BlueLinx Holdings Inc. (NYSE: BXC), a leading U.S. wholesale
distributor of building products, today reported financial results
for the three months ended June 29, 2024.
SECOND QUARTER 2024 HIGHLIGHTS
- Net sales of $768 million
- Gross profit of $122 million, gross margin of 15.9% and
specialty product gross margin of 19.3%
- Net income of $14 million, or $1.65 diluted earnings per
share
- Adjusted net income of $15 million, or $1.68 adjusted diluted
earnings per share
- Adjusted EBITDA of $34 million, 4.5% of net sales
- Operating cash flow of $36 million and free cash flow of $29
million
- Available liquidity of $838 million, including $491 million
cash and cash equivalents on hand
- $15 million in share repurchases, with $76 million remaining on
our share repurchase authorization as of quarter-end
“Our second quarter results were highlighted by solid volume
growth in several of our key specialty product categories despite a
challenging macro environment,” said Shyam Reddy, President and CEO
of BlueLinx. “We also generated solid specialty product gross
margins of approximately 19%, despite the effects of price
deflation. The quarter was adversely impacted by structural
products, primarily driven by declining lumber and panel prices, in
addition to volume declines due to challenges in the housing and
building products sector. Although current market conditions are
challenging, we believe we are well-positioned for long-term
success because our vision is supported by a well-defined sales
growth strategy, strong liquidity, and minimal debt.”
“Our strong free cash flow generation of $29 million during the
second quarter helped us end the period with $491 million in cash
on hand and a net leverage ratio of (0.9x),” said Andy Wamser,
Chief Financial Officer of BlueLinx. “During the second quarter, we
purchased $15 million of stock under our share repurchase program,
demonstrating our commitment to returning capital to shareholders.
At the end of the quarter, we had $76 million remaining on our
share repurchase authorization, and we will continue to be
opportunistic in the market.”
SECOND QUARTER 2024 FINANCIAL PERFORMANCE
In the second quarter of 2024, net sales were $768 million, a
decrease of $48 million, or 6% when compared to the second quarter
of 2023. Gross profit was $122 million, a decrease of $13 million,
or 10%, year-over-year, and gross margin was 15.9%, down 70 basis
points from the same period last year.
Net sales of specialty products, which includes products such as
engineered wood, siding, millwork, outdoor living, specialty lumber
and panels, and industrial products, were $539 million, a decrease
of $32 million, or 5.5% when compared to the second quarter of
2023. This decrease was due to price deflation across specialty
products, partially offset by a slight increase in volumes. Gross
profit from specialty product sales was $104 million, a decrease of
$4 million, or 4.1% when compared to the second quarter of last
year. Gross margin was 19.3% compared to 19.1% in the prior year
period. The current period benefited from the reduction of an
accrued estimate made in the first quarter of 2024 related to
amounts the Company believes it may owe for discrepancies in duties
paid in prior years for certain imported goods. Not including this
benefit, specialty products’ gross margin would have been 18.9% in
the current quarter.
Net sales of structural products, which includes products such
as lumber, plywood, oriented strand board, rebar, and remesh,
decreased $16 million, or 6.6% when compared to the second quarter
of 2023, to $229 million in the second quarter of 2024. The
decrease in structural sales was due primarily to lower volumes and
a decline in our lumber selling prices which generally correlated
to a year-over-year decline in the average composite price of
framing lumber of 6%. Gross profit from sales of structural
products was $18 million, a decrease of $9 million from the prior
year period, and gross margin was 7.9%, compared to 11.0% in the
prior year period.
Selling, general and administrative (“SG&A”) expenses were
$89 million in the second quarter of 2024, $1 million higher than
the prior year period. The year-over-year change in SG&A was
primarily due to higher technology expenses and legal expenses
associated with duty-related matters, as well as lower logistics
costs and share-based compensation expenses.
Net income was $14 million, or $1.65 per diluted share, versus
$24 million, or $2.70 per diluted share, in the prior year period.
