| Boise Cascade Company | Exhibit 99.1 | ||||
| 1111 West Jefferson Street, Suite 300 | |||||
| Boise, ID 83702 | |||||
| News Release |  | ||||
Investor Relations Contact - Kelly Hibbs investor@bc.com | Media Contact - Lisa Tschampl mediarelations@bc.com | |||||||
For Immediate Release: October 30, 2023
Boise Cascade Company Reports Third Quarter 2023 Results
BOISE, Idaho - Boise Cascade Company ("Boise Cascade," the "Company," "we," or "our") (NYSE: BCC) today reported net income of $143.1 million, or $3.58 per share, on sales of $1.8 billion for the third quarter ended September 30, 2023, compared with net income of $219.6 million, or $5.52 per share, on sales of $2.2 billion for the third quarter ended September 30, 2022.
“After another solid quarter of operating and financial performance, I want to first thank our associates for their continued focus, hard work, and loyalty. In addition, we are pleased to have recently completed the acquisition of BROSCO and welcome their outstanding team to Boise Cascade. The acquisition supports BMD's growth in the door and millwork business and brings us immediate scale in the Northeast markets,” stated Nate Jorgensen, CEO. “The strength and flexibility of our balance sheet allows us to remain committed to our reinvestment and growth strategies while also rewarding our shareholders, as evidenced by our most recent special dividend announcement. As we look forward to 2024, we are dedicated to supporting our vendor and customer partners and appreciate their ongoing confidence and trust in us. We are well positioned to navigate market uncertainties as near-term demand for new residential construction evolves.”
Third Quarter 2023 Highlights
| 3Q 2023 | 3Q 2022 | % change | ||||||||||||||||||
| (in thousands, except per-share data and percentages) | ||||||||||||||||||||
| Consolidated Results | ||||||||||||||||||||
| Sales | $ | 1,834,441 | $ | 2,154,647 | (15) | % | ||||||||||||||
| Net income | 143,068 | 219,587 | (35) | % | ||||||||||||||||
| Net income per common share - diluted | 3.58 | 5.52 | (35) | % | ||||||||||||||||
Adjusted EBITDA 1 | 216,465 | 326,029 | (34) | % | ||||||||||||||||
| Segment Results | ||||||||||||||||||||
| Wood Products sales | $ | 515,225 | $ | 595,320 | (13) | % | ||||||||||||||
| Wood Products income | 99,574 | 155,972 | (36) | % | ||||||||||||||||
Wood Products EBITDA 1 | 122,924 | 177,257 | (31) | % | ||||||||||||||||
| Building Materials Distribution sales | 1,670,296 | 1,956,802 | (15) | % | ||||||||||||||||
| Building Materials Distribution income | 97,076 | 154,436 | (37) | % | ||||||||||||||||
Building Materials Distribution EBITDA 1 | 104,857 | 161,196 | (35) | % | ||||||||||||||||
1 For reconciliations of non-GAAP measures, see summary notes at the end of this press release.
In third quarter 2023, total U.S. housing starts decreased 6%, driven by a decrease in multi-family housing starts compared to the same period in 2022. However, single-family housing starts increased 7% compared to the same period in 2022. On a year-to-date basis through September 2023, total housing starts and single-family housing starts decreased 12% and 13%, respectively, compared to the same period in 2022. Single-family housing starts are the key demand driver for our sales.
Wood Products
Wood Products' sales, including sales to Building Materials Distribution (BMD), decreased $80.1 million, or 13%, to $515.2 million for the three months ended September 30, 2023, from $595.3 million for the three months ended September 30, 2022. The decrease in sales was driven by lower plywood sales prices, lower sales prices for I-joists and LVL (collectively referred to as EWP), and lower LVL sales volumes. These decreases were offset partially by higher plywood sales volumes.
