LETTER TO OUR SHAREHOLDERS Dear Shareholders, Simultaneously, we have continued to expand our LMC multifamily rental communities footprint and have This was an excellent year for Lennar. We continued to pioneered a new and exciting single family for rent focus on operational excellence, while we strategically (“SFR”) communities platform. These new professionally intensified our drive to pivot our land strategy to increase owned and operated SFR communities will create cash flow and shareholder returns. In 2019, we set op portunities to rent single family homes at affordable Company records by delivering 51,491 homes and prices with a full-service lifestyle package never seen re porting net earnings of $1.8 billion. We used excess be fore, for those who prefer a single-family lifestyle but cash flow to retire $1.1 billion of debt and repurchase do not want to own, or cannot quite afford to purchase, $493 million of stock, while reducing our debt to total a home. capital to 33%. Our results reflect both the ongoing strength in the housing market as well as our continued We are pleased with our 2019 results and we are invigorated focus on leveraging our size and scale to drive greater by the prospects for 2020 and beyond. shareholder value. Our 2019 operating results were as follows: Alongside operational improvements, we continued to focus considerable attention on the broader notion • Revenues of $22.3 billion – up 8% of sustainability. At Lennar, sustainability is about • Net earnings of $1.8 billion, or $5.74 per diluted con figuring our business to remain financially excellent, share, compared to $1.7 billion, or $5.44 per while employing new technologies to modernize our diluted share business practices, and adopting evermore social and environmental practices to fulfill the highest aspirations • Homebuilding operating earnings of $2.5 billion, of our constituents. With a foundation of solid governance compared to $2.3 billion principles that ensure integrity and accountability, we • Deliveries of 51,491 – up 13% have created an environmentally conscious homebuilding strategy that focuses on inclusion and diversity, and • New orders of 51,439 – up 12% en gages and supports the communities where we do • Backlog at year-end of 15,577 homes and backlog business. dollar value of $6.3 billion We can do well, do better and do good, • Gross margins on homes delivered increased to all at the same time. 20.6% from 19.6% As we look ahead, the macroeconomic environment • Selling, general and administrative expense as a in dicates continued strength, stimulated by low interest percentage of revenues from home sales improved rates and overall strong economic fundamentals. The to 8.3% from 8.5%, an all-time fiscal year low drivers behind the strength in the economy and housing • Operating margins on homes delivered increased market are trends that we believe will continue in 2020. to 12.3% from 11.1% Barring unexpected macroeconomic disruptions, a clear • Financial Services operating earnings, net of runway ahead affords us the welcome opportunity to non-controlling interests of $244.3 million, continue to work on and improve our balance between compared to $199.7 million land controlled versus owned while we continue to grow our core business. In 2019, we made significant • Multifamily operating earnings, net of progress in reducing our land holdings and pivoting non-controlling interests, of $18.1 million, towards a land lighter strategy. In 2020, we expect to compared to $42.7 million continue to reduce land inventory in order to improve • Lennar Other operating earnings, net of cash flow, retire long term debt, improve our balance non-controlling interests, of $32.0 million, sheet, return capital to shareholders and improve returns. compared to operating loss of $30.4 million Throughout 2019 and into 2020, the continued national • Homebuilding cash and cash equivalents of underproduction of housing, coupled with greater $1.2 billion af fordability derived from a strong jobs market, wage • Homebuilding debt to total capital of 32.8%, growth and consumer confidence, drove and will continue decreased from 36.9% largely due to the to drive homebuyers, especially at the entry level, to retirement of $1.1 billion in Homebuilding re turn to the housing market. As a result, we have senior notes continued to strategically adjust our product offering to capture an increased share of the entry level market. • Repurchased 9.8 million shares for $492.9 million Our homebuilding operations really hit their stride in As noted earlier, we expect that our strong operations and 2019. With significant size and scale in our local markets, profitability, coupled with our inventory management we have been able to maximize the benefits of our even strategies, will continue to generate a significant amount flow production model, which, combined with our of operating cash flow. In 2019, our