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BlueLinx Announces Second-Quarter Results

20:00 EDT 12 Aug 2015 | Globe Newswire

- Net Income of $2.9 million -

- Adjusted EBITDA of $9.8 million -

ATLANTA, Aug. 13, 2015 (GLOBE NEWSWIRE) -- BlueLinx Holdings Inc. (NYSE:BXC), a leading distributor of building products in North America, today reported financial results for the second quarter ended July 4, 2015.

Second Quarter Financial Highlights

  • Net income of $2.9 million, or $0.03 per diluted share
  • Adjusted EBITDA of $9.8 million
  • Revenue of $515.7 million
  • Selling, general, and administrative expenses down $4.3 million, or 7.7% compared to second quarter 2014
  • Excess availability of $65.0 million as of July 4, 2015, an increase of $5 million over year-end 2014

“Our team remains focused on outstanding customer service, top line growth, margin and cost efficiency as we execute our operational initiatives. While the second quarter was relatively flat to our second quarter in 2014, we saw improvement in June following a particularly wet April and May, and we strive to keep that momentum going for the remainder of the year," said Mitch Lewis, President and Chief Executive Officer.

Susan O’Farrell, Senior Vice President and Chief Financial Officer added, “We continue to explore refinancing options as we carefully weigh the timing of our refinancing efforts against the pre-payment penalty of our existing mortgage, which is approximately $1.0 million per month until December 2015.”

Second Quarter Results Compared to Prior Year Period
The Company recorded net income of $2.9 million, or $0.03 per diluted share, in the fiscal second quarter 2015 versus net income in the fiscal second quarter 2014 of $3.2 million, or $0.04 per diluted share, which included a $5.0 million gain on the sale of property.

Adjusted EBITDA for the fiscal second quarter 2015 of $9.8 million versus Adjusted EBITDA of $10.6 million for the same period a year ago.

Gross profit in fiscal second quarter 2015 was $60.0 million, versus $62.0 million in fiscal second quarter 2014. Overall, gross margins were impacted by the decline in unit volumes that occurred in fiscal second quarter 2015.

Revenues for the fiscal second quarter ended July 4, 2015, were $515.7 million, compared to $531.5 million in the fiscal second quarter ended July 5, 2014. Overall, revenue was significantly impacted by structural price decreases of 6.5%, which were partially offset by a structural unit volume increase of 0.9%, primarily in the lumber product category.

Liquidity
As of July 4, 2015, the Company had $65.0 million of excess availability under its asset-based revolving credit facilities.

Conference Call
BlueLinx will host a conference call today at 10:00 a.m. Eastern Time, accompanied by a supporting slide presentation. Investors can listen to the conference call and view the accompanying slide presentation by going to the BlueLinx web site, www.BlueLinxCo.com, and selecting the conference link on the Investor Relations page. Investors will be able to access an archived recording of the conference call for one week by calling 404-537-3406, Conference ID# 57441061. The recording will be available two hours after the conference call has concluded. Investors also can access a recording of this call on the BlueLinx website, where a replay of the webcast will be available for 90 days.

Use of Non-GAAP Measures
BlueLinx reports its financial results in accordance with accounting principles generally accepted in the U.S. (“GAAP”). The Company also believes that presentation of certain non-GAAP measures, i.e., results excluding certain charges or other nonrecurring events, when appropriate, provides useful information for the understanding of its ongoing operations and enables investors to focus on period-over-period operating performance, without the impact of significant special items, and thereby enhances the user's overall understanding of the Company's current financial performance relative to past performance and provides a better baseline for modeling future earnings expectations. Any non-GAAP measures used herein are reconciled in the financial tables accompanying this news release. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for, the Company’s reported GAAP results.

