BlueLinx Announces First Quarter 2025 Results

BlueLinx Holdings Inc. (NYSE:BXC), a leading U.S. wholesale distributor of building products, today reported financial results for the three fiscal months ended March 29, 2025.

FIRST QUARTER 2025 HIGHLIGHTS

• Net sales of $709 million
• Gross profit of $111 million, gross margin of 15.7% and specialty product gross margin of 18.7%
• Net income of $2.8 million, or $0.33 diluted earnings per share
• Adjusted net income of $2.3 million, or $0.27 adjusted diluted earnings per share
• Adjusted EBITDA of $19.6 million, or 2.8% of net sales
• Available liquidity of $795 million, including $449 million cash and cash equivalents on hand
• $15 million in share repurchases, with $31 million remaining on the share repurchase authorization as of quarter-end

"Our first quarter results demonstrated our continued ability to drive profitable sales, despite challenging weather and market conditions," said Shyam Reddy, President, and CEO of BlueLinx. "We are pleased with maintaining solid margins in both specialty products and structural products during the quarter. While current market conditions remain uncertain, we are well-positioned to benefit from an industry recovery given our strong balance sheet, ample liquidity and our continued success executing our long-term profitable sales growth strategy. In addition, we once again returned capital to shareholders by repurchasing $15 million worth of our shares in the quarter. At the end of March, we had $31 million remaining on our share repurchase authorization and remain committed to repurchasing shares opportunistically under this authorization."

FIRST QUARTER 2025 FINANCIAL PERFORMANCE

In the first quarter of 2025, net sales were $709 million, a decrease of $17 million, or 2% when compared to the first quarter of 2024. Gross profit was $111 million, a decrease of $17 million, or 13%, year-over-year, and gross margin was 15.7%, down 190 basis points from the same period last year.

Net sales of specialty products, which includes products such as engineered wood, siding, millwork, outdoor living, specialty lumber and panels, and industrial products, were $479 million, a decrease of $24 million, or 4.9% when compared to the first quarter of 2024. This decrease in net sales for specialty products in the current fiscal quarter was due to price deflation driven by external market conditions, as well as lower volumes for most categories of specialty products. Gross profit from specialty product sales was $90 million, a decrease of $14 million, or 13.7% when compared to the first quarter of last year. Gross margin for specialty products was 18.7% compared to 20.7% in the prior year quarter, a decline of 200 basis points. The current period included a benefit of $2.4 million, and the prior-period quarter included a net benefit of $6.5 million, for import duty-related items. Excluding these benefits, gross margin was 18.2% and 19.4% for first quarter 2025 and first quarter 2024, respectively, a decline of 120 basis points. The duty items were related to changes in retroactive rates for anti-dumping duties and to classification adjustments for certain goods imported by the Company.

Net sales of structural products, which includes products such as lumber, panels (including plywood and oriented strand board), rebar, and remesh, increased $7.4 million, or 3.3% when compared to the first quarter of 2024, to $230 million in the first quarter of 2025. The increase in structural sales was due to overall increases in lumber pricing, and increased lumber and panel volumes, partially offset by price declines in panels. Gross profit from sales of structural products was $21.4 million, a decrease of $2.3 million from the prior year period, and gross margin was 9.3%, compared to 10.6% in the prior year period. Increased pricing in the current quarter was offset by higher costs of product sold in the current quarter.

Excluding the duty-related items for specialty products, which benefited first quarter 2025 and first quarter 2024, totaling $2.4 million and $6.5 million, respectively, Company gross margin would have been 15.3% and 16.7%, respectively.

Selling, general and administrative ("SG&A") expenses were $94 million in the first quarter of 2025, $2.8 million higher than the prior year period. The year-over-year change in SG&A was primarily due to continuing technology initiatives associated with our digital transformation and also to higher logistics costs.

Net income was $2.8 million, or $0.33 per diluted share, versus $17.5 million, or $2.00 per diluted share, in the prior year period. Adjusted Net Income was $2.3 million, or $0.27 per diluted share compared to $18.8 million, or $2.14 per diluted share in the first quarter of last year.

Adjusted EBITDA was $19.6 million, or 2.8% of net sales, for the first quarter of 2025, compared to $38.8 million, or 5.3% of net sales in the first quarter of 2024. The current and prior quarterly periods include the benefit of the aforementioned duty-related matters, and not including these items, Adjusted EBITDA would have been $17.1 million, or 2.4% of net sales for first quarter 2025, and $32.3 million, or 4.5% of net sales, in the first quarter of 2024.

