Builders FirstSource Reports Sales Increase for Second-Quarter 2012 ResultsJuly 23rd, 2012 by DWM Magazine
In reporting its financial results for the second quarter ended June 30, 2012, sales for Builders FirstSource Inc. were $271.9 million compared to $206.4 million last year, an increase of $65.5 million, or 31.7 percent. According to the company, the increase was primarily attributable to increased sales volume.
“We delivered our best operating performance in nearly five years, reporting positive Adjusted EBITDA of $2.1 million for the second quarter, and improving to break-even Adjusted EBITDA June year-to-date,” says Floyd Sherman, Builders FirstSource CEO. “Our second-quarter sales grew 31.7 percent compared to the second quarter of 2011. Over the same time period, actual single-family housing starts in the South Region increased 21.3 percent while single-family units under construction increased 1.5 percent. Our top-line growth far exceeded the increase in residential construction activity, and we met our primary goal for the quarter of getting back to positive EBITDA.”
Sherman adds, “The broad-based housing recovery that began in the latter half of 2011 continues, though moderately paced. At the same time, however, we are seeing meaningful improvements in our financial results as we continue to grow market share, leverage our strong competitive position, and provide first-class customer service.”
Commenting on the second quarter financial results, Chad Crow, Builders FirstSource senior vice president and chief financial officer, adds, “I am extremely pleased with our sales growth and the fact that we achieved positive EBITDA. It was, however, a difficult quarter for gross margins as higher than expected sales volume, combined with roughly 16 percent commodity lumber price inflation, forced us to replace inventory during the latter half of the quarter at higher costs, with limited ability to adjust intra-quarter customer pricing.”
Crow continues, “Our most important goal for the quarter, however, was to get back to positive EBITDA. We achieved our goal by growing sales and generating the incremental gross profit dollars necessary to accomplish this significant financial objective.”
In addition, the company also recorded $0.1 million of facility closure costs during the second quarter of 2012. During the second quarter of 2011, the company recorded $1.9 million of facility closure costs primarily related to the closure of a distribution facility in Georgia.
According to the report, loss from continuing operations was $12.0 million, or $0.13 loss per diluted share, compared to $15.4 million, or $0.16 loss per diluted share in the second quarter of 2011. Excluding the fair value adjustment for stock warrants, facility closure costs and the tax valuation allowance, loss from continuing operations per diluted share was $0.07. For the second quarter of 2011, loss from continuing operations per diluted share was $0.08, when excluding facility closure costs and the tax valuation allowance. Net loss for the second quarter of 2012 was $12.1 million, or $0.13 loss per diluted share, compared to net loss of $15.5 million, or $0.16 loss per diluted share, in the second quarter of 2011.
Adjusted EBITDA was $2.1 million in the second quarter of 2012, compared to a loss of $1.3 million last year.