California home builder has big plans
A residential builder based in Southern California has gone on a buying spree in California, closing 13 land deals that represent 1,300 housing units, according to an article in the San Diego Union.
City Ventures, which is based in Santa Ana, Calif., told the newspaper that the latest acquisitions are part of an 18-month plan to strengthen the company’s presence in "California’s rapidly recovering housing economy."
A spokesman for the company, which has several active building projects in San Diego, said the firm is less than two years old, adding: "We don’t suffer from legacy loans or legacy projects.”
Singapore investor bolsters EcoBlu Products
EcoBlu Products Inc., maker of wood products treated with environmentally friendly protective coatings, received a financial boost from a Singapore-based investment company.
The Vista, Calif.-based supplier entered an investment agreement with Manhattan Resources Limited this week. A $5 million payment was part of the deal.
"This strategic financing has helped us recapitalize our balance sheet while providing us with the growth capital we need," said EcoBlu President and CEO Steve Conboy.
EcoBlu’s over-the-counter stock — ECOB.OB — was trading for $0.09 per share early Thursday.
On Feb. 15, 2010, the company received payment of $5 million for 81 million of its common shares pursuant to the Investment Agreement. After Manhattan receives shareholder approvals, an additional $5 million in the form of a revolving credit line will be made available for use by the company. The revolving credit line will bear interest at 6% per annum. Concurrently with the creation of the revolving line of credit, Manhattan will receive 50 million five-year warrants to purchase common shares of the company at an exercise price per share of $0.10.
Prior to entering into these agreements, Manhattan acquired approximately $1.2 million of outstanding convertible notes and associated warrants issued by the company in early 2010. Steve Conboy, CEO of ECOB, stated, "We are pleased to announce that the notes totaling approximately $1.2 million will be paid in full with the proceeds from the initial investment. In addition, the Series A through G Warrants issued March 26, 2010, for a total of 26.25 million shares have already been cancelled.
"We are pleased with the opportunity to invest in Ecoblu and share in the belief that their technology will set the standard for the industry," said Soo Ching Ho, CEO of Manhattan Resources Limited. "We are confident of the growth prospects of the company amid the recovery of the U.S. economy."
BlueLinx shows modest revenue growth
Fourth-quarter revenues at BlueLinx Holdings increased 0.5% to $367.9 million from $366.1 million for the same period a year ago.
The increase reflects a 7.4% increase in specialty product sales and a 9.5% decrease in structural product sales. Still, the company swung to a fourth-quarter loss of $20.2 million, compared with net income of $12.0 million in last year’s fourth quarter.
"BlueLinx’s fourth-quarter operational performance was impacted by the continuing difficult conditions of the housing and construction markets, as the recovery slowed down and we experienced the normal seasonal slowdown associated with our fourth quarter," said BlueLinx president and CEO George Judd. "In the face of this challenging operating environment, our financial results demonstrate modest revenue growth, strong gross margin performance and diligent cost management. We generated approximately $18 million in cash from operations during the quarter."
Overall unit volume declined 4.3%, with a 5.9% increase in specialty unit volume being offset by a 16.5% decline in structural unit volume.
For the full year ended Jan. 1, the Atlanta-based building products distributor posted net sales of $1.804 billion, up 9.6% from 2009. The company’s full-year loss narrowed to $53.2 million, compared with a loss of $61.5 million a year ago.
"While this difficult economic period continues, we remain focused on the strategic initiatives that will build a stronger, more profitable company. During the quarter we grew specialty revenue, a key strategic focus for BlueLinx, to 59% of our total revenues driven by a 5.9% increase in specialty unit volume," Judd added.