Attached files
| file | filename |
|---|---|
| 8-K - 8-K - BOISE CASCADE HOLDINGS, L.L.C. | a09-33100_18k.htm |
| EX-99.2 - EX-99.2 - BOISE CASCADE HOLDINGS, L.L.C. | a09-33100_1ex99d2.htm |
|
Boise Cascade |
EXHIBIT 99.1 |
|
1111 West Jefferson Street Ste 300 PO Box 50 Boise, ID 83728 |
|
|
News Release
|
|
Investor Relations Contact
Wayne Rancourt
Office 208 384 6073
For Immediate Release: November 13, 2009
Boise Cascade Holdings Reports Third Quarter 2009 Financial Results
BOISE, Idaho – Boise Cascade Holdings, L.L.C. (BC Holdings or Company) announced net income of $26.2 million for the quarter ended September 30, 2009. Included in its net income was $28.2 million of noncash income associated with the Company’s equity investment in Boise Inc.
In third quarter 2009, BC Holdings’ building products subsidiary, Boise Cascade, L.L.C., reported earnings before interest, taxes, depreciation, and amortization (EBITDA) of $11.9 million, as compared to negative EBITDA of $3.5 million in second quarter 2009. The Company’s cash and net debt position improved $9.5 million during the third quarter, with the company reporting $279.1 million of available liquidity at September 30, 2009. The individual segment results are discussed in more detail below.
“The lackluster demand for new residential construction continues to present challenges, but we are executing well. In Building Materials Distribution, sales were up 9% from the second quarter and EBITDA increased 21%. In Wood Products, sales increased 21% from the second quarter and the business reported positive EBITDA of $3.4 million, which was significantly better than the $9.8 million of negative EBITDA in the prior quarter. The first few months of operations have gone well at the two acquisitions we made in June. We have improved our cost position over the last year and it shows. Most importantly, even in this difficult market our employees are achieving the best safety results in the history of our Wood Products and Building Materials Distribution operations. We also have a very good liquidity position to get us through this winter and allow us to take advantage of market opportunities as we move into next year,” commented Tom Carlile, CEO of Boise Cascade.
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Third Quarter Segment Results
U.S. housing starts declined 32% in the third quarter, dropping from an annualized rate of 0.87 million in third quarter 2008 to 0.59 million in third quarter 2009. In the third quarter, continuing foreclosures, high inventories of unsold homes, rising unemployment, and low consumer confidence contributed to a weak demand environment for the building products we manufacture and distribute.
Sales in our Building Materials Distribution (BMD) business during the third quarter were $472.2 million, compared with $433.7 million in second quarter 2009 and $584.1 million in third quarter 2008. Compared with third quarter 2008, the 19% decline in sales resulted from a 13% decline in product volumes sold and a 7% decrease in product prices. EBITDA generated by BMD improved 21% to $11.6 million in third quarter 2009 from $9.6 million of EBITDA in second quarter 2009. BMD’s third quarter 2008 EBITDA was $12.1 million. The segment’s lower sales activity, compared to the same quarter a year ago, resulted in fewer gross margin dollars being generated to cover cash operating costs, such as occupancy, payroll, and delivery. However, well over 90% of the decline in gross profit dollars, compared to third quarter 2008, was offset by lower operating costs and cost reduction initiatives implemented over the last year.
Sales in our Wood Products segment during the third quarter were $163.2 million, compared with $134.4 million in second quarter 2009 and $215.1 million in third quarter 2008. Compared with third quarter 2008, sales of engineered wood products, plywood, and particleboard declined due to lower volumes and prices. Lumber sales also declined on lower volumes and modestly higher prices than the same quarter a year ago. Third quarter EBITDA for Wood Products was $3.4 million, a sharp improvement from the negative $9.8 million of EBITDA reported in second quarter 2009. Wood Products reported $3.6 million of positive EBITDA in third quarter 2008. Lower log costs, productivity improvements, and curtailments at facilities previously generating cash losses essentially offset the negative impact of lower sales volumes and prices compared to the same quarter a year ago. We have been taking rolling curtailments at all of our Wood Products operations to maintain appropriate inventory levels, while trying to minimize the negative impact these curtailments have on our employees and our operating results.
