BCC - Earnings call transcript Q2 2018

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Operator

Good morning. My name is Katherine and I will be are conference facilitator today. At this time I would like to welcome everyone to Boise Cascade's second-quarter 2018 conference call. [Operator Instructions].

Before we begin I'll remind you that this call may contain forward-looking statements about the Company's future business prospects and anticipated financial performance. guarantees to performance update not undertakes the are duty no them. statements of and future Company These

Although these uncertainties. statements implied subject differ to reflect from in management's expectation number materially business today, this of call. risks expressed and those Actual may a results or they are

to For of It to recent Cascade's filings your that the SEC. the Rancourt, may to pleasure actual results Wayne Boise a from refer the President, conference. Mr. you Treasurer to now Vice discussion is introduce my Boise differ of begin results Rancourt factors CFO cause anticipated, Executive please with may you and Cascade.

Wayne Rancourt

you, XXXX Thank welcome second-quarter earnings to call like and everyone. Good Katherine. business I'd Cascade's you to Boise update. morning,

our Wood our of me Dan CEO; Joining Distribution Tom Hutchinson, Products Head of and on our Nick Building Stokes, Materials operations. today's call Corrick, operations; Head are

point slide GAAP statements. reconciliations appendix X, includes I to EBITDA Turning adjusted the to would forward-looking our information The income and our regarding from out net EBITDA.

to like over turn call I'd Now Corrick. to Tom the

Tom Corrick

everyone. Good am I for us earnings our Wayne. for joining Thank today. Thanks, slide call X. on you morning,

second-quarter $X.X sales up were from quarter Our XXXX. billion second XX% of

settlement ago per for million Our $XX.X was million the or charges. per share net second $X.XX or from Reported up net pension substantially losses from $X.XX year non-cash quarter XXXX income $X quarter. income share, includes after-tax of

second quarter, improved Wood compared pricing the double elevated manufacturing reported in sales Products and $XX.X than business in segment second more last Products plywood year's much from Wood the $XX.X of on benefited Our quarter. quarter. to segment realizations million income the ago year income EWP of million

and quarterly with on walk then to capital I actions executed advantage we financial second of more will through taking volumes and pricing. an reported and results by EWP we million are of describe business provide outlook take the commodity tailwinds billion. BMD well to will the Distribution our in Materials back questions. come $X.X of $XX.X outstanding general growing segment quarter before quarter taking sales line allocation Wayne income in and Building Our detail and your on

Wayne Rancourt

am slide in the including quarter from distribution $XXX.X sales Tom. segment, million, second XXXX. X. on Wood XX% up were you, our to second Thank I sales quarter, Products

and Wood XX% costs segment stock for of and XX% sales due net negative settlement pension quarter The of and of from year the reported EBITDA increase from higher adjusted items million expense in compares for EBITDA was XXXX. The higher EBITDA As $X second XXXX release. the Tom XXXX. mentioned, million, and driven income primarily EBITDA or and other can plywood by pretax to impacting $XX.X of the non-cash of well log resulting profit $XX.X basis. The operating by in charges quarter million earnings million. was EBITDA negatively in gross $XX ago impacted with year income million up OSB quarter second X% positive found reported tables corporate on second to be million million our up XX% in billion, million offset in $XX.X reported business million EBITDA second Products income BMD $XX.X the EWP Sales respectively. Northwest Reported was the of higher the quarter. Pacific of prior higher higher for was negative in sales in prices in The the sales and costs The items a leverage. million $XX.X from QX income segment web of sales $XX.X the in improvement This $XX.X volumes by the those prices in were our partially costs. segment compared of quarter BMD $XX.X $X.X dollars unallocated quarter. quarter. as as EBITDA amount increased

Turning second XX% were to was in compared quarter. XXXX. up I-joists and X% the from the volumes Pricing LVL X% and with X, XX% ago respectively I-joists our LVL slide quarter up and year second-quarter for second and sales quarter for

to sales realizations of the improvement net as expect rest in continued we see EWP through We year. move this

slide to second-quarter in Chester, of Wood sales lost plywood volume million of boiler XXX a Turning in South our a at feet, result We XX as second quarter days failure. our mill Products flat with fan Carolina X, production was XXXX. June

