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July 28, 2016 6:05 AM EDT


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): July 28, 2016
BOISE CASCADE COMPANY
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction
of incorporation)
 
001-35805
(Commission
File Number)
 
20-1496201
(IRS Employer
Identification No.)
1111 West Jefferson Street, Suite 300
Boise, Idaho 83702-5389
(Address of principal executive offices) (Zip Code)
(208) 384-6161
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
 
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
 
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
 
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





Item 2.02 Results of Operations and Financial Condition.
On July 28, 2016, we issued an earnings release announcing our second quarter 2016 financial results, a copy of which is furnished as Exhibit 99.1 to this Current Report on Form 8-K. Additionally, Exhibit 99.2, a copy of which is furnished, includes certain statistical information relative to our quarterly performance.
We have reconciled the non-GAAP financial measures to our reported financial performance in the financial notes that accompany our earnings release.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are furnished as part of this Report on Form 8-K:
Exhibit
 
Description
 
 
 
Exhibit 99.1
 
Boise Cascade Company Earnings Release dated July 28, 2016.
 
 
 
Exhibit 99.2
 
Boise Cascade Company Quarterly Statistical Information for second quarter 2016.






SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
BOISE CASCADE COMPANY
 
 
 
 
By
/s/ John T. Sahlberg
 
 
John T. Sahlberg
Senior Vice President, Human Resources and General Counsel
Date: July 28, 2016
 
 






Boise Cascade
 
Exhibit 99.1
 
1111 West Jefferson Street Ste 300 PO Box 50 Boise, ID 83728
 
 
 
News Release
Investor Relations Contact - Wayne Rancourt
208 384 6073
 
Media Contact - John Sahlberg
208 384 6451

For Immediate Release: July 28, 2016

Boise Cascade Company Reports 2016 Second Quarter Net Income of
$19.2 Million on Sales of $1,043.8 Million

BOISE, Idaho - Boise Cascade Company (Boise Cascade or Company) (NYSE: BCC) today reported net income of $19.2 million, or $0.49 per share, on sales of $1,043.8 million for the second quarter ended June 30, 2016.

Second Quarter 2016 Highlights
 
2Q 2016
 
2Q 2015
 
% change
 
 
 
 
 
 
 
(thousands, except per-share data and percentages)
 
 
 
 
 
 
Consolidated Results
 
 
 
 
 
Sales
$
1,043,773

 
$
955,397

 
9
 %
Net income
19,228

 
20,230

 
(5
)%
Net income per common share - diluted
0.49

 
0.51

 
(4
)%
EBITDA1
56,447

 
50,681

 
11
 %
 
 
 
 
 
 
Segment Results
 
 
 
 
 
Wood Products sales
$
346,358

 
$
339,869

 
2
 %
Wood Products income
16,309

 
23,712

 
(31
)%
Wood Products EBITDA1
31,078

 
34,053

 
(9
)%
 
 
 
 
 
 
Building Materials Distribution sales
850,042

 
762,078

 
12
 %
Building Materials Distribution income
29,117

 
19,576

 
49
 %
Building Materials Distribution EBITDA1
32,471

 
22,450

 
45
 %
 
 
 
 
 
 
Corporate loss
(7,531
)
 
(5,888
)
 
(28
)%
Corporate EBITDA1
(7,102
)
 
(5,822
)
 
(22
)%
1 For reconciliations of non-GAAP measures, see summary notes at the end of this press release.

In second quarter 2016, total and single-family U.S. housing starts increased approximately 1% and 7%, respectively, from the same period last year. Total U.S. housing starts from the July 2016 Blue Chip consensus forecast for 2016 and 2017 reflect 1.20 million and 1.32 million, respectively, or expected annual increases of 8% and 10%.



“The integration of the Thorsby and Roxboro engineered wood products facilities has gone very well. We are pleased with the additional capabilities the facilities provide as we support the ongoing growth of our customers," stated Tom Corrick, CEO. "Our distribution business had an outstanding second quarter that reflected solid volume growth across its product lines and the benefit of favorable tailwinds on many commodity product prices. We still face oversupply challenges in our plywood business, but did see improvement in pricing compared to the first quarter. We expect modest growth in residential housing construction for the balance of the year, which should drive additional demand for our products and services."

Wood Products

Sales, including sales to Building Materials Distribution (BMD), increased $6.5 million, or 2%, to $346.4 million for the three months ended June 30, 2016, from $339.9 million for the three months ended June 30, 2015. The increase in sales was driven primarily by increases in sales volumes and prices of laminated veneer lumber and I-joists (collectively EWP). The EWP volume increases were due primarily to our acquisition of two EWP facilities on March 31, 2016. These increases were offset partially by decreases in plywood and lumber sales volumes and prices.

Wood Products segment income decreased $7.4 million to $16.3 million for the three months ended June 30, 2016, from $23.7 million for the three months ended June 30, 2015. The decline in income was due primarily to lower plywood and lumber sales prices, as well as higher oriented strand board (OSB) costs used in the manufacture of I-joists. In addition, depreciation and amortization expense increased $4.4 million due to the acquisition of two EWP facilities on March 31, 2016, and other capital expenditures. These decreases were offset partially by improved sales volumes and prices of EWP.