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Outlook
We expect end-product demand to remain weak when compared to normal historical demand levels, with single-family housing starts unlikely to show any significant rebound during the remainder of 2009. Absent a change in unemployment trends, stronger levels of consumer confidence, and a reduction in foreclosures and housing vacancy rates, weakness in final demand for the products we manufacture and distribute is likely to continue into the first half of 2010. Industry product sales volumes are likely to remain depressed and commodity wood product prices will largely depend on operating rates. We expect to manage our production levels to our sales demand, which will likely cause us to operate our facilities below their capacity.
About Boise Cascade
BC Holdings is a privately held company headquartered in Boise, Idaho. Our wholly owned subsidiary, Boise Cascade, L.L.C., 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. BC Holdings is also a major shareholder of Boise Inc., a publicly traded North American paper and packaging producer listed on the New York Stock Exchange. For more information, please visit our website at www.bc.com.
Webcast and Conference Call
BC Holdings will host a webcast and conference call on Friday, November 13, at 11:00 a.m. Eastern, at which time we will review the company’s recent performance. You can join the webcast through the Boise Cascade website. Go to www.bc.com and click on the link to the webcast under the News & Events heading. Please go to the website at least 15 minutes before the start of the webcast to register. To join the conference call, dial 800-374-0165 (international callers should dial 706-902-1407) at least 10 minutes before the start of the call.
The archived webcast will be available in the News & Events section of Boise Cascade’s website. A replay of the conference call will be available from Friday, November 13, at 2:00 p.m. Eastern through Friday, November 20, at 11:59 p.m. Eastern. Playback numbers are 800-642-1687 for U.S. calls and 706-645-9291 for international calls, and the passcode will be 37294207.
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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. EBITDA represents income (loss) before interest (interest expense, interest income, and change in fair value of interest rate swaps), income taxes, and depreciation, amortization, and depletion. EBITDA is the primary measure used by our chief operating decision makers 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 in the evaluation of companies. 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. For example, we believe that the inclusion of items such as taxes, interest expense, and interest income distorts management’s ability to assess and view the core operating trends in our segments. 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, change in fair value of interest rate swaps, and associated significant cash requirements; and the exclusion of depreciation, amortization, and depletion. Management compensates for these limitations by relying on our GAAP results. Our measures of EBITDA are 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
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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.
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-6-
Boise Cascade Holdings, L.L.C.
Consolidated Statements of Income (Loss)
(unaudited, in thousands)
|
|
|
Three Months Ended |
||||||||||
|
|
|
September 30 |
|
June 30, |
|
|||||||
|
|
|
2009 |
|
2008 |
|
2009 |
||||||
|
Sales |
|
|
|
|
|
|
|
|
|
|||
|
Trade |
|
$ |
567,643 |
|
|
$ |
705,912 |
|
|
$ |
512,247 |
|
|
Related parties |
|
11,364 |
|
|
21,214 |
|
|
8,933 |
|
|||
|
|
|
579,007 |
|
|
727,126 |
|
|
521,180 |
|
|||
|
Costs and expenses |
|
|
|
|
|
|
|
|
|
|||
|
Materials, labor, and other operating expenses (a) |
|
501,886 |
|
|
627,407 |
|
|
463,699 |
|
