0001558370-24-007647 | 10-Q | XBRL Viewer

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CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
CONDENSED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	90,000,000	90,000,000
Common stock, shares issued	24,852,740	24,843,494
Common stock, shares outstanding	24,316,488	24,398,429
Treasury stock, shares	536,252	445,065

INVENTORIES

3 Months Ended

Mar. 31, 2024

INVENTORIES

INVENTORIES

8. INVENTORIES

Inventories consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Raw materials	$	12,377	$	13,506
Work in progress		471		552
Finished goods		30,129		26,911
Total	$	42,977	$	40,969

Finished goods expected to be held for more than twelve months is classified as long-term and represented $8,727 and $7,793 as of March 31, 2024 and December 31, 2023, respectively. The Company has an inventory allowance of $527 and $439 as of March 31, 2024 and December 31, 2023, respectively, for finished goods expected to be held for more than twelve months.

NOTES RECEIVABLE FROM MOBILE HOME PARKS - Allowance for loan losses (Details) - MHP Notes - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Accounts, Notes, Loans and Financing Receivable [Line Items]
Allowance for loan losses, beginning of period	$ 735
Provision for loan losses	(119)	$ 205
Allowance for loan losses, end of period	$ 616	$ 205

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

SHARE-BASED COMPENSATION

3 Months Ended

Mar. 31, 2024

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

13. SHARE-BASED COMPENSATION

Pursuant to the Legacy Housing Corporation 2018 Incentive Compensation Plan (the “Plan”), the Company may issue up to 10.0 million equity awards to employees, directors, consultants and nonemployee service providers in the form of stock options, stock, restricted stock and stock appreciation rights. Stock options may be granted with a contractual life of up to ten years. At March 31, 2024, the Company had 8.7 million shares available for grant under the Plan.

Restricted Stock

The following is a summary of restricted stock award activity for the year ended December 31, 2023 and the three months ended March 31, 2024 (number of units in thousands except per unit data):


	Number of Units		Weighted Average Grant Date Fair Value Per Unit
Nonvested, January 1, 2023	42	$	6.93
Granted	1	$	23.26
Vested	(18)	$	14.98
Canceled	(17)	$	13.63
Nonvested, December 31, 2023	8	$	17.09

Nonvested, January 1, 2024	8	$	17.09
Granted	-	$	-
Vested	-	$	-
Canceled	-	$	-
Nonvested, March 31, 2024	8	$	17.09

As of March 31, 2024, approximately 8,000 shares of restricted stock remained unvested. Unrecognized compensation expense related to these restricted stock awards at March 31, 2024 was $42 and is expected to be recognized over 0.4 years. Compensation expense for restricted stock awards for the three months ended March 31, 2024 and 2023 was $37 and $66, respectively.

Stock Options

The following is a summary of option award activity for the year ended December 31, 2023 and the three months ended March 31, 2024 (number of units in thousands except per unit data):


	Number of Units	Weighted Average Exercise Price Per Unit		Weighted Average Grant Date Fair Value Per Unit		Weighted Average Remaining Contractual Life (years)	Aggregate Intrinsic Value
Outstanding, January 1, 2023	1,025	$	40.59	$	4.99	9.44
Granted	43	$	22.94	$	15.32	4.70
Exercised	(6)	$	16.01	$	8.57	—
Forfeited	(56)	$	16.01	$	8.57	—
Outstanding, December 31, 2023	1,006	$	41.35	$	5.22	8.28	$
Exercisable, December 31, 2023	96	$	42.18	$	4.76	8.44	$	—

Outstanding, January 1, 2024	1,006	$	41.35	$	5.22	8.28
Granted	—	$	—	$	—	-
Exercised	(6)	$	16.01	$	8.57	—
Forfeited	—	$	-	$	-	—
Outstanding, March 31, 2024	1,000	$	41.51	$	5.20	8.03	$
Exercisable, March 31, 2024	90	$	44.00	$	4.49	8.44	$	—

As of March 31, 2024, approximately 910,000 options remained nonvested. Unrecognized compensation expense related to these options at March 31, 2024 was $4,332 and is expected to be recognized over 8.0 years. Compensation expense for stock option awards for the three months ended March 31, 2024 and 2023 was $147 and $126, respectively.

OTHER NOTES RECEIVABLE - Impaired and general reserve for allowance for loan losses (Details) - Other Note Receivable - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding principal balance	$ 30,694	$ 35,353
Allowance for loan losses	176	236	$ 433
Impaired loans individually evaluated for impairment	24,609	25,135
Specific reserve against impaired loans	76	84
Other loans collectively evaluated for allowance	6,085	10,218
General allowance for loan losses	$ 100	$ 152

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

CONSUMER LOANS RECEIVABLE - Disaggregation of outstanding principal balance of consumer loans receivable (Details) - Consumer - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Disaggregation the outstanding principal balance of consumer loans receivable
2024	$ 7,224
2023	31,543
2022	24,793
2021	22,025
2020	13,139
Prior	63,472
Total	$ 162,196	$ 159,738
% of Portfolio	100.00%
Less than 30 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2024	$ 7,224
2023	30,879
2022	24,317
2021	21,050
2020	12,713
Prior	61,654
Total	$ 157,837
% of Portfolio	97.30%
30-90 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 509
2022	311
2021	429
2020	316
Prior	489
Total	$ 2,054
% of Portfolio	1.30%
> 90 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 155
2022	165
2021	546
2020	110
Prior	1,329
Total	$ 2,305
% of Portfolio	1.40%

NOTES RECEIVABLE FROM MOBILE HOME PARKS - Impaired and general reserve for allowance for loan losses (Details) - MHP Notes - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding principal balance	$ 184,435	$ 184,280
Allowance for loan losses	616	735	$ 205
Impaired loans individually evaluated for impairment	29,884	31,215
Specific reserve against impaired loans	5	5
Other loans collectively evaluated for allowance	154,552	153,065
General allowance for loan losses	$ 611	$ 730

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

DEALER FINANCED RECEIVABLES - net of allowance for loan losses and deferred financing fees (Details) - Dealer Finance Receivable - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2034	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Receivables
Term of deferred financing receivables	3 years
Outstanding principal balance		$ 34,207	$ 32,980
Allowance for loan losses		(166)	(442)	$ (273)	$ (13)
Total		$ 34,041	$ 32,538

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

REVENUE (Tables)

3 Months Ended

Mar. 31, 2024

REVENUE

Schedule of disaggregation of revenue


	Three months ended
	March 31,
	2024		2023
Product sales:
Direct sales	$	1,795	$	7,426
Commercial sales		13,602		15,565
Inventory finance sales		8,463		13,615
Retail store sales		4,796		3,967
Other product sales (1)		2,177		2,745
Total product sales		30,833		43,318
Consumer, MHP and dealer loans interest:
Interest - consumer installment notes		5,100		4,657
Interest - MHP notes		4,608		3,048
Interest - dealer finance notes		925		—
Total consumer, MHP and dealer loans interest		10,633		7,705
Other		1,777		1,834
Total net revenue	$	43,243	$	52,857

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

NOTES RECEIVABLE FROM MOBILE HOME PARKS - Disaggregates the outstanding principal balance of MHP receivable (Details) - MHP Notes - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Disaggregation the outstanding principal balance of consumer loans receivable
2024	$ 6,247
2023	56,098
2022	50,996
2021	34,157
2020	33,082
Prior	3,855
Total	$ 184,435	$ 184,280
% of Portfolio	100.00%
Less than 30 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2024	$ 6,247
2023	44,028
2022	46,610
2021	25,829
2020	31,134
Prior	3,855
Total	$ 157,703
% of Portfolio	85.50%
30-90 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 11,950
2022	4,340
2021	8,328
2020	1,948
Total	$ 26,566
% of Portfolio	14.40%
> 90 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 120
2022	46
Total	$ 166
% of Portfolio	0.10%

INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2024

INVENTORIES

Schedule of inventory


	As of March 31,		As of December 31,
	2024		2023
Raw materials	$	12,377	$	13,506
Work in progress		471		552
Finished goods		30,129		26,911
Total	$	42,977	$	40,969

DEALER FINANCED RECEIVABLES (Tables) - Dealer Finance Receivable

3 Months Ended

Mar. 31, 2024

Receivables

Schedule of dealer financed notes receivable, net of allowance for loan losses and deferred financing fees


	As of March 31,		As of December 31,
	2024		2023
Outstanding principal balance	$	34,207	$	32,980
Loan discount and deferred financing fees		—		—
Allowance for loan losses		(166)		(442)
Total	$	34,041	$	32,538

Schedule of allowance for loan losses


	Three months ended March 31,		Three months ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	442	$	13
Provision for loan losses		(276)		260
Charge offs (recoveries)		—		—
Allowance for loan losses, end of period	$	166	$	273

EARNINGS PER SHARE (Tables)

3 Months Ended

Mar. 31, 2024

EARNINGS PER SHARE

Summary of reconciliation of the numerators and denominators used in the computations of both basic and diluted EPS


	Three months ended
	March 31,
	2024		2023
Numerator:
Net income (in 000's)	$	15,140	$	16,276
Denominator:
Basic weighted-average common shares outstanding		24,393,003		24,374,677
Effect of dilutive securities:
Restricted stock grants		6,135		13,383
Stock options		725,878		789,442
Diluted weighted-average common shares outstanding		25,125,016		25,177,502
Earnings per share attributable to Legacy Housing Corporation
Basic	$	0.62	$	0.67
Diluted	$	0.60	$	0.65

LINES OF CREDIT

3 Months Ended

Mar. 31, 2024

LINES OF CREDIT.

LINES OF CREDIT

12. LINES OF CREDIT

On July 28, 2023, the Company entered into a new Credit Agreement (the “Revolver”), by and among the Company as borrower, the financial institutions from time to time party thereto, as lenders, and Prosperity Bank as administrative agent. Subsequently, the Company repaid in full the balance due on its prior line of credit with Capital One, N.A. and all commitments under this prior line of credit were terminated. The Revolver provides for a four-year senior secured revolving credit facility with an initial commitment of $50,000 and an additional $25,000 commitment under an accordion feature. The Revolver is secured by the Company’s consumer loans receivables and all escrow accounts associated with the consumer loans receivables. At the Company's option, borrowings will bear interest at a per annum rate equal to, (i) Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin of 2.5% or 2.75% based upon the Company's average quarterly borrowings under the Revolver or (ii) a base rate plus an applicable margin of 2.5% or 2.75% based upon the Company's average quarterly borrowings under the Revolver. The Company paid certain arrangement fees and other fees in connection with the Revolver of approximately $271, which were capitalized as unamortized debt issuance costs and included within lines of credit balance in the accompanying balance sheets and are amortized to interest expense over the life of the Revolver. The Revolver matures July 28, 2027.

