EX-99.2 4 q4earningsexhibit992.htm EXHIBIT 99.2 Q4 Earnings Exhibit 99.2


Exhibit 99.2




4300 Wildwood Parkway
Atlanta, GA  30339
1-888-502-BLUE
www.BlueLinxCo.com

BlueLinx Contacts:
Susan O’Farrell, SVP, Treasurer & CFO                        Investor Relations:
BlueLinx Holdings Inc.                                Caroline Lowden, Director Finance
(770) 953-7000                                    (770) 953-7522


FOR IMMEDIATE RELEASE


BLUELINX ANNOUNCES FOURTH-QUARTER AND FULL-YEAR RESULTS
- 2014 Adjusted EBITDA of $24.6 million is best since 2007 -
- Fourth Quarter Adjusted EBITDA increased $2.9 million -
- Excess Availability of $60 million -


ATLANTA - February 19, 2015 - BlueLinx Holdings Inc. (NYSE:BXC), a leading distributor of building products in North America, today reported financial results for the fiscal fourth quarter and fiscal year ended January 3, 2015.

Fourth Quarter and Fiscal Year Financial Highlights
•
Adjusted EBITDA of $1.9 million in the quarter, compared to a $1.0 million loss in fourth quarter 2013
•
Adjusted EBITDA of $24.6 million in 2014, compared to $1.3 million in 2013
•
Excess availability of $60 million as of January 3, 2015 , an improvement of $14 million over December 2013

“We are pleased to report fiscal fourth quarter 2014 Adjusted EBITDA of $1.9 million, an improvement of approximately $2.9 million from the fiscal fourth quarter of 2013. The fourth quarter of 2014 represents our sixth consecutive quarter of improved year-over-year EBITDA results, and the full year Adjusted EBITDA of $24.6 million is a $23.3 million improvement over 2013 and our best since 2007. It is apparent that we are beginning to see the results of the numerous initiatives we began in 2014. Our team is energized as we move in to 2015 and looks forward to continuing the momentum we began last year," said Mitch Lewis, President and Chief Executive Officer.

Susan O’Farrell, Senior Vice President and Chief Financial Officer added, “We exited the year in a relatively strong cash position with excess availability of $60 million. This $14 million increase in excess availability from December 2013 enables us to continue to support the business for future growth.”

Full Year Fiscal 2014 Financial Results Compared to Prior Year
Revenues for fiscal 2014 were $1,979.4 million, a decline of $67.8 million, or 3%, on a comparable basis to $2,047.2 million in 2013, which excludes closed centers and the 53rd week. The decrease was $172.6 million, or 8% on an unadjusted basis, compared to the year ended January 4, 2014.

Gross profits for the twelve months ended January 3, 2015, were $229.1 million, compared to $228.5 million for the year ended January 4, 2014. Gross margin increased by approximately 100 basis points in 2014 to 11.6% from 10.6% in fiscal 2013. Comparable gross profit on a same center basis for 2014 increased by $9.0 million, or 4%, compared to the full year 2013 amount of $220.1 million, excluding the 53rd week.

Adjusted EBITDA for fiscal 2014 improved to $24.6 million from an Adjusted EBITDA of $1.3 million for fiscal 2013.


1


The Company recorded an improvement of $26.7 million for a net loss of $13.9 million, $(0.16) per diluted share, in fiscal 2014 compared to the net loss of $40.6 million, $(0.51) per diluted share, in fiscal 2013. The full year 2014 had a loss from special items of $(0.5) million, or $(0.01) per diluted share, while fiscal 2013 had gains from special items of $10.6 million, or $0.13 per diluted share.

Fourth Quarter Results Compared to Prior Period
Revenues for the fiscal fourth quarter ended January 3, 2015, were $454.1 million, a decrease of $12.9 million, or 3%, on a comparable basis to fourth quarter 2013 when adjusting for the 14th week in the quarter. The decline was $32.2 million, or 7%, compared to $486.3 million in the fiscal fourth quarter ended January 4, 2014, when not adjusted for the additional week. Overall, comparable same center revenues were down for the quarter primarily due to structural unit volume decreases in lumber and rebar products.

Gross profit in the fiscal fourth quarter 2014 was $49.8 million, down $4.5 million, or 8%, compared to the fiscal fourth quarter 2013. Comparable gross profit on a same center basis for the fourth quarter decreased by $2.4 million compared to the fourth quarter 2013. Gross margin decreased 20 basis points in fiscal fourth quarter 2014, to 11.0% from 11.2% in the fiscal fourth quarter 2013, primarily due to a drop in lumber prices.

Adjusted EBITDA for the fiscal fourth quarter 2014 improved to $1.9 million from an Adjusted EBITDA loss of $(1.0) million for the same period a year ago.

