Exhibit 99.1
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0001.gif)
Dallas |
Austin |
BlueLinx Investor Book November 2006 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0002.gif)
Safe Harbor Statement |
Forward-Looking Statement Safe Harbor —This presentation 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 which 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 fiscal year ended December 31, 2005, and in its periodic reports filed with the SEC. In addition, the statements in this presentation are made as of November 15, 2006. The Company expects that subsequent events or developments will cause its views to change. The Company undertakes no obligation to update any of the forward-looking statements made herein, whether as a result of new information, future events, changes in expectation or otherwise. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to November 15, 2006. Use of Non-GAAP and Pro Forma* Financial Information- To supplement GAAP financial statements, the Company uses non-GAAP, or pro forma measures of operating results. This non-GAAP, or pro forma financial information is provided as additional information for investors and is not in accordance with or an alternative to GAAP. These adjusted results exclude certain costs, expenses, gains and losses, and we believe their exclusion can enhance an overall understanding of our past financial performance and also our prospects for the future. These adjustments to our GAAP results are made with the intent of providing both management and investors a more complete understanding of the operating performance of the Company as opposed to GAAP results, which may include nonrecurring, infrequent or other non-cash charges that are not material to the ongoing performance ofthe Company’s business. Company management uses these non-GAAP and pro forma results as a basis for planning and forecasting core business activity in future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net earnings, diluted earnings per share or net cash provided by (used in) operating activities prepared in accordance with generally accepted accounting principles in the United States. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0003.gif)
BlueLinx Investor BookNovember 2006 |
BlueLinx OverviewIndustry DynamicsFocused Growth Strategy2006 Q3 UpdateLooking Forward |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0004.gif)
BlueLinx Overview: |
Operations Largest Building Products Distributor in U.S.NYSE: BXC 2005 Revenue: $5.6 BillionAnalysts Covering: 8 |
~12,000 customers and 750+ suppliersMarket Cap: $308.5 |
Product portfolio 10,000+ SKUsShares Outstanding: 30.8 (diluted) |
70+ warehouses; 80+ reloadsDividend/Yield: $.50/5.0% Owned fleet of 900 trucks and 1,200 trailersP/E (ttm) 8.5 |
3,400 employees, including 900+ sales * Based on 11/03/06 close of $10.02 |
Sales Center Warehouse LSV |
Austin Hardwoods 4 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0005.gif)
BlueLinx Overview:Evolution of BlueLinx Growth Strategy1954 — 1976 1977 — 19931994 — 20002001 — 2003 2004 — Future DiversifiedCentralized, Improve “Masters” Outlet for GP building nationwide Gross of the Plywood products distribution Margin &nbs p; supply chain distributor transition Georgia-Pacific through May 7, 2004BlueLinx |
DecentralizedDecentralizedSystemRationalizedCentralized platform structure structure rationalized & customer supports market centralized base share growth |
13 warehouses134 warehouses63 warehousesIncreasedOrganic growth gross margin focus supplementedIntegrated IT by 225 basis by acquisitions systemspointsValue proposition:>$400mm one- reduce supply chain time investment costs by GP in systems and infrastructure |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0006.gif)
BlueLinx Overview: |
Evolving to Achieve Our ObjectivesFROM: TO: |
Commodities-focused, Customer-focused, distribution arm of solutions-driven, value-manufacturer added distribution partner |
55%+ structural products 60%+ specialty products |
Volume orientation Profit orientation |
