v3.25.4

Note 10 - Operating and Reporting Segments | 12 Months Ended
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Oct. 31, 2025
Operating and Reporting Segments |
Operating and Reporting Segments | 10. Operating and Reporting Segments HEI’s operating segments are components of the Company’s business for which discrete financial information is available and reviewed regularly by the chief operating decision maker, our Chief Executive Officer, to evaluate performance, make resource allocations and guide strategic decisions. The Chief Executive Officer uses income (loss) before income taxes as the key operating metric used to measure segment profit or loss. Actual income (loss) before income taxes is reviewed monthly against budgeted amounts from the semi-annual financial plans. We currently have homebuilding operations in 13 states that are aggregated into reportable segments based primarily upon geographic proximity. HEI’s reportable segments consist of the following three homebuilding segments and a financial services segment. Homebuilding:
| (1) | Northeast (Delaware, Maryland, New Jersey, Ohio, Pennsylvania, Virginia and West Virginia)
| (2) | Southeast (Florida, Georgia and South Carolina)
| (3) | West (Arizona, California and Texas)
Operations of the homebuilding segments primarily include the sale and construction of single-family attached and detached homes, attached townhomes and condominiums, urban infill and active lifestyle homes in planned residential developments. In addition, from time to time, operations of the homebuilding segments include sales of land. Operations of the financial services segment include mortgage banking and title services provided to the homebuilding operations’ customers. Our financial services subsidiaries do not typically retain or service mortgages that we originate but sell the mortgages and related servicing rights to investors. Financial information relating to our reportable segments are as follows:
| Year Ended October 31, 2025 |
(In thousands) |  | Northeast |  |  |  | Southeast |  |  |  | West |  |  |  | Financial Services |  |  |  | Total |
Homebuilding revenues | $ | 1,146,746 |  |  | $ | 349,448 |  |  | $ | 1,356,714 |  |  | $ | - |  |  | $ | 2,852,908 |
Financial services revenues |  | - |  |  |  | - |  |  |  | - |  |  |  | 94,975 |  |  |  | 94,975 |
All other revenues (1) |  | 4,895 |  |  |  | 532 |  |  |  | 20,359 |  |  |  | - |  |  |  | 25,786 |
Total |  | 1,151,641 |  |  |  | 349,980 |  |  |  | 1,377,073 |  |  |  | 94,975 |  |  |  | 2,973,669 |
Cost of sales (2) |  | 945,566 |  |  |  | 308,978 |  |  |  | 1,243,226 |  |  |  | - |  |  |  | 2,497,770 |
Selling, general and administrative |  | 63,117 |  |  |  | 33,970 |  |  |  | 97,685 |  |  |  | - |  |  |  | 194,772 |
Financial services expenses |  | - |  |  |  | - |  |  |  | - |  |  |  | 56,001 |  |  |  | 56,001 |
Other segment items (3) |  | (22,572 | ) |  |  | (8,427 | ) |  |  | 21,047 |  |  |  | - |  |  |  | (9,952 | )
Total segment profit | $ | 165,530 |  |  | $ | 15,459 |  |  | $ | 15,115 |  |  | $ | 38,974 |  |  | $ | 235,078 |
Corporate and unallocated (4) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 148,991 |
Income before income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 86,087 |
| Year Ended October 31, 2024 |
(In thousands) |  | Northeast |  |  |  | Southeast |  |  |  | West |  |  |  | Financial Services |  |  |  | Total |
Homebuilding revenues | $ | 1,007,595 |  |  | $ | 447,804 |  |  | $ | 1,420,088 |  |  | $ | - |  |  | $ | 2,875,487 |
