EX-99.1 2 ex99-1.htm EXHIBIT 99.1 ex99-1.htm

Exhibit 99.1
 
(bluelinx logo)  
   
4300 Wildwood Parkway  
Atlanta, GA  30339  
1-888-502-BLUE  
www.BlueLinxCo.com  
   
Doug Goforth, CFO & Treasurer Investor Relations:
BlueLinx Holdings Inc.  Maryon Davis, Director Finance & IR
(770) 953-7505 (770) 221-2666
   
FOR IMMEDIATE RELEASE  
 
BLUELINX ANNOUNCES FOURTH-QUARTER AND FULL-YEAR RESULTS
Revenue Increases 8.7% to $1.91 Billion for the Year; Up 12.6% for the Quarter
 
ATLANTA – February 13, 2013 – BlueLinx Holdings Inc. (NYSE:BXC), a leading distributor of building products in North America, today reported financial results for the fourth quarter and full year ended December 29, 2012.
 
The Company reported revenues for the fourth quarter of $440.3 million, up 12.6% from $391.1 million for the fourth quarter of 2011.  Fourth-quarter 2012 net loss of $11.4 million, or $0.19 per diluted share, compared with a net loss of $10.3 million, or $0.17 per diluted share, a year ago.  Gross profit for the fourth quarter totaled $52.1 million, up 8.7% from $48.0 million in the year-ago period.  Gross margins of 11.8% compared to 12.3% a year ago.  Fourth-quarter operating expenses of $56.7 million were up compared to $50.5 million for the same period a year ago, and included $0.2 million, or $0.00 per diluted share, and $3.9 million, or $0.07 per diluted share, in net gains from significant special items in 2012 and 2011, respectively.  Reported operating loss for the quarter was $4.5 million, compared to $2.6 million a year ago.
 
For the full year ended December 29, 2012, revenues totaled $1.908 billion, up 8.7% from $1.755 billion the same period a year ago.  Net loss for the year ended December 29, 2012 totaled $23.0 million, or $0.38 per diluted share, compared with $38.6 million, or $0.89 per diluted share, a year ago.  Gross profit for the year ended December 29, 2012 totaled $230.1 million and gross margin was 12.1%, compared with $210.1 million and 12.0% a year earlier. Total operating expenses of $224.6 million were up compared to $218.4 a year ago, and included $10.4 million, or $0.17 per diluted share, and $12.6 million, or $0.29 per diluted share, in net gains from significant special items in 2012 and 2011, respectively. Reported operating income for the year ended December 29, 2012 was $5.5 million, compared to an operating loss of $8.3 million a year ago.
 
“For the full year 2012, we grew total revenue 8.7% while successfully producing our highest gross profit margins on record as we focused on opportunities for profitable growth.  As a result, we narrowed our comparable full year adjusted net loss by $12.2 million relative to a year ago as the housing market continued to accelerate,” said George Judd, President and Chief Executive Officer.
 
“As we move forward in 2013, we are confident in our ability to both increase our penetration of a growing market and maintain the operating discipline that we demonstrated over the last several years. Our outlook in 2013 is based on expectations of a significant increase in revenue from 2012,” Mr. Judd concluded.
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 2 of  8
 
The Company’s operating results for the 2012 and 2011 fourth quarter and full year periods, adjusted for significant special items, are shown in the following table (see accompanying financial schedules for full financial details and reconciliations of non-GAAP financial measures to their GAAP equivalents):
 
in millions, except per share amounts
(unaudited)
 
Quarters Ended
 
Years Ended
   
December 29,
2012
 
December 31,
2011
 
December 29,
2012
 
December 31,
2011
Pretax loss
    ($11.3 )     ($9.4 )     ($22.6 )     ($37.6 )
Gain from sale of certain properties1
    (0.2 )     (3.7 )     (9.9 )     (10.6 )
Gain on modification of lease agreement1
    -       -       -       (2.0 )
Gain from insurance settlement1
    -       (0.2 )     (0.5 )     (1.4 )
Severance related costs1
    -       -       -       1.4  
Adjusted pretax loss before the effect of special interest items
    (11.5 )     (13.3 )     (33.0 )     (50.2 )
Changes associated with the ineffective interest rate swap
    -       -       -       (1.7 )
                                 