|||
|
Materials, labor, and other operating expenses from related parties |
|
6,094 |
|
|
19,045 |
|
|
6,332 |
|
|||
|
Depreciation, amortization, and depletion (a) |
|
9,627 |
|
|
8,751 |
|
|
11,448 |
|
|||
|
Selling and distribution expenses |
|
50,714 |
|
|
62,537 |
|
|
47,771 |
|
|||
|
General and administrative expenses |
|
6,841 |
|
|
7,259 |
|
|
6,863 |
|
|||
|
General and administrative expenses from related party |
|
2,682 |
|
|
2,506 |
|
|
2,503 |
|
|||
|
Loss on sale of Paper and Packaging & Newsprint assets (b) |
|
- |
|
|
1,739 |
|
|
- |
|
|||
|
Other (income) expense, net (a) |
|
(575 |
) |
|
(3,768 |
) |
|
(1,751 |
) |
|||
|
|
|
577,269 |
|
|
725,476 |
|
|
536,865 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
Income (loss) from operations |
|
1,738 |
|
|
1,650 |
|
|
(15,685 |
) |
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
Equity in income of affiliate |
|
28,225 |
|
|
2,148 |
|
|
30,306 |
|
|||
|
Gain on sale of shares of equity affiliate (c) |
|
997 |
|
|
- |
|
|
- |
|
|||
|
Impairment of investment in equity affiliate (e) |
|
- |
|
|
(208,074 |
) |
|
- |
|
|||
|
Foreign exchange gain (loss) |
|
521 |
|
|
(406 |
) |
|
715 |
|
|||
|
Change in fair value of contingent value rights |
|
- |
|
|
2,227 |
|
|
- |
|
|||
|
Interest expense |
|
(5,389 |
) |
|
(6,263 |
) |
|
(6,135 |
) |
|||
|
Interest income |
|
185 |
|
|
1,469 |
|
|
178 |
|
|||
|
|
|
24,539 |
|
|
(208,899 |
) |
|
25,064 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
|
Income (loss) before income taxes |
|
26,277 |
|
|
(207,249 |
) |
|
9,379 |
|
|||
|
Income tax provision |
|
(72 |
) |
|
(391 |
) |
|
(68 |
) |
|||
|
Net income (loss) |
|
$ |
26,205 |
|
|
$ |
(207,640 |
) |
|
$ |
9,311 |
|
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Segment Information
(unaudited, in thousands)
|
|
|
Three Months Ended |
|
|||||||
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September 30 |
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June 30, |
|
|||||
|
|
|
2009 |
|
2008 |
|
2009 |
|
|||
|
Segment sales |
|
|
|
|
|
|
|
|||
|
Building Materials Distribution |
|
$ |
472,172 |
|
$ |
584,094 |
|
$ |
433,662 |
|
|
Wood Products |
|
163,183 |
|
215,057 |
|
134,404 |
|
|||
|
Intersegment eliminations and other |
|
(56,348) |
|
(72,025) |
|
(46,886) |
|
|||
|
|
|
$ |
579,007 |
|
$ |
727,126 |
|
$ |
521,180 |
|
|
|
|
|
|
|
|
|
|
|||
|
Segment income (loss) |
|
|
|
|
|
|
|
|||
|
Building Materials Distribution |
|
$ |
9,683 |
|
$ |
10,223 |
|
$ |
7,647 |
|
|
Wood Products (a) |
|
(4,203) |
|
(3,126) |
|
(19,206) |
|
|||
|
Corporate and Other (b) |
|
(3,221) |
|
(5,853) |
|
(3,411) |
|
|||
|
|
|
2,259 |
|
1,244 |
|
(14,970) |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
Equity in net income of affiliate |
|
28,225 |
|
2,148 |
|
30,306 |
|
|||
|
Gain on sale of shares of equity affiliate (c) |
|
997 |
|
- |
|
- |
|
|||
|
Impairment of investment in equity affiliate (e) |
|
- |
|
(208,074) |
|
- |
|
|||
|
Change in fair value of contingent value rights |
|
- |
|
2,227 |
|
- |
|
|||
|
Interest expense |
|
(5,389) |
|
(6,263) |
|
(6,135) |
|
|||
|
Interest income |
|
185 |
|
1,469 |
|
178 |
|
|||
|
Income (loss) before income taxes |
|
$ |
26,277 |
|
$ |
(207,249) |
|
$ |
9,379 |
|
|
|
|
|
|
|
|
|
|
|||
|
EBITDA (i) |
|
|
|
|
|
|
|
|||
|
Building Materials Distribution |
|
$ |
11,563 |
|
$ |
12,129 |
|
$ |
9,560 |
|
|
Wood Products (a) |
|
3,432 |
|
3,631 |
|
(9,785) |
|
|||
|
Corporate and Other (b) |
|
(3,109) |
|
(5,765) |
|
(3,297) |
|
|||
|
Equity in net income (loss) of affiliate |
|
28,225 |
|
2,148 |
|
30,306 |
|
|||
|
Gain on sale of shares of equity affiliate (c) |
|
997 |
|
- |
|
- |
|
|||
|
Impairment of investment in equity affiliate (e) |
|
- |
|
(208,074) |
|
- |
|
|||
|
Change in fair value of contingent value rights |
|
- |
|
2,227 |
|
- |
|
|||
|
|
|
$ |
41,108 |
|
$ |
(193,704) |
|
$ |
26,784 |
|
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-8-
Boise Cascade Holdings, L.L.C.
