|
Common stock, par value $0.01 per share
|
|
The NASDAQ Stock Market LLC
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(Title of each class)
|
|
(Name of exchange on which registered)
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Large accelerated filer
|
o
|
Accelerated filer
|
x
|
Non-accelerated filer
|
o
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
o
|
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 1B.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
Item 5
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
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||
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Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
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||
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|
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Item 15.
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||
|
•
|
the state of the homebuilding industry and repair and remodeling activity, the economy and the credit markets;
|
•
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seasonality and cyclicality of the building products supply and services industry;
|
•
|
competitive industry pressures and competitive pricing pressure from our customers and competitors;
|
•
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inflation or deflation of prices of our products;
|
•
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our exposure to product liability, warranty, casualty, construction defect, contract, tort, employment and other claims and legal proceedings;
|
•
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our ability to maintain profitability;
|
•
|
our concentration of business in the Texas, California and Georgia markets;
|
•
|
the potential negative impacts from the recent significant decline in oil prices on employment, home construction and remodeling activity in Texas (particularly the Houston metropolitan area) and other markets dependent on the energy industry;
|
•
|
our ability to retain our key employees and to attract and retain new qualified employees, while controlling our labor costs;
|
•
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product shortages, loss of key suppliers or failure to develop relationships with qualified suppliers, and our dependence on third-party suppliers and manufacturers;
|
•
|
the implementation of our supply chain and technology initiatives;
|
•
|
the impact of long-term non-cancelable leases at our facilities;
|
•
|
our ability to effectively manage inventory and working capital;
|
•
|
the credit risk from our customers;
|
•
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the impact of pricing pressure from our customers;
|
•
|
our ability to identify or respond effectively to consumer needs, expectations or trends;
|
•
|
our ability to successfully implement our growth strategy;
|
•
|
the impact of federal, state, local and other laws and regulations;
|
•
|
the potential loss of significant customers;
|
•
|
natural or man-made disruptions to our distribution and manufacturing facilities;
|
•
|
our exposure to environmental liabilities and subjection to environmental laws and regulation;
|
•
|
cybersecurity risks;
|
•
|
risks related to the integration of Building Materials Holding Corporation with and into our business and successful operation of the post-merger company;
|
•
|
our ability to retain qualified employees following the merger with Building Materials Holding Corporation, while controlling labor costs;
|
•
|
our ability to operate on multiple Enterprise Resource Planning ("ERP") information systems and the subsequent conversion to a single system;
|
•
|
the impact of additional indebtedness assumed through the merger with Building Materials Holding Corporation; and
|
•
|
the various financial covenants in our secured credit agreement and senior secured notes indenture.
|
•
|
the volatility of lumber prices;
|
•
|
the cyclical nature of the homebuilding industry;
|
•
|
general economic conditions in the markets in which we compete;
|
•
|
the pricing policies of our competitors;
|
•
|
the production schedules of our customers; and
|
•
|
the effects of weather.
|
•
|
integrate BMC into the Company successfully (see “Risks Related to the Merger with Building Materials Holding Corporation” below for risk factors related to the Merger;
|
•
|
grow our revenue through organic growth or through acquisitions;
|
•
|
improve our revenue mix by investing (including through acquisitions) in businesses that provide higher gross margins than we have been able to generate historically;
|
•
|
achieve improvements in purchasing or maintain or increase our rebates from suppliers through our supplier consolidation and/or low-cost country initiatives;
|
•
|
improve our gross margins through the utilization of improved pricing practices and technology and sourcing savings;
|
•
|
maintain or reduce our overhead and support expenses as we grow;
|
•
|
effectively evaluate future inventory reserves;
|
•
|
collect monies owed from customers;
|
•
|
maintain relationships with our significant customers; and
|
•
|
integrate any businesses acquired.
|
•
|
managing a larger post-Merger company;
|
•
|
consolidating corporate and administrative infrastructures;
|
•
|
difficulties attracting and retaining key personnel;
|
•
|
loss of customers and suppliers and inability to attract new customers and suppliers;
|
•
|
issues in integrating information technology, communications and other systems;
|
•
|
incompatibility of purchasing, logistics, marketing, administration and other systems and processes; and
|
•
|
unforeseen and unexpected liabilities related to the Merger or BMC’s legacy business.
|
•
|
costs of implementation that materially exceed our expectations;
|
•
|
diversion of management’s attention away from normal daily business operations;
|
•
|
risk of incurring asset impairment charges, accelerated depreciation expense or other charges related to the early retirement of information system assets or the early termination of information system supplier agreements;
|
•
|
increased demand on our operations support personnel;
|
•
|
delays in the go-live of one or more of the stages of the project, resulting in additional costs or time for completion;
|
•
|
errors in implementation resulting in errors in the commencement or reporting of business transactions;
|
•
|
failure in the deliverables of our key partners, suppliers and implementation advisors, resulting in an inferior product, reduced business efficacy and the project not providing expected benefits;
|
•
|
deficiencies in the training of employees in the use of the new solution, resulting in errors in the recording of data or transactions, leading to delays in input deliveries and production impairment;
|
•
|
a control failure during or post implementation, which may result in a material weakness in our internal controls over financial reporting; and
|
•
|
other implementation issues leading to delays and impacts on our business.
|
•
|
our operating and financial performance and prospects;
|
•
|
our quarterly or annual earnings or those of other companies in our industry;
|
•
|
the public’s reaction to our press releases, our other public announcements and our filings with the SEC;
|
•
|
changes in, or failure to meet, earnings estimates or recommendations by research analysts who track our common stock or the stock of other companies in our industry;
|
•
|
the failure of research analysts to cover our common stock;
|
•
|
general economic, industry and market conditions;
|
•
|
strategic actions by us, our customers or our competitors, such as acquisitions or restructurings;
|
•
|
new laws or regulations or new interpretations of existing laws or regulations applicable to our business;
|
•
|
changes in accounting standards, policies, guidance, interpretations or principles;
|
•
|
material litigation or government investigations;
|
•
|
changes in general conditions in the United States and global economies or financial markets, including those resulting from war, incidents of terrorism or responses to such events;
|
•
|
changes in key personnel;
|
•
|
sales of common stock by us, our principal stockholder or members of our management team;
|
•
|
the granting or exercise of employee stock options;
|
•
|
payment of liabilities for which we are self-insured;
|
•
|
volume of trading in our common stock;
|
•
|
threats to, or impairments of, our intellectual property; and
|
•
|
the impact of the factors described elsewhere in “Risk Factors.”
|
•
|
the seasonal and cyclical nature of the homebuilding industry;
|
•
|
the highly competitive nature of our industry;
|
•
|
the volatility of prices, availability and affordability of raw materials, including lumber, wood products and other building products;
|
•
|
shortages of skilled and technical labor, increased labor costs and labor disruptions;
|
•
|
the production schedules of our customers;
|
•
|
general economic conditions, including but not limited to housing starts, repair and remodeling activity and light commercial construction, inventory levels of new and existing homes for sale, foreclosure rates, interest rates, unemployment rates, relative currency values, mortgage availability and pricing, as well as other consumer financing mechanisms, that ultimately affect demand for our products;
|
•
|
actions of suppliers, customers and competitors, including merger and acquisition activities, plant closures and financial failures;
|
•
|
litigation, claims and investigations involving us;
|
•
|
the financial condition and creditworthiness of our customers;
|
•
|
cost of compliance with government laws and regulations;
|
•
|
weather patterns; and
|
•
|
severe weather phenomena such as drought, hurricanes, tornadoes and fire.
|
•
|
a classified Board with three-year staggered terms;
|
•
|
the ability of our Board to issue shares of preferred stock and to determine the price and other terms, including preferences and voting rights, of those shares without stockholder approval;
|
•
|
stockholder action can only be taken at a special or regular meeting and not by written consent;
|
•
|
advance notice procedures for nominating candidates to our Board or presenting matters at stockholder meetings;
|
•
|
removal of directors only for cause;
|
•
|
allowing only our Board to fill vacancies on our Board; and
|
•
|
super-majority voting requirements to amend our amended and restated bylaws and certain provisions of our amended and restated certificate of incorporation (the "Charter").
