1. For The Three Months Ended January 31, 2005
First Quarter Report
Horsham, Pennsylvania 19044-2323
1st Quarter Report
A Letter To Our Shareholders:
250 Gibraltar Road
We are pleased to report a great first quarter move-up, empty-nester, active-adult, resort-
with records across the board. Net income style golf and lake communities, urban in-fill,
rose 120% to $110.2 million versus first high-density suburban, beach tower and,
quarter 2004. Revenues rose 67% to $999.1 most recently, urban tower residences.
million. Contracts grew 60% to $1.44 billion.
In response to the widening gap between
And our backlog, the highest for any quarter
tight supply and growing demand, we have
in our history, increased 66% to $4.89 billion.
continued to increase our land position—we
With this backlog, which already contains now control more than 63,000 home sites,
most of Fiscal Year (FY) 2005 deliveries, and which is about a five-to-six year supply based
based on the strength of our first quarter on our historic pace of expansion. With this
Hopewell Junction, New York
earnings, we have increased our projection land, attractive demographics, our diversity
for FY 2005 net income, which we now of products and our highly respected brand
believe will grow approximately 60% over name in the luxury market, we believe we are
FY 2004. well-positioned for continued growth in the
years ahead.
We are enjoying strong pricing power and
increasing profit margins as demand for We thank our shareholders, our contractors,
luxury homes continues to outpace supply. our suppliers and our home buyers for their
Due to this demand, a recovering economy, continued support, and our associates,
The Exeter Federal at Somerset Crossing
and our growing portfolio of well-positioned whose hard work and service to our
communities in affluent markets, we customers continue to drive our success.
believe FY 2006 will be another record year
with net income growth of approximately
20% over FY 2005.
Increasing numbers of high-income
households are competing for a constrained
supply of home sites; gaining approvals to
ROBERT I. TOLL BRUCE E. TOLL
build in affluent, well-located neighborhoods Chairman of the Board and Vice Chairman
is a complex, expensive and lengthy Chief Executive Officer of the Board
undertaking. We believe that because we at
Toll Brothers have the expertise and capital to
control land, win approvals and improve
ZVI BARZILAY
properties successfully, we will continue to President and Chief Operating Officer
gain share from the smaller builders who
populate the luxury end of the market.
February 23, 2005
By expanding our product lines in the
luxury market, we are broadening our
potential customer base. We now build

2. Corporate Profile Consolidated Condensed Statements Of Income
(Amounts in thousands, except per share data)
Toll Brothers, Inc. is the nation’s leading builder of luxury homes. The Company began business in 1967 and became a Three Months Ended January 31
(Unaudited)
public company in 1986. Its common stock is listed on the New York Stock Exchange and the Pacific Exchange under the
2005 2004
symbol “TOL”. The Company serves move-up, empty-nester, active-adult and second-home home buyers and operates in:
Revenues
Arizona, California, Colorado, Connecticut, Delaware, Florida, Illinois, Massachusetts, Maryland, Michigan, Minnesota,
Nevada, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas, and Virginia. Home sales $ 989,097 $ 589,577
Land sales 1,225 5,987
Toll Brothers builds luxury single-family detached and attached home communities, master planned luxury residential
resort-style golf communities and urban low, mid- and high-rise communities, principally on land it develops and Equity earnings in unconsolidated entities 1,935 665
improves. The Company operates its own architectural, engineering, mortgage, title, land development and land sale, golf Interest and other 6,883 1,683
course development and management, home security, landscape, cable T.V. and broadband Internet delivery subsidiaries. 999,140 597,912
The Company also operates its own lumber distribution, and house component assembly and manufacturing operations.
