Financial Data and Key Metrics Changes - The company generated net sales of $709 million, with adjusted EBITDA of $19.6 million, resulting in a 2.8% adjusted EBITDA margin [7][20] - Adjusted net income was $2.3 million, or $0.27 per share [22] - Total gross profit was $111 million, with a gross margin of 15.7%, down 190 basis points from the prior period [21] Business Line Data and Key Metrics Changes - Specialty Products accounted for approximately 70% of net sales but saw a nearly 5% year-over-year decline due to price deflation and volume pressure [8][23] - Specialty Products gross margin was 18.7%, down 200 basis points from the previous year [24] - Structural Products revenues increased over 3%, primarily due to significant price increases in lumber and volume increases in both lumber and panels [9][25] Market Data and Key Metrics Changes - The average lumber prices were up 13%, while panel prices were down 13% year-over-year [9] - The company noted that the housing market is facing challenges, with the lowest existing housing sales backdrop in thirty years [12] - Multifamily housing starts were significantly higher on a year-over-year basis, indicating a potential area of growth [13] Company Strategy and Development Direction - The company is focused on expanding its specialty product categories and gaining market share in engineered wood, siding, millwork, and outdoor living products [4] - Digital transformation efforts are on track, with Phase one expected to be completed by Q3 2025 [5] - The company is exploring greenfield and M&A opportunities to expand geographic reach and support specialty product sales growth [5] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing price deflation and lower volumes due to weather and macroeconomic forces but expressed optimism about future growth [4][11] - The company believes that long-term fundamentals of housing remain strong despite current market challenges [12][14] - Management indicated that while the near-term outlook is uncertain, they remain committed to their strategic priorities and long-term growth [19] Other Important Information - The company repurchased $15 million in shares during the first quarter, demonstrating a commitment to returning capital to shareholders [11][29] - The liquidity position remains strong, with cash on hand of $449 million and total available liquidity of approximately $795 million [26] Q&A Session Summary Question: Can you talk about the impacts and the associated outlook as it relates to challenges in the overall market? - Management noted competitive pricing pressures and softer demand due to market conditions affecting specialty margins, with plans to pass along tariff impacts through pricing [35][36] Question: Why would volume increases not translate to better margins? - Management explained that competitive pricing pressures exist despite volume growth, particularly in certain markets like Texas [44][46] Question: What is the company's strategy regarding inventory levels? - Management emphasized a disciplined approach to inventory management, noting that elevated levels were influenced by weather conditions and market softness [39][40] Question: How is the company prioritizing capital allocation? - Management stated that they are committed to greenfield and M&A opportunities while also being opportunistic with share repurchases [59][60] Question: What percent of lumber is sourced from Canada, and how would tariffs affect sourcing? - Management indicated that less than 20% of lumber is sourced from Canada and expressed confidence in passing through any tariff costs [67] Question: How is the pilot program to increase sales concentration with production builders progressing? - Management reported positive results from investments in builder pull-through capabilities, contributing to volume improvements [70][73]

Financial Data and Key Metrics Changes - The company reported net sales of $709 million, a decrease of 2% year over year [19] - Adjusted EBITDA was $19.6 million, representing a 2.8% adjusted EBITDA margin [6][21] - Adjusted net income was $2.3 million, or $0.27 per share [6][21] - Total gross profit was $111 million, with a gross margin of 15.7%, down 190 basis points from the prior period [20] Business Line Data and Key Metrics Changes - Specialty Products accounted for approximately 70% of net sales but saw a nearly 5% decline year over year due to price deflation and volume pressures [7][22] - Specialty Products gross margin was 18.7%, down 200 basis points from the previous year [23] - Structural Products net sales increased over 3% year over year, primarily due to higher lumber prices and increased volumes [24] Market Data and Key Metrics Changes - The average lumber prices were up 