Boise Cascade(US:BCC)2022-11-01 19:23Financial Data and Key Metrics Changes - Consolidated third quarter sales were $2.2 billion, up 15% from the third quarter of 2021 [6] - Net income was $219.6 million or $5.52 per share, compared to $91.7 million or $2.31 per share in the year-ago quarter [6] - Segment EBITDA for Wood Products was $177.3 million, up from $136 million in the prior year [6][9] - Building Materials Distribution (BMD) reported segment EBITDA of $161.2 million, compared to $22.6 million in the prior year [7][10] Business Line Data and Key Metrics Changes - Wood Products sales were $595.3 million, up from $497.3 million in the third quarter of 2021 [9] - BMD sales were $2 billion, up 14% from the third quarter of 2021 [10] - Sales volumes for LVL were up 12%, while I-joists were down 15% compared to the third quarter of 2021 [10] - Plywood sales volume was 329 million feet, up from 314 million feet in the prior year [12] Market Data and Key Metrics Changes - Total U.S. housing starts decreased by 7%, with single-family housing starts down 18% compared to the same period last year [6] - Pricing for LVL and I-joists increased by 19% and 18%, respectively, compared to the second quarter of 2022 [11] - Plywood average net sales price was $477 per 1,000 feet, down 15% from the third quarter of 2021 [12] Company Strategy and Development Direction - The company is focused on integrating Coastal Plywood operations and expanding EWP capacity [20] - BMD is executing organic growth and expanding projects in various locations [20] - The company aims to manage market uncertainties and volatile commodity pricing effectively [21] Management's Comments on Operating Environment and Future Outlook - The company expects a decline in demand for new residential construction due to home affordability constraints and a weakening economy [18] - Home improvement spending is anticipated to remain supported by the age of U.S. housing stock and elevated homeowner equity [19] - The company remains well-positioned to navigate market uncertainties and is committed to strategic priorities [21] Other Important Information - The Board authorized a quarterly dividend of $0.15 per share, representing a 25% increase, and a special dividend of $1 per share [8][16] - Total available liquidity at September 30 was approximately $1.3 billion [15] Q&A Session Summary Question: Outlook on EWP pricing trajectory - Management indicated that EWP pricing tends to adjust more slowly than commodity pricing, and future pricing will depend on housing starts [24][25] Question: Opportunities for new partnerships in BMD - Management noted that there are limited options for growth in tight supply markets, but they see opportunities for expanding product offerings [30] Question: Contribution from Coastal acquisition - Management stated that specific performance at a location level is not typically disclosed, but purchase price accounting impacted expectations [47] Question: Capital expenditures for 2023 - Management outlined that capital expenditures will focus on expanding EWP capacity and organic growth projects [41][43] Question: Inventory levels relative to historical peaks - Management confirmed that current inventory levels are aligned with sales pace and down from peak levels [62]