Good morning, everyone. I'd like to welcome everybody to Deutsche Bank's 31st Annual Leveraged Finance Conference. My name is Andrew Casella. I run the high-yield credit research team in New York, and today we're excited to have Hovnanian Enterprises join us and present Brad O'Connor, Chief Accounting Officer and Treasurer, and Jeff O'Keefe, VP Investor Relations. So with that, I'll turn it over to to you, Brad. Good morning. Thanks, Andrew. I guess we got a tough time slot this morning, but thanks for showing up. I'm going to take you through a little information on the housing market, on Hovnanian, and our recent operating results, and then we'll have some time at the end for Q&A. So starting with the housing market, some of these slides, I'm sure if you've talked to other homebuilders this week or recently, you've seen similar slides, but on the single-family housing starts side of things, you can see we have 50 years of single-family housing starts up here. The average over that time frame is around 1 million starts a year, that hash line going horizontally across. You can see leading into the Great Housing Recession, the oversupply, overbuilt that was taking place, obviously, then we had the Great Housing Recession, and since that time, we've been underproducing the average. We just ticked over it in 2021. 2022 came back down. You can see where we are, 2023, through August on a year-to-date seasonally adjusted basis, we'll be at- we're at 907,000, so under the 1 million. So there's still, you know, an undersupply of single-family housing starts. And then along with that, currently, as many of you have, I'm sure, read about, heard about, maybe are living themselves, as I was talking to Andrew about it, but historically low supply of existing homes for sale. You've got people that are locked in at their 3% or less mortgage rates. Makes it very challenging to move and accept a much higher rate now in the current environment. And so you can see, leading into the Great Housing Recession, there were 3.4 million homes, and that was a peak, that were available for sale, existing homes. The average over this time frame is 2.1 million, and when you can see, we're under 1 million currently and have been for a while. And I think that's obviously helping the new home builders in terms of availability of homes for those that are willing and able to purchase, there's really only new homes for sale to choose from. Mortgage rates, this shows you on a long-term perspective, what mortgage rates have been doing, 30-year fixed rate. You can see, you know, going way back, how high it got, almost to 20%. But then, very recently, we've had the benefit of very low, low rates, 3% or less. And then last May, as we all know, the rates dramatically jumped to around 6%. The market slowed pretty dramatically for us and all the home builders for a period of time as people adjusted to the lower rates. And then rates have continued to tick up, and I know they're up even more this week. So, you know, it's not helpful when rates go up, certainly for us or others. We have ways to combat that, that existing home sellers don't necessarily have in terms of being able to buy down rates. So we're able to give our customers, you know, better rates than what you're seeing here at a cost. But, you know, it's challenging as rates tick up, it does cause sellers to pause and take note before they decide to move forward. So similar to the start slide, this is a new home sold slide, and you can see the significant run-up right before the Great Housing Recession and the fall off, and then the gradual increase, just like the housing start slide showed, and then the jump during COVID, and then drop back down last May, with the jump in rates, and then we've been slowly coming back up. As you'll see in a minute, for us, you know, our absorption paces and sales really improved this calendar year. So around January, the market really started to pick back up for us. So recent operating performance, we are among the top 20 home builders in both deliveries and revenues. We market homes across a broad product array, something that we believe is an advantage for us. Some builders focus on first-time only or luxury, like the Toll Brothers. We kind of operate in multiple product areas. On the right-hand side, you can see this for the year ended 2022, we had 38% first-time buyer product, 33% move-up, 13% luxury, and 16% active lifestyle. And that varies year to year. You know, we're in all those products. It depends on the communities we're opening, et cetera. Probably five or six years ago, first time was in the low thirties, so that's definitely been increasing for us over the last few years as that market segment has grown. On the bottom left, you can see the markets that we're in by our geographically reported segments. So the orange in the upper right is our Northeast segment. Then you've got a Southeast segment down in the Carolinas through Florida, and then our West segment is Texas, Arizona, and California. So, and then, lots controlled by region. We have 29,500 lots that we controlled as of July 31st, and it was split almost 50% in the Northeast, 40% in the West, and then 14% in the