Builders FirstSource (BFS) increased its bet on the Texas market today with the announcement it has purchased Empire Truss Ltd. of Huntsville. It's the fifth acquisition that Dallas-based BFS has made in 2014, and four of them involved companies in the Lone Star State.
Empire makes roof and floor trusses and also distributes engineered wood products, Its primary operation is about 65 miles north of Houston, a market where the No. 6 company on the ProSales 100 didn't have much of a presence until earlier this year. Empire also has a 30,000-square-foot manufacturing facility in Ferris, Texas, 20 miles southeast of Dallas.
The company focuses on multifamily housing--an area that BFS says it is emphasizing--and light commercial work. Sales in fiscal 2014 will total about $11 million, BFS says.
"The acquisition of Empire provides us a well-respected truss business with operations serving the Texas markets," BFS president and chief operating officer Chad Crow said in a statement. "This transaction also gives us the ability to leverage the contributions of other recent Texas acquisitions, by providing complementary product offerings, additional manufacturing capacity and a more diversified customer base."
Earlier this year, BFS acquired Sloan Lumber in Houston; Truss Rite in Dallas; and Trim Tech of Austin, Texas; and West Orange Lumber near Orlando, Fla. On a trailing 12-month basis as of their respective acquisition dates, these companies had generated combined revenue of approximately $67 million, BFS said. And earlier this month, the company opened a new location in Conroe, Texas, and related its San Antonio facility.
"When you look at the acquisitions that we made with the truss manufacturing companies, those companies will enable us to become more involved with the multifamily sector of the business," CEO Floyd Sherman said in a conference call Oct. 24 to present to analysts the company's third-quarter results. "That’s where the primary focus is on. We think the multifamily business will continue to be very good. It looks like the multifamily construction over next several years will be more robust than single-family. These operations will certainly allow us to gain better penetration into that particular market and in the areas where we acquired the plans. And so we look at that strategically as being very, very important to this company to get into more involved in a multifamily."
BFS recorded $1.49 billion in sales in all of 2013. Through the first nine months of this year, sales have totaled $1.21 billion, 7.7% ahead of last year's pace. Even more notable, net income totaled $15.7 million for the first nine months of this year versus a $47.2 million net loss in the same three quarters of 2013.
Empire Truss co-founder Casey Collum will continue to run the operation after it becomes part of BFS. Danny McQuary of Note Orius served as Empire's financial adviser on the deal, which closed Dec. 22.