Good morning. My name is Emy and I'll be your conference operator for today. At this time, I would like to welcome everyone to the United Homes Group Third Quarter 2024 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions] I would like to now turn the call over to Erin Reeves McGinnis. You may begin.

Good morning, and welcome to United Homes Group's third quarter of 2024 earnings call. Before the call begins, I would like to note this call will include forward-looking statements within the meaning of the federal securities laws. United Homes Group cautions that forward looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. These risks which change over time. These risks and uncertainties include but are not limited to, the risk factors described by United Homes Group in its filings with the Securities and Exchange Commission. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date and you should not place undue reliance on these forward-looking statements. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Additionally, reconciliations of non-GAAP financial measures discussed on this call to the most directly comparable GAAP measures can be accessed through the company's website and in its SEC filings. Hosting the call today are United Homes Group's Chief Executive Officer, Jamie Pirrello; President, Jack Micenko; and Chief Financial Officer, Keith Feldman. With that, I'd like to turn the call over to Jack.

Thank you, Aaron. Good morning and thank you everybody for joining us today as we go over our results for the third quarter 2024 and provide an update on our operations. United Homes Group delivered strong results in the quarter, highlighted by home sales revenue growth of 35% year-over-year and the 30% increase in new home deliveries. I want to thank all of our team members for their hard work in delivering a strong quarter of sales and deliveries and making improvements to our operations on a number of fronts. We continue to see positive housing fundamentals in our markets highlighted by strong local economies and migration patterns. Traffic in our communities was steady throughout the quarter, though our ability to convert traffic and orders was somewhat dictated by movements and mortgage rates. Through our use of mortgage rate buy downs and other incentives, we're able to maintain a steady cadence of orders through the quarter, culminating in a total of 341 homes sold, which represented a 25% increase over the prior year period. Given the current mortgage rate environment and seasonal slowdown, our industry typically experiences in the fourth quarter. We expect incentives to remain elevated for the remainder of the year. We made solid headway in the quarter, aligning our product to address the needs of our buyers and our markets and make sure we have sufficient inventory of homes to meet our delivery goals for this quarter and beyond. Our acquisitions of Rosewood and Creekside homes have been integrated on our home building platform. We're making progress in establishing a foothold in a relatively new market rally North Carolina. We've been hard at work transitioning United Homes from a successful private home builder into a production focused home builder with a publicly traded company mindset. Helping us execute on this strategy is our new interim CEO, Jamie Perello, who joined our company earlier this year. Jamie comes to us with a wealth of industry knowledge and experience, having most recently served as a consultant of the industry but before that as Regional President for centric communities overseeing the Southeast Texas and Florida divisions. Jamie's led a successful career across many facets of the home building industry to understand what it takes to compete effectively in the business. We're excited about adding a seasoned industry veteran like Jamie to our team and believe he has the right background experience and leadership abilities to take United Homes Group to the next level. With that, I'd like to turn the call over to Jamie, so he can give you more insight into his operational philosophy and his outlook for our company. Jamie?

Thanks, Jack. I'm thrilled to be part of the United Homes team. I look forward to the opportunities that lie ahead. I'd like to start by giving special thanks to our Founder and Executive Chairman, Michael Nieri for building an amazing company and establishing a culture that emphasizes passion, teamwork and a customer first mindset. I'm excited to build upon the foundation that Michael has set and grow United Homes into one of the premier large scale production home builders in the Southeast. We have an opportunity to build something special here. Given the favorable housing fundamentals that exist in this part of the country, people continue to migrate to the Southeast for its relative affordability, quality of life. While employers see the benefits of moving here, the business friendly climate. We believe this dynamic will be in place for the foreseeable future and provides our company with a consistent pipeline, new home buyers entering the market. Our focus will continue to be on the more affordable segments of the market, as we believe this represents the most undersupplied and highest demand aspect of housing. It's no secret that there is real need for more affordable housing in this country and we intend to capitalize on this reality. Our average sales price on production built homes in the Q3 was 320,000, which is one of the lowest ASPs of any of the publicly traded homebuilders. We've launched a number of initiatives focused on driving growth, lowering direct costs and managing overhead. We're updating our product to ensure we compete aggressively offering home designs in demand, rebidding all of our direct costs and tightly managing our overhead spend. These factors are aimed at generating positive operating leverage and improved gross margins in the future. Homebuilders are generally rewarded for achieving solid…

Thank you, Jack and Jamie, and good morning. For the Q3 of 2024, net loss was $7.3 million, which included a change in fair value of $7.8 million primarily related to the accounting for potential earn out, which will fluctuate on our financial statements each quarter based on our ending stock price. This earn out will be paid only in common shares upon reaching certain stock price hurdles and can never result in a cash expense for the company. For the nine months ended September 30, 2024, net income was $46.2 million which included a change in fair value of $50.7 million primarily related to the accounting for potential earn out liabilities. Revenue for the Q3 of 2024 was $118.6 million compared to $87.7 million for the Q3 of 2023. Revenue for the nine months ended September 30, 2024 was $328.9 million compared to $304.6 million for the nine months ended September 30, 2023. Home closings during the third quarter of 2024 were 369 homes compared to 283 homes in the third quarter of 2023. Home closings for the nine months ended September 30, 2024 were 1,017 homes compared to 996 homes for the same period in 2023. Average sales price during the third quarter of 2024 was approximately 320,000 to 369 production built homes. This compares to an average sales price of approximately 316,000 during the third quarter of 2023 for 268 production built homes. Our net new orders during the third quarter of 2024 were 341 homes compared to 272 homes in the third quarter of 2023. Net new orders for the nine months were 1,048 homes compared to 1,002 homes in 2023. Our backlog at the end of the third quarter was 220 homes with a value of approximately $79.9 million. Gross profit and gross profit margin…

Well, thank you. Jack, Keith and I would like to thank all of you for joining our call today and your interest in United Homes Group. We look forward to speaking with you in the future and our fourth quarter call in the New Year. Thank you.

This concludes today's conference call. You may now disconnect.