You are given a text that consists of multiple sentences. Your task is to perform abstractive summarization on this text. Use your understanding of the content to express the main ideas and crucial details in a shorter, coherent, and natural sounding text. 
Text: I want to highlight that we will be discussing our reported fourth-quarter numbers as well as our results adjusted to exclude the impact of certain reserve adjustments and tax benefits recorded in the period.
We encourage you to review these tables to assist in your analysis of our business performance.
Actual results could differ materially from those suggested by our comments made today.
These risk factors and other key information are detailed in our SEC filings, including our annual and quarterly reports.
I appreciate everyone joining today's call.
I hope that your new year has started well and that you are -- and that you remain healthy and safe.
It goes without saying that Covid19 and the resulting challenges made 2020 a year unlike any that we've experienced before.
Let me just say right upfront that I'm extremely proud of how our entire team responded and how our organization remain engaged and focused during some very difficult times.
We also ended the quarter with $2.6 billion of cash and a net debt to capital ratio below 2%.
Reflecting a lot of hard work by an amazing team, PulteGroup realized a 6% increase in full-year closings to 24,624 homes and a corresponding 7% increase in full-year home sale revenues to $10.6 billion.
Benefiting from our ability to expand Homebuilding gross and operating margins along with dramatic gains in our financial services business, we converted the 7% topline growth into a 29% increase in pre-tax income of $1.7 billion.
Our outstanding results extend beyond our income statement as we generated $1.8 billion in operating cash flow in 2020 after investing $2.9 billion in land and development during the year.
Beyond investing in land, we increased our dividend by 17%, effective with the payment we made this month and repurchased a $171 million of our common shares in 2020, despite having suspended the program for six months because of the pandemic.
I am also extraordinarily proud to note that consistent with our focus on generating high returns over the housing cycle, we realized a 23.7% return on equity for the year.
With 2020 complete, we enter 2021 in a strong financial position and with numerous opportunities to drive further business gains.
Obviously, we can't control how the pandemic plays out but we are optimistic that the multiple vaccines getting distributed, mean that we can see a light at the end of this long tunnel.
Bob will provide specific guidance as part of his comments, but let me offer a view of how we are looking at the business and how we plan to operate in the year ahead.
We expect a strong demand environment, which the housing industry experienced for much of 2020 and in reality for many quarters prior to Covid can continue well into 2021.
We said for years that we thought housing starts needed to be around 1.5 million to meet the natural demand created by growth in population and household formations.
We finally reached 1.5 million starts in 2020, but we have under built relative to this number for years.
Given this unmet need and the potential mix shift in demand toward more single-family and away-from-apartment living, we believe demand can remain strong going forward for our business.
Beyond the demographic tailwind, we also believe that the pandemic has caused a permanent increase in the number of people who will be working from home full or at least part-time.
Such a shift has profound implications in terms of what people need from their homes as well as where their homes can be located.
For example, we believe a remote working dynamic expands the buyer pool because it can allow people to purchase more affordable homes in further out locations.
At the same time, working from home has the potential to increase the intent to buy new homes, which offer floor plans and technology features to better meet the needs of today's homebuyers.
With such a strong demand environment, it works to our advantage to be among the nation's largest builders with access to land, labor, and material resources.
We enter 2021 with more than 15,000 houses in backlog, 180,000 lots under control, of which half are controlled via option and long-standing relationships with suppliers and trade partners.
The combination of these factors should allow us to increase 2021 deliveries by more than 20% over the last year.
Labor remains tight, although the change in administration may allow for some relief assuming immigration policies are eased.
At the same time, product manufacturers are battling supply chain issues and the occasional Covid-related disruption within their plants.
Although, I must say, our suppliers have been tremendous partners, going above and beyond in many instances to provide the materials we need.
Given high expectations for the Company's operating performance and our balance sheet strength at year-end, I believe we are exceptionally well-positioned to execute on all of our capital allocation priorities, more specifically, we are targeting land acquisition and development spend of $3.7 billion in 2021.
This is an increase of roughly $800 million over our 2020 investment, but we think appropriate given the growth in our operations.
Beyond our expected land investment, we have made great progress in planning for and selecting the location of our next offsite manufacturing plant.
We still have a few details to work out with the owners of the sites under consideration, but we hope to finalize a plant agreement within the next couple of months and then begin installing the requisite production equipment later this year.
Our ICG operation in Jacksonville has exceeded our expectations, so we are excited to get this new plant up and running sometime during the first quarter of next year.
And finally, we will continue to return excess funds to shareholders through our share repurchase program.
In response to the uncertainties caused by the pandemic, we had suspended share repurchase activities during the second and third quarters of last year.
We have repurchased more than one-third of the Company's share since initiating the program and we expect to remain an active buyer of our shares going forward.
Housing demand was outstanding in the back half of 2020, with strength across all geographies and buyer segments.
And I'm certainly pleased to report that this strength has continued unabated through the first few weeks of January.