Structural products- Specialty products-driven driven earnings volatility stable earnings growth Managing through Managing to create maximum complex internal value in the supply chain transformations Developing integrated Leveraging management management systems systems to create value |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0007.gif)
BlueLinx Overview: |
Positioned at the Center of Value Creation |
Manufactured Housing / Industrial |
Residential Building and Non-Products BlueLinx Dealers Residential Manufacturers Construction |
Home |
Repair and Improvement Remodeling Centers |
Benefits to ManufacturersBenefits to Customers |
Reliable channels to marketReliable source of many materials |
Consistent production runsBreak bulk quantities |
Limits inventory investmentNear 100% fill rates |
Allows limited number of customersLimits vendors and inventory investment |
Limits credit risk and receivableJust in time deliveries investment |
Safety stock |
Ability to create markets for early life cycle products |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0008.gif)
BlueLinx Overview: |
Diversified Product, Customer & End Use Segments |
Product Categories Customer CategoriesEnd Use Segments |
Non Residential Construction 5% Engineered lumber InsulationHome Center Hardboard Manufactured Specialty lumber Manufactured DeckingHousing Vinyl siding Specialty HousingRepair & Millwork8% Hardwood plywood 45% Remodeling ParticleboardDoors Industrial 15% Moulding Sanded plywood Metal products Softboard Industrial Structural siding Applications 22% |
Plywood |
Structural OSB |
55%DealerNew Home Lumber Construction Rebar/Remesh 50% |
~ 10,000 Products ~ 12,000 Customers5 End Use Segments |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0009.gif)
BlueLinx Overview: |
Diversified Product, Vendor Relationships |
Diverse & Growing Supply Base: World Class, Loyal Customers: 750+ Vendor Partners 12,000+ Customer Partners |
National Home Centers |
National Dealers |
Regional Dealers |
Industrials/ Manufactured Housing |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0010.gif)
BlueLinx Overview: |
Strategic Objectives |
Profitably grow specialty revenues to 60+ % of total sales |
Profitably grow structural margin dollars while reducing exposure to volatility |
Outgrow the market over the long term |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0011.gif)
BlueLinx Overview: |
Experienced Leadership TeamManagement Team Leadership Background Stephen Macadam CEO Strategy |
CEO Consolidated Container; EVPGeorgia-Pacific; McKinsey & Co. |
George Judd COO OperationsVP Eastern operations, Georgia-Pacific;inside and outside sales manager, national accounts manager |
David Morris CFO FinanceVP Finance, Georgia-Pacificdistribution division; Kimberly-Clark |
Steve Skinner SVP Business Development |
CEO Peppers & Rogers Group,McKinsey & Co. Duane Goodwin SVP Supply Chain |
Home Depot, Wal-Mart, procurementand sourcing |
Dave Dalton SVP Western Region Regional VP BlueLinx; division sales, |
management, Georgia-Pacific |
Sam Gaddis VP National Accounts Georgia-Pacific / BlueLinx, regional |
account manager, director national accounts 6 Regional VPs RVP Regional Operations/Sales |
Average 20+ years of industryexperience |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0012.gif)
BlueLinx Overview: How We Think About Our Business Going Forward |
2006 Update |
Q3 housing starts and permits down sharply Housing starts down 18.7% from year ago Permits down 23.2% from year ago |
Category Jan Feb Mar Apr May Jun Jul Aug Sep Starts 2.265 M 2.132 1.972 1.832 1.953 1.841 1.772 1,665 1,772 Permits 2.195 M 2.147 2.085 1.973 1.946 1.869 1.763 1.722 1,619 |
Q3 wood-based structural product prices continued falling — near lows, but sustained rebound unlikely |
Expect housing starts at 1.8-1.9 million for year |
This is a text box |
Expect housing decline to be partially offset by strength in other end-use sectorsGrow Specialty Unit Volume Vs. End-Use Markets |
BXC Growth StrategyBXC Specialty Growth Estimated Weighted = percentage point spread End-Use Market Growth |
