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.
Builders FirstSource posts strong Q2
Builders FirstSource CEO Floyd Sherman likes what he sees when he looks at the new residential housing market. He also described himself as bullish on his company’s ability to convert housing market growth to sales growth.
The Dallas-based pro dealer reported net sales of $1.8 billion in the quarter ended June 30. That’s up 9.9% from the same quarter last year. Net income swelled to $37.9 million, up from $29.4 million in the year-ago quarter.
“We are increasingly leveraging our national scale, geographic and end market exposure, customer reach, service advantage, and value-added product portfolio to continue to grow our revenue and operating profit,” Sherman said.
Excluding closed locations, sales grew 10.1% in the first half of the year, Sherman said. Also, sales to the single-family construction end market grew 7.4%. Repair and remodeling end market sales increased 5.1%. He pointed to major investments in manufacturing capacity and talent.
Other metrics from the company’s second quarter earnings release:
- Gross margin of $460.8 million increased by $43.5 million over the second quarter of 2016.
- Gross margin percentage of 25.0%, up from 24.9%;
- Year to date net sales of $3.4 billion, up 9.8% over the same period in the previous year.
Builders FirstSource, which acquired ProBuild Holdings in August 2015 to form an LBM super power operating in 40 states, had $6.4 billion in sales last year.
BMC sales growth hits double digits
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.”