Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): February 28, 2020

Toll Brothers, Inc.

(Exact Name of Registrant as Specified in Charter)



Delaware	001-09186		23-2416878
(State or Other Jurisdiction of Incorporation)	(Commission File Number)		(IRS Employer Identification No.)

250 Gibraltar Road	Horsham	PA	19044
(Address of Principal Executive Offices)			(Zip Code)

Registrant’s telephone number, including area code: (215) 938-8000

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.01 per share	TOL	The New York Stock Exchange
Guarantee of Toll Brothers Finance Corp. 5.625% Senior Notes due 2024	TOL/24	The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

In the first quarter of fiscal 2020, Toll Brothers, Inc. (the “Company”) appointed Mr. James Boyd and Mr. Robert Parahus as Executive Vice Presidents and Co-Chief Operating Officers to succeed Mr. Richard Hartman, who retired from the position of President and Chief Operating Officer on the same date. Mr. Boyd now has oversight responsibility for the Company’s western region and Mr. Parahus its eastern region. In connection with the succession of the Chief Operating Officer role, the Company made certain changes to its regional management structure and realigned certain of the states falling among its five homebuilding regions, as follows:

Eastern Region:


•	The North region: Connecticut, Delaware, Illinois, Massachusetts, Michigan, Pennsylvania, New Jersey and New York;


•	The Mid-Atlantic region: Georgia, Maryland, North Carolina, Tennessee and Virginia;


•	The South region: Florida, South Carolina and Texas;

Western Region:


•	The Mountain region: Arizona, Colorado, Idaho, Nevada and Utah; and


•	The Pacific region: California, Oregon and Washington.

Previously, the Company’s homebuilding regional segments were:


•	North: Connecticut, Illinois, Massachusetts, Michigan, New Jersey and New York


•	Mid-Atlantic: Delaware, Maryland, Pennsylvania and Virginia


•	South: Florida, Georgia, North Carolina, South Carolina and Texas


•	West: Arizona, Colorado, Idaho, Nevada, Oregon, Utah and Washington


•	California: California

The Company’s new reporting segments are consistent with how the Company’s chief executive officer is assessing operating performance and allocating capital following the realignment of the regional management structure. The realignment did not have any impact on the Company’s consolidated financial position, results of operations, earnings per share or cash flows. Prior period segment information will be recast to conform to the new reporting structure.

The Company is furnishing this Form 8-K to provide investors with historical segment information that is consistent with its new reporting structure. The schedules in Exhibit 99.1 provide unaudited segment information on the basis of the new reporting segments for the previously reported years ended October 31, 2019 and 2018, and the three month periods ended January 31, April 30, July 31 and October 31 of each of 2019 and 2018. The recast financial information contained in Exhibit 99.1 does not represent a restatement or reissuance of previously issued financial statements.

The information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

The following Exhibits are furnished as part of this Current Report on Form 8-K:

Exhibit

No. Item


99.1*	Schedules of unaudited segment information for the years ended October 31, 2019 and 2018, and the three month periods ended January 31, April 30, July 31 and October 31 of each of 2019 and 2018


104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed electronically herewith

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.




		TOLL BROTHERS, INC.

Dated:	February 28, 2020	By:	/s/ Michael J. Grubb
			Michael J. Grubb Senior Vice President, Chief Accounting Officer

EXHIBIT 99.1

The purpose of this schedule is to provide investors with historical segment information that has been recast on a basis consistent with Toll Brothers, Inc.'s new segment reporting structure that was implemented in the first quarter of its fiscal 2020. The tables provide unaudited recast segment information for the previously reported years ended October 31, 2019 and October 31, 2018, and the three month periods ended January 31, April 30, July 31 and October 31 of each of 2019 and 2018.

