Toll Brothers

Toll Brothers, Inc.
Public company
Traded as NYSE: TOL
S&P 400 Component
Industry Home construction
Founded 1967 (1967)
Founders Robert I. Toll
Bruce E. Toll
Headquarters Horsham, Pennsylvania
Key people
 Robert I. Toll, Chairman
Douglas C. Yearley, Jr., CEO
Richard T. Hartman, President & COO
Martin P. Connor, CFO[1]
Production output
 7,151 new home deliveries[1]
Revenue Increase $5.815 billion (2017)[1]
Increase $0.535 billion (2017)[1]
Total assets Decrease $9.445 billion (2017)[1]
Total equity Increase $4.537 billion (2017)[1]
Number of employees
 4,500 (2017)[1]
Website www.tollbrothers.com

Toll Brothers is a home construction company based in Horsham, Pennsylvania that specializes in building luxury homes. In 2016, the company was the 10th largest home builder in the United States, based on the number of homes closed.[2] The company is ranked 497th on the Fortune 500.[3] The company operates in 20 states.[1]

In addition to luxury home construction, the company designs, markets, sells, and arranges financing for homes. The company also develops and operates for-rent apartments through joint ventures.[1]

In 2017, the company sold homes at an average base price of $689,000 plus average option upgrades of $152,000.[1]

History

Toll Brothers was founded in 1967 in Pennsylvania by Robert I. Toll and Bruce E. Toll. Bob received a law degree from University of Pennsylvania and his B.A. from Cornell University, while his brother Bruce had an accounting degree from the University of Miami. Their father, Albert, built homes and the brothers believed that the new home industry had more to offer. Bruce was 24 and Robert was 27 at the time.[4]

In 1982 Toll Brothers expanded to New Jersey. In May 1986 where they developed property in Kinnelon, NJ, in cooperation with Michael Felkay. Toll Brothers was incorporated as a Delaware corporation[5] with a public offering raising $40 million.[6]

Toll Brothers are now the center of controversy in Philadelphia for their plans to build a residential tower in the Jewelers Row neighborhood of Philadelphia, one of the oldest diamond districts in America.[7]

Executives

Doug Yearley joined Toll Brothers in 1990 and was promoted as Chief Executive Officer in June 2010.[8] Doug also serves as Co-Chair of the Pennsylvania Chapter of American Cancer Society's CEO's Against Cancer.[9]

Robert Toll now serves exclusively as Executive Chairman of the Board.[8]

Richard Hartman joined Toll Brothers in 1980 and was promoted to Chief Operating Officer and Executive Vice President in January 2012.[8]

Martin Connor was hired as Toll Brother's CFO in 2010.[8]

Acquisitions

Toll Brothers primarily builds customized single and attached luxury homes on land that it acquires and develops.[10]

In 2011, Toll Brothers acquired Seattle builder CamWest Development LLC for an undisclosed cash price.[11]

In November 2013, Toll Brothers agreed to buy Shapell Industries for roughly $1.6 billion, making Nathan Shapell's daughter, Vera Guerin, a billionaire. The acquisition delivered an additional 5,200 lots in the Los Angeles and San Francisco Bay areas.[12]

In 2014, Toll Brothers doubled its presence in Houston through the purchase of a 3,700 acre parcel known as the Sienna South project which is planned to be used for about 6,500 homes.[13]

In January 2015, Toll Brothers acquired Gramercy Park site to expand its presence in New York City.[14]

In September 2015, Toll Brothers held 47,200 home sites.[15]

In November 2016, Toll Brothers acquired Coleman Homes for an undisclosed cash price.

Awards

Toll Brothers was named the Most Admired Home Building Company in Fortune magazine's survey of the World's Most Admired Companies for 2015.[16] Toll Brothers was ranked by Fortune as the 39th fastest growing company in 2014.[17]

In 2014 Builder Magazine[18] and in 2012 Professional Builder Magazine[19] named Toll Brothers 'Builder of the Year'.[20]

Financial Analysis

An analysis of the Q4 2015 financial reports[21] indicates that Toll Brothers had a current ratio (current assets / current liabilities) of over 9. These assets provided Toll Brothers with working capital of over US$7.297 billion. Toll Brothers had a quick ratio (acid test) of 1.33.

Toll Brothers had an accounts receivable turnover of 15.6 providing an average days' sales in accounts receivable of 23.4 days. Inventory turnover was 0.48 with an average days' sales in inventory of 764 days.

