KB Home (KBH) today reported results for its second quarter ended May 31, 2012.
- Revenues totaled $302.9 million, up 11% from $271.7 million for the second quarter of 2011
- Revenues up 24% in the West Coast region, 5% in the Southeast region, and 4% in the Central region for the three of the Company’s four homebuilding regions.
- Delivered 1,290 homes
- 33% increases of the average selling price in the West Coast region and 14% in the Southwest region.
- Gross profit margin improved to 16.9% from 7.3% in the second quarter of 2011 and 9.7% in the first quarter of 2012.
- Excluding inventory impairment charges of $9.9 million in the current quarter and inventory impairment and land option contract abandonment charges of $20.6 million in the year-earlier quarter, the second quarter housing gross profit margin was 20.3% in 2012 and 14.9% in 2011.
- Selling, general and administrative expenses totaled $66.5 million, compared to $62.5 million in the year-earlier quarter. Selling, general and administrative expenses as a percentage of housing revenues improved to 22.1% from 23.2% in the year-earlier quarter.
- The homebuilding operating loss narrowed substantially to $15.5 million from $57.5 million in the year-earlier quarter.
- The homebuilding operating loss as a percentage of homebuilding revenues improved to 5.2%, from 21.3% in the second quarter of 2011 and 12.4% in the first quarter of 2012.
- The Company’s net loss of $24.1 million, or $.31 per diluted share, narrowed significantly from the net loss of $68.5 million, or $.89 per diluted share, in the year-earlier quarter.
- Total cash and cash equivalents of $377.4 million at May 31, 2012 included unrestricted cash of $314.3 million. At February 29, 2012, cash and cash equivalents totaled $368.1 million, including unrestricted cash of $304.2 million.
- The Company generated $19.7 million of positive net cash flow from operating activities in the 2012 second quarter, compared to $109.6 million of net cash used by operating activities in the first quarter of 2012.
- The Company owned and controlled 44,695 lots as of May 31, 2012, an increase of 11% from 40,170 lots owned and controlled at November 30, 2011.
- The Company’s debt balance of $1.58 billion at May 31, 2012 remained level compared to November 30, 2011.
Jeffrey Mezger, KBH’s President and chief Executive Officer, commented:
Our second quarter results reflect the continued repositioning of our operations and investments to stronger, highly desirable, land-constrained submarkets that support sales of larger, higher-priced homes to our core first-time and first move-up customers. The impact of our strategic product and community placement can be seen in our improved financial and operating results in the quarter as we pursue our goal of returning to profitability. We generated a year-over-year increase in our average selling price for the eighth consecutive quarter, which drove a double-digit increase in our revenues and substantial improvement in our bottom line results. In addition, the value of our second quarter net orders grew by 18% from the prior year on only a modest increase in net orders. We expect the benefits of our repositioning efforts and the shifting of our geographic footprint to become more fully realized in future quarters.
Katoiya Marshall – Manager, Investor Relations
Tel: (310) 231-4000
Fax: (310) 231-4140
KB Home is one of the largest and most recognized homebuilding companies in the United States. Since its founding in 1957, the company has built more than half a million quality homes. KB Home’s signature Built to Order™ approach lets each buyer customize their new home from lot location to floor plan and design features.