BlueLinx swings to profit in Q2
BlueLinx’s intitiative to deleverage the company, announced about a year ago, delivered the kind of the results the company had hoped for in the second quarter. The Atlanta-based building products distributor delivered the best second quarter since 2008, in terms of net income.
Net income swung to a positive $3.2 million, compared to a loss of $3.1 million in the same quarter last year.
Net sales declined to $474.0 million for the second quarter of fiscal 2017, compared to $509.0 million from the prior fiscal second quarter. But gross profit increased to $60.5 million during the fiscal second quarter, up $3.2 million from the prior fiscal second quarter.
Profits increased even as the company experienced pressure on commodity lumber prices during the period, the Atlanta-based company said.
[See the company press release here.]
“We continue to make progress in our local market and sales excellence emphasis, which coupled with our ongoing deleveraging efforts, enabled us to improve our financial performance while significantly reducing our debt from prior year levels,” said Mitch Lewis, president and CEO. “As we remain focused on our customers and markets, our team is energized and motivated to continue improving our operating results and garnering market share,”
In March of 2017, BlueLinx completed the sale of a non-operating facility in Allentown, Pennsylvania, as well as two sales-and-leaseback deals in Fort Worth, Texas and Miami, Florida.
Throwback Thursday: A Diamond in the rough
An article in the Sept. 7, 1987 issue of National Home Center News, the forerunner of HBSDealer, described the comeback attempt of Diamond Lumber, a Carrollton, Texas-based lumberyard chain that had filed for Chapter 11 bankruptcy protection a few months earlier.
Hopes were running high, as the company was seeking to improve vendor relations while luring back its core contractor customer.
Said President Jerald Grubstein: “We’re turning things around.”
A key player in the turnaround effort was Jim Schaffer, a former senior VP of merchandising at Moores, a division of Grossmans. He was described in the 1987 article as “an easy-going man with a ready grin.” Today, Schaffer is the principal of Schaffer Associates, an executive search firm specializing in the hardware and building supply industry.
In an e-mail to HBSDealer, Schaffer described Diamond's challenge, some of its successes, and its ultimate dissolution. He writes:
“When I joined Diamond Lumber, they were in Chapter 11 bankruptcy after prior management tried to convert traditional contractor yards built along railroad rights-of-way and in industrial settings to retail outlets competing for DIY dollars. And of course, in 1987 there were a few new retail operations just gaining traction in the DIY market – big boxes being built in prime locations.
“Well, we gave it a shot. We worked to turn Diamond back to the builder and in some cases we were successful. In others, they told us that we had abandoned them once, and they weren’t going to take the risk again. In any event, we built the business back to a profit, but unfortunately we had to sell off assets to pay our creditors — which we did. And that’s why many of the Diamond yards now fly other banners.”
One group that continues to survive and thrive, he said, is Diamond Pacific Lumber in Northern California, owned and operated by Pacific Coast Building Products.
Schaffer adds: “I had the chance to visit there two years ago and, just like the picture from 1987, it was truly a walk down memory lane.”
# # #
Last week, Throwback Thursday featured an article about the 100th anniversary of Long-Lewis Hardware. Subsequently, this article appeared in Alabama.com, regarding the conversion of the distributor’s old headquarters into an office complex.
McCoy’s buys a new approach to reload
McCoy’s Building Supply, the 86-unit Texas-based lumberyard company, announced today that it recently purchased the former C-R Reload Center, Inc. located in Burnet, Texas. Terms of the deal were not released.
C-R Reload had provided reload and lumber storage services for McCoy’s and other Central Texas customers since 2002. Under McCoy’s ownership the facility will operate as MC Reload with a focus on reducing costs and adding distribution efficiencies to McCoy’s Building Supply stores and their customers throughout a large part of McCoy’s network of Texas stores. The facility will also provide reload and storage services to third-party users.
“This new operation is an important step in our future that substantially improves McCoy’s effectiveness in serving our stores and our customers,” said Brian McCoy, President and CEO. Planning and design work to increase both the rail and storage capacity of the additional property has begun in anticipation of growth for both McCoy’s distribution and MC Reload services.
The purchase includes the existing seven acre rail-served facility with rail capacity for 14 center beam rail cars, as well as the acquisition of an additional 30 acres which will be developed to substantially increase the facility’s distribution and reload capacity. McCoy’s has increased its truck fleet to improve delivery efficiencies to each of their store locations served by the distribution facility.
The facility is served by Austin Western Railroad with rail access to the BNSF and Union Pacific Railroads.
McCoy’s is based in San Marcos, Texas, and was founded in 1917. In 2009, the company was named HBSDealer Pro Dealer of the Year during the ProDealer Industry Summit.