Financial services revenues |  | - |  |  |  | - |  |  |  | - |  |  |  | 74,064 |  |  |  | 74,064 |
All other revenues (1) |  | 28,453 |  |  |  | 1,098 |  |  |  | 17,806 |  |  |  | - |  |  |  | 47,357 |
Total |  | 1,036,048 |  |  |  | 448,902 |  |  |  | 1,437,894 |  |  |  | 74,064 |  |  |  | 2,996,908 |
Cost of sales (2) |  | 799,549 |  |  |  | 351,152 |  |  |  | 1,214,675 |  |  |  | - |  |  |  | 2,365,376 |
Selling, general and administrative |  | 62,665 |  |  |  | 34,607 |  |  |  | 85,317 |  |  |  | - |  |  |  | 182,589 |
Financial services expenses |  | - |  |  |  | - |  |  |  | - |  |  |  | 49,940 |  |  |  | 49,940 |
Other segment items (3) |  | (17,219 | ) |  |  | (14,532 | ) |  |  | 11,189 |  |  |  | - |  |  |  | (20,562 | )
Total segment profit | $ | 191,053 |  |  | $ | 77,675 |  |  | $ | 126,713 |  |  | $ | 24,124 |  |  | $ | 419,565 |
Corporate and unallocated (4) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 102,476 |
Income before income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 317,089 |
| Year Ended October 31, 2023 |
(In thousands) |  | Northeast |  |  |  | Southeast |  |  |  | West |  |  |  | Financial Services |  |  |  | Total |
Homebuilding revenues | $ | 933,156 |  |  | $ | 419,656 |  |  | $ | 1,277,645 |  |  | $ | - |  |  | $ | 2,630,457 |
Financial services revenues |  | - |  |  |  | - |  |  |  | - |  |  |  | 60,088 |  |  |  | 60,088 |
All other revenues (1) |  | 35,697 |  |  |  | 639 |  |  |  | 18,347 |  |  |  | - |  |  |  | 54,683 |
Total |  | 968,853 |  |  |  | 420,295 |  |  |  | 1,295,992 |  |  |  | 60,088 |  |  |  | 2,745,228 |
Cost of sales (2) |  | 740,829 |  |  |  | 323,228 |  |  |  | 1,071,256 |  |  |  | - |  |  |  | 2,135,313 |
Selling, general and administrative |  | 63,793 |  |  |  | 29,562 |  |  |  | 84,367 |  |  |  | - |  |  |  | 177,722 |
Financial services expenses |  | - |  |  |  | - |  |  |  | - |  |  |  | 40,724 |  |  |  | 40,724 |
Other segment items (3) |  | (16,033 | ) |  |  | (10,893 | ) |  |  | 21,087 |  |  |  | - |  |  |  | (5,839 | )
Total Segment Profit | $ | 180,264 |  |  | $ | 78,398 |  |  | $ | 119,282 |  |  | $ | 19,364 |  |  | $ | 397,308 |
Corporate and unallocated (4) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 141,357 |
Income before income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 255,951 |
(1) | Consists primarily of land sales revenue, interest income, and income from forfeited customer deposits due to contract cancellations.
(2) | Consists primarily of homebuilding and land sale costs, amortization of capitalized interest, inventory impairments and land option write-offs.
(3) | Consists primarily of other interest expensed, and income (loss) from unconsolidated joint ventures.
(4) | Consists primarily of corporate costs and shared services functions that are not allocated to the homebuilding or financial services reportable segments.
|  | October 31, |
(In thousands) |  | 2025 |  |  | 2024 |
Assets: |  |  |  |  |  |  |  |
Northeast |  | $ | 672,021 |  |  | $ | 664,064 |
Southeast |  |  | 358,383 |  |  |  | 296,058 |
West |  |  | 829,683 |  |  |  | 889,704 |
Financial services |  |  | 151,211 |  |  |  | 203,589 |
Total |  | $ | 2,011,298 |  |  | $ | 2,053,415 |
|  | October 31, |
(In thousands) |  | 2025 |  |  | 2024 |
Investments in and advances to unconsolidated joint ventures: |  |  |  |  |  |  |  |
Northeast |  | $ | 97,024 |  |  | $ | 79,659 |
Southeast |  |  | 29,765 |  |  |  | 55,344 |
West |  |  | 34,065 |  |  |  | 6,348 |
Total |  | $ | 160,854 |  |  | $ | 141,351 |

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