KB Home (KBH) reported a net loss of $30.7m, or $0.40 per share, for its fiscal year Q210 ending May 31, narrowed losses for the Los Angeles-based builder, which said it saw home deliveries increase for the first time in more than three years. The Q210 loss is 61% less than its Q110 loss of $78.4m, or $1.03 per share. At the end of its 2009 fiscal year, KB Home posted a $100m quarterly profit, the result of a nearly $192m tax return made possible by a temporary change to tax law. In addition, KB Home said it had no asset impairment or land option contract abandonment charges this quarter, compared to $49.5m of charges in Q209. “With a mix of positive and negative factors affecting the housing market in the second quarter, we maintained favorable trends in our gross, operating and pretax margins, as well as in our bottom line results, through the consistent implementation of our strategic initiatives,” KB Home president and CEO Jeffrey Mezger, said in the company’s quarterly filing. Total revenue was $374.1m in Q210, down from $384.5m in Q209. The average selling price of $207,900 is down 4% from a year ago. The lower housing revenue contributed to the decline in revenue, the company said. However, KB Home said it delivered 1,782 houses, up 1% from a year ago. While slight, it’s the first year-over-year increase in deliveries in 14 quarters. “Our net orders were up sequentially from this year’s first quarter and were solid on a per community basis,” Mezger added. ” We believe this bodes well for our ability to generate future revenue growth as we expand our community count. To support this expansion, we continue to invest opportunistically in attractive land assets that meet our strict financial and operational requirements.” The company is taking advantage of declined property values, adding 4,300 lots to its inventory of land it either owns outright or holds an option to purchase in the future during the quarter. Land acquisition was focused predominately in the West Coast and central regions of the US. KB Home owns or controls nearly 40,000 lots. At the end of the quarter, KB Home had $1.09bn in cash and equivalents. Its debt balance totaled $1.76bn, down $65m from November, the end of its 2009 fiscal year. Total housing backlog was 3,175 houses, representing future potential revenue of $648.2m, down from a backlog of 3,804 houses and future revenue of $796.9m a year ago. KB Home said its net orders totaled 2,244 at the end of Q210, down 23% from 2,910 in Q209, impacted by the company’s lower community count, weak economic conditions and the expiration of the homebuyer tax credit. From Q110 to Q210, net orders are up 17%. For the first-half of its 2010 fiscal year ending May 31, company revenue totaled $638m, down 8% from $691.8m in the first half of fiscal year 2009, mainly due to lower housing revenue. Write to Austin Kilgore. The author held no relevant investments.
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