84 Lumber's sales shrank 36% last year to $1.35 billion, a spokesman for the company confirmed today. While steep, the decline isn't all that unusual for many of nation's biggest building material dealers.
The revenue drop was first reported today by the Pittsburgh Post-Gazette. Jeff Nobers, 84's vice president of marketing and public relations, confirmed to ProSales the accuracy of those numbers in a telephone conversation this afternoon.
Even with the decline in 2009 from 2008's sales total of $2.1 billion, 84 could hold onto fourth place in the ProSales 100 rankings this May. That's because Stock Building Supply, No. 2 on last year's list, went into Chapter 11 bankruptcy last year and emerged as a company likely to take in roughly $1 billion a year, down from 2008's $3.2 billion. ProBuild is likely to remain atop the list despite shrinking 27% in 2009 to $3.2 billion from 2008's $4.4 billion, while No. 3 ABC Supply has a chance to move to No. 2. But instead of moving up to third, 84 looks set to get leapfrogged by No. 5 Beacon Roofing Supply, which had roughly $1.63 billion in sales during 2009. And the No. 6 dealer, BMC Select--formerly Building Materials Holding Corp.--won't gain a spot, because it also went through Chapter 11 last year and is now roughly a $1 billion company.
As with other dealers, Nobers cited the decline in demand for new housing as a big reason for the decline. The Post-Gazette said 95% of 84 Lumber's business comes from new housing construction, which makes 84 more heavily dependent on that market segment than most other dealers.
84 operates 300 stories nationwide, down from the 319 it ran in 2008 and more than 400 it had the year before. "We feel we are positioned properly and have the right stores in the right locations," Nobers told the Pittsburgh newspaper. But that doesn't necessarily mean a sharp turnaround in 2010, he suggested.
"We are looking at 2011 before we get back to what is normal," Nobers told the Post-Gazette. "But the signs are positive."
