Bluelinx Holdings Inc. · NYSE:BXC
Bluelinx — Merger or Acquisition (March 2018)
19 slides from Bluelinx's merger presentation, Mar 12, 2018
Slide 1: BlueLinx Holdings to Acquire Cedar Creek Holdings
0 America’s Building Products Distributor March 2018 BlueLinx Holdings to Acquire Cedar Creek Holdings Creating a Leading Building Products Wholesale Distributor
Slide 2: Forward-Looking Statements
1 Forward - Looking Statements This presentation contains “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 19 95, including statements regarding the proposed combination. Forward - looking statements can be identified by such words and phrases as “
Slide 3: Non-GAAP Financial Measures
2 Non - GAAP Financial Measures BlueLinx reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP”) . The Company also believes that presentation of certain non - GAAP measures may be useful to investors . Any non - GAAP measures used here
Slide 4: Today's Presenters
3 Today’s Presenters Mitchell B. Lewis Chief Executive Officer, President & Director Susan C. O’Farrell Chief Financial Officer & Treasurer
Slide 5: An Exciting Opportunity for Shareholders, Customers and Suppliers
4 An Exciting Opportunity for Shareholders, Customers and Suppliers x Comprehensive Product and Services Portfolio Provides Opportunity for Accelerated Growth ▪ Enhanced combined company product portfolio by providing greater breadth and depth of building products and services for customers and supp
Slide 6: Transaction Overview
5 Transaction Overview Purchase Price ▪ $413 million purchase price o $345 million cash and $68 million as the agreed value of capital leases Cost Savings ▪ At least $50 million of annual run - rate cost savings expected to be achieved within 18 months Combined Financial Metrics ▪ $3.2 billion of co
Slide 7: Attractive Transaction Economics
6 6.9x 3.8x Cedar Creek Standalone Cedar Creek Pro-Forma 2017 NET INCOME AND ADJUSTED EBITDA Attractive Transaction Economics BlueLinx enters into strategic merger agreement to acquire Cedar Creek for $413 million Attractive Purchase Multiple Driving Cash Flow Growth and EPS Accretion PURCHASE MULTI
Slide 8: Overview of Cedar Creek
7 Overview of Cedar Creek COMPANY OVERVIEW Cedar Creek is a differentiated distributor with a proven growth and expansion strategy ▪ One of the leading wholesale building products distribution companies in the U.S. ▪ Operates 31 locations to service five customer groups – local lumber yards, pro dea
Slide 9: A Complementary Combination Poised for Growth
8 A Complementary Combination Poised for Growth OPERATIONS NATIONAL FOOTPRINT SERVICES 31 locations Headquarters in Oklahoma City, OK 11 wood manufacturing, 6 moulding , 6 timber and 2 prefinished siding facilities $1.42 billion sales ~1,300 associates 39 locations Headquarters in Atla
Slide 10: Longstanding and deep customer relationships
9 ▪ Longstanding and deep customer relationships o Customers include household names with the national reach and financial stability to gain market share in a housing market rebound o Long - term relationships with top customers, averaging 20+ years ▪ No single customer represents more than ~5% of s
Slide 11: Comprehensive Product and Service Offering
10 Comprehensive Product and Service Offering ▪ A combination of structural and specialty products are utilized in every home construction o BlueLinx will offer a variety of branded and private - label products encompassing 50,000 SKUs PRODUCT DETAIL The combined company’s product suite provides a c
Slide 12: Accelerating Market Demand Drivers Creates a Long Runway for Ongoing Value Creation
11 0.0 0.5 1.0 1.5 2.0 1995A 1996A 1997A 1998A 1999A 2000A 2001A 2002A 2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018E 2019E 2020E Accelerating Market Demand Drivers Creates a Long Runway for Ongoing Value Creation REPAIR & REMODELING SPENDING RESIDENT
Slide 13: Significant Cost Savings Potential
12 Significant Cost Savings Potential Expense Category 2017 Pro - Forma Combined Opportunity ($ in millions) Illustrative Savings Opportunities G & A Expense $ 200M ▪ Professional services ▪ General maintenance and supply ▪ Marketing, travel & entertainment ▪ Employee benefit harmonization ▪ Insuran
Slide 14: Significant Cost Savings Potential (Cont'd)
13 Significant Cost Savings Potential (Cont’d) ESTIMATED RUN RATE COST SAVINGS COMMENTARY The combined company will offer potential for significant cost savings to realize improved margins ESTIMATED $50M COST SAVINGS BY OPPORTUNITY Significant identifiable and achievable cost savings of at least $
Slide 15: Highly Attractive Combined Financial Profile
14 $44M $60M $154M Highly Attractive Combined Financial Profile 2017 REVENUE The combined company will offer potential for significant cost savings to realize improved margins Expected Run - Rate Cost Savings: ~$50M 2.4% 4.1% 4.8% Note: Cedar Creek results unaudited for 2017; 2017 BlueLinx audited F
Slide 16: Cash Flow Generation Supports Deleveraging
15 6.4x ~4.0x BXC 2017 YE Pro-Forma Q1 2018 Projected Q4 2019 Cash Flow Generation Supports Deleveraging Leverage Pro - Forma total funded debt of ~$580 million at close 1 o ~$400M drawn at close (estimated cost of L + 225bps) o $180M First Lien Term Loan (estimated cost of L + 700bps with 1.0% LI
Slide 17: Compelling Transaction for BlueLinx Shareholders
16 • Enhances geographic presence and creates a leading building products wholesale distributor East of the Rockies with over 700 customer facing sales associates • Comprehensive product and services portfolio provides opportunity for accelerated growth • Diversified and established customer base wi
Slide 18: Appendix
17 America’s Building Products Distributor Appendix
Slide 19: Reconciliation of GAAP to Adjusted Measures
18 Reconciliation of GAAP to Adjusted Measures 2017 Adjusted EBITDA Reconciliation BlueLinx Cedar Creek (unaudited) Combined Net income (loss) $63 $18 $81 Adjustments: Depreciation and amortization 9 17 26 Interest expense 21 10 31 Provision for (benefit from) income taxes (53) 12 (41) Other 4 3 7 A
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