LOS ANGELES--(BUSINESS WIRE)--
KB Home (NYSE: KBH) today announced that it has elected to exercise its
optional redemption rights under the terms of its 9.100% Senior Notes
due 2017 ("Notes"), which mature on September 15, 2017.
On January 13, 2017, KB Home will redeem $100 million in aggregate
principal amount of the Notes then outstanding at the redemption price
calculated according to the "make-whole" provisions of the Notes, as
outlined in the redemption notice issued by U.S. Bank National
Association, the trustee for the Notes.
"Our strategy of growing scale in our served markets, and increasing our
operating profits, positions us to generate the cash to support both our
future growth and a reduction of our debt balance. The early redemption
of $100 million of our 2017 senior notes - our most expensive debt -
with internally generated cash reinforces this point and represents an
initial step toward deleveraging," said Jeffrey Mezger, chairman,
president and chief executive officer.
"At our investor conference in October, we shared a roadmap for
accelerating profitable growth, increasing return on invested capital,
and improving our net debt-to-capital ratio to between 40% and 50% by
2019. We are making progress toward our objectives with a balanced
approach to capital allocation, as we work to deliver higher stockholder
value," concluded Mezger.
About KB Home
KB Home (NYSE: KBH) is one of the largest and most recognized
homebuilders in the United States and an industry leader in
sustainability, building innovative and highly energy- and
water-efficient new homes. Founded in 1957 and the first homebuilder
listed on the New York Stock Exchange, the Company has built nearly
600,000 homes for families from coast to coast. Distinguished by its
personalized homebuilding approach, KB Home lets each buyer choose their
lot location, floor plan, décor choices, design features and other
special touches that matter most to them. To learn more about KB Home,
call 888-KB-HOMES, visit www.kbhome.com
or connect on Facebook.com/KBHome
or Twitter.com/KBHome.
Forward-Looking and Cautionary Statements
Certain matters discussed in this press release, including any
statements that are predictive in nature or concern future market and
economic conditions, business and prospects, our future financial and
operational performance, or our future actions and their expected
results are "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are based on current expectations and projections about
future events and are not guarantees of future performance. We do not
have a specific policy or intent of updating or revising forward-looking
statements. Actual events and results may differ materially from those
expressed or forecasted in forward-looking statements due to a number of
factors. The most important risk factors that could cause our actual
performance and future events and actions to differ materially from such
forward-looking statements include, but are not limited to the
following: general economic, employment and business conditions;
population growth, household formations and demographic trends;
conditions in the capital, credit and financial markets; our ability to
access external financing sources and raise capital through the issuance
of common stock, debt or other securities, and/or project financing, on
favorable terms; material and trade costs and availability; changes in
interest rates; our debt level, including our ratio of debt to capital,
and our ability to adjust our debt level and maturity schedule; our
compliance with the terms of our revolving credit facility; volatility
in the market price of our common stock; weak or declining consumer
confidence, either generally or specifically with respect to purchasing
homes; competition from other sellers of new and resale homes; weather
events, significant natural disasters and other climate and
environmental factors, including the severe prolonged drought and
related water-constrained conditions in the southwest United States and
California; government actions, policies, programs and regulations
directed at or affecting the housing market (including the Dodd-Frank
Act, tax benefits associated with purchasing and owning a home, and the
standards, fees and size limits applicable to the purchase or insuring
of mortgage loans by government-sponsored enterprises and government
agencies), the homebuilding industry, or construction activities; the
availability and cost of land in desirable areas; our warranty claims
experience with respect to homes previously delivered and actual
warranty costs incurred; costs and/or charges arising from regulatory
compliance requirements or from legal, arbitral or regulatory
proceedings, investigations, claims or settlements, including
unfavorable outcomes in any such matters resulting in actual or
potential monetary damage awards, penalties, fines or other direct or
indirect payments, or injunctions, consent decrees or other voluntary or
involuntary restrictions or adjustments to our business operations or
practices that are beyond our current expectations and/or accruals; our
ability to use/realize the net deferred tax assets we have generated;
our ability to successfully implement our current and planned strategies
and initiatives related to our product, geographic and market
positioning (including our plans to transition out of the Metro
Washington, D.C. area); gaining share and scale in our served markets;
our operational and investment concentration in markets in California;
consumer interest in our new home communities and products, particularly
from first-time and first move-up homebuyers and higher-income
consumers; our ability to generate orders and convert our backlog of
orders to home deliveries and revenues, particularly in key markets in
California; our ability to successfully implement our returns-focused
growth strategy and achieve the associated revenue, margin,
profitability, cash flow, community reactivation, land sales, business
growth, asset efficiency, return on invested capital, return on equity,
net debt-to-capital ratio and other financial and operational targets
and objectives; the ability of our homebuyers to obtain residential
mortgage loans and mortgage banking services; the performance of
mortgage lenders to our homebuyers; completing the wind-down of Home
Community Mortgage as planned, and the management of its assets and
operations during the wind-down process; whether we can establish and
operate a joint venture or other relationship with a mortgage banking
services provider; information technology failures and data security
breaches; and other events outside of our control. Please see our
periodic reports and other filings with the Securities and Exchange
Commission for a further discussion of these and other risks and
uncertainties applicable to our business.
View source version on businesswire.com: http://www.businesswire.com/news/home/20161215005210/en/
KB Home
Jill Peters, Investor Relations Contact
310-893-7456
investorrelations@kbhome.com
Source: KB Home
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