Chester plywood risk $X.X reported the at financial operated part of to retention. The disruption of us of self-insured average during and and Corporate well was our plywood The impact With in quarter advantage plywood Chester our the most take $XXX price of net approximately exception million, allowing prices. the mills of Other was sales outage second strong in the to veneer composite far unusually which the quarter quarter and for slide averages. and third XXXX historical continued plywood in On was was XXXX, early panel quarter. random XX% has pricing in weaken from have Plywood second thus in XXXX. in chart XXXX. a the began and up decline the showing to second above well lengths pricing quarter OSB we June X as

number bigger June. declines impact XXXX, key and experienced panel earnings a the businesses. this imports pricing continue industry first year. meaningful of half moderate imports structural is year not for supply/demand and of the a become regions have are did in the Obviously to Brazil We as online driver to but from balance come Changes lumber in capacity the both transportation our plywood experienced new the of to revenue constraints since continues pricing in of in volume has plywood in expect a factor OSB addressed. similar a the half may later of on Dimension first

second during points XX% basis BMD XX The line in second products and the cash, XX%, percentage second quarter A quarter. decreased to these year slide reduction rebates $XX.X working slide reported Growth Moving EWP the sales. in inventory net increase were reported Accounts related capital by accrued On our the XXXX. billion, BMD's now increased The quarter. more out and products working first accounts XXXX. cash. second the product with from accounts quarter customer tax we general those receivables X.X% are million sales XX% to up set commodity margin inventory items as the XX.X in second-quarter has X, Exhibit of interest interested We the and in liabilities portion for XX%. $XXX our BMD I'm accrued $X.X and in slide up receivable, X-K income have was increased will out increased second in XX. Company working liabilities that payable and accrued ago information to statistical net of XX.X% elements the of area on was drove for capital. all excluding increased payable from detail. broken quarter XX%, down gross quarter the By capital. significant X in seasonal margin quarter pay X.X% with sales EBITDA down key incentive quarter, BMD compensation of XXXX. from for segment filed in finished million data

$XXX at under our Our liquidity availability total and bank approximately available committed XX cash which reflects our our million, lines. June was

$XX excluding spending $XX this Our between and to be million acquisitions year. capital expected million is

rate tax book effective to be going our expect to continue about forward. XX% We

contribution advanced Board XXXX Tom and the the million well it year our tax this will week. refunded in let rate planned be at of that discuss the cash rate. tax a XXXX meeting $XX at is this over because XX% quarter, pension last actions in deductible below With me payments tax to XXXX Our which turn effective were to that approved

Tom Corrick

slide on am XX. I Wayne. Thanks,

capital dryer. have proceeding at in we log we value As plant working discussed grow plywood pleased Carolina modernize past spending for manner and and replace a center that creates authorized the I to am on additional and our strategic utilization key Chester, diligently shareholders Cascade to a on Board calls, our our deploy other are that Boise second South stakeholders.

a replacement XXXX. of will at recall similar in completed Some that Chester dryer we you

opportunities We have a continue on distribution businesses acquisition investment we striving our look in on to We disciplined the front forward. in activities. The with to is projects made to efficient will of Nick since be competitive as the acquisitions there position Medford. considerable recent and and and put acquisition in mill strong the In planned significant very team are operational his XXXX. acquisition good the Chester for at similar condition Nashville remain progress going competition

Our be concurrently share will Board our which $X.XX regular paid additional mid-September. per share a dividend per also approved $X with dividend in quarterly

second a pension risk announced transfer also We Prudential morning. this Insurance with

XXXX put the liabilities $XX take We of this a and us derisk matching position rate week portfolio remaining structure. potential to will to the federal advantage make asset pension pension liability the by tax a million closely our contribution to in

million $X.X for estimate starts slide up the housing Moving to in from million, consensus the on is XX, XXXX. outlook XXXX $X.XX US July

and While pressures, many support new challenges markets. key block on demand the for builders providing cost product availability, margin is facing are building remains driven housing labor for our continued encouraging and constraints

continue normal believe We return X.X starts US the at housing eventual to an starts. in to million million will demographics X.X to support the

have and In to within our Wood of in number housing we BMD earnings revenue trends, provide a areas favorable addition to to Products control continue and growth.

