Boise Cascade Company Reports Second Quarter 2021 Results

BOISE, Idaho–()–Boise Cascade Company (“Boise Cascade,” the “Company,” “we,” or “our”) (NYSE: BCC) today reported net income of $302.6 million, or $7.62 per share, on sales of $2.4 billion for the second quarter ended June 30, 2021, compared with net income of $33.6 million, or $0.85 per share, on sales of $1.2 billion for the second quarter ended June 30, 2020.

“Our associates in both businesses performed with focus and dedication to capitalize on the strength in residential construction, delivering exceptional results while supporting our customers and supplier partners. Additionally, as a tribute to our associates’ commitment to safety, I’m proud to report we completed one of our safest quarters on record,” stated Nate Jorgensen, CEO. “As we look to the third quarter, the downward commodity pricing trends experienced in recent weeks have created a challenging environment, and we are focused on mitigating their impact without sacrificing customer service. The strength of our current balance sheet position allows us to remain focused on executing our strategy, including future organic and acquisition growth opportunities.”

Second Quarter 2021 Highlights

 

 

2Q 2021

 

2Q 2020

 

% change

 

 

(in thousands, except per-share data and percentages)

Consolidated Results

 

 

 

 

 

 

Sales

 

$

2,443,161

 

 

$

1,242,760

 

 

97

%

Net income

 

302,556

 

 

33,586

 

 

801

%

Net income per common share – diluted

 

7.62

 

 

0.85

 

 

796

%

Adjusted EBITDA 1

 

430,323

 

 

71,776

 

 

500

%

Segment Results

 

 

 

 

 

 

Wood Products sales

 

$

594,569

 

 

$

281,505

 

 

111

%

Wood Products income

 

213,761

 

 

17,074

 

 

1,152

%

Wood Products EBITDA 1

 

227,889

 

 

31,005

 

 

635

%

Building Materials Distribution sales

 

2,172,744

 

 

1,134,260

 

 

92

%

Building Materials Distribution income

 

206,338

 

 

43,210

 

 

378

%

Building Materials Distribution EBITDA 1

 

212,255

 

 

48,794

 

 

335

%

1 For reconciliations of non-GAAP measures, see summary notes at the end of this press release.

As both a manufacturer and a distributor, our second quarter 2021 financial results were favorably impacted by higher commodity wood products pricing compared to pricing in the same period last year, driven by continued robust construction activity during second quarter 2021. While not subject to the significant price fluctuations of commodity products, demand also exceeded supply for many of the general line and engineered wood products (EWP) distributed by Building Materials Distribution (BMD). Lumber pricing peaked in May 2021, then dropped sharply driven by declining repair and remodel and “do-it-yourself” activity, causing hesitancy in the marketplace because of expectations for potential price erosion. With COVID-19 vaccines and easing pandemic restrictions, people are spending less time at home on home improvement projects, resulting in reduced demand from our home center customers.

In the second quarter 2021, total U.S. housing starts increased 43% compared to the same period in 2020. Single-family housing starts, the primary driver of our sales volumes, also increased 42%. On a year-to-date basis through June 2021, total and single-family housing starts increased 25% and 30%, respectively, compared with the same period in 2020.

Wood Products

Wood Products’ sales, including sales to BMD, increased $313.1 million, or 111%, to $594.6 million for the three months ended June 30, 2021, from $281.5 million for the three months ended June 30, 2020. The increase in sales was driven primarily by higher plywood prices, as plywood demand in the second quarter outpaced industry production levels, driving the favorable pricing. Higher sales volumes and net sales prices for I-joists and LVL (collectively referred to as EWP) also increased compared to the prior period. In addition, improved lumber sales prices and plywood sales volumes contributed to the increase in sales. Comparative average net selling prices and sales volume changes for EWP and plywood are as follows:

 

 

2Q 2021 vs. 2Q 2020

 

2Q 2021 vs. 1Q 2021

 

 

 

 

 

Average Net Selling Prices

 

 

