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NATURE OF OPERATIONS (Policies)
 6 Months Ended
Jun. 30, 2026
NATURE OF OPERATIONS  
Basis of Presentation

Basis of Presentation

The accompanying unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") as required by Regulation S-X, Rule 8-03. In the opinion of management, the unaudited interim financial statements have been prepared on the same basis as the audited annual financial statements, and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair statement of the Company's financial position for the periods presented. The results for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the year ending December 31, 2026, or any other period. The accompanying balance sheet as of December 31, 2025 was derived from audited financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2025 (the “Form 10-K”), filed on March 12, 2026. The accompanying financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. Accordingly, they should be read in conjunction with the audited financial statements and notes thereto included in the Form 10-K.

Use of Estimates

Use of Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Significant estimates made in connection with the accompanying financial statements primarily relate to the determination and valuation of notes receivable from mobile home parks, consumer loans receivable, other notes receivable, dealer financed receivables and fair value of financial instruments. Actual results could differ from these estimates.
Segment Reporting

Segment Reporting

The Company has one reportable segment. All of our activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the others. For example, the sale of manufactured homes includes providing transportation for dealers. We also provide financing options for customers to facilitate home sales. Accordingly, all significant operating and strategic decisions by the co-chief operating decision makers, the Executive Chairman and Chief Executive Officer, and are based upon analyses of our Company as one operating segment.

We generate revenues through the manufacture and sales of manufactured homes and “Tiny Houses” and the related interest income associated with financing these homes sales. We define the segment primarily based on how internally reported financial and operating information is regularly reviewed by our co-chief operating decision makers (“co-CODMs”) to evaluate financial performance, make decisions and allocate resources. The co-CODMs assess performance for the segment based on net income and total assets that are also reported on the statements of income and

balance sheet as net income and total assets, respectively. The accounting policies of the segment are the same as those described in the summary of significant accounting policies. The co-CODMs assess our operating and financial performance on a company-wide or consolidated basis.

On July 17, 2026, subsequent to the interim balance sheet, the Executive Chairman notified the Company of his retirement, effective July 21, 2026 (see Note 17 — Subsequent Events), and the Chief Executive Officer became the Company's sole chief operating decision maker. This change did not affect the Company's single reportable segment or the manner in which financial and operating performance is reviewed and resources are allocated.
Revenue Recognition

Revenue Recognition

Product sales primarily consist of sales of manufactured homes to consumers and mobile home parks through various sales channels, which include Direct Sales, Commercial Sales, Inventory Finance Sales, and Retail Store Sales. Direct Sales include homes sold directly to independent retailers or customers that are not financed by the Company and are not sold under an inventory finance arrangement. These types of homes are generally paid for prior to shipment. Commercial Sales include homes sold to mobile home parks under commercial loan programs or paid for upfront. Inventory Finance Sales include sales of homes to independent retailers, or dealers, who then resell the homes to consumers. Retail Store Sales are homes sold through Company-owned retail locations. Inventory Finance Sales and Retail Store Sales of homes may be financed by the Company or a third party, or they may be paid in cash.

Consumer, MHP and dealer loans interest includes interest income from the consumer, MHP and dealer finance loan portfolios. Other revenue consists of contract deposit forfeitures, consignment fees, commercial lease rents, land sales, service fees and other miscellaneous income.
Accounts Receivable

Accounts Receivable

Net accounts receivable includes receivables from direct sales of manufactured homes, sales of parts and supplies to customers, inventory finance fees and interest.

Accounts receivable related to inventory finance fees and interest generally are due upon receipt, and all other accounts receivable generally are due within 30 days. Accounts receivable is stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines the allowance by considering several factors, including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance for doubtful accounts for amounts that are deemed to be uncollectible. At June 30, 2026, December 31, 2025, and December 31, 2024, the allowance for doubtful accounts totaled $1.5 million, $1.5 million, and $0.6 million, respectively. At June 30, 2026, December 31, 2025, and December 31, 2024 accounts receivable, net was $7.0 million, $5.5 million, and $4.0 million, respectively.
Interest Receivable from Loan Portfolios

Interest Receivable from Loan Portfolios

Interest receivable loan portfolios, net relates to accrued interest for consumer loans receivable, notes receivable from mobile home parks, and other notes receivable. The interest accrual is calculated within the Company’s loan management system from the date of last customer payment received through the end of the period. Separately an interest receivable allowance is established for all interest payments past due more than 90 days. The interest receivable is stated net of the allowance. At June 30, 2026, December 31, 2025, and December 31, 2024, the interest receivable, net was $3.6 million, $3.5 million, and $3.3 million, respectively. The interest receivable is stated net of an allowance of $0.9 million and $0.7 million at June 30, 2026 and December 31, 2025, respectively.
Leased Property

Leased Property

The Company offers mobile home park operators the opportunity to lease manufactured homes for rent in lieu of purchasing the homes for cash or under a longer-term financing agreement. In this arrangement, the title for the manufactured homes remains with the Company, and the lease is accounted for as an operating lease.

Our typical lease agreement is for 96 months or 120 months. It requires the lessee to maintain the home and to return the home to us at the end of the lease in good condition. It provides the lessee with a termination option for a fee, an option to extend the lease and a purchase option at fair market value.

The leased manufactured homes are included in other assets on the Company’s balance sheet, capitalized at manufactured cost and depreciated over a 15 year useful life. Homes returned to the Company upon expiration of the lease or in the event of default are sold by the Company through its standard sales and distribution channels.

