BMHC pulls out from Florida
BMHC, the San Francisco-based pro dealer, has announced its decision to withdraw from the state of Florida due to the prolonged housing slump there. BMHC serves production builders in Florida through its SelectBuild division, which offers shell construction, concrete services, and truss and stair manufacturing.
Approximately 140 employees will be affected, according to BMHC. SelectBuild will fulfill all its contractual obligations as it closes down its operations over the next four months, the company said.
“The Florida market has weakened considerably, and we anticipate it will be some time before improvement is seen,” said Stanley Wilson, BMHC’s president and chief operating officer, in a prepared statement. He added that housing starts have dropped from a peak of 265,000 in 2005 to an estimated 61,000 in 2008.
SelectBuild operates from eight locations in Florida, according to BMHC’s 2008 annual report. It accounts for approximately 8 percent of BMHC’s annual revenues. There are no BMC West locations in Florida.
BMHC is currently in talks with its lenders regarding a failure to meet the covenants of its credit facility. Ranked 5th on the ProDealer Top 350 for 2007, BMHC’s sales dropped 28.7 percent last year, from $3.20 billion to $2.28 billion.
Net income drops 28 percent at Simpson
Simpson Manufacturing, maker of Simpson Strong-Tie and Simpson Dura-Vent products, saw net income drop 28 percent in the second quarter to $20.38 million from $28.3 million in the year-ago period. Sales were down 5 percent to $219.33 million from $231.3 million last year.
In the second quarter of 2008, sales declined throughout the United States, with the exception of the northeastern and midwestern regions of the country. California and the western states had the largest decrease in sales, the company said in a statement.
Those declines were in part offset by strong sales in Canada and mainland Europe, which “increased significantly.” Sales declined in the United Kingdom.
In the company’s Strong-Tie division, sales fell 4.9 percent, while Dura-Vent sales fell 10.2 percent. The company noted that while sales of its Dura-Vent’s pellet vent and chimney products increased, sales of gas vent and Direct-Vent product lines decreased.
Simpson Manufacturing is based in Pleasanton, Calif.
Builders FirstSource posts $46 million loss
Builders FirstSource reported a net loss of $45.9 million for the second quarter, which ended on June 30, 2008, swinging from net income of $8.4 million for the second quarter of 2007. The Dallas-based pro dealer posted $307.3 million in sales for its second quarter, a 34 percent decline from $465.1 million during the same period last year.
For the first six months of 2008, Builders FirstSource reported sales of $577.7 million, versus $876.2 million last year. The company lost $61.7 million during the first two quarters of the year. Last year, Builders FirstSource posted a profit of $8.6 million for the same period.
Commenting on the financial results, CEO Floyd Sherman said that housing starts in his company’s markets — primarily the eastern and southeastern United States — fell 43.1 percent in the second quarter of 2008 compared to the previous year. Builders FirstSource was able to offset the declines, he said, by gaining an estimated 8.2 percent of market share.
The company’s liquidity is “strong at over $210 million,” according to CFO Charles Horn.
In a prepared statement, the company said it “expects the difficult market conditions to negatively affect operating results throughout the remainder of 2008 and 2009.”