Consolidated Statements of Income (Loss)
(unaudited, in thousands)
|
|
|
Nine Months Ended |
|
||||
|
|
|
September 30 |
|
||||
|
|
|
2009 |
|
2008 (h) |
|
||
|
Sales |
|
|
|
|
|
||
|
Trade |
|
$ |
1,487,614 |
|
$ |
2,330,114 |
|
|
Related parties |
|
26,000 |
|
130,782 |
|
||
|
|
|
1,513,614 |
|
2,460,896 |
|
||
|
Costs and expenses |
|
|
|
|
|
||
|
Materials, labor, and other operating expenses (a) |
|
1,346,656 |
|
2,157,951 |
|
||
|
Materials, labor, and other operating expenses from related parties |
|
24,716 |
|
48,234 |
|
||
|
Depreciation, amortization, and depletion (a) |
|
32,194 |
|
27,470 |
|
||
|
Selling and distribution expenses |
|
143,726 |
|
183,502 |
|
||
|
General and administrative expenses |
|
20,629 |
|
29,770 |
|
||
|
General and administrative expenses from related party |
|
7,618 |
|
6,010 |
|
||
|
Gain on sale of Paper and Packaging & Newsprint assets (b) |
|
- |
|
(2,996) |
|
||
|
Other (income) expense, net (a) (d) |
|
355 |
|
3,925 |
|
||
|
|
|
1,575,894 |
|
2,453,866 |
|
||
|
|
|
|
|
|
|
||
|
Income (loss) from operations |
|
(62,280) |
|
7,030 |
|
||
|
|
|
|
|
|
|
||
|
Equity in net income (loss) of affiliate |
|
61,536 |
|
(15,249) |
|
||
|
Gain on sale of shares of equity affiliate (c) |
|
997 |
|
- |
|
||
|
Impairment of investment in equity affiliate (e) |
|
(43,039) |
|
(208,074) |
|
||
|
Foreign exchange gain (loss) |
|
904 |
|
(129) |
|
||
|
Change in fair value of contingent value rights |
|
194 |
|
(1,803) |
|
||
|
Change in fair value of interest rate swaps (f) |
|
- |
|
(6,284) |
|
||
|
Gain on repurchase of long-term debt (g) |
|
6,026 |
|
- |
|
||
|
Interest expense |
|
(17,140) |
|
(28,071) |
|
||
|
Interest income |
|
760 |
|
6,629 |
|
||
|
|
|
10,238 |
|
(252,981) |
|
||
|
|
|
|
|
|
|
||
|
Loss before income taxes |
|
(52,042) |
|
(245,951) |
|
||
|
Income tax provision |
|
(623) |
|
(1,523) |
|
||
|
Net loss |
|
$ |
(52,665) |
|
$ |
(247,474) |
|
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-9-
Segment Information
(unaudited, in thousands)
|
|
|
Nine Months Ended |
|
||||||
|
|
|
September 30 |
|
||||||
|
|
|
2009 |
|
2008 (h) |
|
||||
|
Segment sales |
|
|
|
|
|
||||
|
Building Materials Distribution |
|
$ |
1,240,856 |
|
$ |
1,697,956 |
|
||
|
Wood Products |
|
414,066 |
|
639,817 |
|
||||
|
Paper |
|
- |
|
253,508 |
|
||||
|
Packaging & Newsprint |
|
- |
|
113,485 |
|
||||
|
Intersegment eliminations and other |
|
(141,308) |
|
(243,870) |
|
||||
|
|
|
$ |
1,513,614 |
|
$ |
2,460,896 |
|
||
|
|
|
|
|
|
|
||||
|
Segment income (loss) |
|
|
|
|
|
||||
|
Building Materials Distribution |
|
$ |
8,786 |
|
$ |
24,344 |
|
||
|
Wood Products (a) |
|
(61,040) |
|
(23,607) |
|
||||
|
Paper |
|
- |
|
20,718 |
|
||||