Southeast. And that doesn't necessarily mean that's how we'll deliver going forward. The time to get lots through approval is different in each of our markets, so the Northeast tends to have more lots controlled, and it takes longer to get those lots through to actually get the deal to build homes and construct and deliver. So we end up with more controlled in the Northeast, doesn't necessarily mean we end up with more deliveries in a particular year. So for the quarter ended July for us, on the left-hand side of this, you can see how, and you'll see a few slides on this, how we performed versus the prior year, and then how we did against our guidance on the right-hand side of the slide. As a reminder, for the third quarter last year, we still had a big backlog that had been built up during the really strong market during COVID, so we were still delivering quite a few homes as a result of that backlog. So it was a tough comparison from a revenue perspective. So we were down versus the prior year, but we were within our guidance range, as you can see on the right-hand side slide, at $650 million of revenue. SG&A ratio, obviously, as a result of the revenue being down, our SG&A was up, but again, right within our guidance that we had provided. And then from an adjusted homebuilding gross margin perspective, margins in the third quarter of 2022, again, really strong because of the very strong sales we had during COVID. Margins had continued to grow. I think this may have been our peak at 26.3% or right around it. You can see for the third quarter of 2023 of this year, we're at 23.2%. Still very healthy margins, and up sequentially on the upper right-hand side, we are showing sequential, just so you can see the improvement sequentially in our margins. So we... In a minute, you'll see we've been raising prices during this calendar year. As the sales improved, we were able to raise prices in many of our markets, and the margins showed that improvement sequentially. And you can see we actually beat our guidance by a little bit there. Adjusted EBITDA, again, down from the prior year as a result of the lower volume, lower margin, but up sequentially from the prior quarter, and we did beat our guidance. And again, you know, that helped the margins, the higher margins really helped us in that respect. And we're selling more, what we call quick move-in or QMI homes or spec homes, which makes knowing exactly what the margins will be for the quarter a little hard as we're getting into the beginning of the quarter. We're selling homes and delivering them in the quarter now with our existing QMI inventory. And then pre-tax, very similar to what we just saw on EBITDA, down from the prior year, but certainly up sequentially and exceeded guidance. So overall, really good quarter. I'm going to go into the sales in a minute. So we're very happy with our operating results compared to our guidance, and you'll see, we're also very happy with the sales for the quarter as well. So on the sales absorption side, you can see that for the third quarter, contracts per community were at 14.2. And on this slide, we're just showing you the third quarter, specifically all the way back to 2017. And you can see that that was the second highest over that timeframe. The only other time it was higher was in Q3 of 2020, which was the peak of the really strong COVID market. In fact, our 2023 actually exceeded Q3 2021, which was still a COVID market, still pretty good. On the far left, we often use the 1997-2002 timeframe as kind of a normal market. It was not a boom or a bust at that time. We reference that, as well, just to see how we compare, whenever, you know, where we are, back to that kind of normal market timeframe. And you can see, again, Q3 of 2023 was better than that as well. Very strong, third quarter sales for us. This slide shows the same thing, but by month, and it's a seasonally adjusted and annualized number for each month. It, it assumes what that month's sales would have been on a full year basis if you seasonally adjusted and assume extrapolated over the 12 months. You can see, as I mentioned in May of last year, the market really slowed down. It troughed for us in the month of November. Let me take a step back. There's two sets of. Each bar has two colors to it. We've isolated on this slide, Build-For-Rent sales, just to, because we did have, especially in the month of June, some significant Build-For-Rent. So we wanted to show what it was without it. For us, Build-For-Rent, it just means we're building houses and delivering them to a third party who's going to rent them out. We do not keep, or own, and rent the buildings, rent the homes out ourselves. It's, it's really like any other single-family home for us that we deliver. We're just delivering a significant number to one individual party, so you can get some lumpy contracts in those situations. So anyway, so if you focus just on the excluding Build-For-Rent, you can see we troughed in November, December picked up, and then, as I mentioned, you know, the calendar year came, and the lights came back on basically. And sales continued to grow on an absorption pace basis every month, all the way through