KB Home posts a narrower loss, awaits recovery

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As the new home market struggles to find its footing, executives at Los Angeles builder KB Home aren’t quite ready to call the bottom. The company said today that its revenue for the three months ended in August fell 33%, to $458.5 million from $681.6 million in the same period a year earlier.

KB Home lost $66 million, or 87 cents a share, in the third quarter. The loss was smaller than the $144.7 million, or $1.87 a share, that KB Home lost in the same period last year, but was worse than analysts had projected. Analysts polled by Thomson Reuters were expecting a loss of 58 cents a share on revenue of about $457.9 million.

KB Home Chief Executive Jeffrey Mezger said in a conference call with analysts that “the precise timing of a market recovery remains uncertain,” and foreclosures and unemployment are the industry’s chief challenges.

“It’s difficult for the housing sector to build momentum as long as potential home buyers lack job security,” he said.

Builders’ expectations are modest in this climate, as KB Home Controller Bill Hollinger said in the conference call, “we are edging closer to breaking even.”

-- Peter Hong