Work to partially offset impact of housing slowdown and structural price declines with18.0%product mix and Specialty share gains14.0% |
10.0% 6.0 |
Continue to grow Specialty Product unit12.3volume relative to end-use markets6.0% |
11.4 8.7 |
Focus on industrial and geographic2.0% |
market penetrationUnit Volume Growth % (2.0%) |
Effectively manage Structural Product(6.0%) 4.8inventory for profitability and to mitigate risk(10.0%) |
Q4 Q1 Q2Q3TTM |
Remove costs and right size company for2005 2006 2006 2006slower housing start environment |
12 |
Manage costs diligently |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0013.gif)
BlueLinx Investor Book |
November 2006BlueLinx OverviewIndustry DynamicsFocused Growth Strategy2006 Q3 UpdateLooking Forward |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0014.gif)
Growing & Attractive Industry: |
Solid Long-Term Industry Fundamentals |
Annual Housing Starts Annual Unit Volume Growth In (mm)Other End-Use Markets |
Industrial |
Repair & Remodeling |
Mobile homes |
1.9 |
1.8Non-residential |
1.4 2.8% |
1.9% |
1.8% |
1991-2000 2001-2005 2006E- 1991-2000 2001-20052006E- AvgAvg 2015E Avg Avg Avg2015E Avg |
50% of Our End-Market50% of Our End-Market |
Source: Research Information Systems Inc. (RISI) August 2006 |
14 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0015.gif)
Growing & Attractive Industry: |
Market Growth of Two-Step Distribution |
50$48.7 $46.1 45 |
40 $38.4 |
$35.4 $ billions 35 $33.8 30 |
25 20 2001 2002 2003 2004 2005 |
Total Market Revenue |
Source: Home Channel News, July 2006 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0016.gif)
Growing & Attractive Industry: |
Largest in a Highly Fragmented Industry, Ripe for Consolidation |
Highly Fragmented Industry Many Small and Medium Sized Players 2005 Market Share Number of Competitors By Revenue* |
BlueLinx |
11.5%100’s |
Weyerhaeuser 10.0% |
Boise Cascade 6.9% |
Universal FP 4.4% Huttig 2.3% Other |
13 |
64.9% |
Consists of several6 5hundred small, local3distributors |
<$250m $250m — $500m — $1bn- >$2.5bn $500m$1bn $2.5bn |
Source: Home Channel News, July 2006 * Based on 2004 revenues |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0017.gif)
BlueLinx Investor Book |
November 2006BlueLinx OverviewIndustry DynamicsFocused Growth Strategy2006 Q3 UpdateLooking Forward |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0018.gif)
Focused Growth Strategy: |
BXC Strategic FrameworkMission: Strategy Initiatives and Enablers: |
Gross Margin Improvement |
Cost Improvement“Be the Masters of the Supply |
Improvement Productivity ImprovementChain for those productsEfforts Asset Managementwe choose to distribute.”Value Proposition: Product & Vendor Mgmt. |
· Provide the lowest total cost |
Marketing Excellence of sales and distribution through the supply chain Sales Processes & SupportStrategic Information Technology |
· Drive end-user demand,Enablers Results Tracking & Accountability thereby increasing sales forTalent Development & Acquisition our customers and our suppliersObjectives: Accelerate Specialty growth Target high-growth accounts Gross Margin: 10+%Growth Increase volume in high-return Specialty Mix: 60+%Initiativessegments Unit Sales: Outgrow the market Pursue supplemental acquisitions |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0019.gif)
Focused Growth Strategy:Specialty Products -Four-Part StrategyTeam with Manufacturers to Introduce New Products |
Continuing national roll-out of Louisiana-Pacific’s WeatherBest composite decking |
Beginning distribution of L-P’s SmartSide engineered wood siding, soffit and trim |
Roll out includes SteelLinx metal products, Tanza trim, AmericanElegance cabinets |
Launching strategic hardwood plywood relationship with Columbia Forest Products |
Executing systematic, disciplined approach to develop product portfolioFurther Penetrate Geographic Markets Expanding specialty products into new geographic markets |
Putting people and products in place to capitalize on opportunities in western markets |
