BlueLinx (BXC) 8-K Results of Operations and Financial Condition

Exhibit 99.1

4300 Wildwood Parkway
Atlanta, GA 30339
1-888-502-BLUE
www.BlueLinxCo.com

BlueLinx Contacts:
David Morris, CFO & Treasurer	Jim Storey, Investor Relations
BlueLinx Holdings Inc.	BlueLinx Holdings Inc.
(770) 221-2668	(770) 612-7169

FOR IMMEDIATE RELEASE

 
BLUELINX ANNOUNCES FIRST-QUARTER RESULTS
— Net Income Climbs 16.4% On 1.8% Revenue Increase —
— Specialty Product Unit Volume Up 14.9% From Prior Year —

ATLANTA — May 4, 2006 — BlueLinx Holdings Inc. (NYSE: BXC), a leading distributor of building products in North America, today reported financial results for the first quarter ended April 1, 2006.

Revenues for the first quarter rose 1.8% to $1.38 billion from $1.35 billion for the first quarter of 2005. The increase reflects a 15.7% increase in specialty product sales, partially offset by a 5.6% decline in structural product sales. Specialty product sales were driven by a 14.9% increase in unit volume over the same period a year earlier. This unit-volume increase represented approximately 94% of the first-quarter specialty sales increase, with the remaining contribution resulting from higher prices. In structural products, declining product prices accounted for the majority of the sales decrease, while unit volume also was down slightly.

First-quarter net income rose to $9.8 million, or $0.32 per diluted share, from $8.4 million, or $0.28 per diluted share, for the same period a year ago.

Gross profit for the first quarter rose to $130 million from $119.3 million in the prior-year period. Gross margin improved 60 basis points, to 9.4% from 8.8% a year ago, reflecting growth in higher-margin specialty products. Total operating expenses of $102.3 million for the first quarter increased $6.6 million from the same period a year ago, primarily reflecting normal ongoing operating expenses associated with the company’s Lane Stanton Vance (LSV) division, the specialty hardwoods distributor that the company acquired in July 2005. Operating income for the quarter was $27.6 million, compared with $23.7 million for the first quarter last year.

“We made steady progress toward our primary strategic objectives during the first quarter,” said Stephen Macadam, chief executive officer. “We accelerated growth of our specialty products business, increasing unit volume by 14.9% from the same period a year ago, and we effectively managed our structural inventory in a generally declining pricing environment.

“We are well positioned to continue to grow specialty product unit volume and effectively manage our structural product business, ” Macadam said. “We finished the first quarter with structural product inventories 16.8%

below year-ago levels, and we are moving forward into the second quarter continuing to tightly manage our inventory levels. At the same time, we continue to execute on our primary strategic objective, which is to grow specialty product revenue to more than 60% of our total product mix.”

Dividend
On May 3, 2006, the BlueLinx Board of Directors declared a $0.125 dividend on the company’s common shares for the quarter ended April 1, 2006. The dividend is payable on June 30, 2006, to shareholders of record on June 15, 2006.

Conference Call
BlueLinx will host a conference call today at 9:00 a.m. Eastern Time, accompanied by a supporting slide presentation. Investors may listen to the conference call and download the presentation by going to the Investor Relations page of the BlueLinx Web site, at www.BlueLinxCo.com. Investors also can access a recording of the conference call for one week by calling 706-645-9291, Conference ID# 8269019. The recording will be available two hours after the conference call has concluded. Investors also can access a recording of this call on the BlueLinx Web site where a replay of the Webcast will be available for 90 days.

About BlueLinx Holdings Inc.
Headquartered in Atlanta, Georgia, BlueLinx Holdings Inc., operating through its wholly owned subsidiary BlueLinx Corporation, is a leading distributor of building products in North America. Employing more than 3,600 people in North America, BlueLinx offers 10,000 products from over 750 suppliers to service approximately 12,000 customers nationwide, including dealers, industrial manufacturers, manufactured housing producers and home improvement retailers. The company operates its distribution business from sales centers in Atlanta and Denver, and its network of more than 65 warehouses. Additional information about BlueLinx can be found on its Web site at www.BlueLinxCo.com.