13% year over year, while panel prices were down 13% [8][24] - The company noted that the housing market is facing challenges, with the lowest existing housing sales backdrop in thirty years [11] - Multifamily housing starts were significantly higher year over year, contrasting with declines in total and single-family housing starts [12] Company Strategy and Development Direction - The company is focused on expanding its specialty product categories and gaining market share in engineered wood, siding, millwork, and outdoor living products [4][14] - Digital transformation efforts are on track, with Phase one expected to be completed by Q3 2025 [5] - The company is exploring greenfield and M&A opportunities to expand geographic reach and support specialty product sales growth [5][28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term housing fundamentals despite current market challenges [11][13] - The company anticipates that homeowners will eventually need to improve existing homes, driving repair and remodel activity [12] - Management acknowledged uncertainty regarding the timing of a sustained housing recovery but remains committed to strategic growth initiatives [13][15] Other Important Information - The company repurchased $15 million in shares during the first quarter [10][28] - Cash on hand was $449 million, with total available liquidity of approximately $795 million [25] - The company plans to manage capital expenditures relative to market conditions while maintaining a strong balance sheet [27][28] Q&A Session Summary Question: Can you discuss the impacts on specialty gross margins related to market challenges and tariffs? - Management noted competitive pricing pressures and the challenge of passing tariff costs through to maintain historical margins [33][34] Question: How are inventory levels being managed given the elevated levels? - Management stated that inventory management remains disciplined, with some build due to weather impacts and market softness [37][38] Question: What is the company's strategy regarding M&A and capital allocation? - Management indicated a commitment to pursuing M&A opportunities while also being opportunistic with share repurchases [58][59] Question: What percentage of lumber is sourced from Canada, and how would tariffs affect sourcing? - Management confirmed less than 20% exposure to Canada and expressed confidence in passing through tariff costs quickly [66] Question: Can you provide an update on the pilot program to increase sales concentration with production builders? - Management reported positive progress in builder pull-through capabilities, contributing to volume improvements despite general market declines [70][72]

Financial Performance - Net sales decreased by 23% year-over-year to $709 million[16, 22, 24] - Gross profit decreased by 13% year-over-year to $111 million[12, 22] - Gross margin decreased by 190 bps year-over-year to 157%[16, 22, 24] - Adjusted EBITDA decreased by 496% year-over-year to $196 million, representing 28% of net sales[16, 22, 24] - Adjusted net income decreased by 88% year-over-year to $23 million[16, 22] - Free cash flow was negative $40 million[16, 22, 24] Product Category Performance - Specialty product net sales decreased by 5% to $479 million, representing approximately 70% of total net sales[24, 26] - Structural product net sales increased by 3% to $230 million[24, 29] - Specialty product gross profit was $90 million, representing approximately 81% of total gross profit[26] - Structural product gross profit was $21 million, representing approximately 19% of total gross profit[29] Balance Sheet and Liquidity - Cash and cash equivalents totaled $449 million at the end of Q1 2025[38] - Total available liquidity was $795 million at the end of Q1 2025[38] - Net debt was negative $75 million[38] - Net leverage ratio was negative 07x[16, 38]

[First Quarter 2025 Results Overview](index=1&type=section&id=First%20Quarter%202025%20Results%20Overview) [Management Commentary and Highlights](index=1&type=section&id=Management%20Commentary%20and%20Highlights) The company maintained solid margins and continued its capital return program despite challenging market and weather conditions - CEO Shyam Reddy stated that the company maintained **solid margins** in both specialty and structural products despite challenging weather and market conditions[4](index=4&type=chunk) - The company returned capital to shareholders by repurchasing **$15 million** worth of shares during the quarter, with **$31 million** remaining on the share repurchase authorization[4](index=4&type=chunk)[9](index=9&type=chunk) **Q1 2025 Key Metrics Summary** | Metric | Value | | :--- | :--- | | Net Sales | $709 million | | Gross Profit | $111 million | | Gross Margin | 15.7% | | Net Income | $2.8 million | | Diluted EPS | $0.33 | | Adjusted EBITDA | $19.6 million | | Available Liquidity | $795 million | | Share Repurchases | $15 million | [Financial Performance](index=1&type=section&id=Financial%20Performance) [Overall Financial Performance](index=1&type=section&id=Overall%20Financial%20Performance) Net sales decreased 2% year-over-year to $709 million, while net income declined significantly to $2.8 million **Q1 2025 vs Q1 2024 Key Financials** | Financial Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $709M | $726M | -2.3% | | Gross Profit | $111M | $128M | -13.3% | | Gross Margin | 15.7% | 17.6% | -190 bps | | Net Income | $2.8M | $17.5M | -84.0% | | Diluted EPS | $0.33 | $2.00 | -83.5% | | Adjusted Net Income | $2.3M | $18.8M | -87.8% | | Adjusted Diluted EPS | $0.27 | $2.14 | -87.4% | | Adjusted EBITDA | $19.6M | $38.8M | -49.5% | [Specialty Products](index=1&type=section&id=Specialty%20Products) Specialty products net sales decreased 4.9% YoY to $479 million, attributed to price deflation and lower volumes **Specialty Products Performance (Q1 2025 vs Q1 2024)** | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $479M | $504M | -4.9% | | Gross Profit | $90M | $104M | -13.7% | | Gross Margin | 18.7% | 20.7% | -200 bps | - The decrease in net sales was driven by **price deflation** from external market conditions and lower volumes for most specialty product categories[6](index=6&type=chunk) - Excluding import duty-related benefits, the specialty products gross margin was **18.2%** in Q1 2025 compared to **19.4%** in Q1 2024, a decline of 120 basis points[6](index=6&type=chunk)[8](index=8&type=chunk) [Structural Products](index=1&type=section&id=Structural%20Products) Structural products net sales grew 3.3% YoY to $230 million, driven by increased lumber pricing and higher volumes **Structural Products Performance (Q1 2025 vs Q1 2024)** | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $230M | $222M | +3.3% | | Gross Profit | $21.4M | $23.6M | -9.3% | | Gross Margin | 9.3% | 10.6% | -130 bps | - The increase in structural sales was due to overall increases in **lumber pricing** and increased lumber and panel volumes, partially offset by price declines in panels[7](index=7&type=chunk) [Operating Expenses and Cash Flow](index=3&type=section&id=Operating%20Expenses%20and%20Cash%20Flow) SG&A expenses increased by $2.8 million to $94 million, while the company experienced a seasonal net cash outflow from operations - SG&A expenses were **$94 million**, a $2.8 million increase from the prior year, mainly due to technology initiatives and higher logistics costs[11](index=11&type=chunk) - Net cash used in operating activities was **$(34) million**, and free cash flow was **$(40) million**, which is typical for the first fiscal quarter due to seasonality[14](index=14&type=chunk) [Capital Allocation and Financial Position](index=3&type=section&id=Capital%20Allocation%20and%20Financial%20Position) [Capital Investments and Share Repurchases](index=3&type=section&id=Capital%20Investments%20and%20Share%20Repurchases) The company invested in facilities and its fleet while continuing its share repurchase program with a $15 million buyback - Invested **$6.4 million** in property and equipment, primarily for improvements to distribution facilities and digital transformation[15](index=15&type=chunk) - Entered into **$28 million** of new finance leases, mainly to enhance the company's fleet[15](index=15&type=chunk) - Purchased approximately **$15 million** of the Company's common stock, with **$31 million** remaining under the $100 million share repurchase program[15](index=15&type=chunk) [Debt and Liquidity](index=3&type=section&id=Debt%20and%20Liquidity) The company maintained a strong liquidity position of $795 million with a negative net debt position and a low net leverage ratio **Debt and Liquidity Position (as of March 29, 2025)** | Metric | Value | | :--- | :--- | | Total Debt & Finance Leases (excl. real property) | $374 million | | Cash and Cash Equivalents | $449 million | | Net Debt (excl. real property) | ($75) million | | Available Liquidity | $795 million | | Net Leverage Ratio (excl. real property) | (0.7x) | [Business Outlook](index=3&type=section&id=Business%20Outlook) [Second Quarter 2025 Outlook](index=3&type=section&id=Second%20Quarter%202025%20Outlook) The company anticipates stable gross margins for Q2 2025 and has observed improved average daily sales volumes - Through the first four weeks of Q2 2025, specialty product gross margin was in the range of **17% to 18%**[17](index=17&type=chunk) - Structural product gross margin was in the range of **9% to 10%** for the same period[17](index=17&type=chunk) - **Average daily