Comparative average net selling prices and sales volume changes for plywood, EWP, and lumber are as follows:

 
 
2Q 2016 vs. 2Q 2015
 
2Q 2016 vs. 1Q 2016
 
 
 
 
 
 Average Net Selling Prices
 
 
 
 
    Plywood
 
(10)%
 
4%
    LVL
 
2%
 
—%
    I-joists
 
3%
 
—%
Lumber
 
(4)%
 
3%
 Sales Volumes
 
 
 
 
    Plywood
 
(8)%
 
—%
    LVL
 
33%
 
30%
    I-joists
 
14%
 
29%
Lumber
 
(12)%
 
3%

Building Materials Distribution

Sales increased $88.0 million, or 12%, to $850.0 million for the three months ended June 30, 2016, from $762.1 million for the three months ended June 30, 2015. Compared with the same quarter in the prior year, the overall increase in sales was driven by sales volume increases of 13%, offset partially by a decrease in sales prices of 1%. By product line, commodity sales increased 12%, general line product sales increased 10%, and sales of EWP (substantially all of which are sourced through our Wood Products segment) increased 13%.

BMD segment income increased $9.5 million to $29.1 million for the three months ended June 30, 2016, from $19.6 million for the three months ended June 30, 2015. The increase in income was driven primarily by a higher gross margin of $18.8 million, including an improvement in gross margin percentage of 100 basis points, which was largely driven by favorable trending prices in OSB and lumber during second quarter 2016, as well as stronger margin contribution within our general line products. These increases were offset partially by increased

2

selling and distribution expenses and general and administrative expenses of $7.7 million and $1.0 million, respectively.

Corporate and Other

Segment loss was $7.5 million for the three months ended June 30, 2016, compared with $5.9 million for the three months ended June 30, 2015. The change was due primarily to higher incentive compensation costs.

Balance Sheet

Boise Cascade ended the second quarter with $96.1 million of cash and cash equivalents and $319.1 million of undrawn committed bank line availability, for total available liquidity of $415.2 million. The Company reported $464.6 million of outstanding debt at June 30, 2016.

Outlook

The Company expects its capital expenditures during 2016 to be $85-$95 million, inclusive of costs associated with the newly acquired EWP facilities.

As in recent years, we expect to continue to experience modest demand growth for the products we manufacture and distribute in 2016, and we remain optimistic that the overall improvement in demand for our products will continue as household formation rates and residential construction recover. Future commodity product pricing could be volatile in response to industry operating rates, net import and export activity, inventory levels in our distribution channels, and seasonal demand patterns. We expect to manage our production levels to our sales demand, which will likely result in operating some of our facilities below their capacity, and could also include temporary plant curtailments such as those recently taken in our plywood operations.
        
About Boise Cascade

Boise Cascade Company is one of the largest producers of plywood and engineered wood products in North America and a leading U.S. wholesale distributor of building products. For more information, please visit our website at www.bc.com.

Webcast and Conference Call

Boise Cascade will host a webcast and conference call on Thursday, July 28, at 11 a.m. Eastern, at which time we will review the Company's second quarter.

You can join the webcast through our website by going to www.bc.com and clicking on the Event Calendar link under the Investor Relations heading. Please go to the website at least 15 minutes before the start of the webcast to register. To join the conference call, dial 844-795-4410 (international callers should dial 661-378-9637), participant passcode 51270007, at least 10 minutes before the start of the call.

The archived webcast will be available in the Investor Relations section of our website. A replay of the conference call will be available from Thursday, July 28, at 2 p.m. Eastern through Thursday, August 4, at 2 p.m. Eastern. Replay numbers are 855-859-2056 for U.S. calls and 404-537-3406 for international calls, and the passcode will be 51270007.

Basis of Presentation

We refer to the term EBITDA in this earnings release as a supplemental measure of our performance and liquidity that is not required by or presented in accordance with generally accepted accounting principles in the United States ("GAAP"). We define EBITDA as income before interest (interest expense, interest income, and change in fair value of interest rate swaps), income taxes, and depreciation and amortization.


3

EBITDA is the primary measure used by our management to evaluate segment operating performance and to decide how to allocate resources to segments. We believe EBITDA is useful to investors because it provides a means to evaluate the operating performance of our segments and our Company on an ongoing basis using criteria that are used by our management and because it is frequently used by investors and other interested parties when comparing companies in our industry that have different financing and capital structures and/or tax rates. We believe EBITDA is a meaningful measure because it presents a transparent view of our recurring operating performance and allows management to readily view operating trends, perform analytical comparisons, and identify strategies to improve operating performance. EBITDA, however, is not a measure of our liquidity or financial performance under GAAP and should not be considered as an alternative to net income, income from operations, or any other performance measure derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity. The use of EBITDA instead of net income or segment income (loss) has limitations as an analytical tool, including the inability to determine profitability; the exclusion of interest expense, interest income, and associated significant cash requirements; and the exclusion of depreciation and amortization, which represent unavoidable operating costs. Management compensates for these limitations by relying on our GAAP results. Our measure of EBITDA is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation.