Forward-looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All of these forward-looking statements are based on estimates and assumptions made by our management that, although believed by BlueLinx to be reasonable, are inherently uncertain. Forward-looking statements involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors outside of its control, that may cause its business, strategy or actual results to differ materially from the forward-looking statements. These risks and uncertainties may include, among other things: changes in the supply and/or demand for products that we distribute; the activities of competitors; changes in significant operating expenses; changes in the availability of capital; the ability to identify acquisition opportunities and effectively and cost-efficiently integrate acquisitions; general economic and business conditions in the United States; adverse weather patterns or conditions; acts of war or terrorist activities; variations in the performance of the financial markets; and other factors described in the “Risk Factors” section in the company’s Annual Report on Form 10-K for the year ended December 31, 2005, and in its periodic reports filed with the Securities and Exchange Commission from time to time. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. BlueLinx undertakes no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

- Tables to Follow -

BlueLinx Holdings Inc.
Statements of Operations
in thousands, except per share data

	Quarters Ended
	April 1,		April 2,
	2006		2005
	(unaudited)		(unaudited)
Net sales	$	1,376,606	$	1,351,619
Cost of sales		1,246,654		1,232,291
Gross profit		129,952		119,328
Operating expenses:
Selling, general, and administrative		97,267		91,435
Depreciation and amortization		5,043		4,243
Total operating expenses		102,310		95,678
Operating income		27,642		23,650
Non-operating expenses:
Interest expense		11,197		9,334
Other expense, net		81		129
Income before provision for income taxes		16,364		14,187
Provision for income taxes		6,569		5,769
Net income	$	9,795	$	8,418
Basic weighted average number of common shares outstanding		30,417		30,155
Basic net income per share applicable to common stock	$	0.32	$	0.28
Diluted weighted average number of common shares outstanding		30,713		30,458
Diluted net income per share applicable to common stock	$	0.32	$	0.28
Dividends declared per share of common stock	$	0.125	$	0.125

BlueLinx Holdings Inc.
Balance Sheets
in thousands

	April 1,			December 31,
	2006			2005
	(unaudited)			(audited)
Assets:
Current assets:
Cash	$	27,434		$	24,320
Receivables, net		480,466			399,093
Inventories, net		501,152			473,068
Deferred income taxes		6,491			6,678
Other current assets		40,998			44,909
Total current assets		1,056,541			948,068
Property, plant, and equipment:
Land and land improvements		56,461			56,521
Buildings		93,472			93,381
Machinery and equipment		56,160			54,200
Construction in progress		834			2,350
Property, plant, and equipment, at cost		206,927			206,452
Accumulated depreciation		(26,472	)		(22,403	)
Property, plant, and equipment, net		180,455			184,049
Other non-current assets		24,368			25,523
Total assets	$	1,261,364		$	1,157,640
Liabilities:
Current liabilities:
Accounts payable	$	352,902		$	327,004
Bank overdrafts		49,570			62,392
Accrued compensation		10,655			13,494
Current maturities of long-term debt		75,769			—
Other current liabilities		14,165			15,195
Total current liabilities		503,061			418,085
Non-current liabilities:
Long-term debt		550,000			540,850
Deferred income taxes		971			1,911
Other long-term liabilities		14,637			12,942
Total liabilities		1,068,669			973,788
Shareholders’ Equity:
Common stock		306			303
Additional paid in capital		135,249			132,346
Accumulated other comprehensive income		996			1,023
Retained earnings		56,144			50,180
Total shareholders’ equity		192,695			183,852
Total liabilities and shareholders’ equity	$	1,261,364		$	1,157,640

BlueLinx Holdings Inc.
Statements of Cash Flows
in thousands

	Quarters Ended
	April 1,			April 2,
	2006			2005
	(unaudited)			(unaudited)
Cash flows from operating activities:
Net income	$	9,795		$	8,418
Adjustments to reconcile net income to cash used in operations:
Depreciation and amortization		5,043			4,243
Amortization of debt issue costs		765			1,005
Deferred income tax benefit		(753	)		(1,102	)
Stock compensation		562			832
Changes in assets and liabilities:
Receivables		(81,373	)		(135,735	)
Inventories		(28,084	)		(17,682	)
Accounts payable		25,898			68,087
Changes in other working capital		42			(9,465	)
Other		1,704			(54	)
Net cash used in operating activities		(66,401	)		(81,453	)
Cash flows from investing activities:
Property, plant, and equipment investments		(658	)		(2,048	)
Proceeds from sale of assets		135			140
Net cash used in investing activities		(523	)		(1,908	)
Cash flows from financing activities:
Issuance of common stock, net		—			8,600
Proceeds from stock options exercised		2,341			—
Net increase in revolving credit facility		84,919			75,144
Debt financing costs		(569	)		—
Increase (decrease) in bank overdrafts		(12,822	)		6,524
Common dividends paid		(3,831	)		(3,773	)
Net cash provided by financing activities		70,038			86,495
Increase in cash		3,114			3,134
Balance, beginning of period		24,320			15,572
Balance, end of period	$	27,434		$	18,706