Shares of KB Home fell after the company announced an 8 percent drop in new orders for the first quarter of 2012 along with a greater-than-expected net loss.
The net loss at the Los Angeles-based homebuilder for the quarter ended Feb. 29 was $46 million (-59 cents a share), compared to a loss of $115 million (-$1.49) in the same quarter a year earlier. Based on a Bloomberg survey, analysts on average expected a loss of 23 cents a share.
Net orders totaled 1,197 homes in the first quarter, a decrease of 8 percent from the first quarter last year. The company blamed a 36 percent cancellation rate for the sales slump, an increase from the 29 percent cancellation rate in the same quarter last year.
“While we are encouraged by the recent positive economic and housing market trends, our operational and financial results for the first quarter were mixed,” Chief Executive Jeffrey Mezger said in a statement. “Although our orders moderated … we posted growth in our deliveries and revenues and reduced our net loss significantly from the prior year.”
By late morning Friday, shares of KB Home lost 68 cents or 6 percent to trade at $10.57 on the New York Stock Exchange.