|
|
|
|
|
|
Facility Use
|
||||||
State
|
Total # of Properties
|
|
Approximate Aggregate Square Footage of Buildings (millions)
|
|
Distribution Operations
|
|
Millwork Fabrication
|
|
Structural Components Fabrication
|
|
Flooring Operations
|
Arkansas
|
1
|
|
0.17
|
|
1
|
|
1
|
|
|
|
1
|
California
|
24
|
|
0.75
|
|
15
|
|
5
|
|
5
|
|
|
Colorado
|
9
|
|
0.61
|
|
5
|
|
4
|
|
2
|
|
|
Florida
|
1
|
|
0.02
|
|
1
|
|
|
|
|
|
|
Georgia
|
17
|
|
1.05
|
|
9
|
|
6
|
|
3
|
|
|
Idaho
|
6
|
|
0.22
|
|
5
|
|
2
|
|
2
|
|
|
Maryland
|
2
|
|
0.01
|
|
|
|
|
|
|
|
2
|
Montana
|
5
|
|
0.23
|
|
2
|
|
2
|
|
2
|
|
|
Nevada
|
1
|
|
0.03
|
|
1
|
|
|
|
1
|
|
|
New Mexico
|
3
|
|
0.10
|
|
2
|
|
1
|
|
1
|
|
|
North Carolina
|
15
|
|
1.34
|
|
8
|
|
3
|
|
3
|
|
5
|
Pennsylvania
|
1
|
|
0.17
|
|
1
|
|
|
|
1
|
|
1
|
South Carolina
|
7
|
|
0.33
|
|
4
|
|
1
|
|
1
|
|
2
|
Texas
|
31
|
|
2.82
|
|
18
|
|
11
|
|
8
|
|
|
Utah
|
13
|
|
0.55
|
|
11
|
|
6
|
|
3
|
|
|
Virginia
|
7
|
|
0.35
|
|
4
|
|
3
|
|
1
|
|
2
|
Washington
|
4
|
|
0.36
|
|
4
|
|
2
|
|
2
|
|
|
Corporate and Branch Support Offices
|
3
|
|
0.11
|
|
|
|
|
|
|
|
|
Total
|
150
|
|
9.22
|
|
91
|
|
47
|
|
35
|
|
13
|
|
|
High
|
|
Low
|
2015
|
|
|
|
|
First quarter
|
|
$18.15
|
|
$13.58
|
Second quarter
|
|
$25.20
|
|
$16.47
|
Third quarter
|
|
$19.84
|
|
$17.05
|
Fourth quarter
|
|
$19.62
|
|
$14.45
|
2014
|
|
|
|
|
First quarter
|
|
$23.33
|
|
$16.56
|
Second quarter
|
|
$20.83
|
|
$16.26
|
Third quarter
|
|
$20.98
|
|
$14.50
|
Fourth quarter
|
|
$16.90
|
|
$13.40
|
|
Year Ended December 31,
|
||||||||||||||||||
(in thousands, expect per share data)
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Statement of operations data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
$
|
1,576,746
|
|
|
$
|
1,311,498
|
|
|
$
|
1,210,156
|
|
|
$
|
886,740
|
|
|
$
|
644,414
|
|
Gross profit
|
361,410
|
|
|
295,074
|
|
|
256,547
|
|
|
180,047
|
|
|
131,475
|
|
|||||
Selling, general and administrative expenses
|
306,843
|
|
|
229,316
|
|
|
200,588
|
|
|
173,382
|
|
|
135,151
|
|
|||||
Net (loss) income
|
(4,831
|
)
|
|
94,032
|
|
|
21,655
|
|
|
(17,533
|
)
|
|
(35,041
|
)
|
|||||
Net (loss) income per share - diluted
|
$
|
(0.12
|
)
|
|
$
|
2.39
|
|
|
$
|
0.56
|
|
|
$
|
(0.47
|
)
|
|
$
|
(0.99
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Statement of cash flows data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating activities (1)
|
$
|
743
|
|
|
$
|
30,732
|
|
|
$
|
15,357
|
|
|
$
|
(38,020
|
)
|
|
$
|
(25,561
|
)
|
Investing activities
|
(135,076
|
)
|
|
(16,262
|
)
|
|
(63,999
|
)
|
|
9,323
|
|
|
11,691
|
|
|||||
Financing activities (1)
|
72,160
|
|
|
(424
|
)
|
|
96,098
|
|
|
28,045
|
|
|
(7,352
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Other financial data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization
|
$
|
24,589
|
|
|
$
|
15,457
|
|
|
$
|
13,767
|
|
|
$
|
13,248
|
|
|
$
|
16,509
|
|
Capital expenditures
|
31,319
|
|
|
28,275
|
|
|
15,057
|
|
|
10,222
|
|
|
7,615
|
|
|||||
Adjusted EBITDA (2)
|
86,042
|
|
|
77,269
|
|
|
64,751
|
|
|
21,113
|
|
|
2,441
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance sheet data (at period end):
|
|
|
|
|
|
|
|
|
|
||||||||||
Total current assets
|
$
|
613,960
|
|
|
$
|
358,095
|
|
|
$
|
323,262
|
|
|
$
|
193,742
|
|
|
$
|
135,711
|
|
Property and equipment, net of accumulated depreciation
|
295,978
|
|
|
140,435
|
|
|
122,930
|
|
|
105,083
|
|
|
105,923
|
|
|||||
Total assets
|
1,376,008
|
|
|
588,512
|
|
|
468,272
|
|
|
320,513
|
|
|
277,579
|
|
|||||
Total debt and capital lease obligations (including current portion)
|
431,709
|
|
|
270,108
|
|
|
265,743
|
|
|
150,929
|
|
|
120,233
|
|
|||||
Total stockholders' equity
|
628,932
|
|
|
179,078
|
|
|
82,229
|
|
|
56,057
|
|
|
71,779
|
|
(1)
|
Net cash provided by (used in) operating and financing activities for the years ended December 31, 2014, 2013 and 2012 reflect the reclassification of changes in book overdrafts from a financing activity to an operating activity. See the section entitled "Reclassifications" in Note 2 to our audited financial statements included elsewhere in this Annual Report on Form 10-K.
|
(2)
|
Adjusted EBITDA is defined as income (loss) from continuing operations plus interest expense, income tax expense (benefit), depreciation and amortization, impairment of assets held for sale, Merger-related costs, restructuring expense, inventory step-up charges, non-cash stock compensation expense, acquisition costs, headquarters relocation costs, insurance deductible reserve adjustments, loss portfolio transfer costs and other items. Adjusted EBITDA is intended as a supplemental measure of our performance that is not required by, or presented in accordance with, U.S. generally accepted accounting principles (“GAAP”). We believe that Adjusted EBITDA provides useful information to management and investors regarding certain financial and business trends relating to our financial condition and operating results. Our management uses Adjusted EBITDA to compare our performance to that of prior periods for trend analyses, for purposes of determining management incentive compensation and for budgeting and planning purposes. Adjusted EBITDA is used in monthly financial reports prepared for management and our Board. We believe that the use of Adjusted EBITDA provides additional tools for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with other distribution and retail companies, which may present similar non-GAAP financial measures to investors. However, our calculation of Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies. Our management does not consider Adjusted EBITDA in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of Adjusted EBITDA is that it excludes significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. Some of these limitations are: (i) Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; (ii) Adjusted EBITDA does not reflect our interest expense, or the requirements necessary to service interest or principal payments on our debt; (iii) Adjusted EBITDA does not reflect our income tax expenses or the cash requirements to pay our taxes; (iv) Adjusted EBITDA does not reflect historical cash expenditures or future requirements for capital expenditure or contractual commitments; (v) although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future and Adjusted EBITDA does not reflect any cash requirements for such replacements and (vi) Adjusted EBITDA does not consider the potentially dilutive impact of issuing non-cash stock-based compensation. In order to compensate for these limitations, management presents Adjusted EBITDA in conjunction with GAAP results. You should review the reconciliation of income (loss) from continuing operations to Adjusted EBITDA below, and should not rely on any single financial measure to evaluate our business.
|
|
Year Ended December 31,
|
||||||||||||||||||
(in thousands)
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
Net (loss) income
|
$
|
(4,831
|
)
|
|
$
|
94,032
|
|
|
$
|
21,655
|
|
|
$
|
(17,533
|
)
|
|
$
|
(35,041
|
)
|
Interest expense
|
27,552
|
|
|
27,090
|
|
|
18,786
|
|
|
14,159
|
|
|
14,333
|
|
|||||
Income tax expense (benefit)
|
(9,689
|
)
|
|
(65,577
|
)
|
|
6,273
|
|
|
(6
|
)
|
|
(99
|
)
|
|||||
Depreciation and amortization
|
24,589
|
|
|
15,457
|
|
|
13,767
|
|
|
13,248
|
|
|
16,509
|
|
|||||
Impairment of assets held for sale
|
—
|
|
|
134
|
|
|
73
|
|
|
1,098
|
|
|
3,064
|
|
|||||
Merger-related costs
|
22,993
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Restructuring expense
|
—
|
|
|
—
|
|
|
—
|
|
|
631
|
|
|
2,324
|
|
|||||
Inventory step-up charges (a)
|
10,285
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Non-cash stock compensation expense
|
2,749
|
|
|
3,410
|
|
|
2,425
|
|
|
2,054
|
|
|
2,565
|
|
|||||
Headquarters relocation (b)
|
3,865
|
|
|
2,054
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Insurance deductible reserve adjustments and casualty fire loss (c)
|
3,026
|
|
|
669
|
|
|
1,772
|
|
|
7,462
|
|
|
(1,214
|
)
|
|||||
Loss portfolio transfer (d)
|
2,826
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Acquisition costs and other items (e)
|
2,677
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Adjusted EBITDA
|
$
|
86,042
|
|
|
$
|
77,269
|
|
|
$
|
64,751
|
|
|
$
|
21,113
|
|
|
$
|
2,441
|
|
(a)
|
Represents expense incurred in relation to the sell-through of SBS inventory which was stepped up in value in connection with the Merger.
|
(b)
|
Represents expenses to relocate BMC's headquarters to Atlanta, Georgia.
|
(c)
|
Represents (i) for the years 2011-2015, adjustments to deductible reserves for workers' compensation, general liability, automobile and construction claims incurred prior to BMC's restructuring and (ii) for 2015, a casualty loss related to a fire at one of the Company’s facilities during 2015.
|
(d)
|
Represents premium and brokerage fees paid to a reinsurer for their assumption of the insurance deductible reserves relating to workers' compensation claims incurred for claim years from 2006 through 2011.
|
(e)
|
Primarily represents costs related to: (i) evaluation of acquisition candidates; (ii) due diligence costs paid to professional service firms; and (iii) other acquisition related expenditures.