Adjusted pretax loss
    (11.5 )     (13.3 )     (33.0 )     (51.9 )
Adjusted benefit from income taxes
    (4.4 )     (4.3 )     (12.4 )     (19.1 )
                                 
Adjusted net loss
    ($7.1 )     ($9.0 )     ($20.6 )     ($32.8 )
                                 
Basic weighted average shares2
    60.1       59.7       60.1       43.2  
Adjusted basic net loss per share applicable to common shares
    ($0.12 )     ($0.15 )     ($0.34 )     ($0.76 )
Diluted weighted average shares2
    60.1       59.7       60.1       43.2  
Adjusted diluted net loss per share applicable to common shares
    ($0.12 )     ($0.15 )     ($0.34 )     ($0.76 )
                                 
1 Significant special items included in SG&A
    ($0.2 )     ($3.9 )     ($10.4 )     ($12.6 )
1 Dilutive EPS related to significant special items included in SG&A
    -       ($0.07 )     ($0.17 )     ($0.29 )
2 The increase in basic and diluted weighted average shares primarily results from the issuance of 28.6 million shares as a result of the July 29, 2011 rights offering.
 
 
For the quarter and full year periods ended December 29, 2012, the above table reflects the following events; (i) the Company recorded a gain on the sale of certain properties; and (ii) the Company recorded a gain from an insurance settlement.  The adjusted benefit from income taxes reflected in the table is comprised of the Company’s effective tax rate excluding the valuation allowance related to its deferred tax assets and the tax effect of significant special items.  The adjusted benefit from income taxes assumes the Company’s deferred tax assets are realizable.
 
For the quarter and full year periods ended December 31, 2011, the above table reflects the following events:  (i) the Company recorded a gain on the sale of certain properties during the first quarter of 2011; (ii) the Company recorded a gain on the modification of a lease agreement; (iii) the Company recorded a gain from an insurance settlement; (iv) the Company recorded certain severance costs; and (v) the Company recorded the effect of a reduction in the fair value of its terminated ineffective interest rate swap partially offset by the continued amortization of the accumulated other comprehensive loss related to the ineffective interest rate swap into interest expense.  The adjusted benefit from income taxes reflected in the table is comprised of the Company’s effective tax rate excluding the valuation allowance related to its deferred tax assets, a tax benefit related to our intra period income tax allocation to other comprehensive income and the tax effect of significant special items.  The adjusted benefit from income taxes assumes the Company’s deferred tax assets are realizable.
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 3 of  8
 
2013 Item
The Company intends to amend and extend its $400 million U.S. revolving credit facility. The amendment will extend the maturity by three years from the closing date. It is expected that the maximum available credit under the U.S. revolving credit facility will be increased by $22.5 million to $422.5 million. The amended U.S. revolving credit facility is also expected to continue to have a $100 million uncommitted accordion credit facility to potentially increase the maximum available credit to $522.5 million. The amended U.S. revolving credit facility is expected to have covenants substantially similar to those in the existing U.S. credit facility.
 
The Company has engaged Wells Fargo Capital Finance (“Wells Fargo”) as sole lead arranger for the transaction. Wells Fargo has informed the Company that it has received commitments from several financial institutions with respect to the U.S. revolving credit facility, subject to execution of satisfactory documentation and the completion of the $40 million rights offering of common stock announced on January 10, 2013. Closing is expected to occur concurrently with the completion of the rights offering of common stock. The definitive terms of, and the obligations of BlueLinx, Wells Fargo, and/or any members of the syndicate of financial institutions to enter into such an amendment to the U.S. revolving credit facility is subject to additional discussions and negotiations among the parties, and there is no assurance that an amendment to the existing U.S. revolving credit facility will be consummated.
 