For the three months ended March 31, 2024, interest expense for the under the Revolver was $276, and for the three months ended March 31, 2023, interest expense under the prior line of credit was $91. The outstanding balance of the Revolver as of March 31, 2024 and December 31, 2023 was $11,797 and $23,680, respectively. The interest rate in effect as of March 31, 2024 and December 31, 2023 for the Revolver was 7.67% and 7.95%, respectively. The amount of available credit under the Revolver was $38,203 and $26,320 as of March 31, 2024 and December 31, 2023, respectively. The Revolver requires the Company to comply with certain financial and non-financial covenants. As of March 31, 2024, the Company was in compliance with all financial covenants, including that it maintain a maximum leverage ratio of no more than 1.00 to 1.00 and a minimum fixed charge coverage ratio of no less than 1.75 to 1.00.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 470
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//470/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1E
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

+ Details

DEALER FINANCED RECEIVABLES - Allowance for loan losses (Details) - Dealer Finance Receivable - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Receivables
Allowance for loan losses, beginning of period	$ 442	$ 13
Provision for loan losses	(276)	260
Allowance for loan losses, end of period	$ 166	$ 273

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended
INCOME TAXES (Details) - USD ($) $ in Thousands	Mar. 31, 2033	Mar. 31, 2024	Mar. 31, 2023
INCOME TAXES
Tax expense	$ 3,373	$ 3,373	$ 3,435
Effective tax rate (as a percent)		18.20%	17.40%
Federal statutory rate		21.00%	21.00%

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

CONDENSED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended
CONDENSED STATEMENTS OF INCOME - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Net revenue:
Product sales	$ 30,833	$ 43,318
Consumer, MHP and dealer loans interest	10,633	7,705
Other	1,777	1,834
Total net revenue	43,243	52,857
Operating expenses:
Cost of product sales	20,466	28,960
Selling, general and administrative expenses	5,889	5,412
Dealer incentive	138	131
Total operating expenses	26,493	34,503
Income from operations	16,750	18,354
Other income (expense):
Nonoperating interest income	1,302	695
Miscellaneous, net	737	753
Interest expense	(276)	(91)
Total other income	1,763	1,357
Income before income tax expense	18,513	19,711
Income tax expense	(3,373)	(3,435)
Net income	$ 15,140	$ 16,276
Weighted average shares outstanding:
Basic (in shares)	24,393,003	24,374,677
Diluted (in shares)	25,125,016	25,177,502
Net income per share:
Basic (in dollars per share)	$ 0.62	$ 0.67
Diluted (in dollars per share)	$ 0.60	$ 0.65

NATURE OF OPERATIONS - Segment Reporting (Details)	3 Months Ended
NATURE OF OPERATIONS - Segment Reporting (Details)	Mar. 31, 2024 segment
NATURE OF OPERATIONS
Number of reportable segment	1
Number of operating segments	1

CONSUMER LOANS RECEIVABLE - Impaired and general reserve for allowance for loan losses (Details) - Consumer - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Receivables
Consumer loans receivable	$ 162,196	$ 159,738
Allowance for loan losses	564	765	$ 816	$ 830
Impaired loans individually evaluated for impairment	2,041	1,565
Specific reserve against impaired loans	554	562
Other loans collectively evaluated for allowance	160,155	158,173
General allowance for loan losses	$ 10	$ 203

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

PROPERTY, PLANT AND EQUIPMENT

3 Months Ended

Mar. 31, 2024

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

9. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Land	$	17,287	$	14,953
Buildings and leasehold improvements		13,578		13,419
Construction in Progress		12,010		11,576
Vehicles		1,571		1,571
Machinery and equipment		6,772		6,527
Furniture and fixtures		336		329
Total		51,554		48,375
Less accumulated depreciation		(10,794)		(10,495)
Total property, plant and equipment	$	40,760	$	37,880

Depreciation expense was $403 with $158 included as a component of cost of product sales for the three months ended March 31, 2024, and $270 with $126 included as a component of cost of product sales for the three months ended March 31, 2023.

ACCRUED LIABILITIES (Tables)

3 Months Ended

Mar. 31, 2024

ACCRUED LIABILITIES.

Schedule of accrued liabilities


	As of March 31,		As of December 31,
	2024		2023
Warranty reserve	$	3,314	$	2,910
Litigation reserve		610		990
Payroll		845		879
Portfolio taxes and title		2,359		2,234
Property tax		364		1,018
Dealer rebates		879		1,040
Sales tax		251		190
Federal and state income taxes		7,137		3,759
Other		4,002		5,484
Total accrued liabilities	$	19,761	$	18,504

NATURE OF OPERATIONS

3 Months Ended

Mar. 31, 2024

NATURE OF OPERATIONS

NATURE OF OPERATIONS

1. NATURE OF OPERATIONS

Legacy Housing Corporation (referred herein as ”Legacy”, “we”, “our”, “us”, or the “Company”) was formed on January 1, 2018 as a Delaware corporation through a corporate conversion of Legacy Housing, Ltd. (the “Partnership”), a Texas limited partnership formed in May 2005. Effective December 31, 2019, the Company reincorporated from a Delaware corporation to a Texas corporation. The Company is headquartered in Bedford, Texas.

The Company (1) manufactures and provides for the transport of mobile homes, (2) provides wholesale financing to dealers and mobile home parks, (3) provides retail financing to consumers and (4) is involved in financing and developing new manufactured home communities. The Company manufactures its mobile homes at plants located in Fort Worth, Texas, Commerce, Texas and Eatonton, Georgia. The Company relies on a network of dealers to market and sell its mobile homes. The Company also sells homes directly to consumers, through its own retail stores, and to dealers and mobile home parks.

Basis of Presentation

The accompanying unaudited interim condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") as required by Regulation S-X, Rule 8-03. In the opinion of management, the unaudited interim condensed financial statements have been prepared on the same basis as the audited annual financial statements, and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair statement of the Company's financial position for the periods presented. The results for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the year ending December 31, 2024, or any other period. The accompanying balance sheet as of December 31, 2023 was derived from audited financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2023 (the “Form 10-K”), filed on March 15, 2024. The accompanying financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. Accordingly, they should be read in conjunction with the audited financial statements and notes thereto included in the Form 10-K.

Use of Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Material estimates that are susceptible to significant change in the near term primarily relate to the determination and valuation of accounts receivable, loans to mobile home parks, consumer loans receivable, other notes receivable, inventory obsolescence, income taxes, fair value of financial instruments and contingent liabilities. Actual results could differ from these estimates.

Segment

The Company has one reportable segment. All of our activities are interrelated, and each activity is dependent and assessed based on how each of the activities of the Company supports the others. For example, the sale of manufactured homes includes providing transportation for dealers. We also provide financing options to the customers to facilitate such sale of homes. In addition, the sale of homes is directly related to financing provided by us. Accordingly, all significant operating and strategic decisions by the chief operating decision maker, the Chief Executive Officer, are based upon analyses of our company as one operating segment.

Revenue Recognition

Product sales primarily consist of sales of mobile homes to consumers and mobile home parks through various sales channels, which include Direct Sales, Commercial Sales, Inventory Finance Sales, and Retail Store Sales. Direct Sales include homes sold directly to independent retailers or customers that are not financed by the Company and are not sold under an inventory finance arrangement. These types of homes are generally paid for prior to shipment. Commercial Sales include homes sold to mobile home parks under commercial loan programs or paid for upfront. Inventory Finance Sales include sales of homes to independent retailers, or dealers, who then resell the homes to consumers. Retail Store Sales are homes sold through Company-owned retail locations. Inventory Finance Sales and Retail Store Sales of homes may be financed by the Company or a third party, or they may be paid in cash.

Consumer, MHP and dealer loans interest includes interest income from the consumer, MHP and dealer finance loan portfolios. Other revenue consists of consignment fees, commercial lease rents, service fees and other miscellaneous income.

Share-Based Compensation

The Company accounts for share-based compensation in accordance with the provisions of Accounting Standards Codification (“ASC”) 718, Compensation—Stock Compensation. Share-based compensation expense is recognized based on an award’s estimated grant date fair value in order to recognize compensation cost for those shares expected to vest. The Company has elected to record forfeitures as they occur. Compensation cost is recognized on a straight-line basis over the vesting period of the awards and adjusted as forfeitures occur.

The fair value of each option grant with only service-based conditions is estimated using the Black-Scholes pricing model. The fair value of each restricted stock grant with only service-based conditions is calculated based on the closing price of the Company’s common stock on the grant date.

The fair value of stock option awards on the date of grant is estimated using the Black-Scholes option pricing model, which requires the Company to make certain predictive assumptions. The risk-free interest rate is based on the implied yield of U.S. Treasury zero-coupon securities that correspond to the expected life of the award. The volatility is estimated based on the historical volatility of the Company’s common stock. The expected life of awards granted represents the period of time that the awards are expected to be outstanding based on the “simplified” method, which is allowed for companies that cannot reasonably estimate the expected life of options based on its historical award exercise experience. The Company does not expect to pay dividends on its common stock.

Accounts Receivable

“Accounts receivable, net” includes receivables from direct sales of mobile homes, sales of parts and supplies to customers, inventory finance fees and interest.

“Accounts receivable, net” related to inventory finance fees and interest generally are due upon receipt, and all other accounts receivable generally are due within 30 days. Accounts receivable “net” are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines the allowance by considering several factors, including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance for doubtful accounts for amounts that are deemed to be uncollectible. On March 31, 2024, December 31, 2023 and December 31, 2022, the allowance for doubtful accounts totaled $757, $651 and $279, respectively.

Leased Property

The Company offers mobile home park operators the opportunity to lease mobile homes for rent in lieu of purchasing the homes for cash or under a longer-term financing agreement. In this arrangement title for the mobile homes remains with the Company, and the lease is accounted for as an operating lease.

Our typical lease agreement is for 96 months or 120 months. It requires the lessee to maintain the home and to return the home to us at the end of the lease in good condition. It provides the lessee with a termination option for a fee, an option to extend the lease and a purchase option at fair market value.

The leased mobile homes are included in other assets on the Company’s balance sheet, capitalized at manufactured cost and depreciated over a 15 year useful life. Homes returned to the Company upon expiration of the lease or in the event of default are sold by the Company through its standard sales and distribution channels. Depreciation expense for the leased property was $124 and $160 for the three months ended March 31, 2024 and 2023, respectively.

During the three months ended March 31, 2024, the Company sold 120 leased mobile homes for $5.5 million to a mobile home park customer.

Future minimum lease income under all operating leases for each of the next five years at March 31, 2024, is as follows:


2024	$	901
2025		1,202
2026		1,202
2027		1,029
2028		841
Thereafter		578
Total	$	5,753

Product Warranties

The Company provides retail home buyers with a one-year warranty from the date of purchase on manufactured inventory. Product warranty costs are accrued when the covered homes are sold to customers. Product warranty expense is recognized based on the terms of the product warranty and the related estimated costs. Factors used to determine the warranty liability include the number of homes under warranty and the historical costs incurred in servicing the warranties. The accrued warranty liability is reduced as costs are incurred and the warranty liability balance is included as part of accrued liabilities in the Company’s balance sheet.

The following table summarizes activity within the warranty liability for the three months ended March 31, 2024 and 2023:


	Three Months Ended March 31,
	2024		2023
Warranty liability, beginning of period	$	2,910	$	3,048
Product warranty accrued		941		636
Warranty costs incurred		(537)		(627)
Warranty liability, end of period	$	3,314	$	3,057

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016 13 Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write down and affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. The Company used the longer phase in period for adoption, and accordingly this ASU became effective for the Company’s fiscal year beginning January 1, 2023. The adoption of ASU 2016-13 resulted in an increase in portfolio allowances of $900 at transition. The $900 was comprised of a $225 increase for MHP notes, a $187 increase for dealer financed contracts and a $488 increase for other notes receivable. The cumulative effect of the adoption was a net decrease of $698 to beginning retained earnings at January 1, 2023.

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848. The amendments in this update extend the transition relief period for reference rate reform from December 31, 2022 to December 31, 2024. The amendments in ASU 2022-06 apply to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. ASU 2022-06 was effective upon issuance. The new standard has had no material impact on the Company's financial statements.

In November, 2023 the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 aims to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 requires disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. The update also requires disclosure regarding the chief operating decision maker and expands the interim segment disclosure requirements. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. We currently are evaluating the impact of ASU 2023-07 on our financial statements.

From time to time, new accounting pronouncements are issued by the FASB and other regulatory bodies that are adopted by the Company as of the specified effective dates. Unless otherwise discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

REVENUE (Details) $ in Thousands	3 Months Ended
REVENUE (Details) $ in Thousands	Mar. 31, 2024 USD ($) item home	Mar. 31, 2023 USD ($) item
Disaggregation of revenue
Incremental costs of obtaining a contract	true
Term Of Product Warranty	1 year
Product sales	$ 30,833	$ 43,318
Number of leased mobile homes sold \| home	120
Dealer commission, reimbursed dealer expenses and other similar costs	$ 1,408	2,623
Selling, general and administrative expenses
Disaggregation of revenue
Warranty and contract costs	$ 537	$ 627
Minimum
Disaggregation of revenue
Term of lease agreement	96 months
Maximum
Disaggregation of revenue
Term of lease agreement	120 months
Revenue from contract with customer product and service benchmark \| Customer concentration risk \| Pertaining to independent third parties
Disaggregation of revenue
Number of Independent third parties \| item	2	1
Product sales		$ 5,647
Concentration risk percentage		13.00%
Revenue from contract with customer product and service benchmark \| Customer concentration risk \| Independent Third Party One
Disaggregation of revenue
Product sales	$ 5,450
Concentration risk percentage	17.70%
Revenue from contract with customer product and service benchmark \| Customer concentration risk \| Independent Third Party Two
Disaggregation of revenue
Product sales	$ 2,799
Concentration risk percentage	9.10%

FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2024

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

16. FAIR VALUE MEASUREMENTS

The Company accounts for its investments and derivative instruments in accordance with the provisions of Accounting Standards Codification (“ASC”) 820 10, Fair Value Measurement, which among other things provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level I measurement) and the lowest priority to unobservable inputs (Level III measurements). The three levels of fair value hierarchy under ASC 820 10, Fair Value Measurement, are as follows:

Level I Quoted prices are available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level II Significant observable inputs other than quoted prices in active markets for which inputs to the valuation methodology include: (1) Quoted prices for similar assets or liabilities in active markets; (2) Quoted prices for identical or similar assets or liabilities in inactive markets; (3) Inputs other than quoted prices that are observable; and (4) Inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level II input must be observable for substantially the full term of the asset or liability.

