KB Home Profit 4Q, Revenue Increase – Profit Review
By Maria Armental
Home builder KB Home posted higher profits and revenues in the fourth quarter, helped by strong demand despite a disruption in the supply chain. Here’s what you need to know:
PROFIT: Fourth quarter profit reached $ 174.2 million, up from $ 106.1 million a year earlier. On a per share basis, earnings were $ 1.91. Analysts polled by FactSet were expecting $ 1.77 per share.
REVENUES: Total revenue for the quarter ended Nov. 30 reached $ 1.68 billion, from $ 1.19 billion a year earlier. Analysts were expecting $ 1.71 billion.
KEY FIGURES: Net order value increased 12% to $ 1.77 billion; the value of the backlog at the end increased 67% to $ 4.95 billion. The cancellation rate as a percentage of gross orders for the quarter was essentially flat at 13%, the company said.
YEARLY RESULTS: KB Home ended the year with profit of $ 564.7 million on revenue of $ 5.72 billion, compared to profit of $ 296.2 million and of $ 4.18 billion dollars a year earlier.
QUOTE FROM THE CEO: “Although operating conditions in 2021 have been extremely difficult, with labor shortages and supply chain disruptions, as well as municipal and related delays, our teams have remained resilient by working on solutions with our business partners and suppliers, ”CEO Jeffrey Mezger said in a statement.
OUTLOOK: KB Home expects $ 7.2 to $ 7.6 billion in real estate income this year, with an average sale price ranging from $ 480,000 to $ 490,000.
“The value of our nearly $ 5 billion backlog and the expected substantial year-over-year increase in the number of communities are supporting significant revenue growth this year,” Mezger said. “Combined with a significant acceleration in our operating margin that we anticipate this year, we expect to produce a return on equity in excess of 26%,” he added.
Write to Maria Armental at [email protected]