Units Delivered and Revenues:



	Fiscal 2019
	Units Delivered					Revenues ($ Millions)													Average Delivered Price Per Unit ($ Thousands)
	Q1	Q2	Q3	Q4	FY	Q1			Q2		Q3		Q4			FY			Q1		Q2		Q3		Q4		FY
Traditional Home Building:
North	384	518	546	775	2,223	$	271.5		$	345.1	$	360.0	$	507.8		$	1,484.4		$	707.1	$	666.2	$	659.4	$	655.2	$	667.7
Mid-Atlantic	211	252	330	444	1,237	134.9			174.1		213.7		281.6			804.3			$	639.3	$	690.8	$	647.6	$	634.3	$	650.2
South	228	313	312	445	1,298	176.9			242.8		243.4		328.8			991.9			$	776.0	$	775.6	$	780.2	$	738.9	$	764.2
Mountain	366	416	437	492	1,711	226.4			285.8		292.7		326.0			1,130.9			$	618.6	$	687.0	$	669.8	$	662.5	$	661.0
Pacific	277	340	329	488	1,434	444.1			579.6		573.5		819.5			2,416.7			$	1,603.1	$	1,704.8	$	1,743.1	$	1,679.2	$	1,685.3
Traditional Home Building	1,466	1,839	1,954	2,644	7,903	1,253.8			1,627.4		1,683.3		2,263.7			6,828.2			$	855.2	$	884.9	$	861.5	$	856.2	$	864.0
City Living	64	72	40	28	204	68.6			84.1		71.9		28.6			253.2			$	1,071.8	$	1,167.7	$	1,797.3	$	1,022.5	$	1,239.2
Corporate and other						(3.1		)	0.6		1.8		(0.3		)	(1.0		)
Total home sales	1,530	1,911	1,994	2,672	8,107	1,319.3			1,712.1		1,757.0		2,292.0			7,080.4			$	862.3	$	895.9	$	881.2	$	857.8	$	873.3
Land sales						43.9			4.0		8.7		87.0			143.6
Total consolidated						$	1,363.2		$	1,716.1	$	1,765.7	$	2,379.0		$	7,224.0



	Fiscal 2018
	Units Delivered					Revenues ($ Millions)										Average Delivered Price Per Unit ($ Thousands)
	Q1	Q2	Q3	Q4	FY	Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		Q4		FY
Traditional Home Building:
North	357	521	589	792	2,259	$	232.0	$	351.8	$	390.8	$	543.3	$	1,517.9	$	649.8	$	675.2	$	663.5	$	686.1	$	671.9
Mid-Atlantic	229	272	389	381	1,271	137.8		168.5		235.5		233.9		775.7		$	601.5	$	619.7	$	605.3	$	614.0	$	610.3
South	176	262	314	362	1,114	143.0		201.5		243.3		280.8		868.6		$	812.6	$	769.0	$	774.9	$	775.6	$	779.7
Mountain	355	458	466	518	1,797	207.0		282.1		293.2		344.3		1,126.6		$	583.1	$	615.8	$	629.2	$	664.7	$	626.9
Pacific	242	344	459	610	1,655	338.1		505.7		700.0		989.7		2,533.5		$	1,397.3	$	1,470.0	$	1,525.0	$	1,622.5	$	1,530.8
Traditional Home Building	1,359	1,857	2,217	2,663	8,096	1,057.9		1,509.6		1,862.8		2,392.0		6,822.3		$	778.4	$	812.9	$	840.2	$	898.3	$	842.7
City Living	64	29	29	47	169	117.6		89.6		50.6		63.2		321.0		$	1,837.5	$	3,090.8	$	1,745.4	$	1,343.6	$	1,899.4
Total consolidated	1,423	1,886	2,246	2,710	8,265	$	1,175.5	$	1,599.2	$	1,913.4	$	2,455.2	$	7,143.3	$	826.0	$	847.9	$	851.9	$	906.0	$	864.3

Net Contracts Signed:



	Fiscal 2019
	Net Contracted Units					Net Contract Value ($ Millions)										Average Contracted Price Per Unit ($ Thousands)
	Q1	Q2	Q3	Q4	FY	Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		Q4		FY
Traditional Home Building:
North	402	687	611	567	2,267	$	275.2	$	454.8	$	400.4	$	381.2	$	1,511.6	$	684.7	$	662.0	$	655.4	$	672.3	$	666.8
Mid-Atlantic	253	344	299	263	1,159	160.4		236.8		201.6		173.7		772.5		$	633.8	$	688.5	$	674.2	$	660.6	$	666.5
South	201	404	344	358	1,307	152.4		288.4		255.5		244.8		941.1		$	758.2	$	713.8	$	742.7	$	683.7	$	720.0
Mountain	331	600	622	544	2,097	241.1		405.6		414.5		395.0		1,456.2		$	728.4	$	675.9	$	666.5	$	726.1	$	694.4
Pacific	169	348	325	253	1,095	294.6		554.6		533.3		422.3		1,804.8		$	1,743.5	$	1,593.6	$	1,640.8	$	1,669.2	$	1,648.2
Traditional Home Building	1,356	2,383	2,201	1,985	7,925	1,123.7		1,940.2		1,805.3		1,617.0		6,486.2		$	828.7	$	814.2	$	820.2	$	814.6	$	818.4
City Living	23	41	40	46	150	39.7		63.1		63.5		58.4		224.7		$	1,724.4	$	1,538.9	$	1,587.1	$	1,271.8	$	1,498.3
Total consolidated	1,379	2,424	2,241	2,031	8,075	$	1,163.4	$	2,003.3	$	1,868.8	$	1,675.4	$	6,710.9	$	843.6	$	826.4	$	833.9	$	825.0	$	831.1