|
Packaging & Newsprint |
|
- |
|
5,685 |
|
||||
|
Corporate and Other (b) (d) |
|
(9,122) |
|
(20,239) |
|
||||
|
|
|
(61,376) |
|
6,901 |
|
||||
|
|
|
|
|
|
|
||||
|
Equity in net income (loss) of affiliate |
|
61,536 |
|
(15,249) |
|
||||
|
Gain on sale of shares of equity affiliate (c) |
|
997 |
|
- |
|
||||
|
Impairment of investment in equity affiliate (e) |
|
(43,039) |
|
(208,074) |
|
||||
|
Change in fair value of contingent value rights |
|
194 |
|
(1,803) |
|
||||
|
Change in fair value of interest rate swaps (f) |
|
- |
|
(6,284) |
|
||||
|
Gain on repurchase of long-term debt (g) |
|
6,026 |
|
- |
|
||||
|
Interest expense |
|
(17,140) |
|
(28,071) |
|
||||
|
Interest income |
|
760 |
|
6,629 |
|
||||
|
Loss before income taxes |
|
$ |
(52,042) |
|
$ |
(245,951) |
|
||
|
|
|
|
|
|
|
||||
|
EBITDA (i) |
|
|
|
|
|
||||
|
Building Materials Distribution |
|
$ |
14,512 |
|
$ |
30,112 |
|
||
|
Wood Products (a) |
|
(34,912) |
|
(2,654) |
|
||||
|
Paper |
|
- |
|
21,066 |
|
||||
|
Packaging & Newsprint |
|
- |
|
5,738 |
|
||||
|
Corporate and Other (b) (d) |
|
(8,782) |
|
(19,891) |
|
||||
|
Equity in net income (loss) of affiliate |
|
61,536 |
|
(15,249) |
|
||||
|
Gain on sale of shares of equity affiliate (c) |
|
997 |
|
- |
|
||||
|
Impairment of investment in equity affiliate (e) |
|
(43,039) |
|
(208,074) |
|
||||
|
Change in fair value of contingent value rights |
|
194 |
|
(1,803) |
|
||||
|
Gain on repurchase of long-term debt (g) |
|
6,026 |
|
- |
|
||||
|
|
|
$ |
(3,468) |
|
$ |
(190,755) |
|
||
- more -
-10-
Boise Cascade Holdings, L.L.C.
Consolidated Balance Sheets
(unaudited, in thousands)
|
|
|
September 30, |
|
December 31, |
|
||
|
|
|
2009 |
|
2008 |
|
||
|
ASSETS |
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
Current |
|
|
|
|
|
||
|
Cash and cash equivalents |
|
$ |
214,129 |
|
$ |
275,803 |
|
|
Receivables |
|
|
|
|
|
||
|
Trade, less allowances of $2,277 and $1,843 |
|
132,889 |
|
78,393 |
|
||
|
Related parties |
|
3,518 |
|
3,112 |
|
||
|
Other |
|
2,627 |
|
5,907 |
|
||
|
Inventories |
|
233,746 |
|
279,023 |
|
||
|
Prepaid expenses and other |
|
4,753 |
|
1,296 |
|
||
|
|
|
591,662 |
|
643,534 |
|
||
|
Property |
|
|
|
|
|
||
|
Property and equipment, net |
|
275,364 |
|
291,999 |
|
||
|
Timber deposits |
|
7,931 |
|
8,632 |
|
||
|
|
|
283,295 |
|
300,631 |
|
||
|
|
|
|
|
|
|
||
|
Investment in equity affiliate |
|
78,822 |
|
20,985 |
|
||
|
Deferred financing costs |
|
6,064 |
|
7,862 |
|
||
|
Goodwill |
|
12,170 |
|
12,170 |
|
||
|
Intangible assets, net |
|
8,955 |
|
9,248 |
|
||
|
Other assets |
|
9,038 |
|
6,009 |
|
||
|
Total assets |
|
$ |
990,006 |
|
$ |
1,000,439 |
|
- more -
-11-
Boise Cascade Holdings, L.L.C.