Future minimum lease income under all operating leases for each of the next five years at June 30, 2026, is as follows (in thousands):

​

​

​

​

2026

  ​ ​ ​

$

478

2027

​

 

890

2028

​

 

734

2029

​

 

469

2030

​

 

147

Thereafter

​

 

84

Total

​

$

2,802
Product Warranties

Product Warranties

The Company provides retail home buyers with a one-year warranty from the date of purchase on manufactured inventory. At this time, we do not provide any warranties with respect to “Tiny Houses”. Product warranty costs are accrued when the covered homes are sold to customers. Product warranty expense is recognized based on the terms of the product warranty and the related estimated costs. Factors used to determine the warranty liability include the number of homes under warranty and the historical costs incurred in servicing the warranties. The accrued warranty liability is reduced as costs are incurred and the warranty liability balance is included as part of accrued liabilities in the Company’s balance sheet.

The following table summarizes activity within the warranty liability (in thousands):

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Three months ended June 30, 

  ​ ​ ​

Six Months Ended June 30, 

​

​

2026

  ​ ​ ​

2025

​

2026

  ​ ​ ​

2025

Warranty liability, beginning of period

​

$

1,527

​

$

2,033

​

$

1,863

​

$

1,950

Product warranty reserve accrued

​

 

782

​

 

577

​

 

931

​

 

1,153

Warranty costs incurred

​

 

(627)

​

 

(490)

​

 

(1,112)

​

 

(983)

Warranty liability, end of period

​

$

1,682

​

$

2,120

​

$

1,682

​

$

2,120
Intangible Assets

​

Intangible Assets

Our intangible assets consist of trade name, internally developed software, customer contracts, and non-compete agreements, are considered finite-lived, and are amortized over their useful lives. Finite-lived intangibles are generally amortized over 1 to 15 years on a straight-line depreciation basis and are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. Amortization expenses recognized on intangible assets was $0.2 million and $0.5 million for the three months and six months ended June 30, 2026, respectively. Finite-lived intangibles have a weighted average remaining life of 10.1 years.

​

​

The following table shows the book value of our intangible assets, net of amortization (in thousands):

​

​

​

​

​

​

​

​

​

As of June 30, 

​

As of December 31, 

​

​

2026

​

2025

Trademarks

​

$

2,810

​

$

2,810

Developed technology

​

 

980

​

 

980

Noncompete agreement

​

​

1,180

​

 

1,180

Customer relationships

​

​

390

​

​

390

Total

​

​

5,360

​

​

5,360

Less: Accumulated Amortization

​

​

(647)

​

​

(162)

Total intangible assets

​

$

4,713

​

$

5,198

​

​

​

The following table summarizes future amortization expense related to intangible assets (in thousands):

​

​

​

​

​

​

​

As of June 30, 

Year

​

2026

2026

​

$

420

2027

​

​

580

2028

​

​

580

2029

​

​

580

2030

​

​

547

Thereafter

​

​

2,006

Total

​

$

4,713
Share-Based Compensation

Share-Based Compensation

The Company accounts for share-based compensation in accordance with the provisions of Accounting Standards Codification (“ASC”) 718, Compensation—Stock Compensation. Share-based compensation expense is recognized based on an award’s estimated grant date fair value in order to recognize compensation cost for those shares expected to vest. Compensation cost is recognized on a straight-line basis over the vesting period of the awards and adjusted as forfeitures occur. The fair value of each option grant with only service-based conditions is estimated using the Black-Scholes pricing model. The fair value of each restricted stock grant with only service-based conditions is calculated based on the closing price of the Company’s common stock on the grant date.

The fair value of stock option awards on the date of grant is estimated using the Black-Scholes option pricing model, which requires the Company to make certain predictive assumptions. The risk-free interest rate is based on the implied yield of U.S. Treasury zero-coupon securities that correspond to the expected life of the award. The volatility is estimated based on the historical volatility of the Company’s common stock. The expected life of awards granted represents the period during which the awards are expected to remain outstanding, based on the “simplified” method, which is allowed for companies that cannot reasonably estimate the expected life of options based on their historical award exercise experience. The Company does not expect to pay dividends on its common stock.

Pursuant to the Legacy Housing Corporation 2018 Incentive Compensation Plan (the “Plan”), the Company may issue up to 10.0 million equity awards to employees, directors, consultants, and nonemployee service providers in the form of stock options, stock, restricted stock, and stock appreciation rights. Stock options may be granted with a contractual life of up to ten years. At June 30, 2026, the Company had 9.2 million shares available for grant under the Plan.

As of June 30, 2026, stock options to purchase approximately 50,000 shares of common stock were outstanding under the Plan at an exercise price of $19.85, and expire on dates ranging from December 2030 to December 2035, none of which are currently exercisable. Unrecognized compensation expense related to these options at June 30, 2026 was $0.4 million and is expected to be recognized over 7.5 years. Total share-based compensation expense was immaterial for the three and six months ended June 30, 2026 and 2025.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, Income Statement Reporting - Comprehensive Income Expense - Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses. The standard update improves the disclosures about a public business entity’s expenses by requiring more detailed information about certain types of costs and expenses in the notes to the financial statements. The guidance will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The standard updates are to be applied prospectively with the option for retrospective application. The Company is currently evaluating the impact of the disclosure requirements related to the new standard on its financial statements.