Company: SDHC
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001982518-25-000064
Chunk: 108

Company: Smith Douglas Homes Corp.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 8
Chunk 108
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 For the three and six months ended June 30, 2025, other (income) expense, net reflected a positive impact of $1.1 million and $0.6 million, respectively, from the three and six months ended June 30, 2024, primarily due to remeasurement of contingent liability charges of $1.2 million and $1.3 million during the three and six months ended June 30, 2024, respectively, which did not recur in 2025.

Provision for income taxes

After consummation of the IPO, Smith Douglas Homes Corp. became subject to U.S. federal, state, and local income taxes with respect to its allocable share of taxable income of Smith Douglas Holdings LLC assessed at the prevailing corporate tax rates. Smith Douglas Holdings LLC operates as a limited liability company and is treated as a partnership for income tax purposes. Accordingly, it incurs no significant liability for federal or state income taxes, since the taxable income or loss is passed through to its members. Provision for income taxes was $0.7 million and $1.1 million, respectively, for the three months ended June 30, 2025 and 2024, which reflects an effective tax rate of 4.3% and 4.4%, respectively. Provision for income taxes was $1.6 million and $2.1 million, respectively, for the six months ended June 30, 2025 and 2024, which reflects an effective tax rate of 4.4% and 4.3%, respectively.

On July 4, 2025, the One Big Beautiful Bill Act was enacted in the U.S. While we are assessing its impact, we do not currently believe that it will have a material impact on our income tax expense. See Note 1—Description of the business and summary of significant accounting policies to our unaudited condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

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Net income

The following table sets forth net income by reportable segment for the periods presented (in thousands):

 Three months ended June 30,Six months ended June 30, 20252024Period over period change 20252024Period over period change Southeast$21,991$25,598$(3,607)$45,846$46,603$(757)Central6,34513,336(6,991)13,35523,619(10,264)Segment