Builders' FirstSource posted a net loss of $8.8 million in income Thursday evening for the 3rd quarter of 2015, or a loss of $0.08 per share. BFS also posted a sales increase of almost 200% to $1.3 billion, up from $435 million in the year ago period. Cost of sales also increased up $614 million to $951 million, compared to $337 million in the year ago period.
The reason for the loss in income despite posting solid sales numbers is the $46 million in net interest expense. This is up from $6.4 million in net interest expense from the year ago period. This large increase was primarily related to the financing transactions associated with the acquisition of ProBuild.
BFS also supplied Pro Forma numbers in anticipation of its acquisition of ProBuild, estimating a Pro Forma diluted adjusted net income per share of $0.31, compared to Pro Forma diluted adjusted net income of $0.14 per share in the year ago period. Pro Forma net sales were around $1.7 billion, holding steady compared to the Pro Forma net sales of $1.7 billion in the year ago period.
|Pro Forma |
|Pro Forma |
|(in millions except per share amounts)|
|Net Sales||$ 1,276.1||$ 422.9||$ --||$ 1,699.0|
|Cost of Sales||951.3||304.2||3.0||1,258.5|
|Selling, general and administrative||284.7||109.6||(18.8)||375.5|
|Facility closure costs||1.9||--||(0.5)||1.4|
|Total operating expenses||286.6||109.6||(19.3)||376.9|
|Income from operations||38.2||9.1||16.3||63.6|
|Interest expense, net||46.0||3.2||(6.0)||43.2|
|Income (loss) from continuing operations before income tax||(7.8)||5.9||22.3||20.4|
|Income tax expense||1.0||0.2||--||1.2|
|Income (loss) from continuing operations||(8.8)||5.7||22.3||19.2|
|Loss from discontinued operations||--||--||--||--|
|Net income (loss)||$ (8.8)||$ 5.7||$ 22.3||$ 19.2|
"We ended the third quarter of 2015 with pro forma sales of $1.7 billion, flat to prior year excluding the impact of closed lo," cations," said BFS CEO Floyd Sherman. "but grew adjusted EBITDA by 19 percent or $18 million. We were able to achieve these positive results despite the negative impact of commodity deflation on our current quarter sales."
"Since the closing of the ProBuild acquisition on July 31, I am even more confident that this acquisition will drive significant value for our customers and stockholders," said Sherman. "We have solidified a clear roadmap to deliver cost savings, and have already implemented changes that are expected to yield over $30 million of the projected $100-120 million of annualized cost savings. We believe these cost savings will begin to benefit our fourth quarter results."
BFS already has plans to close 19 locations where it overlaps with ProBuild.