What is now BMC Select racked up $18.8 million in losses in December, its final month in Chapter 11, the company reported in a bankruptcy court filing in late January. That brings to just under $50 million the total losses that the former Building Materials Holding Corp. (BMHC) incurred during the six months it used to reorganize and re-emerge in January as a new LBM business. That $50 million also is the amount of tax benefits that the company expected to reap as a result of a change in tax laws.
America's sixth-biggest LBM operation reported $41 million in sales across its 12 business units, but it also incurred a $15.7 million loss on operations. More than half of that operating loss--$8.6 million--represented income expenses, while the rest was a loss on regular operations. Its net loss includes $3.4 million in reorganization-related payments to attorneys and others.
As of Dec. 31, BMHC had $61.2 million in accounts receivable, roughly one-quarter less than the $82.6 million in ARs it held on Nov. 30. Of that $61.2 million, just under $7.5 million, or 12.2% was more than 90 days past due. That's down sharply from the 24.4% in the 90+ days account one month before.
The report doesn't reflect the tax benefits that what is now BMC Select expected to reap as a result of a change in tax law enacted last year regarding how a company can apply current losses to profits in previous years. The previous limit on Net Operating Loss (NOL) carrybacks, as the prevision is known, was two years. The change pushed it to five. As a result, the former BMHC has said in bankruptcy court filings, it had estimated it would be able to realize about $50 million in tax refunds. December's reported losses appear to make that possible.
The report also excludes the $23 million in tax refunds that BMHC had said it expected to gain as a result of its successful sale by Dec. 31 of its C Construction unit (better known as Ontario Framing, which operates in Southern California) and the winding down of its SelectBuild Illinois unit.
BMHC was the No. 6 dealer on last year's ProSales 100, with total sales in 2008 of $1.3 billion. During a Jan. 21 interview with ProSales, BMC Select CEO Paul Street said he expects the company's revenues will fall below $1 billion this year. BMC Select isn't turning a profit now, but it should be by December, he said.
BMC Select serves 16 markets in 11 states, all of which--except for North Carolina and Texas--stretch from Colorado to the Pacific coast. As of the end of 2008, the company said it had 8,200 employees. In its Jan. 4 announcement declaring itself out of Chapter 11, BMC Select said it employs more than 3,700 people.