Forward-Looking Statements

This news release contains statements that are "forward looking" within the Private Securities Litigation Reform Act of 1995. These statements speak only as of the date of this press release. While they are based on the current expectations and beliefs of management, they are subject to a number of uncertainties and assumptions that could cause actual results to differ from the expectations expressed in this release.

4



Boise Cascade Company
Consolidated Statements of Operations
(unaudited, in thousands, except per-share data)
 
Three Months Ended
 
Six Months Ended
 
June 30
 
March 31,
2016
 
June 30
 
2016
 
2015
 
 
2016
 
2015
 
 
 
 
 
 
 
 
 
 
Sales
$
1,043,773

 
$
955,397

 
$
880,695

 
$
1,924,468

 
$
1,765,300

 
 
 
 
 
 
 
 
 
 
Costs and expenses
 
 
 
 
 
 
 
 
 
Materials, labor, and other operating expenses (excluding depreciation)
894,715

 
824,583

 
769,544

 
1,664,259

 
1,529,622

Depreciation and amortization
18,552

 
13,281

 
15,238

 
33,790

 
26,868

Selling and distribution expenses
76,855

 
68,254

 
68,041

 
144,896

 
130,134

General and administrative expenses
15,612

 
12,018

 
16,052

 
31,664

 
24,026

Other (income) expense, net
172

 
(98
)
 
(1,585
)
 
(1,413
)
 
(397
)
 
1,005,906

 
918,038

 
867,290

 
1,873,196

 
1,710,253

 
 
 
 
 
 
 
 
 
 
Income from operations
37,867

 
37,359

 
13,405

 
51,272

 
55,047

 
 
 
 
 
 
 
 
 
 
Foreign currency exchange gain (loss)
28

 
41

 
198

 
226

 
(66
)
Interest expense
(6,427
)
 
(5,591
)
 
(5,802
)
 
(12,229
)
 
(11,072
)
Interest income
27

 
58

 
149

 
176

 
148

Change in fair value of interest rate swaps
(1,532
)
 
—

 
(69
)
 
(1,601
)
 
—

 
(7,904
)
 
(5,492
)
 
(5,524
)
 
(13,428
)
 
(10,990
)
 
 
 
 
 
 
 
 
 
 
Income before income taxes
29,963

 
31,867

 
7,881

 
37,844

 
44,057

Income tax provision
(10,735
)
 
(11,637
)
 
(2,931
)
 
(13,666
)
 
(16,210
)
Net income
$
19,228

 
$
20,230

 
$
4,950

 
$
24,178

 
$
27,847

 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
  Basic
38,814

 
39,494

 
38,853

 
38,834

 
39,496

  Diluted
38,972

 
39,600

 
38,880

 
38,850

 
39,604

 
 
 
 
 
 
 
 
 
 
Net income per common share:
 
 
 
 
 
 
 
 
 
  Basic
$
0.50

 
$
0.51

 
$
0.13

 
$
0.62

 
$
0.71

  Diluted
$
0.49

 
$
0.51

 
$
0.13

 
$
0.62

 
$
0.70



5


Wood Products Segment
Statements of Operations
(unaudited, in thousands, except percentages)
 
Three Months Ended
 
Six Months Ended
 
June 30
 
March 31,
2016
 
June 30
 
2016
 
2015
 
 
2016
 
2015
 
 
 
 
 
 
 
 
 
 
Segment sales
$
346,358

 
$
339,869

 
$
303,457

 
$
649,815

 
$649,185
 
 
 
 
 
 
 
 
 
 
Costs and expenses
 
 
 

 
 

 
 

 
 

Materials, labor, and other operating expenses (excluding depreciation)
303,803

 
296,276

 
273,942

 
577,745

 
564,696

Depreciation and amortization
14,769

 
10,341

 
11,634

 
26,403

 
21,132

Selling and distribution expenses
8,108

 
7,030

 
7,375

 
15,483

 
13,705

General and administrative expenses
3,173

 
2,514

 
6,098

 
9,271

 
5,026

Other (income) expense, net
196

 
(4
)
 
(1,477
)
 
(1,281
)
 
18

 
330,049

 
316,157

 
297,572

 
627,621

 
604,577

 
 
 
 
 
 
 
 
 
 
Segment income
$
16,309

 
$
23,712

 
$
5,885

 
$
22,194

 
$
44,608

 
 
 
 
 
 
 
 
 
 
 
(percentage of sales)
 
 
 
 
 
 
 
 
 
 
Segment sales
100.0
%
 
100.0
 %
 
100.0
 %
 
100.0
 %
 
100.0
%
 
 
 
 
 
 
 
 
 
 
Costs and expenses
 
 
 
 
 
 
 
 
 
Materials, labor, and other operating expenses (excluding depreciation)
87.7
%
 
87.2
%
 
90.3
 %
 
88.9
 %
 
87.0
%
Depreciation and amortization
4.3
%
 
3.0
%
 
3.8
 %
 
4.1
 %
 
3.3
%
Selling and distribution expenses
2.3
%
 
2.1
%
 
2.4
 %
 
2.4
 %
 
2.1
%
General and administrative expenses
0.9
%
 
0.7
%
 
2.0
 %
 
1.4
 %
 
0.8
%
Other (income) expense, net
0.1
%
 
—
%
 
(0.5
)%
 
(0.2
)%
 
—
%
 
95.3
%
 
93.0
%
 
98.1
 %
 
96.6
 %
 
93.1
%
 
 
 
