EX-99.2 3 c20907exv99w2.htm EXHIBIT 99.2 Exhibit 99.2

Exhibit 99.2

BlueLinx Quarterly Review2nd Quarter 2011


 

2 BlueLinx Holdings Inc. Forward-Looking Statement Safe Harbor - This presentation includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All of these forward-looking statements 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, including, but not limited to, economic, competitive, governmental and technological factors outside of our control, that may cause our business, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may include, among other things: changes in the supply and/or demand for products which we distribute, especially as a result of conditions in the residential housing market; general economic and business conditions in the United States; the activities of competitors; changes in significant operating expenses; changes in the availability of capital; the ability to identify acquisition opportunities and effectively and cost-efficiently integrate acquisitions; adverse weather patterns or conditions; acts of war or terrorist activities; variations in the performance of the financial markets; and other factors described in the "Risk Factors" section in our Annual Report on Form 10-K for the fiscal year ended January 1, 2011, and in our other periodic reports filed with the SEC. In addition, the statements in this presentation are made as of August 4, 2011. We undertake no obligation to update any of the forward-looking statements made herein, whether as a result of new information, future events, changes in expectation or otherwise. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to August 4, 2011. Use of Non-GAAP and Adjusted Financial Information - To supplement GAAP financial information, we use adjusted measures of operating results which are non-GAAP measures. This non-GAAP adjusted financial information is provided as additional information for investors. These adjusted results exclude certain costs, expenses, gains and losses, and we believe their exclusion can enhance an overall understanding of our past financial performance and also our prospects for the future. These adjustments to our GAAP results are made with the intent of providing both management and investors a more complete understanding of our operating performance by excluding non-recurring, infrequent or other non-cash charges that are not believed to be material to the ongoing performance of our business. The presentation of this additional information is not meant to be considered in isolation or as a substitute for GAAP measures of net earnings, diluted earnings per share or net cash provided by (used in) operating activities prepared in accordance with generally accepted accounting principles in the United States.


 

3 2nd Quarter Highlights 2nd Quarter Highlights Revenue Down 7.4% to $500.8 million Down 7.4% to $500.8 million Housing Starts Total starts decreased 4.0% from the same period last year; Single family starts decreased 13.1% from the same period last year Total starts decreased 4.0% from the same period last year; Single family starts decreased 13.1% from the same period last year Prices Average 2Q '11 benchmark wood-based structural prices were down approximately 20% compared to 2Q '10 Average 2Q '11 benchmark wood-based structural prices were down approximately 20% compared to 2Q '10 Unit Volume Down 0.5% relative to the same period last year Down 0.5% relative to the same period last year Gross Margin Total 11.5% vs. 11.9% in 2Q '10 Total 11.5% vs. 11.9% in 2Q '10 Net Loss ($9.8) million vs. ($3.4) million in 2Q '10 ($9.8) million vs. ($3.4) million in 2Q '10 EPS ($0.31) per diluted share ($0.31) per diluted share Cash Flow Used $38.3 million of operating cash flow vs. used $34.3 million for the year ago quarter Used $38.3 million of operating cash flow vs. used $34.3 million for the year ago quarter Excess Availability $94 million excess availability on revolving credit facility $94 million excess availability on revolving credit facility Quarterly Highlights


 

4 Doug GoforthChief Financial Officer and Treasurer Introduction and Financial Review


 

5 Quarterly Revenue 4Q '05 1Q '06 2Q '06 3Q '06 4Q '06 1Q '07 2Q '07 3Q '07 4Q '07 1Q '08 2Q '08 3Q '08 4Q '08 1Q '09 2Q '09 3Q '09 4Q '09 1Q '10 2Q '10 3Q '10 4Q '10 1Q '11 2Q '11 Specialty 539.5 580 603.3 553.5 460 456.5 500.8 462.9 381.5 354 402.8 375.9 278.7 233.9 250 257.9 206.2 233.1 286 264.3 221.4 235 316.6 Structural 815.2 813.4 798.7 666.6 509.2 518.9 598.1 571.4 409.6 373 442.4 365.8 240.9 182.5 183 202.1 171 203.7 265.4 213.9 154.8 161.3 193.6 Other -25.4 -16.8 -23 -16.6 -28.9 -18.3 -16.9 -18.4 -12.2 -10.2 -10.5 -14.9 -18.1 -9.3 -9.5 -10.6 -11.1 -5.7 -10.62 -13.5 -8.3 -5.7 -9.4 Specialty Unit Volume 16.5% YOY $40.0 or 7.4% Structural Unit Volume (18.9%) Price/Other ($40.0) 2Q '11 Specialty 316.6 Structural 193.6 2Q '10 2Q '11 2Q '10 Specialty 286 Structural 265.4 Vs. Year AgoRevenue down 7.4%Specialty sales up 10.7%, unit volume up 16.5%Structural sales down 27.1%, unit volume down 18.9%Specialty product sales = 62% of total sales % by Product 4Q '05 1Q '06 2Q '06 3Q '06 4Q '06 1Q '07 2Q '07 3Q '07 4Q '07 1Q '08 2Q '08 3Q '08 4Q '08 1Q '09 2Q '09 3Q '09 4Q '09 1Q '10 2Q '10 3Q '10 4Q '10 Specialty 539.5 580 603.3 553.5 460 456.5 500.8 462.9 381.5 354 402.8 375.9 278.7 233.9 250 257.9 206.2 233.1 286 264.3 221.4 Structural 815.2 813.4 798.7 666.6 509.2 518.9 598.1 571.4 409.6 373 442.4 365.8 240.9 182.5 183 202.1 171 203.7 265.4 213.9 154.8 Other -25.4 -16.8 -23 -16.6 -28.9 -18.3 -16.9 -18.4 -12.2 -10.2 -10.5 -14.9 -18.1 -9.3 -9.5 -10.6 -11.1 -5.7 -10.62 -13.5 -8.3


