EX-99 2 ex99-1.htm EXHIBIT 99.1

ex99-1.htm

Exhibit 99.1

HOVNANIAN ENTERPRISES, INC. News Release

Contact:	J. Larry Sorsby	Jeffrey T. O’Keefe
	Executive Vice President & CFO	Vice President, Investor Relations
	732-747-7800	732-747-7800

HOVNANIAN ENTERPRISES REPORTS fiscal 2013 Third quarter Results

RED BANK, NJ, September 9, 2013 – Hovnanian Enterprises, Inc. (NYSE: HOV), a leading national homebuilder, reported results for its third quarter and nine months ended July 31, 2013.

RESULTS FOR the THREE and NINE MONTH PERIODs ENDED JULY 31, 2013:

● Total revenues were $478.4 million for the third quarter of fiscal 2013 up 23.6% compared with $387.0 million in the third quarter of the prior year. For the nine months ended July 31, 2013, total revenues increased 26.2% to $1.26 billion compared with $998.3 million in last year’s first nine months.

● Homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, increased 210 basis points to 20.3% during the third quarter of 2013 compared with 18.2% in the same period of the prior year, and was up 140 basis points compared to the 18.9% reported for the second quarter of 2013.

● For the nine months ended July 31, 2013, homebuilding gross margin percentage, before interest expense and land charges included in cost of sales, was 18.9% compared with 17.5% during the same period a year ago.

● Pre-tax income during the fiscal 2013 third quarter was $11.0 million, excluding land-related charges and gain on extinguishment of debt, compared with a pre-tax loss of $7.4 million in last year’s third quarter.

● In the first nine months of fiscal 2013, the pre-tax loss, excluding land-related charges, expenses associated with the debt exchange offer and gain on extinguishment of debt, was $8.2 million compared with a pre-tax loss of $63.1 million in the prior year’s first nine months.

● Net income was $8.5 million, or $0.06 per common share, during the third quarter of 2013, compared with $34.7 million, which included a $36.5 million income tax benefit and $6.2 million gain on extinguishment of debt, or $0.25 per common share, in the third quarter of fiscal 2012.

● For the nine months ended July 31, 2013, the net loss was $1.5 million, or $0.01 per common share, compared with net income of $18.2 million, which included a $35.3 million income tax benefit and $58.0 million gain on extinguishment of debt, or $0.15 per common share, in the first nine months of fiscal 2012.

● Deliveries, including unconsolidated joint ventures, were 1,502 homes for the fiscal 2013 third quarter, up 8.3% compared with 1,387 homes during the third quarter of 2012. For the nine months ended July 31, 2013, deliveries, including unconsolidated joint ventures, were 4,114 homes compared with 3,606 homes in the first nine months of 2012, an increase of 14.1%.

● The dollar value of net contracts, including unconsolidated joint ventures, for the three months ended July 31, 2013 increased 7.9% to $546.9 million compared with $507.0 million in the third quarter of the prior year. The number of net contracts increased 1.8% to 1,568 homes in the third quarter of 2013 from 1,541 homes in the 2012 third quarter.

● The dollar value of net contracts, including unconsolidated joint ventures, for the first nine months of fiscal 2013 increased 21.6% to $1.71 billion compared with $1.40 billion in first nine months of the prior year. The number of net contracts increased 10.6% to 4,862 homes for the nine months ended July 31, 2013 from 4,395 homes in the first nine months last year.

● Contract backlog, as of July 31, 2013, including unconsolidated joint ventures, was $1.03 billion for 2,893 homes, which was an increase of 26.8% and 18.0%, respectively, compared to July 31, 2012.

● Total SG&A was $56.4 million, or 11.8% of total revenues, during the fiscal 2013 third quarter compared to $48.1 million, or 12.4% of total revenues, in last year’s third quarter. In the first nine months of fiscal 2013, total SG&A was $157.2 million, or 12.5% of total revenues, compared with $141.6 million or 14.2% of total revenues in first nine months of the prior year.

