M.D.C. Holdings Reports 64% Increase in First Quarter Earnings
* Record first quarter net income of $60.9 million, up 64% * Earnings per share of $1.79 vs. $1.12 a year ago * Highest first quarter homebuilding revenues and operating profits in Company history * Record home orders, home closings and quarter-end backlog * Home gross margins of 26.2%, up 340 basis points * Net debt-to-capital ratio of .27

M.D.C. Holdings, Inc. today announced net income for the three months ended March 31, 2004 of $60.9 million, or $1.79 per share, the highest first quarter net income in the Company's history and 64% higher than net income of $37.0 million, or $1.12 per share, for the same period in 2003. Total revenues for the first quarter of 2004 were $764 million, compared with revenues of $570 million in the 2003 first quarter.

Larry A. Mizel, MDC's chairman and chief executive officer, stated, "We have experienced a tremendous start to what may be the best year in our Company's history. Through a balance of disciplined organic growth in our existing markets, opportunistic asset acquisitions and strategic start-ups in new markets, we positioned our Company in some of the country's fastest growing markets where we were able to capitalize on low mortgage rates and an improving economy. As a result, we established new first quarter highs for home closings, revenues, net income and earnings per share. These results contributed to our achievement of after-tax returns on revenues, assets and equity that rank among the best in our industry. In addition, we realized a quarterly record 4,429 net home orders, which enabled us to increase the sales value of our backlog to more than $2 billion for the first time. We continued to improve our investment grade financial position, lowering our March 31st ratio of debt-to-capital, net of cash, to .27 and increasing our cash and available borrowing capacity by more than 22% to $680 million, with no outstanding borrowings under our unsecured line of credit. Our financial flexibility was further enhanced late last week with the extension of the term of our unsecured line to five years and the increase in our borrowing capacity to $700 million, with the ability to further expand to $850 million with lender approval."

Mizel continued, "While our strong results give us confidence for the future, equity investors appear to be concerned about the potential impact of higher interest rates. As the economy picks up steam, MDC and the other large homebuilders are positioned to continue growing, aided by our solid financial positions, the constrained supply of land and the wide array of mortgage products available to our homebuyers. Indeed, we are encouraged by the apparent improvement in job growth that has elevated the recent interest rate concerns, because more jobs are critical to sustaining healthy homebuying demand. However, as always, we remain prepared for shifts in demand or changes in the economy. Our conservative land acquisition, operational and financial strategies should continue to serve us well across a broad range of business conditions."

Record Homebuilding Performance

Operating profits from the Company's homebuilding operations for the first quarter of 2004 increased by 76% to $113.4 million, compared with $64.5 million for the same period in 2003. The 2004 increase primarily resulted from a record 2,910 homes closed, up 39%, and a 340 basis point improvement in home gross margins to 26.2%. The increased home closings, partially offset by a $7,100 decrease in average selling prices, contributed to record first quarter home sales revenues of $746 million, 35% higher than revenues of $554 million in the 2003 first quarter.

Paris G. Reece III, MDC's executive vice president and chief financial officer, said, "Consistent with our targeted growth objectives over the last three years, we achieved significant year-over-year improvements in operating results in Nevada, Virginia, Arizona and California. Higher home closing volumes resulting from strong demand and increased active communities, significant selling price increases, and higher home gross margins in each of these markets except Virginia contributed to these improved results. Our performances in Arizona, Virginia and California were enhanced by the closing of a number of homes with much higher than average margins in subdivisions that are in the process of closing out. Nevada exhibited the greatest improvement in the quarter, reflecting an extraordinary demand for new homes that has created significant opportunities to increase prices in all of our price points in that market. The resulting increases in our Nevada home gross margins contributed significantly to the record average home gross margins realized by our Company in the 2004 first quarter."