June. And then it dropped a little in July, but still quite good. You know, anything in the forties is really good on an annualized basis. And you know, August, as we said at the time, was. August wasn't over when we gave our release, but August was trending similar to July. So, really, really happy with the sales pace we saw in the third quarter. Our quick move-in homes per community or other builders call them specs. You know, during COVID, you can see, historically, we've been running around 4.4 QMIs per community. We typically are more of a to-be-built builder than a QMI builder. Our sales are typically 60/40 out to the to-be-built side. During COVID, we couldn't even start enough homes to have any QMI. You can see it got very low at about 1.5. And then last year, as the market slowed down and the rates ticked up, it became apparent that it was better for customers, and more customers were interested in having QMIs to buy rather than to-be builds because they were able to have the certainty of what their monthly payments were going to be, what their rate was going to be. It also allows us to buy down their rate if you're within 60 days of closing, you can buy down the rate on a to-be-built house that's, you know, six or seven months out. That's cost prohibitive to buy down a rate and lock in a rate at that time. So we have intentionally been increasing our QMIs per community. We had stated a goal of about seven, and we've gotten close to that. At the end of July, we're at 6.7, and we do think that's helping our sales to have QMIs available in our communities that are getting close to delivery. The good news is that, you know, you don't want to have finished QMIs, and we only had 100 across our 122 communities as of July 31st, and that was down from 150-ish or whatever- Yeah. - at the end of the second quarter. So been able to manage our QMIs quite well, have them available, but not have too many that are sitting around finished. As I meant—so as the market improves, this, during this fiscal year for us, so Q1 for us ends in January, and then, Q2 is April, Q3 is July. You can see in the, in the first quarter, no surprise when we looked at the absorption paces, we weren't raising prices in too many communities, or certain communities that were performing, we were able to raise prices in 30% of our communities. But as the sales pace really picked up in the second and third quarter of this year, we've been able to raise prices in 69% of our communities in Q2 and 71% of them in Q3, and many of those are repeat. Obviously, they got raised in Q2 and in Q3. We raise prices. We focus on it at a community level basis and can raise prices every week. If you raise prices and it continues to sell, we raise them again. So, you know, small, consistent, price increases is what we try to do. So been very happy with that, and you saw the improvement in our sequential gross margin on the earlier slide, and that's partly to do with the fact that we've been able to raise prices. Our community count over the last three years, this just shows you Q3 of each of the last three years, basically flat. You know, 120 went to 124, now 122. We are expecting to have our community count grow in the fourth quarter of 2023, and then grow even further in 2024. Definitely something we want to focus on and have growth in our community count to build and have higher revenues and set deliveries going forward. We need to leverage the SG&A that we have, the debt that we have, et cetera. So there's a lot of benefit if we can grow our community count, and we have the capital to do so, which you'll see in a minute. Our lots controlled, from Q3 of 2022, by quarter end, all the way through the end of Q3 2023, was coming down, since Q3 of 2022. No surprise, really. We stopped, like many home builders, kind of paused as what we were doing on the land side as the market really slowed last summer. So we had less-- we were delivering homes, obviously, but not replacing them with new, lots controlled, new, new contracts with land sellers. So we, we had some declines. We troughed at Q2 of 2023, and now we're, we're going back up the mark. We're back in buying, buying land, optioning land, controlling land, for future deliveries. The other good thing about this slide is you can see that, while the total went up, the owned lots has actually come down and option increased. That's important, that the, the more we can control lots through option and not have to own them, it, generates a higher return on, on inventory, higher return on invested capital for us. It's something that, and many of the builders are talking about, asset light or land light. It's something we've been doing for a long time, but we're pushing, even harder to continue to expand and have more lots controlled through option. So you can see the progress we've made on that basis all the way back to 2015. We started at 46%, and there's just been gradual improvement, and now at a peak of 73% at the end of the most recent quarter. Something we continue to focus on, we'd love to be 99, 100% option and only own lots when we're constructing homes, which is where NVR, for those that are familiar, operates. So you know, that