Level III Significant unobservable inputs that reflect an entity’s own assumptions that market participants would use in pricing the assets or liabilities.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The Company’s financial instruments consist primarily of cash, accounts receivable, consumer loans, MHP Notes, other notes, accounts payable, and lines of credit.

The carrying amounts of cash, accounts receivable, and accounts payable approximate their respective fair values because of the short-term maturities or expected settlement dates of these instruments. This is considered a Level I valuation technique. The lines of credit, part of the MHP Notes and part of the other notes receivables have variable interest rates that reflect market rates and their fair value approximates their carrying value. This is considered a Level II valuation technique. The Company also assessed the fair value of the consumer loans receivable, the fixed rate MHP Notes and the portion of other note receivables with fixed rates based on the discounted value of the remaining principal and interest cash flows. This is considered a Level III valuation technique. The following table shows the fair market value and book value of these portfolios as of March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Consumer loan portfolio, fair value	$	157,590	$	155,146
Consumer loan portfolio, book value		159,185		156,499
Fixed rate MHP Notes, fair value		150,269		176,270
Fixed rate MHP Notes, book value		156,278		178,724
Fixed rate other notes, fair value		22,313		34,340
Fixed rate other notes, book value		22,816		34,590

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

NOTES RECEIVABLE FROM MOBILE HOME PARKS (Tables) - Notes Receivable from Mobile Home Parks

3 Months Ended

Mar. 31, 2024

Accounts, Notes, Loans and Financing Receivable [Line Items]

Schedule of notes receivable


	As of March 31,		As of December 31,
	2024		2023
Outstanding principal balance	$	184,435	$	184,280
Loan discount and deferred financing fees		(1,257)		(1,565)
Allowance for loan losses		(616)		(735)
Total	$	182,562	$	181,980

Schedule of allowance for loan losses


	Three months ended March 31,		Three months ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	735	$	—
Provision for loan losses		(119)		205
Charge offs (recoveries)		—		—
Allowance for loan losses, end of period	$	616	$	205

Schedule of impaired and general reserve for allowance for loan losses


	As of March 31,		As of December 31,
	2024		2023
Total MHP loans	$	184,435	$	184,280
Allowance for loan losses		616		735
Impaired loans individually evaluated for impairment		29,884		31,215
Specific reserve against impaired loans		5		5
Other loans collectively evaluated for allowance		154,552		153,065
General allowance for loan losses		611		730

Schedule of disaggregation of outstanding principal balance of consumer loans receivable


	Year of Origination
	2024		2023		2022		2021		2020		Prior		Total		% of Portfolio
< 30 days past due	$	6,247	$	44,028	$	46,610	$	25,829	$	31,134	$	3,855	$	157,703	%	85.5
30-90 days past due		—		11,950		4,340		8,328		1,948		—		26,566		14.4
> 90 days past due		—		120		46		—		—		—		166		0.1
Total	$	6,247	$	56,098	$	50,996	$	34,157	$	33,082	$	3,855	$	184,435	%	100

PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
PROPERTY, PLANT AND EQUIPMENT
Total	$ 51,554		$ 48,375
Less accumulated depreciation	(10,794)		(10,495)
Total property, plant and equipment	40,760		37,880
Depreciation expense	403	$ 270
Cost of product sales
PROPERTY, PLANT AND EQUIPMENT
Depreciation expense	158	$ 126
Land
PROPERTY, PLANT AND EQUIPMENT
Total	17,287		14,953
Buildings and leasehold improvements
PROPERTY, PLANT AND EQUIPMENT
Total	13,578		13,419
Construction in Progress
PROPERTY, PLANT AND EQUIPMENT
Total	12,010		11,576
Vehicles
PROPERTY, PLANT AND EQUIPMENT
Total	1,571		1,571
Machinery and equipment
PROPERTY, PLANT AND EQUIPMENT
Total	6,772		6,527
Furniture and fixtures
PROPERTY, PLANT AND EQUIPMENT
Total	$ 336		$ 329

RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
RELATED PARTY TRANSACTIONS
Accounts receivable, net	$ 4,314		$ 4,656
Accounts payable	3,604		4,090
Home sales to related parties	43,243	$ 52,857
Related Party \| Bell Mobile Homes
RELATED PARTY TRANSACTIONS
Accounts receivable, net	189		403
Accounts payable	43		18
Home sales to related parties	1,119	479
Related Party \| Shipley Bros
RELATED PARTY TRANSACTIONS
Accounts receivable, net	0		143
Accounts payable	15		$ 67
Home sales to related parties	299	$ 632
Related Party \| Principal Shareholder
RELATED PARTY TRANSACTIONS
Accounts receivable, net	$ 1

- Definition

Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

+ References

+ Details

INCOME TAXES

3 Months Ended

Mar. 31, 2024

INCOME TAXES

INCOME TAXES

14. INCOME TAXES

The provision for income tax expense for the three months ended March 31, 2024 and 2023 was $3,373 and $3,435 respectively. The effective tax rate for the three months ended March 31, 2024 and 2023 was 18.2% and 17.4%, respectively. These rates differ from the federal statutory rate of 21% primarily due to a federal tax credit for the sale of energy efficient homes under the Internal Revenue Code §45L, partially offset by state income taxes. The §45L tax credit was initially established under the Federal Energy Policy Act of 2005 and was extended through December 31, 2032 by the Inflation Reduction Act of 2022.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 270
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

CONSUMER LOANS RECEIVABLE

3 Months Ended

Mar. 31, 2024

CONSUMER LOANS RECEIVABLE

CONSUMER LOANS RECEIVABLE

3. CONSUMER LOANS RECEIVABLE

Consumer loans receivable result from financing transactions entered into with retail consumers of mobile homes sold through independent retailers and company-owned retail locations. Consumer loans receivable generally consist of the sales price and any additional financing fees, less the buyer’s down payment. Interest income is recognized monthly per the terms of the financing agreements. The average contractual interest rate per loan was approximately 13.2% as of March 31, 2024 and December 31, 2023. Consumer loans receivable have maturities that range from 2 to 30 years.

The Company reviews loan applications in an underwriting process which considers credit history, among other things, to evaluate credit risk of the consumer and determines interest rates on approved loans based on consumer credit score, payment ability and down payment amount.

The Company uses payment history to monitor the credit quality of the consumer loans on an ongoing basis.

The Company may also receive escrow payments for property taxes and insurance included in its consumer loan collections. The liabilities associated with these escrow collections totaled $10,953 and $10,104 as of March 31, 2024 and December 31, 2023, respectively, and are included in escrow liability in the accompanying balance sheets.

Allowance for Loan Losses—Consumer Loans Receivable

The allowance for loan losses reflects management’s estimate of losses inherent in the consumer loans that may be uncollectible based upon review and evaluation of the consumer loan portfolio as of the date of the balance sheet. An allowance for loan losses is determined after giving consideration to, among other things, the loan characteristics,

including the financial condition of borrowers, the value and liquidity of collateral, delinquency and historical loss experience.

The allowance for loan losses is comprised of two components: the general reserve and specific reserves. The Company’s calculation of the general reserve considers the historical loan default rates and collateral recovery rates for the last three years and any qualitative factors both internal and external to the Company. Specific reserves are determined based on probable losses on specific classified impaired loans.

The Company’s policy is to place a loan on nonaccrual status when there is a clear indication that the borrower’s cash flow may not be sufficient to meet payments as they become due, which generally is when either principal or interest is past due and remains unpaid for more than 90 days. Management implemented this policy based on an analysis of historical data, current performance of loans and the likelihood of recovery once principal or interest payments became delinquent and were aged more than 90 days. Payments received on nonaccrual loans are accounted for on a cash basis, first to interest and then to principal, as long as the remaining book balance of the asset is deemed to be collectible. The accrual of interest resumes when the past due principal or interest payments are brought within 90 days of being current.

Impaired loans are those loans for which it is probable that the Company will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement, including scheduled principal and interest payments. Impaired loans, or portions thereof, are charged off when deemed uncollectible. A loan is generally deemed impaired if it is more than 90 days past due on principal or interest, is in bankruptcy proceedings, or is in the process of repossession. A specific reserve is created for impaired loans based on fair value of underlying collateral value, less estimated selling costs. The Company uses various factors to determine the value of the underlying collateral for impaired loans. These factors include: (1) the length of time the unit remained unsold after construction; (2) the amount of time the house was occupied; (3) the cooperation level of the borrowers (for example, loans requiring legal action or extensive field collection efforts may have a reduced value); (4) the physical location of the home; (5) the length of time the borrower has lived in the house without making payments; (6) the size of the home and market conditions; and (7) the experience and expertise of the particular dealer assisting in collection efforts.

Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell. At repossession, the collateral is recorded at the same amount as the principal balance as the loan. The fair value of the collateral is then computed based on the historical recovery rates of previously charged off loans, the loan is charged off and the loss is charged to the allowance for loan losses. At each reporting period, the fair value of the collateral is adjusted to the lower of the amount recorded at repossession or the estimated sales price less estimated costs to sell, based on current information. Repossessed homes totaled $2,940 and $2,215 as of March 31, 2024 and December 31, 2023, respectively, and are included in other assets in the accompanying balance sheets.

Consumer loans receivable, net of allowance for loan losses and deferred financing fees, consists of the following:


	As of March 31,		As of December 31,
	2024		2023
Consumer loans receivable	$	162,196	$	159,738
Loan discount and deferred financing fees		(2,447)		(2,473)
Allowance for loan losses		(564)		(765)
Consumer loans receivable, net	$	159,185	$	156,500

The following table presents a detail of the activity in the allowance for loan losses:


	Three Months Ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	765	$	830
Provision for loan losses		(268)		(70)
Charge offs		67		56
Allowance for loan losses, end of period	$	564	$	816

The following table presents impaired and general reserve for allowance for loan losses:


	As of March 31,		As of December 31,
	2024		2023
Total consumer loans	$	162,196	$	159,738
Allowance for loan losses	$	564	$	765
Impaired loans individually evaluated for impairment	$	2,041	$	1,565
Specific reserve against impaired loans	$	554	$	562
Other loans collectively evaluated for allowance	$	160,155	$	158,173
General allowance for loan losses	$	10	$	203

As of March 31, 2024 and December 31, 2023, the total principal outstanding for consumer loans on nonaccrual status was $2,041 and $1,565, respectively. A detailed aging of consumer loans receivable that are past due is as follows:


	As of March 31,			As of December 31,
	2024		%	2023		%
Total consumer loans receivable	$	162,196	100.0	$	159,738	100.0
Past due consumer loans:
31 - 60 days past due	$	1,696	1.0	$	624	0.4
61 - 90 days past due		357	0.2		149	0.1
91 - 120 days past due		414	0.3		123	0.1
Greater than 120 days past due		1,892	1.2		1,449	0.9
Total past due	$	4,359	2.7	$	2,345	1.5

We evaluate the credit quality of our consumer loan portfolio based on the aging status of the loan and by payment activity. Loan delinquency reporting generally is based on borrower payment activity relative to the contractual terms of the loan. The following table disaggregates the outstanding principal balance of consumer loans receivable by credit quality indicator based on delinquency status and fiscal year of origination:


	Year of Origination
	2024		2023		2022		2021		2020		Prior		Total		% of Portfolio
< 30 days past due	$	7,224	$	30,879	$	24,317	$	21,050	$	12,713	$	61,654	$	157,837	%	97.3
30-90 days past due		—		509		311		429		316		489		2,054		1.3
> 90 days past due		—		155		165		546		110		1,329		2,305		1.4
Total	$	7,224	$	31,543	$	24,793	$	22,025	$	13,139	$	63,472	$	162,196	%	100.0

SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions	May 09, 2024	Mar. 31, 2024	Nov. 30, 2022
SUBSEQUENT EVENTS
Value of shares authorized for repurchase			$ 10.0
Shares repurchased		91,187
Share repurchase during period value		$ 1.9
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased		8,100,000
Subsequent event
SUBSEQUENT EVENTS
Shares repurchased	170,342
Share repurchase during period value	$ 3.5

- Definition

Number of shares that have been repurchased during the period and have not been retired and are not held in treasury. Some state laws may govern the circumstances under which an entity may acquire its own stock and prescribe the accounting treatment therefore. This element is used when state law does not recognize treasury stock.