 

6 2011 YTD Results revenue YTD '10 971.832 YTD '11 891.414 YTD '10 YTD '11 GM % 0.12 0.117 Operating Expense YTD '10 120.782 YTD '11 110.788 YTD '10 YTD '11 EBITDA 2.542 -1.462 Significant Special Items YTD '10 YTD '11 Gain on real estate $- $7.2 ($7.2)


 

7 Cash Flows BXC used $38.3 million in operating cash flow for the quarter Unaudited Direct Method (in million's) (in million's) (in million's)


 

8 Debt Revolver $94 million excess availability as of July 2, 2011LIBOR plus 4.0% as of July 2, 2011$400 million facility with additional $100 million uncommitted accordion facilityMatures January 7, 2014No financial performance covenants provided Excess Availability is more than the greater of (A) $40 million or (B) the amount equal to 15% of the lesser of the borrowing base or $60 million (subject to increase to $75 million if we exercise the uncommitted accordion credit facility in full) (the "Excess Availability Threshold") Capital Spending restrictions apply if financial performance covenants are triggeredDividend restrictions apply if Modified Adjusted Excess Availability is less than $100 millionMortgage (10 Year Term @ 6.35%)Matures July 2016; Interest-only through July 2011 Real estate under the mortgage appraised at approximately $370 million at June 2006LCR Trap is triggered if operating TTM EBITDAR coverage ratio is less than 2.5x for two consecutive quartersSubsequent to the quarter ended July 2, 2011, we negotiated an amendment to our mortgage agreement which in part allowed for the release of the $38.3 million LCR trap. The cash was used for an immediate prepayment on the mortgage loan without incurring a prepayment premiumPrincipal2011 $39.6 million 2014 $3.1 million2012 $2.7 million 2015 $3.0 million2013 $2.9 million 2016 $234.2 million


 

9 Pro Forma Balance Sheet Pro Forma Balance Sheet


 

10 Cash Cycle TTM Cash Cycle days at 58, up 3 days sequentially and up 9 days compared to the prior year quarter 3Q '07 4Q '07 1Q '08 2Q '08 3Q '08 4Q '08 1Q '09 2Q '09 3Q '09 4Q '09 1Q '10 2Q '10 3Q '10 4Q '10 1Q '11 2Q '11 Inv 45.8 44.7 46.3 46.3 45.3 43.9 44 44.7 45.1 43.9 43.9 43.2 44.2 45 48 50 A/R 34.7 32.9 34.5 35.3 34.7 32.4 33 35.6 35.9 32.6 34.4 34 33.9 32 35 36 A/P & OD's -28.7 -27.3 -28.3 -28.8 -27.8 -26.4 -27 -28.4 -28.9 -28 -28.7 -28 -27.2 -25 -28 -28 Cash cycle days equal accounts receivable days + inventory days - accounts payable days using a trailing twelve month average beginning and ending balance. The days calculations use calendar days.


 

11 George JuddChief Executive Officer Business Review


 

12 2nd Quarter focusSpecialty growthCustomer careGross marginLong term strategic objectives:Profitably grow specialty revenues to 60+% of total salesProfitably manage structuralProfitably outgrow the market over the long term Remarks


 

13 Appendix Appendix


 

14 Profit & Loss Statement by Quarter Profit & Loss Statement by Quarter


 

15 Revenues by Quarter Revenues by Quarter


 

16 Revenue Channel Mix Analysis Revenue Channel Mix Analysis


 

17 Unit Volume by Quarter Unit Volume by Quarter


 

18 Gross Margin by Quarter Gross Margin by Quarter


 

19 Gross Margin % Analysis Gross Margin % Analysis


 

20 Operating Expense by Quarter Operating Expense by Quarter


 

21 Structural Products Price Trend Source: Data from Random Lengths Publications, Inc., updated as of July 29, 2011 Source: Data from Random Lengths Publications, Inc., updated as of July 29, 2011 Source: Data from Random Lengths Publications, Inc., updated as of July 29, 2011 Source: Data from Random Lengths Publications, Inc., updated as of July 29, 2011


 

22 Reconciliation of GAAP to Non-GAAP Reconciliation of GAAP to Non-GAAP


 

23 Reconciliation of GAAP to Non-GAAP Reconciliation of GAAP to Non-GAAP


 

24 www.BlueLinxco.com