KB Home Moves to a ProfitOriginally published September 21, 2012 at 2:30 p.m., updated September 21, 2012 at 10:04 a.m.
KB Home moved to a profit in its fiscal third quarter as the builder was able to deliver more homes that were sold at higher prices.
The Los Angeles company on Friday reported net income of $3.26 million (4 cents a share) for the quarter ended Aug. 31, compared with a net loss of $9.6 million (-13 cents) in the same period a year earlier.
Revenue rose 16 percent to $425 million, with the average home sale price up nearly 8 percent to $245,100.
The company said it benefited from tax and insurance-related gains, an earlier strategic reorganization, and improvement in the industry as a whole as the U.S. housing market recovers.
"The strategic repositioning of our operations to restore profitability is starting to yield tangible results," Chief Executive Jeffrey Mezger said in a statement. "It (also) is clear that the recovery in housing is gaining momentum across the country as inventory levels are declining and home prices are on the rise.
Mezger said the company was seeing "dramatic improvement" in California, where it is the state's largest homebuilder. "Continued strengthening in the coastal markets is now spreading inland to Sacramento, the Central Valley and the Inland Empire," he added.
Shares closed up 2.15, or 16.4 percent, to $15.26 on the New York Stock Exchange.