+ References + Details

- Definition

Equity impact of the value of stock that has been repurchased during the period and has not been retired and is not held in treasury. Some state laws may mandate the circumstances under which an entity may acquire its own stock and prescribe the accounting treatment therefore. This element is used when state law does not recognize treasury stock.

+ References + Details

Insider Trading Arrangements - shares	3 Months Ended
Insider Trading Arrangements - shares	Mar. 31, 2024	Dec. 31, 2023
Curtis D. Hodgson
Trading Arrangements, by Individual
Material Terms of Trading Arrangement	On March 25, 2024 Curtis D. Hodgson, the Company’s Executive Chairman of the Board, terminated a trading plan to sell up to 904,800 shares of the Company’s common stock from June 28, 2023 to June 21, 2024, subject to certain conditions.
Name	Curtis D. Hodgson
Title	Executive Chairman
Rule 10b5-1 Arrangement Terminated	true
Termination Date	March 25, 2024
Aggregate Available	904,800
Kenneth E. Shipley
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On October 20, 2023 Kenneth E. Shipley, the Company’s Executive Vice President and Director, terminated a trading plan to sell up to 278,400 shares of the Company’s common stock from July 24, 2023 to June 7, 2024, subject to certain conditions.
Name		Kenneth E. Shipley
Title		Executive Vice President and Director
Rule 10b5-1 Arrangement Terminated		true
Termination Date		October 20, 2023
Aggregate Available		278,400

OTHER ASSETS

3 Months Ended

Mar. 31, 2024

OTHER ASSETS.

OTHER ASSETS

10. OTHER ASSETS

Other assets consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Prepaid rent	$	349	$	349
Other		7		7
Repossessed homes		2,940		2,215
Total	$	3,296	$	2,571

EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2024

EARNINGS PER SHARE

EARNINGS PER SHARE

17. EARNINGS PER SHARE

Basic earnings per common share (“EPS”) is computed based on the weighted-average number of common shares outstanding during the reporting period. Basic weighted average common shares outstanding do not include shares of restricted stock that have not yet vested, although such shares are included as outstanding shares in the Company’s balance sheets. Diluted EPS is based on the weighted-average number of common shares outstanding plus the number of additional shares that would have been outstanding had the dilutive common shares been issued. The following table reconciles the numerators and denominators used in the computations of both basic and diluted EPS.


	Three months ended
	March 31,
	2024		2023
Numerator:
Net income (in 000's)	$	15,140	$	16,276
Denominator:
Basic weighted-average common shares outstanding		24,393,003		24,374,677
Effect of dilutive securities:
Restricted stock grants		6,135		13,383
Stock options		725,878		789,442
Diluted weighted-average common shares outstanding		25,125,016		25,177,502
Earnings per share attributable to Legacy Housing Corporation
Basic	$	0.62	$	0.67
Diluted	$	0.60	$	0.65

In November 2022, our Board of Directors approved a share repurchase program to authorize the repurchase of up to $10.0 million of the Company’s common stock. We repurchased 91,187 shares for $1.9 million in the open market during the three months ended March 31, 2024. As of March 31, 2024, we had a remaining authorization of approximately $8.1 million. Between April 1, 2024 and May 9, 2024, we repurchased 170,342 shares for $3.5 million in the open market.

NOTES RECEIVABLE FROM MOBILE HOME PARKS - Narrative (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2024 USD ($) item	Mar. 31, 2023 USD ($)	Dec. 31, 2023 USD ($) item
Receivables
Accrued interest rate	17.50%
Default loans included in notes receivable from MHP	$ 26,000
Default loans included in other notes receivable	10,000
Property and homes, foreclosed amount included in property, plant and equipment	$ 2,300
Notes Receivable from Mobile Home Parks
Receivables
Interest rate on the MHP Notes	8.00%		8.00%
Unamortized finance fees	$ 1		$ 1,565
Charge offs	0	$ 0
Allowance for loan losses	616	$ 205	735
Outstanding principal balance	$ 184,435		$ 184,280
Accrued interest rate	17.50%
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Pertaining to independent third parties
Receivables
Number of Independent third parties \| item	3		3
Notes Receivable from Mobile Home Parks \| Financial Asset, Past Due [Member]
Receivables
Outstanding principal balance	$ 262		$ 98
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Independent third party and affiliates one
Receivables
Percentage of concentration risk	24.00%		24.50%
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Independent third party and affiliates two
Receivables
Percentage of concentration risk	17.20%		17.90%
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Independent third party and affiliates three
Receivables
Percentage of concentration risk	13.40%		14.00%
MHP and Other Notes Receivable \| Credit concentration risk \| Independent third party and affiliates one \| Independent Third Party One
Receivables
Outstanding principal balance	$ 54,000
Receivables currently in default and are the subject of ongoing litigation	$ 36,000
Minimum \| Notes Receivable from Mobile Home Parks
Receivables
Fixed rate of interest (as a percent)	6.90%
Term of notes receivables	1 year
Maximum \| Notes Receivable from Mobile Home Parks
Receivables
Fixed rate of interest (as a percent)	12.50%
Term of notes receivables	10 years

LEASES - Narrative (Details) $ in Thousands	3 Months Ended
LEASES - Narrative (Details) $ in Thousands	Mar. 31, 2024 USD ($) lease
LEASES
Number of operating leases	13
Number of operating leases subleased	3
Operating lease, term of contract (in years)	10 years
Options to renew	true
Operating lease weighted average remaining lease term	3 years 9 months 18 days
Weighted Average Discount Rate	2.10%
Variable lease cost \| $	$ 0
Minimum
LEASES
Operating lease, term of contract (in years)	5 years
Maximum
LEASES
Operating lease, term of contract (in years)	10 years
Heritage Housing and Tiny Homes retail locations
LEASES
Number of operating leases	8
Corporate and administrative offices in Bedford, TX and Norcross, GA
LEASES
Number of operating leases subleased	2

COMMITMENTS AND CONTINGENCIES - Leases (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	10 years
Rent expense	$ 159	$ 182
Sublease rental Income	$ 54	$ 67
Minimum
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	5 years
Sublease, term of contract (in years)	3 years
Maximum
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	10 years
Sublease, term of contract (in years)	11 years

DEALER FINANCED RECEIVABLES

3 Months Ended

Mar. 31, 2024

DEALER FINANCED RECEIVABLES

DEALER FINANCED RECEIVABLES

6. DEALER FINANCED RECEIVABLES

Dealer finance receivable are receivables for loans that we make to independent retailers, or dealers, for the purchase of mobile homes so that dealers can then market them for sale to consumers. The loans are part of our inventory finance program. In late 2022 and early 2023, the Company transitioned many of its dealers from a traditional consignment arrangement to an inventory finance arrangement. The terms of the financing typically include a three year term, a monthly interest payment, an annual curtailment payment and require the retailer to pay the principal amount of the loan to the Company upon the earlier of the sale of the home by the retailer to its customer or the end of the term.

Dealer financed notes receivable, net of allowance for loan losses and deferred financing fees, consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Outstanding principal balance	$	34,207	$	32,980
Loan discount and deferred financing fees		—		—
Allowance for loan losses		(166)		(442)
Total	$	34,041	$	32,538

The following table presents a detail of the activity in the allowance for loan losses for the three months ended March 31, 2024 and 2023:


	Three months ended March 31,		Three months ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	442	$	13
Provision for loan losses		(276)		260
Charge offs (recoveries)		—		—
Allowance for loan losses, end of period	$	166	$	273

The dealer financed loan portfolio was established primarily in late 2022 and 2023 as a result of converting from consignment arrangements with dealers to inventory finance arrangements with dealers. As such, there is relatively little historical data to measure credit quality of the loans in this portfolio.

NATURE OF OPERATIONS - Leased Property - Future minimum lease income (Details) $ in Thousands	Mar. 31, 2024 USD ($)
Operating Leases, Future Minimum Payments Receivable [Abstract]
2024	$ 901
2025	1,202
2026	1,202
2027	1,029
2028	841
Thereafter	578
Total	$ 5,753

NOTES RECEIVABLE FROM MOBILE HOME PARKS - Notes receivable from mobile home parks (Details) - MHP Notes - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding principal balance	$ 184,435	$ 184,280
Loan discount and deferred financing fees	(1,257)	(1,565)
Allowance for loan losses	(616)	(735)	$ (205)
Total	$ 182,562	$ 181,980

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

LEASES - Future minimum lease payments (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
LEASES
2024	$ 373
2025	494
2026	431
2027	345
2028	145
Total lease payments	1,788
Less amount representing interest	(40)
Total lease liability	1,748
Less current lease liability	(474)	$ (489)
Total non-current lease liability	$ 1,274	$ 1,396

EARNINGS PER SHARE - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	May 09, 2034	Mar. 31, 2024	Nov. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Value of shares authorized for repurchase			$ 10,000
Shares repurchased (in shares)		91,187
Payments for repurchase of shares		$ 1,871
Remaining value of shares to be purchased under share repurchase program		$ 8,100
Subsequent event
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Shares repurchased (in shares)	170,342
Payments for repurchase of shares	$ 3,500

SHARE-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2024

SHARE-BASED COMPENSATION

Schedule of restricted stock units activity

The following is a summary of restricted stock award activity for the year ended December 31, 2023 and the three months ended March 31, 2024 (number of units in thousands except per unit data):


	Number of Units		Weighted Average Grant Date Fair Value Per Unit
Nonvested, January 1, 2023	42	$	6.93
Granted	1	$	23.26
Vested	(18)	$	14.98
Canceled	(17)	$	13.63
Nonvested, December 31, 2023	8	$	17.09

Nonvested, January 1, 2024	8	$	17.09
Granted	-	$	-
Vested	-	$	-
Canceled	-	$	-
Nonvested, March 31, 2024	8	$	17.09

Schedule of stock option activity

The following is a summary of option award activity for the year ended December 31, 2023 and the three months ended March 31, 2024 (number of units in thousands except per unit data):


	Number of Units	Weighted Average Exercise Price Per Unit		Weighted Average Grant Date Fair Value Per Unit		Weighted Average Remaining Contractual Life (years)	Aggregate Intrinsic Value
Outstanding, January 1, 2023	1,025	$	40.59	$	4.99	9.44
Granted	43	$	22.94	$	15.32	4.70
Exercised	(6)	$	16.01	$	8.57	—
Forfeited	(56)	$	16.01	$	8.57	—
Outstanding, December 31, 2023	1,006	$	41.35	$	5.22	8.28	$
Exercisable, December 31, 2023	96	$	42.18	$	4.76	8.44	$	—

Outstanding, January 1, 2024	1,006	$	41.35	$	5.22	8.28
Granted	—	$	—	$	—	-
Exercised	(6)	$	16.01	$	8.57	—
Forfeited	—	$	-	$	-	—
Outstanding, March 31, 2024	1,000	$	41.51	$	5.20	8.03	$
Exercisable, March 31, 2024	90	$	44.00	$	4.49	8.44	$	—

NATURE OF OPERATIONS - Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Jan. 01, 2023
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Retained earnings	$ 274,898	$ 259,758
Cumulative effect, period of adoption, adjustment \| ASU 2016-13
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for loan losses				$ 900
Retained earnings				698
MHP Notes
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for loan losses	616	735	$ 205
MHP Notes \| Cumulative effect, period of adoption, adjustment \| ASU 2016-13
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for loan losses				225
Deal financed contracts \| Cumulative effect, period of adoption, adjustment \| ASU 2016-13
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for loan losses				187
Other Note Receivable
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for loan losses	$ 176	$ 236	$ 433
Other Note Receivable \| Cumulative effect, period of adoption, adjustment \| ASU 2016-13
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Allowance for loan losses				$ 488

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

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+ Details

- Definition

Amount of accumulated undistributed earnings (deficit).