 
 
 
 
 
 
 
Segment income
4.7
%
 
7.0
%
 
1.9
 %
 
3.4
 %
 
6.9
%



6

Building Materials Distribution Segment
Statements of Operations
(unaudited, in thousands, except percentages)

 
Three Months Ended
 
Six Months Ended
 
June 30
 
March 31
 
June 30
 
2016
 
2015
 
2016
 
2016
 
2015
 
 
 
 
 
 
 
 
 
 
Segment sales
$
850,042

 
$
762,078

 
$
717,254

 
$
1,567,296

 
$
1,384,983

 
 
 
 
 
 
 
 
 
 
Costs and expenses
 
 
 
 
 
 
 
 
 
Materials, labor, and other operating expenses (excluding depreciation)
743,700

 
674,503

 
635,778

 
1,379,478

 
1,232,864

Depreciation and amortization
3,354

 
2,874

 
3,235

 
6,589

 
5,613

Selling and distribution expenses
68,574

 
60,910

 
60,502

 
129,076

 
115,560

General and administrative expenses
5,356

 
4,311

 
4,503

 
9,859

 
8,239

Other (income) expense, net
(59
)
 
(96
)
 
(137
)
 
(196
)
 
(215
)
 
820,925

 
742,502

 
703,881

 
1,524,806

 
1,362,061

 
 
 
 
 
 
 
 
 
 
Segment income
$
29,117

 
$
19,576

 
$
13,373

 
$
42,490

 
$
22,922

 
 
 
 
 
 
 
 
 
 
 
(percentage of sales)
 
 
 
 
 
 
 
 
 
 
Segment sales
100.0
 %
 
100.0
 %
 
100.0
 %
 
100.0
 %
 
100.0
 %
 
 
 
 
 
 
 
 
 
 
Costs and expenses
 
 
 
 
 
 
 
 
 
Materials, labor, and other operating expenses (excluding depreciation)
87.5
 %
 
88.5
 %
 
88.6
 %
 
88.0
 %
 
89.0
 %
Depreciation and amortization
0.4
 %
 
0.4
 %
 
0.5
 %
 
0.4
 %
 
0.4
 %
Selling and distribution expenses
8.1
 %
 
8.0
 %
 
8.4
 %
 
8.2
 %
 
8.3
 %
General and administrative expenses
0.6
 %
 
0.6
 %
 
0.6
 %
 
0.6
 %
 
0.6
 %
Other (income) expense, net
—
 %
 
—
 %
 
—
 %
 
—
 %
 
—
 %
 
96.6
 %
 
97.4
 %
 
98.1
 %
 
97.3
 %
 
98.3
 %
 
 
 
 
 
 
 
 
 
 
Segment income
3.4
 %
 
2.6
 %
 
1.9
 %
 
2.7
 %
 
1.7
 %



7

Segment Information
(unaudited, in thousands)
 
Three Months Ended
 
Six Months Ended
 
June 30
 
March 31,
2016
 
June 30
 
2016
 
2015
 
 
2016
 
2015
Segment sales
 
 
 
 
 
 
 
 
 
Wood Products
$
346,358

 
$
339,869

 
$
303,457

 
$
649,815

 
$
649,185

Building Materials Distribution
850,042

 
762,078

 
717,254

 
1,567,296

 
1,384,983

Corporate and Other
103

 
—

 
186

 
289

 
—

Intersegment eliminations
(152,730
)
 
(146,550
)
 
(140,202
)
 
(292,932
)
 
(268,868
)
 
$
1,043,773

 
$
955,397

 
$
880,695

 
$
1,924,468

 
$
1,765,300

 
 
 
 
 
 
 
 
 
 
Segment income (loss)
 
 
 
 
 
 
 
 
 
Wood Products
$
16,309

 
$
23,712

 
$
5,885

 
$
22,194

 
$
44,608

Building Materials Distribution
29,117

 
19,576

 
13,373

 
42,490

 
22,922

Corporate and Other
(7,531
)
 
(5,888
)
 
(5,655
)
 
(13,186
)
 
(12,549
)
 
37,895

 
37,400

 
13,603

 
51,498

 
54,981

 
 
 
 
 
 
 
 
 
 
Interest expense
(6,427
)
 
(5,591
)
 
(5,802
)
 
(12,229
)
 
(11,072
)
Interest income
27

 
58

 
149

 
176

 
148

Change in fair value of interest rate swaps
(1,532
)
 
—

 
(69
)
 
(1,601
)
 
—

Income before income taxes
$
29,963

 
$
31,867

 
$
7,881

 
$
37,844

 
$
44,057

 
 
 
 
 
 
 
 
 
 
EBITDA (a)
 
 
 
 
 
 
 
 
 
Wood Products
$
31,078

 
$
34,053

 
$
17,519

 
$
48,597

 
$
65,740

Building Materials Distribution
32,471

 
22,450

 
16,608

 
49,079

 
28,535

Corporate and Other
(7,102
)
 
(5,822
)
 
(5,286
)
 
(12,388
)
 
(12,426
)
 
$
56,447

 
$
50,681

 
$
28,841

 
$
85,288

 
$
81,849


See accompanying summary notes to consolidated financial statements and segment information.

