BXC - Earnings call 4 2023 | BlueLinx Holdings Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the BlueLinx Holdings Fourth Quarter and Full Year 2023 Earnings Conference Call. [Operator Instructions] Today's call is being recorded.

We will begin with opening remarks and introductions. At this time, I would like to turn the conference over to your host, Investor Relations Officer, Tom Morabito. Please go ahead.

Tom Morabito

welcome Earnings BlueLinx Call. and Full Quarter operator, XXXX Year you, to Fourth the and Thank

Wamser, Officer. Joining Reddy, prepared Chief Andy our on remarks, President Chief me today's questions. and Executive call we will Officer; of the end At is take Shyam our today's Financial and

the section news in significantly may most and of and from detailed GAAP presentation our certain along XX-K with investors SEC financial measure along of Actual webcast and provide our presentation, were those the of includes to issued encourage appendix Our fourth differ filings. Today's be follow Today's uncertainties, slides statements. release business. presentation. close recent contains market quarter in yesterday for context closest various discussion believe and items evaluating information that results during the we including our available the are measures these Investors our described Reconciliations found full adjusted risks year helpful financial non-GAAP We forward-looking to bluelinxco.com. due Form after the in the statements website, webcast. to forward-looking on our risks our can you and the the with

Shyam. to over it turn I'll Now

Shyam Reddy

Thanks, Tom, morning, and good everyone.

the our and are when especially in in uncertainty building full rising macroeconomic fourth a product interest with We housing pleased year both demand impacted year and sector. quarter XXXX results, rates and

business. about accounted margins quarter margins solid we of Our Structural to and and specialty year, for net our XX% full continue sales in in which products, both products the remained our for the strong generate

new million repurchasing to returning shares share our repurchase During the under to capital commitment quarter, shareholders we authorization. demonstrated by $XXX our also

we shareholders, $XXX repurchases $XX returned our authorization. repurchase which For previous includes to year, the million share under million

customers us first and they so distributors, years. option the optimize distributor to of to the number reduce want the all our be cost need enable for their coming I vision mix to bring in lumber market the points U.S. stores, become Before remain technologically manage meantime, one-step X-step the more XXXX that's doing, us advanced get and the demands products there reduce we'll share to dealers right to our them. And results, accelerate to the beyond. our and our for and jump strategy into yards the deliver in This pro when building suppliers able cost few. In meet products growth ordering and just independent and in option to first committed retail of to times. we markets, products brand serve, our business to the that's and XXXX to our a become where suppliers home And our to to effectively to will name corporate most touch I in in

our on supported excellence. sales operational and focusing opportunistic X pursuing specialty developing be by X business, by core will business, greenfields, opportunistic M&A; and growth third, of which First, in all enablers: second, digital key strategic by categories; by

multifamily and resources work, and products, back that we relates M&A into and fund to and be to are also projects. the engineered a single of the sold back enable a key There substantial or end construction and mill distribution-friendly capital at first siding, business. categories necessary housing These to and with specialty front are categories of operating reinvested customers' rather business. cycle be remodeling partners durable profit, our we've can time, categories strategic flow As vendor it at higher outdoor and of aligned opportunistic greenfield core used allocating gross net sustainable product product various X drive the growing job for product extension of us matter. They or sales X-step prong, project the in business which just a the high-margin generates industrial that the wood, share than cash our also or living to points

experience, we our Given a with want X-step which our product value-added pull-through account are in These scale, and excellence. sales that perspective, enablers, total additional believe sales includes product services distribution-friendly fuel channel be to accounts national about growth by we have and offering. From levels support geographic products operational seasonal reach, continue with of that solution fluctuate and and to products, cost in strategy: structural also I selling that structure business, a excited flexible provide providing a margin committed complements maintain the product see structural depth, both while capabilities customers can specialty our our drive our base. levels and solid sales on efforts investing we our demand. based customer opportunity customers to growth traditional strategic multifamily our our national continued supports digital to customer growing builder organic specialty and and that and capabilities

a managing in XXXX of also other nearly resulting benefits despite of top solid margin market effectively are challenging EBITDA costs, conditions. We on X% our and wage adjusted inflation

manner in business suppliers customer and experience rapidly vision, scale United believe designed by most BlueLinx transform grow both a and efficient offer today. I will technology advanced which products to X-step make like at us and States, with more suppliers to providing few and customers. the a These enable technologically improvements choice are building effective to than becoming both an provider details. I to more back would us Now for the exceptional customers distributor the in of the our

