• Full Year Revenue: $3 billion.
• Fourth Quarter Revenue: $711 million, flat year over year.
• Full Year Adjusted EBITDA: $131 million, 4.4% of net sales.
• Fourth Quarter Adjusted EBITDA: $22 million, 3% of net sales.
• Full Year Adjusted Net Income: $55 million, $6.44 per diluted share.
• Fourth Quarter Net Income: $5.3 million, $0.62 per diluted share.
• Full Year Gross Margin: 16.6%.
• Fourth Quarter Gross Margin: 15.9%.
• Specialty Products Gross Margin (Full Year): 19.4%.
• Structural Products Gross Margin (Full Year): 10.1%.
• Specialty Products Gross Margin (Q4): 18.4%.
• Structural Products Gross Margin (Q4): 10.8%.
• Liquidity: $852 million, including $506 million cash on hand.
• SG&A Expenses (Q4): $93 million, up 10% year over year.
• Share Repurchase: $45 million returned to shareholders in 2024.
• Capital Expenditures (Full Year): $40 million.
• Free Cash Flow (Full Year): $45 million.

• Warning! GuruFocus has detected 10 Warning Signs with CHCT.

Release Date: February 19, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• BlueLinx Holdings Inc (NYSE:BXC) delivered solid full-year 2024 results with strong margins in specialty (19.4%) and structural products (10.1%).
• The company demonstrated a commitment to returning capital to shareholders by repurchasing shares under a $100 million authorization, returning $45 million to shareholders in 2024.
• BlueLinx Holdings Inc (NYSE:BXC) is focused on high-margin specialty product categories, which accounted for approximately 70% of net sales and 80% of gross profit for both the fourth quarter and full year 2024.
• The company is undergoing a digital transformation to become the most technologically advanced two-step distributor in the U.S., with initiatives like a new master data management platform and an e-commerce platform.
• BlueLinx Holdings Inc (NYSE:BXC) maintains a strong financial position with $852 million in liquidity, including $506 million in cash, providing flexibility for reinvestment and strategic initiatives.

Negative Points

• The housing and building products market remains uncertain due to elevated interest rates, home affordability issues, and market volatility, impacting sales and growth prospects.
• Despite solid results, net sales for 2024 were down 6% from 2023, largely due to specialty price deflation.
• SG&A expenses increased by 10% in the fourth quarter, driven by higher payroll and logistics costs, impacting overall profitability.
• The company faces challenges in the broader housing market, with low existing home sales and soft repair and remodel spending due to economic conditions.
• Weather disruptions in early 2025 adversely impacted daily volumes, with over 20 locations closed for at least half a day in January.

Q & A Highlights

Q: Can you provide more color on the sequential improvement in specialty product pricing during the quarter and expectations for fiscal '25? A: Shyam Reddy, President and CEO, explained that the company has seen five consecutive quarters of year-over-year growth in specialty products, driven by a targeted strategy focusing on national accounts and multi-family expansion. While market pricing remains uncertain due to policy positions, BlueLinx is confident in its ability to stabilize pricing through operational excellence and inventory management. However, the market remains volatile, with pricing improving in January but declining in February.

Q: What are you hearing from channel partners and contractor customers regarding repair and remodel (R&R) demand expectations in 2025? A: Shyam Reddy noted that low existing home sales turnover generally pressures R&R activity. However, BlueLinx is focused on national accounts and product mix to support both small and large R&R jobs, allowing the company to gain market share despite current market dynamics.

Q: What is the timeline for the full ramp of your e-commerce platform? A: Shyam Reddy stated that the e-commerce platform is currently in a pilot phase, with enhancements being made to scale it across other markets. The company views this as a multi-year journey, gradually investing to meet customer needs and expand capabilities over time.

Q: Can you provide an update on the ramp-up of the Portland Greenfield location and expectations for future openings? A: Shyam Reddy mentioned that the Portland location is in its early stages, with equipment and personnel being put in place. The company expects it to be EBITDA positive after two years. While there is an aggressive posture towards opening more locations, real estate availability remains a constraint.

Q: How might your strategy on the structural side change if tariffs on Canada are implemented? A: Shyam Reddy indicated that market volatility or uncertainty could cause spending holdbacks. However, BlueLinx has confidence in its inventory management capabilities and vendor relationships to manage risks. The company will continue to be in the space and manage buys accordingly without compromising customer relationships.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.