BMCH - Earnings call transcript Q2 2020 | BMC Stock Holdings, Inc.

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Operator

Good afternoon and thank you for standing by.

You are joining BMC’s Second Quarter 2020 Earnings Conference Call. This call is being recorded today, Monday, August 3, 2020. Michael Neese, Senior Vice President of Strategy and Investor Relations for BMC will now provide the company’s opening remarks. Thank you. Mr. begin. may you Neese,

Michael Neese

on located. Good of call. welcome our North your are I well. Tropical to to joining safe Victor. to Isaias we second our Storm potential move families our area, impacts quarter Carolina headquarters and call us for you earnings hope in Thank Raleigh, notice afternoon you, where as to decided light and today XXXX are short the Thank the you the and of

As thought afternoon. accelerate we a timing our to result, sense made it to this

will For our update Flitman, today’s response, X call, our Dave our during on second Chief including and Executive results priorities Officer, on our pandemic. key highlight quarter progress COVID-XX record the you

details results. of our Major, Jim Next, second further our CFO, provide quarter will

deck comparable include our not afternoon’s directly from useful of items. discussion corresponding be at why measures the for in measures. The non-GAAP non-GAAP press isolation website to the and the and at the certain In prepared this for informational GAAP are and most available during slide they of discussed to GAAP these the presentation. We they release believe investors be are we will results of measures slide reconciliation purposes, can considered back these found should provide a remarks, GAAP this on and all to call and ir.buildwithbmc.com. our non-GAAP release results press adjusted addition results The the

future call forward-looking could results review materially contain factors forward-looking and meaning filings the Reform of to for release the With will Our over in projections press Act our from and Litigation projections. remarks release, the results. within our to the in cautionary Private statements Dave. this actual today’s Please press section and I turn and of that forward-looking that, the cause now statements presentation differ various Securities call and in statements SEC

Dave Flitman

of by COVID-XX We want start on I fighting for and health responders. continue joining and strong meet continue doing saying everyone to all the is adjusted and and thank to to, net work this our very prayers to EBITDA the to our us. margin. to Mike. again, go record I proud especially of associates, times. afternoon, pandemic. also want these all afternoon, keep are our second I thanks all and want needs everyone first results workers unprecedented thank themselves I EBITDA throughout quarter highlight who frontline battle, care by out of and safe tirelessly nation’s customers. our discuss adjusted our Good the they to Thanks our who will This thoughts affected income, those am

laid our I on during our call. during we wanted results, key I Before into out progress pandemic, to get earnings which you regarding our priorities the quarter’s last X update

disinfecting is when was the well priority associates, Beginning cleaning challenging the suppliers, social daily face from we top at of the distancing continue our of made took to areas and task situation to our and protocols. as and as social not force all locations suppliers to for to customers required Since March, Safety coverings remains as in several we respond facilities values, detailed all that associates our evolves. of and steps First, customer-facing possible and be meet of processes in worn June, that roles. ensuring safe of we is distancing families and our one associates, real-time our One have importance dedicated functional to implement all evolves. at that react to ensure step we such customers communities. keeping are associates are numerous a pandemic as these protect BMC’s safety times. utmost created the core and We during individuals in up

self-screening we the We conduct CDC facilities, And actions. associate calls reference must a BMC requirements. managers monthly checklist updated safety provided instituted We associates to local facility. with new with to enter answered state, have which an our and review symptom and signage the continually improved questions, latest with be to before

take continue We monitor necessary appropriate of all top on safety to always and with our the situation and the agenda. action,

in first improvement and XXXX, savings trust pricing in approximately more the injury productivity our than has efficiency is accelerating at BMC projects and our XX% Second, improving have an which delivered System, preserving during half throughout increase driving times, across and processes increasing the implementing as critical our safety truck performance. Lean initiatives management $XX.X local acceleration operations. service while include our XXXX. in business, driver measured turnaround manufacturing productivity rates, best-in-class improving Sigma and Six aimed margin operations, Through of that Operating to many by been we level, half recordable cost the of improvement our from first of our driving productivity million XX% Key a reduced strong

focused on a of improvement this and to resources highly are teams creating operational Our culture have supporting dedicated continuous work.