homebuilding Everything’s Included ® platform, gives predictability to op erations generated $1.6 billion of cash flow, with our trade partners, suppliers and manufacturers, and which we paid off $1.1 billion of senior note maturities secures our position as the “Builder of Choice” with our and repurchased 9.8 million shares of our stock for trade base. As a result, we have been able to reduce $493 million. Our already solid balance sheet continued the impacts of the labor shortage, while maximizing to further strengthen, ending the year with debt-to-total supply chain efficiencies. Our focus on simplicity and capital of approximately 33%, which is a 410-basis technology, combined with our size and scale, are point improvement over the prior year. re flected in our SG&A percentage of home sale revenues of 8.3%, which was the lowest percentage in our Company’s While we have maintained laser focus on bottom line history. In addition to our focus on operational efficiencies, performance and operational excellence, Lennar has also we are partnering with industry disruptors to modernize had a long and successful history of focus on environmental, our business and provide enhanced experiences to our social and governance issues. We are one of the largest customers. We have just begun to scratch the surface homebuilders in the United States and we build homes of the process benefits we will gain from our internal to last, meeting the lifestyle preferences of our customers. and external technological investments. We include as standard in our new homes sustainable and energy efficient features, making them healthier Alongside our homebuilding operations, our Financial and easier to live in than prior generations of homes. Services segment performed exceptionally well in 2019. We are constantly focused on improving the future of This core operating segment has also significantly home ownership and rental, whether through our captive ben efitted from technology-based improvements, which solar program, the largest of any homebuilder, our led to decreased loan origination costs and improved strides to improve water and air quality, or our strategic customer experiences. In line with our constant focus on investments in companies that develop energy and resource simplification, our Financial Services segment streamlined saving products. We incorporate these innovative products the business in the beginning of fiscal 2019 by divesting in new homes, and help our partners bring them to market our less profitable third-party mortgage, title and insurance faster. By focusing broadly, we can create healthy homes operations. This focus on our core business drove significant and family experiences, alongside a strong bottom line, operational and financial improvement in the second half while appealing to both customers and investors who of the year. We are gaining evermore confidence that we expect and demand a broader social responsibility. We will continue to improve our entire end-to-end process to are truly driving the greatest shareholder value and get to a one-tap closing and create a customer satisfaction building a “Sustainable” Lennar. process that is simple and frictionless. Headed into 2020, we believe we are well positioned Over the next few years, we expect to see some of the to execute on our plan to deliver 54,000 – 55,000 same technology-based improvements affecting our core homes, generate significant cash flow and improve our homebuilding operations, specifically in areas of customer returns. We would like to thank our associates and our acquisition costs, even flow production and inventory trade partners for an excellent year. Through hard work management. and collaboration, we accomplished many great things in 2019, and are ready and excited for what we will In addition to our technology initiatives, we have had achieve together in 2020. an invigorated focus on inventory management as we continue our pivot to a land light configuration. From controlling the timing of land purchases, to reducing our Sincerely, years-owned supply of homesites, to increasing the per centage of land controlled through options or other agreements versus owned land, we are migrating towards a significantly smaller owned land inventory. At the be ginning of 2019, we set a two-year goal of increasing Stuart Miller Rick Beckwitt Jonathan Jaffe the homesites we control, but do not own, from 25% to Executive Chief Executive President 40% of our land needs. We made great progress on this Chairman Officer front and finished the year at 33%. Based on our progress, our new goal is to have 50% of our land needs controlled versus owned by the end of fiscal 2021. As part of this, we will strive to reduce our years of land owned from 4.1 years at the end of 2019 to 3 years by the end of fiscal 2021. FORM 10-K LENNAR CORPORATION FORM 10-K For the fiscal year ended November 30, 2019 Part I Item 1.