	Fiscal 2018
	Net Contracted Units					Net Contract Value ($ Millions)										Average Contracted Price Per Unit ($ Thousands)
	Q1	Q2	Q3	Q4	FY	Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		Q4		FY
Traditional Home Building:
North	441	626	626	554	2,247	$	311.1	$	422.6	$	407.7	$	369.9	$	1,511.3	$	705.5	$	675.1	$	651.2	$	667.8	$	672.6
Mid-Atlantic	195	368	362	251	1,176	129.2		230.3		229.7		170.3		759.5		$	662.5	$	625.8	$	634.7	$	678.1	$	645.8
South	262	383	323	244	1,212	208.4		286.8		256.6		196.5		948.3		$	795.3	$	748.8	$	794.5	$	805.3	$	782.4
Mountain	417	559	493	402	1,871	263.6		345.3		328.0		292.7		1,229.6		$	632.0	$	617.6	$	665.2	$	728.4	$	657.2
Pacific	460	665	463	242	1,830	716.3		1,001.1		729.3		431.1		2,877.8		$	1,557.2	$	1,505.4	$	1,575.3	$	1,781.1	$	1,572.6
Traditional Home Building	1,775	2,601	2,267	1,693	8,336	1,628.6		2,286.1		1,951.3		1,460.5		7,326.5		$	917.5	$	878.9	$	860.8	$	862.7	$	878.9
City Living	47	65	49	22	183	61.8		97.1		80.7		38.2		277.8		$	1,316.0	$	1,494.3	$	1,646.3	$	1,732.9	$	1,518.0
Total consolidated	1,822	2,666	2,316	1,715	8,519	$	1,690.4	$	2,383.2	$	2,032.0	$	1,498.7	$	7,604.3	$	927.8	$	893.9	$	877.4	$	873.8	$	892.6

Backlog:



	Fiscal 2019
	Backlog Units				Backlog Value ($ Millions)								Average Backlog Price Per Unit ($ Thousands)
	Q1	Q2	Q3	Q4	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
Traditional Home Building:
North	1,716	1,885	1,950	1,742	$	1,154.0	$	1,264.5	$	1,305.4	$	1,179.6	$	672.5	$	670.8	$	669.5	$	677.2
Mid-Atlantic	779	871	965	784	525.6		588.5		642.6		535.3		$	674.8	$	675.7	$	665.9	$	682.7
South	944	1,035	1,067	1,048	756.9		802.8		815.2		757.3		$	801.8	$	775.6	$	764.0	$	722.6
Mountain	1,185	1,369	1,554	1,606	838.8		958.8		1,081.5		1,150.9		$	707.9	$	700.4	$	695.9	$	716.6
Pacific	1,205	1,213	1,209	974	1,942.7		1,919.4		1,879.7		1,484.4		$	1,612.2	$	1,582.3	$	1,554.8	$	1,524.0
Traditional Home Building	5,829	6,373	6,745	6,154	5,218.0		5,534.0		5,724.4		5,107.5		$	895.2	$	868.4	$	848.7	$	829.9
City Living	125	94	94	112	148.7		127.7		119.7		149.6		$	1,189.4	$	1,358.4	$	1,272.9	$	1,335.6
Total consolidated	5,954	6,467	6,839	6,266	$	5,366.7	$	5,661.7	$	5,844.1	$	5,257.1	$	901.4	$	875.5	$	854.5	$	839.0