8



Boise Cascade Company
Consolidated Balance Sheets
(unaudited, in thousands)
 
June 30,
2016
 
December 31,
2015
 
 
ASSETS
 
 
 
 
 
 
 
Current
 
 
 
Cash and cash equivalents
$
96,089

 
$
184,496

Receivables
 
 
 
Trade, less allowances of $1,121 and $1,734
278,704

 
187,138

Related parties
376

 
1,065

Other
7,388

 
10,861

Inventories
461,998

 
384,857

Prepaid expenses and other
10,755

 
17,153

Total current assets
855,310

 
785,570

 
 
 
 
Property and equipment, net
552,776

 
402,666

Timber deposits
12,246

 
15,848

Goodwill
55,433

 
21,823

Intangible assets, net
15,893

 
10,090

Other assets
11,830

 
12,609

Total assets
$
1,503,488

 
$
1,248,606



9

Boise Cascade Company
Consolidated Balance Sheets (continued)
(unaudited, in thousands, except per-share data)
 
June 30,
2016
 
December 31,
2015
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
 
 
 
 
Current
 
 
 
Accounts payable
 
 
 
Trade
$
247,740

 
$
159,029

Related parties
1,954

 
1,442

Accrued liabilities
 
 
 
Compensation and benefits
57,250

 
54,712

Interest payable
3,403

 
3,389

Other
50,786

 
40,078

Total current liabilities
361,133

 
258,650

 
 
 
 
Debt
 
 
 
Long-term debt
464,586

 
344,589

 
 
 
 
Other
 
 
 
Compensation and benefits
93,614

 
93,355

Other long-term liabilities
24,136

 
17,342

 
117,750

 
110,697

 
 
 
 
Commitments and contingent liabilities
 
 
 
 
 
 
 
Stockholders' equity
 
 
 
Preferred stock, $0.01 par value per share; 50,000 shares authorized, no shares issued and outstanding
—

 
—

Common stock, $0.01 par value per share; 300,000 shares authorized, 43,518 and 43,413 shares issued, respectively
435

 
434

Treasury Stock, 4,767 and 4,587 shares at cost, respectively
(126,343
)
 
(123,711
)
Additional paid-in capital
511,097

 
508,066

Accumulated other comprehensive loss
(92,244
)
 
(93,015
)
Retained earnings
267,074

 
242,896

Total stockholders' equity
560,019

 
534,670

Total liabilities and stockholders' equity
$
1,503,488

 
$
1,248,606



10

Boise Cascade Company
Consolidated Statements of Cash Flows
(unaudited, in thousands)
 
Six Months Ended
 
June 30
 
2016
 
2015
Cash provided by (used for) operations
 
 
 
Net income
$
24,178

 
$
27,847

Items in net income not using (providing) cash
 
 
 
Depreciation and amortization, including deferred financing costs and other
34,661

 
27,638

Stock-based compensation
3,866

 
2,898

Pension expense
1,212

 
2,881

Deferred income taxes
3,901

 
7,187

Change in fair value of interest rate swaps
1,601

 
—

Other
72

 
(622
)
Decrease (increase) in working capital, net of acquisitions
 
 
 
Receivables
(76,937
)
 
(61,885
)
Inventories
(59,304
)
 
(20,653
)
Prepaid expenses and other
(4,508
)
 
(3,375
)
Accounts payable and accrued liabilities
96,403

 
78,457

Pension contributions
(2,778
)
 
(53,203
)
Income taxes payable
18,696

 
14,499

Other
4,955

 
(1,954
)
Net cash provided by operations
46,018

 
19,715

 
 
 
 
Cash provided by (used for) investment
 
 
 
Expenditures for property and equipment
(35,101
)
 
(31,433
)
Acquisitions of businesses and facilities
(215,900
)
 
—

Proceeds from sales of assets and other
255

 
263

Net cash used for investment
(250,746
)
 
(31,170
)
 
 
 
 
Cash provided by (used for) financing
 
 
 
Borrowings of long-term debt, including revolving credit facility
352,700

 
50,000

Payments on revolving credit facility
(232,700
)
 
—

Treasury stock purchased
(2,632
)
 
(6,109
)
Financing costs
(543
)
 
(655
)
Tax withholding payments on stock-based awards
(383
)
 
(1,063
)
Other
(121
)
 
660

Net cash provided by financing
116,321

 
42,833

 
 
 
 
Net increase (decrease) in cash and cash equivalents
(88,407
)
 
31,378

 
 
 
 
Balance at beginning of the period
184,496

 
163,549

 
 
 
 
