2. Forward-looking Statements
Some of the statements in this presentation are “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by the fact that
they relate only to anticipated or expected events, activities, trends or results, which are inherently subject to
risks, uncertainties and other factors. Actual results and outcomes may differ materially from what is
expressed or forecast in such statements. Important factors include, but are not limited to: (1) the effects of
the current downturn in the homebuilding industry, including potential adverse market conditions that could
result in additional inventory or other impairments; (2) changes in national or regional economic or business
conditions, including employment levels and interest rates; (3) competition; (4) customer cancellations; (5)
price changes in raw materials or other components of our houses; (6) the effects of disruptions in the
mortgage financing industry, including the tightening of credit and reduction in liquidity; (7) the availability of
adequate sources of financing; and (8) our ability to generate cash from sales of assets and other sources
that supplement our existing capital resources. These risks and uncertainties are described in greater detail
in our periodic and other reports filed with the Securities and Exchange Commission, including our Annual
Report on Form 10-K for the fiscal year ended March 31, 2008 and our Quarterly Report on Form 10-Q for
the quarter ended June 30, 2008. All forward-looking statements involving financial or operating
projections or estimates contained herein were initially provided on July 30, 2008 and have not been
updated for this presentation. The risk that actual results will differ materially from expectations expressed
in this presentation will increase with the passage of time. We do not undertake any obligation to update or
revise any forward-looking statement.
2
3. Table of contents
Current state of the industry
Immediate actions and directions
Building a better Centex
3
4. Signs of a typical housing market bottom
Foreclosures rise
Economy slows, recession is likely
Housing starts fall precipitously
New home market corrects much faster than existing
Land prices begin to soften more widely
Homebuilders with liquidity begin to reinvest
Source: Experience in previous cycles
4
10. 0
50
100
150
200
250
300
350
Ju
n-
Se 03
p-
0
D3
ec
-0
M3
ar
-0
Ju 4
n-
Se 04
p-
0
D4
ec
-0
M4
ar
-0
Lots Owned
Ju 5
n-
S 05
ep
-0
D5
ec
Reducing land position
-0
M5
ar
-0
Ju 6
n-
S 06
ep
-0
D6
ec
-0
M6
ar
-0
Total Lots Owned and Controlled
Ju 7
n-
S 07
Lots Controlled
ep
-0
D7
ec
-0
M7
ar
-0
Ju 8
n-
08
10
11. Ju
0K
2K
4K
6K
8K
10K
12K
14K
16K
n
Se -03
p-
D 03
ec
-
M 03
ar
-0
Ju 4
n
Se -04
p-
D 04
ec
-0
Selling homes
M4
ar
-0
Ju 5
Cancellation Ratio
n
Se -05
p-
D 05
ec
-
M 05
ar
-0
Ju 6
n
Se -06
p-
D 06
ec
-0
M6
Gross Sales
ar
-0
Sales and Cancellation rates
Ju 7
n
Se -07
p-
D 07
ec
-0
M7
ar
-0
Ju 8
n-
08
Net Sales
0%
10%
20%
30%
40%
11
12. 0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Ju
n -0
2,506
Se 3
p -0
3,206
De 3
c -0
4,170
Ma 3
r -0
2,862
Ju 4
n -0
2,907
Se 4
p -0
3,655
De 4
c -0
4,803
Ma 4
Started Not Sold Units
r -0
3,376
Ju 5
n -0
3,062
Se 5
Minimizing inventory
p -0
4,174
De 5
c -0
6,191
Ma 5
r -0
5,823
Ju 6
n -0
5,798
Se 6
p -0
Started Not Sold $ as % of Housing Inventory $
6,575
De 6
c -0
6,386
Ma 6
r -0
4,909
Ju 7
n -0
4,815
Se 7
p -0
4,708
De 7
c -0
4,259
Ma 7
r -0
1,754
Ju 8
n -0
8 1,356
0%
5%
10%
15%
20%
25%
30%
12
13. Conserve and accumulate cash
Cash balance of $1.24 billion at June 30
• Expecting balance to be higher on 3/31/09
Continue to proactively lower debt
• Bought back $67 mil of senior notes in 1Q
• Paid off $150 mil of senior notes in 2Q at maturity
• Expect to reduce joint venture debt by approximately $70 mil in 2Q
Significantly increased bank revolver availability
Dramatically reducing land development budget
• Land acquisition/development now expected to be less than $400
mil for remainder of this fiscal year
Cash conservation and accumulation is a top company priority
• Expect to remain capital self-sufficient
13
14. Focused on restoring profitability
Observing higher margins on “to-be-built” homes
• 410 bps sequential improvement in housing gross margin
• Incentives and discounts should continue to diminish
Seeing brick and mortar reductions despite higher
commodity and energy costs
Lowering interest expense
Continuing to adjust overhead spending
14
15. Centex Energy Advantage program
Standard for all new Centex homes starting January
2009
• Up to 22% more efficient than comparable new homes
• Up to 40% more efficient than a typical 10-year old home
Helps our homebuyers address affordability
17,800 fewer metric tons of carbon yielded annually for
each 10,000 homes
• Equivalent of the greenhouse gas emissions from 2,957
cars for 1 year
A positive for customers, shareholders, employees and
the environment
15
17. Centex Business Processes
We are defining and standardizing all of our core business processes, and plan
to complete this effort by the end of fiscal 2009.