Net cash used in operating activities was $(34) million in the first quarter of 2025 and free cash flow was $(40) million. Our first fiscal quarter typically has negative cash flows from operations due to seasonality.

CAPITAL ALLOCATION AND FINANCIAL POSITION

During the first quarter 2025, we invested $6.4 million in property and equipment, primarily for improvements to our distribution facilities and for our digital transformation initiative. We also entered into new finance leases of $28 million, mainly to enhance our fleet. Additionally, we purchased approximately $15 million of the Company's common stock through open market transactions under our $100 million share repurchase program. At quarter-end, we had $31 million remaining under this authorization and we plan to continue to be opportunistic with respect to repurchasing shares.

As of March 29, 2025, total debt and finance lease obligations, but excluding real property finance lease obligations, was $374 million. This consisted of $300 million of senior secured notes that mature in 2029 and $74 million of finance lease obligations for equipment. Net debt was ($75) million, which consisted of total debt and finance leases excluding real property finance lease obligations of $374 million, less cash and cash equivalents of $449 million, resulting in a net leverage ratio of (0.7x) using a trailing twelve-month Adjusted EBITDA of $112 million. Available liquidity was $795 million which included an undrawn revolving credit facility that had $346 million of availability plus cash and cash equivalents of $449 million.

SECOND QUARTER 2025 OUTLOOK

Through the first four weeks of the second quarter of 2025, specialty product gross margin was in the range of 17% to 18% and structural product gross margin was in the range of 9% to 10%. Average daily sales volumes were improved versus both the first quarter of 2025 and the second quarter of 2024.

CONFERENCE CALL INFORMATION

BlueLinx will host a conference call on April 30, 2025, at 10:00 a.m. Eastern Time, accompanied by a supporting slide presentation.

A webcast of the conference call and accompanying presentation materials will be available in the Investor Relations section of the BlueLinx website at https://investors.bluelinxco.com, and a replay of the webcast will be available at the same site shortly after the webcast is complete.

To participate in the live teleconference:

Domestic Live: 1-888-660-6392

Passcode: 9140086

To listen to a replay of the teleconference, which will be available through May 7, 2025:

Domestic Replay: 1-800-770-2030

Passcode: 9140086

ABOUT BLUELINX

BlueLinx (NYSE:BXC) is a leading U.S. wholesale distributor of residential and commercial building products with both branded and private-label SKUs across product categories such as lumber, panels, engineered wood, siding, millwork, and industrial products. With a strong market position, broad geographic coverage footprint servicing 50 states, and the strength of a locally focused sales force, we distribute a comprehensive range of products to our customers which include national home centers, pro dealers, cooperatives, specialty distributors, regional and local dealers and industrial manufacturers. BlueLinx provides a wide range of value-added services and solutions to our customers and suppliers, and we operate our business through a broad network of distribution centers. To learn more about BlueLinx, please visit www.bluelinxco.com.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements. Forward-looking statements include, without limitation, any statement that predicts, forecasts, indicates or implies future results, performance, liquidity levels or achievements, and may contain the words "believe," "anticipate," "could," "expect," "estimate," "intend," "may," "project," "plan," "should," "will," "will be," "will likely continue," "will likely result," "would," or words or phrases of similar meaning.

The forward-looking statements in this press release include statements about our strategy, liquidity, and debt, our long-run positioning relative to industry conditions, future share repurchases, and the information set forth under the heading "Second Quarter 2025 Outlook".

