KB Home Earnings Slide on Weak Housing Market, But Beat Estimates
KB Home , the 5th largest U.S. home builder, said quarterly net profit fell 84%, reflecting the sharp decline in the U.S. housing market.
For its fiscal first quarter, ended Feb. 28, KB reported a net profit of $27.5 million, or 34 cents a share, down from $173.3 million, or $2.01 last year. The results were well above analysts' estimates of 25 cents a share, as polled by Thomson Financial.
Revenues fell 19% to $1.767 billion, but that was still above consensus expectations of $1.613 billion. The lower house revenue reflected a 5% lower average selling price of $261,400 and 16% fewer closings.
Net orders for new homes fell 12% to 7,677, with most of the decline occurring in the Southwest and Central regions. The company's cancellation rate improved sharply in the first quarter of 2007 to a more normalized 31% compared with the prior quarter's 48%.