 

 

LVL

 

7%

 

3%

I-joists

 

8%

 

3%

Plywood

 

206%

 

58%

Sales Volumes

 

 

 

 

LVL

 

22%

 

8%

I-joists

 

53%

 

6%

Plywood

 

8%

 

11%

Wood Products’ segment income increased $196.7 million to $213.8 million for the three months ended June 30, 2021, from $17.1 million for the three months ended June 30, 2020. The increase in segment income was due primarily to higher plywood, EWP, and lumber sales prices, as well as higher EWP sales volumes. These improvements were offset partially by higher wood fiber costs, as well as increased selling and distribution expenses of $1.3 million.

Building Materials Distribution

BMD’s sales increased $1,038.5 million, or 92%, to $2,172.7 million for the three months ended June 30, 2021, from $1,134.3 million for the three months ended June 30, 2020. Compared with the same quarter in the prior year, the overall increase in sales was driven by sales price and volume increases of 83% and 9%, respectively. By product line, commodity sales increased 167%, general line product sales increased 26%, and sales of EWP (substantially all of which is sourced through our Wood Products segment) increased 52%.

BMD segment income increased $163.1 million to $206.3 million for the three months ended June 30, 2021, from $43.2 million in the comparative prior year quarter. The improvement in segment income was driven by a gross margin increase of $187.9 million, resulting from improved sales volumes and gross margins on substantially all product lines, particularly commodity products, compared with second quarter 2020. The margin improvement was offset partially by increased selling and distribution expenses of $25.9 million.

Unallocated Corporate Costs

Unallocated corporate expenses increased $1.8 million to $10.3 million for the three months ended June 30, 2021, from $8.5 million for the same period in the prior year. As part of our self-insured risk retention program, corporate absorbed approximately $3.4 million of estimated insurance losses resulting from a fire at our BMD Phoenix location. These losses were offset partially by lower incentive compensation driven by the departure of an officer and related forfeiture of accrued incentive compensation.

Balance Sheet and Liquidity

Boise Cascade ended second quarter 2021 with $653.8 million of cash and cash equivalents and $345.3 million of undrawn committed bank line availability, for total available liquidity of $999.1 million. The Company had $444.2 million of outstanding debt at June 30, 2021.

We expect capital expenditures in 2021 to total approximately $90 million to $100 million. Included in our capital spending range is the completion of a log utilization center project at our Florien plywood and veneer plant, a new door assembly operation in Houston, and expansion of our distribution capabilities in the Nashville market. This level of capital expenditures could increase or decrease as a result of a number of factors, including acquisitions, efforts to accelerate organic growth, exercise of lease purchase options, our financial results, future economic conditions, availability of engineering and construction resources, and timing and availability of equipment purchases.

Dividends

On June 28, 2021, our board of directors declared a supplemental dividend of $2.00 per share on our common stock, payable on July 30, 2021, to stockholders of record on July 15, 2021. At June 30, 2021, we accrued $78.7 million in “Dividends payable” on our Consolidated Balance Sheets, representing our supplemental dividend declaration. On July 29, 2021, our board of directors declared a quarterly dividend of $0.10 per share on our common stock, payable on September 15, 2021, to stockholders of record on September 1, 2021.

Future dividend declarations, including amount per share, record date and payment date, will be made at the discretion of our board of directors and will depend upon, among other things, legal capital requirements and surplus, our future operations and earnings, general financial condition, contractual obligations, restrictions imposed by our asset-based credit facility and the indenture governing our senior notes, applicable laws, and other factors that our board of directors may deem relevant.

Outlook

In recent months, the effects of the COVID-19 vaccine and COVID-19 safety protocols have resulted in fewer pandemic-related disruptions to both our manufacturing and distribution locations. Although many restrictions related to COVID-19 have been lightened, we continue to conduct business with certain modifications to mill and distribution center housekeeping and cleanliness protocols, employee travel, employee work locations, and virtualization or cancellation of certain sales and marketing events, among other modifications. In addition, we continue to actively monitor evolving developments, including the impact of COVID-19 variants, and may take actions that alter our business operations as may be required by federal, state, or local authorities, or that we determine are in the best interests of our employees, customers, suppliers, communities, and stockholders.