Grow Share in Under-Represented Market Segments |
Actively executing market-by-market initiative to grow presence in industrials (customers whouse building products in the manufacturing process (cabinets, furniture, fixtures, containers, concrete forms, etc.) |
Industrials represent approximately 22% of our end-use markets and BXC has about 3% market share |
Industrials are well suited to the BlueLinx value proposition and specialty products focus |
Pursue Acquisitions as a Patient, Disciplined Acquirer |
Acquired specialty hardwood distributors Austin Hardwoods in Texas and California-based Lane Stanton Vance |
Actively looking |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0020.gif)
Focused Growth Strategy : |
Diversified, Market Relevant Specialty Products — Recent Launches |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0021.gif)
Focused Growth Strategy: |
Structural Products -Effective Inventory Management |
Focus on improved profitability and reduced risk |
Q3 structural inventory down 10% from year ago |
Increased utilization of consignment and program inventories |
Expanding imports from Europe and other areas offering lowest-cost sourcing |
Driving OSB business through direct channel |
Focusing on structural products with “specialty product” characteristics |
Long-length lumber Specialty plywood MSR lumber |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0022.gif)
Focused Growth Strategy: |
Outgrow the Market Over the Long Term |
Unit Volume Growth vs. End-Use |
Market Year over Year Change Market Share Growth* |
Weighted End-Use Market Growth BlueLinx Growth |
12.1% |
8.2% 11.5% 11.1% |
4.7% 4.4% 3.9% 2.5% 2.0% |
-0.7% -1.9% |
2003 2004 2005 Q3 ‘06(TTM) 2003 2004 2005 |
*Source: Home Channel News, July 2006 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0023.gif)
Focused Growth Strategy: |
Total Volume Growth vs. Market |
BXC Growth Estimated Weighted #’s on graph equal percentage point spread End-Use Market Growth |
14.0% |
10.0% |
6.0% |
(1.7) 2.4 2.0% |
(1.2) (2.0%) (2.0) Unit Volume Growth % (6.0%) (10.0%) (3.3) (14.0%) Q4 Q1 Q2 Q3 TTM |
2005200620062006 |
BlueLinx continues to focus on growing specialty unit volume |
In the face of declining wood-based structural product prices, BlueLinx is focusing on maintaining profitability in structural products |
End-use markets weakened in Q3, as housing starts declined year-over-year by 18.7%, partially offset by strength in industrial and repair & remodel markets |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0024.gif)
Focused Growth Strategy: |
Specialty Volume Growth vs. Market |
BXC Specialty Growth Estimated Weighted = percentage point spread End-Use Market Growth |
18.0% 14.0% |
10.0% 6.0 |
12.3 6.0% |
11.4 8.7 2.0% Unit Volume Growth % (2.0%) (6.0%) 4.8 |
(10.0%) Q4Q1Q2 Q3 TTM 2005 2006 2006 2006 |
Continued specialty share gains reflect: Growth in new products |
Growth in existing products including moulding, particle board and specialty lumber |
Q3 4.8 percentage point spread comprises approximately 4 points in organic growth, with the remainder contributed by acquisitions (LSV & Austin |
Hardwoods) 24 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0025.gif)
BlueLinx Investor BookNovember 2006BlueLinx OverviewIndustry DynamicsFocused Growth Strategy2006 Q3 UpdateLooking Forward |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0026.gif)
2006 Q3 Update (Vs. Year Ago): Executing Our Plan In A Cyclical Housing Start Correction |
Revenue: Dn 17.2% to $1.2 billion |
Specialty down 1.1% — 45% of Total Rev, 62% of GM Structural dn 26.8% |
Unit Volume: Total Dn 12% |
Specialty dn3.9% — Structural dn 17% End-use markets dn8.7% |
Gross margin: Total 10% vs. 9.4% |
Specialty 14% — Structural 7% |
Inventory: Total $471.2 million, up 12.5% |
Specialty up 28% — Structural reduced 6% |
Net income: $2.3 million-$0.07/shr vs. $13.9 million-$0.46/shr |
(Q3’06 includes $1.4 million-$0.05/shr charge for severance costs) |
Working capital |
turn days: 50 vs. year-ago 40 |