Comparative average net selling prices and sales volume changes for EWP and plywood are as follows:
| 3Q 2023 vs. 3Q 2022 | 3Q 2023 vs. 2Q 2023 | |||||||||||||
| Average Net Selling Prices | ||||||||||||||
| LVL | (14)% | (4)% | ||||||||||||
| I-joists | (16)% | (3)% | ||||||||||||
| Plywood | (20)% | 5% | ||||||||||||
| Sales Volumes | ||||||||||||||
| LVL | (5)% | 6% | ||||||||||||
| I-joists | —% | 2% | ||||||||||||
| Plywood | 19% | (11)% | ||||||||||||
Wood Products' segment income decreased $56.4 million to $99.6 million for the three months ended September 30, 2023, from $156.0 million for the three months ended September 30, 2022. The decrease in segment income was due primarily to lower EWP and plywood sales prices, as well as lower LVL sales volumes. These decreases in segment income were offset partially by lower wood fiber costs and higher plywood sales volumes.
Building Materials Distribution
BMD's sales decreased $286.5 million, or 15%, to $1,670.3 million for the three months ended September 30, 2023, from $1,956.8 million for the three months ended September 30, 2022. Compared with the same quarter in the prior year, the overall decrease in sales was driven by sales price and sales volume decreases of 14% and 1%, respectively. By product line, commodity sales decreased 20%, general line product sales decreased 5%, and EWP sales (substantially all of which are sourced through our Wood Products segment) decreased 21%.
BMD segment income decreased $57.3 million to $97.1 million for the three months ended September 30, 2023, from $154.4 million in the comparative prior year quarter. The decline in segment income was driven by a gross margin decrease of $48.4 million, resulting primarily from lower margins on EWP. In addition, selling and distribution expenses increased $6.0 million.
2
Recent Developments
On October 2, 2023, the Company completed the acquisition of Brockway-Smith Company (BROSCO) for a purchase price of $168 million, inclusive of estimated working capital at closing of $51 million, which is subject to post-closing adjustments. The Company funded the acquisition and related costs with cash on hand.
Balance Sheet and Liquidity
Boise Cascade ended third quarter 2023 with $1,273.0 million of cash and cash equivalents and $395.9 million of undrawn committed bank line availability, for total available liquidity of $1,668.9 million. The Company had $445.1 million of outstanding debt at September 30, 2023.
Capital Allocation
Excluding acquisitions, we expect capital expenditures in 2023 to total approximately $190 million to $210 million. Our 2023 capital expenditures range includes funding for greenfield distribution centers in South Carolina and Texas, projects at our mills in the southeast to expand our EWP capacity, spending related to new door shop assembly operations in Kansas City, Missouri, and Denver, Colorado, and the purchase of a distribution center in West Palm Beach, Florida.
For the nine months ended September 30, 2023, the Company paid common stock dividends of $140.9 million. In addition, on October 26, 2023, our board of directors declared quarterly and special dividends of $0.20 per share and $5.00 per share, respectively, on our common stock. The fourth quarter dividends will total approximately $206 million and are payable on December 15, 2023, to stockholders of record on December 1, 2023.
As of September 30, 2023, approximately 2.0 million shares were available for repurchase under our existing share repurchase program.
Outlook
Demand for the products we manufacture, as well as the products we purchase and distribute, is correlated with new residential construction, residential repair-and-remodeling activity and light commercial construction. Various industry forecasts for 2023 U.S. housing starts are estimated to be 1.4 million units, compared with actual housing starts of 1.55 million in 2022, as reported by the U.S. Census Bureau. Throughout 2023, home affordability has been a challenge for consumers given higher mortgage rates and limited home price decreases. However, given a resilient economy and low levels of existing home inventory for sale, demand for new residential construction has been stronger than anticipated. Homebuilders have also addressed affordability challenges facing homebuyers in various ways, including smaller home sizes, fewer amenities, price incentives, and mortgage rate buydowns. Economic uncertainties, escalating mortgage rates, and home affordability are expected to continue to influence the near-term demand environment. Consensus forecasts for 2024 single- and multi-family housing starts in the U.S. generally range from 1.3 million to 1.4 million units, which is comparable with 2023. Regarding home improvement spending, the age of U.S. housing stock and elevated levels of homeowner equity have provided a favorable backdrop for repair-and-remodel spending. However, industry forecasts project continued moderation of year-over-year growth in renovation spending, and economic uncertainty may also negatively impact homeowners' further investment in their residences.