sales volumes improved** versus both Q1 2025 and Q2 2024[17](index=17&type=chunk) [Supplemental Information](index=3&type=section&id=Supplemental%20Information) [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) A conference call to discuss financial results is scheduled for April 30, 2025, with a webcast available online - A conference call to discuss results is scheduled for **April 30, 2025, at 10:00 a.m. Eastern Time**[18](index=18&type=chunk) - A webcast and replay will be available in the Investor Relations section of the BlueLinx website[18](index=18&type=chunk) [Forward-Looking Statements](index=5&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements subject to risks and uncertainties that could cause results to differ materially - The report contains forward-looking statements about strategy, liquidity, debt, future share repurchases, and the Q2 2025 outlook[23](index=23&type=chunk) - These statements are subject to risks and uncertainties including, but not limited to, adverse housing market conditions, competition, trade policies, and pricing variability[24](index=24&type=chunk) [Non-GAAP Measures](index=7&type=section&id=Non-GAAP%20Measures) The company uses non-GAAP measures like Adjusted EBITDA and Free Cash Flow to provide a clearer view of its performance - **Adjusted EBITDA** is defined as net income plus interest, taxes, depreciation & amortization, and further adjusted for certain non-cash and special items[29](index=29&type=chunk) - **Adjusted Net Income** is defined as Net Income adjusted for certain non-cash and special items and their tax impacts[32](index=32&type=chunk) - **Free Cash Flow** is defined as net cash from operating activities less total capital expenditures[34](index=34&type=chunk) - **Net Debt** is calculated as total debt and finance lease obligations, less cash and cash equivalents, and is used to assess liquidity and leverage[37](index=37&type=chunk) [Financial Statements and Reconciliations](index=10&type=section&id=Financial%20Statements%20and%20Reconciliations) [Condensed Consolidated Statements of Operations](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q1 2025, the company reported net sales of $709.2 million and net income of $2.8 million, or $0.33 per diluted share **Condensed Consolidated Statements of Operations (Unaudited)** | (In thousands, except per share amounts) | Three Fiscal Months Ended March 29, 2025 | Three Fiscal Months Ended March 30, 2024 | | :--- | :--- | :--- | | Net sales | $ 709,226 | $ 726,244 | | Gross profit | $ 111,129 | $ 127,681 | | Operating income | $ 10,724 | $ 27,668 | | Net income | $ 2,805 | $ 17,492 | | Diluted earnings per share | $ 0.33 | $ 2.00 | [Condensed Consolidated Balance Sheets](index=11&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 29, 2025, total assets were $1.63 billion, with cash and cash equivalents decreasing to $449.0 million **Condensed Consolidated Balance Sheets (Unaudited)** | (In thousands) | As of March 29, 2025 | As of December 28, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | $ 449,020 | $ 505,622 | | Inventories, net | $ 399,555 | $ 355,909 | | Total current assets | $ 1,166,303 | $ 1,133,988 | | Total assets | $ 1,633,470 | $ 1,577,717 | | **LIABILITIES AND EQUITY** | | | | Total current liabilities | $ 280,574 | $ 233,724 | | Total liabilities | $ 997,356 | $ 931,276 | | Total stockholders' equity | $ 636,114 | $ 646,441 | | Total liabilities and stockholders' equity | $ 1,633,470 | $ 1,577,717 | [Condensed Consolidated Statements of Cash Flows](index=12&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The first quarter saw a net cash usage of $33.9 million from operations and $19.3 million from financing activities **Condensed Consolidated Statements of Cash Flows (Unaudited)** | (In thousands) | Three Fiscal Months Ended March 29, 2025 | Three Fiscal Months Ended March 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $ (33,908) | $ (31,135) | | Net cash used in investing activities | $ (3,392) | $ (5,320) | | Net cash used in financing activities | $ (19,302) | $ (3,979) | | Net change in cash and cash equivalents | $ (56,602) | $ (40,434) | | Cash and cash equivalents at end of period | $ 449,020 | $ 481,309 | [Gross Profit and Gross Margin by Product Category](index=13&type=section&id=Gross%20Profit%20and%20Gross%20Margin%20by%20Product%20Category) This schedule disaggregates revenues and gross profit, showing an adjusted total gross margin of 15.3% for Q1 2025 **Gross Profit and Margin by Product Category (Q1 2025)** | Product Category | Net Sales ($M) | Gross Profit ($M) | Gross Margin % | | :--- | :--- | :--- | :--- | | Specialty products | $479.4 | $89.8 | 18.7% | | Structural products | $229.8 | $21.4 | 