warehouse capabilities and in improve Over of tools, and digital and advances and that our our functionality. we we designed expand analytical enhance are our our transformation upgrade transportation couple embarking a preliminary management capabilities, back some the past our journey architecting starts and of our enhancing Beginning e-commerce multiyear EDI infrastructure. capabilities that with and strategy, it XXXX, on have hardware supports office launching so better years, data taken our foundational some general technology, data steps to

and build is data expected management e-commerce which As of costs, routing, our will to a result, optimizing truckload cost product, our platform. an logistics, scalable customer supplier management reduce more EDI capabilities, be serve, supplier implementing and and master governance our we shipment piloting to and customer enhancing of and freight

believe also further initiatives. our enhance pricing these We procurement improvements operational, that sales, excellence existing and will digital

in to initial suppliers, a journey us Our both sales and execute our the costs, long-term will believe us increase and result for growth enabling of in provider to become these in operating our digital realizing and successfully CapEx, allowing customers on we an both profitable vision transformation on critical moment, OpEx will our which investments Andy are choice strategy. thereby expand reducing to

growth third and reflect M&A opportunistic second of our in to greenfields. commitment strategy our The prongs

to our strategically are best and acquisition only valuations expand support We targeting specialty our in growth We sense designed our that product measured are to make that nature are remain for of at and opportunities that committed the the geographic strategy. our and us opportunistic that interest stockholders, support strategy companies buying reach approach. hence, our sales of

front, we that greenfield opportunities several development. great the potentially identified market for markets are new have On

to allow gives the remains at $XXX liquidity us cash Our of position reinvest of and better our in important initiatives transformation. sales, financial to service, reach that course, including and return This an of the capital remains repurchase which by strong business hand. to our million as on be shareholders ability our million with of example the vendor to grow having year flexibility would demonstrated customer provide improve us share expand very strength of geographic the And record productivity, digital a program. $XXX end

few Next, XXXX. a I'd like from highlights to offer

light of particularly delivered in solid results, year the XXXX full we First, environment. macro challenging

the slowed activity you recession As during and of making know, and starts environment higher interest year, the risk repair rate business very and difficult. rates housing the lingering remodel

confidence and teams resulting have effectively BlueLinx to in in our our strong performance. combined our in us compete with helped However, supplier our financial customers partners the markets,

Second, XXXX also were our fourth quarter solid. results

market declined the As year-over-year given expected, of our deflation. price largely revenues impact

came However, XX.X% and our at gross our highlights margins Structural manage margins which despite to picture. macro XX.X% respectively, team's Specialty ability the successfully and in

continue XX% full the approximately of which to and fourth for our XXXX. expanding accounted gross sales profit both focus business, products on year Third, and quarter of specialty for XX% net we

completed. X% back nearly for million the prior program Of a For product of our of after of announced was outstanding announced $XX Overall, geographic the $XX in to continue partnerships capital woods. partnerships our to example, engineered capital quarter, demonstrating fourth the products share we on worth in Both focus during quarter, $X we nearly shareholders. shares our on million we of specialty XXXX. we specialty reach execute XXXX, broaden we distribution new shares under allocation million authorization includes strategy, Pacific expanded [indiscernible] disciplined growth. Fourth, with QX. repurchases returning in bought share new our offerings, authorization Louisiana $XXX repurchased the will which repurchase million million Last the $XXX

repurchases admittedly Given anticipated. our amount less than performance, recent price were the strong of QX originally share in

However, to financial be prudently manage and continues to very we significant the little will liquidity with continue strong position our in leverage. market. Fifth, net opportunistic be as the business we

well on with capital growth us successfully return vision while the our positioned corporate all are the execute to in to to We to business, realize and invest to providing our strategy, flexibility shareholders.

generated for a a income net billion our $XX.XX adjusted $XXX sales more year million net for was EBITDA results. $X.X margin. per We of X.X% million EBITDA few and full XXXX details or $XXX Now on in Adjusted adjusted share.

at XX.X% margin gross products and we coming year, XX.X%. performance solid structural products delivered at the For specialty in with

operational led and effective opportunities to levels, and results. contributing strong business Our procurement to focus pricing, excellence cost strong these on service management,

by on reduction generated significant the In XXXX, coming inventory our operating our with of category. cash over specialty capital we all products In the continued focus nearly reduced $XXX million addition, flow. has in working improvements from

the We flow of also generated million during cash $XXX free year.

