BMC Stock Holdings Inc

BMC Stock — Investor Presentation (August 2017)

29 slides from BMC Stock's investor presentation, Aug 4, 2017

  1. Slide 1: BMC Stock Holdings, Inc. Investor Presentation

    © 2017 BMC. All Rights Reserved. BMC STOCK HOLDINGS, INC. INVESTOR PRESENTATION August 3, 2017

  2. Slide 2: Forward-Looking Statements

    CLICK TO EDIT TITLE DISCLAIMER 2 Forward-Looking Statements This document contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this document may include, without limitation, statements regarding sales growth,

  3. Slide 3: Non-GAAP (Adjusted) Financial Measures

    CLICK TO EDIT TITLE NON-GAAP (ADJUSTED) FINANCIAL MEASURES 3 Adjusted net sales, Adjusted gross profit, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income and Adjusted net income per diluted share are intended as supplemental measures of the Company‟s performance that are not required by,

  4. Slide 4: Company Overview

    © 2017 BMC. All Rights Reserved. COMPANY OVERVIEW 1

  5. Slide 5: BMC Company Snapshot

    CLICK TO EDIT TITLE BMC COMPANY SNAPSHOT NASDAQ LISTED: BMCH 5 2016 Product & Service Mix  A leading national building solutions provider with $3.1 billion of net sales and $193.9 million of Adjusted EBITDA(1) for 2016  Locations in 18 states representing 64% of 2016 single- family building permit

  6. Slide 6: Strategic Footprint in Highly Attractive, Long-Term Growth Markets

    CLICK TO EDIT TITLE STRATEGIC FOOTPRINT IN HIGHLY ATTRACTIVE, LONG-TERM GROWTH MARKETS 6 2016 Sales by U.S. Census Division Company Footprint FL NM TX MT CO UT ID NV WA CA PA VA AR GA 93 Distribution locations in 18 states 53 Ready-Frame, EWP, Truss & Panel Manufacturing Facilities 52 Millwork opera

  7. Slide 7: Value-Added Services Support Job Site Excellence

    CLICK TO EDIT TITLE VALUE-ADDED SERVICES SUPPORT JOB SITE EXCELLENCE ONE-STEP VALUE CHAIN – SHOWROOM TO JOB-SITE…CONTRACTOR TO CLIENT 7  Providing differentiated solutions and proprietary services that support our unique value proposition  Driving enhanced productivity and customer satisfaction 

  8. Slide 8: Highly Diversified and Growing Customer Base

    CLICK TO EDIT TITLE  Diverse base of customers ranging from well- known national builders to small regional and local players  No single customer greater than 5% of total net sales  Enhanced capabilities to serve attractive professional repair and remodeling contractor segment Select Customers Mu

  9. Slide 9: Diversity of Supplier Base

    CLICK TO EDIT TITLE BMC Provides Strategic Go-to-Market Options for Suppliers  Diverse base of leading building products manufacturers  One-step value-added distributor providing direct access to thousands of customers DIVERSITY OF SUPPLIER BASE STRATEGIC AGREEMENTS IN PLACE WITH LEADING BUILDING

  10. Slide 10: Merger Synergies and Integration Costs

    CLICK TO EDIT TITLE  Incremental opportunities from best practices:  Millwork and components manufacturing  Ready-Frame  Logistics, design and eCommerce capabilities  Working capital optimization  $15 million of integration costs in 2016; $15 to $18 million expected in 2017, primarily related

  11. Slide 11: Focused Growth Strategy

    © 2017 BMC. All Rights Reserved. FOCUSED GROWTH STRATEGY 2

  12. Slide 12: BMC Investment Highlights

    CLICK TO EDIT TITLE BMC INVESTMENT HIGHLIGHTS • Focused on adding to our extensive value-added (and higher-margin) product and service capabilities – We believe that we are the largest provider of Millwork in the U.S. • Favorable Industry Trends • Strong balance sheet with low levels of debt • Poise

  13. Slide 13: Executing Strategies to Grow Value-Added, Higher-Margin Categories

    CLICK TO EDIT TITLE Other Bldg. Products & Services 26% Lumber & Sheet Goods 35% Millwork, Doors & Windows 25% Structural Components 14%  Leading provider of moldings, custom millwork, interior doors, stairs, columns and windows, including manufacturing capabilities  Supported by web-based catalog

  14. Slide 14: Ready-Frame - Poised to Drive Future Growth

    CLICK TO EDIT TITLE READY-FRAME® - POISED TO DRIVE FUTURE GROWTH OPPORTUNITY TO TRANSITION COMMODITY LUMBER SALES TO VALUE-ADDED 14 Less Risk. Less Labor. Less Cost R ea dy -Fr am e S ale s (d ol la rs in m ill io ns ) READY-FRAME video: https://www.youtube.com/watch?v=REv665u2QRI

  15. Slide 15: Why Ready-Frame? A Win-Win Offering

    CLICK TO EDIT TITLE WHY READY-FRAME? A WIN-WIN OFFERING FOR BMC AND FOR CUSTOMERS 15 For Builders For Framers For BMC Shortens cash conversion cycle time; Less framing time needed Can frame 20 – 30% more homes in same amount of time (Note: framers are typically paid by the square foot.) Higher margi

  16. Slide 16: BMC's Lean eBusiness Evolution

    CLICK TO EDIT TITLE BMC’S LEAN EBUSINESS EVOLUTION BUILDING A TECHNOLOGY PLATFORM TO ENABLE AND LEVERAGE PROFITABLE GROWTH 16 >92% 1. Reduced product costs from Photo Proof of Delivery, which has reduced Claims, including Returns, Damages and Missing Product 2. As of 6/30/17, transactional capabilit