basis our Additionally, declined to as of System net points Operating our XXX a percent we initiatives XX.X% accelerate efforts uncertainty. our took and expense the SG&A swift to economic sales amid as industry action beyond

business. $XXX been the approximately on our has the accelerator our area we had against financial and a At We quarter, important to borrowed and finally, revolver. our productivity will year the of end company liquidity repaid drive step in liquidity as throughout previously this million, continue of $XXX.X And maximizing of the also strength we second our total million for us. that we was priority this

of X.Xx XXXX, until no and June have were We debt as we levered XX. maturities

quarter Now, let’s second our record results. to turn

productivity of the second coupled our results business, by structural cost across execution savings pipeline exceeded our activity. of accelerated steadfast and expectations, a strong driven our with strong quarter strategy, Our construction

generate business, Pro which as record We’re a service the resulted of doors millwork, our for segments determination and in team’s sacrifice strong outstanding are pleased windows, net of value-added market while enabled single-family providing quarter. income, their remain results in starts, true of personal adjusted despite and focused all strong to net environment. the EBITDA the outperform Multi-Family to growing growth that associates as in testament sales unprecedented us our and customer EBITDA efforts Remodel our on our this in continue to who well the adjusted segments These margin

activity housing during remained of July. of pipeline the months Our strong May through

However, we’re mindful the fluid pandemic are that very evolving. COVID-XX and the impacts of ever

growth firmly in maintain correction our took Operating out adjusted impact other We productivity EBITDA will necessary primarily further early to These strong As of gains, acquisitions record System out-of-period X% our actions. of and in a the results. inflation. BMC $XX year. excluding stronger, financial strong was on our as of X.X%. strategic decisive into we quarter now the sales future to driven to come increased the $XX.X million, company. to this as and reductions, margin adjusted actions and This price by temporary approximately grew a believe and growth million. growth, second more decreases situation position continuing headcount decrease result, driven the actions we’re well prior from million profit acquisitions EBITDA and translated compensation quarter of decreased dollars XX% a record operating in $XXX.X to of our some by SG&A expenses will by strengthen we by Net I X.X% gross controls We second $XXX.X highlight million, a for nimble nearly

for by windows by first and segment of the XXXX. doors millwork, digits grew X Our quarter for and X% the months double

strong industry long-term grew Our expectations. underlying demand Multi-Family homebuyer approximately respectively, We and XX%, record Pro the housing rates, our segments ahead of are low believe as and by strong, inventories. and fundamentals Remodel XX% evidenced performing interest and well low remain

In $XXX,XXX. above revised at And single-family houses rate new the fact, rate sales of we’ve in June least of seasonally were annual X at home inventories new adjusted $XXX,XXX, of lowest May seen in years. XX.X% at the a are

on as previous our call one over to I’d valued passing calls, highlight Jim, many Before of to like the done associates. I’ve

production scheduling Pacific at our dedication member link our BMC her As an location, sales Edwards’ and Auburn, a our and invaluable and of team between makes Northwest teams. Washington production to experience Lori millwork supervisor critical

during her job shined her during day-to-day generosity a character tremendous operations does and location’s second Lori her While of the work, through X-week suspension in really quarter.

third To partners strong who half to us by can a performance, of proud hand, in XXX to have we over on made outlook. at positive for Lori their select heroes coupled she quarter look our solid and proud am wrap thoughtfulness second first the community crisis up, fabrics the made took supporting Jim and result coworkers quarter our detailed many extremely than in one I interests. turn masks and quarter. are in the to selflessly her helped a reminder her and bounds, hand to people’s talents customers, of that record who you, Lori, the Thank XXXX. communities. will designs times I and that her helping and second Her home, associates, of time out knows face the While teammates, is With fundamentals, that, industry even usually bring and the at she our half and momentum our underlying continued BMC PPE more have the team. and the people. call selling unsung we’re Lori coverings with the results We in believe kind, at used BMC, She results are personalities members. will a make our and Like tangible deliver does for no cloth reflected best of