Conference Call
BlueLinx will host a conference call today at 10:00 a.m. Eastern Time, accompanied by a supporting slide presentation.  Investors can listen to the conference call and view the accompanying slide presentation by going to the BlueLinx web site, www.BlueLinxCo.com, and selecting the conference link on the Investor Relations page.  Investors will be able to access an archived recording of the conference call for one week by calling 404-537-3406, Conference ID# 93184373.  The recording will be available two hours after the conference call has concluded.  Investors also can access a recording of this call on the BlueLinx web site, where a replay of the webcast will be available for 90 days.
 
Use of Non-GAAP Measures
BlueLinx reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). The Company also believes that presentation of certain non-GAAP measures, i.e., results excluding certain charges or other nonrecurring events, when appropriate, provides useful information for the understanding of its ongoing operations and enables investors to focus on period-over-period operating performance, without the impact of significant special items, and thereby enhances the user’s overall understanding of the Company’s current financial performance relative to past performance and provides a better baseline for modeling future earnings expectations. Any non-GAAP measures used herein are reconciled in the financial tables accompanying this news release.  The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for, the Company’s reported GAAP results.
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 4 of  8
 
About BlueLinx Holdings Inc.
Headquartered in Atlanta, Georgia, BlueLinx Holdings Inc., operating through its wholly owned subsidiary BlueLinx Corporation, is a leading distributor of building products in North America. Employing approximately 1,900 people, BlueLinx offers greater than 10,000 products from over 750 suppliers to service approximately 11,500 customers nationwide, including dealers, industrial manufacturers, manufactured housing producers and home improvement retailers. The Company operates its distribution business from sales centers in Atlanta and Denver, and its network of 56 distribution centers.  BlueLinx is traded on the New York Stock Exchange under the symbol BXC. Additional information about BlueLinx can be found on its Web site at www.BlueLinxCo.com.
 
Forward-looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to our ability to return to profitability and our outlook on the housing industry.  All of these forward-looking statements are based on estimates and assumptions made by our management that, although believed by BlueLinx 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 BlueLinx’ control that may cause its 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 that it distributes, 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, including the availability of residential mortgages; 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 the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 and in its periodic reports filed with the Securities and Exchange Commission from time to time. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. BlueLinx undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events, changes in expectation or otherwise, except as required by law.
 
- Tables to Follow -
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 5 of  8
 
BlueLinx Holdings Inc.
                       
Statements of Operations
                       
in thousands, except per share data
                       
      Quarters Ended       Years Ended  
   
December 29,
   
December 31,
   
December 29,
   
December 31,
 
   
2012
   
2011
   
2012
   
2011
 
   
(unaudited)
   
(unaudited)
   
(unaudited)
       
                         
Net sales
  $ 440,298     $ 391,119     $ 1,907,842     $ 1,755,431  
Cost of sales
    388,179       343,162       1,677,772       1,545,282  
Gross profit
    52,119       47,957       230,070       210,149  
Operating expenses:
                               
     Selling, general, and administrative
    54,638       48,094       215,996       207,857  
     Depreciation and amortization
    2,012       2,441       8,565       10,562  
Total operating expenses
    56,650       50,535       224,561       218,419  
                                 
Operating (loss) income
    (4,531 )     (2,578 )     5,509       (8,270 )
Non-operating expenses:
                               
     Interest expense
    6,756       6,831       28,157       30,510  
     Changes associated with the ineffective interest rate swap, net
    -       -       -       (1,676 )
     Other expense (income), net
    22       19       (7 )     501  
                                 
Loss before provision for income taxes
    (11,309 )     (9,428 )     (22,641 )     (37,605 )
Provision for income taxes
    61       824       386       962  
Net loss
  $ (11,370 )   $ (10,252 )   $ (23,027 )   $ (38,567 )
                                 
Basic weighted average number of common shares
                               
    outstanding
    60,118       59,660       60,080       43,187  
Basic net loss per share applicable to common
                               
    shares
  $ (0.19 )   $ (0.17 )   $ (0.38 )   $ (0.89 )
Diluted weighted average number of common shares
                               
    outstanding
    60,118       59,660       60,080       43,187  
Diluted net loss per share applicable to common
                               
    shares
  $ (0.19 )   $ (0.17 )   $ (0.38 )   $ (0.89 )
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 6 of  8
 
BlueLinx Holdings Inc.
           