Balance at end of the period
$
96,089

 
$
194,927



11

Summary Notes to Consolidated Financial Statements and Segment Information
The Consolidated Statements of Operations, Segment Statements of Operations, Consolidated Balance Sheets, Consolidated Statements of Cash Flows, and Segment Information do not include all Notes to Consolidated Financial Statements and should be read in conjunction with the Company’s 2015 Form 10-K and the Company’s other filings with the Securities and Exchange Commission. Net income for all periods presented involved estimates and accruals.
(a)
EBITDA represents income before interest (interest expense, interest income, and change in fair value of interest rate swaps), income taxes, and depreciation and amortization. The following table reconciles net income to EBITDA for the three months ended June 30, 2016 and 2015, and March 31, 2016, and the six months ended June 30, 2016 and 2015:
 
Three Months Ended
 
Six Months Ended
 
June 30
 
March 31,
2016
 
June 30
 
2016
 
2015
 
 
2016
 
2015
 
 
 
 
 
 
 
 
 
 
 
(unaudited, in thousands)
 
 
 
 
 
 
 
 
 
 
Net income
$
19,228

 
$
20,230

 
$
4,950

 
$
24,178

 
$
27,847

Interest expense
6,427

 
5,591

 
5,802

 
12,229

 
11,072

Interest income
(27
)
 
(58
)
 
(149
)
 
(176
)
 
(148
)
Change in fair value of interest rate swaps
1,532

 
—

 
69

 
1,601

 
—

Income tax provision
10,735

 
11,637

 
2,931

 
13,666

 
16,210

Depreciation and amortization
18,552

 
13,281

 
15,238

 
33,790

 
26,868

EBITDA
$
56,447

 
$
50,681

 
$
28,841

 
$
85,288

 
$
81,849



12

The following table reconciles segment income (loss) to EBITDA for the three months ended June 30, 2016 and 2015, and March 31, 2016, and the six months ended June 30, 2016 and 2015:
 
Three Months Ended
 
Six Months Ended
 
June 30
 
March 31,
2016
 
June 30
 
2016
 
2015
 
 
2016
 
2015
 
 
 
 
 
 
 
 
 
 
 
(unaudited, in thousands)
Wood Products
 
 
 
 
 
 
 
 
 
Segment income
$
16,309

 
$
23,712

 
$
5,885

 
$
22,194

 
$
44,608

Depreciation and amortization
14,769

 
10,341

 
11,634

 
26,403

 
21,132

EBITDA
31,078

 
34,053

 
17,519

 
48,597

 
65,740

 
 
 
 
 
 
 
 
 
 
Building Materials Distribution
 
 
 
 
 
 
 
 
 
Segment income
29,117

 
19,576

 
13,373

 
42,490

 
22,922

Depreciation and amortization
3,354

 
2,874

 
3,235

 
6,589

 
5,613

EBITDA
32,471

 
22,450

 
16,608

 
49,079

 
28,535

 
 
 
 
 
 
 
 
 
 
Corporate and Other
 
 
 
 
 
 
 
 
 
Segment loss
(7,531
)
 
(5,888
)
 
(5,655
)
 
(13,186
)
 
(12,549
)
Depreciation and amortization
429

 
66

 
369

 
798

 
123

EBITDA
(7,102
)
 
(5,822
)
 
(5,286
)
 
(12,388
)
 
(12,426
)
 
 
 
 
 
 
 
 
 
 
Total Company EBITDA
$
56,447

 
$
50,681

 
$
28,841

 
$
85,288

 
$
81,849


13


Exhibit 99.2
Boise Cascade Company
Quarterly Statistical Information

Wood Products Segment
 
 
 
 
 
 
2016
 
Q1
Q2
Q3
Q4
YTD
 LVL sales volume (MCF)
3,566

4,626

 
 
8,192

 I-joist sales volume (MELF)
50,172

64,765

 
 
114,937

 Plywood sales volume (MSF 3/8")
379,631

377,934

 
 
757,565

 Lumber sales volume (MBF)
47,919

49,398

 
 
97,317

 LVL mill net sales price ($/CF)
$
16.74

$
16.79

 
 
$
16.77

 I-joist mill net sales price ($/MELF)
$
1,138

$
1,136

 
 
$
1,137

 Plywood net sales price ($/MSF 3/8")
$
261

$
271

 
 
$
266

 Lumber net sales price ($/MBF)
$
451

$
464

 
 
$
457

 Segment sales (000)
$
303,457

$
346,358

 
 
$
649,815

 Segment income (000)
$
5,885

$
16,309

 
 
$
22,194

 Segment depreciation and amortization (000)
$
11,634

$
14,769

 
 
$
26,403

 Segment EBITDA (000)1
$
17,519

$
31,078

 
 
$
48,597

 EBITDA as a percentage of sales
5.8
%
9.0
%


 
7.5
%
 Capital spending (000)2
$
11,870

$
15,862

 
 
$
27,732

 Receivables (000)
$
111,008

$
78,174

 
 
 
 Inventories (000)
$
175,842

$
190,692

 
 
 
 Accounts payable (000)
$
44,686

$
53,806

 
 
 
 
 
 
 
 
 
 