+ References + Details

CONSUMER LOANS RECEIVABLE (Tables) - Consumer

3 Months Ended

Mar. 31, 2024

Receivables

Schedule of dealer financed notes receivable, net of allowance for loan losses and deferred financing fees


	As of March 31,		As of December 31,
	2024		2023
Consumer loans receivable	$	162,196	$	159,738
Loan discount and deferred financing fees		(2,447)		(2,473)
Allowance for loan losses		(564)		(765)
Consumer loans receivable, net	$	159,185	$	156,500

Schedule of allowance for loan losses


	Three Months Ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	765	$	830
Provision for loan losses		(268)		(70)
Charge offs		67		56
Allowance for loan losses, end of period	$	564	$	816

Schedule of impaired and general reserve for allowance for loan losses


	As of March 31,		As of December 31,
	2024		2023
Total consumer loans	$	162,196	$	159,738
Allowance for loan losses	$	564	$	765
Impaired loans individually evaluated for impairment	$	2,041	$	1,565
Specific reserve against impaired loans	$	554	$	562
Other loans collectively evaluated for allowance	$	160,155	$	158,173
General allowance for loan losses	$	10	$	203

Schedule of consumer loans receivable that are past due


	As of March 31,			As of December 31,
	2024		%	2023		%
Total consumer loans receivable	$	162,196	100.0	$	159,738	100.0
Past due consumer loans:
31 - 60 days past due	$	1,696	1.0	$	624	0.4
61 - 90 days past due		357	0.2		149	0.1
91 - 120 days past due		414	0.3		123	0.1
Greater than 120 days past due		1,892	1.2		1,449	0.9
Total past due	$	4,359	2.7	$	2,345	1.5

Schedule of disaggregation of outstanding principal balance of consumer loans receivable


	Year of Origination
	2024		2023		2022		2021		2020		Prior		Total		% of Portfolio
< 30 days past due	$	7,224	$	30,879	$	24,317	$	21,050	$	12,713	$	61,654	$	157,837	%	97.3
30-90 days past due		—		509		311		429		316		489		2,054		1.3
> 90 days past due		—		155		165		546		110		1,329		2,305		1.4
Total	$	7,224	$	31,543	$	24,793	$	22,025	$	13,139	$	63,472	$	162,196	%	100.0

RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2024

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

18. RELATED PARTY TRANSACTIONS

Bell Mobile Homes (“Bell”), a retailer owned by one of the Company’s significant stockholders, purchases manufactured homes from the Company. Accounts receivable balances due from Bell were $189 and $403 as of March 31, 2024 and December 31, 2023, respectively. Accounts payable balances due to Bell were $43 and $18 as of March 31, 2024 and December 31, 2023, respectively. Home sales to Bell were $1,119 and $479 for the three months ended March 31, 2024 and 2023, respectively.

Shipley Bros., Ltd. And Crazy Red’s Mobile Homes (together, “Shipley”), retailers owned by one of the Company’s significant shareholders, purchase manufactured homes from the Company. Accounts receivable balances due from Shipley were $0 and $143 as of March 31, 2024 and December 31, 2023, respectively. Accounts payable balances due to Shipley were $15 and $67 as of March 31, 2024 and December 31, 2023. Home sales to Shipley were $299 and $632 for the three months ended March 31, 2024 and 2023, respectively.

At March 31, 2024, the Company had a receivable of $1 from a principal shareholder. This amount is included in the Company’s accounts receivable balance as of March 31, 2024.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483326/850-10-50-1

+ Details

COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2024

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

15. COMMITMENTS AND CONTINGENCIES

As of January 1, 2020, the Company instituted a self-insured health benefits plan with a stop-loss policy, which provides medical benefits to employees electing coverage under the plan. The Company estimates and records costs for incurred but not reported medical claims and claim development. This reserve is based on historical experience and other assumptions, some of which are subjective. The Company will adjust its self-insured medical benefits reserve based on actual experience, estimated costs and changes to assumptions. As of March 31, 2024 and December 31, 2023, the Company accrued a $253 and $242 liability for incurred but not reported claims, respectively. These accrued amounts are included in accrued liabilities on the accompanying balance sheets.

The Company is contingently liable under terms of repurchase agreements with financial institutions providing inventory financing for independent retailers of its products. These arrangements, which are customary in the industry, provide for the repurchase of products sold to retailers in the event of default by the retailer. The Company’s obligation under these repurchase agreements ceases upon the purchase of the home by the retail customer. The Company believes that risk of loss is mitigated due to the resale value of the repurchased homes and the fact that the agreements are spread over many retailers. The maximum amount for which the Company was liable under such agreements approximated $1,671 and $3,030 at March 31, 2024 and December 31, 2023, respectively, without reduction for the resale value of the homes. The Company considers its obligations on current contracts to be immaterial and accordingly has not recorded any reserve for repurchase commitment as of March 31, 2024 and December 31, 2023.

Leases. The Company leases facilities under operating leases that typically have 10 year terms. These leases usually offer the Company a right of first refusal that affords the Company the option to purchase the leased premises under certain terms in the event the landlord attempts to sell the leased premises to a third party. Rent expense was $159 and $182 for the three months ended March 31, 2024 and 2023, respectively. The Company also subleases properties to third parties, ranging from 3-year to 11-year terms with various renewal options. Rental income from the subleased properties was approximately $54 and $67 for the three months ended March 31, 2024 and 2023, respectively. See Note 7 – Leases, for a schedule of the Company’s future minimum lease commitments.

Legal Matters

The Company is party to certain legal proceedings that arise in the ordinary course and are incidental to its business. Certain of the claims pending against the Company in these proceedings allege, among other things, breach of contract and warranty, product liability and personal injury. The Company has determined that it is probable that it has some liability related to the claims. The Company has included legal reserves of $610 and $990 as of March 31, 2024 and December 31, 2023, respectively, in accrued liabilities on the accompanying balance sheets. Although litigation is inherently uncertain, based on past experience and the information currently available, management does not believe that the currently pending and threatened litigation or claims will have a material adverse effect on the Company’s financial position, liquidity or results of operations. However, future events or circumstances currently unknown to management will determine whether the resolution of pending or threatened litigation or claims will ultimately have a material effect on the Company’s financial position, liquidity or results of operations in any future reporting periods.

OTHER NOTES RECEIVABLE - Disaggregation of outstanding principal balance of Other notes receivable (Details) - Other Note Receivable - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 28,767
2022	695
2021	831
2020	300
Prior	101
Total	$ 30,694	$ 35,353
% of Portfolio	100.00%
Less than 30 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 17,493
2022	466
2020	300
Prior	101
Total	$ 18,360
% of Portfolio	59.80%
30-90 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2023	$ 11,274
2022	229
2021	183
Total	$ 11,686
% of Portfolio	38.10%
> 90 days past due
Disaggregation the outstanding principal balance of consumer loans receivable
2021	$ 648
Total	$ 648
% of Portfolio	2.10%

LEASES

3 Months Ended

Mar. 31, 2024

LEASES

LEASES

7. LEASES

The Company currently has 13 operating leases, eight of which are for the Company’s Heritage Housing and Tiny Homes retail locations, three are subleased by the Company and two are for corporate and administrative offices in Bedford, TX and Norcross, GA. These leases typically have initial terms ranging from 5 to 10 years and include one or more options to renew.

Under ASC 842, the Company elected the modified retrospective approach, applying the new standard to all leases at the date of initial application. The Company adopted the new standard on January 1, 2022.

We determine if an arrangement is or contains a lease at inception. Operating leases are right-of-use (“ROU”) assets and are shown as ROU assets – operating leases on our balance sheets. The lease liabilities are shown as Operating lease obligation and Operating lease obligation, less current portion on our balance sheets. ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease.

ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. We have elected the practical expedient to not separate lease and non-lease components. Therefore, lease payments included in the measurement of the lease liability include all fixed payments in the lease arrangement. We record a ROU asset for an amount equal to the lease liability, increased for any prepaid lease costs and initial direct costs and reduced by any lease incentives. We remeasure the lease liability and ROU asset when a change to our future minimum lease payments occurs. Key assumptions and judgments included in the determination of the lease liability include the discount rate used in the present value calculation and the exercise of renewal options.

Many of our leases contain renewal options. As the exercise of the renewal options is not likely at the commencement of a lease, we generally do not include the option periods in the lease term when determining the lease liabilities and ROU assets. We remeasure the lease liability and ROU asset when it is reasonably likely that we will exercise a renewal option.

Our leases do not provide information about the rate implicit in the lease. Therefore, we utilize an incremental borrowing rate to calculate the present value of our future lease obligations. The incremental borrowing rate represents the rate of interest we would otherwise pay on a collateralized borrowing, for an amount equal to the lease payments, over a similar term and in a similar economic environment. As of March 31, 2024, the remaining weighted-average lease term is 3.80 years and the weighted-average discount rate is 2.10%.

We consider lease payments that cannot be predicted with reasonable certainty upon lease commencement to be variable lease payments, which are recorded as incurred each period and are excluded from our calculation of lease liabilities. There were no variable lease costs for the year ended March 31, 2024.

Short-term leases, those with a term of 12 months or less, are not recorded on our balance sheet. Our short-term lease costs were not material for the year ended March 31, 2024.

Lease expense for operating leases consists of fixed lease payments recognized on a straight-line basis over the lease term plus variable lease payments as incurred. Amortization of the ROU asset for operating leases reflects amortization of the lease liability, any differences between straight-line expense and related lease payments during the accounting period, and any impairments.

As of March 31, 2024, present value of future lease payments under our operating lease liabilities were as follows:


2024	$	373
2025		494
2026		431
2027		345
2028		145
Thereafter		—
Total lease payments	$	1,788
Less amount representing interest		(40)
Total lease liability	$	1,748
Less current lease liability		(474)
Total non-current lease liability	$	1,274

SHARE-BASED COMPENSATION - Restricted stock units (Details) - Restricted stock grants - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Number of units
Nonvested at the beginning	8,000	42,000	42,000
Granted			1,000
Vested			(18,000)
Canceled			(17,000)
Nonvested at the end	8,000		8,000
Weighted average grant date fair value
Nonvested at the beginning (in dollars per share)	$ 17.09	$ 6.93	$ 6.93
Granted (in dollars per share)			23.26
Vested (in dollars per share)			14.98
Canceled (in dollars per share)			13.63
Nonvested at the end (in dollars per share)	$ 17.09		$ 17.09
Unrecognized compensation expense	$ 42
Unrecognized compensation expense, recognition period	4 months 24 days
Share based compensation expense	$ 37	$ 66

INVENTORIES (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
INVENTORIES
Raw materials	$ 12,377	$ 13,506
Work in progress	471	552
Finished goods	30,129	26,911
Total	42,977	40,969
Inventories, net	8,727	7,793
Inventory allowance for finished goods	$ 527	$ 439

ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
ACCRUED LIABILITIES.
Warranty reserve	$ 3,314	$ 2,910
Litigation reserve	610	990
Payroll	845	879
Portfolio taxes and title	2,359	2,234
Property tax	364	1,018
Dealer rebates	879	1,040
Sales tax	251	190
Federal and state income taxes	7,137	3,759
Other	4,002	5,484
Total accrued liabilities	$ 19,761	$ 18,504

NATURE OF OPERATIONS - Accounts Receivable (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Accounts Receivable
Credit period	30 days
Allowance for doubtful accounts	$ 757	$ 651	$ 279

LEASES (Tables)

3 Months Ended

Mar. 31, 2024

LEASES

Schedule of present value of future lease payments under operating lease liabilities


2024	$	373
2025		494
2026		431
2027		345
2028		145
Thereafter		—
Total lease payments	$	1,788
Less amount representing interest		(40)
Total lease liability	$	1,748
Less current lease liability		(474)
Total non-current lease liability	$	1,274

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Commitment
Self-insured liability	$ 253	$ 242
Repurchase agreements \| Maximum
Commitment
Repurchase commitment	$ 1,671	$ 3,030

REVENUE

3 Months Ended

Mar. 31, 2024

REVENUE

REVENUE

2. REVENUE

Sales are homes sold through Company-owned retail locations. Inventory Finance Sales and Retail Store Sales of homes may be financed by the Company or a third party, or they may be paid in cash.

Revenue from product sales is recognized when the performance obligation under the terms of a contract with our customer is satisfied, which typically occurs upon delivery and transfer of title of the home, as this depicts when control of the promised good is transferred to our customers.