Reece continued, "Our 2,910 first quarter home closings were higher than anticipated, primarily due to favorable weather conditions that enabled us to accelerate the closing of more than 200 homes into March that were otherwise scheduled to close in the 2004 second quarter, primarily in Nevada, Arizona and California. As a result of this acceleration, as well as an increase in our backlog of homes sold and not yet started at March 31st to almost 3,000 units, we anticipate that our home closings in the 2004 second quarter will be comparable to the exceptional level achieved in the first quarter. This projected record start to the year, which reflects our successful expansion in existing markets and meaningful contributions from four of our seven new markets, combined with the prospects of an improving economy, should position us to close more than 13,000 homes in 2004."

Financial Services Results

Driven by the record home closings from the homebuilding segment, the Company originated and brokered $341.3 million and $158.8 million, respectively, in mortgage loans in the quarter ended March 31, 2004, compared with $318.8 million and $45.9 million, respectively, in the same period in 2003. The resulting increase in mortgage loan origination fee revenues were more than offset by a reduction in gains on sales of mortgage loans and higher general and administrative expenses. As a result, the operating profits of the Company's financial services segment were $4.7 million for the first three months of 2004, compared with $7.6 million reported for the same period in 2003. The decline in gains on sales of mortgage loans in the 2004 first quarter primarily was due to a more competitive pricing environment for mortgage loans. This competitive environment contributed to the Company originating a higher percentage of less-valuable adjustable rate mortgage loans in the first quarter of 2004, as well as brokering a higher percentage of total loans processed in the quarter to third party mortgage companies, for which no gains on sales are realized by the Company. Higher general and administrative expenses were incurred to handle the higher volume of mortgage loan closings, as well as the record backlog level of the homebuilding segment.

MDC, whose subsidiaries build homes under the name "Richmond American Homes," is one of the largest homebuilders in the United States. The Company also provides mortgage financing, primarily for MDC's homebuyers, through its wholly owned subsidiary HomeAmerican Mortgage Corporation. MDC is a major regional homebuilder with a significant presence in some of the country's best housing markets. The Company is the largest homebuilder in Colorado; among the top five homebuilders in Northern Virginia, suburban Maryland, Phoenix, Tucson, Las Vegas and Salt Lake City; and among the top ten homebuilders in Northern California and Southern California. MDC also has a growing presence in Dallas/Fort Worth and has recently entered the Houston, Philadelphia/Delaware Valley, West Florida, Jacksonville and Chicago markets. For more information, please visit

  All earnings per share amounts discussed above are on a diluted basis.

  Forward-Looking Statements

Certain statements in this release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward- looking statements. Such factors include, among other things, (1) general economic and business conditions; (2) interest rate changes; (3) the relative stability of debt and equity markets; (4) competition; (5) the availability and cost of land and other raw materials used by the Company in its homebuilding operations; (6) the availability and cost of performance bonds and insurance covering risks associated with our business; (7) shortages and the cost of labor; (8) weather related slowdowns; (9) slow growth initiatives; (10) building moratoria; (11) governmental regulation, including the interpretation of tax, labor and environmental laws; (12) changes in consumer confidence and preferences; (13) required accounting changes; (14) terrorist acts and other acts of war; and (15) other factors over which the Company has little or no control.

                          M.D.C. HOLDINGS, INC.
               Condensed Consolidated Statements of Income
                 (In thousands, except per share amounts)

                                                      Three Months Ended
                                                          March 31,
                                                    2004          2003

    Homebuilding                                  $748,864       $554,912
    Financial Services                              14,448         14,513
    Corporate                                          292            217

      Total Revenues                              $763,604       $569,642


    Homebuilding                                  $113,445        $64,458
    Financial Services                               4,657          7,567

      Operating Profit                             118,102         72,025

    Corporate general and
     administrative expense, net                   (18,284)       (11,259)

   Income before income taxes                       99,818         60,766
   Provision for income taxes                      (38,917)       (23,729)

