KB Home Inc. shares were up nearly 7% in early trading Wednesday after the Los Angeles home builder said it posted a first-quarter profit for the first time since 2007.
Revenue, home prices and future orders rose significantly as the company continued to benefit from the rebound of the housing market.
The company reported revenue of $451 million for the three months ended Feb. 28, up 11% from the $405 million of revenue it posted in the same period a year earlier.
The average selling price of a new home was $305,200, an increase of $33,900, or 12%, from the year-earlier quarter.
KB Home reported $10.6 million of profit for the quarter, compared with a loss of $12.5 million a year ago.
The company said the overall value of net orders for the quarter was $600 million, up 18% from $507 million for the year-earlier quarter.
"We are pleased by our first-quarter results," said Jeffrey Mezger, KB Home's president and chief executive officer. "Building on the momentum and the full-year profitability our business achieved in 2013, we posted net income in the first quarter for the first time since 2007, along with higher average selling prices, increased revenues, expanded gross margins and improved operating leverage. We believe this performance reflects the continued success of our strategic initiatives, and gives us a firm foundation to deliver on our financial objectives for the year."
On the downside, the company said home-building revenues were down 12% in its West Coast region. The company produced gains in its Southwest (45%), central (18%) and Southeast (63%) regions.
KB Home shares were up $1.20, or 6.8%, to $18.88 at 8:50 a.m. PDT.