Costs and expenses
Toll Brothers is the only publicly traded national home building company to have won all three of the industry’s highest
Home sales 685,493 422,428
honors: America’s Best Builder, the National Housing Quality Award and Builder of the Year. The Glenhaven kitchen and back staircase at Inverness at Dublin Ranch Golf Club Dublin, California
Land sales 779 5,303
Five-Year Performance Overview Selling, general and administrative 107,065 76,653
Consolidated Condensed Balance Sheets Interest 21,812 14,558
$999.1 815,149 518,942
(Amounts in thousands)
Income before income taxes 183,991 78,970
(Unaudited)
Income taxes 73,798 28,886
Jan. 31 Oct. 31
Net income $ 110,193 $ 50,084
$597.9
Assets 2005 2004 $570.3
Cash and cash equivalents $ 340,622 $ 465,834 $475.3 $492.2
Earnings per share
Marketable securities 144,789 115,029 $110.2 $1,443 Basic $ 1.45 $ 0.68
Inventory 4,145,727 3,878,260
Diluted $ 1.33 $ 0.62
Property, construction and office equipment, net 58,176 52,429
Weighted-average number of shares
Receivables, prepaid expenses and other assets 154,050 146,212
Basic 75,826 73,839
Mortgage loans receivable 74,395 99,914 $903
Diluted 83,042 80,819
Customer deposits held in escrow 69,344 53,929 2001 2002 2003 2004 2005
Total Revenues (in millions)
Investments in and advances to unconsolidated entities 109,871 93,971 Housing data 2005 2004
$50.1
$44.5 $45.4 $583
Three Months Ended January 31 (Three months ended January 31)
$ 5,096,974 $ 4,905,578 $39.9
$444 $483
Number of homes closed 1,590 1,085
$4,888
Liabilities and Stockholders’ Equity Sales value of homes closed (in millions) $ 989,100 $ 589,600
Liabilities Number of homes contracted 2,173 1,512
Loans payable $ 372,408 $ 340,380 Sales value of homes contracted (in millions) $1, 443,100 $ 902,800
Senior notes 845,790 845,665 2001 2002 2003 2004 2005 2001 2002 2003 2004 2005
Number of homes in backlog 7,292 5,079
$2,945
Net Income (in millions) Contracts (in millions)
Senior subordinated notes 450,000 450,000 Sales value of homes in backlog (in millions) $4,887,900 $ 2,945,100
Three Months Ended January 31 Three Months Ended January 31
Mortgage company warehouse loan 64,416 92,053
Customer deposits 329,150 291,424 $1,884
Accounts payable 192,404 181,972 $1,411 $1,404
Accrued expenses 555,982 574,202
Statement On Forward-Looking Information
Income taxes payable 178,193 209,895 Certain information included herein and in other Company reports, SEC filings, statements and presentations is forward looking within the meaning
Total liabilities 2,988,343 2,985,591 of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements concerning anticipated operating results, financial
resources, changes in revenues, changes in profitability, interest expense, growth and expansion, anticipated income from joint ventures and the Toll
2001 2002 2003 2004 2005
Brothers Realty Trust Group, the ability to acquire land, the ability to secure governmental approvals and the ability to open new communities, the
Stockholders’ Equity Backlog (in millions) ability to sell homes and properties, the ability to deliver homes from backlog, the average delivered price of homes, the ability to secure materials
At January 31
Preferred stock, none issued and subcontractors, the ability to maintain the liquidity and capital necessary to expand and take advantage of future opportunities, and stock market
valuations. Such forward-looking information involves important risks and uncertainties that could significantly affect actual results and cause them
Common stock 770 770
to differ materially from expectations expressed herein and in other Company reports, SEC filings, statements and presentations. These risks and
Toll Brothers, Inc. Corporate Office
Additional paid-in capital 232,728 200,938 uncertainties include local, regional and national economic conditions, the demand for homes, domestic and international political events,
250 Gibraltar Road, Horsham, PA 19044 215-938-8000 tollbrothers.com NYSE – “TOL” uncertainties created by terrorist attacks, the effects of governmental regulation, the competitive environment in which the Company operates,
Retained earnings 1,880,923 1,770,730
fluctuations in interest rates, changes in home prices, the availability and cost of land for future growth, the availability of capital, uncertainties and
Treasury stock, at cost (5,790) (52,451) Investor Relations fluctuations in capital and securities markets, changes in tax laws and their interpretation, legal proceedings, the availability of adequate insurance at
reasonable cost, the ability of customers to finance the purchase of homes, the availability and cost of labor and materials and weather conditions.
Total stockholders’ equity 2,108,631 1,919,987 Frederick N. Cooper, Senior Vice President - Finance – 215-938-8312 fcooper@tollbrothersinc.com
$ 5,096,974 $ 4,905,578 Joseph R. Sicree, Vice President - Chief Accounting Officer – 215-938-8045 jsicree@tollbrothersinc.com For more information, visit our Web site, tollbrothers.com
MKT-670