Adjusted EBITDA is a non-GAAP measure that management uses to evaluate the performance of the Company. Adjusted EBITDA, as we define it, is an amount equal to net income (loss) plus interest expense and related items, income taxes, stock compensation, depreciation and amortization, further adjusted to exclude other non-cash items and certain other adjustments. Adjusted EBITDA is presented herein because we believe it is a useful supplement to cash flow from operations in understanding cash flows generated from operations that are available for debt service (interest and principal payments) and further investment in acquisitions. However, Adjusted EBITDA is not a presentation made in accordance with GAAP, and is not intended to present a superior measure of the financial condition from those determined under GAAP.

About BlueLinx Holdings Inc.
BlueLinx Holdings Inc., operating through its wholly owned subsidiary BlueLinx Corporation, is a leading distributor of building products in North America.  The Company is headquartered in Atlanta, Georgia and operates its distribution business through its network of 48 distribution centers. BlueLinx is traded on the New York Stock Exchange under the symbol BXC. Additional information about BlueLinx can be found on its website at www.BlueLinxCo.com.

Forward-looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to our ability to return to profitability, and our guidance regarding anticipated financial results. All of these forward-looking statements are based on estimates and assumptions made by our management that, although believed by BlueLinx to be reasonable, are inherently uncertain. Forward-looking statements involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of BlueLinx’ control that may cause its business, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may include, among other things: changes in the prices, supply and/or demand for products that it distributes, general economic and business conditions in the United States; the activities of competitors; changes in significant operating expenses; changes in the availability of capital and interest rates; adverse weather patterns or conditions; acts of cyber intrusion; variations in the performance of the financial markets, including the credit markets; and other factors described in the “Risk Factors” section in the Company’s Annual Report on Form 10-K for the year ended January 3, 2015, and in its periodic reports filed with the Securities and Exchange Commission from time to time. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. BlueLinx undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events, and changes in expectation or otherwise, except as required by law.


BLUELINX HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
 
 Three Months Ended Six Months Ended
 July 4, 2015 July 5, 2014 July 4, 2015 July 5, 2014
Net sales$515,656  $531,494  $970,605  $975,438 
Cost of sales455,673  469,461  860,426  860,729 
Gross profit59,983  62,033  110,179  114,709 
Operating expenses:       
Selling, general, and administrative50,675  54,925  100,711  107,122 
Gains from sales of property  (5,041)   (5,251)
Depreciation and amortization2,438  2,421  4,716  4,773 
Total operating expenses53,113  52,305  105,427  106,644 
Net operating income6,870  9,728  4,752  8,065 
Non-operating (income) expenses:       
Interest expense6,690  6,859  13,243  13,313 
Other (income) expense, net29  (40) 387  120 
Income (loss) before provision for (benefit from) income taxes151  2,909  (8,878) (5,368)
Provision for (benefit from) income taxes(2,719) (327) (2,803) 4 
Net income (loss)$2,870  $3,236  $(6,075) $(5,372)
Weighted average common shares:       
Basic87,399  85,874  87,282  85,531 
Diluted87,862  86,472  87,282  85,531 
Basic and diluted net income (loss) per share applicable to common stock$0.03  $0.04  $(0.07) $(0.06)



BLUELINX HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
 
 July 4, 2015 January 3, 2015
Assets:   
Current assets:   
Cash$2,844  $4,522 
Receivables, net of allowances of $3.6 million and $3.1 million, respectively197,345  144,537 
Inventories, net276,362  242,546 
Other current assets31,680  23,289 
Total current assets508,231  414,894 
Property, plant, and equipment:   
Land and land improvements41,219  41,095 
Buildings90,610  90,161 
Machinery and equipment79,431  77,279 
Construction in progress594  1,188 
Property, plant, and equipment, at cost211,854  209,723 
Accumulated depreciation(107,455) (104,456)
Property, plant, and equipment, net104,399  105,267 
Non-current deferred income tax assets, net501  501 
Other non-current assets10,435  18,320 
Total assets$623,566  $538,982 
Liabilities:   
Current liabilities:   
Accounts payable$115,058  $67,291 
Bank overdrafts11,852  27,280 
Accrued compensation4,316  5,643 
Current maturities of long-term debt203,142  2,679 
Deferred income taxes, net518  518 
Other current liabilities13,772  13,831 
Total current liabilities348,658  117,242 
Non-current liabilities:   
Long-term debt264,113  403,274 
Pension benefit obligation31,956  41,734 
Other non-current liabilities13,394  12,758 
Total liabilities658,121  575,008 
Stockholders’ deficit:   
Common Stock, $0.01 par value, Authorized - 200,000,000 shares; Issued - 89,521,404 and 88,748,638 shares, respectively896  888 
Additional paid-in capital254,380  253,051 
Accumulated other comprehensive loss(28,217) (34,425)
Accumulated stockholders' deficit(261,614) (255,540)
Total stockholders’ deficit(34,555) (36,026)
Total liabilities and stockholders’ deficit$623,566  $538,982 