Balance Sheets
           
     in thousands
           
             
   
December 29,
   
December 31,
 
   
2012
   
2011
 
   
(unaudited)
       
Assets:
           
Current assets:
           
     Cash and cash equivalents
  $ 5,188     $ 4,898  
     Receivables, net
    157,465       138,872  
     Inventories, net
    230,059       185,577  
     Other current assets
    19,427       27,141  
Total current assets
    412,139       356,488  
                 
Property, plant, and equipment:
               
     Land and land improvements
    43,120       49,562  
     Buildings
    94,070       95,652  
     Machinery and equipment
    78,674       75,508  
     Construction in progress
    1,173       741  
Property, plant, and equipment, at cost
    217,037       221,463  
     Accumulated depreciation
    (101,684 )     (98,335 )
     Property, plant, and equipment, net
    115,353       123,128  
Non-current deferred income tax assets, net
    445       358  
Other non-current assets
    16,799       23,941  
Total assets
  $ 544,736     $ 503,915  
                 
Liabilities:
               
Current liabilities:
               
     Accounts payable
  $ 77,850     $ 70,228  
     Bank overdrafts
    35,384       22,364  
     Accrued compensation
    6,170       4,496  
     Current maturities of long-term debt
    8,946       9,046  
     Deferred income taxes, net
    449       382  
     Other current liabilities
    10,937       16,558  
Total current liabilities
    139,736       123,074  
Noncurrent liabilities:
               
     Long-term debt
    368,446       328,695  
     Other non-current liabilities
    57,146       43,772  
Total liabilities
    565,328       495,541  
                 
Stockholders’ (Deficit) Equity:
               
     Common stock
    637       620  
     Additional paid-in capital
    209,815       207,626  
     Accumulated other comprehensive loss
    (30,042 )     (21,900 )
     Accumulated deficit
    (201,002 )     (177,972 )
Total stockholders’ (deficit) equity
    (20,592 )     8,374  
Total liabilities and stockholders’ (deficit) equity
  $ 544,736     $ 503,915  
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 7 of  8
 
BlueLinx Holdings Inc.
           
Statements of Cash Flows
           
     in thousands
           
             
   
Years Ended
 
   
December 29,
   
December 31,
 
   
2012
   
2011
 
   
(unaudited)
       
             
Cash flows from operating activities:
           
Net loss
  $ (23,027 )   $ (38,567 )
Adjustments to reconcile net loss
               
     to cash used in operations:
               
        Depreciation and amortization
    8,565       10,562  
        Amortization of debt issuance costs
    3,746       2,940  
        Gain from sale of properties
    (9,885 )     (10,604 )
        Gain from property insurance settlement
    (476 )     (1,230 )
        Changes associated with the ineffective interest rate swap
    -       (1,676 )
        Vacant property charges, net
    (30 )     (291 )
        Gain on modification of lease agreement
    -       (1,971 )
        Payments on modification on lease agreement
    (5,875 )     -  
        Deferred income tax benefit
    (20 )     (25 )
        Share-based compensation expense
    2,797       1,974  
        Decrease in restricted cash related to the swap, insurance, and other
    695       987  
        Changes in assets and liabilities:
               
            Receivables
    (18,593 )     (19,670 )
            Inventories
    (44,482 )     2,673  
           Accounts payable
    9,050       5,973  
           Changes in other working capital
    1,722       (375 )
           Other
    1,563       (1,032 )
Net cash used in operating activities
    (74,250 )     (50,332 )
                 
Cash flows from investing activities:
               
Property, plant and equipment investments
    (2,826 )     (6,533 )
Proceeds from disposition of assets
    19,195       18,355  
Net cash provided by investing activities
    16,369       11,822  
                 
Cash flows from financing activities:
               
