Company: SDHC
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001982518-25-000064
Chunk: 62

Company: Smith Douglas Homes Corp.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 1
Chunk 62
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 adjusted EBITDA margin to the GAAP financial measure of net income and net income margin for each of the periods indicated:

Three months ended June 30,Six months ended June 30,2025202420252024Net income$16,435$24,734$35,145$45,220Capitalized interest charged to cost of home closings3653335211,054Interest expense7725911,4381,289Interest income(98)(290)(224)(368)Provision for income taxes7441,1321,6012,053Depreciation5803681,066709EBITDA$18,798$26,868$39,547$49,957Share-based payment expense9691,0371,5811,929Purchase accounting adjustments included in cost of home closings34(379)(118)(260)Remeasurement of contingent consideration liability—1,245—1,308Real estate inventory impairment and lot option contract abandonment charges——1,358—Adjusted EBITDA$19,801$28,771$42,368$52,934Net income margin(1)7.3%11.2%7.8%11.0%EBITDA margin(1)8.4%12.2%8.8%12.2%Adjusted EBITDA margin(1)8.8%13.0%9.4%12.9%

(1)Calculated as a percentage of home closing revenue.

40

Our EBITDA and EBITDA margin decreased from the three and six months ended June 30, 2024 to the same periods in 2025, primarily as a result of decreases in net income of $8.3 million and $10.1 million, respectively. Our adjusted EBITDA and adjusted EBITDA margin decreased from the three and six months ended June 30, 2024 to the same periods in 2025, primarily as a result of remeasurement of contingent consideration liability [related to the Devon Street Homes Acquisition] during the three and six months ended June 30, 2024 which did not recur in 2025.

Net debt-to-net book capitalization

Net debt-to-net book capitalization is a supplemental measure of our leverage that is not required by, or presented in accordance with, GAAP and should not be considered as an alternative to debt-to-book capitalization or any other measure derived in accordance with GAAP. We caution investors that amounts presented