Economic uncertainty due to the pandemic continues. However, low mortgage rates, continuation of work-from-home practices by many in the economy, and demographics in the U.S. have created a favorable demand environment for new residential construction, particularly single-family housing starts, which we expect to continue in 2021 and into next year. As of July 2021, the Blue Chip Economic Indicators consensus forecast for 2021 and 2022 single- and multi-family housing starts in the U.S. were 1.60 million and 1.58 million units, respectively, compared with actual housing starts of 1.38 million in 2020, as reported by the U.S. Census Bureau. Although we believe that current U.S. demographics support the higher level of forecasted housing starts, and many national home builders are reporting strong near-term backlogs, labor shortages and supply induced constraints on residential construction activity may continue to extend build times and limit activity. In addition, while the age of the U.S. housing stock and limited home inventory availability will continue to provide a favorable backdrop for repair and remodel spending, we expect the recent decline in home improvement demand to continue near-term as travel restrictions are rescinded and pent-up demand for leisure spending occurs.

As a wholesale distributor of a broad mix of commodity products and a manufacturer of certain commodity products, we have sales and profitability exposure to declines in commodity product prices. Lumber pricing was very volatile during second quarter 2021, with rapidly rising prices in April and most of May followed by sharp price declines during the remainder of the quarter. Our BMD segment purchases and resells a broad mix of commodity products with periods of increasing prices providing the opportunity for higher sales and increased margins, while declining price environments expose us to declines in sales and profitability. Current composite panel and lumber prices have declined by approximately 53% and 48% from levels at the end of second quarter 2021. Future commodity product pricing and commodity input costs could be volatile in response to capacity restoration and industry operating rates, the impact of COVID-19 on residential construction, net import and export activity, transportation constraints or disruptions, inventory levels in various distribution channels, and seasonal demand patterns.

About Boise Cascade

Boise Cascade Company is one of the largest producers of engineered wood products and plywood in North America and a leading U.S. wholesale distributor of building products. For more information, please visit the Company’s website at www.bc.com.

Webcast and Conference Call

Boise Cascade will host a webcast and conference call to discuss second quarter earnings on Tuesday, August 3, 2021, at 11 a.m. Eastern.

To participate in the conference call, dial 844-795-4410 and use participant passcode 6669007 (international callers should dial 661-378-9637). To join the webcast, go to the Investor Relations section at www.bc.com and select the Event Calendar link.

A replay of the conference call will be available from Tuesday, August 3, 2021, at 2 p.m. Eastern through Tuesday, August 10, 2021, at 2 p.m. Eastern. Replay numbers are 855-859-2056 for U.S. callers and 404-537-3406 for international callers with a passcode of 6669007. The archived webcast will be available in the Investor Relations section of Boise Cascade’s website.

Use of Non-GAAP Financial Measures

We refer to the terms EBITDA and Adjusted EBITDA in this earnings release and the accompanying Quarterly Statistical Information as supplemental measures of our performance and liquidity that are not required by or presented in accordance with generally accepted accounting principles in the United States (GAAP). We define EBITDA as income (loss) before interest (interest expense and interest income), income taxes, and depreciation and amortization. Additionally, we disclose Adjusted EBITDA, which further adjusts EBITDA to exclude the change in fair value of interest rate swaps.

