Builders FirstSource acquires West Orange Lumber
Dallas-based Builders FirstSource has purchased West Orange Lumber Company. The deal closed on July 31, 2014. West Orange was represented by The JIAN Group of Fredericksburg, Virginia.
Groveland, Florida-based West Orange supplies lumber, roof and floor trusses, custom windows and doors, as well as installation services, to residential home builders and commercial contractors in the Central Florida region. Sales were about $15 million for fiscal 2013.
"The acquisition of West Orange provides us with an extensive customer base that includes custom and semi-custom builders, along with commercial contractors, and fits nicely within our overall growth strategy,” said Floyd Sherman, Builders FirstSource CEO. “This new location also offers onsite manufacturing capabilities of roof and floor trusses, and will allow us to more easily serve the fast growing, northern portion of the Orlando market, providing us with an excellent opportunity to significantly grow our share in this market."
John Arellano, VP of West Orange Lumber, will remain as the general manager of the operation.
Plum Creek announces strong Q2 results
Plum Creek Timber reported second-quarter earnings of $55 million, up 20% from $46 million in the year-ago period. Revenues totaled $356 million, up 17% from revenues of $303 million in the second quarter of 2013.
Earnings for the first six months of 2014 were $85 million, down 17% from $102 million in the same period in 2013. Revenues for the first six months were $673 million, up 5% from $643 million.
“Our second-quarter results were much as we anticipated despite lower-than-planned harvest volumes in the South,” said Rick Holley, Plum Creek’s CEO. “So far this year, the operating income and cash flow from our timber resources segments are up nearly 30% due to improving log prices and the additional harvest from the lands we acquired in December.
“Our Real Estate segment continues to perform as expected and our Manufacturing segment is on track to deliver a strong performance in 2014. Our Energy and Natural Resources segment results have grown too, as the assets we acquired over the past year are providing attractive cash-on-cash returns for our shareholders.”
The company has revised its earnings outlook for 2014 to reflect lower harvest volumes, expectations for slower log price growth and the anticipated composition of real estate transactions in the second half of the year. The company now expects 2014 income to be between $1.05 and $1.25 per share, and third quarter income between $0.27 and $0.32 per share.
Builders FirstSource swings to profit
Builders FirstSource achieved its highest sales level since 2006 as it swung to a profit in the second quarter ended June 30.
The Dallas-based pro dealer reported sales of $426.5 million, up 7.1% from the same quarter last year. Net income was $10.6 million, compared to a net loss of $48 million in the first quarter last year.
“We were able to achieve this high level of sales even though sales were reduced by commodity deflation this quarter, said Floyd Sherman, CEO. He pointed to an average drop of 8.8% drop in market prices for lumber and lumber sheet goods in the quarter.
Gross margin percentage was 22.0 percent, up from 20.7 percent last year. Gross margin percentage increased primarily due to improved customer pricing versus the second quarter of 2013.
The growth also came against a backdrop of disappointing residential construction statistics, he said.
Builders First Source acquired Houston-based Slone Lumber in the second quarter. “Evaluating attractive acquisition opportunities such as Slone will continue to be a key strategy of the company,” Sherman said.
The company operates 54 units and 48 manufacturing facilities in 9 states.