9.3% | | **Total** | **$709.2** | **$111.1** | **15.7%** | - Excluding a **$2.4 million** benefit from import duty-related items, the company's gross margin for Q1 2025 would have been **15.3%**, compared to 16.7% in Q1 2024 (which excluded a $6.5 million benefit)[46](index=46&type=chunk) [Reconciliation of Non-GAAP Measurements](index=14&type=section&id=Reconciliation%20of%20Non-GAAP%20Measurements) This section reconciles GAAP Net Income of $2.8 million to non-GAAP Adjusted EBITDA of $19.6 million for Q1 2025 **Reconciliation of Net Income to Adjusted EBITDA (Q1 2025 vs Q1 2024)** | (In thousands) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income | $ 2,805 | $ 17,492 | | Depreciation and amortization | $ 9,554 | $ 9,433 | | Interest expense, net | $ 6,580 | $ 4,624 | | Provision for income taxes | $ 1,339 | $ 5,552 | | Other adjustments | $ (720) | $ 1,680 | | **Adjusted EBITDA** | **$ 19,558** | **$ 38,781** | **Reconciliation of Net Income to Adjusted Net Income (Q1 2025 vs Q1 2024)** | (In thousands) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income | $ 2,805 | $ 17,492 | | Adjustments (pre-tax) | $ (720) | $ 1,680 | | Tax impacts of adjustments | $ 233 | $ (405) | | **Adjusted net income** | **$ 2,318** | **$ 18,767** | [Liquidity Measures](index=16&type=section&id=Liquidity%20Measures) The company reported a negative Net Debt of $74.7 million and a Net Leverage Ratio of (0.7x) as of March 29, 2025 **Net Debt and Leverage Ratio Calculation (as of March 29, 2025)** | ($ amounts in thousands) | Value | | :--- | :--- | | Total debt and finance leases | $ 616,755 | | Less: available cash and cash equivalents | $ 449,020 | | **Net debt (non-GAAP)** | **$ 167,735** | | **Net debt, excluding real property finance leases (non-GAAP)** | **$ (74,655)** | | Trailing twelve-month adjusted EBITDA | $ 112,133 | | **Net leverage ratio excl. real property finance leases** | **(0.7x)** | **Free Cash Flow Reconciliation (Q1 2025)** | (In thousands) | Value | | :--- | :--- | | Net cash used in operating activities | $ (33,908) | | Less: Disbursements for property and equipment | $ (5,932) | | **Free cash flow - non-GAAP** | **$ (39,840)** |

Group 1 - The article does not provide any specific company or industry insights, focusing instead on the author's personal disclosures and opinions [1][2][3]

分组1 - Short-term market volatility in 2025 can be mitigated by adopting a longer investment horizon, allowing for potential recovery from near-term losses [1] - Evaluating companies for long-term potential can be simplified by considering Wall Street analysts' price target estimates, which can be averaged to reduce the impact of outlier ratings [2] 分组2 - Dycom Industries Inc. (NYSE: DY) provides contracting services for U.S. telecommunications and utility industries, with a current stock price of $154.41 and a 12-month price forecast of $200.22, indicating a 29.67% upside [4][5] - In Q4 2024, Dycom's contract revenues increased by 13.9% year-over-year to nearly $1.1 billion, with diluted earnings per share (EPS) growing over 40% year-over-year to $1.11 [5][6] - Analysts have initiated coverage on Dycom with an Overweight rating, and the stock's price-to-sales ratio is currently 0.93, suggesting potential value [7][6] 分组3 - Orion Group Holdings Inc. (NYSE: ORN) focuses on industrial construction, with a current stock price of $6.01 and a 12-month price forecast of $12.50, representing a 108.16% upside [8][9] - The company has a $16 billion new business pipeline and a backlog of just under $1 billion, having returned to profitability in Q4 2024 [11] - Orion's stock has fallen approximately 21% year-to-date, but its price-to-sales ratio is now 0.29, making it an attractive value opportunity [12] 分组4 - BlueLinx Holdings Inc. (NYSE: BXC) is expected to face increased materials costs due to tariffs, but its strong U.S. operations and demand for specialized products may mitigate these challenges [14] - The current stock price for BlueLinx is $71.68, with a 12-month price forecast of $122.25, indicating a 70.55% upside [15] - Analysts unanimously rate BlueLinx a Buy, with a consensus price target close to 75% above the current price, highlighting its competitive edge in the niche construction supply chain [16][13]

BlueLinx Q4 and Full Year 2024 Results Delivering What Matters February 19, 2025 © BlueLinx 2025. All Rights Reserved. 1 Safe Harbor Statement This presentation contains forward-looking statements. Forward-looking statements include, without limitation, any statement that predicts, forecasts, indicates or implies future results, performance, liquidity levels or achievements, and may contain the words "believe," "anticipate," "could," "expect," "estimate," "intend," "may," "project," "plan," "should," "will, ...