For inventory financed sales, the independent dealer enters into a financing arrangement with the Company and is required to make monthly interest payments. Interest income is recorded separately in the statement of income. For other financed sales by the Company, the individual customer enters into a sales and financing contract and is required to make a down payment. These financed sales contain a significant financing component and any interest income is recorded separately in the statement of income.

Revenue is measured as the amount of consideration expected to be received in exchange for transferring the homes to the customers. Sales and other similar taxes collected concurrently with revenue-producing activities are excluded from revenue.

The Company made an accounting policy election to account for any shipping and handling costs that occur after the transfer of control as a fulfillment cost that is accrued when control is transferred. Warranty obligations associated with the sale of a unit are assurance-type warranties for a period of twelve months that are a guarantee of the home’s intended functionality and, therefore, do not represent a distinct performance obligation within the context of the contract. The Company has elected to use the practical expedient to expense the incremental costs of obtaining a contract if the amortization period of the asset that the Company would have otherwise recognized is one year or less. Contract costs, which include commissions incurred related to the sale of homes, are expensed at the point-in-time when the related revenue is recognized. Warranty costs and contract costs are included in selling, general and administrative expenses in the statements of income. Warranty and contract costs were $537 and $627 for the three months ended March 31, 2024 and 2023, respectively.

For the three months ended March 31, 2024, mobile home park (“MHP”) sales to two independent third parties and their affiliates accounted for $5,450 or 17.7% and $2,799 or 9.1% of our product sales. The $5,450 represents sales of 120 leased mobile homes to a mobile home park customer, and these sales are included in Commercial Sales in the Disaggregation of Revenue table below. For the three months ended March 31, 2023, mobile home park (“MHP”) sales to an independent third party and its affiliates accounted for $5,647 or 13.0% of our product sales. No other customer accounted for more than 5.0% of our product sales.

For the three months ended March 31, 2024 and 2023, total cost of product sales included $1,408 and $2,623 of costs relating to subcontracted production for commercial sales, transportation and delivery costs, and certain other costs incurred for retail store and commercial sales.

Other revenue consists of contract deposit forfeitures, consignment fees, commercial lease rents, service fees and other miscellaneous income. Consignment fees are charged to independent retailers on a monthly basis for homes held by the independent retailers pursuant to a consignment arrangement until the home is sold to an individual customer. Consignment fees are determined as a percentage of the home’s wholesale price to the independent dealer. Revenue recognition for consignment fees is recognized over time using the output method as it provides a faithful depiction of the Company’s performance toward completion of the performance obligation under the contract and the value transferred to the independent retailer for the time the home is held under consignment. The Company transitioned most of its independent retailers from consignment arrangements to inventory finance arrangements in late 2022. As a result, consignment fees transitioned to interest income for inventory finance arrangements, and this interest income is included in Consumer, MHP and dealer loans interest on the accompanying statement of income. Revenue for commercial leases is recognized as earned monthly over a contractual period of 96 or 120 months. Revenue for service fees and miscellaneous income is recognized at a point in time when the performance obligation is satisfied.

Disaggregation of Revenue. The following table summarizes customer contract revenues disaggregated by the source of the revenue for the three months ended March 31, 2024 and 2023:


	Three months ended
	March 31,
	2024		2023
Product sales:
Direct sales	$	1,795	$	7,426
Commercial sales		13,602		15,565
Inventory finance sales		8,463		13,615
Retail store sales		4,796		3,967
Other product sales (1)		2,177		2,745
Total product sales		30,833		43,318
Consumer, MHP and dealer loans interest:
Interest - consumer installment notes		5,100		4,657
Interest - MHP notes		4,608		3,048
Interest - dealer finance notes		925		—
Total consumer, MHP and dealer loans interest		10,633		7,705
Other		1,777		1,834
Total net revenue	$	43,243	$	52,857

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org//606/tableOfContent

+ Details

OTHER NOTES RECEIVABLE

3 Months Ended

Mar. 31, 2024

OTHER NOTES RECEIVABLE

OTHER NOTES RECEIVABLE

5. OTHER NOTES RECEIVABLE

Other notes receivable relate to notes issued to mobile home park owners and dealers and are not directly tied to the sale of mobile homes. These other notes have varying maturity dates and generally require monthly principal and interest payments. They are collateralized by mortgages on real estate, mobile homes that we have financed for which the borrower uses as offices, as well as vehicles. These notes typically are personally guaranteed by the borrowers. The interest rates on the other notes generally are fixed and range from 5.00% to 17.90%. The Company reserves for estimated losses on the other notes based on current economic conditions that may affect the borrower’s ability to pay, the borrower’s financial strength, and historical loss experience.

As of March 31, 2024 and December 31, 2023 there were past due balances of $286 and $22, respectively, on the other notes excluding the Default Loans, as defined below. For the three months ended March 31, 2024 and 2023, there were no charge offs recorded for other notes. Allowance for loan loss for the other notes was $176 and $236 as of March 31, 2024 and December 31, 2023, respectively. As of March 31, 2024 and December 31, 2023, the impaired balance of other notes was $76 and $84, respectively. Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell.

Approximately $54 million of MHP Notes and Other notes receivable is with borrowers either owned or operated by one individual. Approximately $36 million of these notes currently is in default (the “Default Loans” as defined in Note 4 above) and is the subject of ongoing litigation in which the Company is the plaintiff. These notes are collateralized by mobile homes and land and are personally guaranteed by multiple borrowers. The Company evaluated the recoverability of these notes as of March 31, 2024 and determined a provision for expected loan losses is not deemed necessary based on the analysis of the underlying collateral. The Company accelerated the Default Loans at the end of January, 2024. Upon acceleration, the loans accrue interest at a rate of 17.5% and are due on demand. At March 31, 2024 the Default Loans are presented on the accompanying balance sheets under the heading Current assets, with $26 million in Current portion of notes receivable from mobile home parks (“MHP”) and $10 million in Current portion of other notes receivable. During the three months ended March 31, 2024, the Company foreclosed on property and homes of $2.3 million that is included on the accompanying balance sheets in Property, plant and equipment, net.

Other notes receivable, net of allowance for loan losses and deferred financing fees, consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Outstanding principal balance	$	30,694	$	35,353
Loan discount and deferred financing fees		(323)		(527)
Allowance for loan losses		(176)		(236)
Total	$	30,195	$	34,590

The following table presents a detail of the activity in the allowance for loan losses for the three months ended March 31, 2024 and 2023:


	Three months ended March 31,		Three months ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	236	$	—
Provision for loan losses		(60)		433
Charge offs (recoveries)		—		—
Allowance for loan losses, end of period	$	176	$	433

The following table presents impaired and general reserve for allowance for loan losses at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Total Other notes receivable	$	30,694	$	35,353
Allowance for loan losses		176		236
Impaired loans individually evaluated for impairment		24,609		25,135
Specific reserve against impaired loans		76		84
Other notes receivable collectively evaluated for allowance		6,085		10,218
General allowance for loan losses		100		152

We evaluate the credit quality of our Other notes receivable portfolio based on the aging status of the loan and by payment activity. Loan delinquency reporting is generally based upon borrower payment activity, relative to the contractual terms of the loan. The following table disaggregates the outstanding principal balance of Other notes receivable by credit quality indicator based on delinquency status and fiscal year of origination and is presented as of March 31, 2024:


	Year of Origination
	2024		2023		2022		2021		2020		Prior		Total		% of Portfolio
< 30 days past due	$	—	$	17,493	$	466	$	—	$	300	$	101	$	18,360	%	59.8
30-90 days past due		—		11,274		229		183		—		—		11,686		38.1
> 90 days past due		—		—		—		648		—		—		648		2.1
Total	$	—	$	28,767	$	695	$	831	$	300	$	101	$	30,694	%	100.0

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock Cumulative Effect, Period of Adoption, Adjusted Balance	Common Stock	Treasury stock Cumulative Effect, Period of Adoption, Adjusted Balance	Treasury stock	Additional paid-in-capital Cumulative Effect, Period of Adoption, Adjusted Balance	Additional paid-in-capital	Retained earnings Cumulative effect, period of adoption, adjustment	Retained earnings Cumulative Effect, Period of Adoption, Adjusted Balance	Retained earnings	Cumulative effect, period of adoption, adjustment	Cumulative Effect, Period of Adoption, Adjusted Balance	Total
Beginning Balance at Dec. 31, 2022	$ 30	$ 30	$ (4,477)	$ (4,477)	$ 180,555	$ 180,555	$ (698)	$ 205,298	$ 205,996	$ (698)	$ 381,406	$ 382,104
Beginning Balance (in shares) at Dec. 31, 2022	24,814,695	24,814,695
Share based compensation						191						191
Share based compensation (in shares)		8,571
Net income									16,276			16,276
Ending Balance at Mar. 31, 2023		$ 30		(4,477)		180,746			221,574			397,873
Ending Balance (in shares) at Mar. 31, 2023		24,823,266
Beginning Balance at Dec. 31, 2022	$ 30	$ 30	$ (4,477)	(4,477)	$ 180,555	180,555	$ (698)	$ 205,298	205,996	$ (698)	$ 381,406	382,104
Beginning Balance (in shares) at Dec. 31, 2022	24,814,695	24,814,695
Ending Balance at Dec. 31, 2023		$ 30		(4,477)		181,424			259,758			$ 436,735
Ending Balance (in shares) at Dec. 31, 2023		24,843,494										24,843,494
Share based compensation						257						$ 257
Share based compensation (in shares)		3,000
Purchase of treasury stock				(1,871)								(1,871)
Proceeds from exercise of stock options		$ 1				99						100
Proceeds from exercise of stock options (in shares)		6,246
Net income									15,140			15,140
Ending Balance at Mar. 31, 2024		$ 31		$ (6,348)		$ 181,780			$ 274,898			$ 450,361
Ending Balance (in shares) at Mar. 31, 2024		24,852,740										24,852,740

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 825
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 28
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482907/825-10-50-28

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 220
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482765/220-10-50-6

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-3

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 65
-Paragraph 1
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480175/815-40-65-1

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 8
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-8

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147483443/250-10-50-9

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 250
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
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+ Details

- Definition

Amount of equity (deficit) attributable to parent. Excludes temporary equity and equity attributable to noncontrolling interest.

+ References

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+ Details

NATURE OF OPERATIONS (Policies)

3 Months Ended

Mar. 31, 2024

NATURE OF OPERATIONS

Basis of Presentation

Use of Estimates

Segment

Revenue Recognition

Share-Based Compensation

Accounts Receivable

“Accounts receivable, net” includes receivables from direct sales of mobile homes, sales of parts and supplies to customers, inventory finance fees and interest.

Leased Property

During the three months ended March 31, 2024, the Company sold 120 leased mobile homes for $5.5 million to a mobile home park customer.

Future minimum lease income under all operating leases for each of the next five years at March 31, 2024, is as follows:


2024	$	901
2025		1,202
2026		1,202
2027		1,029
2028		841
Thereafter		578
Total	$	5,753

Product Warranties

The following table summarizes activity within the warranty liability for the three months ended March 31, 2024 and 2023:


	Three Months Ended March 31,
	2024		2023
Warranty liability, beginning of period	$	2,910	$	3,048
Product warranty accrued		941		636
Warranty costs incurred		(537)		(627)
Warranty liability, end of period	$	3,314	$	3,057

Recent Accounting Pronouncements

Fair Value Measurements

Level I Quoted prices are available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level III Significant unobservable inputs that reflect an entity’s own assumptions that market participants would use in pricing the assets or liabilities.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

NATURE OF OPERATIONS (Tables)

3 Months Ended

Mar. 31, 2024

NATURE OF OPERATIONS

Schedule of future minimum lease income

During the three months ended March 31, 2024, the Company sold 120 leased mobile homes for $5.5 million to a mobile home park customer.

Future minimum lease income under all operating leases for each of the next five years at March 31, 2024, is as follows:


2024	$	901
2025		1,202
2026		1,202
2027		1,029
2028		841
Thereafter		578
Total	$	5,753

Schedule of the activity within the warranty liability account


	Three Months Ended March 31,
	2024		2023
Warranty liability, beginning of period	$	2,910	$	3,048
Product warranty accrued		941		636
Warranty costs incurred		(537)		(627)
Warranty liability, end of period	$	3,314	$	3,057

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Pay vs Performance Disclosure
Net Income (Loss)	$ 15,140	$ 16,276

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

OTHER ASSETS (Tables)

3 Months Ended

Mar. 31, 2024

OTHER ASSETS.