Total debt: down $21 million vs. year ago26 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0027.gif)
2006 Q3 Update :Accelerating Specialty GrowthUnit Volume Growth Gross Margin Structural Specialty End-Use Markets Structural Specialty |
14.3% 13.9% 14.4% 14.0% 12.7% 14.9% 13.3% 12.6% 12.9% 9.6% 6.6% 5.8% 4.2% 8.3% 7.0% 7.3% 6.8% 7.0% 7.0% 1.7% 0.2% -3.9% 5.3% 0.5% 0.9% -0.8% |
-11.3% |
-17.0% |
Q1 ‘05 Q2 ‘05 Q3 ‘05 Q4 ‘05 Q1 ‘06 Q2 ‘06 Q3’06 Q1 ‘05 Q2 ‘05 Q3 ‘05 Q4 ‘05 Q1 ‘06 Q2 ‘06 Q3 ‘06 |
Specialty Products % of Total Revenue % of GM |
64% |
61% 62% 62% 54% 55% 53% 45% 42% 43% 41% 39% 37% 36% |
Q1 ‘05 Q2 ‘05 Q3 ‘05 Q4 ‘05 Q1 ‘06 Q2 ‘06 Q3 ‘0627 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0028.gif)
BlueLinx Investor BookNovember 2006BlueLinx OverviewIndustry DynamicsFocused Growth Strategy2006 Q3 UpdateLooking Forward |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0029.gif)
Looking Forward: |
Go-Forward Initiatives |
Expand relationships with existing and new specialty product vendors who recognize the BlueLinx value proposition |
Continue and improve disciplined inventory management to help mitigate price volatility impact on structural products |
Target growing accounts that serve attractive high-growth markets |
Increase volume in under represented segments, e.g., industrials |
Tightly manage costs, but continue to invest in the people, processes and inventory necessary to support specialty business growth |
Be a patient, disciplined acquirer |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0030.gif)
BXC Investment Considerations: |
Largest independent building products distributor in highly fragmented industry ripe for consolidation |
Positioned at the center of the supply chain to create maximum value for both manufacturers and customers |
Diversified products, customers & end use segments |
Solid long-term industry fundamentals |
Demonstrated progress in growing specialty products business and effectively managing structural products business |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0031.gif)
Appendix |
TOPIC PAGE |
Fundamentals 32 Revenues by Quarter 33 Unit Volume Growth by Quarter 34 Market Growth by Quarter 35 Gross Margin by Quarter 36 Income by Quarter 37 Inventory by Quarter 38 Quarterly Volume by Region 39 Year to Date Volume by Region 40 Gross Margin % Analysis 41 Channel Mix Analysis 42 Structural Product Price Trends 43 Capital Structure Position 44 |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0032.gif)
BlueLinx Holdings Inc. |
Fundamentals* |
TRADING VALUATION |
NYSE: BXCDividend/yield $0.50/5.0% 8 Analysts Providing ResearchDebt to Total Capital 76% (9/30/06) Market Capitalization $308.5 millionCash per share $0.79 (9/30/06) Shares Outstanding 30.8 million (diluted)Book value per share $6.41 (9/30/06) Avg. Daily Trading Vol. 205,000 (3 m)P/E Ratio (ttm) 8.5 Float (%) 33Return on Equity (ttm) 20% |
(NI(ttm)/AvgBeginning & Ending Equity) |
52-Week Range $16.95 (3/14/06) —$8.80 (10/12/06) |
* As of 11/03/06 closing price of $10.02, except where noted |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0033.gif)
BlueLinx Holdings Inc. Revenues by Quarter Sales $ in millions 2004(1) 2005 2006 2003(1) 2004(1) 2005 TTM |
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Specialty(2) $ 473.9 $ 501.1 $ 542.6 $ 559.9 $ 539.5 $ 580.0 $ 603.3 $ 553.5 $1,688.8 $1,959.8 $2,143.1 $2,276.3 |
Structural754.9 861.2 960.7 910.6 815.2 813.4 $ 798.7 $ 666.7 2,636.0 3,656.5 3,547.7 3,094.0 |
Other(3) (21.2) (10.7) (16.3) (16.3) (25.4) (16.8) (23.0) (16.6) (53.0) (58.1) (68.7) (81.8) |
Total$1,207.6 $1,351.6 $1,487.0 $1,454.2 $1,329.3 $1,376.6 $1,379.0 $1,203.6 $4,271.8 $5,558.2 $5,622.1 $5,288.5 |
Structural |
Plywood $ 211.2 $ 244.8 $ 255.2 $ 243.6 $ 217.2 $ 215.4 $ 209.5 $ 188.7 $ 861.5 $1,083.2 $ 960.8 $ 830.8 |
OSB 132.6 184.9 213.1 196.8 205.7 198.5 169.4 114.4 609.2 743.2 800.5 688.0 |
Lumber 319.3 337.7 381.1 369.3 309.2 311.8 294.8 245.9 930.9 1,399.4 1,397.3 1,161.7 |
Sub Total 663.1 767.4 849.4 809.7 732.1 725.7 673.7 549.0 2,401.6 3,225.8 3,158.6 2,680.5 |