Adjusted Net Income was $15 million, or $1.68 per diluted share
compared to $26 million, or $2.91 per diluted share in the second
quarter of last year.
Adjusted EBITDA was $34 million, or 4.5% of net sales, for the
second quarter of 2024, compared to $49 million, or 6.0% of net
sales in the second quarter of 2023. The current period includes
the benefit of the duty-related matters, and not including these
items, Adjusted EBITDA was $32 million, or 4.1% of net sales.
Net cash generated from operating activities was $36 million in
the second quarter of 2024 and free cash flow was $29 million. The
cash generated during the second quarter was driven by net income
and improved working capital.
CAPITAL ALLOCATION AND FINANCIAL POSITION
During the second quarter, we invested $6.5 million of cash in
capital investments used to improve our distribution facilities and
upgrade our fleet. Additionally, we purchased approximately $15
million of the Company’s common stock through open market
transactions under our $100 million share repurchase program. At
quarter-end, we had $76 million remaining under this authorization
and we plan to continue being opportunistic in the market when
repurchasing shares.
As of June 29, 2024, total debt and finance lease obligations,
but excluding real property finance lease obligations, was $348
million, which consisted of $300 million of senior secured notes
that mature in 2029 and $48 million of finance lease obligations
for equipment. Net debt was ($143) million, which consisted of
total debt and finance leases excluding real property finance lease
obligations of $348 million less cash and cash equivalents of $491
million, resulting in a net leverage ratio of (0.9x) using a
trailing twelve-month Adjusted EBITDA of $160 million. Available
liquidity was $838 million which included an undrawn revolving
credit facility that had $346 million of availability plus cash and
cash equivalents of $491 million.
THIRD QUARTER 2024 OUTLOOK
Through the first four weeks of the third quarter of 2024,
specialty product gross margin was in the range of 18% to 19% and
structural product gross margin was in the range of 8% to 9%.
Average daily sales volumes were improved versus the second quarter
of 2024.
CONFERENCE CALL INFORMATION
BlueLinx will host a conference call on July 31, 2024, at 10:00
a.m. Eastern Time, accompanied by a supporting slide
presentation.
A webcast of the conference call and accompanying presentation
materials will be available in the Investor Relations section of
the BlueLinx website at https://investors.bluelinxco.com, and a
replay of the webcast will be available at the same site shortly
after the webcast is complete.
To participate in the live teleconference:
Domestic Live: 1-888-660-6392 Passcode: 9140086
To listen to a replay of the teleconference, which will be
available through August 14, 2024:
Domestic Replay: 1-800-770-2030 Passcode: 9140086
ABOUT BLUELINX
BlueLinx (NYSE: BXC) is a leading U.S. wholesale distributor of
residential and commercial building products with both branded and
private-label SKUs across product categories such as lumber,
panels, engineered wood, siding, millwork, and industrial products.
With a strong market position, broad geographic coverage footprint
servicing 50 states, and the strength of a locally focused sales
force, we distribute a comprehensive range of products to our
customers which include national home centers, pro dealers,
cooperatives, specialty distributors, regional and local dealers
and industrial manufacturers. BlueLinx provides a wide range of
value-added services and solutions to our customers and suppliers,
and we operate our business through a broad network of distribution
centers. To learn more about BlueLinx, please visit
www.bluelinxco.com.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements.
Forward-looking statements include, without limitation, any
statement that predicts, forecasts, indicates or implies future
results, performance, liquidity levels or achievements, and may
contain the words “believe,” “anticipate,” “could,” “expect,”
“estimate,” “intend,” “may,” “project,” “plan,” “should,” “will,”
“will be,” “will likely continue,” “will likely result,” “would,”
or words or phrases of similar meaning.
The forward-looking statements in this press release include
statements about our strategy, liquidity, and debt, our long-run
positioning relative to industry conditions, future share
repurchases, and the information set forth under the heading “Third
Quarter 2024 Outlook”.