As a manufacturer of certain commodity products, we have sales and profitability exposure to declines in commodity product prices and rising input costs. Our distribution business purchases and resells a broad mix of commodity products with periods of increasing prices providing the opportunity for higher sales and increased margins, while declining price environments expose us to declines in sales and profitability. Future commodity product pricing and commodity input costs may be volatile in response to economic uncertainties, industry operating rates, transportation constraints or disruptions, net import and export activity, inventory levels in various distribution channels, and seasonal demand patterns. During fourth quarter 2023, we expect to experience seasonally slower demand for the products we manufacture and distribute, as well as modest EWP price erosion.
3
About Boise Cascade
Boise Cascade Company is one of the largest producers of engineered wood products and plywood in North America and a leading U.S. wholesale distributor of building products. For more information, please visit the Company's website at www.bc.com.
Webcast and Conference Call
Boise Cascade will host a webcast and conference call to discuss third quarter earnings on Tuesday, October 31, 2023, at 11 a.m. Eastern.
To join the webcast, go to the Investors section of our website at www.bc.com/investors and select the Event Calendar link. Analysts and investors who wish to ask questions during the Q&A session can register for the call here.
The archived webcast will be available in the Investors section of Boise Cascade's website.
Use of Non-GAAP Financial Measures
We refer to the terms EBITDA and Adjusted EBITDA in this earnings release and the accompanying Quarterly Statistical Information as supplemental measures of our performance and liquidity that are not required by or presented in accordance with generally accepted accounting principles in the United States (GAAP). We define EBITDA as income (loss) before interest (interest expense and interest income), income taxes, and depreciation and amortization. Additionally, we disclose Adjusted EBITDA, which further adjusts EBITDA to exclude the change in fair value of interest rate swaps.
We believe EBITDA and Adjusted EBITDA are meaningful measures because they present a transparent view of our recurring operating performance and allow management to readily view operating trends, perform analytical comparisons, and identify strategies to improve operating performance. We also believe EBITDA and Adjusted EBITDA are useful to investors because they provide a means to evaluate the operating performance of our segments and our Company on an ongoing basis using criteria that are used by our management and because they are frequently used by investors and other interested parties when comparing companies in our industry that have different financing and capital structures and/or tax rates. EBITDA and Adjusted EBITDA, however, are not measures of our liquidity or financial performance under GAAP and should not be considered as alternatives to net income (loss), income (loss) from operations, or any other performance measure derived in accordance with GAAP or as alternatives to cash flow from operating activities as a measure of our liquidity. The use of EBITDA and Adjusted EBITDA instead of net income (loss) or segment income (loss) have limitations as analytical tools, including: the inability to determine profitability; the exclusion of interest expense, interest income, and associated significant cash requirements; and the exclusion of depreciation and amortization, which represent unavoidable operating costs. Management compensates for these limitations by relying on our GAAP results. Our measures of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation.
4
Forward-Looking Statements
This press release includes statements about our expectations of future operational and financial performance that are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, but not limited to, statements regarding our outlook. Statements preceded or followed by, or that otherwise include, the words "believes," "expects," "anticipates," "intends," "project," "estimates," "plans," "forecast," "is likely to," and similar expressions or future or conditional verbs such as "will," "may," "would," "should," and "could" are generally forward-looking in nature and not historical facts. Such statements are based upon the current beliefs and expectations of our management and are subject to significant risks and uncertainties. The accuracy of such statements is subject to a number of risks, uncertainties, and assumptions that could cause our actual results to differ materially from those projected, including, but not limited to, prices for building products, changes in the competitive position of our products, commodity input costs, the effect of general economic conditions, our ability to efficiently and effectively integrate the BROSCO acquisition, mortgage rates and availability, housing demand, housing vacancy rates, governmental regulations, unforeseen production disruptions, as well as natural disasters. These and other factors that could cause actual results to differ materially from such forward-looking statements are discussed in greater detail in our filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date of this press release. We undertake no obligation to revise them in light of new information. Finally, we undertake no obligation to review or confirm analyst expectations or estimates that might be derived from this release.
