O’Meara stays on as BFS consultant
Kevin O’Meara, who resigned as president and COO of Builders FirstSource on Oct. 29, has agreed to serve as a consultant to the company for a two-year period, according to a filing with the Securities and Exchange Commission. In exchange, O’Meara will receive 89,334 shares of restricted stock, which will vest at the end of the two-year period.
The Builders FirstSource co-founder has also agreed not to work for a Builders FirstSource competitor, solicit business from any of the company’s customers or attempt to hire any Builder FirstSource employees for the next two years.
O’Meara’s separation agreement, outlined in the SEC document, will pay the 10-year company veteran $810,000, equal to two years of his base salary, in 52 installments. He is also entitled to receive $500,203, the average of his bonuses for the last two years, in June 2008.
In other company news, Builders FirstSource has entered into a new $350 million revolving credit facility with Wachovia Capital Markets and UBS Investment Bank. General Electric Capital will also participate in the lending consortium.
“We believe this credit facility further enhances our liquidity and will enable us to better manage our business through the difficult housing environment. Our current borrowing capacity under the agreement is approximately $150 million, which coupled with our cash on hand, provides over $250 million of liquidity,” said Floyd Sherman, the company’s CEO.
The $350 million revolving credit line will be available for working capital and general corporate purposes.
Headquartered in Dallas, Builders FirstSource is a lumber and building materials distributor with locations in 13 states, principally in the southern and eastern United States.
Snap-on names new CEO
Kenosha, Wis.-based Snap-on has named president and COO Nicholas Pinchuk to the post of CEO, replacing Jack Michaels.
Pinchuk, 61, will continue to serve as president, while Michaels, 70, will remain chairman of the board, the company said.
“Nick’s leadership as COO reaffirms that he will guide the corporation’s continued success,” said Michaels.
Pinchuk has been with the company since 2002 and was named president and COO in April.
Snap-on is a global manufacturer and marketer of tools, diagnostics and equipment for professional users.
Pier 1 narrows losses in third quarter
Specialty retailer Pier 1 Imports greatly narrowed its losses in the third quarter to $9.96 million, an improvement over $72.72 million in losses in the same quarter last year.
Sales fell 7 percent to $374.2 million compared with $402.7 million in the same period last year.
Pier 1’s new president and CEO Alex Smith said the narrower losses resulted from a greater emphasis on sustainable margins and lower ticket impulse items in stores.
“We are pleased with our third-quarter margin results, which would have been higher had it not been for the clearance of our Pier 1 Kids merchandise,” Smith noted.
The retailer saw cost savings to the tune of $21.2 million on marketing expenses, $10.8 million in payroll savings and $5.4 million in savings on other general administrative costs.
Smith further said the retailer saw improvements in conversion rates and units per transaction, as well as in total transaction value.
“This is only the beginning; we still have a lot of work to do,” he said. “However, the fact that we achieved these results with less than perfect execution gives me great optimism about our ability to return to profitability and beyond.”