The housing industry has been extremely fortunate in being an economic engine, but we do not take this for granted nor would we forget how devastating Covid19 has been for thousands of businesses and millions of people.
It is certainly our hope that we are rapidly approaching the end of this pandemic.
everyone, and let me add my best wishes and express my hope that we can all navigate the coming year in health and safety.
Where appropriate, I'll reference the impact of these items during my review of the quarter.
For our fourth quarter, home sale revenues increased 5% over last year to $3.1 billion.
The increase in revenues for the period was driven primarily by a 4% increase in average sales price to $446,000 as closings were up 1% to 6,860 homes.
The increase in average sales price for the period reflects a strong pricing environment for all buyer groups.
We're pleased to report that on a year-over-year basis.
Our average sales price was higher for our first time move-up and active adult buyer groups.
The demographic mix of our closings grew [Phonetic] slightly in the quarter and reflects changes caused both by the pandemic and by our strategic investment to serve more first-time buyers.
Consistent with these dynamics, our fourth-quarter closings in 2020 consisted of 32% first-time, 46% move-up, and 22% active adult.
In the fourth quarter of 2019, closings were comprised of 31% first-time, 45% move up, and 24% active adult.
Our net new orders for the fourth quarter increased 24% over last year to 7,056 homes, while our average community count for the period was down 2% from last year to 846.
The decrease in community count reflects the slowing of our land activities earlier this year in response to the pandemic as well as the faster close out of communities due to the strong demand environment and related elevated absorption paces.
Demand was strong across the entire period and actually accelerated toward quarter-end as December orders were higher than November and essentially flat with October.
Given the strength of ongoing demand, our divisions are taking specific actions to manage sales pace and production so our backlog does not get over extended.
We are also being thoughtful about adjusting priced to help cover rising house costs, especially the cost of lumber, which moved significantly higher in the quarter.
Consistent with what we experienced during the third quarter, demand was strong across all of our brands, including the ongoing acceleration in demand among active adult buyers.
In the fourth quarter, first-time orders increased 27% to 2,084 homes, move-up orders increased 17% in 2,994 homes, while active adult orders increased 33% to 1,978 homes.
In fact, our Q4 active adult orders were less than 100 units below the all-time quarterly high we reported in the third quarter of this year.
After a pause in the first half of 2020, active adult buyers have clearly gotten off the fence.
Our fourth quarter cancellation rate was 12% which is down from 14% last year.
Based on the strength of our sales, our year-end backlog increased 44% over last year to 15,158 homes.
Backlog value at year-end was $6.8 billion compared with $4.5 billion last year.
We believe our large backlog and continued strong demand for new homes has the company extremely well-positioned to realize significant year-over-year growth in closings in 2021.
At the end of the fourth quarter, we had a total of 12,370 homes under construction, of which 1,949 or 16% were spec.
In the fourth quarter, we focused on closing sold inventory, but we are actively working to increase production of sold and spec homes throughout our markets.
Our large backlog makes this process a little easier, and we're working closely with our trades and product suppliers to ensure the needed capacity to deliver more homes going forward.
With 12,000 -- 12,370 homes under construction at year-end, we expect deliveries in the first quarter of 2021 to be between 6,300 and 6,600 homes.
At the midpoint, this would be a 20% increase in closings over last year.
This growth rate is in line with what we expect for the full year as we are targeting deliveries to increase approximately 22% to 30,000 homes for all of 2021.
Given the strength of our move up and active adult sales along with price increases realized across all buyer groups, our average sales price and backlog was up 4% over last year to $448,000.
Based on the prices in backlog, we expect our average sales price on closings to be in the range of $430,000 to $435,000 both for the first quarter and for the full year 2021.
As we've said in the past, the final mix in deliveries can influence the average sales price we deliver in any given quarter.
Reflecting the benefits of the favorable pricing environment and our ongoing work to run a more efficient Homebuilding operation, our fourth quarter gross margin of 25% was up 220 basis points over last year and 50 basis points from the third quarter of this year.
Driven primarily by increases in lumber and labor, our house costs will be higher in 2021, however, given strong demand conditions, we expect to pass through most of these costs through increased sales prices.
As a result, we expect gross margins to remain high and be approximately 24.5% for both the first quarter and the full year.
Our reported SG&A expense for the fourth quarter was $280 million 9.1% of home sale revenues.
Excluding the $16 million net pre-tax benefit from adjustments to insurance-related reserves recorded in the fourth quarter, our adjusted SG&A expense was $296 million or 9.7% of home sale revenues.
Last year, our reported fourth quarter SG&A expense was $262 million or 8.9% of home sale revenues.
Excluding insurance reserve adjustment of $31 million last year, our adjusted SG&A expense was $293 million or 10% of home sale revenues.
At the outset of the pandemic, we took action to adjust our overheads in anticipation of a more difficult operating environment.
Although nearly all furloughed employees have rejoined the company and we've hired back many of the employees we released, we still expect to realize improved overhead leverage in 2021.
