Building products distributor BlueLinx posted strong fourth quarter results, significantly growing net sales and turning a profit during the quarter. For the full 2020 fiscal year, BlueLinx reported an increase in sales and a significant growth in net income, according to the company’s quarterly earnings report.
Net sales in the fourth quarter increased 41% on a year-over-year (YOY) basis to $865 million. Quarterly sales for specialty products, which includes products such as engineered wood, cedar, molding, siding, metal products, and insulation, accounted for $498 million of net sales during the period, according to BlueLinx. Net sales of structural products, including lumber, plywood, oriented strand board, rebar, and remesh, were $367 million. BlueLinx said the impact of wood-based commodity price inflation is estimated to have increased structural product net sales by approximately $105 to $115 million for the quarter. The distributor reported a gross profit of $124 million in the fourth quarter, compared to $83 million in the prior year period.
For the full fiscal year, net sales increased 17% to $3.1 billion in 2020. BlueLinx also posted $478 of gross profit for the full fiscal year in 2020, compared to $357 million in the prior year period. The distributor said wood-based commodity price inflation in the second half of the year is estimated to have increased net sales by approximately $210 to $230 million for the full year.
“The fourth quarter was a fantastic conclusion to a historic year for BlueLinx, one where improved execution, pricing discipline, effective inventory management, and market tailwinds resulted in record financial performance for the company and significant debt reduction,” president and CEO Mitch Lewis said in a prepared statement. “We again recorded significant increases in net sales along with strong margins as current market conditions remain favorable, supported by strong demand for new residential construction and increased home renovation activity.”
In the fourth quarter, BlueLinx reported net income of $20 million, compared to a net loss of $10 million in the prior-year period. The company’s fourth-quarter adjusted EBITDA was $39 million, a $28 million increase from the fourth quarter in 2019.
For the full fiscal year, BlueLinx reported net income of $81 million, compared to a net loss of $18 million in the 2019 fiscal year. Adjusted EBITDA for the full fiscal year was $170 million, an increase of $99 million compared to the $71 million for the full fiscal year in 2019.
“Supply-demand imbalances within the commodity wood markets have continued to persist into the first quarter of 2021, resulting in elevated prices for commodity lumber and panels,” Lewis said. “While higher commodity wood prices have benefited our business over the near-term, we capitalized on initiatives to enhance margins and profitability while taking preemptive actions to mitigate potential downside commodity price risk. As supply conditions normalize, we anticipate commodity wood prices reverting back toward long-term market averages.”
Marietta, Ga.-based BlueLinx has a distribution footprint serving 40 states and the company distributes its range of structural and specialty products to approximately 15,00 customers across the United States.
