KB Home (NYSE:KBH), the U.S. homebuilder that targets first-time buyers, said net loss in the second quarter narrowed by 88 percent and sales jumped 73 percent, topping estimates, as the number of delivered homes increased and average selling prices rose. Shares rise to one-week high.
Net loss for the three months ended May 31 narrowed to $2.97 million, or 4 cents a share, compared to a loss of $24.14 million, or 31 cents a share, a year earlier, the Los Angeles, California-based company said in a statement on Thursday.
Excluding a $15.9 million water intrusion-related charge, KB Home generated net income of $12.9 million for the fiscal second quarter versus a net loss a year earlier.
Revenue in the March-to-May period rose 73 percent to $524.4 million, "reflecting an increase in the number of homes delivered and higher average selling prices across all of the Company’s homebuilding regions."
The average estimate of 22 analysts polled by Thomson Reuters was for a net loss of 7 cents a share on $450.8 million in revenue.
Homes delivered in the quarter rose 39 percent from the year-earlier quarter to 1,797 homes, the seventh consecutive quarter of year-over-year growth, KB Home said. The company's overall average selling price increased 25 percent to $290,400 in the second quarter from a year earlier.
KB Home said it generated a second-quarter operating profit for the first time since 2006.
"Our outlook for 2013 remains favorable even with the second quarter charge associated with water intrusion repairs, which we believe puts the financial impact of the matter behind us." Chief Executive Officer Jeffrey Mezger said in the statement.
"We remain confident that we are on course to achieve a solidly profitable 2013, with meaningful profits expected in each of the final two quarters of the year, and will continue to build positive momentum entering 2014," he added.
The shares advanced as much as 4.3 percent to $20.75, the highest intraday price since June 20, and were trading at $20.60, up 3.7 percent, at 9:50 a.m. in New York on Thursday. The stock had gained approximately 26 percent this year through Wednesday.