translates. This now shows you where our 73% stacks up on the top versus other builders. You can see NVR to the far right, Dream Finders and D.R. Horton, and then also we're, you know, fourth highest in terms of asset-light land lots controlled by option. And that translates, importantly to the bottom, where our inventory turn is third highest. And that's something that's always, always been a focus of ours. It helps us generate the highest returns on our invested capital, and frankly, higher than most in the industry. This is a EBIT return on investment slide, which we think is the purest form of operating performance, takes out leverage, and interest, and just focuses on how each of the builders is operating and getting a return. You can see NVR strategy and having very few lots owned, their inventory turn is very high, very high ROI, but we're fourth highest, similar to the land light slide. You can see it translates right to return on investment here. We also have our own financial services business, both the mortgage origination business and a title company. The mortgage origination business operates in all the states that we're in. It's complementary to our home building operations, always has been. It's even more so now. The ability to do rate buydowns is simplified by having our own mortgage origination company to help us do that. And, you know, in addition to being complementary from a service provider perspective, helping our customer make sure we close on time, which is critical for us in closing our homes, and we're much better at closing on time if it's our own mortgage company versus a third-party mortgage provider. But you can see it also generates profit, trailing twelve months, $19 million of income. So it's been a very successful and important part of our business. On the liquidity and balance sheet side, we have been over-levered for a long time, still are relative to our peers. Been a challenge of ours since the Great Housing Recession. You know, we, we've been fighting that battle. We've made a lot of progress, you'll see in a minute. But during that time frame, we've always had a target, liquidity target at quarter ends to be between $170 million and $245 million. We think that's a safe place to operate from a cash perspective. You can see that going back to July of 2020, we've been in excess of that targeted range over this whole time frame, and you'll see in a minute, we've been paying down quite a bit of debt over that time as well. So our liquidity position is strong. We have the capital and liquidity to invest in new communities, and that's where we want to get that growth I was talking about earlier to come from. On the debt maturity ladder, we got a lot going on here, so I'll start at the top. The top half of this chart is what our debt was outstanding as of the end of July, adjusted for one additional debt paydown we did in August. We paid another $100 million of debt off in August 2023. We paid off $100 million in May 2023, and we've reduced our total debt by $668 million since the beginning of fiscal 2020. So we've been making a lot of progress on reducing our debt and improving our leverage, and that's been critical. So, with all that, we then announced last week a debt refinancing that took the revolver, which was the first thing maturing, the $125 million revolver that was coming due in Q3 of 2024. We pushed that out to Q3 of 2026. That's very helpful for us. And then the stack of secured notes that was coming due for us in fiscal 2026, in Q1 and Q2 of 2026, we refinanced that out to 2028 and to 2029. So we now have much more runway and safety to operate, grow our business. We did intentionally leave the amounts that you see there as $91 million in Q2 of 2026, the $40 million in 2027, etc. In advance of that, didn't bother refinancing those. We want to continue to pay down debt, so that allows us to either pay those down early or as they mature, but continue to pay down debt and improve our financial leverage position. And that's definitely, I think, it's very important for us. That refinancing kept debt, the debt outstanding, basically flat, $2 million extra, and the annual interest incurred about $900,000 more a year. So we were able to basically do the debt refinancing at the same rates that we are at today, which we thought was a success, given the current, you know, rate environment. Our credit metrics have improved dramatically from 2019 to today. Total debt to Adjusted EBITDA and net debt to Adjusted EBITDA on the top, you can see the dramatic improvement, as we've paid down that debt, but also grown our earnings over that time frame. Then the fixed charge, basically, Fixed Charge Coverage of EBITDA to interest incurred calc on the bottom. So great improvement there since 2019 as we continue to improve our balance sheet position. Then you can see, in 2021, we finally flipped to positive equity. We had negative equity. We wrote off $2 billion worth of assets in the Great Housing Recession, and we're fighting against that over this whole time. We finally got back to positive equity in 2021, and we've grown that pretty quickly, and you can see where we project to be at the end of 2023, in October, so at