● Total interest expense as a percentage of total revenues declined 250 basis points to 7.5% in the third quarter of 2013 compared with 10.0% in the 2012 third quarter. For the nine months ended July 31, 2013, total interest expense as a percentage of total revenues declined 310 basis points to 8.2% compared with 11.3% in the first nine months of the prior year.

● Adjusted EBITDA increased to $48.6 million for the third quarter of fiscal 2013 compared to $33.9 million in the third quarter of the prior year. For the nine months ended July 31, 2013, Adjusted EBITDA was $102.2 million compared with $57.2 million in last year’s first nine months.

● The contract cancellation rate, including unconsolidated joint ventures, during the third quarter of 2013 was 18%, compared with 21% in the same period of the prior year.

● The valuation allowance was $941.1 million as of July 31, 2013. The valuation allowance is a non-cash reserve against the tax assets for GAAP purposes. For tax purposes, the tax deductions associated with the tax assets may be carried forward for 20 years from the date the deductions were incurred.

LIQUIDITY AND INVENTORY AS OF JULY 31, 2013:

● During the third quarter of 2013, $147.7 million was spent on land and land development compared with an average quarterly land and land development spend of $115.0 million for each of the first two quarters of fiscal 2013. Homebuilding cash was $226.7 million as of July 31, 2013, including $5.2 million of restricted cash required to collateralize letters of credit.

● As of July 31, 2013, the land position, including unconsolidated joint ventures, was 32,523 lots, consisting of 14,224 lots under option and 18,299 owned lots, compared with a total of 29,089 lots as of July 31, 2012.

COMMENTS FROM MANAGEMENT:

“We were pleased that we were able to raise home prices, grow revenues and increase our gross margin during the third quarter of fiscal 2013,” stated Ara K. Hovnanian, Chairman of the Board, President and Chief Executive Officer. “Our emphasis on raising home prices combined with concerns over rising mortgage rates and weakened consumer confidence dampened our home sales during July and August of 2013. We believe we are in a period where consumers are adjusting to current home prices and mortgage rates and remain confident that the combination of pent-up housing demand and the positive long-term demographic trends for housing will drive increased demand for new homes going forward. We continue to project profitability for the full fiscal 2013 year and strong results for our fourth quarter, excluding any expenses related to early retirement of debt,” concluded Mr. Hovnanian.

“We ended the third quarter of fiscal 2013 with $227 million of homebuilding cash,” said J. Larry Sorsby, Executive Vice President and Chief Financial Officer. “During the third quarter, we increased our liquidity beyond the cash we have on hand with the addition of a $75 million revolving credit facility, providing us with increased financial flexibility. This additional liquidity will allow us to invest in even more new land parcels and increase further our participation in the housing industry’s recovery,” concluded Mr. Sorsby.

Webcast Information:

Hovnanian Enterprises will webcast its fiscal 2013 third quarter financial results conference call at 11:00 a.m. E.T. on Monday, September 9, 2013. The webcast can be accessed live through the “Investor Relations” section of Hovnanian Enterprises’ Website at http://www.khov.com. For those who are not available to listen to the live webcast, an archive of the broadcast will be available under the “Audio Archives” section of the Investor Relations page on the Hovnanian Website at http://www.khov.com. The archive will be available for 12 months.

About Hovnanian Enterprises^®, Inc.:

Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, is headquartered in Red Bank, New Jersey. The Company is one of the nation’s largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Maryland, Minnesota, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and West Virginia. The Company’s homes are marketed and sold under the trade names K. Hovnanian^® Homes^®, Brighton Homes, Parkwood Builders, Town & Country Homes and Oster Homes. As the developer of K. Hovnanian’s^® Four Seasons communities, the Company is also one of the nation’s largest builders of active adult homes.

Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company’s 2012 annual report, can be accessed through the “Investor Relations” section of the Hovnanian Enterprises’ website at http://www.khov.com. To be added to Hovnanian's investor e-mail or fax lists, please send an e-mail to IR@khov.com or sign up at http://www.khov.com.