|
|
|
Year Ended December 31,
|
|||||||||||||||||||
|
|
2015 Versus 2014
|
|
2015 Average Price
|
|
2014 Versus 2013
|
|
2014 Average Price
|
|
2013 Versus 2012
|
|
2013 Average Price
|
|||||||||
Change in framing lumber prices
|
|
(14
|
)%
|
|
$
|
330
|
|
|
—
|
%
|
|
$
|
383
|
|
|
19
|
%
|
|
$
|
384
|
|
Change in structural panel prices
|
|
(5
|
)%
|
|
$
|
365
|
|
|
(10
|
)%
|
|
$
|
385
|
|
|
11
|
%
|
|
$
|
426
|
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||||||||
(in thousands)
|
Net Sales
|
|
% of Sales
|
|
% Change vs. 2014
|
|
Net Sales
|
|
% of Sales
|
|
% Change vs. 2013
|
|
Net Sales
|
|
% of Sales
|
|||||||||||
Single-family home builders
|
$
|
1,258,938
|
|
|
79.8
|
%
|
|
20.4
|
%
|
|
$
|
1,045,806
|
|
|
79.7
|
%
|
|
7.1
|
%
|
|
$
|
976,113
|
|
|
80.7
|
%
|
Remodeling contractors
|
135,184
|
|
|
8.6
|
%
|
|
17.4
|
%
|
|
115,144
|
|
|
8.8
|
%
|
|
12.5
|
%
|
|
102,387
|
|
|
8.5
|
%
|
|||
Other (including multi-family & light commercial)
|
182,624
|
|
|
11.6
|
%
|
|
21.3
|
%
|
|
150,548
|
|
|
11.5
|
%
|
|
14.3
|
%
|
|
131,656
|
|
|
10.8
|
%
|
|||
Total net sales
|
$
|
1,576,746
|
|
|
100.0
|
%
|
|
20.2
|
%
|
|
$
|
1,311,498
|
|
|
100.0
|
%
|
|
8.4
|
%
|
|
$
|
1,210,156
|
|
|
100.0
|
%
|
|
|
Year Ended December 31,
|
|||||||||||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||
Net sales
|
|
$
|
1,576,746
|
|
|
100.0
|
%
|
|
$
|
1,311,498
|
|
|
100.0
|
%
|
|
$
|
1,210,156
|
|
|
100.0
|
%
|
Cost of goods sold
|
|
1,215,336
|
|
|
77.1
|
%
|
|
1,016,424
|
|
|
77.5
|
%
|
|
953,609
|
|
|
78.8
|
%
|
|||
Gross profit
|
|
361,410
|
|
|
22.9
|
%
|
|
295,074
|
|
|
22.5
|
%
|
|
256,547
|
|
|
21.2
|
%
|
|||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Selling, general and administrative expenses
|
|
306,843
|
|
|
19.5
|
%
|
|
229,316
|
|
|
17.5
|
%
|
|
200,588
|
|
|
16.6
|
%
|
|||
Depreciation expense
|
|
15,700
|
|
|
1.0
|
%
|
|
11,492
|
|
|
0.9
|
%
|
|
9,168
|
|
|
0.8
|
%
|
|||
Amortization expense
|
|
3,626
|
|
|
0.2
|
%
|
|
—
|
|
|
0.0
|
%
|
|
1,310
|
|
|
0.1
|
%
|
|||
Impairment of assets held for sale
|
|
—
|
|
|
0.0
|
%
|
|
134
|
|
|
0.0
|
%
|
|
73
|
|
|
0.0
|
%
|
|||
Merger-related costs
|
|
22,993
|
|
|
1.5
|
%
|
|
—
|
|
|
0.0
|
%
|
|
—
|
|
|
0.0
|
%
|
|||
Income from operations
|
|
12,248
|
|
|
0.8
|
%
|
|
54,132
|
|
|
4.1
|
%
|
|
45,408
|
|
|
3.8
|
%
|
|||
Other income (expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Interest expense
|
|
(27,552
|
)
|
|
(1.7
|
)%
|
|
(27,090
|
)
|
|
(2.1
|
)%
|
|
(18,786
|
)
|
|
(1.6
|
)%
|
|||
Other income (expense), net
|
|
784
|
|
|
0.0
|
%
|
|
1,413
|
|
|
0.1
|
%
|
|
1,306
|
|
|
0.1
|
%
|
|||
(Loss) income before income taxes
|
|
(14,520
|
)
|
|
(0.9
|
)%
|
|
28,455
|
|
|
2.2
|
%
|
|
27,928
|
|
|
2.3
|
%
|
|||
Income tax (benefit) expense
|
|
(9,689
|
)
|
|
(0.6
|
)%
|
|
(65,577
|
)
|
|
(5.0
|
)%
|
|
6,273
|
|
|
0.5
|
%
|
|||
Net (loss) income
|
|
$
|
(4,831
|
)
|
|
(0.3
|
)%
|
|
$
|
94,032
|
|
|
7.2
|
%
|
|
$
|
21,655
|
|
|
1.8
|
%
|
|
|
2015
|
|
2014
|
|
|
|||||||||||
(in thousands)
|
|
Net Sales
|
|
% of Sales
|
|
Net Sales
|
|
% of Sales
|
|
% Change
|
|||||||
Structural components
|
|
$
|
249,371
|
|
|
15.8
|
%
|
|
$
|
205,036
|
|
|
15.6
|
%
|
|
21.6
|
%
|
Lumber & sheet goods
|
|
459,446
|
|
|
29.1
|
%
|
|
428,084
|
|
|
32.6
|
%
|
|
7.3
|
%
|
||
Millwork, doors & windows
|
|
442,675
|
|
|
28.1
|
%
|
|
328,063
|
|
|
25.0
|
%
|
|
34.9
|
%
|
||
Other building products & services
|
|
425,254
|
|
|
27.0
|
%
|
|
350,315
|
|
|
26.8
|
%
|
|
21.4
|
%
|
||
Total net sales
|
|
$
|
1,576,746
|
|
|
100.0
|
%
|
|
$
|
1,311,498
|
|
|
100.0
|
%
|
|
20.2
|
%
|
•
|
selling, general and administrative expenses
increased
$77.5 million
, or
33.8%
, to
$306.8 million
, or
19.5%
of net sales, from
$229.3 million
, or
17.5%
of net sales, for the year ended
December 31, 2014
. Approximately $44.1 million of this increase related to the operations of Legacy SBS, VNS and RBI, while $30.3 million related to Legacy BMC existing operations. The increase in SG&A related to Legacy BMC existing operations was driven primarily by higher salary, wage, benefit and other variable costs to serve higher sales volume, increased insurance costs, headquarters relocation costs and third party costs associated with the acquisitions of VNS and RBI.
|
•
|
depreciation expense
increased
$4.2 million
, or
36.6%
, to
$15.7 million
from
$11.5 million
during the year ended
December 31, 2014
, primarily as a result of fixed assets acquired through the Merger and acquisitions of VNS and RBI, as well as replacements and additions of delivery fleet, material handling equipment and operating equipment.
|
•
|
amortization expense was
$3.6 million
compared to $0 in the prior year. The amortization expense recognized in 2015 relates to intangible assets acquired through the Merger and acquisitions of VNS and RBI.
|
•
|
the Company incurred
$23.0 million
of Merger-related costs which primarily included third-party advisory, legal, accounting and other professional fees and severance costs.
|
|
|
2014
|
|
2013
|
|
|
|||||||||||
(in thousands)
|
|
Net Sales
|
|
% of Sales
|
|
Net Sales
|
|
% of Sales
|
|
% Change
|
|||||||
Structural components
|
|
$
|
205,036
|
|
|
15.6
|
%
|
|
$
|
190,626
|
|
|
15.8
|
%
|
|
7.6
|
%
|
Lumber & sheet goods
|
|
428,084
|
|
|
32.6
|
%
|
|
419,436
|
|
|
34.7
|
%
|
|
2.1
|
%
|
||
Millwork, doors & windows
|
|
328,063
|
|
|
25.0
|
%
|
|
278,704
|
|
|
23.0
|
%
|
|
17.7
|
%
|
||
Other building products & services
|
|
350,315
|
|
|
26.8
|
%
|
|
321,390
|
|
|
26.5
|
%
|
|
9.0
|
%
|
||
Total net sales
|
|
$
|
1,311,498
|
|
|
100.0
|
%
|
|
$
|
1,210,156
|
|
|
100.0
|
%
|
|
8.4
|
%
|
•
|
selling, general and administrative expenses
increased
$28.7 million
, or
14.3%
, to
$229.3 million
, or
17.5%
of net sales, from
$200.6 million
, or
16.6%
of net sales, for the year ended
December 31, 2013
. This increase was was driven primarily by higher salary, wage, incentive compensation costs and other variable costs to serve higher sales volume, costs associated with implementation of Legacy BMC's ERP system and costs associated with relocating the Company's headquarters from Boise, Idaho to Atlanta, Georgia.
|
•
|
depreciation expense
increased
$2.3 million
, or
25.3%
, to
$11.5 million
from
$9.2 million
during the year ended
December 31, 2013
, driven primarily by replacements and addition of delivery fleet and handling equipment.
|
•
|
amortization expense
decreased
to $0 from
$1.3 million
for the year ended
December 31, 2013
, due primarily to full amortization of certain intangible assets in 2013.
