KB Home books a fourth-quarter profit
The company said this morning that net income was $100.7 million ($1.31 per share) for the three months ended Nov. 30 compared with a loss of $307.3 million ($3.96 per share) for the same period in 2008.
The company took advantage of a new tax rule that allowed it to offset past losses. Before taxes, the company said it lost $91 million in the fourth quarter.
Revenues totaled $674.6 million in the fourth quarter of 2009, down 27% from $919.0 during the same period last year. The decline was primarily due to lower housing revenues, the company said.
The company’s shares had fallen 5% to $15.53 at 8:05 a.m. PST following the news.
Jeffrey Mezger, president and chief executive officer of KB Home, said this morning that the outlook for the housing market was uncertain.
"Looking forward into 2010, there are indications that housing-market conditions may be stabilizing in some regions, reflecting, among other things, relatively high levels of affordability,” he said in a statement. “This is tempered, however, and could ultimately be undermined, by persistent economic weakness and unemployment, changes in federal government monetary and fiscal policies and programs, and by the impact of rising foreclosures and mortgage loan delinquencies.”
The market for new homes in the U.S. remains tenuous and heavily reliant on government aid. Sales of all new homes in November plunged 11.3%, the government reported recently.
The drop reflected uncertainty over a first-time home-buyer tax credit that was initially set to expire Nov. 30. Federal lawmakers in November extended it through April and expanded it to include some buyers who already own a house.
But the extension didn't come in time to entice purchasers to commit to entering into new-home contracts in November, and many experts believe that response to the extension of the credit will be muted or, at best, won't translate into another pickup in sales until the spring as the new deadline approaches.
For the year, KB Home lost $101.8 million ($1.33 per share), compared with a 2008 net loss of $976.1 million ($12.59 per share).
For the year, revenues fell 40% to $1.82 billion compared with $3.03 billion in 2008.
-- Alejandro Lazo
Photo: Jae C. Hong / Associated Press