5
Boise Cascade Company
Consolidated Statements of Operations
(in thousands, except per-share data) (unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30 | June 30, 2023 | September 30 | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||
| Sales | $ | 1,834,441 | $ | 2,154,647 | $ | 1,815,219 | $ | 5,193,989 | $ | 6,759,001 | |||||||||||||||||||
| Costs and expenses | |||||||||||||||||||||||||||||
| Materials, labor, and other operating expenses (excluding depreciation) | 1,442,178 | 1,655,979 | 1,426,436 | 4,099,249 | 5,183,823 | ||||||||||||||||||||||||
| Depreciation and amortization | 31,474 | 28,374 | 30,722 | 93,382 | 69,611 | ||||||||||||||||||||||||
| Selling and distribution expenses | 147,714 | 142,176 | 139,205 | 415,707 | 423,106 | ||||||||||||||||||||||||
| General and administrative expenses | 27,583 | 27,622 | 30,147 | 84,193 | 81,375 | ||||||||||||||||||||||||
| Other (income) expense, net | (141) | 1,126 | (1,266) | (1,752) | (987) | ||||||||||||||||||||||||
| 1,648,808 | 1,855,277 | 1,625,244 | 4,690,779 | 5,756,928 | |||||||||||||||||||||||||
| Income from operations | 185,633 | 299,370 | 189,975 | 503,210 | 1,002,073 | ||||||||||||||||||||||||
| Foreign currency exchange gain (loss) | (602) | (1,674) | 320 | (355) | (2,041) | ||||||||||||||||||||||||
| Pension expense (excluding service costs) | (40) | (41) | (41) | (122) | (253) | ||||||||||||||||||||||||
| Interest expense | (6,351) | (6,398) | (6,339) | (19,051) | (18,969) | ||||||||||||||||||||||||
| Interest income | 13,760 | 3,238 | 11,519 | 34,964 | 4,688 | ||||||||||||||||||||||||
| Change in fair value of interest rate swaps | (327) | 1,134 | 333 | (798) | 3,594 | ||||||||||||||||||||||||
| 6,440 | (3,741) | 5,792 | 14,638 | (12,981) | |||||||||||||||||||||||||
| Income before income taxes | 192,073 | 295,629 | 195,767 | 517,848 | 989,092 | ||||||||||||||||||||||||
| Income tax provision | (49,005) | (76,042) | (49,447) | (131,727) | (248,794) | ||||||||||||||||||||||||
| Net income | $ | 143,068 | $ | 219,587 | $ | 146,320 | $ | 386,121 | $ | 740,298 | |||||||||||||||||||
| Weighted average common shares outstanding: | |||||||||||||||||||||||||||||
| Basic | 39,675 | 39,544 | 39,675 | 39,648 | 39,521 | ||||||||||||||||||||||||
| Diluted | 39,983 | 39,776 | 39,834 | 39,849 | 39,762 | ||||||||||||||||||||||||
| Net income per common share: | |||||||||||||||||||||||||||||
| Basic | $ | 3.61 | $ | 5.55 | $ | 3.69 | $ | 9.74 | $ | 18.73 | |||||||||||||||||||
| Diluted | $ | 3.58 | $ | 5.52 | $ | 3.67 | $ | 9.69 | $ | 18.62 | |||||||||||||||||||
| Dividends declared per common share | $ | 0.20 | $ | 0.12 | $ | 3.15 | $ | 3.50 | $ | 2.86 | |||||||||||||||||||
6
Wood Products Segment
Statements of Operations
(in thousands, except percentages) (unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30 | June 30, 2023 | September 30 | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||
| Segment sales | $ | 515,225 | $ | 595,320 | $ | 530,273 | $ | 1,482,926 | $ | 1,690,294 | |||||||||||||||||||
| Costs and expenses | |||||||||||||||||||||||||||||
| Materials, labor, and other operating expenses (excluding depreciation) | 376,754 | 398,008 | 387,407 | 1,091,900 | 1,093,274 | ||||||||||||||||||||||||
| Depreciation and amortization | 23,350 | 21,285 | 23,005 | 70,145 | 48,578 | ||||||||||||||||||||||||
| Selling and distribution expenses | 10,786 | 11,164 | 11,437 | 33,901 | 30,743 | ||||||||||||||||||||||||
| General and administrative expenses | 5,018 | 7,717 | 5,364 | 15,560 | 18,189 | ||||||||||||||||||||||||
