* Net income of 5 mln reais misses 15 mln reais forecast
* Fewer housing starts, focus on deliveries boosts cash flow
* New 2012 operational cash flow forecast 600 mln-800 mln reais
SAO PAULO, Nov 12 Brazilian homebuilder Gafisa SA posted a small profit in the third quarter and raised its full-year target for operational cash flow, as it focused on delivering older projects and reducing debt levels.
Gafisa reported net income of 5 million reais ($2 million) in a securities filing on Monday, improving from a revised 51 million reais loss a year earlier, but missing an estimated profit of 15 million reais forecast in a Reuters survey.
Brazil's biggest homebuilder is scaling back operations after years of poorly-controlled growth to reduce debts and finish developments that have exceeded budgets and timelines.
With a greater focus on delivering older projects, Gafisa generated 149 million reais of cash from operations in the third quarter. In the nine months through September, the builder passed the midpoint of its former 2012 cash flow guidance of 500 million to 700 million reais. Its new target is 600 million to 800 million reais of cash generated from operations this year.
Ongoing cancellations in the low-income Tenda unit continued to weigh on revenue, as the company scrapped sales contracts with clients whose credit profile deteriorated while they waited for the homebuilder to finish their apartments.
Still, Tenda cancellations eased 20 percent from the prior quarter to 264 million reais and the company resold 70 percent of the Tenda units that returned to inventory so far this year.
Earnings before interest, taxes, depreciation and amortization, a gauge of operating profit known as EBITDA, totaled 183 million reais in the quarter, beating a forecast of 149 million reais in the Reuters poll. (Reporting by Brad Haynes; Editing by Eric Meijer)