the we internally produced efforts in margin allows products additional Products solid captures usage flexible to and demand plywood opportunities EWP and to wood pricing as of be we Wood into more believe ahead. to and market. improves. veneer on in changes is traction have are This striving Our showing responding optimize engineered purchased system us

opportunities are just quality measurable distribution on distribution output important an Effectively of operate return national our responding safely, that and competitive Products executing half seeing the in arena, reliability activities that as We the forefront a front. second price that our job appropriate and of so of the We requires impacts returns at remain at this as managing In of and do and terrific are done both of recognize results level. commodity provides operational improvement Wood efforts pricing has shareholder the from changes to cost the year. BMD produce our a our will which in market mills at the capital. group generating local

side to product looking declining line and up since and push elevated seeking pricing active Commodity his other geographic are team has extensions On levels specific Nick the mid-June. in earnings. Products in from sales Wood avenues growth pursuing been markets, and acquisitions at

prices move we lumber Labor as stabilize construction and the fall season. and structural expect panel into to past We Day

We employees thank time. please safely. call our again this any would us open our appreciate for outstanding job on this supply in the close welcome normal impact markets. of the will to our transportation, beyond change and the earnings balance number direction businesses. factors demand However, other policy To and The in you influence to you working morning. joining Operator, for want and I lines? and each the continue the both questions second quarter would pricing rate doing I trade year an of a of at of phone

Operator

Instructions]. [Operator

with Our Staphos first Lynch. Merrill comes from George of Bank America

Your is now line open.

John Babcock

John actually on the Babcock for line is This George.

to Just wanted here. start out market the on

stand look if could also Just and mills plywood where inventory about supply the order was in chain. wondering files at talk you how your levels essentially

Dan Hutchinson

This is Dan morning. good Hutchinson,

the of us. and front Our few At order reasonably we files plywood always look weeks keep a strong. in try out facilities,

in I let and him as And good on opine I that that. So might -- I chain, to think turn think we're shape supply far and don't one inventory over I as there. Nick

Nick Stokes

commodity eight know, there's supply much you in suppliers, chatting weeks been chain. the you the or and sense in decline. an customers the for no I last six anecdotally, hasn't that As inventory tell other there is that would given ordering data with the overall our specific the gives price you in feel

weeks. And abundance to a over order but don't big in cycle don't an here And the time there's would there's so, reentering I I think I shortage, folks channel. be of few the expect inventory next the think

John Babcock

I in then on And you than that. the markets wanted on next, so Okay, also, there And others? far has seen really operations to the in and markets that have also certain perhaps are thanks for had that transportation are XQ then challenging and touch impact more what XQ.

Nick Stokes

tell again. last has environment Nick winter is and would we This that that on disappeared. early spring, you rail that faced I essentially the inbound

those kind I running lead-times, think cycles, things. traditional traditional railroads better, of are more more the much transportation

of a in of can. challenge equation, we're and continues and just the scarce best be through being we the it expensive managing to On both that side trucking outbound, inbound and terms as being

an about difficult I more that there other To would that and an the and situation are think that forward. have I question everyone geographies think adjusting transportation to standpoint, even any don't answer I a going circumstance or suggest know I to industry-wide that your from that's that. are know I specific is data opinion

So, I blank a you am drawing for there.

John Babcock

on a the on commentary. was touched then Okay, and the little next the tariffs, bit question in this just

a China's on you latest but market the logs sense and also impact Wood get to that expect going for Boise's on impact of Just initial want potential to how the thoughts Products, on tariffs forward.

Nick Stokes

supply you puts puts us that take people side, and tell distribution on inventory. to better would anything friction creates want because generally uncertainty the I more a chain on the stuff of that position in out will

really being more impacted a is to logs and hopefully suspect we together US better XX% things what taxes export China. Because sorting the people so with logs. On the haven't be of seen import tariffs the three put and and much the directions. than their get solution longer, in next by two will on continues over longer But both come heads on will up the there between list months to out I

Tom Corrick

but a the and a place, we transition This off price is I delivered are products. business cost driven would in of the the our Tom. are is in business margin there put tariffs as add distribution

impact increases So, we clearly are those customers. our on prices, pass higher intending is to but to the

Operator

with from Our next comes Brian Sachs. Goldman Maguire

is open. line Your now

Brian Maguire

question project. Chester CapEx the a might year. and that wondering Just on versus any have you $XX investment. year you that this $XX of the the next on details the could on on size Maybe million some to impact the give investment. expected timing if that more target was might return maybe And million I

Dan Hutchinson

little those is end will hope end work delivered The this new is primarily two be of things -- definitely again. the two we're fully Brian, dryer April, putting some mill. LUC in combination Hutchinson LUC to of replacing the that will sometime We the equipment. and There by by for we that. things of is The -- quarter. have and other front the a done ahead are of but should incremental old are work the doing the veneer, by the add that One fixing of we end there. Dan in doing second be the bit a dryer

Wayne Rancourt

XXXX an I So, the be of in see somewhere the additional impact the impact, on I capital project, And in that think given I look range CapEx. to terms year don't $XX timing -- just don't of of to we forward impact the as next would any million.

