BMC sees Q2 sales staggered by deflation
BMC Stock Holdings (BMC) reported second quarter 2019 sales fell 5.2% to $946.4 million from sales of $998.5 million for the same period a year ago.
The Raleigh, N.C.-based pro dealer attributed the decline to commodity price deflation within lumber, lumber sheet goods, and structural components, which had a negative 8.9% impact on sales. Decreases were partially offset by a 2.8% sales increase derived from the acquisitions of Barefoot and Company and Locust Lumber, in addition to 2% organic growth.
The company also reported a net income of $35.7 million for the second quarter, down 11.6% from a net income of $40.4 million for the same period last year.
Last week, the company acquired Kingston Lumber. Located in Kingston, Wa. and serving the greater Seattle market, Kingston Lumber is a supplier of trusses and other building materials primarily to custom homebuilders and professional remodeling contractors. The company generated net sales of approximately $24 million in 2018.
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The bottom line: Volatility in commodities cause sales to decline 5.2% to $946.4 million while profits fall 11.6% to $35.7 million.
What the CEO said: “Our investments in innovation, productivity, talent development and tuck-in acquisitions are helping us gain share in our value-added categories, enhance our footprint and customer mix in our local markets and drive a culture of continuous improvement. Importantly, during the quarter, these efforts enabled us to deliver organic growth in our value-added product categories, including 4.5% organic net sales growth in Structural Components before deflation and 5.3% organic net sales growth in Millwork, Doors and Windows, both of which solidly outpaced the underlying trends in single-family starts,” said Dave Flitman, president and CEO of BMC Stock.
Company info: BMC Stock Holdings’ full second quarter 2019 report can be read here.
BMC’s footprint includes serving 45 metro markets in 19 states, primarily in the South and West.
The Raleigh, N.C.-based pro dealer attributed the decline to commodity price deflation within lumber, lumber sheet goods, and structural components, which had a negative 8.9% impact on sales. Decreases were partially offset by a 2.8% sales increase derived from the acquisitions of Barefoot and Company and Locust Lumber, in addition to 2% organic growth.
The company also reported a net income of $35.7 million for the second quarter, down 11.6% from a net income of $40.4 million for the same period last year.
Last week, the company acquired Kingston Lumber. Located in Kingston, Wa. and serving the greater Seattle market, Kingston Lumber is a supplier of trusses and other building materials primarily to custom homebuilders and professional remodeling contractors. The company generated net sales of approximately $24 million in 2018.
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The bottom line: Volatility in commodities cause sales to decline 5.2% to $946.4 million while profits fall 11.6% to $35.7 million.
What the CEO said: “Our investments in innovation, productivity, talent development and tuck-in acquisitions are helping us gain share in our value-added categories, enhance our footprint and customer mix in our local markets and drive a culture of continuous improvement. Importantly, during the quarter, these efforts enabled us to deliver organic growth in our value-added product categories, including 4.5% organic net sales growth in Structural Components before deflation and 5.3% organic net sales growth in Millwork, Doors and Windows, both of which solidly outpaced the underlying trends in single-family starts,” said Dave Flitman, president and CEO of BMC Stock.
Company info: BMC Stock Holdings’ full second quarter 2019 report can be read here.
BMC’s footprint includes serving 45 metro markets in 19 states, primarily in the South and West.