We believe EBITDA and Adjusted EBITDA are meaningful measures because they present a transparent view of our recurring operating performance and allow management to readily view operating trends, perform analytical comparisons, and identify strategies to improve operating performance. We also believe EBITDA and Adjusted EBITDA are useful to investors because they provide a means to evaluate the operating performance of our segments and our Company on an ongoing basis using criteria that are used by our management and because they are frequently used by investors and other interested parties when comparing companies in our industry that have different financing and capital structures and/or tax rates. EBITDA and Adjusted EBITDA, however, are not measures of our liquidity or financial performance under GAAP and should not be considered as alternatives to net income (loss), income (loss) from operations, or any other performance measure derived in accordance with GAAP or as alternatives to cash flow from operating activities as a measure of our liquidity. The use of EBITDA and Adjusted EBITDA instead of net income (loss) or segment income (loss) have limitations as analytical tools, including: the inability to determine profitability; the exclusion of interest expense, interest income, and associated significant cash requirements; and the exclusion of depreciation and amortization, which represent unavoidable operating costs. Management compensates for these limitations by relying on our GAAP results. Our measures of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation.

Forward-Looking Statements

This press release includes statements about our expectations of future operational and financial performance that are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements preceded or followed by, or that otherwise include, the words “believes,” “expects,” “anticipates,” “intends,” “project,” “estimates,” “plans,” “forecast,” “is likely to,” and similar expressions or future or conditional verbs such as “will,” “may,” “would,” “should,” and “could” are generally forward-looking in nature and not historical facts. Such statements are based upon the current beliefs and expectations of our management and are subject to significant risks and uncertainties. The accuracy of such statements is subject to a number of risks, uncertainties, and assumptions that could cause our actual results to differ materially from those projected, including, but not limited to, prices for building products, changes in the competitive position of our products, commodity input costs, the effect of general economic conditions, the effect of COVID-19, mortgage rates and availability, housing demand, housing vacancy rates, governmental regulations, unforeseen production disruptions, as well as natural disasters. These and other factors that could cause actual results to differ materially from such forward-looking statements are discussed in greater detail in our filings with the Securities and Exchange Commission. Forward-looking statements speak only as of the date of this press release. We undertake no obligation to revise them in light of new information. Finally, we undertake no obligation to review or confirm analyst expectations or estimates that might be derived from this release.

Boise Cascade Company

Consolidated Statements of Operations

(in thousands, except per-share data) (unaudited)

 

Three Months Ended

Six Months Ended

 

June 30

March 31, 2021

June 30

 

2021

 

2020

 

2021

 

2020

 

 

 

 

 

 

 

Sales

$

2,443,161

 

$

1,242,760

 

$

1,821,316

 

$

4,264,477

 

$

2,413,294

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

Materials, labor, and other operating expenses (excluding depreciation)

1,864,523

 

1,048,902

 

1,450,434

 

3,314,957

 

2,041,172

 

Depreciation and amortization

20,420

 

19,899

 

19,539

 

39,959

 

55,231

 

Selling and distribution expenses

130,736

 

103,566

 

120,917

 

251,653

 

203,029

 

General and administrative expenses

17,988

 

18,755

 

25,262

 

43,250

 

34,839

 

Loss on curtailment of facility

 

38

 

 

 

1,707

 

Other (income) expense, net

(281

)

(170

)

(97

)

(378

)

(1

)

 

2,033,386

 

1,190,990

 

1,616,055

 

3,649,441

 

2,335,977

 

 

 

 

 

 

 

Income from operations

409,775

 

51,770

 

205,261

 

615,036

 

77,317

 

 

 

 

 

 

 

Foreign currency exchange gain (loss)

147

 

409

 

154

 

301

 

(464

)

Pension expense (excluding service costs)

(19

)

(302

)

(19

)

(38

)

(689

)

Interest expense

(6,347

)

(6,633

)

(5,875

)

(12,222

)

(13,054

)

Interest income

51

 

190

 

59

 

110

 

845

 

Change in fair value of interest rate swaps

(25

)

(514

)

1,024

 

999

 

(2,828

)

 

(6,193

)

(6,850

)

(4,657

)

(10,850

)

(16,190

)

 

 

 

 

 

 

Income before income taxes

403,582

 

44,920

 

200,604

 

604,186

 

61,127

 

Income tax provision

(101,026

)

(11,334

)

(51,448

)

(152,474

)

