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Thursday, June 28, 2007

KB Home Reports Second Quarter 2007 Loss

by Calculated Risk on 6/28/2007 09:16:00 AM

"Our second quarter results reflect the current oversupply of new and resale housing inventory, a difficult situation compounded by aggressive competition and continued weak demand. Housing affordability challenges and tighter credit conditions in the subprime and near-prime mortgage market have also exacerbated current market dynamics, keeping prospective buyers out of the market, slowing the absorption of excess supply and further delaying a housing market recovery. Pricing pressure intensified in many of our markets during the second quarter, compressing margins and requiring inventory impairment charges in certain of our communities."
Jeffrey Mezger, president and CEO, KB Home, June 28, 2007 emphasis added.
And for the quarter:
Housing revenues of $1.30 billion were down 41% from the prior year's second quarter, the result of a 36% year-over-year decline in unit deliveries to 4,776 and an 8% year-over-year decrease in the average selling price to $271,600....

The Company reported a loss from continuing operations of $174.2 million or $2.26 per diluted share in the second quarter of 2007 ...