Schedule of Other assets


	As of March 31,		As of December 31,
	2024		2023
Prepaid rent	$	349	$	349
Other		7		7
Repossessed homes		2,940		2,215
Total	$	3,296	$	2,571

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 31, 2024

FAIR VALUE MEASUREMENTS

Schedule of fair market value and book value of the portfolios


	As of March 31,		As of December 31,
	2024		2023
Consumer loan portfolio, fair value	$	157,590	$	155,146
Consumer loan portfolio, book value		159,185		156,499
Fixed rate MHP Notes, fair value		150,269		176,270
Fixed rate MHP Notes, book value		156,278		178,724
Fixed rate other notes, fair value		22,313		34,340
Fixed rate other notes, book value		22,816		34,590

CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	Mar. 31, 2024	Mar. 31, 2023
Operating activities:
Net income	$ 15,140	$ 16,276
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization expense	423	430
Amortization of deferred revenue	(729)	(290)
Provision for accounts and notes receivable	(171)	(43)
Provision for long term inventory	89	19
Gain from sale of leased property	(57)	(507)
Non-cash operating lease expense	(12)	14
Share based payment expense	257	192
Other non cash items	17	(21)
Changes in operating assets and liabilities:
Accounts receivable	237	915
Consumer loans activity, net	(2,428)	(2,287)
Notes receivable MHP activity, net	(1,245)	(11,667)
Dealer inventory loan activity, net	(1,228)	(2,189)
Inventories	(2,097)	(726)
Prepaid expenses and other current assets	(754)	305
Other assets - leased mobile homes	2,427
Other assets	(694)	(538)
Accounts payable and accrued liabilities	772	109
Right of use activity, net	7	(14)
Customer deposits	(37)	(2,369)
Escrow liability	849	(380)
Dealer incentive liability	40	80
Net cash provided by (used in) operating activities	10,806	(2,691)
Investing activities:
Purchases of property, plant and equipment	(871)	(761)
Proceeds from sale of leased property		1,108
Proceeds from sale of property	22
Issuance of notes receivable	(590)	(3,107)
Notes receivable collections	4,107	468
Collections from purchased loans	53	106
Net cash provided by (used in) investing activities	2,721	(2,186)
Financing activities:
Proceeds from exercise of stock options	100
Purchases of treasury stock	(1,871)
Proceeds from lines of credit	12,736	20,188
Payments on lines of credit	(24,619)	(14,896)
Net cash (used in) provided by financing activities	(13,654)	5,292
Net (decrease) increase in cash	(127)	415
Cash at beginning of period	748	2,818
Cash at end of period	621	3,233
Supplemental disclosure of cash flow information:
Cash paid for interest	$ 411	59
Cash paid for taxes		$ 3,827

OTHER NOTES RECEIVABLE (Tables) - Other note receivable

3 Months Ended

Mar. 31, 2024

Accounts, Notes, Loans and Financing Receivable [Line Items]

Schedule of other notes receivable


	As of March 31,		As of December 31,
	2024		2023
Outstanding principal balance	$	30,694	$	35,353
Loan discount and deferred financing fees		(323)		(527)
Allowance for loan losses		(176)		(236)
Total	$	30,195	$	34,590

Schedule of allowance for loan losses


	Three months ended March 31,		Three months ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	236	$	—
Provision for loan losses		(60)		433
Charge offs (recoveries)		—		—
Allowance for loan losses, end of period	$	176	$	433

Schedule of impaired and general reserve for allowance for loan losses


	As of March 31,		As of December 31,
	2024		2023
Total Other notes receivable	$	30,694	$	35,353
Allowance for loan losses		176		236
Impaired loans individually evaluated for impairment		24,609		25,135
Specific reserve against impaired loans		76		84
Other notes receivable collectively evaluated for allowance		6,085		10,218
General allowance for loan losses		100		152

Schedule of disaggregation of outstanding principal balance of consumer loans receivable


	Year of Origination
	2024		2023		2022		2021		2020		Prior		Total		% of Portfolio
< 30 days past due	$	—	$	17,493	$	466	$	—	$	300	$	101	$	18,360	%	59.8
30-90 days past due		—		11,274		229		183		—		—		11,686		38.1
> 90 days past due		—		—		—		648		—		—		648		2.1
Total	$	—	$	28,767	$	695	$	831	$	300	$	101	$	30,694	%	100.0

ACCRUED LIABILITIES

3 Months Ended

Mar. 31, 2024

ACCRUED LIABILITIES.

ACCRUED LIABILITIES

11. ACCRUED LIABILITIES

Accrued liabilities consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Warranty reserve	$	3,314	$	2,910
Litigation reserve		610		990
Payroll		845		879
Portfolio taxes and title		2,359		2,234
Property tax		364		1,018
Dealer rebates		879		1,040
Sales tax		251		190
Federal and state income taxes		7,137		3,759
Other		4,002		5,484
Total accrued liabilities	$	19,761	$	18,504

OTHER NOTES RECEIVABLE - Allowance for loan losses (Details) - Other Note Receivable - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Financing Receivable, Allowance for Credit Loss
Allowance for loan losses, beginning of period	$ 236
Provision for loan losses	(60)	$ 433
Allowance for loan losses, end of period	$ 176	$ 433

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

OTHER NOTES RECEIVABLE - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accrued interest rate	17.50%
Default loans included in notes receivable from MHP	$ 26,000
Default loans included in other notes receivable	10,000
Property and homes, foreclosed amount included in property, plant and equipment	2,300
MHP and Other Notes Receivable \| Credit concentration risk \| Independent Third Party One \| Independent third party and affiliates one
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding principal balance	54,000
Receivables currently in default and are the subject of ongoing litigation	36,000
Other note receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Charge offs	0	$ 0
Specific reserve against impaired loans	76		$ 84
Impaired loans individually evaluated for impairment	24,609		25,135
Outstanding principal balance	30,694		35,353
Loan discount and deferred financing fees	(323)		(527)
Allowance for loan losses	(176)	$ (433)	(236)
Total	30,195		34,590
Other note receivable \| Financial Asset, Past Due [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding principal balance	$ 286		$ 22
Other note receivable \| Minimum
Accounts, Notes, Loans and Financing Receivable [Line Items]
Interest rate on the other notes	5.00%
Other note receivable \| Maximum
Accounts, Notes, Loans and Financing Receivable [Line Items]
Interest rate on the other notes	17.90%

SHARE-BASED COMPENSATION - Summary of Stock options activity (Details) - Employee Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Number of units
Outstanding at the beginning	1,006,000	1,025,000
Granted		43,000
Exercised	(6,000)	(6,000)
Forfeited		(56,000)
Outstanding at the end	1,000,000	1,006,000	1,025,000
Exercisable	90,000	96,000
Weighted Average Exercise Price Per Unit
Outstanding at the beginning (in dollars per share)	$ 41.35	$ 40.59
Granted (in dollars per share)		22.94
Exercised (in dollars per share)	16.01	16.01
Forfeited (in dollars per share)		16.01
Outstanding at the end (in dollars per share)	41.51	41.35	$ 40.59
Exercisable (in dollars per share)	44.00	42.18
Weighted Average Grant Date Fair Value Per Unit
Outstanding at the beginning (in dollars per share)	5.22	4.99
Granted (in dollars per share)		15.32
Exercised (in dollars per share)	8.57	8.57
Forfeited (in dollars per share)		8.57
Outstanding at the end (in dollars per share)	5.20	5.22	$ 4.99
Exercisable (in dollars per share)	$ 4.49	$ 4.76
Weighted Average Remaining Contractual Life and Aggregate Intrinsic Value
Outstanding (in years)	8 years 10 days	8 years 3 months 10 days	9 years 5 months 8 days
Granted (in years)		4 years 8 months 12 days
Exercisable (in years)	8 years 5 months 8 days	8 years 5 months 8 days
Non-vested shares	910,000
Unrecognized compensation expense	$ 4,332
Unrecognized compensation expense, recognition period	8 years
Share based compensation expense	$ 147	$ 126

SHARE-BASED COMPENSATION - Plan (Details) shares in Millions	3 Months Ended
	Mar. 31, 2024 shares
SHARE-BASED COMPENSATION
Number of shares may be issued to employees, directors, consultants and nonemployee service providers in the form of stock options, stock and stock appreciation rights	10.0
Number of shares available for grant	8.7
Employee Stock Option [Member]
SHARE-BASED COMPENSATION
Contractual life	10 years

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 718
-SubTopic 10
-Name Accounting Standards Codification
-Section 35
-Paragraph 1D
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480483/718-10-35-1D

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-URI https://asc.fasb.org//1943274/2147480429/718-10-50-2

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-URI https://asc.fasb.org//1943274/2147480429/718-10-50-2

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-URI https://asc.fasb.org//1943274/2147480429/718-10-50-2

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-Topic 718
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-URI https://asc.fasb.org//1943274/2147480429/718-10-50-2

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-Topic 718
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org//1943274/2147480429/718-10-50-2

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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480429/718-10-50-2

+ Details

NATURE OF OPERATIONS - Leased Property (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2024 USD ($) home	Mar. 31, 2023 USD ($)
Lessor, Description Of Leases [Line Items]
Useful life	15 years
Depreciation expense on leased property	$ 124	$ 160
Number of leased mobile homes sold \| home	120
Proceeds from sale of leased mobile homes	$ 5,500
Minimum
Lessor, Description Of Leases [Line Items]
Term of lease agreement	96 months
Maximum
Lessor, Description Of Leases [Line Items]
Term of lease agreement	120 months

NOTES RECEIVABLE FROM MOBILE HOME PARKS

3 Months Ended

Mar. 31, 2024

NOTES RECEIVABLE FROM MOBILE HOME PARKS

NOTES RECEIVABLE FROM MOBILE HOME PARKS

4. NOTES RECEIVABLE FROM MOBILE HOME PARKS

The notes receivable from mobile home parks (“MHP Notes”) relate to mobile homes sold to mobile home parks and financed through notes receivable. The MHP Notes have varying maturity dates and require monthly principal and interest payments. The interest rate on the MHP Notes can be fixed or variable, and the interest rates range from 6.9% to 12.5%, excluding the Default Loans defined below. The average interest rate per loan, excluding the Default Loans below, was approximately 8.0% as of March 31, 2024 and December 31, 2023, with maturities that range from 1 to 10 years. The collateral underlying the MHP Notes are individual mobile homes which can be repossessed and resold. The MHP Notes are generally personally guaranteed by borrowers with substantial financial resources.

As of March 31, 2024, the Company had concentrations of MHP Notes with three independent third-parties and their respective affiliates that equated to 24.0%, 17.2% and 13.4% of the principal balance outstanding, all of which was secured by the mobile homes. As of December 31, 2023, the Company had concentrations of MHP Notes with three independent third-parties and their respective affiliates that equated to 24.5%, 17.9% and 14.0% of the principal balance outstanding, all of which was secured by the mobile homes.

MHP Notes are stated at amounts due from customers, net of allowance for loan losses. The Company determines the allowance by considering several factors, including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance composed of specific and general reserve amounts. As of March 31, 2024 and December 31, 2023, the MHP Notes balance is presented net of unamortized finance fees of $1,257 and $1,565, respectively. The finance fees are amortized over the life of the MHP Notes.

As of March 31, 2024 and December 31, 2023 there were past due balances of $262 and $98, respectively, on the MHP Notes excluding the Default Loans, as defined below. For the three months ended March 31, 2024 and 2023, there were no charge offs recorded for MHP Notes. Allowance for loan loss for the MHP Notes was $616 and $735 as of March 31, 2024 and December 31, 2023, respectively. As of March 31, 2024 and December 31, 2023, there was a minimal impaired balance of MHP Notes. Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell.