perspective Now and market. broader on products the our turning building housing to

the the November do in December. improved revised months, housing sense saw starts in headwinds overall and recent sentiment has industry optimism are during suggesting of sources industry and Our for market, remain. meaningful Builder a improvements

those would as addition, way the are of otherwise is of elevated. in and are of out mortgage for home and the elevated affordability especially rates activity issue peak remains decline are In are sales expected still X%. low high. Repair are and a remodel are XXXX. still year, rate XX% the and levels said, existing markets past an years Overall, first-time around now the X%. while under lower to cuts from into that That remodel prices last they than X to home. home anticipating in housing way under remain on X% further the And repair many of XX% for the consumers, drive X% mortgages mortgages potential to continues due down on buyers financial spending the XXXX be and

QX with repair XXXX, QX and we X of However, albeit have home ones. Through smaller products, owners weeks generally solid in Structural remain allowing line first for remodel and projects, refund maintained levels XXXX. Specialty high, do to equity margins the

the are volumes by daily experienced down in to our during saw compared recent have expectations However, January been we impacted and weather extreme quarter. the what patterns into

half fact, us. find The between building due ground In markets unusually and January locations needed X had time our winter that and customers activity normal to to for business took in to closed commence the X days nearly flow through cold also of we storms. and weather and to our turn, as an for ramp-up many sales in

recent volumes Specialty X most improved. have the During Structural and weeks,

this of In creates though hope adverse an gross note specialty XXXX. are progresses. headwind impact and that This dollars impact as profit see Even deflation cost our stable, we have are addition, margins a and on important year goods is to near-term it both continues the price to products industry-driven lower. improve topline to during

delivered market in we sector, housing which of underlines outlook the clearly shortage respects, long-term the The unpredictable, and supportive should industry shifts, repair high summary, believe like allocation my their remodel performance driven home prospects stock, Although thanking the housing initiatives. I'd both and and tough our difficult our homes, end our and focus. as specialty comps. improving industry to strategic demographic product by BlueLinx. In for also continue efforts, housing many remains strategic our delivering solid full in capital attitude year to year-over-year their to the and last for XXXX the building continued is on perseverance customers and by suppliers. We're generation priorities and cash dedication fellow BlueLinx our the aging fourth of of and building near-term quarter challenging seen the environment we pricing and associates by housing activity investment results selfless products discipline, strong margin equity and cost and can-do expansion and for during benefit year's for and necessary despite levels our products

can of on realize advanced Our committed structural growth, our ability market specialty in are that growth face. solid generating teams position confidence X-step corporate in in sales technologically to whatever and becoming conditions the product we grid product returns gives ensure producing to That our profitable for the we executing most ourselves strategy, while products working our and tremendous U.S. success X-pronged distributor vision and of more capital on specialty greenfields. me to sales M&A building long-term

We the to strategy accelerate values have infrastructure, capital culture and investments the succeed and the people, step make purpose and prospects our to the of working us, our each equipment inspire along way. digital takes our effect to us breakneck for us, guide to intestinal as technology, to fortitude with transformation in position corporate and growth the delivers the

who and structure. it will financial our to capital over turn more results I'll Andy, Now our provide on details

R. Wamser

Thanks, Shyam, good morning, everyone. and

structural products strong gross legacy Specialty expenses. variable to mentioned margin volumes. delivered diluted deflation benefit were share from down XX% both in gross were XX% and Overall, terminate $XXX period product delivery $XX quarter. $X.XX. by and we've loss a Let's the a the sales categories. prices prior loss first Net and XX.X%, million, filings, combination wood-based due commodity declines $XX the plan. margins XX% compensation we down down lower solid prior also significant pension results, down go sales and was year-over-year previous due in year million In and lower plan fourth due the million down and in through the volumes. quarter decrease from to was to XXX a from specialty year-over-year. for basis profit year prior Total were million, highlighted Structural of product was our sales period. SG&A that $XXX highlights consolidated X% we per points Net was was defined to

