Five Point Holdings (NYSE:FPH) reported first-quarter financial results on Thursday. The transcript from the company’s first-quarter earnings call has been provided below.
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The full earnings call is available at https://event.choruscall.com/mediaframe/webcast.html?webcastid=gpQnhiUn
Summary
Five Point Holdings LLC reported a consolidated net loss of $5 million for the first quarter of 2026, primarily due to the timing of land sales.
The company has announced a $40 million share repurchase program, with the intention to maintain substantial liquidity even after execution.
Despite geopolitical uncertainties and rising mortgage rates, Five Point Holdings LLC remains confident in long-term demand for its California-based home sites, due to a chronic undersupply in those markets.
The company reaffirmed its full-year 2026 guidance, expecting approximately $100 million in earnings, with earnings weighted towards the latter half of the year.
Five Point Holdings LLC ended the quarter with $550.1 million in liquidity, including $332 million in cash and cash equivalents, and maintains a debt to total capitalization ratio of 16.3%.
Strategically, the company is focused on optimizing home site value, maintaining a lean operating structure, matching development expenditures with revenue generation, and expanding through capital-light growth initiatives.
The Hearthstone Platform secured $600 million in new equity commitments, enabling approximately $1 billion in capital deployment, and currently manages approximately $3.4 billion in assets.
The company is progressing with its master-planned communities, with developments in Valencia and San Francisco, and anticipates significant land sales and development activities in upcoming quarters.
Full Transcript
OPERATOR
Greetings and welcome to the Five Point Holdings LLC first quarter 2026 conference call. As a reminder, this call is being recorded. Today’s call may include forward looking statements regarding Five Point Holdings LLC’s financial condition, Operations, Cash Flow, Strategy, acquisitions and prospects. Forward-looking statements represent Five Point Holdings LLC’s estimates on the date of this conference call and are not intended to give any assurance as to actual future results. Because forward looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties. Many factors could affect future results and may cause Five Points actual activities or results to differ materially from the activities and results anticipated in forward looking statements. These factors include those described in today’s Press release and FivePoint’s SEC filings, including those in the Risk Factors section of Five Point Holdings LLC’s most recent annual report on Form 10K filed with the SEC. Please note that Five Point assumes no obligation to update any forward looking statements. Now I would like to turn the call over to Dan Heddegan, President and Chief Executive Officer.
Dan Heddegan (President and Chief Executive Officer)
Thank you. Good afternoon and thank you for joining our call. I have with me today Mike Alvarado, our Chief Operating Officer and Chief Legal Officer Kim Tobler, our Chief Financial Officer and Leo Key, our Senior Vice President of Finance and Reporting. Stuart Miller, our Executive Chairman, is joining us remotely on today’s call. I’ll update you on our first quarter results and provide an overview of the current state of our business, including our operating strategy and expectations for the remainder of 2026. Mike will then discuss our Hearthstone Venture and other growth initiatives in more detail, after which Kim will review our financial results and outlook. We’ll then open the line for questions. Turning to the first quarter as expected, we began 2026 with a relatively quiet quarter from a land sales perspective and reported a consolidated net loss of $5 million. This result was driven primarily by the timing of land sales, as we did not have any significant residential land closings during the quarter. As we discussed in prior periods, our earnings are inherently tied to the timing of land transactions and we expect variability from quarter to quarter depending on when these sales occur. From a revenue standpoint, we generated $13.6 million during the quarter, primarily from management services associated with our Great Park and Hearthstone segments. From a balance sheet perspective, we ended the quarter with total liquidity of $550.1 million, including 332 million of cash and cash equivalents. This level of liquidity continues to provide us with substantial flexibility to operate the business, manage through market cycles and pursue strategic opportunities, including the $40 million share repurchase that we announced today, which I’ll discuss in more detail later in my remarks. Operationally, activity across our communities remain steady. At the Great Park, builders sold 82 homes during the quarter while Valencia saw 90 home sales. While these volumes reflect a more measured pace than we saw at certain points in 2025, they demonstrate continued engagement from home buyers even in a more challenging environment. As we look ahead, we continue to expect our earnings in 2026 to be weighted toward the third and fourth quarters as land sales close and fee based income grows. Let me now turn to the market. The current market environment is unsettled and consumer confidence has been impacted by a number of factors including geopolitical uncertainty stemming from the conflict in the Middle East, increased volatility in financial markets and mortgage rates that have risen again recently after trending down. Briefly, we’re seeing the impact of these dynamics across the home building sector as consumers have been hesitant to make large purchase decisions in uncertain environments. Prior to starting the conflict in the Middle East, we saw green shoots of improvement in consumer confidence driven in part by a reduction in mortgage rates and believe that markets and demand will recover following a resolution of the conflict. These recent trends have translated into slower absorption rates and a more cautious approach by builders in committing to new land purchases in the near term. That said, since our communities are located in California markets that remain chronically undersupplied, we continue to see demand for our home sites. With our liquidity and balance sheet, we have the flexibility to adjust the pace and structure of our land sales in order to protect long term value. I’ll share more about our land sales during my community updates. Let me now turn to the $40 million share repurchase that our board has approved. We believe the share repurchase gives us the ability to opportunistically deploy capital at an attractive return given that our shares are currently trading at a significant discount to book value. Importantly, the repurchase has been structured to preserve financial flexibility. Even after execution, we expect to maintain substantial liquidity to support our operations, development activities and strategic growth initiatives. Let me now turn to our operating strategy. As a reminder, our strategy is built around four key elements. First, we are focused on optimizing home site value within our master plan communities by aligning land sales with home builder demand. In the current environment, this means being disciplined and patient, in some cases moderating the pace of land sales or using different land sales structures to maintain long term value. Second, we are maintaining a lean operating structure …
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