| Other (income) expense, net | (257) | 1,174 | (975) | (1,584) | (679) | ||||||||||||||||||||||||
| 415,651 | 439,348 | 426,238 | 1,209,922 | 1,190,105 | |||||||||||||||||||||||||
| Segment income | $ | 99,574 | $ | 155,972 | $ | 104,035 | $ | 273,004 | $ | 500,189 | |||||||||||||||||||
| (percentage of sales) | |||||||||||||||||||||||||||||
| Segment sales | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||||||
| Costs and expenses | |||||||||||||||||||||||||||||
| Materials, labor, and other operating expenses (excluding depreciation) | 73.1 | % | 66.9 | % | 73.1 | % | 73.6 | % | 64.7 | % | |||||||||||||||||||
| Depreciation and amortization | 4.5 | % | 3.6 | % | 4.3 | % | 4.7 | % | 2.9 | % | |||||||||||||||||||
| Selling and distribution expenses | 2.1 | % | 1.9 | % | 2.2 | % | 2.3 | % | 1.8 | % | |||||||||||||||||||
| General and administrative expenses | 1.0 | % | 1.3 | % | 1.0 | % | 1.0 | % | 1.1 | % | |||||||||||||||||||
| Other (income) expense, net | — | % | 0.2 | % | (0.2) | % | (0.1 | %) | — | % | |||||||||||||||||||
| 80.7 | % | 73.8 | % | 80.4 | % | 81.6 | % | 70.4 | % | ||||||||||||||||||||
| Segment income | 19.3 | % | 26.2 | % | 19.6 | % | 18.4 | % | 29.6 | % | |||||||||||||||||||
7
Building Materials Distribution Segment
Statements of Operations
(in thousands, except percentages) (unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30 | June 30, 2023 | September 30 | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||
| Segment sales | $ | 1,670,296 | $ | 1,956,802 | $ | 1,636,538 | $ | 4,686,076 | $ | 6,199,835 | |||||||||||||||||||
| Costs and expenses | |||||||||||||||||||||||||||||
| Materials, labor, and other operating expenses (excluding depreciation) | 1,417,153 | 1,655,257 | 1,391,015 | 3,983,718 | 5,221,905 | ||||||||||||||||||||||||
| Depreciation and amortization | 7,781 | 6,760 | 7,386 | 22,237 | 20,064 | ||||||||||||||||||||||||
| Selling and distribution expenses | 136,982 | 131,012 | 127,786 | 381,878 | 392,363 | ||||||||||||||||||||||||
| General and administrative expenses | 11,195 | 9,480 | 12,089 | 33,314 | 31,264 | ||||||||||||||||||||||||
| Other (income) expense, net | 109 | (143) | (288) | (382) | (397) | ||||||||||||||||||||||||
| 1,573,220 | 1,802,366 | 1,537,988 | 4,420,765 | 5,665,199 | |||||||||||||||||||||||||
| Segment income | $ | 97,076 | $ | 154,436 | $ | 98,550 | $ | 265,311 | $ | 534,636 | |||||||||||||||||||
| (percentage of sales) | |||||||||||||||||||||||||||||
| Segment sales | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||||||||
| Costs and expenses | |||||||||||||||||||||||||||||
| Materials, labor, and other operating expenses (excluding depreciation) | 84.8 | % | 84.6 | % | 85.0 | % | 85.0 | % | 84.2 | % | |||||||||||||||||||
| Depreciation and amortization | 0.5 | % | 0.3 | % | 0.5 | % | 0.5 | % | 0.3 | % | |||||||||||||||||||
| Selling and distribution expenses | 8.2 | % | 6.7 | % | 7.8 | % | 8.1 | % | 6.3 | % | |||||||||||||||||||
| General and administrative expenses | 0.7 | % | 0.5 | % | 0.7 | % | 0.7 | % | 0.5 | % | |||||||||||||||||||
| Other (income) expense, net | — | % | — | % | — | % | — | % | — | % | |||||||||||||||||||
| 94.2 | % | 92.1 | % | 94.0 | % | 94.3 | % | 91.4 | % | ||||||||||||||||||||
| Segment income | 5.8 | % | 7.9 | % | 6.0 | % | 5.7 | % | 8.6 | % | |||||||||||||||||||
8
Segment Information
(in thousands) (unaudited)
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30 | June 30, 2023 | September 30 | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||
| Segment sales | |||||||||||||||||||||||||||||