Brian Maguire

for question Nick. Maybe just a

tend bit industry. Just volatility the and Wood be how I the cautious in a to than own know your prices you inventory managing are you little levels? in Products past more guys overall the

sort impact take are on are to you how wondered Just these just whether you And with hold? general prices. inventory related if question managing the on to have for that. decline Wayne inventory And charge in of sharp we XQ an thoughts seeing, might levels any

Nick Stokes

will product product because said the of product, comments cycle is that continue concern kind service the trying I he you against managing to was is to availability This to as of think expectation understated costs environment, down Tom quick his customer forefront having in the opening cycles our know, we're our at that challenging what When balance it. commitment decline. and do

the are the do for sure will satisfying and that's customers -- every that what selling buying of inventory make we kind are balance that, we always do, day, doing we moving need the and keeping we and So, forefront. the

to I in let on economic As impact, will weigh the that. Wayne

Wayne Rancourt

I the and think end happens between thing, Yes, is big Brian, the of what September. now

write-down impact end have would the it on next having on that think generally clearly weeks, declines us September. couple at margins. sharp we of have bottom or at that here a would If the if quickly the inventory in panels weeks six in turn And a first the you about through most look negative we we've will for products sold lumber. in had the pretty five you normally find of a commodity But enough

find is at the the the quarter decline end June. prices you time go the you basically we the protracted was that the One we back And last second of of of to reference have take of could by five did things I quarter to XXXX if look it bottom latter be by April through here. for on weeks the use August second-quarter cost quarter from in that of as September. might this if would I'm and on impacted down from distribution. impact that margins And a another into XXXX prices or instructive part what think as lower a lasted the beginning not market as end long I continues Again, commodity a to But adjustment. an six had expecting of

Brian Maguire

point good reference Okay, thanks. a That's us. for

decline and outside and how of much cost of The in there, know from was volatility last it's the the Just driven one how that is wondering kind was it saw. just versus I me. volatility product but related margin that of distribution, tough much a we I by one prices comp

Nick Stokes

As two as and talked that and you pricing commodities; we've times a mix commodity know margins is between and function and of margin calls, with line trajectory. BMD's drivers, are the the products commodity than primary these other many on higher general associated the

last was slight by in of headwinds the pricing. negative commodity third the of on dip the second terms so, you saw of the And driven quarter some

a general rule in line gross than carry a lower As the margin the EWP. commodities general items

So, biggest commodities, plus where XX percent points probably second basis as of quarter. percentage sales decline higher to second thing point on on X quarter we the that's the a were

Operator

from Dillon comes Research. next Vertical Our Chip with

Your line is now open.

Salvator Tiano

Chip. Salvator Tiano filling in for

through quarter-on-quarter. six pretty were is question on past EWP going price seems pricing. first wondering, just the was in my good like better it expecting realizations you than are to So faster months? and you And year-on-year and got I some increases three

Dan Hutchinson

expected. we in It's business you takes them about this while through, get for as know, -- No, to just it what not a really. is this but

Wayne Rancourt

of increases larger in of we what XXXX some the customers protection. the seeing, think price the we impact announced have Salvatore, price and you're I Yes, is

as increases And price we off. to the the had related price XXXX of XXXX. in some so, rolling increases early well, protection And

price And modest And expect move so, on of XXXX you continued and a the of through are we for those the combination as XXXX improvement prices year. the early would we seeing really the increases. rest net

Salvator Tiano

margins. Sure, on I ask And building distribution a can if material follow-up perfect. the

granted how a we point were quarter can think expect X QX. that margins one similar was You I up XXXX looked X% scenarios off and broke at think to down sequentially seasonally I percentage -- some weak I actually and --

actually, we second-quarter So the I'm I into quarter, firstly, wondering, X.X% be record was as this quarter achieved operating the would that The think well we're a margin here third looking me the -- rephrase. base what segment. let for

we'll you as margin obviously we So should if -- expect X.X% think pressure, some normalized you base Is should base will that the but didn't see mentioned, what achievable be? off this from from closer in and higher would that last traditional one-offs benefiting that your quarter? Or third continuous be to the X.X%? something margin some year's decline is also was pricing we