the end of this month, frankly. And then what happens on the net debt side, down to $749 million by the end of the year, and net debt to net cap at under 60%. So, you know, it's significant, significant improvements from about 150% to get down to 57%-58%. Really good improvement. We want to keep that, that happening, and, you know, we're targeting a mid- ultimately, a mid-30s debt to cap is where we want to be. The last slide I'll show you here is our guidance for the full year. The left-hand column is the guidance we gave at the end of the second quarter for the full year, and then the new guidance, which is what we just provided when we did the third quarter earnings release. The metrics improved as we continued to sell, margins were getting better, et cetera. So we expect, for the year to be between $2.6 billion and $2.7 billion of revenue, our margin to be between 22% and 23%, SG&A to be in the 11%-12% of revenue range, adjusted EBITDA at $350-$370, and pre-tax at $215-$235, which translates to diluted EPS of $21-$24, and a book value per share of $66-$68 per share. So, we're frankly, very, very happy with the way the year shaped up. I think if you'd asked us at the beginning of this fiscal year or late last summer, we would not have thought that this was possible. So we were happy with the improvement in the market, and sales picked up and continue to see that. I think we definitely have the benefit, as we talked about, of there being no existing home supply. The demographics still show household formation, so people need homes, and we're the only, we and the other home, new home builders are the only game in town. You know, with rates ticking up and continuing to tick up, you know, that isn't good for us, so we'll see how that translates. But so far, we've been able to manage through rate increases with the benefit of the builder, the rate buydowns that we're using to help our customers out. That's it. I'll take questions. Yep. So obviously, the or just probably. So what's the response, you know, from customers, or how do you sort of have a cap on how rate than it reflected? Yeah. You know, other formats. You know, I guess, is that the only tool in the toolkit, as far as like, what? Yeah, I mean, there are multiple tools in the toolkit. It's a good question. The rate buydown, the way that that's kind of unfolded over the last 12 months, if you went back and looked at what we and other builders provided as the rate buydown, it was 4.5, 4.9. Then if you went and looked at the most recent week, rates that we were offering and others were offering were more in the mid 5s. So what happens is, as rates go up, we're still offering a very similar spread, but the rates are ticking up, so that's gonna have an impact because it is a cost to us and/or the customer in terms of what we can do. There's also limits to what you can do just on a mortgage. You can't give more than certain percentages, depending on the type of mortgage, in terms of incentives. So there's limits to what we can do, but the spreads that you've seen historically could stay in place in terms of if it goes to eight, we can offer six, you know, whatever that number ends up being. The other thing, obviously, is you can see our margins, despite having to give those types of concessions, have improved, and we were at 20%, you know, 23% in the most recent quarter. So there's also room for us to do some things on price if we have to, or other incentives, and I think other builders are in the same boat. I mean, sales pace is the most critical thing. I mean, you obviously wanna make margin, but you need to keep the factory running and delivering homes, and so we'll have to do what we have to do. We do that by community. We look at how each community is performing, and if a community is slowing down and having a couple weeks with no sales, we start to figure out what to do there. You know, what do we need to do on the incentive side, or is there a salesperson issue? Anything that you can think of to try to make a change. So we'll see. I mean, the most recent week, sales have been basically consistent with where we've been running. You know, seasonally adjusted, September is generally slower, but I would say seasonally, it's been fairly similar. We'll see what happens this week, you know, with the rates and the news that came out this week with rates, so... But so far, we've been able to manage through the rate increases that have been happening. Counterintuitively, that actually kind of pushes- It has the... It can do that. Yeah. It can do that. How much is too much? I mean, what happened in May when it jumped significantly, very, very quickly, that didn't get them off the fence. They all went, "Whoa," and they all waited, right? They adjusted to the new rates. We kind of stabilized in the sixes for a while, which I think got people comfortable, that that's the new rate, and they came back to the market. So part of it is how fast the rates go up. So... Other questions? So, when we think about just the overall industry, where we've been for so long, what, in your mind, kind of us growing, building faster? Is it supply, land development? What do you think the bottlenecks are to kind