|
(in thousands)
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
Accounts receivable, net
|
|
$
|
303,176
|
|
|
$
|
126,652
|
|
Inventories, net
|
|
243,960
|
|
|
104,538
|
|
||
Other current assets
|
|
54,345
|
|
|
21,527
|
|
||
Income taxes receivable
|
|
11,390
|
|
|
6,010
|
|
||
Total current liabilities
|
|
(278,307
|
)
|
|
(122,513
|
)
|
||
Total adjusted working capital*
|
|
334,564
|
|
|
136,214
|
|
||
Cash and cash equivalents
|
|
1,089
|
|
|
63,262
|
|
||
Restricted assets
|
|
—
|
|
|
36,106
|
|
||
Total net current assets
|
|
$
|
335,653
|
|
|
$
|
235,582
|
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net (loss) income
|
|
$
|
(4,831
|
)
|
|
$
|
94,032
|
|
|
$
|
21,655
|
|
Non-cash expenses
|
|
40,392
|
|
|
21,535
|
|
|
17,625
|
|
|||
Gain on sale of property, equipment and real estate
|
|
(497
|
)
|
|
(804
|
)
|
|
(772
|
)
|
|||
Change in deferred income taxes
|
|
(5,892
|
)
|
|
(70,492
|
)
|
|
—
|
|
|||
Change in working capital and other
|
|
(28,429
|
)
|
|
(13,539
|
)
|
|
(23,151
|
)
|
|||
Net cash provided by operating activities
|
|
$
|
743
|
|
|
$
|
30,732
|
|
|
$
|
15,357
|
|
•
|
Net income
declined
by
$98.9 million
to a net loss as discussed in “Operating Results” above.
|
•
|
Non-cash expenses
increased
by
$18.9 million
primarily as a result of increases in depreciation and amortization expense, which was driven primarily by fixed assets and intangible assets acquired through the Merger and acquisitions of VNS and RBI.
|
•
|
Change in deferred income taxes
declined
by
$64.6 million
due primarily to the reversal of $75.2 million of valuation allowance against deferred tax assets during 2014 and the Company's adoption of a tax position related to IRC section 382 limitations which increased its deferred tax assets by $8.1 million during 2015.
|
•
|
Cash outflows from working capital and other relate primarily to increases in accounts receivable and inventory in relation to higher sales volume, offset by increases to accounts payable.
|
•
|
Net income
increased
by
$72.4 million
as discussed in “Operating Results” above.
|
•
|
Non-cash expenses
increased
by
$3.9 million
primarily as a result of an increase in depreciation expense related primarily to additions and replacement of delivery and handling equipment to handle higher sales volume and an increase in amortization of deferred loan costs related to costs incurred with a refinancing in September 2013.
|
•
|
Change in deferred income taxes
increased
by
$70.5 million
due primarily to the reversal of $75.2 million of valuation allowances against deferred tax assets during 2014.
|
•
|
Cash outflows from working capital and other relate primarily to increases in accounts receivable and inventory in relation to higher sales volume, offset by increases to accounts payable.
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Purchases of property, equipment and real estate
|
|
$
|
(31,319
|
)
|
|
$
|
(28,275
|
)
|
|
$
|
(15,057
|
)
|
Cash acquired in the Merger
|
|
6,342
|
|
|
—
|
|
|
—
|
|
|||
Purchases of businesses, net of cash acquired
|
|
(149,485
|
)
|
|
(236
|
)
|
|
(6,705
|
)
|
|||
Change in restricted assets
|
|
36,106
|
|
|
10,326
|
|
|
(46,432
|
)
|
|||
Other investing activities
|
|
3,280
|
|
|
1,923
|
|
|
4,195
|
|
|||
Net cash used in investing activities
|
|
$
|
(135,076
|
)
|
|
$
|
(16,262
|
)
|
|
$
|
(63,999
|
)
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net proceeds from (repayments of) Revolver
|
|
$
|
84,546
|
|
|
$
|
—
|
|
|
$
|
(40,000
|
)
|
Proceeds from Senior Notes, net of original issue discount
|
|
—
|
|
|
—
|
|
|
248,778
|
|
|||
Principal payments on subordinate term notes
|
|
—
|
|
|
—
|
|
|
(102,825
|
)
|
|||
Debt issuance costs
|
|
(3,567
|
)
|
|
(10
|
)
|
|
(10,785
|
)
|
|||
Borrowings under other notes
|
|
2,491
|
|
|
9,991
|
|
|
3,660
|
|
|||
Payments on capital leases and other notes
|
|
(10,623
|
)
|
|
(9,812
|
)
|
|
(4,822
|
)
|
|||
Other financing activities, net
|
|
(687
|
)
|
|
(593
|
)
|
|
2,092
|
|
|||
Net cash provided by (used in) financing activities
|
|
$
|
72,160
|
|
|
$
|
(424
|
)
|
|
$
|
96,098
|
|
|
|
Payments Due by Period
|
||||||||||||||||||
(in millions)
|
|
Total
|
|
2016
|
|
2017-2018
|
|
2019-2020
|
|
Thereafter
|
||||||||||
Revolver obligations (1)
|
|
$
|
152.6
|
|
|
$
|
0.3
|
|
|
$
|
152.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Senior Notes obligations (2)
|
|
311.9
|
|
|
22.5
|
|
|
289.4
|
|
|
—
|
|
|
—
|
|
|||||
Capital lease obligations (3)
|
|
26.4
|
|
|
8.3
|
|
|
10.7
|
|
|
4.5
|
|
|
2.9
|
|
|||||
Other long-term debt (4)
|
|
6.3
|
|
|
2.8
|
|
|
3.2
|
|
|
0.3
|
|
|
—
|
|
|||||
Operating lease obligations (5)
|
|
137.8
|
|
|
27.5
|
|
|
41.9
|
|
|
27.4
|
|
|
41.0
|
|
|||||
Purchase commitments (6)
|
|
7.8
|
|
|
5.8
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|||||
Earnout obligations (7)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
|
$
|
642.8
|
|
|
$
|
67.2
|
|
|
$
|
499.5
|
|
|
$
|
32.2
|
|
|
$
|
43.9
|
|
(1)
|
Represents principal of $152.3 million and interest payments outstanding on our Revolver of $0.3 million as of December 31, 2015, based on interest rates in effect on December 31, 2015, which ranged from 1.7% to 4.0%. To the extent that a decrease in eligible accounts receivable, credit card receivables and inventory reduces the maximum availability under the Revolver below the amount then outstanding, amounts outstanding could become due sooner than reflected in the table. The Revolver matures at the earlier of December 1, 2020 or the date that is three months prior to the maturity date of the Senior Notes. For purposes of this table, we have assumed a maturity date three months prior to the maturity date of the Senior Notes, or June 2018. For further information, refer to Note 9 to our audited financial statements included elsewhere in this Annual Report on Form 10-K.
|
(2)
|
Represents principal of $250.0 million and semi-annual interest payments at a 9.0% interest rate. The Senior Notes mature in September 2018. For further information, refer to Note 9 to our audited financial statements included elsewhere in this Annual Report on Form 10-K.
|
(3)
|
Represents payments under our capital leases for real estate, fleet vehicles and various equipment. For further information, refer to Note 12 to our audited financial statements included elsewhere in this Annual Report on Form 10-K.
|
(4)
|
Represents payments on term notes secured by delivery and handling equipment with various maturities through April 2019 and a term note secured by real property which matures in March 2021. The interest rates on these notes range from 4.6% to 8.4%. For further information, refer to Note 9 to our audited financial statements included elsewhere in this Annual Report on Form 10-K.
|
(5)
|
Represents payments under our operating leases, primarily for buildings, improvements and equipment. For further information, refer to Note 12 to our audited financial statements included elsewhere in this Annual Report on Form 10-K.
|
(6)
|
Consists primarily of obligations to purchase vehicles which are enforceable and legally binding on us and a commitment for a subscription for our enterprise resource planning software. Excludes purchase orders made in the ordinary course of business that are short-term or cancellable.
|
(7)
|
SBS acquired the assets of Total Building Services Group, LLC ("TBSG") in 2012. As part of the acquisition, SBS entered into an earnout agreement ("Earnout") in which the seller of TBSG participates in earnings over certain thresholds during the three fiscal years beginning January 1, 2013. The Company advanced $0.9 million against future Earnout payments and earns 9% interest on the advanced amount. As of December 31, 2015, the net value of the Earnout and related advance was $0.
|
•
|
the volatility of lumber prices;
|
•
|
the cyclical nature of the homebuilding industry;
|
•
|
general economic conditions in the markets in which we compete;
|
•
|
the pricing policies of our competitors;
|
•
|
the production schedules of our customers; and
|
•
|
the effects of weather.
|
•
|
Fair value of common stock.
We use quoted market prices to determine the fair value of our common stock.
|
•
|
Dividend yield.
We have never declared or paid any cash dividends on our common stock and do not presently plan to pay cash dividends in the foreseeable future. Consequently, we used an expected dividend yield of zero.
|
•
|
Volatility
. The expected price volatility for our common stock was estimated by taking the median historic price volatility for industry peers.
|
•
|
Risk-free interest rate.
The risk-free interest rate is based on the yields of United States Treasury securities with maturities similar to the expected term of the options.
|
•
|
Expected term.