Consolidated Balance Sheets (continued)
(unaudited, in thousands, except for equity units)
|
|
|
September 30, |
|
December 31, |
|
||
|
|
|
2009 |
|
2008 |
|
||
|
LIABILITIES AND CAPITAL |
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
Current |
|
|
|
|
|
||
|
Accounts payable |
|
|
|
|
|
||
|
Trade |
|
$ |
108,205 |
|
$ |
69,478 |
|
|
Related parties |
|
2,286 |
|
2,195 |
|
||
|
Accrued liabilities |
|
|
|
|
|
||
|
Compensation and benefits |
|
31,744 |
|
38,228 |
|
||
|
Interest payable |
|
7,698 |
|
3,930 |
|
||
|
Other |
|
19,576 |
|
30,893 |
|
||
|
|
|
169,509 |
|
144,724 |
|
||
|
Debt |
|
|
|
|
|
||
|
Long-term debt |
|
303,146 |
|
315,000 |
|
||
|
|
|
|
|
|
|
||
|
Other |
|
|
|
|
|
||
|
Compensation and benefits |
|
124,073 |
|
172,275 |
|
||
|
Other long-term liabilities |
|
13,367 |
|
12,125 |
|
||
|
|
|
137,440 |
|
184,400 |
|
||
|
Redeemable equity units |
|
|
|
|
|
||
|
Series B equity units – 2,764,854 units and 2,920,574 units outstanding |
|
2,765 |
|
2,920 |
|
||
|
Series C equity units – 16,270,616 units and 11,016,668 units outstanding |
|
4,768 |
|
3,037 |
|
||
|
|
|
7,533 |
|
5,957 |
|
||
|
Commitments and contingent liabilities |
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
Capital |
|
|
|
|
|
||
|
Series A equity units – no par value; 66,000,000 units authorized and outstanding |
|
87,185 |
|
81,967 |
|
||
|
Series B equity units – no par value; 550,000,000 units authorized and 532,558,673 units and 532,414,853 units outstanding |
|
285,193 |
|
268,391 |
|
||
|
Series C equity units – no par value; 44,000,000 units authorized and 11,951,751 units and 11,183,000 units outstanding |
|
- |
|
- |
|
||
|
Total capital |
|
372,378 |
|
350,358 |
|
||
|
Total liabilities and capital |
|
$ |
990,006 |
|
$ |
1,000,439 |
|
- more -
-12-
Boise Cascade Holdings, L.L.C.
Consolidated Statements of Cash Flows
(unaudited, in thousands)
|
|
|
Nine Months Ended |
|
||||
|
|
|
September 30 |
|
||||
|
|
|
2009 |
|
2008 |
|
||
|
Cash provided by (used for) operations |
|
|
|
|
|
||
|
Net loss |
|
$ |
(52,665) |
|
$ |
(247,474) |
|
|
Items in net loss not using (providing) cash |
|
|
|
|
|
||
|
Equity in net (income) loss of affiliate |
|
(61,536) |
|
15,249 |
|
||
|
Gain on sale of shares of equity affiliate |
|
(997) |
|
- |
|
||
|
Impairment of investment in equity affiliate |
|
43,039 |
|
208,074 |
|
||
|
Depreciation, depletion, and amortization of deferred financing costs and other |
|
34,469 |
|
28,630 |
|
||
|
Related-party interest income |
|
- |
|
(2,760) |
|
||
|
Pension and other postretirement benefit expense |
|
10,002 |
|
10,616 |
|
||
|
Change in fair value of contingent value rights |
|
(194) |
|
1,803 |
|
||
|
Change in fair value of interest rate swaps |
|
- |
|
6,284 |
|
||
|
Management equity units expense, excluding expense related to the Sale |
|
2,306 |
|
1,349 |
|
||
|
Gain on repurchase of long-term debt |
|
(6,026) |
|
- |
|
||
|
Gain on sale of assets, net |
|
(322) |
|
(10,871) |
|
||
|
Facility closure and curtailment costs |
|
1,968 |
|
1,965 |
|
||
|
Loss on sale of note receivable from related party |
|
- |
|
8,357 |
|
||
|
Other |
|
(1,106) |
|
149 |
|
||
|
Decrease (increase) in working capital, net of acquisitions and dispositions |
|
|
|
|
|
||
|
Receivables |
|
(54,591) |
|
(62,069) |
|
||
|
Inventories |
|
46,114 |
|
39,982 |
|
||
|
Prepaid expenses and other |
|
(2,059) |
|
2,068 |
|
||
|
Accounts payable and accrued liabilities |
|
39,602 |
|
(6,322) |
|
||
|
Pension and other postretirement benefit payments |
|
(28,080) |
|
(20,820) |
|
||
|
Current and deferred income taxes |
|
15 |
|
(969) |
|
||
|
Other |
|
(3,044) |
|
1,396 |
|
||
|
Cash used for operations |
|
(33,105) |
|
(25,363) |
|
||
|
Cash provided by (used for) investment |
|
|
|
|
|
||
|
Proceeds from sale of assets, net of cash contributed |
|
315 |
|
1,269,081 |
|
||
|
Proceeds from sale of shares of equity affiliate |
|
3,032 |
|
- |
|
||
|