At present, we expect SG&A expense in the first quarter of 2021 to be in the range of 10.5% to 10.9%, which is down from 11.9% last year.
For the full year, we are targeting an SG&A expense of 10% of home sale revenues down from 10.2% on an adjusted basis last year.
Our financial services operations continued to deliver strong results as we reported fourth quarter pre-tax income of $43 million, which is up from $34 million last year.
It's worth noting that our fourth quarter 2020 results include the $22 million pre-tax charge from adjustments to our mortgage origination reserves as we settled claims tied to mortgages issued prior to the housing collapse.
The increase in pre-tax income in the quarter from our financial services business reflects continued favorable rate and competitive market conditions along with higher loan volumes resulting from an increase in mortgage capture rate.
Our mortgage capture rate for the quarter was 86%, up from 84% last year.
Our reported tax expense for the fourth quarter was $86 million, which represents an effective tax rate of 16.4%, and which reflects the tax benefit of $38 million resulting from energy tax credits and deferred tax valuation allowance adjustments recorded in the period.
In 2021, we expect our tax rate to be approximately 23.5%, including the benefit of energy tax credits we expect to realize this year.
Finishing up my review of the income statement, we reported net income for the fourth quarter of $438 million or $1.62 per share.
Our adjusted net income for the period was $404 million or $1.49 per share.
In the comparable prior-year period, the Company reported net income of $336 million or $1.22 per share and adjusted net income of $312 million or $1.14 per share.
Benefiting from the outstanding financial performance and resulting cash flows generated by our Homebuilding and Financial Services operations, we ended the quarter with $2.6 billion of cash.
In addition, at the end of the year, our gross debt to capital ratio was 29.5% which is down from 33.6% last year, and our net-debt-to-capital ratio was 1.8%.
In the fourth quarter, we repurchased 1.7 million common shares at a cost of $75 million or an average price of $43.69 per share.
For the full year, the company returned $171 million to shareholders through the repurchase of 4.5 million common shares at a cost of $37.58 per share.
First, we will exercise the early redemption feature effective February 1, on $426 million of senior notes originally scheduled to mature on March 1 of this year.
Assuming full execution of the tender, the retirement of the $726 million will save the company approximately $34 million in annual interest charges and on a pro forma basis, lower our gross debt-to-capital ratio to 23.7%.
In the fourth quarter, we invested $942 million in land acquisition and development, which brings our full-year 2020 spend to $2.9 billion.
As Ryan mentioned, given our positive view of the market and the expected strong cash flow generation of the business, we currently expect to increase our investment in land acquisition and development to $3.7 billion in 2021.
And finally, we ended the year with slightly more than 180,000 lots under control, of which 91,000 were owned and 89,000 were controlled through auctions.
I want to highlight that based on these numbers, we've effectively reached our stated goals of having 50% of our land pipeline controlled through options, and given our guidance targeting 30,000 closings in '21, we've also reached our goal of having three years of owned lots.
Land acquisition could be lumpy, so the numbers could move around, but we remain disciplined in our investment practices and focused on enhancing returns and reducing risks through the use of options.
When I took over as CEO in 2016, there were several areas where I saw an opportunity to enhance our long-term business performance.
Among the targets we put in place were: to expand first time to be one-third of our business, to lower our lot position to three years of owned lots, to control 50% of our land pipeline via options, and increase our growth rates while continuing to deliver high returns for our shareholders.
Given our 2020 performance and our expectations for 2021, it is gratifying to see that we've achieved these initial goals.
With this foundational work in place, we can now continue developing an even more successful business as we expand our operations, advance innovative customer-centric technologies, and integrate new construction processes.
Our outstanding 2020 results in combination with continued strength in housing demand also has PulteGroup entering '21 with tremendous momentum.
We begin the year with our largest backlog in well over a decade, along with great operating metrics and a strong balance sheet that gives us the flexibility to capitalize on market opportunities.
These opportunities include the expansion of our offsite manufacturing capabilities that I spoke about earlier, as well as the geographic expansion of our Homebuilding operations.
We have our initial land positions in place and we're working quickly to increase our lot pipeline in these new areas.
We are excited about the opportunities we see in both markets, as well as several other cities we are currently evaluating.
With our goal to increase closings by more than 20% this year, along with investing $3.7 billion in land and our expansion into new markets, we believe we are well-positioned to grow our operations while continuing to deliver high returns.
In closing, I'm extremely proud of what our organization accomplished in 2020.
We enter 2021 with high expectations, but I know the pandemic continues to rage and so we will continue to operate our business, thoughtfully and safely.
We ask that you limit yourself to one question and one follow-up.

user
q4 adjusted earnings per share $1.49.
q4 earnings per share $1.62.
pultegroup - ended q4 with unit backlog of 15,158 homes, which is up 44% over comparable prior year period, valued at $6.8 billion.
qtrly net new orders increased 24% to 7,056 homes; order value increased 33% to $3.3 billion.
qtrly home sale revenues increased 5% to $3.1 billion.

assistant