Jim Major

greatly of our in thank our would would dedication discuss we financial for X.X%. also time. We during solid growth our higher like are adjusted associates focus on appreciate line this which revenue and communities. forecasted Dave. incredible their top to EBITDA everything delivered they I quarter challenging I We to lines. and the and than came doing like customers strong results, Thanks, for second

construction Pacific to state some as Arkansas of pandemic, orders, in accelerating remodeling paused partially core Our the net first commodity Early offset down by a activity by decrease increases half or volume in of the shut were Washington California, a inflation. markets quarter, price was driven by in Western operations in in which our decrease These declines construction other second and briefly and were driven due sales to COVID-XX-related impacted sales price a heavily due due growth local and impact the in the in back and closed and Overall, X.X% Pennsylvania several suspended due by X.X% shutdowns of primarily inflation location. X%. declines stay-at-home multi-family the organic activity to contributions our bounce our came acquisition of from organic quarter, and X.X% were Northwest strong quick was of which higher-than-expected facilities mandates. growth divisions. to Organic

by exclusively impacted this as almost components single-family growth rates our result, that homebuilder structural with customers. a single-family product in As our is category and homebuilders purchased

would I starts, significantly low that single-family However, were the mid-teens point down quarter. which the second in to outperformed out we in

are In doors with believe shutdown in increased in categories quickly half orders second addition, our rates the we now poised in recover to of growth millwork, the lifted, segment year. Sales windows and X.X%. these

strive gain value-added to in sign this as share an encouraging segment, higher-margin continued grow products. organically We our we to

strong remodeling respectively. XX.X% multi-family also pro XX.X%, We were growth and which up and saw with contractors,

$XXX.X were second Turning to margin solid XX gross millwork The was stronger-than-expected, decrease categories, expenses gross quarter sheet mix discipline highest compared category. SG&A of Overall, X.X% strong gross structural XXXX. gross million. X.X% by XX% the period. for and product for of to XX.X% lumber high during gross from which was lumber a sales $XXX.X percentage year sales, is margin prior as gross pricing basis profit decreased very margins which unusually to goods the margins by our and the of point margin in to components driven commodity or decline profit in quarter, price-related a million increased the by driven gross $X which and million, product a benefited of

you XXXX. out-of-period we had the recall, quarter may in As of correction an second

an quarter approximately wages, recent Excluding increase million associate of our decreased expenses benefits acquisitions. SG&A costs, impact, The $X.X reduction of other fuel $X to costs. would other in lower to costs. second remaining to related lower These savings SG&A offset this Other partially to million decrease in and decrease million. our expenses changes associate the and travel, related which and was were in lower fuel million expenses related $X.X We include $XX temporary primarily prior benefits estimate an by circumstances employee-related costs SG&A include pandemic. factors impacting approximately a of cost XX% due

consolidate In we X addition, to occur decision third quarter. made in underperforming which locations, the the will

to million Adjusted XXXX. a of We in million EPS or $XX.X record to quarter EBITDA increased increased $X.XX $XX.X share XX.X% diluted Net have year-over-year additional share the XX.X% no to Adjusted record per immediate diluted to of million. close $X.XX. a second plans compared any income per or locations. $XX.X hit quarterly $X.XX

which extremely We XXX are with X.X%. increased points our record EBITDA margin, basis pleased adjusted to a

In focused fact, our in controls company will continue a on the record and products yield value-added EBITDA industry-leading to our adjusted X.X%. to quarters reached LTM come. margins margins solid cost and Staying

