Big profits for Boise Cascade in Q3
Sales at Boise Cascade jumped 23% to $1.6 billion for the third quarter, compared to sales of $1.3 billion in the third quarter 2019.
The Boise, Idaho-based building products supplier and distributor also reported a third quarter net income of $103.2 million, nearly tripling its net income of $27.2 million for the same period last year.
Wood Products sales, including sales to Boise’s Building Materials Distribution (BMD) segment, increased 12% to $363.7 million for the quarter from sales of $325.1 million in the prior third quarter. The increase in sales was driven primarily by higher plywood prices and higher sales volumes for I-joists.
Demand for plywood in third quarter 2020 far outpaced industry production levels, driving the sharp increase in pricing, the company reported. The increases were offset partially by lower sales volumes for plywood and LVL, as well as decreased net sales prices for LVL and I-joists (collectively referred to as EWP).
Wood Products' segment income increased to $66 million for the period from an income of $15.6 million for the same period last year. The increase in segment income was due primarily to higher plywood sales prices, offset partially by higher wood fiber costs, as well as lower net sales prices of EWP.
BMD's sales increased 25% to $1.44 billion for the third quarter compared to sales of $1.15 billion for the same period last year. Compared with the same quarter in the prior year, the overall increase in sales was driven by sales price increases of 25%, with relatively flat sales volumes.
By product line, commodity sales increased 54%, general line product sales increased 6%, and sales of EWP increased 6%. BMD segment income increased $69.2 million to $107.9 million for the three months ended September 30, 2020, from $38.7 million in the comparative prior year quarter.
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The Bottom Line: Profits soar 279% to $103.2 million as sales leap 23% to $1.6 billion.
What the CEO said: “Extraordinary market conditions, along with great execution by both of our businesses, helped us deliver outstanding results in the third quarter,” said Nate Jorgensen, CEO of Boise Cascade. Financial results aside, I am proud that associates across our organization continue to effectively adapt to challenges brought about by the pandemic without losing focus on our core value of safety. It has also been inspiring to witness our teams in Louisiana and Oregon caring for each other and their communities in response to the gulf coast hurricanes and the catastrophic fires in the Pacific Northwest.”
Company info: Boise Cascade’s full third quarter earnings report can be read here.