KB Home (NYSE:KBH), Los Angeles, on Tuesday after market close reported net income of $39.4 million for its fiscal third quarter ended August 31, up 69% from the same period last year. Earnings per diluted share increased 83% to $0.42, ahead of analyst estimates of $0.39 per share.

Shares were up 6% to $14.94 in after-market trading Tuesday.

Revenues for the quarter were up 8% to $913.3 million increased 8%, with housing revenues up 14%. The comparison suffered from $41.6 million in land-sale revenue in last year's quarter versus none this quarter.

Deliveries grew 11% to 2,487 homes, reflecting double-digit increases in the West Coast and Central regions. The average selling price increased 2% to $365,900.

Net order value for the quarter grew 20% to $929.6 million as orders increased 16% to 2,508. The cancellation rate as a percentage of beginning backlog for the quarter improved to 19% from 20%, and as a percentage of gross orders improved to 29% from 30%.

Homes in backlog rose 12% to 5,226, and quarter's-end backlog value grew 17% to $1.85 billion, reflecting increases in all of the Company's regions.

Average community count for the quarter decreased 9% to 235.

Housing gross profit margin increased 20 basis points to 16.4%. Excluding inventory-related charges of $3.1 million, housing gross profit margin rose to 16.8%.

Selling, general and administrative expenses improved 110 basis points to 10.8% of housing revenues.

All interest incurred was capitalized, resulting in no interest expense as compared to $4.4 million of interest expense.

Financial services pretax income decreased 11% to $2.4 million. KB and Nationstar Mortgage LLC have begun the process of winding down the mortgage banking joint venture, Home Community Mortgage, LLC, and transferring Home Community Mortgage's assets and operations to Stearns Lending, LLC. Currently, Stearns Lending is offering mortgage banking services to the company's home buyers, and KB said it and Stearns Lending are working to establish a new relationship.

"Housing market conditions remain healthy, with positive employment, higher household income and economic trends supporting steady consumer demand amid constrained supply," said Jeffrey Mezger, chairman, president and chief executive officer. "In this environment, we believe we have the strategies in place to strengthen and leverage our growth platform to expand our business and increase market share across our current geographic footprint."

The company ended the quarter with cash, cash equivalents and restricted cash totaled $335.3 million, inventories of $3.60 billion, and lots owned or controlled of 46,636 81% owned. There were no cash borrowings outstanding under the unsecured revolving credit facility.