KB Home loss wider than expected

NEW YORK (Reuters) - Home builder KB Home (KBH.N: Quote, Profile, Research) posted a wider-than-expected quarterly loss on Friday as the U.S. housing market continued its steep decline, and said it did not expect conditions to improve any time soon, sending its shares down 3.3 percent in early trading.

"Until prices stabilize and consumer confidence returns, we believe inventory levels will remain significantly out of balance with demand," CEO Jeffrey Mezger said in a statement. "We do not anticipate meaningful improvement in these conditions in the near term."

Results continued to be dragged down by charges, but the impairment charge of $223.9 million was much smaller than the previous quarter's $403 million, said JMP Securities analyst James Wilson.

"While still significant, we believe the trend is likely now starting to head downward," Wilson said in a research note. JMP has a "market outperform" rating on KB stock.

The No. 5 U.S. home builder reported a net loss of $268.2 million, or $3.47 per share, for its fiscal first quarter, ended February 29, compared with a year-earlier profit of $27.6 million, or 34 cents per share.

Excluding a tax-related charge, KB lost $2.17 per share, wider than the $1.35 per share loss expected by analysts, according to Reuters Estimates.

Revenues fell 43 percent to $794.2 million, reflecting both a smaller number of homes and lower prices, KB said. The company delivered 2,928 homes during the quarter at an average price of $248,200.

Analysts had expected $854.9 million in sales for the quarter.

Net orders plunged 75 percent, partly reflecting a smaller number of the company's active selling communities. Its cancellation rate of 53 percent was down from 58 percent in the prior quarter.