(15,341

)

Net income

$

302,556

 

$

33,586

 

$

149,156

 

$

451,712

 

$

45,786

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

Basic

39,442

 

39,312

 

39,355

 

39,399

 

39,238

 

Diluted

39,688

 

39,387

 

39,630

 

39,633

 

39,381

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

Basic

$

7.67

 

$

0.85

 

$

3.79

 

$

11.47

 

$

1.17

 

Diluted

$

7.62

 

$

0.85

 

$

3.76

 

$

11.40

 

$

1.16

 

 

 

 

 

 

 

Dividends declared per common share

$

2.10

 

$

0.10

 

$

0.10

 

$

2.20

 

$

0.20

 

Wood Products Segment

Statements of Operations

(in thousands, except percentages) (unaudited)

 

Three Months Ended

Six Months Ended

 

June 30

March 31,

2021

June 30

 

2021

2020

2021

2020

 

 

 

 

 

 

Segment sales

$

594,569

 

$

281,505

 

$

432,335

 

$

1,026,904

 

$

601,566

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

Materials, labor, and other operating expenses (excluding depreciation)

353,916

 

239,626

 

308,608

 

662,524

 

513,660

 

Depreciation and amortization

14,128

 

13,931

 

13,346

 

27,474

 

43,534

 

Selling and distribution expenses

8,835

 

7,552

 

8,999

 

17,834

 

15,536

 

General and administrative expenses

3,872

 

3,451

 

4,319

 

8,191

 

6,463

 

Loss on curtailment of facility

 

38

 

 

 

1,707

 

Other (income) expense, net

57

 

(167

)

11

 

68

 

(171

)

 

380,808

 

264,431

 

335,283

 

716,091

 

580,729

 

 

 

 

 

 

 

Segment income

$

213,761

 

$

17,074

 

$

97,052

 

$

310,813

 

$

20,837

 

 

 

 

 

 

 

 

(percentage of sales)

 

 

 

 

 

 

Segment sales

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

Materials, labor, and other operating expenses (excluding depreciation)

59.5

%

85.1

%

71.4

%

64.5

%

85.4

%

Depreciation and amortization

2.4

%

4.9

%

3.1

%

2.7

%

7.2

%

Selling and distribution expenses

1.5

%

2.7

%

2.1

%

1.7

%

2.6

%

General and administrative expenses

0.7

%

1.2

%

1.0

%

0.8

%

1.1

%

Loss on curtailment of facility

%

%

%

%

0.3

%

Other (income) expense, net

%

(0.1

%)

%

%

%

 

64.0

%

93.9

%

77.6

%

69.7

%

96.5

%

 

 

 

 

 

 

Segment income

36.0

%

6.1

%

22.4

%

30.3

%

3.5

%

Building Materials Distribution Segment

Statements of Operations

(in thousands, except percentages) (unaudited)

 

 

Three Months Ended

 

Six Months Ended

 

 

June 30

 

March 31,

2021

 

June 30

 

 

2021

 

2020

   

2021

 

2020

 

 

 

 

 

 

 

 

 

 

 

Segment sales

 

$

2,172,744

 

 

$

1,134,260

 

 

$

1,634,777

 

 

$

3,807,521

 

 

$

2,184,257

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

Materials, labor, and other operating expenses (excluding depreciation)

 

1,832,929

 

 

982,385

 

 

1,387,351

 

 

3,220,280

 

 

1,900,226

 

Depreciation and amortization

 

5,917

 

 

5,584

 

 

5,819

 

 

11,736

 

 

10,928

 

Selling and distribution expenses

 

121,901

 

 

95,958

 

 

111,920

 

 

233,821

 

 

187,381

 

General and administrative expenses

 

7,230

 

 

7,206

 

 

9,581

 

 

16,811

 

 

13,341

 

Other (income) expense, net

 

(1,571

)

 

(83

)

 

(113

)

 

(1,684

)

 

(131

)

 

 

1,966,406

 

 

1,091,050

 