NON-GAAP FINANCIAL MEASURES:

Consolidated earnings before interest expense and income taxes (“EBIT”) and before depreciation and amortization (“EBITDA”) and before inventory impairment loss and land option write-offs, expenses associated with debt exchange offer and gain on extinguishment of debt (“Adjusted EBITDA”) are not U.S. generally accepted accounting principles (GAAP) financial measures. The most directly comparable GAAP financial measure is net income (loss). The reconciliation of EBIT, EBITDA and Adjusted EBITDA to net income (loss) is presented in a table attached to this earnings release.

Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Gain on Extinguishment of Debt is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Income (Loss) Before Income Taxes. The reconciliation of Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Gain on Extinguishment of Debt to Income (Loss) Before Income Taxes is presented in a table attached to this earnings release.

FORWARD-LOOKING STATEMENTS

All statements in this press release that are not historical facts should be considered as “forward-looking statements.” Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Although we believe that our plans, intentions and expectations reflected in, or suggested by, such forward looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic, industry and business conditions and impacts of the sustained homebuilding downturn, (2) adverse weather and other environmental conditions and natural disasters, (3) changes in market conditions and seasonality of the Company’s business, (4) changes in home prices and sales activity in the markets where the Company builds homes, (5) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, tax laws, and the environment, (6) fluctuations in interest rates and the availability of mortgage financing, (7) shortages in, and price fluctuations of, raw materials and labor, (8) the availability and cost of suitable land and improved lots, (9) levels of competition, (10) availability of financing to the Company, (11) utility shortages and outages or rate fluctuations, (12) levels of indebtedness and restrictions on the Company’s operations and activities imposed by the agreements governing the Company’s outstanding indebtedness, (13) the Company's sources of liquidity, (14) changes in credit ratings, (15) availability of net operating loss carryforwards, (16) operations through joint ventures with third parties, (17) product liability litigation, warranty claims and claims by mortgage investors, (18) successful identification and integration of acquisitions, (19) significant influence of the Company’s controlling stockholders, (20) changes in tax laws affecting the after-tax costs of owning a home, (21) geopolitical risks, terrorist acts and other acts of war, and (22) other factors described in detail in the Company’s Annual Report on Form 10-K for the year ended October 31, 2012. Except as otherwise required by applicable securities laws, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances or any other reason.

(Financial Tables Follow)

Hovnanian Enterprises, Inc.

July 31, 2013

Statements of Consolidated Operations

(Dollars in Thousands, Except Per Share Data)

		Three Months Ended								Nine Months Ended
		July 31,								July 31,
		2013				2012				2013				2012
		(Unaudited)								(Unaudited)
Total Revenues			$478,357				$387,011				$1,259,566				$998,309
Costs and Expenses (a)			471,659				395,910				1,278,051				1,075,640
Gain on Extinguishment of Debt			-				6,230				-				57,966
Income from Unconsolidated Joint Ventures			3,690				852				6,806				2,324
Income (Loss) Before Income Taxes			10,388				(1,817	)			(11,679	)			(17,041	)
Income Tax Provision (Benefit)			1,922				(36,493	)			(10,155	)			(35,254	)
Net Income (Loss)			$8,466				$34,676				$(1,524	)			$18,213
Per Share Data:
Basic:
Income (Loss) Per Common Share			$0.06				$0.25				$(0.01	)			$0.15
Weighted Average Number of Common Shares Outstanding (b)			146,056				138,472				144,840				121,357
Assuming Dilution:
Income (Loss) Per Common Share			$0.06				$0.25				$(0.01	)			$0.15
Weighted Average Number of Common Shares Outstanding (b)			162,823				138,552				144,840				121,380

(a) Includes inventory impairment loss and land option write-offs.

(b) For periods with a net loss, basic shares are used in accordance with GAAP rules.

Hovnanian Enterprises, Inc.