  17. Slide 17: 24x7 Transactional Front-End to ERP

    CLICK TO EDIT TITLE 24X7 TRANSACTIONAL FRONT-END TO ERP ENHANCES CUSTOMER EXPERIENCE / PRODUCTIVITY 17 Easy, Fast, Convenient  Intuitive interface  Accessible 24x7  Mobile based platform  Full breadth of products  Customer specific pricing  Product availability and lead times Professional Reso

  18. Slide 18: Positioned to Utilize M&A to Drive Future Growth

    CLICK TO EDIT TITLE POSITIONED TO UTILIZE M&A TO DRIVE FUTURE GROWTH FRAGMENTED MARKET COMBINED WITH PROVEN AND DISCIPLINED M&A PROCESS Fragmentation Presents Significant Consolidation Opportunities  Leverage profile provides financial flexibility to pursue accretive M&A  Continuing to pursue accr

  19. Slide 19: Financial Overview

    © 2017 BMC. All Rights Reserved. FINANCIAL OVERVIEW 3

  20. Slide 20: Proven Track Record of Growth

    CLICK TO EDIT TITLE CAGR: 10.1% PROVEN TRACK RECORD OF GROWTH 20  Adjusted net sales(1) CAGR(2) of 10.1% from 2013 to 2016 compared to single- family starts CAGR of 8.2%  Adjusted gross profit(1) as a percent of adjusted net sales increased 200 basis points since 2013  Adjusted EBITDA(1) CAGR of

  21. Slide 21: Q2 2017 Financial Results

    CLICK TO EDIT TITLE Q2 2017 FINANCIA RESULTS 21 Q2 2017 Financial Performance Q2 2017 Commentary 1. See Non-GAAP (Adjusted) Financial Measures pages of this presentation for definition of Adjusted EBITDA , Adjusted net income and Adjusted net income per diluted share.  Total Q2 2017 net sales growt

  22. Slide 22: Strong Balance Sheet to Support Growth

    CLICK TO EDIT TITLE STRONG BALANCE SHEET TO SUPPORT GROWTH FLEXIBILITY FOR CONTINUED INVESTMENTS AND DISCIPLINED, ACCRETIVE M&A 22 1. See Non-GAAP (Adjusted) Financial Measures page of this presentation for definition of Adjusted EBITDA 2. Estimated total after taking into account the acquisitions o

  23. Slide 23: Solid Balance Sheet and Ample Liquidity

    CLICK TO EDIT TITLE SOLID BALANCE SHEET AND AMPLE LIQUIDITY SUPPORT BUSINESS STRATEGY AND INITIATIVES 23 Selectively Pursue Strategic Acquisitions Ample Liquidity Improve Growth and Margin Profile Increase Productivity and Reduce Expenses Conservative Capital Structure  Grow scale and expand produc

  24. Slide 24: Driving Long-Term Shareholder Value

    CLICK TO EDIT TITLE DRIVING LONG-TERM SHAREHOLDER VALUE -- LEVERAGING STRONG FOUNDATION AND CORE CAPABILITIES TO ACCELERATE GROWTH IN EBITDA MARGIN 24 Favorable Macro Trends Differentiated Value- Added Solutions Growth Strategies Drive Profitable Growth  Job & Wage Growth  Consumer Confidence  Lo

  25. Slide 25: Appendix

    © 2017 BMC. All Rights Reserved. APPENDIX

  26. Slide 26: Reported (GAAP) Income Statement

    BMC STOCK HOLDINGS REPORTED (GAAP) INCOME STATEMENT ($ths) Q1 15 Q2 15 Q3 15 Q4 15 FY 2015 Q1 16 Q2 16 Q3 16 Q4 16 FY 2016 Q1 17 Q2 17 Net sales 292,826 357,287 416,471 510,162 1,576,746 727,418 797,547 821,204 747,574 3,093,743 757,700 886,375 Cost of sales 226,129 273,469 319,370 396,368 1,215,336

  27. Slide 27: Reconciliation: Adjusted Net Sales, Adjusted Gross Profit

    BMC STOCK HOLDINGS RECONCILIATION OF NON-GAAP ITEMS ADJUSTED NET SALES, ADJUSTED GROSS PROFIT ($ths) Q1 15 Q2 15 Q3 15 Q4 15 FY 2015 Q1 16 Q2 16 Q3 16 Q4 16 FY 2016 Q1 17 Q2 17 Net sales 292,826 357,287 416,471 510,162 1,576,746 727,418 797,547 821,204 747,574 3,093,743 757,700 886,375 Pre-merger SB

  28. Slide 28: Reconciliation: Adjusted EBITDA

    BMC STOCK HOLDINGS RECONCILIATION OF NON-GAAP ITEMS ADJUSTED EBITDA ($ths) Q1 15 Q2 15 Q3 15 Q4 15 FY 2015 Q1 16 Q2 16 Q3 16 Q4 16 FY 2016 Q1 17 Q2 17 Net (loss) income (3,561) 2,125 4,047 (7,442) (4,831) (6,756) 17,982 9,236 10,418 30,880 3,744 17,596 Pre-merger SBS income (loss) from continuing op

  29. Slide 29: Reconciliation: Adjusted Net Income and Adjusted EPS

    BMC STOCK HOLDINGS RECONCILIATION OF NON-GAAP ITEMS ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE (in $ths, except per share amounts) Q2 2017 Q2 2016 Net income 17,596 17,982 Merger and integration costs 6,324 3,597 Non-cash stock compensation expense 2,154 1,804 Acquisition costs (a) 44 - Imp

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