 

1,514,558

 

 

3,480,964

 

 

2,111,745

 

 

 

 

 

 

 

 

 

 

 

 

Segment income

 

$

206,338

 

 

$

43,210

 

 

$

120,219

 

 

$

326,557

 

 

$

72,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(percentage of sales)

 

 

 

 

 

 

 

 

 

 

 

Segment sales

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

100.0

%

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

 

 

 

Materials, labor, and other operating expenses (excluding depreciation)

 

84.4

%

 

86.6

%

 

84.9

%

 

84.6

%

 

87.0

%

Depreciation and amortization

 

0.3

%

 

0.5

%

 

0.4

%

 

0.3

%

 

0.5

%

Selling and distribution expenses

 

5.6

%

 

8.5

%

 

6.8

%

 

6.1

%

 

8.6

%

General and administrative expenses

 

0.3

%

 

0.6

%

 

0.6

%

 

0.4

%

 

0.6

%

Other (income) expense, net

 

(0.1

)%

 

%

 

%

 

%

 

%

 

 

90.5

%

 

96.2

%

 

92.6

%

 

91.4

%

 

96.7

%

 

 

 

 

 

 

 

 

 

 

 

Segment income

 

9.5

%

 

3.8

%

 

7.4

%

 

8.6

%

 

3.3

%

Segment Information

(in thousands) (unaudited)

 

Three Months Ended

Six Months Ended

 

June 30

March 31,

2021

June 30

 

2021

2020

2021

2020

Segment sales

 

 

 

 

 

Wood Products

$

594,569

 

$

281,505

 

$

432,335

 

$

1,026,904

 

$

601,566

 

Building Materials Distribution

2,172,744

 

1,134,260

 

1,634,777

 

3,807,521

 

2,184,257

 

Intersegment eliminations

(324,152

)

(173,005

)

(245,796

)

(569,948

)

(372,529

)

Total net sales

$

2,443,161

 

$

1,242,760

 

$

1,821,316

 

$

4,264,477

 

$

2,413,294

 

 

 

 

 

 

 

Segment income

 

 

 

 

 

Wood Products

$

213,761

 

$

17,074

 

$

97,052

 

$

310,813

 

$

20,837

 

Building Materials Distribution

206,338

 

43,210

 

120,219

 

326,557

 

72,512

 

Total segment income

420,099

 

60,284

 

217,271

 

637,370

 

93,349

 

Unallocated corporate costs

(10,324

)

(8,514

)

(12,010

)

(22,334

)

(16,032

)

Income from operations

$

409,775

 

$

51,770

 

$

205,261

 

$

615,036

 

$

77,317

 

 

 

 

 

 

 

Segment EBITDA (a)

 

 

 

 

 

Wood Products

$

227,889

 

$

31,005

 

$

110,398

 

$

338,287

 

$

64,371

 

Building Materials Distribution

212,255

 

48,794

 

126,038

 

338,293

 

83,440

 

See accompanying summary notes to consolidated financial statements and segment information.

Boise Cascade Company

Consolidated Balance Sheets

(in thousands) (unaudited)

 

June 30, 2021

December 31, 2020

 

 

ASSETS

 

 

 

 

 

Current

 

 

Cash and cash equivalents

$

653,767

$

405,382

Receivables

 

 

Trade, less allowances of $2,513 and $1,111

592,953

375,865

Related parties

412

201

Other

16,785

15,067

Inventories

727,205

503,480

Prepaid expenses and other

16,308

8,860

Total current assets

2,007,430

1,308,855

 

 

 

Property and equipment, net

457,291

461,456

Operating lease right-of-use assets

57,650

62,447

Finance lease right-of-use assets

28,146

29,523

Timber deposits

7,469

11,761

Goodwill

60,382

60,382

Intangible assets, net

15,962

16,574

Deferred income taxes

7,261

7,460

Other assets

5,849

7,260

Total assets

$

2,647,440

$

1,965,718

Boise Cascade Company

Consolidated Balance Sheets (continued)