| Wood Products | $ | 515,225 | $ | 595,320 | $ | 530,273 | $ | 1,482,926 | $ | 1,690,294 | |||||||||||||||||||
| Building Materials Distribution | 1,670,296 | 1,956,802 | 1,636,538 | 4,686,076 | 6,199,835 | ||||||||||||||||||||||||
| Intersegment eliminations | (351,080) | (397,475) | (351,592) | (975,013) | (1,131,128) | ||||||||||||||||||||||||
| Total net sales | $ | 1,834,441 | $ | 2,154,647 | $ | 1,815,219 | $ | 5,193,989 | $ | 6,759,001 | |||||||||||||||||||
| Segment income | |||||||||||||||||||||||||||||
| Wood Products | $ | 99,574 | $ | 155,972 | $ | 104,035 | $ | 273,004 | $ | 500,189 | |||||||||||||||||||
| Building Materials Distribution | 97,076 | 154,436 | 98,550 | 265,311 | 534,636 | ||||||||||||||||||||||||
| Total segment income | 196,650 | 310,408 | 202,585 | 538,315 | 1,034,825 | ||||||||||||||||||||||||
| Unallocated corporate costs | (11,017) | (11,038) | (12,610) | (35,105) | (32,752) | ||||||||||||||||||||||||
| Income from operations | $ | 185,633 | $ | 299,370 | $ | 189,975 | $ | 503,210 | $ | 1,002,073 | |||||||||||||||||||
| Segment EBITDA | |||||||||||||||||||||||||||||
| Wood Products | $ | 122,924 | $ | 177,257 | $ | 127,040 | $ | 343,149 | $ | 548,767 | |||||||||||||||||||
| Building Materials Distribution | 104,857 | 161,196 | 105,936 | 287,548 | 554,700 | ||||||||||||||||||||||||
See accompanying summary notes to consolidated financial statements and segment information.
9
Boise Cascade Company
Consolidated Balance Sheets
(in thousands) (unaudited)
| September 30, 2023 | December 31, 2022 | ||||||||||
| ASSETS | |||||||||||
| Current | |||||||||||
| Cash and cash equivalents | $ | 1,272,963 | $ | 998,344 | |||||||
| Receivables | |||||||||||
Trade, less allowances of $4,190 and $3,264 | 463,086 | 297,237 | |||||||||
| Related parties | 197 | 19 | |||||||||
| Other | 15,752 | 23,023 | |||||||||
| Inventories | 683,406 | 697,551 | |||||||||
| Prepaid expenses and other | 30,839 | 47,878 | |||||||||
| Total current assets | 2,466,243 | 2,064,052 | |||||||||
| Property and equipment, net | 789,541 | 770,023 | |||||||||
| Operating lease right-of-use assets | 50,812 | 55,582 | |||||||||
| Finance lease right-of-use assets | 24,616 | 26,501 | |||||||||
| Timber deposits | 8,890 | 7,519 | |||||||||
| Goodwill | 137,958 | 137,958 | |||||||||
| Intangible assets, net | 148,651 | 161,433 | |||||||||
| Deferred income taxes | 5,831 | 6,116 | |||||||||
| Other assets | 9,891 | 11,330 | |||||||||
| Total assets | $ | 3,642,433 | $ | 3,240,514 | |||||||
10
Boise Cascade Company
Consolidated Balance Sheets (continued)
(in thousands, except per-share data) (unaudited)
| September 30, 2023 | December 31, 2022 | ||||||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
| Current | |||||||||||
| Accounts payable | |||||||||||
| Trade | $ | 403,682 | $ | 269,785 | |||||||
| Related parties | 1,599 | 1,019 | |||||||||
| Accrued liabilities | |||||||||||
| Compensation and benefits | 148,472 | 142,463 | |||||||||
| Interest payable | 5,071 | 9,955 | |||||||||
| Other | 135,900 | 122,606 | |||||||||
| Total current liabilities | 694,724 | 545,828 | |||||||||
| Debt | |||||||||||
| Long-term debt | 445,058 | 444,392 | |||||||||
| Other | |||||||||||
| Compensation and benefits | 36,466 | 33,226 | |||||||||
| Operating lease liabilities, net of current portion | 44,418 | 48,668 | |||||||||
| Finance lease liabilities, net of current portion | 28,590 | 30,022 | |||||||||
| Deferred income taxes | 67,535 | 63,454 | |||||||||
| Other long-term liabilities | 18,047 | 16,949 | |||||||||