The Company recorded a net loss of $7.6 million, or $(0.09) per diluted share, in the fiscal fourth quarter 2014 versus a loss in fiscal fourth quarter 2013 of $2.5 million, or $(0.03) per diluted share. The 2013 fourth quarter net loss included a non-cash, tax benefit of $8.0 million associated with the Company's pension plan.

The Company's Adjusted EBITDA for the fiscal fourth quarter and fiscal year ended 2014 and 2013, are shown in the following table:

BlueLinx Holdings Inc.
 
 
 
 
 
 
 
 
Unaudited reconciliation of GAAP net income (loss) to Non-GAAP Adjusted EBITDA (in millions)  (1)
 
 
 
 
 
 
 
 
 
 
Fiscal 
 Q4 2014
 
Fiscal 
 Q4 2013
 
Fiscal 
 2014 YTD
 
Fiscal 
 2013 YTD
GAAP net income (loss)
 
$
(7.6
)
 
$
(2.5
)
 
$
(13.9
)
 
$
(40.6
)
Adjustments:
 
 
 
 
 
 
 
 
Depreciation and amortization
 
2.3

 
2.6

 
9.5

 
9.1

Interest expense
 
6.7

 
7.0

 
26.8

 
28.0

Provision for (benefit from) income taxes
 
0.3

 
(8.3
)
 
$
0.3

 
(9.0
)
Loss from closed distribution centers
 
—

 
—

 
—

 
3.7

Gain from the sale of properties
 
—

 
(1.3
)
 
(5.3
)
 
(5.2
)
Share-based compensation expense, excluding restructuring
 
0.6

 
0.4

 
2.4

 
3.2

Restructuring, severance, debt fees, and other
 
(0.4
)
 
1.1

 
4.8

 
12.1

Adjusted EBITDA same center
 
$
1.9

 
$
(1.0
)
 
$
24.6

 
$
1.3


(1) Immaterial rounding adjustments and differences may exist between tables and previously issued presentations.

Liquidity and Capital Resources
As of January 3, 2015, the Company had $60 million of excess availability under its asset-backed revolving credit facilities, based on qualifying inventory and receivables.


2


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# 21238432. 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 website, 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.

Adjusted EBITDA is a non-GAAP measure that management uses to evaluate the performance of the Company. Adjusted EBITDA, as we define it, is an amount equal to net income (loss) plus interest expense and related items, income taxes, stock compensation, depreciation and amortization, further adjusted to exclude other non-cash items and certain other adjustments. Adjusted EBITDA is presented herein because we believe it is a useful supplement to cash flow from operations in understanding cash flows generated from operations that are available for debt service (interest and principal payments) and further investment in acquisitions. However, Adjusted EBITDA is not a presentation made in accordance with GAAP, and is not intended to present a superior measure of the financial condition from those determined under GAAP.

About BlueLinx Holdings Inc.
BlueLinx Holdings Inc., operating through its wholly owned subsidiary BlueLinx Corporation, is a leading distributor of building products in North America. The Company is headquartered in Atlanta, Georgia and operates its distribution business through its network of 49 distribution centers as of January 3, 2015. BlueLinx is traded on the New York Stock Exchange under the symbol BXC. Additional information about BlueLinx can be found on its website 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 guidance regarding anticipated financial results. 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 prices, supply and/or demand for products that it distributes, general economic and business conditions in the United States; the activities of competitors; changes in significant operating expenses; changes in the availability of capital and interest rates; adverse weather patterns or conditions; acts of cyber intrusion; variations in the performance of the financial markets, including the credit markets; and other factors described in the “Risk Factors” section in the Company’s Annual Report on Form 10-K for the year ended January 3, 2015, 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, and changes in expectation or otherwise, except as required by law.

- Tables to Follow -


3


BLUELINX HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)

 
Three Months Ended 
 January 3, 2015
 
Three Months Ended 
 January 4, 2014
 
Twelve Months Ended 
 January 3, 2015
 
Twelve Months Ended 
 January 4, 2014
 
(unaudited)
 
(unaudited)
 
 
Net sales
$
454,110

 
$
486,275

 
$
1,979,393

 
$
2,151,972

Cost of sales
404,295

 
431,927

 
1,750,289

 
1,923,489

Gross profit
49,815

 
54,348

 
229,104

 
228,483

Operating expenses:
 
 
 
 
 

 
 

Selling, general, and administrative
48,088

 
55,483

 
206,095

 
240,667

Depreciation and amortization
2,297

 
2,571

 
9,473

 
9,117

Total operating expenses
50,385

 
58,054

 
215,568

 
249,784

Operating income (loss)
(570
)
 
(3,706
)
 
13,536

 
(21,301
)
Non-operating expenses (income):
 