The expected term was estimated to be the mid-point between the vesting date and the expiration date of the award. We believe use of this approach is appropriate as we have limited prior history of option exercises upon which to base an expected term.
|
|
|
2015
|
|
Expected dividend yield
|
|
0
|
%
|
Expected volatility factor
|
|
0.44
|
|
Risk-free interest rate
|
|
0.0176
|
|
Expected term (in years)
|
|
6.0
|
|
|
|
December 31,
2015 |
|
December 31,
2014 |
||||
(in thousands, except share and per share amounts)
|
|
|
|
|
||||
Assets
|
|
|
|
|
||||
Current assets
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,089
|
|
|
$
|
63,262
|
|
Restricted assets
|
|
—
|
|
|
36,106
|
|
||
Accounts receivables, net of allowances
|
|
303,176
|
|
|
126,652
|
|
||
Inventories, net
|
|
243,960
|
|
|
104,538
|
|
||
Costs in excess of billings on uncompleted contracts
|
|
22,528
|
|
|
7,623
|
|
||
Income taxes receivable
|
|
11,390
|
|
|
6,010
|
|
||
Prepaid expenses and other current assets
|
|
31,817
|
|
|
13,904
|
|
||
Total current assets
|
|
613,960
|
|
|
358,095
|
|
||
Property and equipment, net of accumulated depreciation
|
|
295,978
|
|
|
140,435
|
|
||
Deferred financing costs
|
|
9,464
|
|
|
8,243
|
|
||
Deferred income taxes
|
|
—
|
|
|
70,492
|
|
||
Customer relationship intangible assets, net of accumulated amortization
|
|
177,036
|
|
|
—
|
|
||
Other intangible assets, net of accumulated amortization
|
|
10,900
|
|
|
—
|
|
||
Goodwill
|
|
254,664
|
|
|
1,137
|
|
||
Other long-term assets
|
|
14,006
|
|
|
10,110
|
|
||
Total assets
|
|
$
|
1,376,008
|
|
|
$
|
588,512
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
135,632
|
|
|
$
|
46,278
|
|
Accrued expenses and other liabilities
|
|
91,888
|
|
|
40,186
|
|
||
Billings in excess of costs on uncompleted contracts
|
|
15,888
|
|
|
7,470
|
|
||
Interest payable
|
|
6,882
|
|
|
6,713
|
|
||
Current portion:
|
|
|
|
|
||||
Long-term debt and capital lease obligation
|
|
10,129
|
|
|
7,546
|
|
||
Insurance deductible reserves
|
|
17,888
|
|
|
14,320
|
|
||
Total current liabilities
|
|
278,307
|
|
|
122,513
|
|
||
Insurance deductible reserves
|
|
37,334
|
|
|
24,337
|
|
||
Long-term debt
|
|
405,085
|
|
|
255,288
|
|
||
Long-term portion of capital lease obligation
|
|
16,495
|
|
|
7,274
|
|
||
Deferred income taxes
|
|
3,021
|
|
|
—
|
|
||
Other long-term liabilities
|
|
6,834
|
|
|
22
|
|
||
Total liabilities
|
|
747,076
|
|
|
409,434
|
|
||
Commitments and contingencies (Note 12)
|
|
|
|
|
||||
Stockholders' equity
|
|
|
|
|
||||
Common stock, $0.01 par value, 300.0 million shares and 104.6 million authorized, 65.4 million and 39.5 million shares issued, and 65.3 million and 39.0 million outstanding at December 31, 2015 and December 31, 2014, respectively
|
|
654
|
|
|
395
|
|
||
Additional paid-in capital
|
|
626,402
|
|
|
174,203
|
|
||
Retained earnings
|
|
2,302
|
|
|
7,133
|
|
||
Treasury stock, at cost, less than 0.1 million and 0.5 million shares at December 31, 2015 and December 31, 2014, respectively
|
|
(426
|
)
|
|
(2,653
|
)
|
||
Total stockholders' equity
|
|
628,932
|
|
|
179,078
|
|
||
Total liabilities and stockholders' equity
|
|
$
|
1,376,008
|
|
|
$
|
588,512
|
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands, except per share amounts)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net sales
|
|
|
|
|
|
|
||||||
Building products
|
|
$
|
1,146,190
|
|
|
$
|
937,048
|
|
|
$
|
850,669
|
|
Construction services
|
|
430,556
|
|
|
374,450
|
|
|
359,487
|
|
|||
|
|
1,576,746
|
|
|
1,311,498
|
|
|
1,210,156
|
|
|||
Cost of sales
|
|
|
|
|
|
|
||||||
Building products
|
|
864,485
|
|
|
705,812
|
|
|
648,274
|
|
|||
Construction services
|
|
350,851
|
|
|
310,612
|
|
|
305,335
|
|
|||
|
|
1,215,336
|
|
|
1,016,424
|
|
|
953,609
|
|
|||
Gross profit
|
|
361,410
|
|
|
295,074
|
|
|
256,547
|
|
|||
|
|
|
|
|
|
|
||||||
Selling, general and administrative expenses
|
|
306,843
|
|
|
229,316
|
|
|
200,588
|
|
|||
Depreciation expense
|
|
15,700
|
|
|
11,492
|
|
|
9,168
|
|
|||
Amortization expense
|
|
3,626
|
|
|
—
|
|
|
1,310
|
|
|||
Impairment of assets held for sale
|
|
—
|
|
|
134
|
|
|
73
|
|
|||
Merger-related costs
|
|
22,993
|
|
|
—
|
|
|
—
|
|
|||
|
|
349,162
|
|
|
240,942
|
|
|
211,139
|
|
|||
Income from operations
|
|
12,248
|
|
|
54,132
|
|
|
45,408
|
|
|||
Other income (expenses)
|
|
|
|
|
|
|
||||||
Interest expense
|
|
(27,552
|
)
|
|
(27,090
|
)
|
|
(18,786
|
)
|
|||
Other income (expense), net
|
|
784
|
|
|
1,413
|
|
|
1,306
|
|
|||
(Loss) income before income taxes
|
|
(14,520
|
)
|
|
28,455
|
|
|
27,928
|
|
|||
Income tax (benefit) expense
|
|
(9,689
|
)
|
|
(65,577
|
)
|
|
6,273
|
|
|||
Net (loss) income
|
|
$
|
(4,831
|
)
|
|
$
|
94,032
|
|
|
$
|
21,655
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding
|
|
|
|
|
|
|
||||||
Basic
|
|
41,260
|
|
|
38,828
|
|
|
38,321
|
|
|||
Diluted
|
|
41,260
|
|
|
39,291
|
|
|
38,865
|
|
|||
|
|
|
|
|
|
|
||||||
Net (loss) income per common share
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
(0.12
|
)
|
|
$
|
2.42
|
|
|
$
|
0.57
|
|
Diluted
|
|
$
|
(0.12
|
)
|
|
$
|
2.39
|
|
|
$
|
0.56
|
|
|
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-in Capital
|
|
Retained Earnings (Deficit)
|
|
Total
|
||||||||||||||||
(in thousands)
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|||||||||||||||
Stockholders' equity as of December 31, 2012
|
|
37,768
|
|
|
$
|
378
|
|
|
454
|
|
|
$
|
(797
|
)
|
|
$
|
165,030
|
|
|
$
|
(108,554
|
)
|
|
$
|
56,057
|
|
Shares vested for long-term incentive plan
|
|
1,405
|
|
|
14
|
|
|
(16
|
)
|
|
24
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|||||
Shares repurchased
|
|
—
|
|
|
—
|
|
|
46
|
|
|
(461
|
)
|
|
—
|
|
|
—
|
|
|
(461
|
)
|
|||||
Stock compensation expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,425
|
|
|
—
|
|
|
2,425
|
|
|||||
Tax benefits related to stock based compensation plans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,553
|
|
|
—
|
|
|
2,553
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,655
|
|
|
21,655
|
|
|||||
Stockholders' equity as of December 31, 2013
|
|
39,173
|
|
|
392
|
|
|
484
|
|
|
(1,234
|
)
|
|
169,970
|
|
|
(86,899
|
)
|
|
82,229
|
|
|||||
Shares vested for long-term incentive plan
|
|
282
|
|
|
3
|
|
|
(126
|
)
|
|
188
|
|
|
(191
|
)
|
|
—
|
|
|
—
|
|
|||||
Shares repurchased
|
|
—
|
|
|
—
|
|
|
124
|
|
|
(1,607
|
)
|
|
—
|
|
|
—
|
|
|
(1,607
|
)
|
|||||
Stock compensation expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,410
|
|
|
—
|
|
|
3,410
|
|
|||||
Tax benefits related to stock based compensation plans
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,014
|
|
|
—
|
|
|
1,014
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
94,032
|
|
|
94,032
|
|
|||||
Stockholders' equity as of December 31, 2014
|
|
39,455
|
|
|
395
|
|
|
482
|
|
|
(2,653
|
)
|
|
174,203
|
|
|
7,133
|
|
|
179,078
|
|
|||||
Effect of reverse merger
|
|
26,186
|
|
|
262
|
|
|
—
|
|
|
—
|
|
|
453,128
|
|
|
—
|
|
|
453,390
|
|
|||||
Cancellation of Legacy BMC treasury stock in connection with the Merger
|
|
(434
|
)
|
|
(4
|
)
|
|
(434
|
)
|
|
3,487
|
|
|
(3,483
|
)
|
|
—
|
|
|
—
|
|
|||||
Shares vested for long-term incentive plans
|
|
153
|
|
|
1
|
|
|
(126
|
)
|
|
194
|
|
|
(195
|
)
|
|
—
|
|
|
—
|
|
|||||
Shares repurchased
|
|
—
|
|
|
—
|
|
|
103
|
|
|
(1,454
|
)
|
|
—
|
|
|
—
|
|
|
(1,454
|
)
|
|||||
Stock compensation expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,749
|
|
|
—
|
|
|
2,749
|
|
|||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,831
|
)
|
|
(4,831
|
)
|
|||||
Stockholders' equity as of December 31, 2015
|
|
65,360
|
|
|
$
|
654
|
|
|
25
|
|
|
$
|
(426
|
)
|
|
$
|
626,402
|
|
|
$
|
2,302
|
|
|
$
|
628,932
|
|
BMC STOCK HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||||||
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
|
||||||
Net (loss) income
|
|
$
|
(4,831
|
)
|
|
$
|
94,032
|
