Company: LGIH
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0001580670-25-000043
Chunk: 118

Company: LGI Homes, Inc.
Filing Date: 2025-04-30
Form: 10-Q
Item: Part I, Item 2
Chunk 118
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. EBITDA provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization and items considered to be unusual or non-recurring. Accordingly, our management believes that this measure is useful for comparing general operating performance from period to period. Other companies may define this measure differently and, as a result, our measure of EBITDA may not be directly comparable to the measures of other companies. Although we use EBITDA as a financial measure to assess the performance of our business, the use of this measure is limited because it does not include certain material costs, such as interest and taxes, necessary to operate our business. EBITDA should be considered in addition to, and not as a substitute for, net income in accordance with GAAP as a measure of performance. Our presentation of EBITDA should not be construed as an indication that our future results will be unaffected by unusual or non-recurring items. Our use of EBITDA is limited as an analytical tool, and you should not consider this measure in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are: 

(i) it does not reflect every cash expenditure, future requirements for capital expenditures or contractual commitments, including for purchase of land; 

(ii) it does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt; 

(iii) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced or require improvements in the future, and EBITDA does not reflect any cash requirements for such replacements or improvements; 

(iv) it does not adjust for all non-cash income or expense items that are reflected in our statements of cash flows; 

(v) it does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations; and 

(vi) other companies in our industry may calculate it differently than we do, limiting its usefulness as a comparative measure. 

Because of these limitations, our EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business or as a measure of cash that will be available to us to meet our obligations. We compensate for these limitations by using our EBITDA along with other comparative tools, together with GAAP measures, to assist in the evaluation of operating performance. These GAAP measures include operating income, net income