UPDATE 1-M/I Homes new contracts fall in Q1

(Recasts, adds details)

April 10 (Reuters) - Single-family home builder M/I Homes Inc (MHO.N) said new contracts fell more than 40 percent during the first quarter, but cancellation rate was slightly lower than a year ago.

The company cut its debt to $42 million from $115 million in the quarter, and amended the terms of an unsecured credit line, which, it said, would provide "additional financial flexibility."

Shares of the company rose nearly 7 percent to $18.33 in early morning on the New York Stock Exchange.

New contracts fell to 554 from 931 a year ago and new home deliveries fell 34 percent to 450 units.

Cancellation rate fell by 2 percent to 23 percent.

Backlog units at the end of March nearly halved to 816, with an average sales price of $297,000, the company said in a statement.

"Selling conditions in most of our markets remain difficult," Chief Executive Officer Robert Schottenstein said in a statement. (Reporting by Amulya Nagaraj in Bangalore; Editing by Anil D'Silva)