|
|
$
|
21,655
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities
|
|
|
|
|
|
|
||||||
Depreciation expense
|
|
20,963
|
|
|
15,457
|
|
|
12,457
|
|
|||
Amortization of intangible assets
|
|
3,626
|
|
|
—
|
|
|
1,310
|
|
|||
Amortization of deferred loan costs
|
|
2,525
|
|
|
2,277
|
|
|
1,303
|
|
|||
Amortization of original issue discount
|
|
244
|
|
|
257
|
|
|
57
|
|
|||
Amortization of inventory step-up charges
|
|
10,285
|
|
|
—
|
|
|
—
|
|
|||
Deferred income taxes
|
|
(5,892
|
)
|
|
(70,492
|
)
|
|
—
|
|
|||
Non-cash stock compensation expense
|
|
2,749
|
|
|
3,410
|
|
|
2,425
|
|
|||
Impairment of assets held for sale
|
|
—
|
|
|
134
|
|
|
73
|
|
|||
Gain on sale of property, equipment and real estate
|
|
(497
|
)
|
|
(804
|
)
|
|
(772
|
)
|
|||
Change in assets and liabilities, net of effects of acquisitions
|
|
|
|
|
|
|
||||||
Accounts receivable, net of allowances
|
|
(24,061
|
)
|
|
(6,299
|
)
|
|
(10,680
|
)
|
|||
Inventories, net
|
|
(16,452
|
)
|
|
(15,927
|
)
|
|
(14,028
|
)
|
|||
Costs in excess of billings on uncompleted contracts
|
|
(4,026
|
)
|
|
276
|
|
|
(1,554
|
)
|
|||
Other current assets
|
|
(9,378
|
)
|
|
(9,163
|
)
|
|
(3,743
|
)
|
|||
Other long-term assets
|
|
1,240
|
|
|
(1,688
|
)
|
|
453
|
|
|||
Accounts payable
|
|
873
|
|
|
9,666
|
|
|
3,777
|
|
|||
Accrued expenses and other liabilities
|
|
4,377
|
|
|
1,633
|
|
|
18,810
|
|
|||
Billings in excess of costs on uncompleted contracts
|
|
8,360
|
|
|
1,776
|
|
|
(343
|
)
|
|||
Interest on subordinate note
|
|
—
|
|
|
—
|
|
|
(16,840
|
)
|
|||
Insurance deductible reserves
|
|
7,973
|
|
|
6,165
|
|
|
997
|
|
|||
Other long-term liabilities
|
|
2,665
|
|
|
22
|
|
|
—
|
|
|||
Net cash provided by operating activities
|
|
743
|
|
|
30,732
|
|
|
15,357
|
|
|||
Cash flows from investing activities
|
|
|
|
|
|
|
||||||
Change in restricted assets
|
|
36,106
|
|
|
10,326
|
|
|
(46,432
|
)
|
|||
Cash acquired in the Merger
|
|
6,342
|
|
|
—
|
|
|
—
|
|
|||
Purchases of businesses, net of cash acquired
|
|
(149,485
|
)
|
|
(236
|
)
|
|
(6,705
|
)
|
|||
Purchases of property, equipment and real estate
|
|
(31,319
|
)
|
|
(28,275
|
)
|
|
(15,057
|
)
|
|||
Proceeds from sale of property, equipment and real estate
|
|
3,280
|
|
|
1,919
|
|
|
4,554
|
|
|||
Other investing activities
|
|
—
|
|
|
4
|
|
|
(359
|
)
|
|||
Net cash used in investing activities
|
|
(135,076
|
)
|
|
(16,262
|
)
|
|
(63,999
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
|
||||||
Proceeds from revolving line of credit
|
|
293,183
|
|
|
—
|
|
|
338,618
|
|
|||
Repayments of proceeds from revolving line of credit
|
|
(208,637
|
)
|
|
—
|
|
|
(378,618
|
)
|
|||
Proceeds from notes, net of original issue discount
|
|
—
|
|
|
—
|
|
|
248,778
|
|
|||
Principal payments on subordinate term note
|
|
—
|
|
|
—
|
|
|
(102,825
|
)
|
|||
Borrowings under other notes
|
|
2,491
|
|
|
9,991
|
|
|
3,660
|
|
|||
Principal payments on other notes
|
|
(6,081
|
)
|
|
(5,999
|
)
|
|
(2,415
|
)
|
BMC STOCK HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||||||||||
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Secured borrowings
|
|
$
|
767
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Tax benefits related to stock based compensation
|
|
—
|
|
|
1,014
|
|
|
2,553
|
|
|||
Purchase of treasury stock
|
|
(1,454
|
)
|
|
(1,607
|
)
|
|
(461
|
)
|
|||
Payments for debt issuance costs
|
|
(3,567
|
)
|
|
(10
|
)
|
|
(10,785
|
)
|
|||
Payments on capital lease obligations
|
|
(4,542
|
)
|
|
(3,813
|
)
|
|
(2,407
|
)
|
|||
Net cash provided by (used in) financing activities
|
|
72,160
|
|
|
(424
|
)
|
|
96,098
|
|
|||
Net (decrease) increase in cash and cash equivalents
|
|
(62,173
|
)
|
|
14,046
|
|
|
47,456
|
|
|||
Cash and cash equivalents
|
|
|
|
|
|
|
||||||
Beginning of period
|
|
63,262
|
|
|
49,216
|
|
|
1,760
|
|
|||
End of period
|
|
$
|
1,089
|
|
|
$
|
63,262
|
|
|
$
|
49,216
|
|
|
|
|
|
|
|
|
||||||
Supplemental disclosure of cash flow information
|
|
|
|
|
|
|
||||||
Interest paid
|
|
$
|
23,970
|
|
|
$
|
24,351
|
|
|
$
|
27,859
|
|
Cash paid (received) for income taxes, net
|
|
4,310
|
|
|
12,917
|
|
|
1,025
|
|
|||
Non-cash investing and financing transactions
|
|
|
|
|
|
|
||||||
Accrued purchases of property and equipment
|
|
1,968
|
|
|
—
|
|
|
—
|
|
|||
Assets acquired under capital lease obligations
|
|
2,342
|
|
|
3,929
|
|
|
9,966
|
|
|||
Consideration transferred in connection with the Merger
|
|
453,390
|
|
|
—
|
|
|
—
|
|
Level 1
|
|
Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.
|
|
|
|
Level 2
|
|
Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.
|
|
|
|
Level 3
|
|
Inputs are unobservable inputs which reflect the reporting entity’s own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information.
|
Buildings and improvements
|
|
10–30 years
|
Leasehold improvements
|
|
Lesser of life of the asset or remaining
|
|
|
lease term, and not to exceed 15 years
|
Furniture, fixtures and equipment
|
|
2–10 years
|
Vehicles
|
|
4–10 years
|
•
|
$7.1 million
of vendor rebate and marketing receivables, which were previously included in "Receivables, net of allowances" on the consolidated balance sheet as of December 31, 2014, were reclassified to "Prepaid expenses and other current assets."
|
•
|
$2.8 million
of cash advances from customers, which were previously included in "Accounts payable" on the consolidated balance sheet as of December 31, 2014, were reclassified to "Accrued expenses and other liabilities."
|
•
|
$19.8 million
of accrued compensation, which was previously shown separately as a line called "Accrued compensation" on the consolidated balance sheet as of December 31, 2014, was reclassified to "Accrued expenses and other liabilities."
|
|
Year ended December 31, 2014, as previously presented
|
Reclassification amount
|
Year ended December 31, 2014, as reclassified
|
|
Year ended December 31, 2013, as previously presented
|
Reclassification amount
|
Year ended December 31, 2013, as reclassified
|
||||||||||||
Net cash provided by operating activities
|
$
|
27,681
|
|
$
|
3,051
|
|
$
|
30,732
|
|
|
$
|
21,154
|
|
$
|
(5,797
|
)
|
$
|
15,357
|
|
Net cash provided by (used in) financing activities
|
2,627
|
|
(3,051
|
)
|
(424
|
)
|
|
90,301
|
|
5,797
|
|
96,098
|
|
|
|
Pro Forma Year Ended December 31,
|
||||||
(in thousands)
|
|
2015
|
|
2014
|
||||
Net sales
|
|
$
|
2,890,163
|
|
|
$
|
2,819,398
|
|
Net income
|
|
15,098
|
|
|
56,710
|
|
||
Basic net income per share
|
|
0.23
|
|
|
0.87
|
|
||
Diluted net income per share
|
|
0.23
|
|
|
0.86
|
|
(in thousands)
|
|
2015
|
|
2014
|
||||
Trade receivables
|
|
$
|
311,932
|
|
|
$
|
128,672
|
|
Allowance for doubtful accounts
|
|
(2,357
|
)
|
|
(1,560
|
)
|
||
Other allowances
|
|
(6,399
|
)
|
|
(460
|
)
|
||
|
|
$
|
303,176
|
|
|
$
|
126,652
|
|
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Balance at January 1
|
|
$
|
1,560
|
|
|
$
|
1,259
|
|
|
$
|
1,722
|
|
Write-offs
|
|
(558
|
)
|
|
(488
|
)
|
|
(342
|
)
|
|||
Recoveries
|
|
236
|
|
|
139
|
|
|
116
|
|
|||
Increase (decrease) in allowance
|
|
1,119
|
|
|
650
|
|
|
(237
|
)
|
|||
Balance at December 31
|
|
$
|
2,357
|
|
|
$
|
1,560
|
|
|
$
|
1,259
|
|
(in thousands)
|
|
2015
|
|
2014
|
||||
Land
|
|
$
|
58,757
|
|
|
$
|
39,284
|
|
Buildings and improvements
|
|
90,429
|
|
|
61,451
|
|
||
Leasehold improvements
|
|
10,934
|
|
|
1,486
|
|
||
Furniture, fixtures and equipment
|
|
115,861
|
|
|
50,251
|
|
||
Vehicles
|
|
87,307
|
|
|
44,819
|
|
||
Construction-in-progress
|
|
16,349
|
|
|
8,478
|
|
||
|
|
379,637
|
|
|
205,769
|
|
||
Less: Accumulated depreciation
|
|
(83,659
|
)
|
|
(65,334
|
)
|
||
|
|
$
|
295,978
|
|
|
$
|
140,435
|
|
(in thousands)
|
|
|
||
December 31, 2012
|
|
$
|
—
|
|
Acquisition of Western Building Supply
|
|
1,137
|
|
|
December 31, 2013 and 2014
|
|
1,137
|
|
|
Acquisition of VNS Corporation
|
|
9,287
|
|
|
Acquisition of Robert Bowden, Inc.
