Huttig Building Products Inc. slashed its net loss in the second quarter to $2.3 million from $6 million in the year-earlier period, thanks in part to an 11.7% rise in sales from continuing operations to $113.9 million, the St. Louis-based distributor and millwork giant reported today.

Millwork sales rose 22% to total $61.7 million and wood products sales climbed 35% from the April-June 2009 period to reach $14.8 million, but building product sales slipped 2% to $57.4 million. The gross margin inched up to 18.4% of sales from 18%, primarily because of wider margins on certain commodity building materials. Operating expenses grew by $300,000 to $26.5 million, but they accounted for 19.8% of sales in the second quarter vs. 21.9% of sales a year ago.

"While we expect the severe downturn in new residential construction to continue to adversely affect our operating results in 2010, the decline in annualized housing starts appears to have leveled off in the past several quarters," Huttig said in its SEC filing. "Further, total housing starts actually increased in the first half of 2010 as compared to 2009, though future starts could be negatively impacted by the expiration of the home buyer tax credit on April 30."

Millwork operations accounted for 46% of sales in the second quarter, up from 42% a year before, while general building products' share dropped to 43% from a year-earlier 49% and sales of wood products figured in 11% of total revenues, up from 9%.

There were notable changes in the company's long-term debt. It has risen from $32.2 million as of June 30, 2009, to $34.8 million at the end of last year to $52.5 million as of the end of this June. Huttig said it believes it has enough cash from continuing operations plus extra funds available under its credit facility (which totals $120 million) for it to meet its short-term, long-term and capital expenditure needs.

Huttig operations through 27 distribution centers serving 41 states. It has closed 20 distribution centers since mid-2006 and has cut its workforce by about 1,200 workers, to a current head count of roughly 1,000.