Boise Cascade experienced positive growth in both its net sales and net income in the fiscal first quarter of 2020, according to the company’s earnings report. Net income grew 7% on a year over year (YOY) basis to $12.2 million, while net sales grew 12% YOY to $1.2 billion. The company’s first quarter results include $15.0 million of pretax accelerated depreciation and $1.7 million of other curtailment related costs due to Boise Cascade’s permanent curtailment of I-joist production at its Roxboro, N.C., facility.
Boise Cascade’s wood product sales, including building materials distribution, increased $0.5 million YOY to $320.1 million in the first quarter of 2020. The increase was driven primarily by higher sales volumes for I-joists and LVL, partially offset by decreases in sales prices and sales volumes for plywood. Income for the wood product segment decreased $7.9 million from the first quarter of 2019 to $3.8 million, primarily due to accelerated depreciation and closure-related costs at Boise Cascade’s Roxboro, N.C., facility.
Building materials distribution sales grew 16% YOY to $1.05 billion during the first quarter of 2020. The increase in sales was driven by a sales volume increase of 17%, which was partially offset by a sales price decrease of 1%. Commodity sales increased 11% YOY, general line product sales increased 23% YOY, and sales of engineered wood products increased 14% YOY. Income in the building materials distribution segment increased $11.8 million YOY to $29.3 million. The growth in the segment’s income was driven by a gross margin increase of $24.6 million, resulting from improved gross margins on commodity products and higher sales of general line products and engineered wood products, according to Boise Cascade.
“As we respond to the impacts and uncertainties of COVID-19, our focus remains on the health and safety of our associates, followed by business continuity. At the same time, we are fortunate to have entered 2020 in a sound financial position,” Boise Cascade CEO Nate Jorgensen said in a news release. “Our first quarter financial results were strong in both businesses, demonstrating the strength of our integrated business model. We will continue to take the necessary steps to preserve our financial position and effectively support our customers, and ultimately will strive to balance the priorities of the various stakeholders that depend on us.”
In response to the impacts of the coronavirus, Boise Cascade has reduced its planned spending capital for 2020 to $50 million to $70 million, which is down from $85 million to $95 million. The completion of a log utilization center improvement project at Boise Cascade’s plywood and veneer facility in Florien, La., and a door shop expansion in Dallas, Texas, are still included in the company’s 2020 capital spending.
Boise, Idaho-based Boise Cascade produces engineered wood products and plywood in North American and is a wholesale distributor of building products.
