if necessary to make sure we're not having to push closings. I don't know that I have anything specific on semiconductors that I've heard as of late, but I really would have put windows again as the headliner this quarter, it's probably actually gotten even a little worse than when we said that last quarter.

Susan Maklari -- Goldman Sachs -- Analyst

Got you. Okay. Thank you.

Jessica Hansen -- Vice President of Investor Relations and Communications

Thanks, Sue.

Operator

Thank you. Due to time constraints, our final question will come from the line of Buck Horne with Raymond James. Please proceed with your question.

Buck Horne -- Raymond James -- Analyst

Hey. Thanks for squeezing me in. I appreciate it. I'll try to keep this one quick. Question we get a lot from investors is kind of just where is all this buyer demand coming from, how sustainable it is and I'm just curious if you get from a high level perspective, any evidence of the population migration that seems to be happening around the country, are you seeing any noticeable uptick in out-of-state buyers or out-of-market buyers versus your historical normal and has that changed at all, one way or the other since the pandemic began?

Jessica Hansen -- Vice President of Investor Relations and Communications

I would say anecdotally, yes, I mean we continue to see Texas and Florida, as our two strongest space with a lot of diversity just even within those states, but clearly there has been a flight and a lot of cases from the Coast to Texas to Florida, to the Carolinas and then from the West Coast into Salt Lake, into Vegas, into Phoenix and so I think we would expect that trend to continue. And in that regard, really like our positioning as it pertains to our lot position across the country.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

I also like the fact that you don't see existing home inventory levels held for sale at high levels at all. Supply is very tight for homes that are available in the next 60 to 90 days and that has been a consistent part of our business model forever is to be an alternative to that used home and provide a customer with a new home on their timeline.

Jessica Hansen -- Vice President of Investor Relations and Communications

And Buck, you didn't ask this specific question, but we've had a lot of conversations over the last quarter, so about just the age and for the last however many years about are millennials ever going to buy a home, coming up around 35% of our business in 2019 was to buyers 34 and under. We saw that pretty quickly in the pandemic and through the remainder of fiscal '20 and now into '21 tick up to the low 40s. So I think as you know, 42% versus 35% is a pretty big move and we've seen that settle out to where over 40% of our buyers are 34 and under, I think answering that question that yes, millennials are going to own homes.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Everything we're saying it's been the long-term trends that we've been experiencing really coming out of the downturn, COVID accelerated and it feels like right now that that acceleration is kind of the new norm going forward.

Buck Horne -- Raymond James -- Analyst

That's extremely helpful. Thank you, guys. Appreciate all that color. And just one last one on the single-family rental business, just follow up on that, outstanding community trade. I'm just wondering, you mentioned that you plan to double your investment in the platform over the course of this year. So it sounds like there is quite a bit of scalable opportunity, how do you think about the total market opportunity for developing single-family rentals within your platform and would you continue on this method of building it yourself, pre-leasing it and then flipping it stabilized or do you -- would you pre-sell some of these or partner with investors, Head of Development, how do you envision the scaling up of the that business.

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Where we are today with the program is we're still learning the business and the execution side of it, we were very pleased with the first transaction, and as we learn more about the market, we will evaluate various alternatives for how we want to go about scaling it out and ultimately capitalizing it. But we need to -- we need to know more about what we're doing. We do see a lot of opportunity. We think there is some portion of the population that will be a great customer for this product that desires a single-family lifestyle, but that may not for whatever reason be purchasing a home and so we want to build up to be in a position to help supply this.

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

And Buck, just to clarify the comment about doubling our investment this year refers to our entire rental platform, both multi-family and single-family, so our total assets and the combined platform at the beginning of the year was $330 million. So we expect that $330 million to more than double in fiscal '21.

Buck Horne -- Raymond James -- Analyst

All right. Got it. Thank you so much and congratulations.

Operator

We have reached the end of the question-and-answer session. Mr. Auld, I would now like to turn the floor back over to you for closing comments.

David V. Auld -- President and Chief Executive Officer

Thank you, Christine. We appreciate everybody's time on the call today and look forward to speaking with you again with our second quarter results and to the D.R. Horton team, an outstanding first quarter. We're set up to have an unbelievable year. Stay humble, stay hungry, and stay focused. Thank you.

Operator

[Operator Closing Remarks]

Duration: 66 minutes

Call participants:

Jessica Hansen -- Vice President of Investor Relations and Communications

David V. Auld -- President and Chief Executive Officer

Michael J. Murray -- Executive Vice President and Chief Operating Officer

Bill W. Wheat -- Executive Vice President and Chief Financial Officer

Carl Reichardt -- BTIG -- Analyst

John Lovallo, II -- Bank of America Merrill Lynch -- Analyst

Stephen Kim -- Evercore ISI -- Analyst

Matthew Bouley -- Barclays -- Analyst

Eric Bosshard -- Cleveland Research Company -- Analyst

Alan Ratner -- Zelman and Associates -- Analyst

Michael Rehaut -- J.P. Morgan -- Analyst

Nishu Sood -- UBS -- Analyst

Anthony Pettinari -- Citi -- Analyst

Jack Micenko -- Susquehanna Financial Group -- Analyst

Susan Maklari -- Goldman Sachs -- Analyst

Buck Horne -- Raymond James -- Analyst

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