Forward-looking statements in this press release are based on
estimates and assumptions made by our management that, although
believed by us to be reasonable, are inherently uncertain.
Forward-looking statements involve risks and uncertainties that may
cause our business, strategy, or actual results to differ
materially from the forward-looking statements. These risks and
uncertainties include those discussed in greater detail in our
filings with the Securities and Exchange Commission. We operate in
a changing environment in which new risks can emerge from time to
time. It is not possible for management to predict all of these
risks, nor can it assess the extent to which any factor, or a
combination of factors, may cause our business, strategy, or actual
results to differ materially from those contained in
forward-looking statements. Factors that may cause these
differences include, among other things: housing market conditions;
pricing and product cost variability; volumes of product sold;
competition; the cyclical nature of the industry in which we
operate; consolidation among competitors, suppliers, and customers;
disintermediation risk; loss of products or key suppliers and
manufacturers; our dependence on international suppliers and
manufacturers for certain products; effective inventory management
relative to our sales volume or the prices of the products we
produce; business disruptions; potential acquisitions and the
integration and completion of such acquisitions; information
technology security risks and business interruption risks; the
ability to attract, train, and retain highly qualified associates
and other key personnel while controlling related labor costs;
exposure to product liability and other claims and legal
proceedings related to our business and the products we distribute;
natural disasters, catastrophes, fire, wars or other unexpected
events; the impacts of climate change; successful implementation of
our strategy; wage increases or work stoppages by our union
employees; costs imposed by federal, state, local, and other
regulations; compliance costs associated with federal, state, and
local environmental protection laws; the effects of epidemics,
global pandemics or other widespread public health crises and
governmental rules and regulations; fluctuations in our operating
results; our level of indebtedness and our ability to incur
additional debt to fund future needs; the covenants of the
instruments governing our indebtedness limiting the discretion of
our management in operating the business; the potential to incur
more debt; the fact that we have consummated certain sale leaseback
transactions with resulting long-term non-cancelable leases, many
of which are or will be finance leases; the fact that we lease many
of our distribution centers, and we would still be obligated under
these leases even if we close a leased distribution center;
inability to raise funds necessary to finance a required repurchase
of our senior secured notes; a lowering or withdrawal of debt
ratings; changes in our product mix; increases in fuel and other
energy prices or availability of third-part freight providers;
changes in insurance-related deductible/retention reserves based on
actual loss development experience; the possibility that the value
of our deferred tax assets could become impaired; changes in our
expected annual effective tax rate could be volatile; the costs and
liabilities related to our participation in multi-employer pension
plans could increase; the risk that our cash flows and capital
resources may be insufficient to service our existing or future
indebtedness; interest rate risk, which could cause our debt
service obligations to increase; and changes in, or interpretation
of, accounting principles.
Given these risks and uncertainties, we caution you not to place
undue reliance on forward-looking statements. We expressly disclaim
any obligation to update or revise any forward-looking statement as
a result of new information, future events or otherwise, except as
required by law.
NON-GAAP MEASURES AND SUPPLEMENTAL FINANCIAL
INFORMATION
The Company reports its financial results in accordance with
GAAP. The Company also believes that presentation of certain
non-GAAP measures may be useful to investors and may provide a more
complete understanding of the factors and trends affecting the
business than using reported GAAP results alone. Any non-GAAP
measures used herein are reconciled to their most directly
comparable GAAP measures herein in the “Reconciliation of Non-GAAP
Measurements” table later in this release. The Company cautions
that non-GAAP measures are not intended to present superior
measures of our financial condition from those measures determined
under GAAP and should be considered in addition to, but not as a
substitute for, the Company’s reported GAAP results. The Company
further cautions that its non-GAAP measures, as used herein, are
not necessarily comparable to other similarly titled measures of
other companies due to differences in methods of calculation.