Toll Brothers' had a debt-to-equity ratio of 1.18 and a debt-to-capital ratio of 46.6% in Q4 2015.[22]

Disputes

Toll Brothers was sued in April 2007 by a group of investors claiming they were misled by directors about their ability to maintain historically high-earnings during the downturn in the U.S. residential real estate market.[23] Toll Brothers agreed to settle suit for $25 million, though they did not admit any wrongdoing.[24]

Six residents at the Northside Piers development complained of faulty window seals that leaked in air and rain when windy.[25] The project gained notoriety in 2007 when a kettle of roofing tar on the top level caught fire during construction and although quickly contained produced a significant amount of smoke.[26] After meeting with the residents Toll Brothers agreed to fix the seals.[27] Toll Brothers sued the contractor who installed the windows for $10 million.[28]

In 2012, the company was required to pay a penalty of $741,000 for numerous alleged violations of the Clean Water Act, including more than 600 relating to runoff of stormwater at its building sites, among them sites in the Chesapeake Bay Watershed.[29] Toll Brothers agreed to implement storm-water training and prevention techniques across the entire company.[30]

References

  1. 1 2 3 4 5 6 7 8 9 10 "Toll Brothers, Inc. 2017 Form 10-K Annual Report". U.S. Securities and Exchange Commission.
  2. ↑ "The Top 100: 2017". builderonline.com.
  3. ↑ "Fortune 500: Toll Brothers". Fortune.
  4. ↑ "History of Toll Brothers Inc. – FundingUniverse". www.fundinguniverse.com. Retrieved February 10, 2016.
  5. ↑ Toll Brothers, Inc., Form 10-K, U.S. Securities and Exchange Commission, December 22, 2010
  6. ↑ "Toll Brothers Inc Facts, information, pictures | Encyclopedia.com articles about Toll Brothers Inc". www.encyclopedia.com. Retrieved February 10, 2016.
  7. ↑ "Toll's new tower design for Jewelers Row is an architectural zombie - Inga Saffron". philly.com.
  8. 1 2 3 4 Department, Toll Brothers, Inc. Internal Web. "Toll Brothers - Executive Biographies". www.tollbrothers.com. Retrieved February 13, 2016.
  9. ↑ "The American Cancer Society: Philadelphia CEOs Against Cancer". main.acsevents.org. Retrieved February 13, 2016.
  10. ↑ "TOL:New York Stock Quote - Toll Brothers Inc". Bloomberg.com. Retrieved February 10, 2016.
  11. ↑ Wotapka, Dawn. "Toll Brothers to Buy Seattle Builder". Wall Street Journal. ISSN 0099-9660. Retrieved February 10, 2016.
  12. ↑ Gittelsohn, John. "Toll to Buy California Builder Shapell for $1.6 Billion". Bloomberg.com. Retrieved February 10, 2016.
  13. ↑ Hudson, Kris. "Toll Spreads Out in Houston". Wall Street Journal. ISSN 0099-9660. Retrieved February 10, 2016.
  14. ↑ "Toll Brothers makes $135M buy in NYC - New York Business Journal". Builder. Retrieved February 10, 2016.
  15. ↑ "A Geographic Overview of Toll Brothers' Homebuilding Operation - Market Realist". marketrealist.com. Retrieved February 12, 2016.
  16. ↑ "Toll Brothers". Fortune. Retrieved February 10, 2016.
  17. ↑ "Toll Brothers". Fortune. Retrieved February 10, 2016.
  18. ↑ "Toll Brothers Takes Home Builder of the Year Honors at HLS". Builder. Retrieved February 10, 2016.
  19. ↑ "Builder of the Year report: Toll Brothers - new guard, new era, more success". Pro Builder. Retrieved February 10, 2016.
  20. ↑ Inc., Toll Brothers,. "Toll Brothers Named Builder of the Year by BUILDER Magazine". GlobeNewswire News Room. Retrieved February 10, 2016.
  21. ↑ "The Globe and Mail - Stock Quote". The Globe and Mail. Retrieved February 16, 2016.
  22. ↑ "Toll Brothers 2015 Annual Report" (PDF). Toll Brothers. Retrieved February 17, 2016.
  23. ↑ http://www.sedgwicklaw.com/credit-crunch-digest-12-29-2010/#toll
  24. ↑ Pearson, Sophia (November 2, 2010), "Toll to Pay $25 Million to End Lawsuit Alleging Company Misled Investors", bloomberg.com, Bloomberg L.P.
  25. ↑ Calder, Rich (March 23, 2011), "Williamsburg waterfront condo residents complain of 'shoddy' construction", New York Post, nypost.com
  26. ↑ Dobkin, Jak (September 26, 2007), "Williamsburg Condo Market Going up in Flames", Gothamist (blog), Gothamist, archived from the original on December 7, 2008
  27. ↑ "Disgruntled Northside Piers Buyers Declare War on Toll Brothers". Curbed NY. Retrieved February 11, 2016.
  28. ↑ Pincus, Adam. "Toll Bros. sues contractors at One Northside Piers for $10 million". The Real Deal New York. Retrieved February 11, 2016.
  29. ↑ Homebuilder Toll Brothers Inc. to Pay $741,000 Clean Water Act Penalty and Implement Company-Wide Stormwater Controls / Settlement to Prevent Millions of Pounds of Sediment and Polluted Stormwater Runoff from Entering U.S. Waterways Each Year, United States Environmental Protection Agency, June 20, 2012, retrieved February 10, 2016
  30. ↑ "Toll Brothers settles with EPA - Public Spirit Willow Grove Guide - Montgomery News". Montgomery Media. Retrieved February 11, 2016.
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