(Adds executive and analyst comments, company background, share price)
SAO PAULO May 15 (Reuters) - Cyrela Brazil Realty SA , Brazil's largest homebuilder, should see general and administrative expenses remaining at their current level in coming quarters as it focuses on selling off finished inventory, executives said on Thursday.
The company reported an 8.7 percent drop in first-quarter net profit on Wednesday in comparison with a year earlier, while the sales value of finished stock rose to 1.1 billion reais ($495.5 million) from 971 million reais in the previous three months.
"We believe (finished inventory) is the major risk for Cyrela in 2014, with a possible negative impact on the gross margin, as the company ramps up project deliveries," wrote Espirito Santo Investment Bank analyst Eduardo Silveira in a client note on Thursday.
Shares of Cyrela were little-changed at 13.50 reais in afternoon Sao Paulo trading after opening slightly lower.
"It's very clear to us that our profitability will only return to the levels we would like them to be at when we address the issue of finished stock," Co-Chief Executive Officer Raphael Horn said on a conference call with analysts on Thursday. "We are 100 percent focused on this problem."
First-quarter earnings were also weighed down by a 16.9 percent rise in general and administrative expenses. Expenses should remain at current levels in coming quarters, Chief Financial Officer Eric Alencar said on Thursday's conference call. ($1 = 2.22 Brazilian reais) (Reporting by Asher Levine; editing by Matthew Lewis)