KB Home (KBH) Post Smaller Q1 Loss on Better Sales

March 21, 2013 8:36 AM EDT
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Price: $43.37 +0.32%

EPS Growth %: +172.7%

Financial Fact:
Net loss: 39.36M

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KB Home (NYSE: KBH) reported Q1 EPS of ($0.16), $0.06 better than the analyst estimate of ($0.22). Revenue for the quarter came in at $405.2 million versus the consensus estimate of $359.8 million.

The Company delivered 1,485 homes, up 29% from the first quarter of 2012, reflecting increases in three of its four homebuilding regions.

The overall average selling price of $271,300 was $52,300, or 24%, higher than the year-earlier quarter, marking the Company’s 11th consecutive quarter of year-over-year improvement, and its highest first-quarter average selling price since 2006.

Potential future housing revenues in backlog at February 28, 2013 increased to $703.9 million, up 53% from $460.0 million at February 29, 2012

"Our strategies targeting growth and profitability are working as evidenced by our significantly improved financial and operational results in the first quarter,” said Jeffrey Mezger, president and chief executive officer. “Our revenues grew by 59% from a year ago, driven by both higher deliveries and increased pricing power in our served markets, reflecting the success of our land repositioning initiatives and a shift in consumer demand to larger homes. Our revenue growth, combined with our actions to generate greater operating efficiencies and reduce sales incentives, increased our operating margin significantly and produced substantially better bottom line results. We also experienced robust net order growth and ended the quarter with our backlog value up 53% from a year ago. These results, in combination with our current strategic growth plans, the strengthening recovery of housing markets, low mortgage interest rates and firming consumer confidence, reinforce our optimism for the remainder of the year.”

“We also made major strides during the quarter to support accelerating our future growth,” continued Mezger. “We raised more than $330 million from the successful sale of convertible senior notes and common stock, maintained our aggressive pursuit of available opportunities by investing nearly $350 million in land and land development — more than triple the amount we invested in the year-earlier quarter — in desirable locations within strong growth markets. In March, we further bolstered our available financial resources by entering into a $200 million revolving credit facility. With an operational footprint that can be leveraged for substantial expansion, land positions in attractive markets across the country, and significant financial flexibility to amplify our investments in land and land development, we remain confident that we have a solid growth platform to expand our community count, deliveries and revenues as 2013 unfolds. Based on the strategic steps we have taken, our improved performance over the past year and the accelerating momentum we are seeing in our business, we are confident that we will achieve our profitability goal for 2013."

For earnings history and earnings-related data on KB Home (KBH) click here.


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