Financial Data and Key Metrics Changes - For the full year 2024, the company generated net sales of $3 billion, a decrease of 6% from 2023, primarily due to specialty price deflation [42] - Adjusted EBITDA for 2024 was $131 million, representing a 4.4% adjusted EBITDA margin [43] - Net income for the year was $53 million, with diluted EPS at $6.19 per share [43] - The company reported liquidity of $852 million at the end of the year, including $506 million in cash [17][45] Business Line Data and Key Metrics Changes - Specialty products accounted for approximately 70% of net sales and 80% of gross profit for both Q4 and full year 2024 [11] - Specialty product sales were $484 million in Q4, down 1% year over year, while structural product sales were $227 million, up 1% [32][38] - Specialty gross margin was 18.4%, down 100 basis points from the previous year, while structural gross margin was 10.8%, up 20 basis points [36][39] Market Data and Key Metrics Changes - The company faced a challenging housing market with the lowest existing housing sales in thirty years and elevated interest rates impacting demand [21] - Builder sentiment fell due to concerns about tariffs and affordability issues, leading to expectations of flat to declining housing starts in 2025 [22][24] - Despite market challenges, the company reported low single-digit volume growth in specialty products year over year [10] Company Strategy and Development Direction - The company is focused on five high-margin specialty product categories: engineered wood, siding, millwork, industrial, and outdoor living products [10] - A digital transformation initiative is underway to enhance operational capabilities and customer experience, with a new e-commerce platform in pilot phase [13][14] - The company plans to open additional greenfield locations, with expectations of generating $40 million to $100 million in net sales at maturity [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term prospects in the housing and building products sector despite near-term uncertainties [24][25] - The company is committed to gaining market share through strategic focus on national accounts and multifamily growth [24][26] - Management noted that while pricing remains volatile, there is hope for stabilization in specialty product pricing [28] Other Important Information - The company returned $45 million to shareholders in 2024 through share repurchases [18] - SG&A expenses increased by 10% in Q4 due to higher payroll and logistics costs [33] - The company anticipates a slight increase in SG&A levels for 2025 as it continues to invest in growth initiatives [43] Q&A Session Summary Question: Can you provide more color on the sequential improvement on specialty product pricing? - Management noted five quarters of sequential year-over-year growth in specialty products, indicating a targeted strategy is yielding results [56][58] Question: What are you hearing from channel partners regarding R and R demand expectations in 2025? - Management indicated that low existing home sales pressure repair and remodel activity, but they are focused on gaining share in this area [61][63] Question: What is the timeline for the full ramp of your e-commerce platform? - Management stated that the e-commerce platform is in a pilot phase and will be gradually enhanced over the coming years [66][68] Question: Can you provide an update on the Portland greenfield location? - Management mentioned that the Portland location is in its early stages, with a focus on ramping up capabilities and sales [82][86] Question: How might your strategy change if tariffs on Canada are implemented? - Management expressed confidence in their inventory management capabilities and indicated that they would adapt their strategy as needed [100][102] Question: What is the current status of vendor commitments for the Portland facility? - Management confirmed that vendor relationships are in place to support the product mix needed for the Portland facility [104][106] Question: Can you discuss the growth in your multifamily business? - Management highlighted a strategic focus on multifamily, with enhanced teams and capital allocation driving year-over-year growth [128][130]