July 31, 2013

Reconciliation of Income (Loss) Before Income Taxes Excluding Land-Related

Charges, Expenses Associated with the Debt Exchange Offer and

Gain on Extinguishment of Debt to Income (Loss) Before Income Taxes

(Dollars in Thousands)

		Three Months Ended								Nine Months Ended
		July 31,								July 31,
		2013				2012				2013				2012
		(Unaudited)								(Unaudited)
Income (Loss) Before Income Taxes			$10,388				$(1,817	)			$(11,679	)			$(17,041	)
Inventory Impairment Loss and Land Option Write-Offs			623				689				3,479				7,230
Expenses Associated with the Debt Exchange Offer			-				-				-				4,683
Gain on Extinguishment of Debt			-				(6,230	)			-				(57,966	)
Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Gain on Extinguishment of Debt (a)			$11,011				$(7,358	)			$(8,200	)			$(63,094	)

(a) Income (Loss) Before Income Taxes Excluding Land-Related Charges, Expenses Associated with the Debt Exchange Offer and Gain on Extinguishment of Debt is a non-GAAP Financial measure. The most directly comparable GAAP financial measure is Income (Loss) Before Income Taxes.

Hovnanian Enterprises, Inc.

July 31, 2013

Gross Margin

(Dollars in Thousands)

		Homebuilding Gross Margin								Homebuilding Gross Margin
		Three Months Ended								Nine Months Ended
		July 31,								July 31,
		2013				2012				2013				2012
		(Unaudited)								(Unaudited)
Sale of Homes			$462,376				$371,481				$1,206,233				$936,305
Cost of Sales, Excluding Interest (a)			368,617				303,760				978,309				772,368
Homebuilding Gross Margin, Excluding Interest			93,759				67,721				227,924				163,937
Homebuilding Cost of Sales Interest			13,702				14,178				35,089				34,829
Homebuilding Gross Margin, Including Interest			$80,057				$53,543				$192,835				$129,108
Gross Margin Percentage, Excluding Interest			20.3	%			18.2	%			18.9	%			17.5	%
Gross Margin Percentage, Including Interest			17.3	%			14.4	%			16.0	%			13.8	%

		Land Sales Gross Margin								Land Sales Gross Margin
		Three Months Ended								Nine Months Ended
		July 31,								July 31,
		2013				2012				2013				2012
		(Unaudited)								(Unaudited)
Land Sales			$1,940				$1,823				$15,218				$28,737
Cost of Sales, Excluding Interest (a)			1,847				1,418				14,053				21,800
Land Sales Gross Margin, Excluding Interest			93				405				1,165				6,937
Land Sales Interest			55				120				222				5,262
Land Sales Gross Margin, Including Interest			$38				$285				$943				$1,675

(a) Does not include cost associated with walking away from land options or inventory impairment losses which are recorded as Inventory impairment loss and land option write-offs in the Condensed Consolidated Statements of Operations.

Hovnanian Enterprises, Inc.

July 31, 2013

Reconciliation of Adjusted EBITDA to Net Income (Loss)

(Dollars in Thousands)

			Three Months Ended July 31,								Nine Months Ended July 31,
			2013				2012				2013				2012
			(Unaudited)								(Unaudited)
Net Income (Loss)			$8,466				$34,676				$(1,524	)			$18,213
Income Tax Provision (Benefit)			1,922				(36,493	)			(10,155	)			(35,254	)
Interest Expense			35,706				38,888				103,892				112,732
EBIT (a)			46,094				37,071				92,213				95,691
Depreciation			938				1,494				3,782				4,711
Amortization of Debt Costs			907				912				2,718				2,808
EBITDA (b)			47,939				39,477				98,713				103,210
Inventory Impairment Loss and Land Option Write-offs			623				689				3,479				7,230
Expenses Associated with Debt Exchange Offer			-				-				-				4,683
Gain on Extinguishment of Debt			-				(6,230	)			-				(57,966	)
Adjusted EBITDA (c)			$48,562				$33,936				$102,192				$57,157
Interest Incurred			$33,195				$39,477				$97,813				$110,315
Adjusted EBITDA to Interest Incurred			1.46				0.86				1.04				0.52

(a) EBIT is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net income (loss). EBIT represents earnings before interest expense and income taxes.