Rebar/Remesh 91.8 93.8 111.3 100.9 83.1 87.7 125.0 117.7 234.4 430.7 389.1 413.5 |
Total $ 754.9 $ 861.2 $ 960.7 $ 910.6 $ 815.2 $ 813.4 $ 798.7 $ 666.7 $2,636.0 $3,656.5 $3,547.7 $3,094.0 |
Structural Unit Sales Structural |
Plywood 659,765 725,511 757,948 693,328 602,037 659,798 657,679 637,932 2,914,926 2,984,967 2,778,824 2,557,446 |
OSB 534,949 575,032 734,042 744,340 678,754 709,556 692,559 598,681 2,397,699 2,256,427 2,732,168 2,679,550 |
Lumber 715,773 720,134 828,620 835,550 702,796 688,886 673,238 605,678 2,543,536 2,955,789 3,087,100 2,670,598 |
Structural $/Unit Structural |
Plywood $/MSF 3/8” $ 320 $ 337 $ 337 $ 351 $ 361 $ 326 $ 319 $ 296 $ 296 $ 363 $ 346 $ 325 |
OSB $/MSF 3/8” $ 248 $ 322 $ 290 $ 264 $ 303 $ 280 $ 245 $ 191 $ 254 $ 329 $ 293 $ 257 |
Lumber $/MBF $ 446 $ 469 $ 460 $ 442 $ 440 $ 453 $ 438 $ 406 $ 366 $ 473 $ 453 $ 435 |
(1)Pro Forma(2)Includes LSV as of the acquisition date, July 2005 and Austin Hardwoods as of the acquisition date, August 2006.(3)Includes competitive discounts, cash discounts, service revenue, Canadian conversion, and sales accruals. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0034.gif)
BlueLinx Holdings Inc. Unit Volume Growth By QuarterUnit Volume Growth 2004 2005 2006 2003 2004 2005 TTM |
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Specialty(1) 2.9% 1.7% 0.5% 5.8% 12.7% 14.9% 9.6% (3.9%) 4.4% 7.6% 5.1% 8.0%Structural |
Plywood 9.7% (1.0%) (3.3%) (14.6%) (8.7%) (10.3%) (13.2%) (9.0%) (7.1%) 4.1% (6.7%) (10.5%) OSB 7.0% 12.4% 21.5% 24.5% 23.7% 21.7% (6.4%) (20.3%) (6.9%) (3.0%) 20.4% 2.5% Lumber 23.8% 7.2% 9.4% 2.6% (1.8%) (4.2%) (18.4%) (27.4%) 11.0% 17.6% 4.3% (13.6%) Rebar/Remesh 19.4% (7.1%) (4.2%) (5.0%) (6.1%) (8.1%) 8.0% 8.4% 5.2% 19.1% (5.4%) 0.9% Total 14.3% 4.2% 6.6% 0.9% 0.2% (0.8%) (11.3%) (17.0%) 1.0% 8.6% 3.2% (7.7%)Total 9.4% 3.3% 4.6% 2.6% 5.0% 5.0% (3.8%) (12.0%) 2.5% 8.2% 3.9% (1.9%) |
(1) Includes LSV as of the acquisition date, July 2005 and Austin Hardwoods as of the acquisition date, August 2006. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0035.gif)
BlueLinx Holdings Inc. Market Growth By QuarterMarket Growth 2004 2005 2006 2003 2004 2005 TTM |
Weight Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 End Use Driver |
Actual Housing Starts 50.0% (2.5%) 5.5% 6.7% 6.7% 3.0% 2.5% (9.5%) (18.7%) 8.4% 5.8% 5.6% (6.2%) Industrial Production 22.0% 4.2% 3.9% 3.4% 2.9% 2.7% 3.4% 3.7% 5.5% 0.6% 4.1% 3.2% 4.0% Repair & Remodel 15.0% 10.4% 1.8% (4.0%) (0.4%) 1.5% (3.5%) 12.1% (0.4%) (2.4%) 5.0% (0.4%) 2.6% Actual Mobile Homes 8.0% 9.5% 6.9% 0.0% (0.3%) 51.5% 8.4% 1.5% (9.3%) (22.5%) 0.0% 14.6% 10.7% Non Residential Const 5.0% (5.8%) (10.7%) (6.7%) (0.3%) 5.2% 8.2% 5.0% 4.4% (3.5%) (0.1%) (3.3%) 5.5%Total 100.0% 1.7% 3.9% 3.2% 3.9% 6.7% 2.6% (1.8%) (8.7%) 2.0% 4.5% 4.4% (0.7%) |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0036.gif)
BlueLinx Holdings Inc. Gross Margin by Quarter Gross Margin $ in millions 2004(1) 2005 2006 2003(1) 2004(1) 2005 TTM |
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Specialty(2) (3) $ 64.3 $ 63.2 $ 70.1 $ 74.2 $ 76.9 $ 80.4 $ 86.9 $ 77.5 $223.2 $279.6 $284.4 $321.7 |
Structural(3) 36.1 60.6 50.7 66.6 67.8 55.8 55.7 46.8 247.6 310.0 245.7 226.1 |
Other(4) 1.0 (4.5) (5.1) (3.8) (4.3) (6.2) (6.2) (3.4) (17.6) (25.8) (17.7) (20.1) |
Total$101.4 $119.3 $115.7 $137.0 $140.4 $130.0 $136.4 $120.9 $453.2 $563.8 $512.4 $527.7 |
Gross Margin %’s Specialty(2) (3) 13.6% 12.6% 12.9% 13.3% 14.3% 13.9% 14.4% 14.0% 13.2% 14.3% 13.3% 14.1%Structural(3) 4.8% 7.0% 5.3% 7.3% 8.3% 6.9% 7.0% 7.0% 9.4% 8.5% 6.9% 7.3%Other(4) n/a n/a n/a n/a n/a n/a &n bsp; n/a n/a n/a n/a n/a n/aTotal8.4% 8.8% 7.8% 9.4% 10.6% 9.4% 9.9% 10.0% 10.6% 10.1% 9.1% 10.0% |
(1)Pro Forma(2)Includes LSV as of the acquisition date, July 2005 and Austin Hardwoods as of the acquisition date, August 2006.(3)Includes product rebates.(4)Includes competitive discounts, cash discounts, Canadian conversion, and accruals. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0037.gif)
