Published June 27, 2014
KB Home (KBH) turned a profit in its second quarter amid an increase in selling prices.
The fifth-largest U.S. homebuilder booked earnings of $26.6 million, or 27 cents a share, compared to a loss of $3 million, or four cents a share, in the year-ago period. Revenue jumped 7% to $565 million.
The results easily topped Wall Street expectations. Analysts were looking for a per-share profit of 19 cents and revenue of $563.1 million.
KB Home and other homebuilders have benefited from an uptick in selling prices, and KB Home reported positive signs for future business. For the period ended May 31, KB Home reported backlog of 3,398 homes, up 9% year-over-year.
“With the momentum we have generated through the first half of the year and our robust backlog, we believe we are on track to meet our fiscal 2014 goals,” chief executive Jeffrey Mezger said in a statement.
Mezger added that KB Home acquired several large land positions in the second quarter “to reinforce the upward trajectory of our business.”
The Los Angeles-based company said the average selling price of its homes climbed 10% to $319,700, although deliveries fell 2.6% to 1,751 units.
Net orders during the period rose 5% to 2,269 homes. The value of those orders increased 19% to $763.2 million.
Earlier this week, Lennar (LEN) reported a slightly better profit on stronger deliveries and prices. Luxury homebuilder Toll Brothers (TOL) also sold more homes at higher prices in its second quarter.
KB Home shares were up nine cents, or 0.5%, at $17.97 in recent trading.