 
 
 
 

 
 

Interest expense
6,681

 
6,998

 
26,771

 
28,024

Other expense (income), net
12

 
50

 
325

 
306

Income (loss) before provision for (benefit from) income taxes
(7,263
)
 
(10,754
)
 
(13,560
)
 
(49,631
)
Provision for (benefit from) income taxes
377

 
(8,297
)
 
312

 
(9,013
)
Net income (loss)
$
(7,640
)
 
$
(2,457
)
 
$
(13,872
)
 
$
(40,618
)
Basic and diluted weighted average number of common shares outstanding
86,545

 
84,818

 
86,001

 
80,163

Basic and diluted net income (loss) per share applicable to common stock
$
(0.09
)
 
$
(0.03
)
 
$
(0.16
)
 
$
(0.51
)



4


BLUELINX HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
 
 
January 3, 2015
 
January 4, 2014
Assets:
 (unaudited)
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
4,522

 
$
5,034

Receivables, net
144,537

 
150,297

Inventories, net
242,546

 
223,580

Other current assets
23,289

 
22,814

Total current assets
414,894

 
401,725

Property, plant, and equipment:
 

 
 

Land and land improvements
41,095

 
41,176

Buildings
90,161

 
90,082

Machinery and equipment
77,279

 
73,004

Construction in progress
1,188

 
3,028

Property, plant, and equipment, at cost
209,723

 
207,290

Accumulated depreciation
(104,456
)
 
(96,171
)
Property, plant, and equipment, net
105,267

 
111,119

Non-current deferred income tax assets, net
501

 
824

Other non-current assets
18,320

 
14,821

Total assets
$
538,982

 
$
528,489

Liabilities:
 

 
 

Current liabilities:
 

 
 

Accounts payable
$
67,291

 
$
60,363

Bank overdrafts
27,280

 
19,377

Accrued compensation
5,643

 
4,173

Current maturities of long-term debt
2,679

 
9,141

Deferred income taxes, net
518

 
823

Other current liabilities
13,831

 
12,949

Total current liabilities
117,242

 
106,826

Non-current liabilities:
 

 
 

Long-term debt
403,274

 
387,238

Other non-current liabilities
54,492

 
40,323

Total liabilities
575,008

 
534,387

Stockholders’ deficit:
 

 
 

Common Stock
888

 
866

Additional paid-in capital
253,051

 
251,150

Accumulated other comprehensive income (loss)
(34,425
)
 
(16,293
)
Accumulated deficit
(255,540
)
 
(241,621
)
Total stockholders’ deficit
(36,026
)
 
(5,898
)
Total liabilities and stockholders’ deficit
$
538,982

 
$
528,489



5


BLUELINX HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 
 
Fiscal Year Ended
January 3, 2015
 
Fiscal Year Ended
January 4, 2014
Cash flows from operating activities:
 (unaudited)
 
 
Net income (loss)
$
(13,872
)
 
$
(40,618
)
Adjustments to reconcile net loss to net cash used in operations:
 

 
 

Depreciation and amortization
9,473

 
9,117

Amortization of debt issuance costs
3,156

 
3,184

Write-off of debt issuance costs
—

 
119

Gain from the sale of properties
(5,251
)
 
(5,220
)
  Vacant property charges, net
—

 
1,321

Severance charges
2,067

 
5,607

Payments on modification on lease agreement
—

 
(300
)
Deferred income tax benefit
17

 
(5
)
Restructuring payments
(2,805
)
 
(3,057
)
Intraperiod income tax allocation related to the hourly pension plan
—

 
(8,894
)
Pension expense
901

 
4,591

Share-based compensation expense, excluding restructuring related
3,840

 
3,222

Share-based compensation expense, restructuring related
—

 
2,895

Increase in restricted cash related to insurance and other
(263
)
 
(1,810
)
Increase in prepaid assets
(942
)
 
(3,062
)
Accrued compensation and other
(2,442
)
 
(3,033
)
Change in net cash from other operating activities
(6,121
)
 
(35,943
)
Changes in primary working capital components:
 

 
 

Receivables
5,760

 
7,168

Inventories
(18,966
)
 
6,479

Accounts payable
7,026

 
(17,585
)
Net cash used in operating activities
(12,301
)
 
(39,881
)
Cash flows from investing activities:
 

 
 

Property, plant, and equipment investments
(3,016
)
 
(4,912
)
Proceeds from disposition of assets
7,368

 
10,365

Net cash provided by investing activities
4,352

 
5,453

Cash flows from financing activities:
 

 
 

Excess tax benefits from share-based compensation arrangements
(16
)
 
16

Repurchase of shares to satisfy employee tax withholdings
(957
)
 