During a million million. an highly December, the financial $XX.X under responsibility and a we cash rated insurance made onetime a of plan company contract. for to payment We incurred transferred all charge final $X.X annuity of remaining

was us to a was adjusted no as loss result $X.XX million quarter provided net effective pleased diluted this Due and not plan, of benefit behind rate pension expense to was a share. to Adjusted active legacy manage. complex obligation are our $XX.X our $XX the EPS income have which in Tax million. settlement, We it for net most pension a calculation. was our quarter and tax was for fourth employees of the the per as meaningful was

XX% tax For of the first $XX quarter the in patterns. Adjusted million rate or seasonal of XXXX, normal we range. to EBITDA was net be anticipate to XX% our X.X% sales, following our

EBITDA and a have lower As adjusted in but the the of quarters, to reminder, in we quarters and fourth second the third higher first year. tend relatively margins margins

Gross X several results decline $XX gross to This categories. was down XX.X%, now Specialty $XXX strong specialty million, XX% driven Net weeks down with products. Through largely a January specialty points was range the product XXX the sales down fourth first to given XX% year-over-year. X% price quarter were of margin the in XXXX Turning fourth specialty but was quarter XX% XX% of the of daily sales product year-over-year. year. deflation gross margin across sales profit impact margin, was weather. XXXX, by products volumes the of to from basis for last down million, compared from specialty

basis. Over specialty however, about X past flat volumes on year-over-year weeks, a the were

and time we progress We expect we less about year. versus a are, the down be headwind as of XX% pricing to year, average this however, last seeing specialty this throughout

per million, and year. In decrease profit by respectively. the XXXX. respectively, $XX Now of framing comparing third primarily and XXXX, price XX% quarter decrease the basis from XX% compared higher the volumes. and partially Net a were products fourth average down structural was was $XXX per was increase, structural XX.X%, Sequentially, square prices board deflation were from compared panel quarter up year prices fourth last structural due sales to the to X%, of fourth year-over-year XX% gross within to moving lumber, million, and slightly Gross in about lumber of margin period about the XX% XX the were XXXX, prior of decrease XX% these period. offset feet $XXX to points on and were a products. $XXX averages quarters down This thousand prices thousand feet, same

early the while feet, QX During the in during declined rebounded prices finished per the now thousand prices and last respectively. quarter, of board X week the XXXX further $XXX December, are fourth $XXX These increased and weeks thousand December declined but $XXX respectively. and prices have lumber feet they at square panel first quarter of in per and $XXX

volatility and XX% does first gross to manage to levels continues margin XXXX, the the the was of to pricing volume X cost to impact low. Through XXXX risk weeks. purchasing XX%, keep team QX some excellent down of there to past job of January consignment and in centralized reflect improvement inventory X structural to sales mainly margin range with through structural has strong weeks Similar commodity in the in Our daily quarter product of compared been lumber over leveraging structural utilizing specialty, our weather. the volumes given the fourth

inflationary For had $X.X net when in the XXXX. Specialty difficult XX% to XX% environment the XXXX XXXX. and in the prior product contrast sales down comparisons structural results year, and sales were XX% respectively down SG&A deflation versus of billion, experienced from from and points year from very period. due basis was the prior gross million, year profit X% prior $XXX margin was Total to XXX down lower period. and $XXX a was volumes. gross down the combination XX.X%, million were year

million our as growth slightly million, our a to of the as tax Shyam and due technology $XX share. full in was rate to by termination. Adjusted plan pension levels once increase again was was net initiatives. Net SG&A expect investments adjusted and impacted we percentage $XX.XX well per XXXX, was sales income The diluted share. EPS For mentioned year EPS as XX.X%, was $XXX that $X.XX diluted income the per

For in our was we full the tax to XX% rate anticipate Adjusted be net EBITDA $XXX million or year sales. XXXX, XX% of X.X% range. to

balance at now Looking our sheet.

including effective initiatives excellent a an cash hand $XXX strong million to remains year, of strategic $XX from also due on considering the million million, million, hand of the undrawn cash million. capital. the and liquidity management level $XXX the available was of of debt record. Total a our record At debt, on revolver QX. net $XXX was year, leases liquidity our reached million end financing $XXX $XX When the Our was of at working and increase capacity of and execution end our of

is X.Xx and no Our outstanding net leverage have material maturities now we XXXX. until debt

For agreement, which our leases, the financing property credit real a net terms of was X.Xx. not leverage ratio negative does our include

organic Our balance our combined sheet EBITDA initiatives. is cash generation, are our and These in and inorganic strategic solid our investments to great return growth such highest we with as when repurchases. share and well positioned opportunities, support shape initiatives strong and include in

free Now working flow. on and capital to moving cash

cash During of million. million quarter, of $XX cash the flow fourth we flow and generated operating $XX free

XXXX, of For operating cash year million $XXX generated million. we flow of flow the free $XXX full and cash

generation from cash beginning more the of supported than was primarily earnings of year capital XXXX. by the inventory full Our from net reduction and of to million a related $XXX working benefit

allocation. capital to now Turning

facilities our in approximately During million CapEx, the our fleet. quarter, we and primarily to upgrade distribution spent $X improve

year, the $XX was CapEx about For million.