    Net Income                                     $60,901        $37,037

    Basic                                            $1.87          $1.16
    Diluted                                          $1.79          $1.12

    Basic                                           32,543         31,895
    Diluted                                         34,063         32,926

   DIVIDENDS DECLARED PER SHARE                      $.114          $.066

                          M.D.C. HOLDINGS, INC.
                     Information on Business Segments
                              (In thousands)

                                                        Three Months
                                                      Ended March 31,
                                                    2004           2003
    Home sales                                    $746,429       $553,575
    Land sales                                          --            123
    Other revenues                                   2,435          1,214
      Total Homebuilding Revenues                  748,864        554,912

    Home cost of sales                             551,024        427,602
    Land cost of sales                                  --             87
    Marketing                                       43,168         33,600
    General and administrative                      41,227         29,165
                                                   635,419        490,454
      Homebuilding Operating Profit                113,445         64,458

   Financial Services
    Interest revenues                                  930          1,008
    Origination fees                                 5,264          4,660
    Gains on sales of mortgage servicing               616            834
    Gains on sales of mortgage loans, net            6,777          7,342
    Mortgage servicing and other                       861            669
      Total Financial Services Revenues             14,448         14,513

   General and administrative                        9,791          6,946
    Financial Services Operating Profit              4,657          7,567

   Total Operating Profit                          118,102         72,025

    Interest and other revenues                        292            217
    General and administrative                     (18,576)       (11,476)
      Net Corporate Expenses                       (18,284)       (11,259)

   Income Before Income Taxes                      $99,818        $60,766

                          M.D.C. HOLDINGS, INC.
                         Selected Financial Data
             (Dollars in thousands, except per share amounts)

                                       March 31,  December 31,   March 31,
                                          2004        2003         2003

    Stockholders' Equity Per
     Share Outstanding                    $33.08      $31.27       $26.03

    Stockholders' Equity              $1,078,616  $1,015,920     $816,195
    Homebuilding and Corporate Debt      497,748     500,179      413,035
    Total Capital
     (excluding mortgage
     lending debt)                    $1,576,364  $1,516,099   $1,229,230

    Cash and Cash Equivalents            $99,079    $173,565      $58,073
    Unrestricted Cash and
     Available Borrowing
     Capacity Under Lines of Credit     $680,957    $779,407      556,098

    Ratio of Homebuilding and
     Corporate Debt to Equity                .46         .49          .51
    Ratio of Homebuilding and
     Corporate Debt to Capital               .32         .33          .34
    Ratio of Homebuilding and
     Corporate Debt to Capital
     (net of cash)                           .27         .24          .30

    Housing Completed or Under
     Construction Inventories           $794,943    $732,744     $634,677
    Land and Land Under Development
     Inventories                        $847,282    $763,569     $643,698

    Corporate and Homebuilding
     Interest Capitalized                Quarter   Full Year      Quarter
    Interest Capitalized in
     Inventories at Beginning
     of Period                           $20,043     $17,783      $17,783
    Interest Incurred During the
     Period                                7,366      26,779        7,052
    Interest in Home and Land Cost
     of Sales for the Period              (6,362)    (24,519)      (4,803)
    Interest Capitalized in
     Inventories at End of Period        $21,047     $20,043      $20,032
    Interest Capitalized as a
     Percent of Inventories                 1.3%        1.3%         1.6%

                                                      Three Months Ended
                                                          March 31,
                                                     2004           2003

    Interest in Home Cost of Sales as a
     Percent of Home Sales Revenues                   0.8%           0.9%
    Homebuilding and Corporate SG&A as a
     Percent of Home Sales Revenues                  13.8%          13.4%

    Depreciation and Amortization                   $8,930         $7,028

    Home Gross Margins                               26.2%          22.8%
     Excluding Interest in Home Cost of Sales        27.0%          23.7%

