BlueLinx drives profits in Q3
Building products distributor BlueLinx reported that third quarter sales jumped more than 28% to $871 million from sales of $679 million in the third quarter 2019.
The Marietta, Ga.-based company also reported a net income of $55 million for the quarter, marking a big swing from a net loss of $7 million in the prior third quarter.
BlueLinx said that the economic impact of the COVID-19 pandemic was offset by the improving housing market and rapid escalation in wood-based commodity prices.
Net sales during the quarter benefitted from historic price inflation across key wood-based commodities during the period, primarily impacting net sales of structural products.
The impact of wood-based commodity price inflation on structural product net sales is estimated to have increased overall net sales between $105 million and $115 million for the quarter, BlueLinx said.
Third quarter net sales of structural products, which includes products such as lumber, plywood, oriented strand board, rebar, and remesh, were $375 million, while net sales for specialty products, which includes products such as engineered wood, cedar, molding, siding, metal products and insulation, accounted for $496 million in the period.
The Bottom Line: BlueLinx swings to a net income of $55 million as record-high lumber prices help drive a sales increase of more than 28%.
What the CEO said: “This was a transformative quarter for BlueLinx as we took advantage of our operational improvements over the last year to maximize our financial performance,” said Mitch Lewis, president and CEO. “Although the COVID-19 pandemic continued to affect our business and the broader economy, we drove significant increases in net sales as well as historical levels of net income and Adjusted EBITDA by closely managing an improving housing market and an unprecedented inflationary environment in our wood-based structural product markets."
Company info: The full third quarter report from BlueLinx is available here.