$XX and fleet focusing technology previously capital further million, discussed. to to to For increase upgrades improvements, we around facility the XXXX, on our investments expect improvements

$X as least operating associated have initiative. also this at Our on headcount implementation million software digital expenses license as impact to increased XXXX with transformation related well in a will

opportunistic we $XX transactions and our of to approximately fourth quarter, million During stock market open we our through to common company's the in under plan continue market. be the programs repurchase purchased

sheet, return M&A to We to for to and principles as consistent. shareholders. through remain guiding pursue us geographic balance strong strategy well capital intend disciplined maintain in Our expansion invest which a business economic cycles, our enables allocation a as capital

the to Xx highlighted by flows, our with difficult housing when long-term are net results, margins or considering and Overall, less. We full we also year especially pleased free market. a our of plan target fourth leverage and quarter strong maintain cash

on sheet take strategy shareholders. Operator, are our our Our strong ready we returns provide to positions balance and us execute to for questions. now well

Operator

Instructions] from Craig-Hallum the [Operator come Capital question Our first of will Group. Palm line with Greg

Greg Palm

a at feel little know I Is metrics, specifically to you maybe you price to color and I'm year on a quantify not at still start a And maybe can gave you headwind 'XX. I of think that that with this sort in it bit there I more QX. volume. wanted of headwind for sort year persisting it's this the point of if of was lot sure of what still price point? was of sort terms full is kind in Or hard normalizes? like time a where wondering

R. Wamser

I'll was Andy. typically Greg, that bit see bit. I'd that. a XX%, -- I'd in as maybe little we're QX It's it's -- little in the decrease. it's at stab for QX getting still as it's specialty, specialty pricing, What about was XX%, than for QX. the -- look my take headwinds mentioned the QX, I higher in of particular, is seeing And the about a we in it comments, higher mid-teens. was in and improving in it first order high the When XX%, maybe then say year, -- the we say the of at pricing in magnitude it in

that throughout would year, move we improve. we the to As expect

to of the lapping we're so of is we And pricing. end exact go think the the in But terms year, QX we the of by a should specialty what the from guidance give of be year. going exact end we the cadence not to lot

Greg Palm

Got it.

or point of out talk a And maybe end as way you improves this could efficiencies, and operations, SG&A about investments, shift in you think I that. is to there on that about referring sort you And as Is increase hope year-over-year or was customer on bit think little I some basis enables and Okay. it increase million you the talked any specifically, saw you of an well internal were $X maybe gain gears the this initiative QX? the the curious digital That's that helpful. investments also of it well. helps that if if and but then the you the behind that levels specifically based a share? on said And I

Shyam Reddy

you. hear Greg, from to great

the aspect. that into the of dive I'll Let SG&A to part and me take first it to turn question, over Andy

first of is, distribution absolutely So in customer costs space -- to when reducing all, of most our answer on And improving the they products. embarking to -- your provide for question provide product. in will we're XXXX, our yes, building while the is the and this, first transportation, supplier Ultimately, goal experience. the need X-step context best delivering both the the which includes the costs as to customer phase customer the also logistics relates to the where which operating and primary the experience reduce to in of end the it

today, any So lumber manner. And event, the in we the but multifamily could a with which in yard, -- to a well customer cost-effective or and or platform. enhancement do secondly, it site actual we're more be the forward direct job home it actually as on be customer delivery, piece e-commerce efficient center but could the moving

with and multiple the between for customer it good is ability plan few pilot order launch the us, with Our them a in feel have and ultimately the our be so few a from And that on inventory, it, branches. about built to once points a a enterprise. out across start and scale entire to months to idea branches coming so better and of would dedicated and reduce And customers program locations number give touch the said forth. into as I visibility earlier, multiple the we've

to idea outstanding the ultimately, customer or experience. exceptional is an So provide

