Sales rise nearly 32% at BFS
Revenues jumped 31.7% at Builders FirstSource, the Dallas-based pro dealer, which posted net sales of $279.1 million for the second quarter of 2012, up from sales of $206.4 million in the same quarter of 2011. Net loss for the quarter, which ended June 30, was $12 million, compared with $15.4 million in 2011.
Sales from lumber and sheet goods showed the greatest gains during the quarter at 32.4%, followed by windows and doors at 21.8%. Prefabricated components rose by 18.8% and millwork by 9.7%. Most of the growth in sales was from an increase in sales volume, according to the company.
CEO Floyd Sherman said in a prepared statement: “Our topline growth far exceeded the increase in residential construction activity, and we met our primary goal for the quarter of getting back to positive EBITDA.”
Sherman added, “The broad-based housing recovery that began in the latter half of 2011 continues, though moderately paced. At the same time, however, we are seeing meaningful improvements in our financial results as we continue to grow market share, leverage our strong competitive position, and provide first-class customer service.”
Headquartered in Dallas, Texas, Builders FirstSource is a leading supplier and manufacturer of structural and related building products for residential new construction. The company operates 53 distribution centers and 44 manufacturing facilities in 9 states, principally in the southern and eastern United States.
Existing-home prices rise in June but sales drop
Numbers released today by the National Association of Realtors (NAR) showed continued gains in-existing home prices but a slower market for sales. Completed transactions that include single-family homes, townhomes, condominiums and co-ops declined 5.4% in June compared with May. In year-over-year figures, June 2012 was 4.5% higher than June 2011.
The national median existing-home price for all housing types was $189,400 in June, up 7.9% from a year ago. This marks four back-to-back monthly price increases from a year earlier, which last occurred in February to May of 2006. June’s gain was the strongest since February 2006 when the median price rose 8.7% from a year prior.
NAR chief economist Lawrence Yun said the bigger story is lower inventory and the recovery in home prices. "Despite the frictions related to obtaining mortgages, buyer interest remains solid. But inventory continues to shrink and that is limiting buying opportunities. This, in turn, is pushing up home prices in many markets," Yun said. "The price improvement also results from fewer distressed homes in the sales mix."
Distressed homes — foreclosures and short sales sold at deep discounts — accounted for 25% of June sales (13% were foreclosures and 12% were short sales), unchanged from May but down from 30% from June 2011. Foreclosures sold for an average discount of 18% below market value in June, while short sales were discounted 15%. "The distressed portion of the market will further diminish because the number of seriously delinquent mortgages has been falling," said Yun.
Myrick joins Florida dealer
Bill Myrick, the former CEO of ProBuild and chief operating officer of 84 Lumber, has been hired as CEO of American Builders Supply (ABS), a leading supplier of doors, windows, millwork and trusses to home builders in Florida. ABS, which is owned by Blue Wolf Capital Partners, has five Florida locations and has consolidated four leading independent competitors in the last 15 months.
In an interview with Home Channel News, Myrick said he “looked at several opportunities” during his one-year hiatus after officially leaving ProBuild on July 12, 2011. He chose ABS because of the company’s growth plans.
“Our goal is to offer more [products] and grow the footprint,” Myrick said. “We just added lumber at one location, and others will follow.” The company has recently begun component manufacturing, another area where Myrick sees potential.
Myrick said he was also attracted by ABS’s size. “I like working for a smaller firm where I can get to know the [staff] and the customers,” said Myrick, who oversaw the nation’s largest pro dealer at his last job.
Chad Barton, chairman of ABS, said, "Bill is a well-respected executive in our industry, and we are looking forward to working with him. His experience and business relationships will prove invaluable as we continue to grow in our core markets in Florida and as we expand into new end markets and geographic territories. Bill will enhance our ability to provide our full suite of products to both existing and new customers."
ABS services customers throughout North and Central Florida from its Sanford headquarters (outside of Orlando) and from three additional manufacturing and distribution facilities located in Winter Haven, Melbourne and Jacksonville. Through its Melbourne and Sanford facilities, ABS also offers custom doors and molding products for specialty home builders and retail customers.
Although Florida’s home-building industry is starting to rebound, Myrick will face plenty of competition in his markets from former employers and rivals. ProBuild is there, as is 84 Lumber and Builders FirstSource. Florida also has a number of strong independent lumberyards and specialty dealers. But for now, Myrick said, “I love this industry and I’m glad to be back.”