Company: LGIH
Filing Date: 2025-04-30
Form Type: 10-Q
Source: 0001580670-25-000043
Chunk: 57

Company: LGI Homes, Inc.
Filing Date: 2025-04-30
Form: 10-Q
Item: Part I, Item 1
Chunk 57
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 us, our business, customers, subcontractors and suppliers (including associated supply chain disruptions);

•negative publicity or poor relations with the residents of our projects;

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•existing and future litigation, arbitration or other claims;

•availability of qualified personnel and third-party contractors and subcontractors;

•the impact on our business of any future government shutdown;

•other risks and uncertainties inherent in our business;

•other factors we discuss under the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”; and

•the risk factors set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

You should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement. We expressly disclaim any intent, obligation or undertaking to update or revise any forward-looking statements to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained in this Quarterly Report on Form 10-Q.

ITEM 3.         QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our operations are interest rate sensitive. As overall housing demand is adversely affected by increases in interest rates, a significant increase in mortgage rates may negatively affect the ability of homebuyers to secure adequate financing. Higher interest rates could adversely affect our revenues, gross margin and net income.

Quantitative and Qualitative Disclosures About Interest Rate Risk

We utilize both fixed-rate debt and variable-rate debt as part of financing our operations. We do not have the obligation to prepay our senior notes or our fixed-rate inventory related obligations prior to maturity, and, as a result, interest rate risk and changes in fair market value should not have a significant impact on our fixed-rate debt.

We currently do not hold derivatives for trading or speculative purposes, but we may do so in the future. Many of the statements contained in this section are forward looking and should be read in conjunction with our disclosures under the heading “Cautionary Statement about Forward-Looking Statements” above.

We are exposed to market risks related to fluctuations in interest rates on our outstanding variable rate indebtedness.  As of March 31, 2025, we had $544.4 million of variable rate indebtedness outstanding under the 2024 Credit Agreement. All