BlueLinx Holdings Inc. Income by Quarter Profit & Loss Statement $ in millions(4), except per share amounts 2004(1) 2005(2) 2006(3) 2003(1) 2004(1) 2005(2) TTM Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Sales $1,509.6 $1,207.6 $1,351.6 $1,487.0 $1,454.2 $1,329.3 $1,376.6 $1,379.0 $1,203.6 $4,271.8 $5,558.2 $5,622.1 $5,288.5 Cost of Goods Sold 1,367.3 1,106.2 1,232.3 1,371.3 1,317.2 1,188.9 1,246.6 1,242.6 1,082.7 3,818.6 4,994.4 5,109.7 4,760.8 Gross Profit 142.3 101.4 119.3 115.7 137.0 140.4 130.0 136.4 120.9 453.2 563.8 512.4 527.7 Gross Margin % 9.4% 8.4% 8.8% 7.8% 9.4% 10.6% 9.4% 9.9% 10.0% 10.6% 10.1% 9.1% 10.0% Operating Expenses SG&A 94.3 92.7 91.5 87.9 97.9 100.7 97.3 98.1 99.6 359.9 384.8 378.0 395.7 D&A 4.0 3.9 4.1 4.6 5.0 5.0 5.0 5.1 5.2 15.6 15.5 18.7 20.3 Total Operating Expenses 98.3 96.6 95.6 92.5 102.9 105.7 102.3 103.2 104.8 375.5 400.3 396.7 416.0 Operating Income 44.0 4.8 23.7 23.2 34.1 34.7 27.7 33.2 16.1 77.7 163.5 115.7 111.7 Interest Expense 9.9 9.9 9.3 10.7 11.2 11.1 11.2 12.3 12.0 31.9 37.7 42.3 46.6 Other Expense/(Income) 0.1 (0.5) 0.2 0.2 (0.3) 0.1 0.1 (0.1) — 0.4 — 0.2 0.1 Income before Tax 34.0 (4.6) 14.2 12.3 23.2 23.5 16.4 21.0 4.1 45.4 125.8 73.2 65.0 Tax Expense/(Benefit) 13.8 (1.9) 5.8 4.5 9.3 9.0 6.6 8.4 1.8 18.5 51.2 28.6 25.8 Income before Charges 20.2 (2.7) 8.4 7.8 13.9 14.5 9.8 12.6 2.3 26.9 74.6 44.6 39.2 Charges associated with mortgage — — — — — — — (3.0) — — — — (3.0) refinancing, net of tax Net Income $ 20.2 $ (2.7) $ 8.4 $ 7.8 $ 13.9 $ 14.5 $ 9.8 $ 9.6 $ 2.3 $ 26.9 $ 74.6 $ 44.6 $ 36.2 Diluted EPS before Charges $ 0.67 $ (0.09) $ 0.28 $ 0.25 $ 0.46 $ 0.48 $ 0.32 $ 0.41 $ 0.07 $ 0.89 $ 2.47 $ 1.46 $ 1.28 Charges associated with mortgage — — — — — — — (0.10) — — — — (0.10) refinancing, net of tax Diluted EPS $ 0.67 $ (0.09) $ 0.28 $ 0.25 $ 0.46 $ 0.48 $ 0.32 $ 0.31 $ 0.07 $ 0.89 $ 2.47 $ 1.46 $ 1.18(1)Pro Forma(2)Includes LSV as of the acquisition date, July 2005.(3)Includes Austin Hardwoods as of the acquisition date, August 2006.(4)Immaterial rounding adjustments and differences may exist between appendix slides, presentation slides, and previously issued presentations. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0038.gif)
BlueLinx Holdings Inc. Inventory by Quarter |
Inventory $ in millions |
2004 2005 2006 2003 2004 2005 2006 |
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Specialty(1) $248.8 $254.7 $238.4 $228.2 $245.5 $269.1 $299.6 $292.4 $181.3 $248.8 $245.5 $292.4 |
Structural225.7 234.1 217.7 168.1 184.6 194.7 192.5 158.1 150.4 225.7 184.6 158.1 |
Other(2) 25.7 29.1 30.0 22.6 43.0 37.4 40.1 20.7 (25.5) 25.7 43.0 20.7 |
Total$500.2 $517.9 $486.1 $418.9 $473.1 $501.2 $532.2 $471.2 $306.2 $500.2 $473.1 $471.2 |
Structural |
Plywood $ 59.9 $ 65.7 $ 55.6 $ 48.1 $ 54.1 $ 59.4 $ 53.8 $ 42.4 $ 48.1 $ 59.9 $ 54.1 $ 42.4 |
OSB 22.2 28.0 24.5 13.1 19.8 16.4 11.7 10.7 21.8 22.2 19.8 10.7 |
Lumber 98.9 102.5 100.2 82.4 88.1 84.1 85.7 67.6 62.5 98.9 88.1 67.6 |
Sub Total 181.0 196.2 180.3 143.6 162.0 159.9 151.2 120.7 132.4 181.0 162.0 120.7 |
Rebar/Remesh 44.7 37.9 37.4 24.5 22.6 34.8 41.3 37.4 18.0 44.7 22.6 37.4 |
Total $225.7 $234.1 $217.7 $168.1 $184.6 $194.7 $192.5 $158.1 $150.4 $225.7 $184.6 $158.1 |
On-hand turn days (average) |
All Products 47 49 42 40 42 47 50 53 43 41 43 53 |
(1)Includes LSV as of the acquisition date, July 2005 and Austin Hardwoods as of the acquisition date, August 2006.(2)Includes in-transit accruals, discounts, allowances, reserves, and other miscellaneous items. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0039.gif)
BlueLinx Holdings Inc. Quarterly Volume by Region$ millions (unaudited )Q3 Q3 Total $ $ Unit %Unit 2005 Sales 2006 Sales Variance Variance Variance Central 107.3 87.6 (19.7) (15.6) (14.5%) Western 330.4 269.2 (61.2) (45.2) (13.7%) Mid Atlantic 253.9 209.1 (44.8) (31.0) (12.2%) Northeast 173.5 147.2 (26.3) (21.8) (12.6%) Southeast 401.3 328.8 (72.5) (45.1) (11.2%) Mid West 177.4 142.5 (34.9) (26.0) (14.7%) Other 26.7 35.8 9.1 8.7 NA Total Invoiced Sales BlueLinx 1,470.5 1,220.2 (250.3) (176.0) (12.0%) Miscellaneous (16.3) (16.6) (0.3) Total Net Sales 1,454.2 1,203.6 (250.6) |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0040.gif)
