Boise Cascade reports third quarter profits of $15.9 million

October 21, 2013 

Boise Cascade Company Monday reported third quarter profits of $15.9 million — up from the second quarter’s $10.4 million but down from $23.5 million in the third quarter of last year.

Total sales for the Boise-based wood-products distributor were up from last year’s levels — $878 million, up from about $765 million in the third quarter of 2012. The company’s notable expenses so far this year include purchase of two plywood plants in the Carolinas for $102 million and spending $100 million to buy 3.76 million shares of Boise Cascade stock to hold as “treasury stock” that it can sell in the future or use to make a future acquisition.

Those purchases used proceeds from Boise Cascade’s initial public offering in February. The company netted nearly $263 million from the sale of about 13.5 million shares for $21 per share.

On Monday, the stock closed at $26.84 up from Friday’s close of $25.09.

Boise Cascade CEO Tom Carlile said the company’s wood products and building materials distribution segments both showed “solid performances” in the third quarter and sales increases over the previous year.

“Our distribution business rebounded sharply from a challenging second quarter,” Carlile said in a news release. “Wood Products executed well on internal veneer production, which allowed us to grow engineered wood product sales while maintaining plywood sales volumes.”

He said acquisition of the new plywood plants, finalized on the last day of the quarter Sept. 30, positions the company to “support our existing, as well as new, customers in the Southeast.”

“For the balance of 2013, we expect to continue to experience demand below 20-year average historical levels for the products we manufacture and distribute,” the company said in its news release. “However, the housing industry has shown signs of improvement in the U.S., and we remain optimistic that the improvement in demand for our products will continue.

Boise Cascade ended third quarter 2013 with total available liquidity of $431.7 million and outstanding debt of $326.7 million.

Boise Cascade Corp. was an iconic Idaho company that fell on hard times more than a decade ago. It was publicly held until 2004, when it bought OfficeMax, assumed the OfficeMax name, and moved its headquarters to the Chicago area.

OfficeMax promptly sold most of its interest in the former Boise Cascade timberlands, paper-making business, and wood products and building materials distribution divisions to the Chicago private equity firm Madison Dearborn, retaining about 20 percent for OfficeMax.

Madison Dearborn created Boise Cascade LLC, which soon sold off the timber lands. In 2008, the paper, packaging and newsprint operations were sold to a pair of investors who turned them into a publicly held company called Boise Inc. Packaging Corp. of America announced last month it is purchasing Boise Inc. for $1.27 billion.

Madison Dearborn and OfficeMax sold about 10 million shares of Boise Cascade stock this summer, and Boise Cascade made a secondary public offering to further increase public ownership of the company.

With $3 billion in annual revenues, Boise Cascade employs about 4,800 workers, including about 160 at its headquarters at 11th and Jefferson streets in Boise and another 160 at building material distribution yards in Boise and Idaho Falls and a laminated-beam plant outside of Nampa.

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