The Los Angeles-based company builds and sells homes through its operating divisions and operates in nine states and 32 markets, including Arizona, Colorado, North Carolina and Virginia.
For the three month period that ended May 31, KB Home narrowed its net loss to $24.1 million, or 31 cents per diluted share, beating analyst estimates. That compares with a loss of $68.5 million, or 89 cents per diluted share, in the prior year quarter.
The latest quarter included a $4.5 million state income refund, which topped the income tax benefit of $300,000 seen a year-ago.
Total sales grew 11 per cent to $302.9 million versus $271.7 million a year earlier, as the company benefited from higher average selling prices and more homes delivered.
Analysts polled by Bloomberg expected a per-share loss of 33 cents, on $295 million in sales for the period that ended May 31.
The company’s share price climbed 5.63 per cent in early morning trade, hitting $9.19 in New York on Friday.
In the West Coast, sales were up 24 per cent. Sales in the Southeast rose five per cent, with revenue up four per cent in the Central US region.
The company delivered 1,290 homes in the quarter, up two per cent. The company saw increases of 13 and 5 per cent in the Central and Southeast regions, respectively, partly offset by decreases in the West Coast and Southwest regions.
Average selling prices logged in 9 per cent higher, reaching $233,000 versus $213,400 a year-ago, reflecting a 33 per cent increase in the West Coast region and a 14 per cent rise in the Southwest.
Backlog at the end of the quarter reached 2,962 homes, up from the 2,422 homes in the year-ago period.
Housing gross profit margins leaped to 16.9 per cent from 7.3 per cent the year before and from 9.7% in the first quarter.
"Entering the second half of 2012, we have a strong backlog of homes with higher selling prices and better margins to help restore profitability, and we anticipate achieving further gains in our margin performance as our revenue growth and cost-management efforts take hold," chief executive Jeffrey Mezger said in a statement.