Swing to profit for BMC

Pointing to rising costs of lumber and sheet goods along with strong fundamentals for single-family housing, Atlanta-based BMC Stock Holdings reported an increase of 4.2% in first quarter sales. The company also saw net income swing to a profit of $3.7 million.

Net sales for the company were $757.7 million, and included accelerating growth in the month of March. 

The company completed two acquisitions (including one in April), enhancing the BMC footprint and value-added capabilities in the Washington, D.C., and Dallas/Fort Worth markets. It acquired Code Plus Components in the Washington, D.C., area; and Texas Plywood & Lumber Co. in Dallas/Fort Worth.

“The solid fundamentals supporting an improving housing market, combined with our internal growth initiatives aimed at growing our higher-margin categories, should enable us to deliver notable profit growth for 2017," said CEO Peter Alexander, in a prepared statement.

Meanwhile, rain in some western markets delayed construction and curtailed growth at the beginning of the year. March sales picked up the pace with 9% sales gains, a rate that continued in April, Alexander said.

Once again, the company touted the growth of Ready-Frame, BMC's proprietary whole-home framing solution. Sales of Ready-Frame in the first quarter grew 68% to $34.1 million.

"With moderating weather out west, we expect increased top line growth in the upcoming quarters and expect at least a 50% increase in Ready-Frame sales for full year 2017 as compared to 2016," Alexander said. "For the full year, we expect to achieve significant improvements in profitability as we continue to implement our growth strategies and realize improved operating expense leverage.”

The company also reaffirmed expectation of total annual run rate cost savings from the BMC-Stock merger of $46 million to $52 million by the end of 2017.