Adjusted EBITDA and Adjusted EBITDA Margin. BlueLinx defines
Adjusted EBITDA as an amount equal to net income (loss) plus
interest expense and all interest expense related items, income
taxes, depreciation and amortization, and further adjusted for
certain non-cash items and other special items, including
compensation expense from share based compensation, one-time
charges associated with the legal, consulting, and professional
fees related to our merger and acquisition activities, gains or
losses on sales of properties, amortization of deferred gains on
real estate, and expense associated with our restructuring
activities, such as severance, in addition to other significant
and/or one-time, nonrecurring, non-operating items.
The Company presents Adjusted EBITDA because it is a primary
measure used by management to evaluate operating performance.
Management believes this metric helps to enhance investors’ overall
understanding of the financial performance and cash flows of the
business. Management also believes Adjusted EBITDA is helpful in
highlighting operating trends. Adjusted EBITDA is frequently used
by securities analysts, investors, and other interested parties in
their evaluation of companies, many of which present an Adjusted
EBITDA measure when reporting their results.
We determine our Adjusted EBITDA Margin, which we sometimes
refer to as our Adjusted EBITDA as a percentage of net sales, by
dividing our Adjusted EBITDA for the applicable period by our net
sales for the applicable period. We believe that this ratio is
useful to investors because it more clearly defines the quality of
earnings and operational efficiency of translating sales to
profitability.
Adjusted Net Income and Adjusted Earnings Per Share. BlueLinx
defines Adjusted Net Income as Net Income adjusted for certain
non-cash items and other special items, including compensation
expense from share based compensation, one-time charges associated
with the legal, consulting, and professional fees related to our
merger and acquisition activities, gains or losses on sales of
properties, amortization of deferred gains on real estate, and
expense associated with our restructuring activities, such as
severance, in addition to other significant and/or one-time,
nonrecurring, non-operating items, further adjusted for the tax
impacts of such reconciling items. BlueLinx defines Adjusted
Earnings Per Share (basic and/or diluted) as the Adjusted Net
Income for the period divided by the weighted average outstanding
shares (basic and/or diluted) for the periods presented. We believe
that Adjusted Net Income and Adjusted Earnings Per Share (basic
and/or diluted) are useful to investors to enhance investors’
overall understanding of the financial performance of the business.
Management also believes Adjusted Net Income and Adjusted Earnings
Per Share (basic and/or diluted) are helpful in highlighting
operating trends.
Our Adjusted Net Income and Adjusted Earnings Per Share (basic
and/or diluted) are not presentations made in accordance with GAAP
and are not intended to present superior measures of our financial
condition from those measures determined under GAAP. Adjusted Net
Income and Adjusted Earnings Per Share (basic or diluted), as used
herein, are not necessarily comparable to other similarly titled
captions of other companies due to differences in methods of
calculation. These non-GAAP measures are reconciled in the
“Reconciliation of Non-GAAP Measurements” table later in this
release.
Free Cash Flow. BlueLinx defines free cash flow as net cash
provided by operating activities less total capital expenditures.
Free cash flow is a measure used by management to assess our
financial performance, and we believe it is useful for investors
because it relates the operating cash flow of the Company to the
capital that is spent to continue and improve business operations.
In particular, free cash flow indicates the amount of cash
generated after capital expenditures that can be used for, among
other things, investment in our business, strengthening our balance
sheet, and repayment of our debt obligations. Free cash flow does
not represent the residual cash flow available for discretionary
expenditures since there may be other nondiscretionary expenditures
that are not deducted from the measure. Free cash flow is not a
presentation made in accordance with GAAP and is not intended to
present a superior measure of financial condition from those
determined under GAAP. Free cash flow, as used herein, is not
necessarily comparable to other similarly titled captions of other
companies due to differences in methods of calculation. This
non-GAAP measure is reconciled in the “Reconciliation of Non-GAAP
Measurements” table later in this release.
