Company: SDHC
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001628280-25-049591
Chunk: 115

Company: Smith Douglas Homes Corp.
Filing Date: 2025-11-05
Form: 10-Q
Item: Part I, Item 8
Chunk 115
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$83,044Capitalized interest charged to cost of home closings6983511,2191,405Interest expense8986142,3361,903Interest income(80)(224)(304)(592)Provision for income taxes1,0211,7612,6223,814Depreciation7004191,7661,128EBITDA$19,452$40,745$58,999$90,702Share-based payment expense1,0541,2342,6353,163Purchase accounting adjustments included in cost of home closings120(410)2(670)Remeasurement of contingent consideration liability———1,308Real estate inventory impairment and lot option contract abandonment charges1,580—2,938—Adjusted EBITDA$22,206$41,569$64,574$94,503Net income margin(1)6.2%13.6%7.2%12.1%EBITDA margin(1)7.4%14.7%8.3%13.2%Adjusted EBITDA margin(1)8.5%15.0%9.1%13.7%

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

Our EBITDA and EBITDA margin decreased from the three and nine months ended September 30, 2024 to the same periods in 2025, primarily as a result of decreases in net income of $21.6 million and $31.7 million, respectively. Our adjusted EBITDA and adjusted EBITDA margin decreased from the three and nine months ended September 30, 2024 to the same periods in 2025, primarily as a result of decreases in net income of $21.6 million and $31.7 million, respectively, real estate inventory impairment and lot option contract abandonment charges during the three and nine months ended September 30, 2025, which did not occur in 2024, and remeasurement of contingent consideration liability related to the Devon Street Homes Acquisition during the three and nine months ended September 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 in