(in thousands, except per-share data) (unaudited)

 

June 30, 2021

December 31, 2020

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

Current

 

 

Accounts payable

 

 

Trade

$

507,237

 

$

307,653

 

Related parties

2,811

 

1,199

 

Accrued liabilities

 

 

Compensation and benefits

116,596

 

118,400

 

Income taxes payable

15,460

 

8,101

 

Interest payable

9,879

 

8,477

 

Dividends payable

78,662

 

 

Other

123,612

 

80,172

 

Total current liabilities

854,257

 

524,002

 

 

 

 

Debt

 

 

Long-term debt

444,210

 

443,792

 

 

 

 

Other

 

 

Compensation and benefits

28,312

 

25,951

 

Operating lease liabilities, net of current portion

50,967

 

56,001

 

Finance lease liabilities, net of current portion

30,661

 

31,607

 

Deferred income taxes

7,378

 

18,263

 

Other long-term liabilities

15,945

 

15,303

 

 

133,263

 

147,125

 

 

 

 

Commitments and contingent liabilities

 

 

 

 

 

Stockholders’ equity

 

 

Preferred stock, $0.01 par value per share; 50,000 shares authorized, no shares issued and outstanding

 

 

Common stock, $0.01 par value per share; 300,000 shares authorized, 44,698 and 44,568 shares issued, respectively

447

 

446

 

Treasury stock, 5,367 shares at cost

(138,909

)

(138,909

)

Additional paid-in capital

538,841

 

538,006

 

Accumulated other comprehensive loss

(1,085

)

(1,078

)

Retained earnings

816,416

 

452,334

 

Total stockholders’ equity

1,215,710

 

850,799

 

Total liabilities and stockholders’ equity

$

2,647,440

 

$

1,965,718

 

Boise Cascade Company

Consolidated Statements of Cash Flows

(in thousands) (unaudited)

 

Six Months Ended June 30

 

2021

2020

Cash provided by (used for) operations

 

 

Net income

$

451,712

 

$

45,786

 

Items in net income not using (providing) cash

 

 

Depreciation and amortization, including deferred financing costs and other

40,826

 

56,295

 

Stock-based compensation

3,503

 

3,345

 

Pension expense

38

 

1,023

 

Deferred income taxes

(10,481

)

(1,501

)

Change in fair value of interest rate swaps

(999

)

2,828

 

Loss on curtailment of facility (excluding severance)

 

1,476

 

Other

1,017

 

164

 

Decrease (increase) in working capital

 

 

Receivables

(219,112

)

(129,532

)

Inventories

(225,006

)

41,102

 

Prepaid expenses and other

(7,448

)

(6,989

)

Accounts payable and accrued liabilities

248,139

 

95,505

 

Pension contributions

(153

)

(1,062

)

Income taxes payable

7,253

 

8,616

 

Other

1,890

 

1,220

 

Net cash provided by operations

291,179

 

118,276

 

 

 

 

Cash provided by (used for) investment

 

 

Expenditures for property and equipment

(31,502

)

(28,849

)

Proceeds from sales of assets and other

500

 

406

 

Net cash used for investment

(31,002

)

(28,443

)

 

 

 

Cash provided by (used for) financing

 

 

Borrowings of long-term debt, including revolving credit facility

28,000

 

 

Payments of long-term debt, including revolving credit facility

(28,000

)

 

Dividends paid on common stock

(8,373

)

(8,562

)

Tax withholding payments on stock-based awards

(2,729

)

(3,309

)

Other

(690

)

(1,763

)

Net cash used for financing

(11,792

)

(13,634

)

 

 

 

Net increase in cash and cash equivalents

248,385

 

76,199

 

 

 

 

Balance at beginning of the period

405,382

 

285,237

 

 

 

 

Balance at end of the period

$

653,767

 

$

361,436

 

Summary Notes to Consolidated Financial Statements and Segment Information

The Consolidated Statements of Operations, Segment Statements of Operations, Consolidated Balance Sheets, Consolidated Statements of Cash Flows, and Segment Information presented herein do not include the notes accompanying the Company’s Consolidated Financial Statements and should be read in conjunction with the Company’s 2020 Form 10-K and the Company’s other filings with the Securities and Exchange Commission. Net income for all periods presented involved estimates and accruals.

