Bluelinx Holdings Inc. · NYSE:BXC
Bluelinx — Q3 2023 Earnings Presentation
27 slides from Bluelinx's earnings presentation, Nov 1, 2023
Slide 1: BlueLinx Q3 2023 Results
BlueLinx Q3 2023 Results Delivering What Matters November 1, 2023 © BlueLinx 2023. All Rights Reserved. 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation 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,” “antic
Slide 3: Opening Remarks
Opening Remarks Shyam Reddy President & CEO 3
Slide 4: BlueLinx Strategic Priorities
BLUELINX STRATEGIC PRIORITIES Grow Specialty Business Capital Categories Excellence Allocation ▪ Engineered Wood ▪ Leverage our Scale/Nationwide ▪ Maintain Strong Balance Sheet Footprint ▪ Siding ▪ Reinvest in the business ▪ Customer/Supplier Partnerships ▪ Industrial Products ▪ Disciplined M&A and
Slide 5: Third Quarter 2023 Results
THIRD QUARTER 2023 RESULTS Explosive profitable growth with a highly engaged team ▪ Net sales of $810M, down 24% year-over-year Q3 23 Sales by Product Category ❑ Prior year included benefit from elevated demand and higher commodity prices ▪ Gross profit of $139M, down 26% year-over-year ❑ 17.2% of n
Slide 6: U.S. Housing Industry
U.S. HOUSING INDUSTRY ▪ Home affordability under pressure BLUELINX SALES BY END MARKET ❑ Mortgage rates remain at multi-year highs ❑ Home price appreciation ❑ Broad-based inflation ▪ New home starts down year-over-year New Home ❑ Single-family housing starts are down year-over-year through the first
Slide 7: Financial Review
Financial Review Andy Wamser Chief Financial Officer 7
Slide 8: Third Quarter 2023 Results
THIRD QUARTER 2023 RESULTS $ millions, except per share data Q3 Q3 2023 vs. Q3 Q3 Q3 Q3 Commentary 2023 Q3 2022 2022 2021 2020 Net Sales $810 (24%) $1,061 $971 $871 ▪ Net Sales decreased 24% to $810M Gross Profit $139 (26%) $189 $153 $159 ❑ Specialty product sales down 23% ❑ Structural product sales
Slide 9: Specialty Products Q3 2023 Results
SPECIALTY PRODUCTS Q3 2023 RESULTS Q3 Commentary ($ millions) ▪ Net sales of $559M, down 23% ▪ Driven by both price and volume ▪ Specialty sales is 69% of total net sales ▪ Gross profit of $111M, down 27% ▪ Specialty gross profit 80% of total gross profit ▪ Gross margin of 19.8%, down 110 bps ▪ High
Slide 10: Structural Products Q3 2023 Results
STRUCTURAL PRODUCTS Q3 2023 RESULTS Q3 Commentary ($ millions) ▪ Net sales of $251M, down 25% ▪ Lower year-over-year average pricing for commodities: ❑ 26% decrease in average price of lumber ❑ 5% decrease in average price of panels ▪ Lower volume ▪ Gross profit of $28M, down 25% ▪ Structural gross
Slide 11: Balance Sheet
BALANCE SHEET ($ millions) Gross Debt Structure Debt Maturity Schedule $350* $573 $577 $300 $500 $300 $300 undrawn $223 $300m Senior Notes @ 6% revolver $277 $273 $277 Q3 21 Q3 22 Q3 23 2022 2023 2024 2025 2026 2027 2028 2029 Finance Leases Revolver Senior Notes Note: debt maturity schedule does not
Slide 12: Working Capital and Free Cash Flow
WORKING CAPITAL AND FREE CASH FLOW Operating Working Q3 23 Free Cash Flow Walk Capital Management(1) $ in millions $ in millions (1) Operating working capital includes accounts receivable, inventory, and accounts payable; Return on Working Capital is calculated by dividing trailing twelve month (TTM
Slide 13: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK GUIDING PRINCIPLES ▪ Maintain strong balance sheet and OPERATING CASH FLOW FREE CASH FLOW financial stability ▪ Long-term net leverage could increase to at or around 3.0x when INVEST IN THE STRATEGIC SHARE considering growth BUSINESS ACQUISITIONS REPURCHASES ▪ Invest in
Slide 14: Q&A
Q&A BLUELINX “
Slide 15: Appendix
Appendix BLUELINX 5
Slide 16: Macro Trends
MACRO TRENDS Starts expected to be around 20-year average and well above 2009-2011 levels Remodeling spend expected to slow in 2023 and 2024 20-year average ~7 months of home inventory Mortgage rates expected to remain above 20-year average 20-year average 20-year average (1) Source: Historical data
Slide 17: Wood-Based Commodity Price Trends
WOOD-BASED COMMODITY PRICE TRENDS Average Q3 23 lumber prices declined 26% year-over-year and increased 7% from Q2 23 Average Q3 23 panel prices declined 5% year- over-year and increased 20% from Q2 23 (1) Source: Random Lengths, company analysis 17
Slide 18: Non-GAAP Measures
Non-GAAP Measures 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
Slide 19: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Net sales, gross profit dollars, gross profit percentages, sales mix, and gross profit mix by product category by fiscal quarter, Q3 2020 – Q3 2023 In millions where dollars are presented 19
Slide 20: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Adjusted EBITDA reconciliation by fiscal quarter, Q3 2020 – Q3 2023 In millions where dollars are presented (1) Reflects costs related to our restructuring efforts, such as severance, net of other one-time non-operating items. For the pur
Slide 21: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Free cash flow for the three months ended Q3 2023, Q3 2022, Q3 2021, and Q3 2020 In millions where dollars are presented 21
Slide 22: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Working capital by fiscal quarter, Q3 2021 – Q3 2023 In millions where dollars are presented 22
Slide 23: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Net leverage ratio for the trailing twelve months ended Q3 2023 with accompanying Adjusted EBITDA reconciliation In millions where dollars are presented 23
Slide 24: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Net leverage ratio for the trailing twelve months ended Q3 2022 with accompanying Adjusted EBITDA reconciliation In millions where dollars are presented 24
Slide 25: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Net leverage ratio for the trailing twelve months ended Q3 2021 with accompanying Adjusted EBITDA reconciliation In millions where dollars are presented 25
Slide 26: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Net leverage ratio for the trailing twelve months ended Q3 2020 with accompanying Adjusted EBITDA reconciliation In millions where dollars are presented 26
Slide 27: Reconciliation / supplementary financial information
Non-GAAP Reconciliation / supplementary financial information Adjusted Net Income and Adjusted Diluted Income per Share reconciliation for the three-month periods ended Q3 2023, Q3 2022, Q3 2021, and Q3 2020 In thousands where dollars are presented, except per share data (1) Tax impact calculated ba