BLUELINX HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
 
 Six Months
Ended
 Six Months
Ended
  July 4, 2015  July 5, 2014
Cash flows from operating activities:   
Net loss$(6,075) $(5,372)
Adjustments to reconcile net loss to net cash used in operations:   
Depreciation and amortization4,716  4,773 
Amortization of debt discount and issuance costs1,506  1,689 
Gains from sales of property  (5,251)
Severance charges853  1,276 
Intraperiod income tax allocation related to pension plan(1,134) (150)
Pension expense476  450 
Share-based compensation expense1,181  2,873 
Other(643) 232 
Changes in operating assets and liabilities:   
Receivables, net(52,808) (55,209)
Inventories, net(33,816) (44,064)
Accounts payable47,767  39,620 
Restructuring liability(519) (1,597)
Restricted cash related to insurance and other(803) (701)
Prepaid assets(1,650) (7,288)
Accrued compensation and other assets and liabilities(5,298) 390 
Net cash used in operating activities(46,247) (68,329)
Cash flows from investing activities:   
Property, plant, and equipment investments(1,135) (1,253)
Proceeds from sale of assets436  7,213 
Net cash provided by (used in) investing activities(699) 5,960 
Cash flows from financing activities:   
Repurchase of shares to satisfy employee tax withholdings(261) (894)
Repayments on revolving credit facilities(187,394) (216,746)
Borrowings from revolving credit facilities256,647  290,023 
Principal payments on mortgage(8,534) (8,262)
Payments on capital lease obligations(1,614) (1,176)
Increase (decrease) in bank overdrafts(15,428) 3,202 
Decrease (increase) in restricted cash related to the mortgage1,886  (1,019)
Debt financing costs(34)  
Payments on stock offering, less expenses paid  (98)
Net cash provided by financing activities45,268  65,030 
Increase (decrease) in cash(1,678) 2,661 
Cash balance, beginning of period4,522  5,034 
Cash balance, end of period$2,844  $7,695 
Supplemental Cash Flow Information   
Noncash investing and financing transactions:   
Equipment under capital leases$2,029  $1,107 
Debt financing costs$1,252  $201 



BLUELINX HOLDINGS INC.
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP ADJUSTED EBITDA
(In thousands)
(unaudited)
 
 Quarter Ended Six Months Ended
 July 4, 2015 July 5, 2014 July 4, 2015 July 5, 2014
 (Dollars in thousands)
(unaudited)
Net income (loss)$2,870  $3,236  $(6,075) $(5,372)
Adjustments:       
Depreciation and amortization2,438  2,421  4,716  4,773 
Interest expense6,690  6,859  13,243  13,313 
Provision for (benefit from) income taxes(2,719) (327) (2,803) 4 
Gain from the sale of properties  (5,041)   (5,251)
Share-based compensation expense, excluding restructuring519  637  1,135  1,327 
Restructuring, severance, debt fees, and other(36) 2,821  (65) 2,821 
Adjusted EBITDA$9,762  $10,606  $10,151  $11,615 

 

BlueLinx Contacts:
Susan O’Farrell, SVP, Treasurer & CFO
BlueLinx Holdings Inc.
(770) 953-7000

Investor Relations:
Caroline Lowden, Director Finance
(770) 953-7522

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