Company: LGIH
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0001580670-25-000043
Chunk: 139

Company: LGI Homes, Inc.
Filing Date: 2025-04-30
Form: 10-Q
Item: Part II, Item 7
Chunk 139
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 120 Home closings996 1,083 Average sales price per home closed$352,831 $360,897 Gross margin (1)$73,713 $91,401 Gross margin % (2)21.0 %23.4 %Adjusted gross margin (3)$82,789 $98,805 Adjusted gross margin % (2)(3)23.6 %25.3 %EBITDA (4)$14,852 $30,368 EBITDA margin % (2)(4)4.2 %7.8 %

(1)Gross margin is home sales revenues less cost of sales.

(2)Calculated as a percentage of home sales revenues.

(3)Adjusted gross margin is a non-GAAP financial measure used by management as a supplemental measure in evaluating operating performance. We define adjusted gross margin as gross margin less capitalized interest and adjustments resulting from the application of purchase accounting included in the cost of sales. Our management believes this information is useful because it isolates the impact that capitalized interest and purchase accounting adjustments have on gross margin. However, because adjusted gross margin information excludes capitalized interest and purchase accounting adjustments, which have real economic effects and could impact our results, the utility of adjusted gross margin information as a measure of our operating performance may be limited. In addition, other companies may not calculate adjusted gross margin information in the same manner that we do. Accordingly, adjusted gross margin information should be considered only as a supplement to gross margin information as a measure of our performance. Please see “—Non-GAAP Measures” for a reconciliation of adjusted gross margin to gross margin, which is the GAAP financial measure that our management believes to be most directly comparable.

(4)EBITDA is a non-GAAP financial measure used by management as a supplemental measure in evaluating operating performance. We define EBITDA as net income before (i) interest expense, (ii) income taxes, (iii) depreciation and amortization and (iv) capitalized interest charged to the cost of sales. Our management believes that the presentation of EBITDA provides useful information to investors regarding our results of operations because it assists both investors and management in analyzing and benchmarking the performance and value of our business. EBITDA provides an indicator of general economic performance that is 

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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