R. Wamser

Andy. is This

some to color give it As that. SG&A, relates you let me on

QX we've QX, some healthcare as burden true-ups onetime actual thought to terms rate. related in did our about comp. related of have some workers' true-ups had We -- like So benefits to

so SG&A with and in about we rate, But what that, through in OpEx investments. being $X about And always SG&A saw that That million very degree the in that act to But terms we the run the the the adding that this then as we on and QX comments the about of sort -- of have will plan in of it's we see the taking to I mentioned the think assumptions I QX QX. for this SG&A line the my have on we leverage. when focused think investments. said, in will addition for run those in we terms through related technology to XXXX market rate in I are technology we QX think right year, deteriorate, are more in

Operator

next the with line Jeffrey Capital. Loop Stevenson Your from comes question of

Jeffrey Stevenson

quarter. Congrats nice a on

months or down if of perspective? make first sales wanted here the volumes And weather a over to so? in weeks historical you the weather ask I you year adverse concentration as the due sales So believe coming March do about from the can daily being the up XX% for slow quarter cooperates of start over January. large to the first year X of How a

Shyam Reddy

from to Thanks, Jeff. Good hear you.

as over improvement look, we've that's there is flowing weeks, So it P&L. the and that the seen progresses last quarter the few through

from has kick into to the faced we in in obviously, can't seasonality give challenging the opportunities But specifics, a season. things we move to and with headwinds number started, improve to us I do head as we to March positive expect January. the -- we aspects seasonality the standpoint. the As normalize the you provide on and continue and season, expect trend we into

R. Wamser

that just just due up to a January. will be volume difficult that make to would it the was us maybe color. is of little What for some in Yes, say weather I additional

more specialty, bit we in As that the that improvement say, an was a there previous is the been, has year-over-year. I'd though, mentioned last down line little with X The in structural still year. weeks, in

difficult go making and some up make to bit a to little still volume. in of So I structural terms has then that of up think

Jeffrey Stevenson

any And about we what ticket hearing housing makes hearing and signs been inflection and R&R demand of more in cost the as channel positive R&R high could just right I demand trends you've suppliers has that And No, to here? lack due Because you now talk and it. large credit Got sense. into XXXX if partners? you're of wondered been from if move turnover. potential challenged of wonder your

Shyam Reddy

suppliers say from matter on our and we're our hearing customers would with that that what I the for front. hearing No. publicly R&R what directly we're is all consistent

R. Wamser

Yes.

R&R, at think mid-single terms going look in sort I of generally you look to of down it's when you consensus et of digits numbers be if cetera. [indiscernible] sort just

view think as we I right theme now. Hopefully, the move the right but year, things the that's that's So general go general improve throughout now.

Jeffrey Stevenson

Got Okay. it. And last one one.

with the partnership wondered several in impact partnership growth several I additional just could opportunity organic months. And had over forward. last discuss if announcements suppliers potential the moving and midterm Shyam, leading supplier for on expansion its You've expansion the we

Shyam Reddy

Sure. Yes.

which, markets, located got why where all home we're the in great centers. of or already product us the which some distributors allowing national multiple that with there, I our really, basically, are fact suppliers much ability whether offerings a reach would key good So to be to expand alternatively be we've regions to really feel for is geographic otherwise provide get result be they're our might to of accounts partnerships suppliers they opportunities that too yet including are or number detail. But them, be us their can't working hence, to the collaborative who located have expand got of in the conversations reach, gives the that we're public, our solution that a made with strategic the we've expand else where not for new them into with are of scalable customers, a like in I someone one-step geographic our displacement group looking again, of

Operator

Reuben the from Garner with Company. of comes question next the Your line Benchmark

Reuben Garner

guys hearing to hearing you're smaller maybe what little year bit little know I this the the might be gotten recent builders. a for their we've with of the what curious bit from I was a more of you earnings we're builders kind repeat have bigger exposure what in that weeks this outlook versus rate season.