Wayne Rancourt

has business Yes, I about is the last the tailwinds quarters think we have Nick's from rising of benefited what commodity couple prices. talked

six tailwind a gross up And headwind. turn think has Some into will of that some we shown on based of margin. obviously, in weeks, that the first

think of -- is have from a for the operating more EBITDA pricing. because couple in of normalized pretty that probably historically X.X% the you're we last revenue We quarters that build leverage X.X% what in commodity amount to been expense said And X.X% has significant business. seeing part

we fall reverses, they gross case in in margin prices, know have, that. obviously the will a And we unless into as think that our the top-line trend we as will down with that in X.X% OSB but leverage trying compression. to better business dimension impact I revenue prices in that is normalized will continue we don't and in expense we margins give do than go in which for more particular we But the again, distribution margin will up obviously a third are see range, lose as lumber quarter. probably some lot gross So negatively

Salvator Tiano

last one one. just And Sure.

was bit And give had quarter? some completed in what contribution Can any if Were during progressing quarter. us could figures the You you their two us acquisitions were synergies? you a top-line little things you terms income tell there? achieving in of or how the

Nick Stokes

as I would are well the into well, We system expectations or both the as very Norman happy operationally integrated we're with line revenue much our going very tell per-unit both and our disclose the EBITDA. overall you Lumberman's don't and those. acquisition in with acquisition being very

Operator

comes from Bank Our Montréal. with Mark next Wilde of

open. now is line Your

Mark Wilde

like Tom. how in market, and start could Tom, I months. a recent from broader market morning, read the both perspective. morning, housing weaker maybe repair we starts if Good been looks numbers industry on actually get have Good and right and big of seems some Wayne. on housing wondered your on the remodeling picture now the It

Tom Corrick

-- I the expectations that talk don't into see we same We you provide I builder and that pretty situation have we relationships any tell course their than and on change real see in any can't more with, they statistics we the customers the as you that. statistics to the But insight feel bullish feel of the actually underlying year. for see the they like will

continue feel still good I about there. So the to prospects pretty

and Dan, trends. I bit. That's that? see not down. would a anything to On slow just or typically of don't weather the the the weather. slowing in people year things with this we're anything you have But remodel side indicate down because Nick like our that in that I time XXX you see a add heard that conversations mean, repair reduction that anything would really I seeing in working are things underlying indicate degree would don't

Mark Wilde

special right Tom, whole about capital dividend if second then, for fitting how manage sheet. want wondered allocation a kind little All in talk the and with strategy I the more question balance of your you is how bit and you about a to this could on

Tom Corrick

to going Wayne jump Sure. that, in I'm well as Mark. on let

since the to to really going we you And preference we've to to profitably about the think we communicated we the very IPO. it about benefit going are to use consistent capital, where deploy business think how the have always be our can shareholders. I how been as of this grow is

changed. the really about we underlying tackle that think that I so, haven't thoughts And how

sense. to it makes going are growth where pursue We organic

to to from our things keep do the a capital going base do assets program competitive. to need are we We

opportunities acquisitions I We continue to we on to acquisitions and now. at other look two in going that quarter Nick had the right second discussions in are think the and are

I are existing we and of opportunities, markets take in only on some can expand to focusing actually additional advantage the growth distribution not at space continuing markets think looking opportunities. look at we we to in progress make but infill as underserved ways

So as shareholders. look will continue opportunities ever, Mark, we to growth think a have benefit we our that at positive for those

clear In acquisitions activities fund, on elected in we And that addition, Wayne case good I do do to quarter, continue we at to additional and have with shape. And to are do are have dealt you we value in think going in that. it we taken adjacent in need to and -- to the in of But as how excess thing is things those we of the look I the going it's space. those opportunities frankly, the to I this think strategically look create framework pension adjacent in dividend. very recent do our sheet see opportunities, degree with we've the to we that to we with really focused how the cash that, second on proper balance be the at

Mark Wilde

from inventory gains the I quarter rising the to two the the it some just environment? One, in second any higher that benefit in costs? OSB then other also both is of Coast log get helpful. price Okay, costs, sense West things. wonder that's of possible higher And impact