Let’s now to due changes increased to receive capital. the million our longer provided primarily due levels inventory higher to cash cash lower-than-expected $XX.X finished and turn from suppliers. by And million, with products in quarter times lead $XXX.X activities customer operating We flow. to working demand to

million cash will flow the was the million, will borrowing expect cash facility. under year, positive and availability cash approximately second our of and on solidly XXXX. which liquidity asset-backed the of $XXX.X second of of million $XXX.X included We half of focus end generation over revolving remainder continue at to the the credit $XXX.X cash and free for equivalents we be Total quarter

During borrowings revolver. borrowed under this revolving our million any currently not amount the under first and our outstanding we have do facility XXXX, precautionary quarter, In as credit repaid June $XXX measure. we a

as maturities long-term no Additionally, until have XXXX. we Dave debt noted,

is net M&A. end, pursue of This gives adjusted LTM in our to the was long-term substantially our our X.Xx and strategic leverage us quarter debt and business reinvest X approximately EBITDA As X.Xx below target the to flexibility of our EBITDA.

opportunities $XX those strong. While overall were remains the we most due second did and components Most in-flight second Capital of technology capacity of million $XX.X paused We and to period. have conversations the second million repurchase very pandemic, seen resume which $XX.X expenditures XXXX. in will November prior had of attractive the We to many continue year millwork. automation purchases and acquisition during investments down productivity, fleet $XX.X remaining were pipeline facility, the million, the in half projects in that under repurchase the the totaled deployed the safety, discussions and to which to in of shares $XX quarter was quarter we At end, fund any of equipment share efficiency. and authorization, million expenditures still capital be not from replace have quarter. approximately throughout aged primarily year. These of million of will and current expires approximately used enhance vehicles assets support the structural

would are you are today. are remodeling we we demand sectors. traffic business and seeing Currently, are conditions, like in Most current buyer to our with seeing all now facilities the in and Turning orders. new the to underlying of share home what builders increased open, we single-family and seeing strong

across line different in strong value-added top drove saw continued types. July, and where products momentum Our demand our we we customer

$XXX on nearly index $XXX the dimensional record a it averaged lumber a increased over XX. months on July X past XX% in the second by of the from low $XXX While quarter, XX has to April

we gross in growth While back XXXX. of gross pressure these half could our expect short-term prices percentage, the margin rapid increases lumber put on in dollar profit

should compared back cost million. And of range a be as the top will EBITDA More we prices are well in combination year-over-year quarter $XX believe higher a and to our leveraged half X% QX of expense year-over-year estimate XXXX. position to we us adjusted and we housing in of controls third of recent in look $XX our would preliminary across EBITDA as XX% sales net inventories, trends operating to for as strong July our the line home SG&A increase to sales the approximately new specifically, we as trends The sales expenses sales percent our starts, reduce commodity expect at single-family adjusted to prior revenue growth million prices, growth higher Additionally, year. and base. our in commodity

and value-added team generating Our cash expenses is maintaining on highly flow, organic strong growth, focused driving reducing liquidity. operating

let So turn over Dave. that, to back with call me the

Dave Flitman

Jim. Thanks,

with operations our have we results. we actions paid As quarter took early off the ongoing highlighted, business our manage and to record second significant

Although distributors. we slowed our ramping M&A conversations down perspective, private an the are up now from pandemic initially with things

remains pipeline important growth continued of on and strategy. never Our very extremely stronger, I I customers these associates been about proud today has am of been now focus their our M&A and of our pillar X candidates through our a inorganic and acquisition I business years together. navigate am for our I potential. been have never we nearly great challenging as with than times more our company future and have excited our

drive pleased first in eager toughest problems. grow growth, our productivity the innovation, customers and still our are We remain I with work solve associates to more of and early our are we innings improve helping our half making business. underlying progress products, to higher our margin couldn’t to their be the while value-added our results and