Net Debt, Net Debt Excluding Real Property Finance Lease
Liabilities, Overall Net Leverage Ratio, and Net Leverage Ratio
Excluding Real Property Finance Lease Liabilities. BlueLinx
calculates Net Debt as its total short- and long-term debt,
including outstanding balances under our term loan and revolving
credit facility and the total amount of its obligations under
finance leases, less cash and cash equivalents. Net Debt Excluding
Real Property Finance Lease Liabilities is calculated in the same
manner as Net Debt, except the total amount of obligations under
real estate finance leases are excluded. Although our credit
agreements do not contain leverage covenants, a net leverage ratio
excluding finance lease obligations for real property is included
within the terms of our revolving credit agreement. We believe that
Net Debt and Net Debt Excluding Real Property Finance Lease
Liabilities are useful to investors because our management reviews
both metrics as part of its management of overall liquidity,
financial flexibility, capital structure and leverage, and
creditors and credit analysts monitor our net debt as part of their
assessments of our business. We determine our Overall Net Leverage
Ratio by dividing our Net Debt by Twelve-Month Trailing Adjusted
EBITDA. Our calculation of Net Leverage Ratio Excluding Real
Property Finance Lease Liabilities is determined by dividing our
Net Debt Excluding Real Property Finance Lease Liabilities by
Twelve-Month Trailing Adjusted EBITDA. We believe that these ratios
are useful to investors because they are indicators of our ability
to meet our future financial obligations. In addition, our Net
Leverage Ratio is a measure that is frequently used by investors
and creditors. Our Net Debt, Net Debt Excluding Real Property
Finance Lease Liabilities, Overall Net Leverage Ratio, and Net
Leverage Ratio Excluding Real Property Finance Lease Liabilities
are not made in accordance with GAAP and are not intended to
present a superior measure of our financial condition from measures
and ratios determined under GAAP. The calculations of our Net Debt,
Net Debt Excluding Real Property Finance Lease Liabilities, Overall
Net Leverage Ratio, and Net Leverage Ratio Excluding Real Property
Finance Lease Liabilities are presented in the table on page 8. Net
Debt, Net Debt Excluding Real Property Finance Lease Liabilities,
Overall Net Leverage Ratio, and Net Leverage Ratio Excluding Real
Property Finance Lease Liabilities, as used herein, are not
necessarily comparable to other similarly titled captions of other
companies due to differences in methods of calculation.
BLUELINX HOLDINGS INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
Six Months Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(In thousands, except per share
data)
Net sales
$
768,363
$
815,967
$
1,494,607
$
1,613,871
Cost of products sold
645,919
680,164
1,244,482
1,344,529
Gross profit
122,444
135,803
250,125
269,342
Gross margin
15.9
%
16.6
%
16.7
%
16.7
%
Operating expenses (income):
Selling, general, and administrative
89,453
88,750
180,703
179,924
Depreciation and amortization
10,120
7,951
19,553
15,669
Amortization of deferred gains on real
estate
(984
)
(984
)
(1,968
)
(1,968
)
Other operating expenses
8
993
322
4,109
Total operating expenses
98,597
96,710
198,610
197,734
Operating income
23,847
39,093
51,515
71,608
Non-operating expenses:
Interest expense, net
4,801
6,311
9,425
13,998
Other expense, net
—
594
—
1,188
Income before provision for income
taxes
19,046
32,188
42,090
56,422
Provision for income taxes
4,710
7,722
10,262
14,144
Net income
$
14,336
$
24,466
$
31,828
$
42,278
Basic earnings per share
$
1.65
$
2.70
$
3.68
$
4.67
Diluted earnings per share
$
1.65
$
2.70
$
3.66
$
4.67
BLUELINX HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Unaudited)
June 29, 2024
December 30, 2023
(In thousands, except share
data)
ASSETS
Current assets:
Cash and cash equivalents
$
491,392
$
521,743
Receivables, less allowances of $3,344 and
$3,398, respectively
273,537
228,410
Inventories, net
357,573
343,638
Other current assets
36,220
26,608
Total current assets
