Company: SDHC
Filing Date: 2025-08-06
Form Type: 10-Q
Source: 0001982518-25-000064
Chunk: 68

Company: Smith Douglas Homes Corp.
Filing Date: 2025-08-06
Form: 10-Q
Item: Part I, Item 1
Chunk 68
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 nonpayment for a specified period may constitute a material breach of a material obligation under the Tax Receivable Agreement and therefore accelerate payments due under the Tax Receivable Agreement. In addition, if Smith Douglas 

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Holdings LLC does not have sufficient funds to make distributions, our ability to declare and pay cash dividends will also be restricted or impaired.

See Part I—Item 1A. Risk Factors—Risks Related to our Organizational Structure of our Annual Report and Certain Relationships and Related Person Transactions of our Proxy Statement.

Cash flows from operating, investing, and financing activities – comparison for the six months ended June 30, 2025 and 2024

The following table summarizes our cash flows for the periods presented (in thousands):

Six months ended June 30,20252024Net cash used in operating activities$(63,847)$(9,234)Net cash used in investing activities(4,225)(3,153)Net cash provided by financing activities62,4869,908Net (decrease) in cash and cash equivalents(5,586)(2,479)Cash and cash equivalents, beginning of period22,36319,777Cash and cash equivalents, end of period$16,777$17,298

Operating activities

We used $63.8 million and $9.2 million in net cash in operating activities for the six months ended June 30, 2025 and 2024, respectively. Operating cash flows for the six months ended June 30, 2025 benefited from cash generated by net income of $35.1 million and non-cash operating expenses of $5.4 million, which were more than offset by a $64.0 million increase in real estate inventory, $30.1 million increase in deposits on real estate under option or contract, and a $10.3 million decrease in accrued expenses and other liabilities. Operating cash flows for the six months ended June 30, 2024 benefited from cash generated by net income of $45.2 million and non-cash operating expenses of $5.1 million, which were more than offset by a $50.3 million increase in real estate inventory and a $9.2 million increase in deposits on real estate under option or contract. 

Investing activities

We used $4.2 million and $3.2 million in net cash in investing activities for the six months ended June 30, 2025 and 2024, respectively. The net cash used in investing activities during the six