As business confident the field, company our our on an operational And also and to work last I market outpaced segments, achieved our we believe have Jim we continue right powerhouse. X.X% the substantial over for margins on hard into please shareholder long-term strategies. that talent of execution, have improvement a have as as today consistently remain XX market value. EBITDA and result but margins we growth again of months, I our best wrap outperform transform underlying strongly efforts further the deliver focused will only am the industry-leading not to strengthening the our our for Victor, in profitability value-added we with team’s joining sustainably LTM up, us Thanks and will Q&A. lead we time. enable still the EBITDA into us To be see over in ability safe. highlighted, opportunity

Operator

Our with proceed comes question. first with your David Please Baird. Thank Manthey Instructions] [Operator from you. question

David Manthey

Thank you. Good guys. afternoon,

urban your this that foreclosures potential thoughts give rates any mortgage next do or and is and Is everything. But the of or low flight on have defaults or the that know credence theme and the could inventory something you about disrupt homebuilding you market screen over today? any I X? year So radar that do lack within the that’s

Jim Major

that here I we uncertain markets. today, certainly, that’s mortgage a risk. a underlying on. mean, with sit is something impacting that That we But I the eye or seem close obviously, Dave, – obviously, the keep suppose be does market that, Yes. economic times, not to as

here think, Fed to that’s foreseeable certainly their and future. is the now. markets right within government, I And would be and accommodative, so to doing continue expect we the certainly, power And pretty supportive of mortgage for everything likely

David Manthey

Okay, thanks mentioned reduction. accelerator half that the also was the stepping second, you temporary. on in you about for of of mentioned But SG&A that. And decline SG&A

$X So we away the you if SG&A is case, half right million are temporary, quarter that is is jump then permanent? third look the Does at if temporary see that that? it piece the million back over you the do scale saying or year-to-year does the when And back? that back how or decline, come does $X $X million in second

Jim Major

I prior million around so $X to the the way acquisitions, right if item right $XX out from about million Dave, million. year-over-year it take kind underlying year impact think of, from also Yes. think and decrease the is $X out-of-period the you is the

would be third would back of to the sort here expect come that your items those so And all quarter. XX-XX temporary of split. We not in

travel like they are, quarter. savings year bounce likely have below While the third some, that levels, still things rebounded fuel to from back costs prior not are obviously, certainly, or in here other obviously,

we pre-COVID likely to over come actions expect to those obviously, time, back temporary levels. but, – So would

Dave Flitman

the operations did have country, across so, there. impact no restarted everywhere say, of we our As all Dave, we

David Manthey

Yes. guys. much, Make Good Thank sense. you luck. very

Dave Flitman

Thanks.

Operator

you. Thank

from next Barclays. with your Matthew proceed with comes question Please question. Our Bouley

Ashley Kim

for taking today. Kim for Ashley you my Thank is This Matt question. on

performance you kind So are the your into guide different baking XQ outlook? sales what kind of markets just on of end this across

Jim Major

Yes.

geographies. are Looking the at the our Washington particularly very been mirror, bounce But at this in think, back, certainly, back some point, the had on consistent with from has being across orders. out shutdown right? rebound QX, disproportionate that, seeing in pretty West Coast single-family in the of as pretty we impact consistent, today, a I we of hopefully, rearview

Ashley Kim

you sorry, you. And expect costs lumber how just prices? impact this much could rising you Great. Thank – again? And think margin or how rising normalize gross the quickly lumber do then with

Jim Major

Sure.

we number uptick as the to also we points probably cost down percentage, on thinking be we gross gross to to helps but the current bring what margin on XXX second about a here the now, just as be it, third down put said SG&A basis XX lumber So expect would reported in quarter do well. our percentage the but negatively would it right precise to in the that Hard relative call, rapid in to impact our margins quarter.

Ashley Kim

you. Thank helpful. That’s Thanks.