Proceeds from sale of note receivable from related party, net |
|
- |
|
52,737 |
|
||
|
Expenditures for property and equipment |
|
(12,932) |
|
(36,748) |
|
||
|
Acquisition of businesses and facilities |
|
(4,598) |
|
- |
|
||
|
Increase in restricted cash |
|
- |
|
(183,290) |
|
||
|
Decrease in restricted cash |
|
- |
|
183,290 |
|
||
|
Other |
|
1,964 |
|
1,556 |
|
||
|
Cash provided by (used for) investment |
|
(12,219) |
|
1,286,626 |
|
||
|
Cash provided by (used for) financing |
|
|
|
|
|
||
|
Issuances of long-term debt |
|
60,000 |
|
240,000 |
|
||
|
Payments of long-term debt |
|
(65,627) |
|
(1,085,563) |
|
||
|
Short-term borrowings |
|
- |
|
(10,500) |
|
||
|
Tax distributions to members |
|
(10,705) |
|
(128,024) |
|
||
|
Repurchase of management equity units |
|
(18) |
|
(28,634) |
|
||
|
Cash paid for termination of interest rate swaps |
|
- |
|
(11,918) |
|
||
|
Other |
|
- |
|
(4,155) |
|
||
|
Cash used for financing |
|
(16,350) |
|
(1,028,794) |
|
||
|
Increase (decrease) in cash and cash equivalents |
|
(61,674) |
|
232,469 |
|
||
|
Balance at beginning of the period |
|
275,803 |
|
57,623 |
|
||
|
Balance at end of the period |
|
$ |
214,129 |
|
$ |
290,092 |
|
- more -
-13-
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 2008 Annual Report on Form 10-K and the company’s Quarterly Report on Form 10-Q for the period ended September 30, 2009. Net income (loss) for all periods presented involved estimates and accruals.
|
(a) |
In June 2009, we closed the lumber manufacturing facility in La Grande, Oregon. For the nine months ended September 30, 2009, and three months ended June 30, 2009, we recorded $3.1 million of expense and $0.9 million of income in “Other (income) expense, net” in the Wood Products segment in our Consolidated Statements of Income (Loss). In addition, for the nine months ended September 30, 2009, and three months ended June 30, 2009, we recorded $5.2 million and $2.6 million of accelerated depreciation in “Depreciation, amortization, and depletion” and for the nine months ended September 30, 2009, we recorded $0.6 million of expenses in “Materials, labor, and other operating expenses” in the Wood Products segment in our Consolidated Statements of Income (Loss). |
|
|
|
|
|
During the three months ended September 30, 2008, we sold our indirect wholly owned subsidiary in Brazil, Boise Cascade do Brasil LTDA., and our indirect wholly owned subsidiary in the United Kingdom, Boise Building Products Limited. Also, we permanently closed our veneer operation in St. Helens, Oregon. Collectively for these items, we recorded $3.7 million and $2.1 million of income in “Other (income) expense, net” in the Wood Products segment in our Consolidated Statements of Loss for the three and nine months ended September 30, 2008. |
|
|
|
|
(b) |
In connection with the sale of our Paper and Packaging & Newsprint assets, and most of our Corporate and Other assets (the Sale), to Boise Inc. (formerly Aldabra 2 Acquisition Corp.), we recorded $(1.7) million and $3.0 million in “Gain (loss) on sale of Paper and Packaging & Newsprint assets” in the Corporate and Other segment in our Consolidated Statements of Loss during the three and nine months ended September 30, 2008. For more information related to the Sale, see the Notes to Consolidated Financial Statements in our Form 10-K for the year ended December 31, 2008. |
|
|
|
|
(c) |
During the three and nine months ended September 30, 2009, we sold 1.2 million Boise Inc. shares and recorded a $1.0 million gain in “Gain on sale of shares of equity affiliate” in our Consolidated Statements of Income (Loss). We contributed substantially all of the cash proceeds from the sale of the shares to our pension plans. |
|
|
|
|
(d) |
In June 2008, we sold a promissory note from Boise Inc. for $52.7 million, after selling expenses, and we recorded an $8.4 million loss on the sale in “Other (income) expense, net” in the Corporate and Other segment in our Consolidated Statement of Loss for the nine months ended September 30, 2008. |