(a)

EBITDA represents income before interest (interest expense and interest income), income taxes, and depreciation and amortization. Additionally, we disclose Adjusted EBITDA, which further adjusts EBITDA to exclude the change in fair value of interest rate swaps. The following table reconciles net income to EBITDA and Adjusted EBITDA for the three months ended June 30, 2021 and 2020, and March 31, 2021, and the six months ended June 30, 2021 and 2020:

 

Three Months Ended

Six Months Ended

 

June 30

March 31,

2021

June 30

 

2021

2020

2021

2020

 

(in thousands)

Net income

$

302,556

 

$

33,586

 

$

149,156

 

$

451,712

 

$

45,786

 

Interest expense

6,347

 

6,633

 

5,875

 

12,222

 

13,054

 

Interest income

(51

)

(190

)

(59

)

(110

)

(845

)

Income tax provision

101,026

 

11,334

 

51,448

 

152,474

 

15,341

 

Depreciation and amortization

20,420

 

19,899

 

19,539

 

39,959

 

55,231

 

EBITDA

430,298

 

71,262

 

225,959

 

656,257

 

128,567

 

Change in fair value of interest rate swaps

25

 

514

 

(1,024

)

(999

)

2,828

 

Adjusted EBITDA

$

430,323

 

$

71,776

 

$

224,935

 

$

655,258

 

$

131,395

 

The following table reconciles segment income and unallocated corporate costs to EBITDA and adjusted EBITDA for the three months ended June 30, 2021 and 2020, and March 31, 2021, and the six months ended June 30, 2021 and 2020:

 

Three Months Ended

Six Months Ended

 

June 30

March 31,

2021

June 30

 

2021

2020

2021

2020

 

(in thousands)

Wood Products

 

 

 

 

 

Segment income

$

213,761

 

$

17,074

 

$

97,052

 

$

310,813

 

$

20,837

 

Depreciation and amortization

14,128

 

13,931

 

13,346

 

27,474

 

43,534

 

EBITDA

$

227,889

 

$

31,005

 

$

110,398

 

$

338,287

 

$

64,371

 

 

 

 

 

 

 

Building Materials Distribution

 

 

 

 

 

Segment income

$

206,338

 

$

43,210

 

$

120,219

 

$

326,557

 

$

72,512

 

Depreciation and amortization

5,917

 

5,584

 

5,819

 

11,736

 

10,928

 

EBITDA

$

212,255

 

$

48,794

 

$

126,038

 

$

338,293

 

$

83,440

 

 

 

 

 

 

 

Corporate

 

 

 

 

 

Unallocated corporate costs

$

(10,324

)

$

(8,514

)

$

(12,010

)

$

(22,334

)

$

(16,032

)

Foreign currency exchange gain (loss)

147

 

409

 

154

 

301

 

(464

)

Pension expense (excluding service costs)

(19

)

(302

)

(19

)

(38

)

(689

)

Change in fair value of interest rate swaps

(25

)

(514

)

1,024

 

999

 

(2,828

)

Depreciation and amortization

375

 

384

 

374

 

749

 

769

 

EBITDA

(9,846

)

(8,537

)

(10,477

)

(20,323

)

(19,244

)

Change in fair value of interest rate swaps

25

 

514

 

(1,024

)

(999

)

2,828

 

Corporate adjusted EBITDA

$

(9,821

)

$

(8,023

)

$

(11,501

)

$

(21,322

)

$

(16,416

)

 

 

 

 

 

 

Total Company adjusted EBITDA

$

430,323

 

$

71,776

 

$

224,935

 

$

655,258

 

$

131,395

 

 

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