	Fiscal 2018
	Backlog Units				Backlog Value ($ Millions)								Average Backlog Price Per Unit ($ Thousands)
	Q1	Q2	Q3	Q4	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
Traditional Home Building:
North	1,794	1,899	1,936	1,698	$	1,235.8	$	1,306.7	$	1,323.5	$	1,150.1	$	688.9	$	688.1	$	683.6	$	677.3
Mid-Atlantic	798	894	867	737	507.8		569.5		563.8		500.1		$	636.3	$	637.0	$	650.3	$	678.6
South	959	1,080	1,089	971	766.0		851.3		864.6		780.3		$	798.7	$	788.2	$	794.0	$	803.6
Mountain	1,208	1,309	1,336	1,220	777.4		840.5		875.3		823.8		$	643.5	$	642.1	$	655.1	$	675.3
Pacific	1,356	1,677	1,681	1,313	2,124.4		2,619.9		2,649.3		2,090.6		$	1,566.7	$	1,562.2	$	1,576.0	$	1,592.2
Traditional Home Building	6,115	6,859	6,909	5,939	5,411.4		6,187.9		6,276.5		5,344.9		$	884.9	$	902.2	$	908.5	$	900.0
City Living	135	171	191	166	165.1		172.5		202.6		177.6		$	1,222.6	$	1,009.0	$	1,060.7	$	1,069.7
Total consolidated	6,250	7,030	7,100	6,105	$	5,576.5	$	6,360.4	$	6,479.1	$	5,522.5	$	892.2	$	904.8	$	912.6	$	904.6

Income (Loss) Before Income Taxes ($ amounts in millions):



	Fiscal 2019															Fiscal 2018
	Q1			Q2			Q3			Q4			FY			Q1			Q2			Q3			Q4			FY
Traditional Home Building:
North	$	15.1		$	7.3		$	25.2		$	33.9		$	81.5		$	6.0		$	12.0		$	30.6		$	49.7		$	98.3
Mid-Atlantic	7.1			10.4			12.0			21.2			50.7			10.9			13.1			13.8			21.4			59.2
South	15.7			28.6			24.4			37.4			106.1			9.5			24.1			32.2			34.1			99.9
Mountain	25.6			27.4			32.2			27.8			113.0			21.8			33.1			37.5			43.9			136.3
Pacific	91.6			123.0			121.8			173.3			509.7			69.7			100.6			162.9			238.1			571.3
Traditional Home Building	155.1			196.7			215.6			293.6			861.0			117.9			182.9			277.0			387.2			965.0
City Living	14.6			25.9			19.1			10.5			70.1			30.0			16.7			13.6			17.8			78.1
Corporate and other	(18.3		)	(46.4		)	(47.8		)	(31.4		)	(143.9		)	(16.3		)	(46.9		)	(37.5		)	(8.5		)	(109.2		)
Total consolidated	$	151.4		$	176.2		$	186.9		$	272.7		$	787.2		$	131.6		$	152.7		$	253.1		$	396.5		$	933.9

Home Sales Cost of Revenues as a Percentage of Home Sales Revenues:



	Fiscal 2019										Fiscal 2018
	Q1		Q2		Q3		Q4		FY		Q1		Q2		Q3		Q4		FY
Traditional Home Building:
North	83.7	%	89.5	%	84.3	%	86.7	%	86.2	%	86.4	%	88.9	%	85.0	%	84.8	%	86.0	%
Mid-Atlantic	83.9	%	85.7	%	86.8	%	85.7	%	85.7	%	82.5	%	84.3	%	86.1	%	84.3	%	84.5	%
South	84.1	%	82.7	%	83.4	%	83.4	%	83.4	%	85.1	%	82.2	%	81.3	%	82.9	%	82.7	%
Mountain	78.8	%	81.1	%	79.8	%	82.5	%	80.7	%	80.4	%	81.0	%	79.9	%	80.1	%	80.3	%
Pacific	73.2	%	73.7	%	73.7	%	75.0	%	74.0	%	72.6	%	74.2	%	72.0	%	72.4	%	72.7	%
City Living	76.1	%	65.6	%	70.6	%	72.1	%	70.6	%	73.2	%	81.1	%	73.3	%	71.9	%	75.2	%
Total consolidated	79.0	%	80.3	%	79.8	%	81.2	%	80.2	%	79.5	%	81.2	%	78.9	%	78.6	%	79.4	%