1,158,722
1,120,399
Property and equipment, at cost
413,905
396,321
Accumulated depreciation
(181,841
)
(170,334
)
Property and equipment, net
232,064
225,987
Operating lease right-of-use assets
44,418
37,227
Goodwill
55,372
55,372
Intangible assets, net
28,787
30,792
Deferred income tax asset, net
53,677
53,256
Other non-current assets
13,036
14,568
Total assets
$
1,586,076
$
1,537,601
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
179,375
$
157,931
Accrued compensation
12,310
14,273
Finance lease liabilities - current
11,132
11,178
Operating lease liabilities - current
8,460
6,284
Real estate deferred gains - current
3,935
3,935
Other current liabilities
22,250
24,961
Total current liabilities
237,462
218,562
Long-term debt
294,403
293,743
Finance lease liabilities, less current
portion
280,206
274,248
Operating lease liabilities, less current
portion
37,369
32,519
Real estate deferred gains, less current
portion
64,697
66,599
Other non-current liabilities
19,607
17,644
Total liabilities
933,744
903,315
Commitments and contingencies
STOCKHOLDERS' EQUITY:
Preferred Stock, $0.01 par value,
30,000,000 shares authorized, none outstanding
—
—
Common Stock, $0.01 par value, 20,000,000
shares authorized,
8,551,462 and 8,650,046 outstanding,
respectively
86
87
Additional paid-in capital
151,279
165,060
Retained earnings
500,967
469,139
Total stockholders’ equity
652,332
634,286
Total liabilities and stockholders’
equity
$
1,586,076
$
1,537,601
BLUELINX HOLDINGS INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
Six Months Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(In thousands)
Cash flows from operating
activities:
Net income
$
14,336
$
24,466
$
31,828
$
42,278
Adjustments to reconcile net income to
cash provided by operations:
Depreciation and amortization
10,120
7,951
19,553
15,669
Amortization of debt discount and issuance
costs
330
330
660
659
Provision for deferred income taxes
(48
)
337
(421
)
550
Amortization of deferred gains from real
estate
(984
)
(984
)
(1,968
)
(1,968
)
Share-based compensation
1,405
1,926
3,755
6,495
Changes in operating assets and
liabilities:
Accounts receivable
14,707
4,547
(45,127
)
(42,786
)
Inventories
13,369
30,012
(13,935
)
105,001
Accounts payable
6,339
13,084
20,123
38,504
Other current assets
(4,055
)
(15,995
)
(9,612
)
(3,169
)
Other assets and liabilities
(19,716
)
(1,521
)
(188
)
(8,115
)
Net cash provided by operating
activities
35,803
64,153
4,668
153,118
Cash flows from investing
activities:
Proceeds from sale of assets
147
91
274
128
Property and equipment investments
(6,454
)
(5,031
)
(11,901
)
(14,039
)
Net cash used in investing activities
(6,307
)
(4,940
)
(11,627
)
(13,911
)
Cash flows from financing
activities:
Common stock repurchase and retirement
(14,529
)
(11,599
)
(14,529
)
(11,599
)
Repurchase of shares to satisfy employee
tax withholdings
(1,545
)
(3,390
)
(2,452
)
(3,960
)
Principal payments on finance lease
liabilities
(3,339
)
(2,133
)
(6,411
)
(4,266
)
Net cash used in financing activities
(19,413
)
(17,122
)
(23,392
)
(19,825
)
Net change in cash and cash
equivalents
10,083
42,091
(30,351
)
119,382
Cash and cash equivalents at beginning of
period
481,309
376,234
521,743
298,943
Cash and cash equivalents at end of
period
$
491,392
$
418,325
$
491,392
$
418,325
The following schedule presents our
revenues disaggregated by specialty and structural product
category:
Three Months Ended
Six Months Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(Dollar amounts in thousands)
Net sales by product category
Specialty products
$
539,466
$
570,990
$
1,043,300
$
1,138,828
Structural products
228,897
244,977
451,307
475,043
Total net sales
$
768,363
$
815,967
$
1,494,607
$
1,613,871
Gross profit by product category
Specialty products
$
104,350
$
108,841
$
208,399
$
215,468
Structural products
18,094
26,962
41,726
53,874
Total gross profit
$
122,444
$
135,803
$
250,125
$
269,342
Gross margin % by product category
Specialty products
19.3
%
19.1
%
20.0
%
18.9
%
Structural products
7.9
%
11.0
%
9.2
%
11.3
%
Company gross margin %
15.9
%
16.6
%
16.7
%
16.7
%
BLUELINX HOLDINGS INC.