Shyam Reddy

January, which builder caused lower expected. really are that did in up, consistent fiercely starts and their we're Yes. what I the a lot weather say hit would then mean marketplace. the housing be in hearing to than I dramatically generally views again, sentiment with tick

little a miss. it's hit or So

we a when I speaking, we'll the have see think, truly an January. But Builder regional who inclement to more custom homes read International building much opportunity as where next term. the better the consistently talk actually weather how past. be post across in But Show, no is are quite is may feel are half everyone, not the builders be tempered to, not in get very smaller rate have sensitive, in week people that same as matter at their the as at we'll better. viewed we're sentiment good frankly, time, generally folks feeling where But near the they will second who the board, much it good,

Reuben Garner

the a that that clarification you all decking of sort of the then Or pressure on wood majority anywhere you're participate? of pricing in that Is siding, specialty pressure the or seeing pricing engineered of vast some And products else piece Okay. it? seeing. like the in are products other you

R. Wamser

think we siding deflation, materials well. industrial really outdoor when say seeing and in as would in and I pressure question. some we but it's in Great predominantly with specialty Yes. the millwork, Sure. are -- EWP pricing

but it's So EWP predominantly, and -- it's millwork.

Reuben Garner

here? Okay. last sort how know And for investment or referenced now. transformation success or of you I term, longer $X The track technology you guys a effort, mentioned one then me. million will And digital

what using return benefits metrics of look the that like? kind kind to you is And Over number coming are the of what the gauge few program? of years,

Shyam Reddy

Yes.

work now. doing where to that on well. those to sure example, rated, pricing straightforward respect in we're opportunities making optimization as, freight, logistics-oriented terms very identify for such able we're the getting improvements with It's TMS-related route you have as of better So logistics the our

reduce us over specific allow years next few have generate the the cost will very metrics are serve. there to savings that we and so our And to

pretty that's So straightforward.

Ultimately, As much is it the the relates do us we the e-commerce, of can to customer idea to customer given be get anyone else. with that wallet by can pick volume value opposed making it greater to from business of measured all easier up how and is about obviously, share the in that the point where experience. as context to grab to we any incremental will

do lot transactional ultimately and goal. the is makes with to is top that then us us. notch, the run volume it it for so business easier experience folks And through more customer And a

have and over TLE track will we measures around that's a so we'll enhancement, And it how time. mix number of growth, shift, margin

R. Wamser

just OpEx at million then, 'XX, investments the When in $X one And talk there's clarification. technology Reuben, of for million we least at point $X about least and then in CapEx.

system, related the the would to the or to in transportation 'XX as than TMS little think that the management really say, we frame time we pay million. the -- expect the have of IRR to more I bit And off, that So 'XX a spend actually. would about a start beginning will be strong benefits $XX what 'XX,

Reuben Garner

that Great. transacted And be Any time? period your targets helpful. That's a on One of business via very today? are of could certain e-commerce over where there quick clarification.

Shyam Reddy

No. any done teams. e-commerce doing is sales it's done, our not Everything We're directly today. with via

Operator

with the D.A. Our from of Davidson. final question Kurt will come line Yinger

Kurt Yinger

of business, follow is actually Just Or ordering through that? on you question. within would dealers, e-commerce Is there that? up wanted last kind to business angle the that customers a to primarily that center direct-to-consumer home envision

Shyam Reddy

Yes.

and in by home us. their done fulfilled asked, e-commerce national actually portals last let just that give orders -- the of there that special the way, programs, question that their or response We through platforms centers point clarification. processed get of a do on by accounts our other the order their to through Jeff get end So me are and via

e-commerce itself, into in. relates that order some e-commerce foray BlueLinx developing would iteration it be to participate of is So through But platform any this for our there as to us. customer we

business to business. would idea the context, it's that in be So

mean, orders order we plans, -- for extent we end those business would aren't because become about to part don't able in any solution, current the thought be And there through user primary -- customers. We an I primary us. flow our care haven't mean, about that of our our to to the does I through plans still customers

the primary very benefit our that then the would exploring in of an it be market. opportunity for order to would to we're the then fulfilled through -- the order customers the customers pilot the our for and be to platform e-commerce efficiently extent, gets it by gets So order their branch of has one customer. But now, right

Kurt Yinger

Right.