of... The demand seems to be there, so- I would say for us, and I think for others, it's on the land side. You know, land development during COVID initially slowed, just like we all slowed initially too, and then with supply chain issues and other things, it slowed land development. And we're, as you saw on our community count slide, we're basically flat over the last three years. We would have expected to be up, but we've had communities that are taking longer to get through land development to get open because you can't get what you need. Utilities, frankly, are a challenge. Transformers, and so they delay both getting communities open for sale, and they also sometimes end up delaying deliveries because you can't get the meters. So there are just things that have slowed, I think, slowed land development down. I think that's probably right now the biggest bottleneck. You know, finding land in the right places, it's always been a challenge, but I think it's continuing to be a challenge in terms of finding the right properties to move forward. Talk a bit about the offsite coming up. Yeah. Certainly, commodity prices are going to roll over, supply chain and also... Yeah. So I think, as you saw in our margins, we benefited a lot from the supply chain starting to loosen up. So during COVID, the supply chain was extremely challenging, as everybody talked about. Our construction cycle time extended to seven or eight months on what would normally be four to six, four to five, you know, something like that. Cost, getting materials, costs were going up. A lot of that has loosened up. Our construction cycle times are about 30 days better now than they have been, so we're still not back to normal, but now we're probably more in the six to seven month range, instead of seven to eight. That helps on the inventory turn side. But in addition, that means that materials are becoming available, so that helps hold back price cost increases. And labor has been less of an issue as well. So I think overall... And lumber's helped a lot, frankly, you know, year over year. So right now labor, supply, material, it's not a significant it's not a major issue. Certainly, there are materials that are going up. Inflation doesn't help. I mean, we're certainly seeing cost increases in some of our areas. But with the slowdown that happened as a result of the rate increases, that gave us some leverage to go back to our trades and say, "Hey, you guys, you know, we raised prices with you or increased costs for us by paying them more during COVID when it was really hot. We need to keep going. You need to help us out here and come back down on, on price." So there's been some movement that I think has helped us this year. Will that continue? We'll see. Yeah. It did. So we are at 70%. A year ago, we were at 59%, so it gives you an idea of the improvement. What would I wanna be? I'd love to be at 100%. I'd love to have all of our mortgages originated by our mortgage company because it, it helps our process significantly. Can the third-party mortgage companies do it? Generally, no, they can't. I mean, they're not gonna, they're not gonna give an incentive to the, to that customer to go buy a house. The customer theoretically could do it, but that means they've gotta come up with cash to buy their rate down, so doesn't really help them either. So that's why, if that's what you're pulsing on, that's one of the reasons our capture rate is up, certainly, is because we can provide that, and third-party originators can't. Yes? In our- Do you happen to have affordability slide handy? Yeah. I mean, I won't be able to show it, but, you know, it's something that we monitor all the time. Every six months, we do financial plan reviews with all our divisions, and we look at it by market. I would say that almost every market's probably above the Mendoza Line for affordability right now. So that's not helpful. Customers are finding ways to manage that. Now, that affordability calculation uses current mortgage rates, and we're buying rates down, so that's where we're helping out on the affordability side. But that's definitely a potential issue. How far above? Do you have, do you have anything handy? You can pick a couple markets. Do you have a national one? I have a national one here. Yeah. So the national one is, it's 87.8, where it is right now across the country. So if it's at 100, that's affordable, and the average is about 125.7. So we're pretty far below. And I went through - I don't have any of the ones in front of me right now, but I went through that process of doing it for our budget meetings that are coming up, and I'd say that. Is there any market that- 90% of them were at the market. Like, we show a high and a low over, like, a 20-year period of time, and 90% of them are at the, the low, you know, the lowest- The worst they've been. The worst it could be, yeah. It's definitely an issue because housing prices went up during COVID. Actually, we've been raising prices to some, to some extent this year as well, and then when rates run up the way they did, it just crushes those affordability calculations. Other questions? I think we're about out of time anyway. Thank you, everybody.