Forward-looking statements in this press release are based on estimates and assumptions made by our management that, although believed by us to be reasonable, are inherently uncertain. Forward-looking statements involve risks and uncertainties that may cause our business, strategy, or actual results to differ materially from the forward-looking statements. These risks and uncertainties include those discussed in greater detail in our filings with the Securities and Exchange Commission. We operate in a changing environment in which new risks can emerge from time to time. It is not possible for management to predict all of these risks, nor can it assess the extent to which any factor, or a combination of factors, may cause our business, strategy, or actual results to differ materially from those contained in forward-looking statements. Factors that may cause these differences include, among other things: adverse housing market conditions; consolidation among competitors, suppliers, and customers; escalating changes in retaliatory trade policies of the United States and other countries; our dependence on international suppliers and manufacturers for certain products and related exposure to risks of new or increased tariffs and other risks that could affect our financial condition; disintermediation risk; pricing and product cost variability; volumes of product sold; competition; the cyclical nature of the industry in which we operate; loss of products or key suppliers and manufacturers; information technology security risks and business interruption risks; effective inventory management relative to our sales volume or the prices of the products we produce; the ability to attract, train, and retain highly qualified associates and other key personnel while controlling related labor costs; potential acquisitions and the integration and completion of such acquisitions; business disruptions; exposure to product liability and other claims and legal proceedings related to our business and the products we distribute; natural disasters, catastrophes, fire, wars or other unexpected events; the impacts of climate change; successful implementation of our strategy; wage increases or work stoppages by our union employees; costs imposed by federal, state, local, and other regulations; compliance costs associated with federal, state, and local environmental protection laws; the effects of epidemics, global pandemics or other widespread public health crises and governmental rules and regulations; fluctuations in our operating results; our level of indebtedness and our ability to incur additional debt to fund future needs; the covenants of the instruments governing our indebtedness limiting the discretion of our management in operating the business; the potential to incur more debt; the fact that we have consummated certain sale leaseback transactions with resulting long-term non-cancelable leases, many of which are or will be finance leases; the fact that we lease many of our distribution centers, and we would still be obligated under these leases even if we close a leased distribution center; inability to raise funds necessary to finance a required repurchase of our senior secured notes; a lowering or withdrawal of debt ratings; changes in our product mix; increases in fuel and other energy prices or availability of third-part freight providers; changes in insurance-related deductible/retention liabilities based on actual loss development experience; the possibility that the value of our deferred tax assets could become impaired; changes in our expected annual effective tax rate could be volatile; the costs and liabilities related to our participation in multi-employer pension plans could increase; the risk that our cash flows and capital resources may be insufficient to service our existing or future indebtedness; interest rate risk, which could cause our debt service obligations to increase; and changes in, or interpretation of, accounting principles.

Given these risks and uncertainties, we caution you not to place undue reliance on forward-looking statements. We expressly disclaim any obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

NON-GAAP MEASURES AND SUPPLEMENTAL FINANCIAL INFORMATION

The Company reports its financial results in accordance with GAAP. The Company also believes that presentation of certain non-GAAP measures may be useful to investors and may provide a more complete understanding of the factors and trends affecting the business than using reported GAAP results alone. Any non-GAAP measures used herein are reconciled to their most directly comparable GAAP measures herein in the "Reconciliation of Non-GAAP Measurements" table later in this release. The Company cautions that non-GAAP measures are not intended to present superior measures of our financial condition from those measures determined under GAAP and should be considered in addition to, but not as a substitute for, the Company's reported GAAP results. The Company further cautions that its non-GAAP measures, as used herein, are not necessarily comparable to other similarly titled measures of other companies due to differences in methods of calculation.

Adjusted EBITDA and Adjusted EBITDA Margin. BlueLinx defines Adjusted EBITDA as an amount equal to net income (loss) plus interest expense and all interest expense related items, income taxes, depreciation and amortization, and further adjusted for certain non-cash items and other special items, including expenses from share-based compensation, one-time charges associated with the legal, consulting, and professional fees related to our merger and acquisition activities, gains or losses on sales of properties, amortization of deferred gains on real estate, and expense associated with our restructuring activities, such as severance, in addition to other significant and/or one-time, nonrecurring, non-operating items.

The Company presents Adjusted EBITDA because it is a primary measure used by management to evaluate operating performance. Management believes this metric helps to enhance investors' overall understanding of the financial performance and cash flows of the business. Management also believes Adjusted EBITDA is helpful in highlighting operating trends. Adjusted EBITDA is frequently used by securities analysts, investors, and other interested parties in their evaluation of companies, many of which present an Adjusted EBITDA measure when reporting their results.

We determine our Adjusted EBITDA Margin, which we sometimes refer to as our Adjusted EBITDA as a percentage of net sales, by dividing our Adjusted EBITDA for the applicable period by our net sales for the applicable period. We believe that this ratio is useful to investors because it more clearly defines the quality of earnings and operational efficiency of translating sales to profitability.