I makes talked we've And right assessing you you down think And heard sense, of to in to or do in on the continue be then Okay. to of than in lot sites factors with these facilities guess some customers. get think the a greenfields important what appetite past. That guess, that curious, are I'm more greenfield kind to the your that a about successful? purchase least maybe to the for And how at I about, break of XXXX, should location ramp up? we most

Shyam Reddy

Yes.

approach an measured So is be our of the to That It's important there. strategy. right we're appetite and right the it the make doing sure we're very our going in said, market. thoughtful part way to in

think the at gray for if it's we there's west whether drives through sale XX either of sales long reloads. from do service makes a about a MSAs where you a have look direct Southwest, certain are presence through don't As there that of space or or all states alternatively That So Denver, we number markets, said, out west, facilities the we the sense us right? of in. lot the West,

cost as looks service very as starts, you some these one ways why and focused of single-family do there effective activity about housing another, all like. opportunity repair we but we over just the -- location what XX we the MSAs. we're might states, greenfield do in as in and housing efficient think well more on are obviously And starts remodel that So to and

have And then and with market well are that we millwork, to we strong both the business. on the carry, products take X-step not and respect friendly, label we complemented set And as and whether products at based an very or we private then particular make products, decisions example, as incredibly for distribution of strong in which a a then at structural EWP look is by the opportunity. same time,

we probably So and than the others a between we to like same over time, maybe. very ramp the ability we just the X, greenfield being progress feel have up where thoughtful so start how again, we about time. And more at

Kurt Yinger

with geography, of an new to servicing is for not existing go a location you servicing you're need given you it, maybe that And already, that a when where situation a displace a if I Or discussion type would of partners required part? most your that's a even guess, with is the expansion? lot already from where it that competitor you're vendor there whole to further evaluating vendor in

Shyam Reddy

to your that works, absolutely the specific No, way typically there it -- would vendor part partner our relationships be vendor tied markets. are because discussion

they're markets and every starts, instance, going to most others, in own is, our if start -- so a strong be and in distribution market, the with. housing X-step fact, friendly unlike business good private likely, we And at, will structural and label looking thing can brands for be competitors there. we're there have actually The we most that have strong

actually about very said who greenfield couple our time. excited they strong would would opportunities. where conversations supporting partnerships already gate we a they of believe supportive, with if than be over not suppliers then existing with I've And very be the out had have a few

can become our we private the with time, as very even that those will But business. projects conversations excited So the as ripen, take our fact I'm start further if brands more well those as opportunities serious. label they structural about

Kurt Yinger

it. Got

important from it is what valuation more back at Okay. levels? good Yes, how an That's about then little appetite stacks of hear. these and also the you're your to Can lastly, leave buying you up part aggressive seeing against And a to M&A strategy. there. I'll talk stock I perspective mean be perhaps just your a that bit

Shyam Reddy

Sure.

But with comment me So of level, to the capital core as capital clearly M&A it and allocation very our are capital seriously being I'll take Andy of to the in returning high it allocation. elements take then approach at strategy. a let the we that on one disciplined relates let part, and shareholders

space. efficient As the believe which is repeat is a good, developing in outlook That X-step it the are has of why it's relates roll-up strategy, still and of dynamics given a distribution to the part of way pursuing said, strategy markets. that we new to our we it's very growth M&A,

steady keeping slow X product primary been on historically to on the has and ultimately March geography targeting M&A continue eye the of drivers. and slow an specialty will our the disciplined and businesses So mix as we're and be of types and and acquiring

XXXX you numbers spreads in, expect, might the compress. the to bid-ask as continuing with Now are

So based on bring will, conformity and valuation rationale be logic I sense EBITDA, a should which XXXX from the standpoint, a of to valuations. multiple think, back

buy opportunistic again, over and sense realistic of again, compromising our time for strategy. We're it an our desire at opportunities our part to more business. without remains starting be see that companies So level be -- makes important to a without

R. Wamser

think, left the additional authorization as fourth think M&A. I then, plan that terms we'd I quarter, in of current don't on did both. in We total, it's total plan the have about be relates the repurchases an we we I QX. $XX the think think to $XXX repurchase I or $XXX And In for we repurchase, million either/or $XX situation, it little we either/or that and share balance in opportunity sheet going plan in and the to million an do don't is, where we're than be current new the it's given did share was a on Kurt, more to that opportunistic share million million the new But opportunistic. have said

Operator

back I'll that, With Tom hand any remarks. closing to the for call Morabito

Tom Morabito

joining first us forward look for to we speaking quarter in again you as Thank you results. with share Regina. and XXXX May today, Thanks, we our

Operator

you our Thank now that you and concludes for call today. joining all for And may disconnect.

BlueLinx (BXC) 21 Feb 242023 Q4 Earnings call transcript