BlueLinx Holdings Inc. Year to Date Volume by Region$ millions (unaudited )YTD YTD Total $ $ Unit %Unit 2005 Sales 2006 Sales Variance Variance Variance Central 326.0 281.4 (44.6) (34.3) (10.5%) Western 984.1 877.9 (106.2) (75.6) (7.7%) Mid Atlantic 756.8 688.6 (68.2) (37.8) (5.0%) Northeast 467.3 436.9 (30.4) (21.5) (4.6%) Southeast 1,216.6 1,152.8 (63.8) (4.6) (0.4%) Mid West 523.8 475.4 (48.4) (33.2) (6.3%) Other 61.5 102.6 41.1 41.5 NA Total Invoiced Sales BlueLinx 4,336.1 4,015.6 (320.5) (165.5) (3.8%) Miscellaneous (43.3) (56.5) (13.2) Total Net Sales 4,292.8 3,959.1 (333.7) |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0041.gif)
BlueLinx Holdings Inc. Gross Margin % Analysis 3Q06 Variance from Trend Trend (3) 4Q05 1Q06 2Q06 3Q06 F/(U) Structural Products(1) Warehouse 10.6% 12.0% 10.4% 9.5% 9.1% (1.5%) Direct 4.3% 5.1% 3.7% 4.6% 5.1% 0.8% Reload 6.7% 5.9% 4.7% 5.9% 5.3% (1.4%) Total 8.1% 8.3% 6.8% 7.0% 7.0% (1.1%) Specialty Products(1) Warehouse 16.3% 17.8% 17.9% 17.7% 16.9% 0.6% Direct 7.5% 8.2% 7.2% 8.4% 8.2% 0.7% Reload 8.7% 10.8% 9.9% 11.3% 10.0% 1.3% Total 13.3% 14.3% 13.9% 14.4% 14.0% 0.7% Total(1) (2) (3) 10.1% 10.6% 9.4% 9.9% 10.0% (0.1%)(1) Includes product rebates. (2) Includes competitive discounts, cash discounts, Canadian conversion, and accruals. (3) The 11 quarters from 2001 through Q3 2003 was selected as a representative trend period which reflects a variety of market conditions and pricing cycles. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0042.gif)
BlueLinx Holdings Inc. Revenue Channel Mix Analysis 3Q06 Variance from Trend Trend(1) 4Q05 1Q06 2Q06 3Q06 F/(U) Structural Products Warehouse 57.2% 45.1% 44.9% 44.6% 46.3% (10.9%) Direct 33.6% 40.7% 41.4% 39.3% 35.5% 1.9% Reload 9.2% 14.2% 13.7% 16.1% 18.2% 9.0% Total 100.0% 100.0% 100.0% 100.0% 100.0% 0.0% Specialty Products Warehouse 64.8% 60.4% 59.4% 61.9% 64.8% 0.0% Direct 29.2% 29.2% 30.1% 28.1% 25.8% (3.4%) Reload 6.0% 10.4% 10.5% 10.0% 9.4% 3.4%Total100.0% 100.0% 100.0% 100.0% 100.0% 0.0%(1) The 11 quarters from 2001 through Q3 2003 was selected as a representative trend period which reflects a variety of market conditions and pricing cycles. |
![](https://capedge.com/proxy/8-K/0000950144-06-010934/g04383g04383z0043.gif)
BlueLinx Holdings Inc. |
Structural Products Price Trends |
Plywood Price Trend 2003-2006 YTD Oriented Strand Board Price Trend 2003 - - 2006 YTD |
Southern Sheathing 15/32” 4 Ply. West Zone Oriented Strand Board 7/16” North Central Zone $550 $550 $500 $500 $450 $450 $400 $400 $350 $350 $300 $300 $250 $250 $200 $200 $150 $150 $100 $100 |
Lumber Price Trend 2003 — 2006 YTD |
Western SPF 2x4 #2 & Btr |
$600 |
$550 $500 $450 $400 $350 $300 $250 $200 $150 |
Source: Data from Random Lengths Publications, Inc., updated as of October 27, 200643 |
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BlueLinx Holdings Inc. Capital Structure Position |
Debt to Total Capital Ratio of 76% is manageable |
Low borrowing cost / Asset-based / Liquidity balanced |
Key Metrics YTD Accomplishments |
Debt as % of total capitalas of 9/30/0676%In June, reduced projected annual interest rate expense by approximately $1.6 million, or $0.05 per |
Revolver excess availabilityas of 9/30/06$303 mlnshare, after tax, and protected against possible increases in market interest rates by: |
Average interest rateYTD 9/30/067.5% |
Refinancing floating-rate mortgage at 6.4% fixed |
Interest expense — % of salesYTD 9/30/060.9%rate |
BXC Leverage — Current StatePaying down $125 million of outstanding line of credit |
All low-cost asset-based borrowing |
Entering into $150 million, 5-year interest rate Creates low WACC swap to convert floating rate LIBOR interest rates |
Liquidity balanced to working capital on a portion of current credit line to fixed rate of needs 5.4% |
BXC Priorities For Free Cash FlowIn January, negotiated amendment on revolver that |
Maintain consistent dividend reduced interest rate spreads over LIBOR by 50bp |
Invest in high-return growth Pay down debt |