Enterprise Management Processes
Strategic Directions Human Capital Allocation
Strategic Plans Information Systems Development and Deployment
Operating Plans Policies
Capital Allocation Enterprise Risk Management
Governance Process Improvement
Core Business Processes
Home and
Strategic Land
Community Procure Sell Build
Marketing Management
Design
Support Processes and Services
Human Capital Management Mortgage, Title and Insurance
Accounting and Financial Services Facilities Management
Information Systems Services Communications
Legal Services Operational Marketing
17
18. Achieving Competitive Excellence
Sell to backlog Build to cadence
Emphasizing lower cost channels to Predictability/reliability of scheduling
generate leads trade partners, tasks, etc.
Maximizing the opportunity to convert Sequencing “homes to be built” in a
every precious lead geographically optimal order
Making good price/volume tradeoff Doing it right the first time
decisions, in a dirt sales environment
Achieving cost efficiency in
distribution and installation
Emphasis on maximizing
profitability and ROA
18
19. Cadence model is advanced evenflow
Centex ACE scheduling
Previous scheduling
Starts per day Starts per day
10
10
8
8
6
6
4
4
2
2
0
0
0 5 10 15 20
0 5 10 15 20
Day Day
Unpredictable scheduling meant all ACE scheduling operates at a
• •
Trade Partners were staffed for the consistent cadence each day
peaks Savings arise from:
•
- They had to be to handle the - Higher crew utilization
increases in workload
- Quality improvements from
No Trade Partners could have 100% dedicated crews
•
crew utilization
Requires:
•
- If they did, they wouldn’t be in
- True Trade Partnerships
business
- Reliable scheduling
- Quality up and down the supply
chain
19
20. Cadence model drives improved profitability
Sell to a backlog Build to a cadence
B&M spend
Gross margin
100%
100%
XXX
15% 94%
14%
85% X%
~15%
B&M
75 savings
10 9%
50
5
25
0
0 Red Yellow Green
No Current Fully
Pre sales Specs
(pilot)
(current (PHX pilot)
Cadence Implemented
projection)
Cadence trumps volume for profitability (450 closings on cadence more profitable than
600 closings off cadence)
Note: Gross margin data represents CTX average for April- May closings (CFA Actuals)
20
21. Capital allocation is key
Concentrate investment in markets with greatest long-
term profit potential that reward high relative market
share
Consolidate divisions where resources can be shared
Exit those markets without strong long-term economic
fundamentals or where scale is not meaningful
The resulting re-investment strategy will produce
improved margins and returns
21
22. Rationale for strategic reinvestment
Relationship between relative local market share
and performance among Centex divisions
Operating Margin ROANA
20% 40%
30%
20%
10%
10%
0%
0%
0.4 0.6 0.8 1 1.2
0.4 0.6 0.8 1 1.2
Relative Local Market Share Relative Local Market Share
Regression analysis based on CY02-04 Centex averages
22
23. Aggressively building a better Centex
Focused on asset efficiency and a more flexible land
position
Improving core Centex business processes
Increasing relative share strength in markets that will
provide best returns
Expect sustainable cost reductions and higher, more
consistent future returns
Continue to exceed customer expectations
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