(b) EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net income (loss). EBITDA represents earnings before interest expense, income taxes, depreciation and amortization.

(c) Adjusted EBITDA is a non-GAAP financial measure. The most directly comparable GAAP financial measure is net income (loss). Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation, amortization, inventory impairment loss and land option write-offs, expenses associated with debt exchange offer, and gain on extinguishment of debt.

Hovnanian Enterprises, Inc.

July 31, 2013

Interest Incurred, Expensed and Capitalized

(Dollars in Thousands)

		Three Months Ended								Nine Months Ended
		July 31,								July 31,
		2013				2012				2013				2012
		(Unaudited)								(Unaudited)
Interest Capitalized at Beginning of Period			$112,488				$118,435				$116,056				$121,441
Plus Interest Incurred			33,195				39,477				97,813				110,315
Less Interest Expensed			35,706				38,888				103,892				112,732
Interest Capitalized at End of Period (a)			$109,977				$119,024				$109,977				$119,024

(a) Capitalized interest amounts are shown gross before allocating any portion of impairments to capitalized interest.

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands)

		July 31, 2013				October 31, 2012
		(Unaudited)				(1)
ASSETS
Homebuilding:
Cash			$221,500				$258,323
Restricted cash and cash equivalents			11,085				41,732
Inventories:
Sold and unsold homes and lots under development			755,496				671,851
Land and land options held for future development or sale			252,847				218,996
Consolidated inventory not owned			109,665				90,619
Total inventories			1,118,008				981,466
Investments in and advances to unconsolidated joint ventures			54,346				61,083
Receivables, deposits, and notes – net			47,542				61,794
Property, plant, and equipment – net			46,906				48,524
Prepaid expenses and other assets			59,981				66,694
Total homebuilding			1,559,368				1,519,616
Financial services:
Cash			5,758				14,909
Restricted cash and cash equivalents			12,935				22,470
Mortgage loans held for sale at fair value			84,026				117,024
Other assets			2,039				10,231
Total financial services			104,758				164,634
Total assets			$1,664,126				$1,684,250

(1) Derived from the audited balance sheet as of October 31, 2012.

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands Except Share and Per Share Amounts)

		July 31, 2013				October 31, 2012
		(Unaudited)				(1)
LIABILITIES AND EQUITY
Homebuilding:
Nonrecourse mortgages			$55,286				$38,302
Accounts payable and other liabilities			289,496				296,510
Customers’ deposits			37,922				23,846
Nonrecourse mortgages secured by operating properties			18,000				18,775
Liabilities from inventory not owned			94,484				77,791
Total homebuilding			495,188				455,224
Financial services:
Accounts payable and other liabilities			23,690				37,609
Mortgage warehouse lines of credit			57,452				107,485
Total financial services			81,142				145,094
Notes payable:
Senior secured notes			978,295				977,369
Senior notes			459,145				458,736
Senior amortizing notes			20,857				23,149
Senior exchangeable notes			65,772				76,851
TEU senior subordinated amortizing notes			3,181				6,091
Accrued interest			25,002				20,199
Total notes payable			1,552,252				1,562,395
Income taxes payable			2,748				6,882
Total liabilities			2,131,330				2,169,595
Equity:
Hovnanian Enterprises, Inc. stockholders’ equity deficit:
Preferred stock, $.01 par value - authorized 100,000 shares; issued 5,600 shares with a liquidation preference of $140,000 at July 31, 2013 and at October 31, 2012			135,299				135,299
Common stock, Class A, $.01 par value – authorized 400,000,000 shares; issued 136,305,223 shares at July 31, 2013 and 130,055,304 shares at October 31, 2012 (including 11,760,763 shares at July 31, 2013 and October 31, 2012 held in Treasury)			1,363				1,300
Common stock, Class B, $.01 par value (convertible to Class A at time of sale) – authorized 60,000,000 shares; issued 15,348,615 shares at July 31, 2013 and 15,350,101 shares at October 31, 2012 (including 691,748 shares at July 31, 2013 and October 31, 2012 held in Treasury)			153				154
Paid in capital - common stock			688,145				668,735
Accumulated deficit			(1,177,227	)			(1,175,703	)
Treasury stock - at cost			(115,360	)			(115,360	)
Total Hovnanian Enterprises, Inc. stockholders’ equity deficit			(467,627	)			(485,575	)
Noncontrolling interest in consolidated joint ventures			423				230
Total equity deficit			(467,204	)			(485,345	)
Total liabilities and equity			$1,664,126				$1,684,250