    Cash Provided by (Used in)
     Operating Activities                         $(43,220)       $34,635
    Cash Used in Investing Activities              $(2,299)       $(1,565)
    Cash Used in Financing Activities             $(28,967)       $(3,939)

    After-Tax Return on Revenues                      8.0%           6.5%
    After-Tax Return on Average Assets
     (Rolling 12 Months Ended)                       12.8%          11.6%
    After-Tax Return on Average Equity
     (Rolling 12 Months Ended)                       25.0%          22.7%

                          M.D.C. HOLDINGS, INC.
                      Homebuilding Operational Data
                          (Dollars in thousands)

                                        March 31,   December 31, March 31,
                                          2004         2003        2003

    Lots Owned                           18,692       16,351      16,054
    Lots Under Option                    13,272       12,251       6,813
    Homes Under Construction
     (including models)                   5,106        4,754       4,356

    (excluding homes under construction)
    Colorado                              5,186        5,206       5,628
    California                            3,451        3,512       3,001
    Nevada                                5,880        5,359       4,614
    Arizona                               7,477        5,258       3,515
    Utah                                  1,459        1,220         791
    Texas                                 2,399        2,203         800
    Virginia                              3,265        3,202       3,148
    Maryland                              1,721        1,767       1,370
    Florida                               1,081          875          --
    Illinois                                 45           --          --

      Total Company                      31,964       28,602      22,867

    Colorado                                 55           49          62
    California                               25           26          22
    Nevada                                   20           17          23
    Arizona                                  42           38          46
    Utah                                     14           11           7
    Texas                                    20           11           4
    Virginia                                 28           28          32
    Maryland                                 10            9           8
    Florida                                  11            9         - -

     Total Company                          225          198         204

                                                     Three Months Ended
                                                          March 31,
                                                     2004           2003

    Colorado                                        $261.5         $264.8
    California                                       386.9          399.9
    Nevada                                           206.6          186.6
    Arizona                                          191.0          175.8
    Utah                                             174.4          172.1
    Texas                                            161.6          150.7
    Virginia                                         408.2          359.9
    Maryland                                         419.5          369.0
    Florida                                          170.6             --

    Company Average                                 $256.5         $263.6

                          M.D.C. HOLDINGS, INC.
                      Homebuilding Operational Data
                          (Dollars in thousands)

                                                      Three Months Ended
                                                          March 31,
                                                      2004           2003
   Orders For Homes, net (Units)
    Colorado                                           691            671
    California                                         826            530
    Nevada                                           1,030            583
    Arizona                                            910            924
    Utah                                               176             93
    Texas                                              271             50
    Virginia                                           292            403
    Maryland                                           124            111
    Florida                                            109             --

      Total                                          4,429          3,365

   Homes Closed (Units)
    Colorado                                           478            609
    California                                         476            428
    Nevada                                             568            273
    Arizona                                            870            571
    Utah                                               104             40
    Texas                                               70             10
    Virginia                                           203            102
    Maryland                                            70             67
    Florida                                             71             --

      Total                                          2,910          2,100

                                 March 31,       December 31,   March 31,
                                   2004              2003         2003

   Backlog (Units)
    Colorado                          947             734         1,019
    California                      1,469           1,119         1,024
    Nevada                          1,348             886           660
    Arizona                         1,373           1,333         1,429
    Utah                              223             151           103
    Texas                             344             143            56
    Virginia                          943             854           777
    Maryland                          323             269           232
    Florida                           142             104            --

      Total                         7,112           5,593         5,300

   Backlog Estimated Sales
    Value                      $2,080,000      $1,600,000    $1,400,000
   Estimated Average Selling
    Price of Homes in Backlog      $292.5          $286.1        $264.2

SOURCE: M.D.C. Holdings, Inc.

CONTACT: Paris G. Reece III, Chief Financial Officer, +1-303-804-7706,, or Rachel L. Neumann, Communications Director,
+1-303-804-7729,, both of M.D.C. Holdings, Inc.