Wayne Rancourt

prices biggest wouldn't any Mark, and look XX the the if we plywood got -- I I bottom here the inventory I that Dan you half gains. somewhere about in two on number of think based by through. environment price two It show price far at to around -- on was far and the variance positive wood. and this line the up think if and West you logs log and on pressures variance Yes, would largest components And negative South/Southeast were we in that. in basis variance dropped cause quarter sold the to OSB. probably logs in on biggest Wayne XXXX. the rising second year-to-date XX% -- costs the priced And we EBITDA the have, Northwest as lumber were that were the the have the give come the the they one were moment. cost cost And Northwest will flat logs but in see just we -- of to of up well, XX much chunk the in basis moderate if price cost compared sense; year-to-date that's overwhelming and as Coast is Northwest factors, And costs drivers fighting are off as OSB, rule, the now delivered a dimension product as only And general the a biggest clearly at log took we EWP million

Tom Corrick

contracts because would that log at response been purchased price. have logs even we I higher degree purchased down that add process that Mark, product to on costs the And have longer-term move in to declining prices, all a that's

to with a costs have So, lagging that. is up that catch process

Mark Wilde

the the rails see catch these last velocity an is -- of backlogs, but from when Okay. how maybe the this improve All just right, for the order as effect on Western much up in that Nick was is coming one of impact Stokes, Canada you guys there the out a me being now. is go on those like market? of having market? lot If on on the first we that down are quarter, Canada. to the of the What's drawn lumber back It ground sitting inventories in seems

Nick Stokes

the into that side a conversations when that's our they I chain on get I the the flow, articulated. the supply again, tell at caught Boy, side, Mark. steady steady think to used with What an and tough metrics, as both terms accumulation folks quantify are supply in to and up of you dynamic of would is destination. bit happens a the getting customer is flow in turns a any you one of kind

know I some it as degree normalized. some answer the And erosion the they X%? on has the chain it's had don't so on supply Is impact price think an commodity to ordering. some degree it XX%? And side to off that. Is the back I to on of the

I by that how think behavior and has unique process. terms they impact by had in varies that of through customer analyzed But their for sure. it varies unique geography an

Wayne Rancourt

a help August in the because South. of weather Wednesday in of July get you on having typically a We fall that hot year. And Fourth July slowdown the would and tell this didn't I

So view see heading pickup September, balance. is in us I as are demand into to think we better weather put our we cooler in to why that should get likely that's a

Mark Wilde

the Okay, second of luck that's Good half year, guys. helpful. in the

Operator

[Operator Instructions].

Chercover Steve with next from Our comes Davidson.

Your line is now open.

Steve Chercover

price the that So, a Is let was question that a than make Western more answer logs. plywood high the -- first. the of of on market I'll Southeast? one -- And price Western it resilient you I well, guess in little logs

Dan Hutchinson

I you back, have get West pretty that manufacturers money coming think the probably Brazilian the in Coast, the has in. obviously impact some you've robust Also the so markets got on have and it. Southeast wood their on impact to less

Tom Corrick

have demand markets Southeast would as major add think start-ups situation less well. panel on our Steve, seeing I the you the side Doug overall that in some OSB just then the for also, And are tight the is Southeast. I in we Fir structural

Steve Chercover

it? indeed color grow logs desire manufacturing footprint and the you'd cost your of to how to if Okay, does your expand relative like

Wayne Rancourt

I you XXXX. of see can to going back tell you would -- that kind

significantly reliant Northwest last South on to South. more pretty Pacific the just and, have been tried years what stocking up and US the do private Southeast levels to we've gone five the housing history. the is forests company a of we've and four it's forest to footprint the state downturn over the federal the As on in tilt and the growth rate And where because in where frankly, through more manufacturing

of seeing to place you're the our lot a think you are better what starts can sellers. like over I levels into in South/Southeast like lot east trying and a two we South. the is And good of just to to before But get etc., or low-cost veneer us with private and Washington. felt sure take where a do housing manufacturer capital. the isolated still EWP deploy downturn. capital wood that's of thirds pretty a basket Mississippi product to inventory that Northwest think There really that we next make the stumpage see not operations forest, I And there's to and focus Pacific was in the prices we So continue competing River the why of Northeast are key can of time the the relatively high-value advantage we're move

