NYSE to drop BMHC
Building Materials Holding Corp. (BMHC), the San Francisco-based pro dealer, will be dropped from the New York Stock Exchange (NYSE) listing for failing to meet minimum market capitalization standards. Trading of the BLG stock will be suspended on Oct. 29, according to the NYSE announcement. The NYSE also noted that the company’s average share price has, on previous occasions, fallen below the NYSE’s standard of not less than $1.00 for 30 consecutive days.
In a statement issued after the NYSE announcement, BMHC said it will move the trading of its common stock to the OTC Bulletin Board, or OTCBB, an electronic, regulated quotation service that displays real-time quotes, last-sale prices and volume information for over-the-counter equity securities not listed on national securities exchanges. Companies listed on the OTCBB are still subject to SEC filing requirements and other regulatory authority.
“We remain dedicated to achieving continued improvement in our financial results through the significant operational restructuring we have undertaken,” said Robert Mellor, BMHC’s chairman and CEO. “We expect a number of market participants to make a market in our stock in the OTC system and that our investors will be able to continue trading BMHC shares.”
The company also said it would announce further details of its planned move to OTC trading prior to Oct. 29.
Stock cuts 86 locations
Stock Building Supply will close 86 facilities and reduce head count by some 3,000 associates, the Raleigh, N.C.-based division of Wolseley announced today.
Stock will exit 16 markets in six states, its parent company said. The company did not give specific locations.
The restructuring is a result of the declining housing market and followed Wolseley’s “fundamental review” of the business that was announced in September. Citing “unprecedented conditions in the global financial markets,” the U.K.-based corporation indicated that it was unable to find a buyer for Stock. Wolseley said it also considered closing down the entire U.S. building materials division.
The 86 branches represent 25 percent of Stock’s revenue and 28 percent of its head count, according to Wolseley. The closures will leave Stock with 209 locations in 27 states.
In a statement released this morning, Stock president Joe Appelmann said: “These are very painful decisions that affect loyal associates and their families. Without a doubt, we are facing unprecedented times in our industry. There is over capacity in an industry that was geared up to supply 2.3 million new housing starts two years ago; today the number is less than 1 million. The realities of the current market have changed the capacity of our industry and necessitated these actions.”
The specific facility closings will be announced later, along with the associated cost savings, according to the company.
Earlier this month, Wolseley reported annual revenues for Stock were $3.47 billion, down 24.5 percent from $4.59 billion in 2007. This reflects a 21 percent decline in same-store sales. Stock’s $246 million loss for fiscal 2008 compares to a profit of $86 million in fiscal 2007. This year’s loss includes $13 million in restructuring and severance costs. As of July 31, 2008, Stock had 285 branches, compared to 308 locations in 2007.
In an interview with Appelmann that appeared in the Feb. 11 issue of Home Channel News, the president maintained an optimistic view — “This is the ninth housing market downturn since World War II,” he told HCN. “There will be a tenth.”
Appelmann said the new size and footprint of the company is based on markets that will “bring us out of the downturn more quickly than others.”
“This is not just about cutting losses. If that were so, you wouldn’t see our commitment to markets such as Florida where our current losses are hurting us. Florida, for example, has great potential for rebounding, and we will be there to take advantage of the upswing.”
Chip Hornsby, Wolseley’s CEO, echoed these comments in an analyst conference call following today’s announcement. Stock will keep branches open in states like Florida and California regardless of the plunge in housing starts, he said, adding: “When the market does return, we will be well positioned [in these markets] to benefit as soon as possible.”
Lowe’s partners with Coinstar
Coinstar, the maker and operator of spare-change counting machines, has announced a deal with Lowe’s. Customers using Coinstar machines at 50,000 supermarkets and other locations can trade their spare change for a Lowe’s “eCertificate,” usable online and at Lowe’s stores.
According to Coinstar, the value of the average change jar can add up to a range of purchases at Lowe’s:
• 12 oz. jar — Kobalt 20-Piece Screwdriver Set ($19.98)
• 16 oz. jar — Valspar 1-Gal. Signature Colors Interior Paint ($29.98)
• 32 oz. jar — Harbor Breeze Bella Vista Ceiling Fan ($49)
• 1 gal. jar — BBQ Grillware Charcoal Grill ($199)