Subsequent Event

3 Months Ended

Feb. 29, 2020

Subsequent Events [Abstract]

Subsequent Event

Subsequent Event

On March 11, 2020, the World Health Organization characterized the outbreak of the coronavirus disease known as COVID-19 as a global pandemic and recommended containment and mitigation measures. On March 13, 2020, the United States declared a national emergency concerning the outbreak, and several states and municipalities have declared public health emergencies. Along with these declarations, there have been extraordinary and wide-ranging actions taken by international, federal, state and local public health and governmental authorities to contain and combat the outbreak and spread of COVID-19 in regions across the United States and the world, including quarantines, and “stay-at-home” orders and similar mandates for many individuals to substantially restrict daily activities and for many businesses to curtail or cease normal operations.

In response to these steps, in mid-March, we temporarily closed our sales centers, model homes and design studios to the general public. During this time, we have shifted to an appointment-only personalized home sales process where permitted, following recommended distancing and other health and safety protocols when meeting in person with a customer, and we

are leveraging our virtual sales tools to give customers the ability to shop for a new KB home from their mobile device or personal computer. Combined with our limiting construction operations largely to authorized activities and a reduction in the availability, capacity and efficiency of municipal and private services necessary to the progress of land development, homebuilding, completing mortgage loans and delivering homes, which in each case has varied by market depending on the scope of the restrictions local authorities have established, these appropriate measures have tempered our sales pace and delayed home deliveries in the latter part of March and through the date of this report. Although we are uncertain of the potential full magnitude or duration of the business and economic impacts from the unprecedented public health effort to contain and combat the spread of COVID-19, which include, among other things, significant volatility in financial markets and a sharp decrease in the value of equity securities, including our common stock, we expect this situation will have a negative impact on our consolidated financial statements in the second quarter and in later periods of 2020 that may be material, but cannot be reasonably estimated at this time.