Steve Chercover

And then I didn't the special with use you too respect but this dividend, to want the to much, variable. don't word beat

forward to year lenses, fresh an So set basis? fair beginning a is to opposed with annual be we to the say should of every is on viewed this something of that look as it'll it

Wayne Rancourt

we paying special to would we And that. and a purposely somebody's the think And and not because dividend clearly proceeds you out one don't divisions, process. taking are I they sold operating I used tell formulate it as additional. word use we to didn't the five view want this it's very got they shareholders. is variable

internal dividend. to and a periodically growing But going view I the hit that deploy you with that, And wouldn't a And periodic kind to sheet do the capital to and very it's for this into that the As back there's don't outlook repurchases; capital of business. sense got Tom conclude offer. Board we of again, acquisition on I internally the as the our our share tell a as what but operations, front. seeing this preference current deploy three we're evaluate shareholders, balance also we've kind special to think needs And that schedule the the was I we is and of regularity our extent will capital onetime I described, would it you there's avenues, waterfall additional with state the tell including regular this. we view strong to dividend; that makes

the to capital more one preference to business, this in Our growing but is deploy get is just it to shareholders. revenue

Steve Chercover

what to you -- do Is enough? used but or think can there you you any whether that there, I if the adjacent. $XX limit cash potential acquisitions, made could the still big was mean it obviously with there's something I be of -- doesn't actually million it's borrow respect word won't

Wayne Rancourt

to that if know BAX. point, I you are and but by just got mean Yes, saw, we don't Moody's I at upgraded we

very, frankly that in private notch got with adjacencies terms feel and of them we capacity have make competitive we've the And to in shareholders. think we arena the ongoing equity be investment have at I want last to we XX over months grade, been very sure pay that going markets. the XX we thoughtful guys like to to one our our what is being undrawn really it add below value capital is to feeling looked the bank we've access the So

with got June for advantage over make we've financial that we're you cash again, should toolkit. wouldn't It's basis. acquisitions our think sense this our Board we feel more shareholders. on But like to I formulate in going one concluded I they just sense. firepower a take at looking made $XXX we plenty balance million tool our of at And with tell it of that the So

Tom Corrick

tell of issues the would flexibility I Board time a was the that the that of the you we take opportunities Steve, lot of And discussing available be that downturn. next maintaining we with will the advantage spent clear one think in to

act want -- this balancing Wayne. think sort about a with to any future. is agree I this and So see as don't I to you cadence of the I

Steve Chercover

Okay, see still market deeds the well, goes unpunished. make quarter. It's good that good to no great sure

Operator

& Sidoti comes Jacome from Dan next Company. Our with

now Your line is open.

Dan Jacome

the A sorry imports into quick here, Thanks. cautious if incrementally half? driving more I on second it. missed question outlook What's

Wayne Rancourt

we've Well, had I until markets think up structural very panel now. tight

at two trucking to tight and go in depending look the of it's as in April/May/June that rounding that we Brazil when market things. for added ex meter months. adds they or grand coming get October. Brazil pressure a off in source I scheme couple imports could Southeast where we down markets second the the brought week think into And volumes a you we in demand in if OSB in selling more on plywood pricing they've And rate with the last and again, error be September in XX,XXX slowed half Brazilian And where as the of so, the shipments OSB pressure this the the strike been at And not around coming cubic the levels the far think was. supply be as will it really one became and

Operator

questions I'd Corrick turn to like to Mr. time. And this further remarks. Tom no I'm at the closing call showing for back any

Tom Corrick

to everybody operations private really went what very call equity out I'm our divisions you today. in performance the we the we've want had was quarter obviously since pleased enjoyed attending transition Thank great best lot with of for really through in second for the safety the ways. the in XXXX, we call Great. a quarter. do to different operating I

in the capital I returning strategic was that of was many think acquisitions our eliminated the a notable in deployed the maintaining capital in perspective the where from fundamentally other exposure some and a to in that thing ways growth pursuit quarter advantages position key to liability And our about getting of organic of allocation and the our shareholders. pension we assets space. our ongoing to we've the BMD cash and liability, actually

I So, what's for and quarter excited and active really successful think a coming ahead.

Operator

today's This in participating conference. program. and thank today's for concludes Ladies you gentlemen,

a have disconnect. You day. may great Everyone all

Boise Cascade (BCC) 6 Aug 182018 Q2 Earnings call transcript