Company: UHG
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001830188-25-000036
Chunk: 44

Company: United Homes Group, Inc.
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 1
Chunk 44
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, 2025 and 2024, resulted in a gain of $0.9 million and a loss of less than $0.1 million, respectively. These changes are included in Change in fair value of derivative liabilities on the Condensed Consolidated Statement of Operations. The Private Placement Warrants were valued using the following assumptions under the Monte Carlo method:

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March 31, 2025December 31, 2024Current stock price$2.80 $4.23 Exercise price$11.50 $11.50 Expected life (in years)3.00 3.25 Risk-free interest rate3.90 %4.30 %Expected volatility56 %52 %Expected dividend yield— — 

The public warrant liability is recognized in accordance with ASC 815 as a derivative liability and marked to market at each reporting period end. The change in fair value of the public warrant liability for the three months ended March 31, 2025 and 2024 resulted in a gain of $2.3 million and a loss of $0.1 million, respectively. These changes are included in Change in fair value of derivative liabilities on the Condensed Consolidated Statement of Operations. 

Note 14 - Income taxes

The Company recognized an income tax benefit for the three months ended March 31, 2025 of $1.3 million as compared to $1.2 million for the three months ended March 31, 2024. At the end of each interim period, the Company estimates the effective tax rate expected to be applicable for the full fiscal year and this rate is applied to the results for the year-to-date period, and then adjusted for any discrete period items. Excluding discrete items related to fair value adjustments on derivative liabilities, the Company's estimated effective tax rate as of March 31, 2025 is 30.0% as compared to 33.4% as of March 31, 2024. This differs from the federal statutory rate of 21.0% primarily due to state income tax expense and nondeductible stock compensation expense for executives. 

Note 15 - Earnings per shareThe Company computes basic net earnings per share using net income attributable to Company common stockholders and the weighted average number of common shares outstanding during each period. The following table sets forth the computation of the Company’s basic and diluted net earnings per share (in thousands, except shares and earnings per share):Three Months Ended March 31