DALLAS, TX -- Builders FirstSource, Inc., a leading supplier and manufacturer of structural and related building products for residential new construction in the United States, reported a net loss of $15.5 in its second quarter, on sales of $206.4 million.
"We are very encouraged by our second quarter results, as our near break-even Adjusted EBITDA was our best operating performance since the third quarter of 2007," said Floyd Sherman, Builders FirstSource Chief Executive Officer. "We finished the current quarter with sales of $206.4 million, down just 2.4 percent compared to sales of $211.5 million in the second quarter of 2010. While U.S. single-family housing starts and average commodity prices were down 13.1 percent and 20.8 percent, respectively, over this same time period, our sales volume was up slightly, which we believe is indicative of significant market share gains during the quarter."
Commenting on the current quarter results, Chad Crow, Builders FirstSource Senior Vice President and Chief Financial Officer, added, "Our gross margin percentage was 20.7%, up 2.4 percentage points from 18.3% in the second quarter of 2010. The primary drivers of our margin increase were improved pricing on sales of our manufactured products during the quarter, coupled with less volatility in the commodity markets. We also achieved further cost reductions for the quarter, as selling, general and administrative expenses decreased $2.5 million, or 4.8 percent, compared to the second quarter of 2010." Continuing, he added, "We ended the quarter with $112.0 million in liquidity, down only $3.4 million from the previous quarter. The $112.0 million in liquidity included $63.1 million in available cash and approximately $48.9 in borrowing availability under our revolving credit facility. Cash used in the current quarter was approximately $14.5 million. Of this $14.5 million, $5.3 million was due to an increase in working capital and $1.1 million related to capital expenditures. The remaining $8.1 million was used to fund interest and operating losses, and is a $6.0 million improvement over the $14.1 million of cash used to fund interest and operating losses in the second quarter of 2010."
Mr. Sherman added, "Despite our improved results, challenges still persist in the housing industry, as the seasonally adjusted annual rate for U.S. single-family housing starts in June 2011 was 453,000, which was basically flat when compared to June 2010. However, for the current quarter actual U.S. single-family housing starts were down 13.1 percent, as compared to the second quarter of 2010. We also saw a similar level of decline in actual U.S. single-family units under construction during the quarter, as they decreased 16.7 percent from the second quarter of 2010. In the South Region, as defined by the U.S. Census Bureau, and which includes all of our markets, we saw similar trends as actual single-family housing starts were 63,700, down 13.1 percent, and single-family units under construction were 116,600, down 14.5 percent compared to the second quarter of 2010."