|
|
44,541
|
|
|
Merger with Stock Building Supply Holdings, Inc.
|
|
199,699
|
|
|
December 31, 2015
|
|
$
|
254,664
|
|
|
Trademarks
|
|
Customer Relationships
|
|
Non-Compete Agreements
|
|
|
||||||||||||||||||||
|
Gross
|
|
|
|
Gross
|
|
|
|
Gross
|
|
|
|
|
||||||||||||||
|
Carrying
|
|
Accumulated
|
|
Carrying
|
|
Accumulated
|
|
Carrying
|
|
Accumulated
|
|
|
||||||||||||||
(in thousands)
|
Amount
|
|
Amortization
|
|
Amount
|
|
Amortization
|
|
Amount
|
|
Amortization
|
|
Total
|
||||||||||||||
December 31, 2014
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Acquisition of VNS
|
850
|
|
|
—
|
|
|
10,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10,850
|
|
|||||||
Acquisition of RBI
|
—
|
|
|
—
|
|
|
39,900
|
|
|
—
|
|
|
400
|
|
|
—
|
|
|
40,300
|
|
|||||||
Acquisition of SBS
|
4,500
|
|
|
—
|
|
|
129,800
|
|
|
—
|
|
|
6,112
|
|
|
—
|
|
|
140,412
|
|
|||||||
Amortization
|
—
|
|
|
(408
|
)
|
|
—
|
|
|
(2,664
|
)
|
|
—
|
|
|
(554
|
)
|
|
(3,626
|
)
|
|||||||
December 31, 2015
|
$
|
5,350
|
|
|
$
|
(408
|
)
|
|
$
|
179,700
|
|
|
$
|
(2,664
|
)
|
|
$
|
6,512
|
|
|
$
|
(554
|
)
|
|
$
|
187,936
|
|
(in thousands)
|
|
2015
|
|
2014
|
||||
Accrued payroll and other employee related expenses
|
|
$
|
42,776
|
|
|
$
|
19,780
|
|
Accrued taxes
|
|
19,744
|
|
|
8,996
|
|
||
Advances from customers
|
|
10,133
|
|
|
2,830
|
|
||
Accrued lending fees
|
|
2,520
|
|
|
—
|
|
||
Accrued professional fees
|
|
2,442
|
|
|
399
|
|
||
Accrued rebates payable
|
|
1,840
|
|
|
1,439
|
|
||
Accrued warranty reserve
|
|
1,762
|
|
|
1,452
|
|
||
Unfavorable leases
|
|
789
|
|
|
—
|
|
||
Other
|
|
9,882
|
|
|
5,290
|
|
||
|
|
$
|
91,888
|
|
|
$
|
40,186
|
|
(in thousands)
|
|
December 31, 2015
|
|
December 31, 2014
|
||||
Revolving credit agreement
|
|
$
|
152,260
|
|
|
$
|
—
|
|
Senior secured notes
|
|
250,000
|
|
|
250,000
|
|
||
Other
|
|
6,266
|
|
|
9,856
|
|
||
|
|
408,526
|
|
|
259,856
|
|
||
Unamortized original issue discount
|
|
(664
|
)
|
|
(907
|
)
|
||
|
|
407,862
|
|
|
258,949
|
|
||
Less: Current portion of long-term debt
|
|
2,777
|
|
|
3,661
|
|
||
|
|
$
|
405,085
|
|
|
$
|
255,288
|
|
(in thousands)
|
|
2015
|
|
2014
|
||||
Unfavorable leases
|
|
$
|
3,696
|
|
|
$
|
—
|
|
Long-term severance reserve
|
|
1,986
|
|
|
—
|
|
||
Long-term deferred rent
|
|
774
|
|
|
22
|
|
||
Other
|
|
378
|
|
|
—
|
|
||
|
|
$
|
6,834
|
|
|
$
|
22
|
|
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Current
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
(4,202
|
)
|
|
$
|
3,765
|
|
|
$
|
5,358
|
|
State
|
|
405
|
|
|
1,150
|
|
|
915
|
|
|||
|
|
(3,797
|
)
|
|
4,915
|
|
|
6,273
|
|
|||
Deferred
|
|
|
|
|
|
|
||||||
Federal
|
|
(4,176
|
)
|
|
(69,281
|
)
|
|
—
|
|
|||
State
|
|
(1,716
|
)
|
|
(1,211
|
)
|
|
—
|
|
|||
|
|
(5,892
|
)
|
|
(70,492
|
)
|
|
—
|
|
|||
|
|
$
|
(9,689
|
)
|
|
$
|
(65,577
|
)
|
|
$
|
6,273
|
|
|
|
2015
|
|
2014
|
|
2013
|
|||
Federal statutory rate
|
|
35.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State taxes, net of federal tax
|
|
1.7
|
|
|
4.1
|
|
|
4.4
|
|
Nondeductible capitalized transaction costs
|
|
(16.2
|
)
|
|
—
|
|
|
—
|
|
Nondeductible (permanent) items
|
|
(3.0
|
)
|
|
0.6
|
|
|
0.7
|
|
Changes in tax rates
|
|
(6.2
|
)
|
|
—
|
|
|
—
|
|
Changes related to IRC section 382 limitations
|
|
55.5
|
|
|
—
|
|
|
17.6
|
|
Other items
|
|
(0.1
|
)
|
|
(2.6
|
)
|
|
(1.6
|
)
|
Valuation allowance
|
|
—
|
|
|
(267.6
|
)
|
|
(33.6
|
)
|
Effective tax rate
|
|
66.7
|
%
|
|
(230.5
|
)%
|
|
22.5
|
%
|
(in thousands)
|
|
2015
|
|
2014
|
||||
Deferred tax assets related to:
|
|
|
|
|
||||
Accounts receivable
|
|
$
|
3,780
|
|
|
$
|
753
|
|
Inventory
|
|
4,725
|
|
|
1,667
|
|
||
Goodwill and intangibles
|
|
—
|
|
|
22,932
|
|
||
Accrued compensation
|
|
5,462
|
|
|
1,555
|
|
||
Insurance deductible reserves
|
|
14,186
|
|
|
13,496
|
|
||
Stock-based compensation
|
|
2,759
|
|
|
1,240
|
|
||
Restructuring reserves
|
|
4,008
|
|
|
—
|
|
||
Other accrued liabilities
|
|
918
|
|
|
821
|
|
||
Federal net operating loss carryforward
|
|
32,361
|
|
|
30,480
|
|
||
State net operating loss carryforward
|
|
5,036
|
|
|
1,211
|
|
||
Other
|
|
283
|
|
|
404
|
|
||
|
|
73,518
|
|
|
74,559
|
|
||
Valuation allowance
|
|
(126
|
)
|
|
—
|
|
||
Total deferred tax assets
|
|
73,392
|
|
|
74,559
|
|
||
|
|
|
|
|
||||
Deferred tax liabilities related to:
|
|
|
|
|
||||
Goodwill and intangibles
|
|
(32,452
|
)
|
|
(33
|
)
|
||
Property and equipment
|
|
(42,261
|
)
|
|
(2,941
|
)
|
||
Other assets
|
|
(1,700
|
)
|
|
(1,093
|
)
|
||
Total deferred tax liabilities
|
|
(76,413
|
)
|
|
(4,067
|
)
|
||
Net deferred tax (liability) asset
|
|
$
|
(3,021
|
)
|
|
$
|
70,492
|
|
•
|
$48.1 million
in 2028;
|
•
|
$17.3 million
in 2029; and
|
•
|
$27.1 million
, or approximately
$4.8 million
per year, in years 2030 through 2034.