Adjusted Net Income and Adjusted Earnings Per Share. BlueLinx defines Adjusted Net Income as Net Income adjusted for certain non-cash items and other special items, including expenses from share-based compensation, one-time charges associated with the legal, consulting, and professional fees related to our merger and acquisition activities, gains or losses on sales of properties, amortization of deferred gains on real estate, and expense associated with our restructuring activities, such as severance, in addition to other significant and/or one-time, nonrecurring, non-operating items, further adjusted for the tax impacts of such reconciling items. BlueLinx defines Adjusted Earnings Per Share (basic and/or diluted) as the Adjusted Net Income for the period divided by the weighted average outstanding shares (basic and/or diluted) for the periods presented. We believe that Adjusted Net Income and Adjusted Earnings Per Share (basic and/or diluted) are useful to investors to enhance investors' overall understanding of the financial performance of the business. Management also believes Adjusted Net Income and Adjusted Earnings Per Share (basic and/or diluted) are helpful in highlighting operating trends.

Our Adjusted Net Income and Adjusted Earnings Per Share (basic and/or diluted) are not presentations made in accordance with GAAP and are not intended to present superior measures of our financial condition from those measures determined under GAAP. Adjusted Net Income and Adjusted Earnings Per Share (basic or diluted), as used herein, are not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation. These non-GAAP measures are reconciled in the "Reconciliation of Non-GAAP Measurements" table later in this release.

Free Cash Flow. BlueLinx defines free cash flow as net cash provided by, or used in, operating activities less total capital expenditures. Free cash flow is a measure used by management to assess our financial performance, and we believe it is useful for investors because it relates the operating cash flow of the Company to the capital that is spent to continue and improve business operations. In particular, free cash flow indicates the amount of cash generated or used after capital expenditures that can be used for, among other things, investment in our business, strengthening our balance sheet, and repayment of our debt obligations. Free cash flow does not represent the residual cash flow available for discretionary expenditures since there may be other nondiscretionary expenditures that are not deducted from the measure. Free cash flow is not a presentation made in accordance with GAAP and is not intended to present a superior measure of financial condition from those determined under GAAP. Free cash flow, as used herein, is not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation. This non-GAAP measure is reconciled in the "Reconciliation of Non-GAAP Measurements" table later in this release.

Net Debt, Net Debt Excluding Real Property Finance Lease Liabilities, Overall Net Leverage Ratio, and Net Leverage Ratio Excluding Real Property Finance Lease Liabilities. BlueLinx calculates Net Debt as its total short- and long-term debt, including outstanding balances under our term loan and revolving credit facility and the total amount of its obligations under finance leases, less cash and cash equivalents. Net Debt Excluding Real Property Finance Lease Liabilities is calculated in the same manner as Net Debt, except the total amount of obligations under real estate finance leases are excluded. Although our credit agreements do not contain leverage covenants, a net leverage ratio excluding finance lease obligations for real property is included within the terms of our revolving credit agreement. We believe that Net Debt and Net Debt Excluding Real Property Finance Lease Liabilities are useful to investors because our management reviews both metrics as part of its management of overall liquidity, financial flexibility, capital structure and leverage, and creditors and credit analysts monitor our net debt as part of their assessments of our business. We determine our Overall Net Leverage Ratio by dividing our Net Debt by Twelve-Month Trailing Adjusted EBITDA. Our calculation of Net Leverage Ratio Excluding Real Property Finance Lease Liabilities is determined by dividing our Net Debt Excluding Real Property Finance Lease Liabilities by Twelve-Month Trailing Adjusted EBITDA. We believe that these ratios are useful to investors because they are indicators of our ability to meet our future financial obligations. In addition, our Net Leverage Ratio is a measure that is frequently used by investors and creditors. Our Net Debt, Net Debt Excluding Real Property Finance Lease Liabilities, Overall Net Leverage Ratio, and Net Leverage Ratio Excluding Real Property Finance Lease Liabilities are not made in accordance with GAAP and are not intended to present a superior measure of our financial condition from measures and ratios determined under GAAP. The calculations of our Net Debt, Net Debt Excluding Real Property Finance Lease Liabilities, Overall Net Leverage Ratio, and Net Leverage Ratio Excluding Real Property Finance Lease Liabilities are presented in a subsequent table. Net Debt, Net Debt Excluding Real Property Finance Lease Liabilities, Overall Net Leverage Ratio, and Net Leverage Ratio Excluding Real Property Finance Lease Liabilities, as used herein, are not necessarily comparable to other similarly titled captions of other companies due to differences in methods of calculation.

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Tom Morabito

Investor Relations Officer

(470) 394-0099

[email protected]