Financial Data and Key Metrics Changes - The company generated net sales of $747 million, a decrease of 8% year-over-year, with adjusted EBITDA of $36.6 million, resulting in a 4.9% adjusted EBITDA margin [12][25] - Adjusted net income was $16.7 million or $1.95 per share, while net income was $16 million or $1.87 per share [27][12] - Total gross profit was $126 million, with a gross margin of 16.8%, down 40 basis points from the prior period [25] Business Line Data and Key Metrics Changes - Specialty products accounted for approximately 70% of net sales, with revenues declining 7% year-over-year due to price deflation [13][28] - Specialty gross margin was 19.4%, down 40 basis points from last year, while structural product revenues declined 9% due to significant price deflation [14][30] - Structural products generated net sales of $228 million, with a gross margin of 11%, down 30 basis points from the same period last year [30] Market Data and Key Metrics Changes - The U.S. housing market remains volatile, with total housing starts at an adjusted annual rate of 1.35 million, down 0.5% from August and down 0.7% year-over-year [19] - Existing home sales have sunk to their lowest levels in 30 years, impacting repair and remodel activity [21] - The turnover rate for homes is only 2.5%, the lowest level in over 30 years, indicating a weak sales velocity [21] Company Strategy and Development Direction - The company is focused on growing key specialty product categories at a higher rate than structural products, aiming for a shift in product mix over the next several years [8] - Digital transformation efforts are on track, with Phase 1 expected to be completed by Q3 2025, enhancing operational and commercial capabilities [9] - The company is exploring greenfield and M&A opportunities to expand geographic reach and support specialty product sales growth [10] Management's Comments on Operating Environment and Future Outlook - Management noted that low existing home turnover and home affordability issues are hindering the housing market recovery [16] - The Federal Reserve's interest rate positioning is critical for the housing recovery, with current mortgage rates above 6.5% [17][18] - Management believes sustained reductions in interest rates are necessary to support a long-term housing recovery, expected to begin in the back half of 2025 [18] Other Important Information - The company repurchased $15 million in shares during the third quarter, totaling over $138 million since the beginning of 2022 [16] - The financial position remains strong, with cash on hand of $526 million and available liquidity of approximately $873 million at the end of the quarter [32] Q&A Session Summary Question: What drove the positive volume growth in Specialty Products? - Management attributed the growth to a strong focus on share gain strategies, particularly in national accounts and multifamily sectors, along with some seasonal benefits [38] Question: Have there been any sequential moderation of price declines in key specialty categories? - Management noted a slight sequential improvement in pricing for specialty products in the first four weeks of Q4, indicating confidence in future pricing improvements [39] Question: What is the outlook for structural margins given recent price dynamics? - Management indicated that structural margins improved due to a normalization of inventory levels and a better balance in supply and demand [40][41] Question: Can you provide an update on the competitive landscape? - Management highlighted solid performance in the East region and noted that private-label products help weather competitive pressures [44][45] Question: What happens if interest rates do not decrease? - Management emphasized a focus on greenfield opportunities and maintaining a disciplined approach to inventory management to navigate market dynamics [49][50] Question: How is inventory management being handled in growth specialty categories? - Management stated that inventory is managed to specific turn day targets to support customer demands, ensuring optimal stocking positions [60]

BlueLinx Q3 2024 Results Delivering What Matters October 30, 2024 BLUELINX © BlueLinx 2024. All Rights Reserved. 1 Safe Harbor Statement This presentation contains forward-looking statements. Forward-looking statements include, without limitation, any statement that predicts, forecasts, indicates or implies future results, performance, liquidity levels or achievements, and may contain the words "believe," "anticipate," "could", "expect," "estimate," "intend," "may", "project," "plan," "should", "will", "wil ...