Approximately $54 million of MHP Notes and Other notes receivable is with borrowers either owned or operated by one individual. Approximately $36 million of these notes currently is in default (the “Default Loans”) and is the subject of ongoing litigation in which the Company is the plaintiff. These notes are collateralized by mobile homes and land and are personally guaranteed by multiple borrowers. The Company evaluated the recoverability of these notes as of March 31, 2024 and determined a provision for expected loan losses is not deemed necessary based on the analysis of the underlying collateral. The Company accelerated the Default Loans at the end of January, 2024. Upon acceleration, the loans accrue interest at a rate of 17.5% and are due on demand. At March 31, 2024 the Default Loans are presented on the accompanying balance sheets under the heading Current assets, with $26 million in Current portion of notes receivable from mobile home parks (“MHP”) and $10 million in Current portion of other notes receivable. During the three months ended March 31, 2024, the Company foreclosed on property and homes of $2.3 million that is included on the accompanying balance sheets in Property, plant and equipment, net.

Notes receivable from mobile home parks, net of allowance for loan losses and deferred financing fees, consisted of the following at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Outstanding principal balance	$	184,435	$	184,280
Loan discount and deferred financing fees		(1,257)		(1,565)
Allowance for loan losses		(616)		(735)
Total	$	182,562	$	181,980

The following table presents a detail of the activity in the allowance for loan losses for the three months ended March 31, 2024 and 2023:


	Three months ended March 31,		Three months ended March 31,
	2024		2023
Allowance for loan losses, beginning of period	$	735	$	—
Provision for loan losses		(119)		205
Charge offs (recoveries)		—		—
Allowance for loan losses, end of period	$	616	$	205

The following table presents impaired and general reserve for allowance for loan losses at March 31, 2024 and December 31, 2023:


	As of March 31,		As of December 31,
	2024		2023
Total MHP loans	$	184,435	$	184,280
Allowance for loan losses		616		735
Impaired loans individually evaluated for impairment		29,884		31,215
Specific reserve against impaired loans		5		5
Other loans collectively evaluated for allowance		154,552		153,065
General allowance for loan losses		611		730

We evaluate the credit quality of our MHP portfolio based on the aging status of the loan and by payment activity. Loan delinquency reporting is generally based upon borrower payment activity relative to the contractual terms of the loan. The following table disaggregates the outstanding principal balance of MHP receivable by credit quality indicator based on delinquency status and fiscal year of origination and is presented as of March 31, 2024:


	Year of Origination
	2024		2023		2022		2021		2020		Prior		Total		% of Portfolio
< 30 days past due	$	6,247	$	44,028	$	46,610	$	25,829	$	31,134	$	3,855	$	157,703	%	85.5
30-90 days past due		—		11,950		4,340		8,328		1,948		—		26,566		14.4
> 90 days past due		—		120		46		—		—		—		166		0.1
Total	$	6,247	$	56,098	$	50,996	$	34,157	$	33,082	$	3,855	$	184,435	%	100

SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2024

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

19. SUBSEQUENT EVENTS

In connection with the preparation of these financial statements, we evaluated subsequent events after the balance sheet date of March 31, 2024 and through the date of this filing and determined that no events occurred that would require adjustments or disclosures in the financial statements except those listed below.

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2024	May 06, 2024
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2024
Document Transition Report	false
Entity Registrant Name	Legacy Housing Corporation
Entity File Number	001-38761
Entity Incorporation, State or Country Code	TX
Entity Tax Identification Number	20-2897516
Entity Address, Address Line One	1600 Airport Freeway
Entity Address, Address Line Two	#100
Entity Address, City or Town	Bedford
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	76022
City Area Code	817
Local Phone Number	799-4900
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock ($0.001 par value)
Trading Symbol	LEGH
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		24,316,488
Entity Central Index Key	0001436208
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONSUMER LOANS RECEIVABLE- Narrative (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2024 USD ($) item	Dec. 31, 2023 USD ($)
Accounts, Notes, Loans and Financing Receivable [Line Items]
Escrow liability	$ 10,953	$ 10,104
Repossessed assets	$ 2,940	$ 2,215
Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Average contractual interest rate	13.20%	13.20%
Escrow liability	$ 10,953	$ 10,104
Number of components comprising the allowance for loan losses \| item	2
Number of years historical loss rate considers for calculation	3 years
Repossessed assets	$ 2,940	2,215
Principal outstanding on consumer loans	$ 2,041	$ 1,565
Minimum \| Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer loans receivable term	2 years
Maximum \| Consumer
Accounts, Notes, Loans and Financing Receivable [Line Items]
Consumer loans receivable term	30 years

EARNINGS PER SHARE- Tabular (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Numerator:
Net income (in 000's)	$ 15,140	$ 16,276
Denominator:
Basic weighted-average common shares outstanding	24,393,003	24,374,677
Effect of dilutive securities:
Diluted weighted-average common shares outstanding	25,125,016	25,177,502
Earnings per share attributable to Legacy Housing Corporation
Basic (in dollars per share)	$ 0.62	$ 0.67
Diluted (in dollars per share)	$ 0.60	$ 0.65
Restricted stock grants
Effect of dilutive securities:
Dilutive securities	6,135	13,383
Employee Stock Option [Member]
Effect of dilutive securities:
Dilutive securities	725,878	789,442

LINES OF CREDIT (Details) - Revolver - USD ($) $ in Thousands		3 Months Ended
	Jul. 28, 2023	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Lines of Credit
Maximum borrowing capacity	$ 50,000
Effective interest rate (in percent)		7.67%		7.95%
Amount of available credit		$ 38,203		$ 26,320
Interest expense		2	$ 91
Outstanding balance		$ 11,797		$ 23,680
Deferred debt issuance costs	$ 271
Term of facility	4 years
Additional commitment accordion feature	$ 25,000
Interest rate based upon average quarterly borrowings	2.75%
financial covenants:
Maximum leverage ratio		1.00%
Minimum fixed charge coverage ratio		1.75
SOFR
Lines of Credit
Spread rate	2.50%
Base rate
Lines of Credit
Spread rate	2.50%

COMMITMENTS AND CONTINGENCIES - Legal Matters (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
COMMITMENTS AND CONTINGENCIES
Legal reserves	$ 610	$ 990

CONSUMER LOANS RECEIVABLE - Consumer loans receivable, net (Details) - Consumer - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Receivables
Consumer loans receivable	$ 162,196	$ 159,738
Loan discount and deferred financing fees	(2,447)	(2,473)
Allowance for loan losses	(564)	(765)	$ (816)	$ (830)
Total	$ 159,185	$ 156,500

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

FAIR VALUE MEASUREMENTS - Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Fair Value \| Level 3 \| Consumer Loan
Receivables, Fair Value Disclosure [Abstract]
Loans	$ 157,590	$ 155,146
Fair Value \| Level 3 \| Notes Receivable from Mobile Home Parks
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	150,269	176,270
Fair Value \| Level 3 \| Other Note Receivable
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	22,313	34,340
Book Value \| Consumer Loan
Receivables, Fair Value Disclosure [Abstract]
Loans	159,185	156,499
Book Value \| Notes Receivable from Mobile Home Parks
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	156,278	178,724
Book Value \| Other Note Receivable
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	$ 22,816	$ 34,590

CONSUMER LOANS RECEIVABLE - Aging of consumer loans receivable (Details) - Consumer - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Past due consumer loans:
Total consumer loans receivable (as a percent)	100.00%	100.00%
Consumer loans receivable	$ 162,196	$ 159,738
Financial Asset, Past Due
Past due consumer loans:
Consumer loans receivable	$ 4,359	$ 2,345
Consumer loans receivable past due (Percent)	2.70%	1.50%
31 - 60 days past due
Past due consumer loans:
Consumer loans receivable	$ 1,696	$ 624
Consumer loans receivable past due (Percent)	1.00%	0.40%
61 - 90 days past due
Past due consumer loans:
Consumer loans receivable	$ 357	$ 149
Consumer loans receivable past due (Percent)	0.20%	0.10%
91 - 120 days past due
Past due consumer loans:
Consumer loans receivable	$ 414	$ 123
Consumer loans receivable past due (Percent)	0.30%	0.10%
Greater than 120 days past due
Past due consumer loans:
Consumer loans receivable	$ 1,892	$ 1,449
Consumer loans receivable past due (Percent)	1.20%	0.90%

REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Disaggregation of Revenue
Product sales	$ 30,833	$ 43,318
Consumer and MHP loans interest:
Interest - consumer installments notes	5,100	4,657
Interest - MHP notes	4,608	3,048
Interest - dealer finance notes	925
Total consumer, MHP and dealer loans interest	10,633	7,705
Other	1,777	1,834
Total net revenue	43,243	52,857
Direct sales
Disaggregation of Revenue
Product sales	1,795	7,426
Commercial sales
Disaggregation of Revenue
Product sales	13,602	15,565
Inventory finance sales
Disaggregation of Revenue
Product sales	8,463	13,615
Retail store sales
Disaggregation of Revenue
Product sales	4,796	3,967
Other product sales (1)
Disaggregation of Revenue
Product sales	$ 2,177	$ 2,745

OTHER ASSETS (Details) - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
OTHER ASSETS.
Prepaid rent	$ 349	$ 349
Other	7	7
Repossessed homes	2,940	2,215
Total	$ 3,296	$ 2,571

NATURE OF OPERATIONS - Product Warranty (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
NATURE OF OPERATIONS
Term of product warranty	1 year
Warranty liability, beginning of period	$ 2,910	$ 3,048
Product warranty accrued	941	636
Warranty costs incurred	(537)	(627)
Warranty liability, end of period	$ 3,314	$ 3,057

PROPERTY, PLANT AND EQUIPMENT (Tables)

3 Months Ended

Mar. 31, 2024

PROPERTY, PLANT AND EQUIPMENT

Schedule of property, plant and equipment


	As of March 31,		As of December 31,
	2024		2023
Land	$	17,287	$	14,953
Buildings and leasehold improvements		13,578		13,419
Construction in Progress		12,010		11,576
Vehicles		1,571		1,571
Machinery and equipment		6,772		6,527
Furniture and fixtures		336		329
Total		51,554		48,375
Less accumulated depreciation		(10,794)		(10,495)
Total property, plant and equipment	$	40,760	$	37,880

CONSUMER LOANS RECEIVABLE - Allowance for loan losses (Details) - Consumer - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Financing Receivable, Allowance for Credit Loss
Allowance for loan losses, beginning of period	$ 765	$ 830
Provision for loan losses	(268)	(70)
Charge offs	67	56
Allowance for loan losses, end of period	$ 564	$ 816

- Definition

Amount of allowance for credit loss on financing receivable. Excludes allowance for financing receivable covered under loss sharing agreement.

+ References + Details

CONDENSED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2024	Dec. 31, 2023
Current assets:
Cash	$ 621	$ 748
Accounts receivable, net	4,314	4,656
Current portion of contracts - dealer financed	34,041	32,538
Current portion of consumer loans receivable	7,903	7,682
Current portion of notes receivable from mobile home parks ("MHP")	45,178	18,156
Current portion of other notes receivable	14,669	6,013
Inventories	34,250	33,176
Prepaid expenses and other current assets	5,310	4,915
Total current assets	146,286	107,884
Consumer loans receivable, net	151,282	148,818
Notes receivable from mobile home parks ("MHP"), net	137,384	163,824
Other notes receivable, net	15,526	28,577
Inventories, net	8,727	7,793
Other assets - leased mobile homes	5,049	7,601
ROU assets - operating leases	1,661	1,794
Other assets	3,296	2,571
Property, plant and equipment, net	40,760	37,880
Total assets	509,971	506,742
Current liabilities:
Accounts payable	3,604	4,090
Accrued liabilities	19,761	18,504
Customer deposits	4,109	4,146
Escrow liability	10,953	10,104
Operating lease obligation	474	489
Total current liabilities	38,901	37,333
Longterm liabilities:
Operating lease obligation, less current portion	1,274	1,396
Lines of credit	11,797	23,680
Deferred income taxes, net	2,338	2,338
Dealer incentive liability	5,300	5,260
Total liabilities	59,610	70,007
Commitments and contingencies (Note 15)
Stockholders' equity:
Preferred stock, $.001 par value, 10,000,000 shares authorized: no shares issued or outstanding
Common stock, $.001 par value, 90,000,000 shares authorized; 24,852,740 and 24,843,494 issued and 24,316,488 and 24,398,429 outstanding at March 31, 2024 and December 31, 2023, respectively	31	30
Treasury stock at cost, 536,252 and 445,065 shares at March 31, 2024 and December 31, 2023, respectively	(6,348)	(4,477)
Additional paid-in-capital	181,780	181,424
Retained earnings	274,898	259,758
Total stockholders' equity	450,361	436,735
Total liabilities and stockholders' equity	$ 509,971	$ 506,742