Boise Cascade reported strong net sales growth and a significant year-over-year (YOY) increase in net income in the fiscal third quarter. Net sales rose 25% YOY to $1.6 billion during the quarter while net income rose from $27.2 million in the third quarter of 2019 to $103.2 million in the third quarter of 2020, according to the company’s quarterly earnings report.
“Extraordinary market conditions, along with great execution by both of our businesses, helped us deliver outstanding results in the third quarter,” CEO Nate Jorgensen said in a prepared statement. “We look to the future with optimism, as our balance sheet provides us with the flexibility to pursue organic and acquisition growth opportunities in support of our customers and suppliers.”
Boise Cascade’s wood product sales, including sales to building materials distribution, increased 12% on a YOY basis to $363.7 million during the third quarter. The increase in sales was driven primarily by higher plywood prices and higher sales volumes for I-joists, according to Boise Cascade. These increases were partially offset by lower sales volumes for plywood and laminated veneer lumber (LVL), as well as decreased net sales prices for LVL and I-joists. Income for the wood products segment increased $50.4 million to $66.0 million during the third quarter, due primarily to higher plywood sales prices, according to Boise Cascade.
Building materials distribution sales increased 25% on a YOY basis to $1.4 billion during the third quarter, driven by primarily sales price increases of 25%, with relatively flat sales volumes. Commodity sales increased 54% YOY, general line product sales increased 6% YOY, and engineered wood product sales increased 6% YOY. Income for the segment increased $69.2 million on a YOY basis to $107.9 million. The increase in income was primarily attributable to improved gross margins on commodity products compared to the prior-year period, according to Boise Cascade.
The company said third quarter results included a $10.5 million after-tax loss on extinguishment of debt as Boise Cascade refinanced senior notes at a lower interest rate with an extended maturity. Results in the third quarter of 2019 included $1.0 million of after-tax losses from a non-cash pension settlement charge.
Boise Cascade previously announced its wood products segment implemented temporary curtailments and reduced operating schedules early in the second quarter due to uncertainty related to COVID-19. The company said the segment continues to make efforts to restore product to pre-COVID-19 levels in response to strong end-product demand. Boise Cascade said despite these efforts, the company continues to experience periodic short-term disruptions at many locations due to COVID-19 and activity levels across the company’s distribution network continue to vary widely due to the pandemic.
Boise, Idaho-based Boise Cascade products engineered wood products and plywood in North America and is a wholesale distributor of building products.