2015
 
Q1
Q2
Q3
Q4
YTD
 LVL sales volume (MCF)
2,840

3,485

3,785

2,955

13,065

 I-joist sales volume (MELF)
40,810

56,572

57,121

46,319

200,822

 Plywood sales volume (MSF 3/8")
412,139

410,491

412,369

399,577

1,634,576

 Lumber sales volume (MBF)
48,100

55,945

54,354

47,289

205,688

 LVL mill net sales price ($/CF)
$
16.48

$
16.46

$
16.53

$
16.28

$
16.44

 I-joist mill net sales price ($/MELF)
$
1,098

$
1,098

$
1,118

$
1,112

$
1,107

 Plywood net sales price ($/MSF 3/8")
$
312

$
302

$
282

$
268

$
291

 Lumber net sales price ($/MBF)
$
510

$
484

$
477

$
456

$
482

 Segment sales (000)
$
309,316

$
339,869

$
340,621

$
292,307

$
1,282,113

 Segment income (loss) (000)
$
20,896

$
23,712

$
21,876

$
(2,263
)
$
64,221

 Segment depreciation and amortization (000)
$
10,791

$
10,341

$
11,049

$
11,091

$
43,272

 Segment EBITDA (000)1
$
31,687

$
34,053

$
32,925

$
8,828

$
107,493

 EBITDA as a percentage of sales
10.2
%
10.0
%
9.7
%
3.0
%
8.4
%
 Capital spending (000)
$
9,532

$
13,957

$
20,119

$
25,149

$
68,757

 Receivables (000)
$
69,406

$
73,243

$
72,626

$
47,639

 
 Inventories (000)
$
161,586

$
151,000

$
160,134

$
163,961

 
 Accounts payable (000)
$
47,762

$
53,800

$
56,336

$
40,868

 



1



Boise Cascade Company
Quarterly Statistical Information (continued)

Wood Products Segment (continued)
 
 
 
 
 
 
2014
 
Q1
Q2
Q3
Q4
YTD
 LVL sales volume (MCF)
2,642

3,434

3,602

2,677

12,355

 I-joist sales volume (MELF)
39,839

56,813

56,403

39,587

192,642

 Plywood sales volume (MSF 3/8")
414,443

430,404

396,339

409,952

1,651,138

 Lumber sales volume (MBF)
45,883

56,799

57,261

51,690

211,633

 LVL mill net sales price ($/CF)
$
16.00

$
16.28

$
16.59

$
16.34

$
16.32

 I-joist mill net sales price ($/MELF)
$
1,016

$
1,068

$
1,095

$
1,091

$
1,070

 Plywood net sales price ($/MSF 3/8")
$
294

$
301

$
335

$
330

$
314

 Lumber net sales price ($/MBF)
$
569

$
574

$
546

$
544

$
558

 Segment sales (000)
$
293,274

$
351,011

$
355,697

$
317,019

$
1,317,001

 Segment income (000)
$
13,047

$
31,213

$
40,631

$
23,483

$
108,374

 Segment depreciation and amortization (000)
$
9,980

$
10,044

$
10,711

$
10,722

$
41,457

 Segment EBITDA (000)1
$
23,027

$
41,257

$
51,342

$
34,205

$
149,831

 EBITDA as a percentage of sales
7.9
%
11.8
%
14.4
%
10.8
%
11.4
%
 Capital spending (000)
$
9,714

$
5,659

$
11,541

$
13,377

$
40,291

 Receivables (000)
$
62,203

$
70,288

$
66,882

$
53,726

 
 Inventories (000)
$
154,412

$
149,388

$
158,324

$
162,395

 
 Accounts payable (000)
$
45,719

$
55,365

$
55,581

$
42,721

 
 
 
 
 
 
 
1Segment EBITDA is calculated as segment income (loss) before depreciation and amortization.
2 Capital spending in second quarter 2016 and first quarter 2016 excludes $0.3 million and $215.6 million, respectively, of cash paid for the acquisition of businesses and facilities.



2



Boise Cascade Company
Quarterly Statistical Information (continued)

Building Materials Distribution Segment
 
 
 
 
 
2016
 
Q1
Q2
Q3
Q4
YTD
 Commodity sales
47.2
%
45.5
%
 
 
46.2
%
 General line sales
34.4
%
36.5
%
 
 
35.6
%
 EWP sales
18.4
%
18.0
%
 
 
18.2
%
 Total sales (000)
$
717,254

$
850,042

 
 
$
1,567,296

 Gross margin1
11.4
%
12.5
%
 
 
12.0
%
 Segment income (000)
$
13,373

$
29,117

 
 
$
42,490

 Segment depreciation and amortization (000)
$
3,235

$
3,354

 
 
$
6,589

 Segment EBITDA (000)2
$
16,608

$
32,471

 
 
$
49,079

 EBITDA as a percentage of sales
2.3
%
3.8
%


 
3.1
%
 Capital spending (000)
$
2,896

$
3,599

 
 
$
6,495

 Receivables (000)
$
229,673

$
236,954

 
 
 
 Inventories (000)
$
264,721

$
271,306

 
 
 
 Accounts payable (000)
$
248,170

$
217,149

 
 
 
 
 
 
 
 
 
 
2015
 
Q1
Q2
Q3
Q4
YTD
 Commodity sales
48.4
%
45.2
%
45.5
%
47.3
%
46.5
%
 General line sales
34.7
%
37.0
%
36.4
%
35.2
%
35.9
%
 EWP sales
16.9
%
17.8
%
18.1
%
17.5
%
17.6
%
 Total sales (000)
$
622,905