(3,192
)
Repayments on the revolving credit facilities
(476,473
)
 
(560,186
)
Borrowings from the revolving credit facilities
494,794

 
599,968

Payments of principal on mortgage
(9,220
)
 
(19,038
)
Payments on capital lease obligations
(2,228
)
 
(3,142
)
Increase (decrease) in bank overdrafts
7,902

 
(16,007
)
Decrease in restricted cash related to the mortgage
(6,066
)
 
40

Debt issuance costs
(201
)
 
(2,900
)
Proceeds from (payments on) stock offering, less expenses paid
(98
)
 
38,715

Net cash provided by financing activities
7,437

 
34,274

Increase in cash
(512
)
 
(154
)
Balance, beginning of period
5,034

 
5,188

Balance, end of period
$
4,522

 
$
5,034



6


BLUELINX HOLDINGS INC.
RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP ADJUSTED EBITDA
(In thousands)
(unaudited)

 
 
Fiscal 
 Q4 2014
 
Fiscal 
 Q4 2013
 
Fiscal 
 2014 YTD
 
Fiscal 
 2013 YTD
GAAP net income (loss)
 
$
(7,640
)
 
$
(2,457
)
 
$
(13,872
)
 
$
(40,618
)
Adjustments:
 
 
 
 
 
 
 
 
Depreciation and amortization
 
2,297

 
2,571

 
9,473

 
9,117

Interest expense
 
6,681

 
6,998

 
26,771

 
28,024

Provision for (benefit from) income taxes
 
377

 
(8,297
)
 
312

 
(9,013
)
Loss from closed distribution centers
 
—

 
—

 
—

 
3,689

Gain from the sale of properties
 
—

 
(1,311
)
 
(5,251
)
 
(5,220
)
Share-based compensation expense, excluding restructuring
 
579

 
356

 
2,351

 
3,222

Restructuring, severance, debt fees, and other
 
(434
)
 
1,167

 
4,799

 
12,123

Adjusted EBITDA same center
 
1,860


(973
)

24,583


1,324

Add back EBITDA loss week of December 29, 2013
 
—

 
1,081

 
—

 
1,081

Comparable 13/52 week vs. 13/52 week
 
$
1,860


$
108


$
24,583


$
2,405


7


BLUELINX HOLDINGS INC.
COMPARABLE SAME CENTER SCHEDULE
(In thousands)
(unaudited)

 
 
Fiscal 
 Q4 2014
 
Fiscal 
 Q4 2013
 
Fiscal 
 2014 YTD
 
Fiscal 
 2013 YTD
Net sales
 
$
454,110

 
$
486,275

 
$
1,979,393

 
$
2,151,972

 Less: closed centers
 
—

 
—

 
—

 
85,578

Same center net sales
 
454,110


486,275


1,979,393


2,066,394

 Less week of December 29, 2013 (1)
 
—

 
19,219

 
—

 
19,219

Comparable 13/52 week vs. 13/52 week
 
$
454,110


$
467,056


$
1,979,393


$
2,047,175

 
 
 
 
 
 
 
 
 
Actual year-over-year percentage decrease
 
(6.6
)%
 
 
 
(8.0
)%
 
 
Same center year-over-year percentage decrease
 
(6.6
)%
 
 
 
(4.2
)%
 
 
Comparable year-over-year percentage decrease
 
(2.8
)%
 
 
 
(3.3
)%
 
 
 
 
 
 
 
 
 
 
 
Gross profit
 
$
49,815

 
$
54,348

 
$
229,104

 
$
228,483

 Less: closed centers
 
—

 
—

 
—

 
6,294

Same center gross profit
 
49,815


54,348


229,104


222,189

 Less week of December 29, 2013 (1)
 
—

 
2,087

 
—

 
2,087

Comparable 13/52 week vs. 13/52 week
 
$
49,815


$
52,261


$
229,104


$
220,102

 
 
 
 
 
 
 
 
 
Total operating expenses
 
$
50,385

 
$
58,054

 
$
215,568

 
$
249,784

 Less: closed centers
 
—

 
—

 
—

 
9,983

Same center operating expenses
 
50,385


58,054


215,568


239,801

 Less week of December 29, 2013 (1)
 
—

 
3,345

 
—

 
3,345

Comparable 13/52 week vs. 13/52 week
 
$
50,385


$
54,709


$
215,568


$
236,456

 
 


 


 


 


Operating income (loss)
 
$
(570
)
 
$
(3,706
)
 
$
13,536

 
$
(21,301
)
Add back loss from closed centers
 
—

 
—

 
—

 
3,689

Same center operating income (loss)
 
(570
)

(3,706
)

13,536


(17,612
)

(1) Based on actual shipments for week ending January 4, 2014.

8