|
|
|
|
(e) |
On March 31, 2009, and September 30, 2008, we concluded that our investment in Boise Inc. met the definition of other than temporarily impaired. Accordingly, we recorded a $43.0 million and $208.1 million charge in “Impairment of investment in equity affiliate” in our Consolidated Statements of Loss. For more information, see the Notes to Unaudited Quarterly Consolidated Financial Statements in our Form 10-Q for the period ended September 30, 2009. |
|
|
|
|
(f) |
The nine months ended September 30, 2008, included $6.3 million of expense related to changes in the fair value of our interest rate swaps, which were terminated in February 2008. |
|
|
|
|
(g) |
The nine months ended September 30, 2009, included a $6.0 million net gain on the repurchase of $11.9 million of senior subordinated notes. |
|
|
|
|
(h) |
The equity interest that we own in Boise Inc. represents a significant continuing involvement. As a result, the Paper and Packaging & Newsprint segment results are included in continuing operations through February 21, 2008. |
|
|
|
|
(i) |
EBITDA represents income (loss) before interest (interest expense, interest income, and change in fair value of interest rate swaps), income taxes, and depreciation, amortization, and depletion. The following table reconciles BC Holdings, L.L.C., net income (loss) to BC Holdings, L.L.C., EBITDA and Boise Cascade, L.L.C., EBITDA for the three months ended September 30, 2009 and 2008, and June 30, 2009: |
- more -
-14-
|
|
|
Three Months Ended |
|
|||||||
|
|
|
September 30 |
|
June 30, |
|
|||||
|
|
|
2009 |
|
2008 |
|
2009 |
|
|||
|
|
|
|
|
|
|
|
|
|||
|
|
|
(unaudited, in thousands) |
|
|||||||
|
|
|
|
|
|||||||
|
BC Holdings, L.L.C., net income (loss) |
|
$ |
26,205 |
|
$ |
(207,640) |
|
$ |
9,311 |
|
|
Interest expense |
|
5,389 |
|
6,263 |
|
6,135 |
|
|||
|
Interest income |
|
(185) |
|
(1,469) |
|
(178) |
|
|||
|
Income tax provision |
|
72 |
|
391 |
|
68 |
|
|||
|
Depreciation, amortization, and depletion |
|
9,627 |
|
8,751 |
|
11,448 |
|
|||
|
BC Holdings, L.L.C., EBITDA |
|
41,108 |
|
(193,704) |
|
26,784 |
|
|||
|
Loss on sale of note receivable from related party |
|
- |
|
44 |
|
- |
|
|||
|
Equity in net income of affiliate |
|
(28,225) |
|
(2,148) |
|
(30,306) |
|
|||
|
Gain on sale of shares of equity affiliate |
|
(997) |
|
- |
|
- |
|
|||
|
Impairment of investment in equity affiliate |
|
- |
|
208,074 |
|
- |
|
|||
|
Boise Cascade, L.L.C., EBITDA |
|
$ |
11,886 |
|
$ |
12,266 |
|
$ |
(3,522) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table reconciles BC Holdings, L.L.C., net loss to BC Holdings, L.L.C., EBITDA and Boise Cascade, L.L.C., EBITDA for the nine months ended September 30, 2009 and 2008: |
||||||||||
|
|
|
|
|
|
|
|
|
|||
|
|
|
Nine Months Ended |
|
|
|
|||||
|
|
|
September 30 |
|
|
|
|||||
|
|
|
2009 |
|
2008 |
|
|
|
|||
|
|
|
|
|
|
|
|
|
|||
|
|
|
(unaudited, in thousands) |
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|||
|
BC Holdings, L.L.C., net loss |
|
$ |
(52,665) |
|
$ |
(247,474) |
|
|
|
|
|
Change in fair value of interest rate swaps |
|
- |
|
6,284 |
|
|
|
|||
|
Interest expense |
|
17,140 |
|
28,071 |
|
|
|
|||
|
Interest income |
|
(760) |
|
(6,629) |
|
|
|
|||
|
Income tax provision |
|
623 |
|
1,523 |
|
|
|
|||
|
Depreciation, amortization, and depletion |
|
32,194 |
|
27,470 |
|
|
|
|||
|
BC Holdings, L.L.C., EBITDA |
|
(3,468) |
|
(190,755) |
|
|
|
|||
|
Loss on sale of note receivable from related party |
|
- |
|
8,357 |
|
|
|
|||
|
Equity in net (income) loss of affiliate |
|
(61,536) |
|
15,249 |
|
|
|
|||
|
Gain on sale of shares of equity affiliate |
|
(997) |
|
- |
|
|
|
|||
|
Impairment of investment in equity affiliate |
|
43,039 |
|
208,074 |
|
|
|
|||
|
Boise Cascade, L.L.C., EBITDA |
|
$ |
(22,962) |
|
$ |
40,925 |
|
|
|
|