Operator

Thank you.

proceed Our comes RBC Dahl your Mike question. Please question with Markets. with from Capital next

Mike Dahl

my Thanks Hi. nice job the and questions for results. taking on

of expected Just What organic? give the the you breaking us a commentary, on What’s contribution? that X% what’s to sense down XX%? commodity could core M&A XQ inflation? And sales is then

Jim Major

we that XX we top line growth in QX, benefit exact smart lag. Yes, lap from Mike, I XX-day to that decelerate acquisitions that in the going should X% directionally, folks from you back tell we the there, usual but reported in am QX, QX probably XXXX. will, from just to inflation we to if also to there’s accelerate I price growth, the X remind going in but that just more are enough some here the of can reported you benefit would just of Clearly, did give not is the what numbers here acquisition from you, some because

and flip in QX. would third So to back what reflect have itself season numbers you also to in balance surveys what here earnings builders certainly for encouraging here of is reported here the in positive certainly Index the certainly, today organic various territory the selling into going QX. expect And a we throughout quarter. necessarily And our Lengths the isn’t then are Random in growth the fully seeing prices

Mike Dahl

acquisitions X markets that bit was my terms surprising in end the in of in the the your seeing across those I performance I leading but or terms growth what know couple multi-family commercial that more go over – in to in in just backlog would significant XQ also describe But a that, know about in the just other. could And think next growth but of I segment question, Okay. talked a you some pretty lot that are forward we – from second XQ, multi-family, and XQ. year-on-year then there have maybe would growth. came about quarters? be markets, not as of activity of you’re balanced you just end commercial those think And and impacted

Dave Flitman

this Mike. and obviously, been Good is Yes, Dave, we question, growing. have

you We’ve a everywhere. in segment. consistently several If Texas look focused go the growing here and the we row business double experienced in got been don’t East and Multi-Family have bit And and at end-use over West quarters multi-family there in been a we a after got in Coast. back, markets have very California and digits for in that time. team team performing South a very the focused they’ve We little

of just remains Our point at for is I we’ve we’re some that And in to multi-family out starting other growth growth would the up robust. here really half the the comps thing the given pretty against double-digit that decline moment we’ve XXXX, strong half rapid over back come back that time. outlook that Obviously, going seen of had, backlog XXXX. suppose in the might in some

really performance. have solid We got

for the X years Pro segment that I of us. think Jim here they and really work single-family almost nice now board. really I’d bounced July. three team are we end good And customers Remodel they’re is has said, I they’ve the quarter nice half market time. and bringing reconstituted we about thing that And double-digit are that some other seeing highlight growth. had The doing over you work as the consecutive getting of work after really back And the ago now, done is recall, that into our quarters in continue second strength sustainable as second feel there and on

Mike Dahl

you. thank Okay,

Operator

Thank you.

with Our comes from next Inc. question Stephens, Trey Grooms

Noah Merkousko

This Noah Trey this on for Merkousko is actually evening.

sounds it held lumber question, but their highest, overcut really when what at the has understand, from rise like COVID were demand we may it in mills rapidly And here. expected. better first sounds capacity than have my So seen fears like I we prices

for do or you you I’m if so continue might that or of And your demand have of expect inflation some are to that conversations you with to imbalance wondering bringing in seen, lumber on we’ve suppliers and sort ease that the market people lumber continue capacity supply of hearing anything recently? seen the

Dave Flitman

Very pieces. say I on lot would moving in question. there’s going a there’s going market. lot lot a of there, Obviously, good on Yes. that a

ended everyone reminder, bit as quite going of anticipation took that a XXXX Just seasonality as I half not think and in as approach of top it’s levels everyone for homebuilding, challenges had seen a not they challenges XXXX. On boxes. first also that, quite were obviously, have and think hold into I being, up all, big things. has going that’s relative you R&R from capacity then the think the to we as around from those work here I what staffing of normal several I industry that all come some that demand, a COVID, home up back think With increased but just that unexpected off be last of just terms with capacity demand, like all you on, robust combination at have, was reduced of things out a of they the of And only the sorts of going of year. permanent the of bit are in seeing all some to months,

suppliers, that of quickly time predict back think how talking near-term I as our that the when. but there tell bring some when they of the that’s to challenges will the so understand, expect to driving doing at that I industry number all we’ve capacity to seen, And what also hard on the not of only price and And to will can they supply possible. increase from you mills that is impinging exactly exactly that that, things we hard the quickly understand the moment a will needed over just the are we to as correct, would all levels to abate.

