BOISE, ID - Boise Cascade Holdings, L.L.C. announced sales of $587 million in first quarter 2012, a 21% increase over the same quarter a year ago.  The Company reported first quarter earnings before interest, taxes, depreciation, and amortization (EBITDA) of $14.6 million and net income of $1.7 million.  Boise Cascade reported negative EBITDA of $5.6 million in first quarter 2011 and positive EBITDA of $0.5 million in fourth quarter 2011.

The Company used $18.0 million of cash during the first quarter principally to support seasonal working capital growth and capital investments.  At March 31, 2012, Boise Cascade had total available liquidity of $371.9 million, with $164.4 million in cash and committed bank line availability of $207.5 million.  

First quarter 2012 revenues and earnings were higher on improved demand relative to the year ago quarter.  While the Company's revenues and earnings continue to be negatively impacted by depressed demand for the products it distributes and manufactures, the mild winter in the U.S., improved residential construction activity, and its market share gains in engineered wood products (EWP) and plywood contributed to a better start of the year.  U.S. housing starts increased approximately 19% in the first quarter of 2012 from the levels experienced in 2011.  Single-family starts, which are a primary driver of the Company's sales, experienced an increase of 17% from the year-ago quarter.  With the more favorable start to the year, the Blue Chip consensus forecast for U.S. housing starts for 2012 has been revised upward to 740,000 as of April 10, 2012.  The final U.S. housing starts level reported for 2011 was 609,000.

"The demand level in the first quarter was stronger following the tough industry conditions and weather in 2011.  We are hopeful the increase in sales activity and our earnings will carry through to the rest of the year.  Our liquidity puts us in a good position to respond to any improvement in the markets and take advantage of business opportunities," commented Tom Carlile, CEO.  

Building Materials Distribution (BMD) segment sales were $451.4 million in the first quarter 2012, up 19% from the same quarter a year ago.  Volumes for the segment were up approximately 16%, with prices up about 3%.  BMD reported $1.4 million of EBITDA in first quarter 2012, compared to negative $2.5 million and positive $1.3 million in the first and fourth quarters of 2011, respectively.

Wood Products segment sales in the first quarter 2012 were $211.1 million, up 36% from the same quarter a year ago.   The increase in sales was due primarily to increased plywood volumes and prices and increased EWP shipments, offset in part by lower EWP sales price realizations.   The segment reported $16.7 million of EBITDA in first quarter 2012 compared to negative $0.5 million and positive $2.2 million in the first and fourth quarters of 2011, respectively.  

Outlook

Absent further declines in unemployment and a reduction in the housing supply overhang, we expect to continue to experience below normal demand for the products we distribute and manufacture.  Industry commodity wood product prices could be volatile in response to operating rates and inventory levels in various distribution channels.  We expect to manage our production levels to our sales demand, which will likely cause us to operate some of our facilities below their capacity.  

About Boise Cascade

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

Basis of Presentation

We present our consolidated financial statements in accordance with U.S. generally accepted accounting principles (GAAP).  Our earnings release also supplements the GAAP presentations by reflecting EBITDA, a non-GAAP financial measure.  EBITDA represents income (loss) before interest (interest expense and interest income), income taxes, and depreciation and amortization.  EBITDA is the primary measure used by our chief operating decision maker 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 internal decision makers 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 (loss), income (loss) 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 (loss) 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 the limitations of EBITDA 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.

  
Boise Cascade Holdings, L.L.C.
Consolidated Statements of Income (Loss)
(unaudited, in thousands)

Summary Notes to Consolidated Financial Statements and Segment Information

        The Consolidated Statements of Income (Loss), 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 2011 Form 10-K and the company's Quarterly Report on Form 10-Q for the period ended March 31, 2012. Net income (loss) for all periods presented involved estimates and accruals.

1. In first quarter 2011, we committed to curtail a manufacturing plant in our Wood Products segment and we  recorded the related expense of $1.4 million in "Other (income) expense, net" and $0.1 million of accelerated depreciation in "Depreciation and Amortization" in our Consolidated Statement of Income (Loss). The manufacturing plant was permanently closed on June 30, 2011. Also, during the three months ended March 31, 2011, we recorded $1.2 million of noncash asset write-downs in "Other (income) expense, net," of which $0.8 million was recorded in our Building Materials Distribution segment and $0.4 million was recorded in our Wood Products segment.  

2. EBITDA represents income (loss) before interest (interest expense and interest income), income taxes, and depreciation and amortization. The following table reconciles net income (loss) to EBITDA for the three months ended March 31, 2012 and 2011, and December 31, 2011: 

Source: Boise Cascade Corporation