RECONCILIATION OF NON-GAAP
MEASUREMENTS
(Unaudited)
The following schedule reconciles net
income to Adjusted EBITDA (non-GAAP):
Three Months Ended
Six Months Ended
Trailing Twelve Months
Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(In thousands)
Net income
$
14,336
$
24,466
$
31,828
$
42,278
$
38,086
$
133,773
Adjustments:
Depreciation and amortization
10,120
7,951
19,553
15,669
35,927
30,018
Interest expense, net
4,801
6,311
9,425
13,998
19,173
33,722
Provision for income taxes
4,710
7,722
10,262
14,144
29,468
44,019
Share-based compensation expense
1,405
1,926
3,755
6,495
9,315
12,175
Amortization of deferred gains on real
estate
(984
)
(984
)
(1,968
)
(1,968
)
(3,934
)
(3,934
)
Pension termination and related
expenses(1)(2)
—
594
—
1,188
31,628
1,188
Acquisition-related costs(1)(3)(5)
—
—
—
17
261
1,272
Restructuring and other(1)(4)(5)
7
993
321
4,092
143
6,930
Adjusted EBITDA
$
34,395
$
48,979
$
73,176
$
95,913
$
160,067
$
259,163
(1)
Reflects non-recurring items of
approximately $1.6 million in beneficial items in the prior
quarterly period. For the current year six-month period, reflects
non-recurring, beneficial items of approximately $0.3 million and
the prior year six-month period reflects $5.3 million of
non-recurring, beneficial items. For the trailing twelve months
ended, reflects approximately $32.0 million of non-recurring,
beneficial items, and approximately $9.4 million of non-recurring,
beneficial items, in the prior trailing twelve- month period.
(2)
Reflects expenses related to our
previously disclosed settlement of the BlueLinx Corporation Hourly
Retirement Plan (defined benefit) in 4Q 2023.
(3)
Reflects primarily legal,
professional, technology and other integration costs.
(4)
Reflects costs related to our
restructuring efforts, such as severance, net of other one-time
non-operating items.
(5)
Certain amounts for prior periods
in fiscal 2023 have been reclassified for Acquisition-related costs
and Restructuring and other.
