Recent acquisitions and labor-saving solutions combined to propel BMC Stock Holdings to a double-digit sales gain in the second quarter ended June 30.
The Atlanta-based dealer reported sales of $886.4 million in the quarter, up 11.1% from the same quarter last year. Net income declined slightly from $18.0 million to $17.6 million, as merger and integration costs increased by about $3 million.
CEO Peter Alexander pointed to the continuation of solid top-line growth. He also singled out the success of the Ready-Frame whole-house solution, which delivered $45 million in revenue in the quarter. “This whole-house solution continues to gain significant traction as we provide builders a way to effectively navigate a tough labor environment, save money and shorten cash conversion cycle times,” he said.
Recent acquisitions added $19.2 million to the topline, he said. In April, BMC acquired Texas Plywood & Lumber Co. in Dallas and Code Plus Components in the Washington, D.C. market.
“We continue to pursue additional opportunities to further drive profitable growth,” Alexander said.
Meanwhile, the LBM dealer described price volatility that is expected to extend into the third quarter. Executive VP and CFO Jim Major said the company anticipates gross margin percentage to improve
“Our team remains intently focused on driving growth in our value-added product offerings and higher-margin customer categories while, at the same time, executing initiatives to further rationalize our cost structure and improve our operating results,” he said.
The BMC merger with Stock merger continues to play out in the company’s books. BMC realized an additional $2.8 million of merger-related synergies in the quarter. The revised estimate of total annualized merger-related cost savings is set at $48 million to $52 million by the end of 2017.
“During the second quarter, we realized an additional $2.8 million of merger-related cost synergies, primarily within cost of sales, and have refined our estimate of total annualized merger-related cost savings to $48 million to $52 million by the end of 2017.”