(1) Derived from the audited balance sheet as of October 31, 2012.

HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands Except Per Share Data)

(Unaudited)

		Three Months Ended								Nine Months Ended
		July 31,								July 31,
		2013				2012				2013				2012
Revenues:
Homebuilding:
Sale of homes			$462,376				$371,481				$1,206,233				$936,305
Land sales and other revenues			3,103				4,743				18,114				36,014
Total homebuilding			465,479				376,224				1,224,347				972,319
Financial services			12,878				10,787				35,219				25,990
Total revenues			478,357				387,011				1,259,566				998,309
Expenses:
Homebuilding:
Cost of sales, excluding interest			370,464				305,178				992,362				794,168
Cost of sales interest			13,757				14,298				35,311				40,091
Inventory impairment loss and land option write-offs			623				689				3,479				7,230
Total cost of sales			384,844				320,165				1,031,152				841,489
Selling, general and administrative			42,331				36,230				116,904				104,609
Total homebuilding expenses			427,175				356,395				1,148,056				946,098
Financial services			6,640				6,111				21,205				16,651
Corporate general and administrative			14,056				11,913				40,284				36,961
Other interest			21,949				24,590				68,581				72,641
Other operations			1,839				(3,099	)			(75	)			3,289
Total expenses			471,659				395,910				1,278,051				1,075,640
Gain on extinguishment of debt			-				6,230				-				57,966
Income from unconsolidated joint ventures			3,690				852				6,806				2,324
Income (loss) before income taxes			10,388				(1,817	)			(11,679	)			(17,041	)
State and federal income tax provision (benefit):
State			1,922				(36,563	)			(277	)			(35,461	)
Federal			-				70				(9,878	)			207
Total income taxes			1,922				(36,493	)			(10,155	)			(35,254	)
Net income (loss)			$8,466				$34,676				$(1,524	)			$18,213
Per share data:
Basic:
Income (loss) per common share			$0.06				$0.25				$(0.01	)			$0.15
Weighted-average number of common shares outstanding			146,056				138,472				144,840				121,357
Assuming dilution:
Income (loss) per common share			$0.06				$0.25				$(0.01	)			$0.15
Weighted-average number of common shares outstanding			162,823				138,552				144,840				121,380

HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)															Communities Under Development
(UNAUDITED)															Three Months - July 31, 2013
			Net Contracts (1) Three Months Ended Jul 31,												Deliveries Three Months Ended Jul 31,												Contract Backlog Jul 31,
			2013				2012				% Change				2013				2012				% Change				2013				2012				% Change
Northeast
(includes unconsolidated joint ventures)	Home			148				160				(7.5	)%			186				206				(9.7	)%			326				322				1.2	%
(NJ, PA)	Dollars			$74,012				$82,295				(10.1	)%			$91,663				$104,403				(12.2	)%			$160,826				$155,056				3.7	%
	Avg. Price			$500,083				$514,341				(2.8	)%			$492,813				$506,811				(2.8	)%			$493,331				$481,540				2.4	%
Mid-Atlantic
(includes unconsolidated joint ventures)	Home			194				189				2.6	%			256				223				14.8	%			419				438				(4.3	)%
(DE, MD, VA, WV)	Dollars			$96,977				$82,805				17.1	%			$119,698				$92,484				29.4	%			$209,207				$189,875				10.2	%
	Avg. Price			$499,881				$438,124				14.1	%			$467,569				$414,726				12.7	%			$499,300				$433,505				15.2	%
Midwest
(includes unconsolidated joint ventures)	Home			258				208				24.0	%			184				160				15.0	%			691				538				28.4	%
(IL, MN, OH)	Dollars			$64,484				$53,425				20.7	%			$46,329				$36,688				26.3	%			$168,220				$123,274				36.5	%
	Avg. Price			$249,936				$256,853				(2.7	)%			$251,785				$229,300				9.8	%			$243,444				$229,133				6.2	%
Southeast
(includes unconsolidated joint ventures)	Home			217				175				24.0	%			153				121				26.4	%			436				310				40.6	%
(FL, GA, NC, SC)	Dollars			$68,528				$45,783				49.7	%			$43,310				$30,305				42.9	%			$132,383				$80,384				64.7	%
	Avg. Price			$315,799				$261,615				20.7	%			$283,075				$250,455				13.0	%			$303,631				$259,304				17.1	%
Southwest
(includes unconsolidated joint ventures)	Home			663				614				8.0	%			606				529				14.6	%			882				635				38.9	%
(AZ, TX)	Dollars			$195,403				$166,120				17.6	%			$181,593				$139,407				30.3	%			$287,719				$180,660				59.3	%
	Avg. Price			$294,726				$270,553				8.9	%			$299,658				$263,529				13.7	%			$326,212				$284,505				14.7	%
West
(includes unconsolidated joint ventures)	Home			88				195				(54.9	)%			117				148				(20.9	)%			139				209				(33.5	)%
(CA)	Dollars			$47,470				$76,522				(38.0	)%			$56,474				$57,498				(1.8	)%			$74,004				$84,677				(12.6	)%
	Avg. Price			$539,432				$392,421				37.5	%			$482,685				$388,500				24.2	%			$532,405				$405,150				31.4	%
Grand Total
	Home			1,568				1,541				1.8	%			1,502				1,387				8.3	%			2,893				2,452				18.0	%
	Dollars			$546,874				$506,950				7.9	%			$539,067				$460,785				17.0	%			$1,032,359				$813,926				26.8	%
	Avg. Price			$348,772				$328,974				6.0	%			$358,899				$332,217				8.0	%			$356,847				$331,944				7.5	%
Consolidated Total
	Home			1,448				1,382				4.8	%			1,341				1,212				10.6	%			2,569				2,132				20.5	%
	Dollars			$494,594				$423,396				16.8	%			$462,376				$371,481				24.5	%			$897,186				$674,159				33.1	%
	Avg. Price			$341,571				$306,365				11.5	%			$344,800				$306,502				12.5	%			$349,236				$316,210				10.4	%
Unconsolidated Joint Ventures
	Home			120				159				(24.5	)%			161				175				(8.0	)%			324				320				1.3	%
	Dollars			$52,280				$83,554				(37.4	)%			$76,691				$89,304				(14.1	)%			$135,173				$139,767				(3.3	)%
	Avg. Price			$435,667				$525,494				(17.1	)%			$476,339				$510,309				(6.7	)%			$417,201				$436,770				(4.5	)%

DELIVERIES INCLUDE EXTRAS

Notes:

(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.

HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)															Communities Under Development
(UNAUDITED)															Nine Months - July 31, 2013
			Net Contracts (1) Nine Months Ended Jul 31,												Deliveries Nine Months Ended Jul 31,												Contract Backlog Jul 31,
			2013				2012				% Change				2013				2012				% Change				2013				2012				% Change
Northeast
(includes unconsolidated joint ventures)	Home			497				472				5.3	%			465				516				(9.9	)%			326				322				1.2	%
(NJ, PA)	Dollars			$254,210				$239,378				6.2	%			$234,338				$255,705				(8.4	)%			$160,826				$155,056				3.7	%
	Avg. Price			$511,490				$507,157				0.9	%			$503,953				$495,552				1.7	%			$493,331				$481,540				2.4	%
Mid-Atlantic
(includes unconsolidated joint ventures)	Home			699				625				11.8	%			646				557				16.0	%			419				438				(4.3	)%
(DE, MD, VA, WV)	Dollars			$335,076				$263,575				27.1	%			$289,068				$227,540				27.0	%			$209,207				$189,875				10.2	%
	Avg. Price			$479,365				$421,720				13.7	%			$447,474				$408,508				9.5	%			$499,300				$433,505				15.2	%
Midwest
(includes unconsolidated joint ventures)	Home			730				638				14.4	%			538				400				34.5	%			691				538				28.4	%
(IL, MN, OH)	Dollars			$186,336				$148,245				25.7	%			$134,034				$92,140				45.5	%			$168,220				$123,274				36.5	%
	Avg. Price			$255,254				$232,360				9.9	%			$249,134				$230,350				8.2	%			$243,444				$229,133				6.2	%
Southeast
(includes unconsolidated joint ventures)	Home			590				484				21.9	%			437				342				27.8	%			436				310				40.6	%
(FL, GA, NC, SC)	Dollars			$175,073				$122,269				43.2	%			$122,030				$85,326				43.0	%			$132,383				$80,384				64.7	%
	Avg. Price			$296,733				$252,622				17.5	%			$279,245				$249,491				11.9	%			$303,631				$259,304				17.1	%
Southwest
(includes unconsolidated joint ventures)	Home			2,001				1,667				20.0	%			1,625				1,363				19.2	%			882				635				38.9	%
(AZ, TX)	Dollars			$590,189				$436,508				35.2	%			$463,309				$344,844				34.4	%			$287,719				$180,660				59.3	%
	Avg. Price			$294,947				$261,852				12.6	%			$285,113				$253,004				12.7	%			$326,212				$284,505				14.7	%
West
(includes unconsolidated joint ventures)	Home			345				509				(32.2	)%			403				428				(5.8	)%			139				209				(33.5	)%
(CA)	Dollars			$165,289				$192,723				(14.2	)%			$173,258				$149,520				15.9	%			$74,004				$84,677				(12.6	)%
	Avg. Price			$479,099				$378,630				26.5	%			$429,921				$349,346				23.1	%			$532,405				$405,150				31.4	%
Grand Total
	Home			4,862				4,395				10.6	%			4,114				3,606				14.1	%			2,893				2,452				18.0	%
	Dollars			$1,706,173				$1,402,698				21.6	%			$1,416,037				$1,155,075				22.6	%			$1,032,359				$813,926				26.8	%
	Avg. Price			$350,920				$319,158				10.0	%			$344,200				$320,320				7.5	%			$356,847				$331,944				7.5	%
Consolidated Total
	Home			4,338				3,848				12.7	%			3,658				3,144				16.3	%			2,569				2,132				20.5	%
	Dollars			$1,471,102				$1,138,104				29.3	%			$1,206,233				$936,305				28.8	%			$897,186				$674,159				33.1	%
	Avg. Price			$339,120				$295,765				14.7	%			$329,752				$297,807				10.7	%			$349,236				$316,210				10.4	%
Unconsolidated Joint Ventures
	Home			524				547				(4.2	)%			456				462				(1.3	)%			324				320				1.3	%
	Dollars			$235,071				$264,594				(11.2	)%			$209,804				$218,770				(4.1	)%			$135,173				$139,767				(3.3	)%
	Avg. Price			$448,607				$483,718				(7.3	)%			$460,095				$473,528				(2.8	)%			$417,201				$436,770				(4.5	)%

DELIVERIES INCLUDE EXTRAS

Notes:

(1) Net contracts are defined as new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.