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Investing.com -- Shares in KB Home (NYSE:KBH) rose sharply on Wednesday after one of the largest home builders in the U.S. increased revenues by more than 15% and topped analysts' forecasts in the first quarter.
During the company's first quarter of Fiscal Year 2016, KB Homes increased its quarterly sales by 17% to $678.4 million, while housing revenues increased by 28% to $672.6 million for the period. At the same time, deliveries rose 23% to 1,953 homes, while increased slightly by $100,000 to $53.1 million on the quarter.
Overall, the company's net income soared 68% to $13.1 million, as diluted earnings per share increased to 0.14. Analysts expected to see adjusted earnings per share of 0.11 on revenues of $632.9 million.
"We are off to a strong start to 2016," said KB Home president and chief executive officer Jeffrey Mezger. "Solid execution on our key operating strategies drove measurable growth in revenues, operating margin and earnings. We ended the quarter with a healthy backlog and continued positive momentum in our core homebuilding business, reinforcing our favorable outlook for the full year."
In addition, KB Homes increased its housing gross profit margin 16.0%, in spite of a loss of 20 basis points due to inventory impairment and land option contract abandonment charges. The company's homebuilding operating income margin increased 30 basis points for the quarter, while adding 140 basis points excluding land sale results.
On Wednesday, the U.S. Census Bureau reported that new home sales rose 2.0% in February to an annual rate of 512,000, amid a surge in new single-family homes on the West Coast.
Shares in KB Homes gained 0.88 or 6.73% to 13.95 in after-hours trading.