Repurchase of shares to satisfy employee tax withholdings
    (526 )     -  
Repayments on the revolving credit facilities
    (473,349 )     (478,630 )
Borrowings from the revolving credit facilities
    550,270       475,918  
Principal payments on mortgage
    (37,272 )     (42,416 )
Payments on capital lease obligations
    (2,259 )     (1,440 )
Increase (decrease) in bank overdrafts
    13,020       (725 )
Decrease in restricted cash related to the mortgage
    9,970       20,604  
Debt financing costs
    (1,683 )     (2,721 )
Proceeds from stock offering less expenses paid
    -       58,521  
Net cash provided by financing activities
    58,171       29,111  
Increase (decrease) in cash
    290       (9,399 )
Balance, beginning of period
    4,898       14,297  
Balance, end of period
  $ 5,188     $ 4,898  
                 
Non Cash Transactions:
               
Capital leases
  $ 5,238     $ 3,131  
 
 
 

 
 
BlueLinx 4Q ’12 Press Release
Page 8 of  8
 
BlueLinx Holdings Inc.
                       
Adjusted Pre-Tax Loss
                       
in thousands, except for per share amounts
                       
                         
   
Quarters Ended
   
Years Ended
 
   
December 29,
   
December 31,
   
December 29,
   
December 31,
 
   
2012
   
2011
   
2012
   
2011
 
   
(unaudited)
   
(unaudited)
   
(unaudited)
   
(unaudited)
 
                         
Pretax loss
  $ (11,309 )   $ (9,428 )   $ (22,641 )   $ (37,605 )
Gain from sale of certain properties
    (204 )     (3,665 )     (9,885 )     (10,604 )
Gain on modification of lease agreement
    -       -       -       (1,971 )
Gain from insurance settlement
    -       (203 )     (476 )     (1,433 )
Severance related costs
    -       36       -       1,382  
Adjusted pretax loss before the effect of special interest items
    (11,513 )     (13,260 )     (33,002 )     (50,231 )
Changes associated with the ineffective interest rate swap
    -       -       -       (1,676 )
Adjusted pretax loss
    (11,513 )     (13,260 )     (33,002 )     (51,907 )
Adjusted benefit from income taxes
    (4,385 )     (4,294 )     (12,351 )     (19,072 )
Adjusted net loss
  $ (7,128 )   $ (8,966 )   $ (20,651 )   $ (32,835 )
                                 
Basic weighted average shares
    60,118       59,660       60,080       43,187  
Adjusted basic net loss per share applicable to common shares
  $ (0.12 )   $ (0.15 )   $ (0.34 )   $ (0.76 )
Diluted weighted average shares
    60,118       59,660       60,080       43,187  
Adjusted diluted net loss per share applicable to common shares
  $ (0.12 )   $ (0.15 )   $ (0.34 )   $ (0.76 )
 
 
 
 
BlueLinx Holdings Inc.
                       
Reconciliation of GAAP Net Loss to Adjusted Net Loss
                       
in thousands
                       
                         
   
Quarters Ended
   
Years Ended
 
   
December 29,
   
December 31,
   
December 29,
   
December 31,
 
   
2012
   
2011
   
2012
   
2011
 
   
(unaudited)
   
(unaudited)
   
(unaudited)
   
(unaudited)
 
                         
GAAP net loss
  $ (11,370 )   $ (10,252 )   $ (23,027 )   $ (38,567 )
Gain from sale of certain properties
    (204 )     (3,665 )     (9,885 )     (10,604 )
Gain on modification of lease agreement
    -       -       -       (1,971 )
Gain from insurance settlement
    -       (203 )     (476 )     (1,433 )
Severance related costs
    -       36       -       1,382  
Changes associated with the ineffective interest rate swap
    -       -       -       (1,676 )
Tax effect of selected charges
    80       1,479       3,998       5,522  
Valuation allowance
    4,366       3,639       8,739       14,512  
Adjusted net loss
  $ (7,128 )   $ (8,966 )   $ (20,651 )   $ (32,835 )
 
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