April 27, 2010 / 12:07 AM / 8 years ago

UPDATE 2-Mexico's Homex posts 2.6 pct drop in 1st-qtr net

* Net profit declines 2.6 pct

* Company reaffirms 2010 guidance (Adds detail on EBITDA, free cash flow)

MEXICO CITY, April 26 (Reuters) - Mexican homebuilder Homex HXM.N(HOMEX.MX) said on Monday its first-quarter net profit was 188 million pesos ($15 million), down 2.6 percent from the year-ago period following a change in accounting rules.

Revenues in the first quarter were 3.6 billion pesos ($291 million), up 12 percent over the same quarter the year before.

Homex said it sold 9,777 houses during the quarter, down slightly from 9,859 in the year ago as it concentrated on more profitable niches in the social interest and low-medium segments. Average prices of homes titled and sold rose 11.7 percent in the quarter.

Earnings before interest, taxes, depreciation and amortization rose to 803 million pesos in the quarter from 674 million pesos in the year-ago period due to improved operational efficiencies.

Sinaloa-based Homex had a negative free cash flow of 767 million pesos in the quarter as accounts receivable increased compared to the last quarter of last year.

In the first quarter, Homex began to report current and past results using new accounting rules. Under the rules, companies recognize revenues and costs when the homes they build are legally transferred to customers. In the past, companies including Homex based their results on the percentage of completion of houses being built.

Homex reaffirmed its guidance of revenue growth between 12 percent and 14 percent this year and an EBITDA margin between 21 percent and 22 percent.

Homex shares ended down 0.37 percent at 64.30 pesos before quarterly results were released.

$1 = 12.387 pesos at end-March Reporting by Noel Randewich; editing by Carol Bishopric

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