Noah Merkousko

that. follow a helpful. That’s And then just appreciate as up. I Alright,

continued have positive. to like value-add around pretty has strength. commentary Your even see It sounds things July, been into

might Just like it listening starts. with playing catch some them homebuilders, to up of sounds the be

growth So as believe value-added reason categories into of higher ‘XX maybe out? get even is to year your there really might that any the back see in starts half or builders the the on gas to here step

Dave Flitman

a think a strong And It’s growth. value-added of the doing we it’s off look you strategy I as record pillar outpace is QX And quite pillar. market been very back, our our important to and growth, into came nicely. organic Well, segment a that sure. very with for QX just we’ve first for

the underlying you’ve ahead the back half there seen, in the Their sales pandemic. presenting year. up. at interest traffic And I outlooks very historical are was the of They’re mean, about you’ve got half for increased back the of momentum top lows. builders strong talking that, And all the rates already second even so of the quarter. on And of as all are

So strength need think I alley. normal are of safety industry added, structural the they about need job up people done they sites, Ready-Frame future. also, And the for well around think when looking And as we’ve I offerings increased value it to builders the get productivity play I or and products the I pandemic our employees really is are manufactured efficiency case distancing. talked terms that like the of in into components, measures at And need ways the think the the what at believe the our in here Ready-Frame, the with actually right work builders And underlying what to of the there. think before, reduce new about our plays demand number and social in and you things for job to the site.

to very continue. growth expect So that we and bullish, we’re

Noah Merkousko

appreciate I it. That makes sense.

Dave Flitman

Sure.

Operator

you. Thank

next from Gilbert question Our BTIG. with comes Ryan

Ryan Gilbert

Hi, thanks guys.

mean, on in it, of be components earlier, single-digit strong question X% sales I backlog And at tracking volume. backlogs a quarter. on terms year-over-year the net remodel, orders, you your on the I the to towards builders seems what third to we what multi-family First little single-digit plus increase said guidance and we might looking growth than low have it and based XX% the in it on low in bit think based – kind better reported of like and a like seems do what are a maybe able volume repair commentary of

you’re talk number? need to So just puts wondering volume. what of now what if and you takes in the on kind market that’s can I’m And that the seeing you about right

Jim Major

Yes.

that’s think, it’s I whether probably more environment the good a in side, a the last the has builders the of probably is whether that’s But number decade, lumber. plus. case supply and at constraints demand over from as as here as builders our for candidly, are here housing been recovery labor, in the points here on been decade

staffing talked plants times with same As around of been challenges pockets lead some things their and we sporadic manufacturers just some of some there’s have of the and about, extended other that that other products nature.

build frankly, that. that environment ability builder’s feel any and hesitancy more to chains fast the to demand to demand around great, just do. to, this we on frankly, extremely constraints is end, the may point, If So supply generally good homes your undermine them and any otherwise side. on allow about the there’s as supply just it’s, And

Ryan Gilbert

Sure.

just us on category Can lumber, other Okay, product you goes and understood. sales second of percentage then what the into doors segments? remind the windows And dimensional multi-family. millwork, versus question,

Jim Major

sorry. I am

– mix sheet what’s how much asked You within lumber goods? and lumber the

Ryan Gilbert

versus the multi-family other and to sheet What segments? No. of product revenue millwork, goes goods percentage doors windows lumber or

Jim Major

a multi-family we the more category towards the millwork business. little heavily bit our overall within than And weighed

the in range. XX% – maybe XX% XX% So range to

Ryan Gilbert

great. Okay, much. very Thanks

Jim Major

Sure

Operator

you. Thank

with Ramsey Our question. Thompson your from proceed next question Please Steven with Group. comes Research