| 195,056 | 192,319 | ||||||||||
| Commitments and contingent liabilities | |||||||||||
| Stockholders' equity | |||||||||||
Preferred stock, $0.01 par value per share; 50,000 shares authorized, no shares issued and outstanding | — | — | |||||||||
Common stock, $0.01 par value per share; 300,000 shares authorized, 44,983 and 44,827 shares issued, respectively | 450 | 448 | |||||||||
Treasury stock, 5,393 and 5,367 shares at cost, respectively | (140,448) | (138,909) | |||||||||
Additional paid-in capital | 556,805 | 551,215 | |||||||||
Accumulated other comprehensive loss | (501) | (520) | |||||||||
| Retained earnings | 1,891,289 | 1,645,741 | |||||||||
| Total stockholders' equity | 2,307,595 | 2,057,975 | |||||||||
| Total liabilities and stockholders' equity | $ | 3,642,433 | $ | 3,240,514 | |||||||
11
Boise Cascade Company
Consolidated Statements of Cash Flows
(in thousands) (unaudited)
| Nine Months Ended September 30 | |||||||||||
| 2023 | 2022 | ||||||||||
| Cash provided by (used for) operations | |||||||||||
| Net income | $ | 386,121 | $ | 740,298 | |||||||
| Items in net income not using (providing) cash | |||||||||||
Depreciation and amortization, including deferred financing costs and other | 95,516 | 71,213 | |||||||||
| Stock-based compensation | 11,518 | 8,690 | |||||||||
| Pension expense | 122 | 253 | |||||||||
| Deferred income taxes | 4,351 | 45,365 | |||||||||
| Change in fair value of interest rate swaps | 798 | (3,594) | |||||||||
| Other | (1,877) | (830) | |||||||||
| Decrease (increase) in working capital, net of acquisitions | |||||||||||
| Receivables | (158,756) | (51,027) | |||||||||
| Inventories | 14,145 | (83,539) | |||||||||
| Prepaid expenses and other | (6,604) | (5,901) | |||||||||
| Accounts payable and accrued liabilities | 152,303 | 78,444 | |||||||||
| Pension contributions | (403) | (922) | |||||||||
| Income taxes payable | 23,664 | 14,970 | |||||||||
| Other | 231 | 705 | |||||||||
| Net cash provided by operations | 521,129 | 814,125 | |||||||||
| Cash provided by (used for) investment | |||||||||||
| Expenditures for property and equipment | (99,251) | (61,835) | |||||||||
| Acquisitions of businesses and facilities | — | (516,881) | |||||||||
| Proceeds from sales of assets and other | 2,450 | 3,094 | |||||||||
| Net cash used for investment | (96,801) | (575,622) | |||||||||
| Cash provided by (used for) financing | |||||||||||
| Dividends paid on common stock | (140,885) | (114,025) | |||||||||
| Tax withholding payments on stock-based awards | (5,926) | (3,930) | |||||||||
| Treasury stock purchased | (1,539) | — | |||||||||
| Payments of deferring financing costs | — | (1,170) | |||||||||
| Other | (1,359) | (1,221) | |||||||||
| Net cash used for financing | (149,709) | (120,346) | |||||||||
| Net increase in cash and cash equivalents | 274,619 | 118,157 | |||||||||
| Balance at beginning of the period | 998,344 | 748,907 | |||||||||
| Balance at end of the period | $ | 1,272,963 | $ | 867,064 | |||||||
12
Summary Notes to Consolidated Financial Statements and Segment Information
The Consolidated Statements of Operations, Segment Statements of Operations, Consolidated Balance Sheets, Consolidated Statements of Cash Flows, and Segment Information presented herein do not include the notes accompanying the Company's Consolidated Financial Statements and should be read in conjunction with the Company’s 2022 Form 10-K and the Company's other filings with the Securities and Exchange Commission. Net income for all periods presented involved estimates and accruals.
