Lennar Corporation (NYSE:LEN) Q3 2020 Earnings Conference Call - Final Transcript
Sep 15, 2020 • 11:00 am ET
Welcome to Lennar's Third Quarter Earnings Conference Call. [Operator Instructions]
I would now like to turn the call over to Alexandra Lumpkin for the reading of the forward-looking statements.
Thank you, and good morning. Today's conference call may include forward-looking statements, including statements regarding Lennar's business, financial condition, results of operations, cash flows, strategies and prospects. Forward-looking statements represent only Lennar's estimates on the date of this conference call and are not intended to give any assurance as to actual future results. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties.
Many factors could affect future results and may cause Lennar's actual activities or results to differ materially from the activities and results anticipated in forward-looking statements. These factors include those described in yesterday's press release and our SEC filings, including those under the caption Risk Factors contained in Lennar's Annual Report on Form 10-K, most recently filed with the SEC. Please note that Lennar assumes no obligation to update any forward-looking statements.
I would now like to introduce your host, Mr. Stuart Miller, Executive Chair. Sir, you may begin.
Good morning, and thank you everyone. This morning, I'm here in Miami once again, scale-down crew; that includes, Diane Bessette, our Chief Financial Officer; David Collins, our Controller; Bruce Gross, CEO of Lennar Financial Services; and of course, Alex, who you just heard from; Rick Beckwitt, our Chief Executive Officers in Colorado; and Jon Jaffe is in California, Jon Jaffe, our Presidents, in California, and they're on the line with us this morning, and will participate in our question and answer period.
Today, we're going to keep our remarks brief. We have historically given a broad overview when market conditions have been uncertain. Today, however, with a clearly defined, strong and improving market will leave more time for your questions. Therefore, I'll give a brief overview, and Diane will give financial information highlights and guidance, and then we will attempt to answer as many of your questions, as possible. As usual, please limit questions to one question per customer and one follow-up.
So as you can see from our press release, our third quarter was an excellent quarter for Lennar, and it reflects the robust state of the housing market across the country. Inventories are limited and demand remained strong, driven by low interest rates and customer focus on owning and controlling their lifestyle. Our solid sales growth rate of 16% year-over-year, which is well in excess of our targeted growth rate of 4% to 7%, reflects excellent execution of a very disciplined approach to sales pace.
As we witnessed, lumber prices accelerate throughout the quarter, we deliberately sold today's current inventory and limited sales on tomorrow's yet to be started homes. Our strategy in the current market condition is to be patient with longer-term sales and enable price appreciation to offset future cost escalation and maximize margin, while selling only more current inventory improves our inventory turns. Simply put,