The following tables reconciles Net income
and Diluted earnings per share to Adjusted net income (non-GAAP)
and Adjusted diluted earnings per share (non-GAAP):
Three Months Ended
Six Months Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(In thousands, except per share
data)
Net income
$
14,336
$
24,466
$
31,828
$
42,278
Adjustments:
Share-based compensation expense
1,405
1,926
3,755
6,495
Amortization of deferred gains on real
estate
(984
)
(984
)
(1,968
)
(1,968
)
Pension termination and related
expenses
—
594
—
1,188
Acquisition-related costs (2)
—
—
—
17
Restructuring and other (2)
7
993
321
4,092
Tax impacts of reconciling items above
(1)
(106
)
(607
)
(514
)
(2,463
)
Adjusted net income
$
14,658
$
26,388
$
33,422
$
49,639
Basic EPS
$
1.65
$
2.70
$
3.68
$
4.67
Diluted EPS
$
1.65
$
2.70
$
3.66
$
4.67
Weighted average shares outstanding -
Basic
8,645
9,040
8,641
9,034
Weighted average shares outstanding -
Diluted
8,686
9,057
8,680
9,051
Non-GAAP Adjusted Basic EPS
$
1.69
$
2.92
$
3.86
$
5.48
Non-GAAP Adjusted Diluted EPS
$
1.68
$
2.91
$
3.85
$
5.48
(1)
Tax impact calculated based on
the effective tax rate for the respective three and six-month
periods presented
(2)
Certain amounts for prior periods
in fiscal 2023 have been reclassified for Acquisition-related costs
and Restructuring and other
In the following table, our Adjusted
EBITDA margin (non-GAAP) is calculated and compared to Net income
as a percentage of Net sales:
Three Months Ended
Six Months Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(Dollar amounts in thousands)
Net sales
$
768,363
$
815,967
$
1,494,607
$
1,613,871
Net income
$
14,336
$
24,466
$
31,828
$
42,278
Net income as a percentage of Net
sales
1.9
%
3.0
%
2.1
%
2.6
%
Net sales
$
768,363
$
815,967
$
1,494,607
$
1,613,871
Adjusted EBITDA - non-GAAP(1)
$
34,395
$
48,979
$
73,176
$
95,913
Adjusted EBITDA margin - non-GAAP
4.5
%
6.0
%
4.9
%
5.9
%
(1)
See the table that reconciles Net
income to Adjusted EBITDA (non-GAAP)
The following schedule reconciles Total
debt and finance leases to: Net debt (non-GAAP) and to Net debt
excluding finance lease liabilities for real property (non-GAAP).
The calculations of Net leverage ratio (non-GAAP) and Net leverage
ratio excluding real property finance leases liabilities (non-GAAP)
is also presented.
As of
June 29, 2024
December 30, 2023
July 1, 2023
($ amounts in thousands)
Long term debt(1)
$
300,000
$
300,000
$
300,000
Finance lease liabilities for equipment
and vehicles
47,979
42,252
27,743
Finance lease liabilities for real
property
243,359
243,174
243,445
Total debt and finance leases
591,338
585,426
571,188
Less: available cash and cash
equivalents
491,392
521,743
418,325
Net debt (non-GAAP)
$
99,946
$
63,683
$
152,863
Net debt, excluding finance lease
liabilities for real property (non-GAAP)
$
(143,413
)
$
(179,491
)
$
(90,582
)
Trailing twelve-month adjusted EBITDA
(non-GAAP, see above reconciliation)
$
160,067
$
182,804
$
259,163
Net leverage ratio
0.6x
0.3x
0.6x
Net leverage ratio excluding real
property finance lease liabilities(2)
(0.9x
)
(1.0x
)
(0.3x
)
(1)
As of June 29, 2024, December 30,
2023, and July 1, 2023, our long-term debt is comprised of $300
million of senior-secured notes issued in October 2021. These notes
are presented under the long-term debt caption of our condensed
consolidated balance sheets at $294.4 million, $293.7 million, and
$293.1 million as of June 29, 2024, December 30, 2023, and July 1,
2023, respectively. This presentation is net of their unamortized
issuance costs and discount. Our senior secured notes are presented
in this table at their face value for the purposes of calculating
our net leverage ratio.
(2)
Net leverage ratio excluding finance lease
obligations for real property is included within the terms of our
revolving credit agreement.
The following schedule reconciles Net cash
provided by operating activities to Free cash flow (non-GAAP):
Three Months Ended
Six Months Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
(In thousands)
Net cash provided by operating
activities
$
35,803
$
64,153
$
4,668
$
153,118
Less: Property and equipment
investments
(6,454
)
(5,031
)
(11,901
)
(14,039
)
Free cash flow - non-GAAP
$
29,349
$
59,122
$
(7,233
)
$
139,079
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240730081639/en/
Tom Morabito Investor Relations Officer (470) 394-0099
investor@bluelinxco.com
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