EBITDA represents income before interest (interest expense and interest income), income taxes, and depreciation and amortization. Additionally, we disclose Adjusted EBITDA, which further adjusts EBITDA to exclude the change in fair value of interest rate swaps. The following table reconciles net income to EBITDA and Adjusted EBITDA for (i) the three months ended September 30, 2023 and 2022, (ii) the three months ended June 30, 2023, and (iii) the nine months ended September 30, 2023 and 2022:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30 | June 30, 2023 | September 30 | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
| Net income | $ | 143,068 | $ | 219,587 | $ | 146,320 | $ | 386,121 | $ | 740,298 | |||||||||||||||||||
| Interest expense | 6,351 | 6,398 | 6,339 | 19,051 | 18,969 | ||||||||||||||||||||||||
| Interest income | (13,760) | (3,238) | (11,519) | (34,964) | (4,688) | ||||||||||||||||||||||||
| Income tax provision | 49,005 | 76,042 | 49,447 | 131,727 | 248,794 | ||||||||||||||||||||||||
| Depreciation and amortization | 31,474 | 28,374 | 30,722 | 93,382 | 69,611 | ||||||||||||||||||||||||
| EBITDA | 216,138 | 327,163 | 221,309 | 595,317 | 1,072,984 | ||||||||||||||||||||||||
| Change in fair value of interest rate swaps | 327 | (1,134) | (333) | 798 | (3,594) | ||||||||||||||||||||||||
| Adjusted EBITDA | $ | 216,465 | $ | 326,029 | $ | 220,976 | $ | 596,115 | $ | 1,069,390 | |||||||||||||||||||
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The following table reconciles segment income and unallocated corporate costs to EBITDA and adjusted EBITDA for the (i) three months ended September 30, 2023 and 2022, (ii) three months ended June 30, 2023, and (iii) nine months ended September 30, 2023 and 2022:
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||||
| September 30 | June 30, 2023 | September 30 | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||
| Wood Products | |||||||||||||||||||||||||||||
| Segment income | $ | 99,574 | $ | 155,972 | $ | 104,035 | $ | 273,004 | $ | 500,189 | |||||||||||||||||||
| Depreciation and amortization | 23,350 | 21,285 | 23,005 | 70,145 | 48,578 | ||||||||||||||||||||||||
| EBITDA | $ | 122,924 | $ | 177,257 | $ | 127,040 | $ | 343,149 | $ | 548,767 | |||||||||||||||||||
| Building Materials Distribution | |||||||||||||||||||||||||||||
| Segment income | $ | 97,076 | $ | 154,436 | $ | 98,550 | $ | 265,311 | $ | 534,636 | |||||||||||||||||||
| Depreciation and amortization | 7,781 | 6,760 | 7,386 | 22,237 | 20,064 | ||||||||||||||||||||||||
| EBITDA | $ | 104,857 | $ | 161,196 | $ | 105,936 | $ | 287,548 | $ | 554,700 | |||||||||||||||||||
| Corporate | |||||||||||||||||||||||||||||
| Unallocated corporate costs | $ | (11,017) | $ | (11,038) | $ | (12,610) | $ | (35,105) | $ | (32,752) | |||||||||||||||||||
| Foreign currency exchange gain (loss) | (602) | (1,674) | 320 | (355) | (2,041) | ||||||||||||||||||||||||
| Pension expense (excluding service costs) | (40) | (41) | (41) | (122) | (253) | ||||||||||||||||||||||||
| Change in fair value of interest rate swaps | (327) | 1,134 | 333 | (798) | 3,594 | ||||||||||||||||||||||||
| Depreciation and amortization | 343 | 329 | 331 | 1,000 | 969 | ||||||||||||||||||||||||
| EBITDA | (11,643) | (11,290) | (11,667) | (35,380) | (30,483) | ||||||||||||||||||||||||
| Change in fair value of interest rate swaps | 327 | (1,134) | (333) | 798 | (3,594) | ||||||||||||||||||||||||
| Corporate adjusted EBITDA | $ | (11,316) | $ | (12,424) | $ | (12,000) | $ | (34,582) | $ | (34,077) | |||||||||||||||||||
| Total Company adjusted EBITDA | $ | 216,465 | $ | 326,029 | $ | 220,976 | $ | 596,115 | $ | 1,069,390 | |||||||||||||||||||
14