Steven Ramsey

strength R&R Quick the demand the of remodel, talk projects? drivers and insight how homebuilders? you one into me any at the Good being repair guys for have curious displayed if general be exterior interior Also you versus can you to certainly, – to afternoon. of compare strong,

Jim Major

pretty now not they is, in that’s And movies. Yes. made. reality here the had areas, to because Steven, perhaps I has because people remodeling not into seen back by so within maybe you least exterior are of little also sort while, the There’s we’ve And seen expand I is good have demand homes. activities portion or this in to the across well, we so probably the repairs been think, I helped COVID. going dollars type might not off discretionary here But some is you the than eating flowing And demand just out. at extent at time not more I a home, the they of as mean, good some much home. They environment, expect for to a I have interiors are all stuff them entertainment the real were exterior if needs living spend are mean, may will, think spending think that that from fact out. have all types wanting there’s on no seen other that decking and question people of being type to knock some lift projects. time they’ve that pushed their those of

Steven Ramsey

Excellent. out but issues market, clarify that supply And for side QX the could the guess, even of just longer issues prospects potentially higher? the single-family demand pushing want the lead out on improves to maybe in said pushes so times, QX? is maybe the supply this, supply QX the But because and into then, growth strong on sales, you I be

Jim Major

Yes.

It’s there think times. And this I just call are be to clear, them sort the supply said to issues. is have of I a I don’t issues mean, none of mean, number constraints, want and that I of right? we – potential.

to takes more the to Over time the everything, every industry just all and that. up, got ramps XX more last got it years, we labor, to time we find find digest

Dave Flitman

would goods we for suppliers sure procurement done teams relationships say our making are and all and sheet great and job, with the need have procurement commodity-based to have very and our teams nice that, buying our do get customers. that what our job the they I just a we lumber

Jim Major

of would built some Yes. to expect are that and And time. your homes sold, extent to getting answer in or over question, the you going The QX any still to that they’re yes, slippage QX, right? get beyond, in up causes pick to

Steven Ramsey

Great. Thanks for color. the

Operator

Thank you.

with question. Jay question proceed Please with McCanless Our comes your next from Wedbush.

Jay McCanless

my for Thanks afternoon. questions. taking Good

just I The first at had commodity include one Does wanted that guidance X% to XX%. clarify inflation? on to revenue the

Jim Major

through earlier, see through Lengths, in of I generally of XX- you way its the that’s all a Random selling et I terms to selling will prices. mean, all Yes, terms way some What in to there’s time in And cetera. today take P&L roll the XX-day inflation our how in. as lag prices, that work said

Jay McCanless

second question, – any we closures? should Should expect expenses for facility the

Jim Major

QX. We impairment couple in did actually a of dollars of an million take here

So in that’s today’s actually results.

those facilities costs. lease expense Just so impairment to and related those leased an took three are

Jay McCanless

me. And for last then the question

having lumber, now, – getting you your the of problems millwork, you source materials any right et are improvement it’s any Just to cetera? And you whether are product terms any in seeing availability need?

Dave Flitman

job, doing our and would challenges teams of but on Things based constant are challenge the supply demand are mentioned Jay, very Yes, I the that very good the earlier. a just a at tight, moment. I’d some it’s say

I getting full a So they’re got having just they’ve moment. they’re done. their hands they’re having would say and challenge at every trouble. the the job day, But

Jay McCanless

for Understood, okay. Thanks taking my questions.

Dave Flitman

you. Sure. Thank

Operator

at closing for are the you. to remarks. Thank management floor turn to would like I any There no this over further questions time. back

Michael Neese

for you, participating in Victor, today. and you, everyone, Thank thank call our

this great evening day. Have to take Bye-bye. We your will questions. be follow-up any of around a

Operator

and this Ladies today’s gentlemen, concludes webcast.

and this your have at lines Thank day. a for your time. disconnect you participation, great now may You

BMC Stock (BMCH) 8 Aug 202020 Q2 Earnings call transcript