$
762,078

$
798,982

$
707,337

$
2,891,302

 Gross margin1
10.4
%
11.5
%
12.0
%
12.2
%
11.6
%
 Segment income (000)
$
3,346

$
19,576

$
22,684

$
15,145

$
60,751

 Segment depreciation and amortization (000)
$
2,739

$
2,874

$
3,121

$
3,203

$
11,937

 Segment EBITDA (000)2
$
6,085

$
22,450

$
25,805

$
18,348

$
72,688

 EBITDA as a percentage of sales
1.0
%
2.9
%
3.2
%
2.6
%
2.5
%
 Capital spending (000)
$
2,963

$
4,023

$
3,928

$
3,595

$
14,509

 Receivables (000)
$
174,582

$
195,587

$
192,336

$
165,649

 
 Inventories (000)
$
270,881

$
264,114

$
244,481

$
220,896

 
 Accounts payable (000)
$
179,530

$
209,090

$
181,586

$
130,190

 


3


Boise Cascade Company
Quarterly Statistical Information (continued)

Building Materials Distribution Segment (continued)
 
 
 
 
2014
 
Q1
Q2
Q3
Q4
YTD
 Commodity sales
52.2
%
48.7
%
47.7
%
49.6
%
49.4
%
 General line sales
31.9
%
33.7
%
34.8
%
33.7
%
33.6
%
 EWP sales
15.9
%
17.6
%
17.5
%
16.6
%
17.0
%
 Total sales (000)
$
585,530

$
758,375

$
773,391

$
669,367

$
2,786,663

 Gross margin1
10.6
%
11.3
%
12.0
%
11.2
%
11.4
%
 Segment income (000)
$
5,861

$
19,401

$
21,058

$
10,359

$
56,679

 Segment depreciation and amortization (000)
$
2,307

$
2,394

$
2,448

$
2,653

$
9,802

 Segment EBITDA (000)2
$
8,168

$
21,795

$
23,506

$
13,012

$
66,481

 EBITDA as a percentage of sales
1.4
%
2.9
%
3.0
%
1.9
%
2.4
%
 Capital spending (000)
$
2,720

$
3,551

$
7,161

$
6,917

$
20,349

 Receivables (000)
$
163,820

$
181,390

$
176,920

$
142,891

 
 Inventories (000)
$
266,647

$
261,176

$
240,547

$
232,066

 
 Accounts payable (000)
$
167,152

$
174,402

$
149,548

$
119,054

 
 
 
 
 
 
 
1We define gross margin as "Sales" less "Materials, labor, and other operating expenses (excluding depreciation)." Substantially all costs included in "Materials, labor, and other operating expenses (excluding depreciation)" for our Building Materials Distribution segment are for inventory purchased for resale. Gross margin percentage is gross margin as a percentage of segment sales.
2Segment EBITDA is calculated as segment income before depreciation and amortization.



4



Boise Cascade Company
Quarterly Statistical Information (continued)
Reconciliation of Non-GAAP Financial Measures
(000)

Total Boise Cascade Company
 
 
 
 
 
 
 
 
 
 
EBITDA represents income before interest (interest expense, interest income, and change in fair value of interest rate swaps), income taxes, depreciation and amortization. The following tables reconcile net income to EBITDA for the periods noted below:
 
2016
 
Q1
Q2
Q3
Q4
YTD
 
 
 
 
 
 
Net income
$
4,950

$
19,228

 
 
$
24,178

Interest expense
5,802

6,427

 
 
12,229

Interest income
(149
)
(27
)
 
 
(176
)
Change in fair value of interest rate swaps
69

1,532

 
 
1,601

Income tax provision
2,931

10,735

 
 
13,666

Depreciation and amortization
15,238

18,552

 
 
33,790

EBITDA
$
28,841

$
56,447





$
85,288

 
 
 
 
 
 
 
2015
 
Q1
Q2
Q3
Q4
YTD
 
 
 
 
 
 
Net income
$
7,617

$
20,230

$
22,007

$
2,328

$
52,182

Interest expense
5,481

5,591

5,729

5,731

22,532

Interest income
(90
)
(58
)
(73
)
(102
)
(323
)
Income tax provision (benefit)
4,573

11,637

12,629

(339
)
28,500

Depreciation and amortization
13,587

13,281

14,249

14,461

55,578

EBITDA
$
31,168

$
50,681

$
54,541

$
22,079

$
158,469

 
 
 
 
 
 
 
2014
 
Q1
Q2
Q3
Q4
YTD
 
 
 
 
 
 
Net income
$
5,565

$
26,418

$
32,285

$
15,741

$
80,009

Interest expense
5,512

5,519

5,514

5,504

22,049

Interest income
(70
)
(53
)
(57
)
(57
)
(237
)
Income tax provision
3,461

14,286

18,133

7,416

43,296

Depreciation and amortization
12,320

12,482

13,203

13,434

51,439

EBITDA
$
26,788

$
58,652

$
69,078

$
42,038

$
196,556



5

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