|
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Balance at January 1,
|
|
$
|
—
|
|
|
$
|
75,248
|
|
|
$
|
84,629
|
|
Additions charged to expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Additions charged to Goodwill/Purchase Accounting
|
|
126
|
|
|
—
|
|
|
—
|
|
|||
Deductions - other
|
|
—
|
|
|
(75,248
|
)
|
|
(9,381
|
)
|
|||
Balance at December 31,
|
|
$
|
126
|
|
|
$
|
—
|
|
|
$
|
75,248
|
|
(in thousands)
|
|
2015
|
|
2014
|
||||
Balance at January 1,
|
|
$
|
—
|
|
|
$
|
—
|
|
Tax positions taken in prior periods:
|
|
|
|
|
||||
Gross increases
|
|
—
|
|
|
—
|
|
||
Gross decreases
|
|
—
|
|
|
—
|
|
||
Tax positions taken in current period:
|
|
|
|
|
||||
Gross increases
|
|
3,224
|
|
|
—
|
|
||
Settlements with taxing authorities
|
|
—
|
|
|
—
|
|
||
Lapse of applicable statute of limitations
|
|
—
|
|
|
—
|
|
||
Balance at December 31,
|
|
$
|
3,224
|
|
|
$
|
—
|
|
(in thousands)
|
|
Capital
Leases |
|
Operating
Leases |
|
||||
2016
|
|
$
|
8,270
|
|
|
$
|
27,483
|
|
|
2017
|
|
6,772
|
|
|
22,771
|
|
|
||
2018
|
|
3,936
|
|
|
19,131
|
|
|
||
2019
|
|
2,636
|
|
|
16,397
|
|
|
||
2020
|
|
1,892
|
|
|
11,062
|
|
|
||
Thereafter
|
|
2,929
|
|
|
40,952
|
|
|
||
|
|
26,436
|
|
|
$
|
137,796
|
|
(a)
|
|
Less: Amounts representing interest
|
|
(2,589
|
)
|
|
|
|
|||
Total obligation under capital leases
|
|
23,847
|
|
|
|
|
|||
Less: Current portion of capital lease obligation
|
|
(7,352
|
)
|
|
|
|
|||
Long term capital lease obligation
|
|
$
|
16,495
|
|
|
|
|
Expected dividend yield
|
|
0
|
%
|
Expected volatility factor (a)
|
|
44
|
%
|
Risk-free interest rate (b)
|
|
2
|
%
|
Expected term (in years) (c)
|
|
6.0
|
|
(c)
|
The expected term was derived utilizing the "simplified method" in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 110, which uses the mid-point between the vesting date and the expiration date of the award. We believe use of this approach is appropriate given the lack of prior history of option exercises upon which to base an expected term.
|
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Stock options
|
|
$
|
42
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Restricted stock
|
|
2,607
|
|
|
3,410
|
|
|
2,425
|
|
|||
Restricted stock units
|
|
100
|
|
|
—
|
|
|
—
|
|
|||
Stock based compensation
|
|
$
|
2,749
|
|
|
$
|
3,410
|
|
|
$
|
2,425
|
|
|
|
Restricted Stock
|
|
Restricted Stock Units
|
||||||||||
|
|
Number of Shares Outstanding
(in thousands)
|
|
Weighted Average Grant Date Fair Value
|
|
Number of
Units
Outstanding (in thousands)
|
|
Weighted
Average
Grant Date
Fair Value
|
||||||
December 31, 2012
|
|
1,748
|
|
|
$
|
2.01
|
|
|
—
|
|
|
$
|
—
|
|
Granted
|
|
565
|
|
|
10.19
|
|
|
—
|
|
|
—
|
|
||
Vested
|
|
(1,420
|
)
|
|
1.99
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
December 31, 2013
|
|
893
|
|
|
7.25
|
|
|
—
|
|
|
—
|
|
||
Granted
|
|
264
|
|
|
11.66
|
|
|
—
|
|
|
—
|
|
||
Vested
|
|
(408
|
)
|
|
4.95
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
|
(43
|
)
|
|
8.97
|
|
|
—
|
|
|
—
|
|
||
December 31, 2014
|
|
706
|
|
|
10.15
|
|
|
—
|
|
|
—
|
|
||
Legacy SBS restricted stock units assumed
|
|
—
|
|
|
—
|
|
|
318
|
|
|
16.99
|
|
||
Granted
|
|
206
|
|
|
17.15
|
|
|
—
|
|
|
—
|
|
||
Vested
|
|
(279
|
)
|
|
9.07
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
|
(178
|
)
|
|
11.37
|
|
|
(36
|
)
|
|
16.99
|
|
||
December 31, 2015
|
|
455
|
|
|
$
|
13.51
|
|
|
282
|
|
|
$
|
16.99
|
|
|
|
Number of Options
(in thousands)
|
|
Weighted Average Exercise Price
|
|
Contractual
Term
(in years)
|
|
Intrinsic
Value
(in thousands)
|
|||||
Outstanding at December 31, 2014
|
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Legacy SBS stock options assumed
|
|
1,229
|
|
|
14.18
|
|
|
|
|
|
|||
Granted
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Forfeited
|
|
(1
|
)
|
|
17.04
|
|
|
|
|
|
|||
Expired
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Outstanding at December 31, 2015
|
|
1,228
|
|
|
$
|
14.17
|
|
|
7.9
|
|
$
|
4,470
|
|
|
|
|
|
|
|
|
|
|
|||||
Exercisable at December 31, 2015
|
|
992
|
|
|
$
|
13.49
|
|
|
7.5
|
|
$
|
4,470
|
|
|
|
|
|
|
|
|
|
|
|||||
Vested and expected to vest at December 31, 2015
|
|
1,184
|
|
|
$
|
14.07
|
|
|
7.9
|
|
$
|
4,470
|
|
(in thousands, except period data)
|
|
Unrecognized Compensation Cost
|
|
Weighted Average Remaining Period of Expense Recognition
(in years)
|
||
Stock options
|
|
$
|
1,687
|
|
|
2.8
|
Restricted stock
|
|
2,737
|
|
|
1.2
|
|
Restricted stock units
|
|
4,582
|
|
|
2.8
|
|
|
|
$
|
9,006
|
|
|
|
|
|
Year Ended December 31, 2015
|
|
December 31, 2015
|
||||||||||||||||
(in thousands)
|
|
Net Sales
|
|
Gross Profit
|
|
Depreciation & Amortization
|
|
Adjusted EBITDA
|
|
Total Assets
|
||||||||||
Geographic divisions
|
|
$
|
1,576,746
|
|
|
$
|
361,410
|
|
|
$
|
23,726
|
|
|
$
|
122,914
|
|
|
$
|
1,305,545
|
|
Other reconciling items
|
|
—
|
|
|
—
|
|
|
863
|
|
|
(36,872
|
)
|
|
70,463
|
|
|||||
|
|
$
|
1,576,746
|
|
|
$
|
361,410
|
|
|
$
|
24,589
|
|
|
|
|
$
|
1,376,008
|
|
|
|
Year Ended December 31, 2014
|
|
December 31, 2014
|
||||||||||||||||
(in thousands)
|
|
Net Sales
|
|
Gross Profit
|
|
Depreciation & Amortization
|
|
Adjusted EBITDA
|
|
Total Assets
|
||||||||||
Geographic divisions
|
|
$
|
1,311,498
|
|
|
$
|
295,074
|
|
|
$
|
14,906
|
|
|
$
|
98,933
|
|
|
$
|
487,027
|
|
Other reconciling items
|
|
—
|
|
|
—
|
|
|
551
|
|
|
(21,664
|
)
|
|
101,485
|
|
|||||
|
|
$
|
1,311,498
|
|
|
$
|
295,074
|
|
|
$
|
15,457
|
|
|
|
|
$
|
588,512
|
|
|
|
Year Ended December 31, 2013
|
|
December 31, 2013
|
||||||||||||||||
(in thousands)
|
|
Net Sales
|
|
Gross Profit
|
|
Depreciation & Amortization
|
|
Adjusted EBITDA
|
|
Total Assets
|
||||||||||
Geographic divisions
|
|
$
|
1,210,156
|
|
|
$
|
256,547
|
|
|
$
|
13,156
|
|
|
$
|
84,457
|
|
|
$
|
446,716
|
|
Other reconciling items
|
|
—
|
|
|
—
|
|
|
611
|
|
|
(19,706
|
)
|
|
21,556
|
|
|||||
|
|
$
|
1,210,156
|
|
|
$
|
256,547
|
|
|
$
|
13,767
|
|
|
|
|
$
|
468,272
|
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Income before income taxes
|
|
$
|
(14,520
|
)
|
|
$
|
28,455
|
|
|
$
|
27,928
|
|
Interest expense
|
|
27,552
|
|
|
27,090
|
|
|
18,786
|
|
|||
Depreciation and amortization
|
|
24,589
|
|
|
15,457
|
|
|
13,767
|
|
|||
Impairment of assets held for sale
|
|
—
|
|
|
134
|
|
|
73
|
|
|||
Merger-related costs
|
|
22,993
|
|
|
—
|
|
|
—
|
|
|||
Inventory step-up charges
|
|
10,285
|
|
|
—
|
|
|
—
|
|
|||
Non-cash stock compensation expense
|
|
2,749
|
|
|
3,410
|
|
|
2,425
|
|
|||
Headquarters relocation
|
|
3,865
|
|
|
2,054
|
|
|
—
|
|
|||
Insurance deductible reserve adjustments and casualty fire loss
|
|
3,026
|
|
|
669
|
|
|
1,772
|
|
|||
Loss portfolio transfer
|
|
2,826
|
|
|
—
|
|
|
—
|
|
|||
Acquisition costs and other items
|
|
2,677
|
|
|
—
|
|
|
—
|
|
|||
Adjusted EBITDA of other reconciling items
|
|
36,872
|
|
|
21,664
|
|
|
19,706
|
|
|||
Adjusted EBITDA of geographic divisions reportable segment
|
|
$
|
122,914
|
|
|
$
|
98,933
|
|
|
$
|
84,457
|
|
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
||||||
Structural components
|
|
$
|
249,371
|
|
|
$
|
205,036
|
|
|
$
|
190,626
|
|
Lumber & sheet goods
|
|
459,446
|
|
|
428,084
|
|
|
419,436
|
|
|||
Millwork, doors & windows
|
|
442,675
|
|
|
328,063
|
|
|
278,704
|
|
|||
Other building products & services
|
|
425,254
|
|
|
350,315
|
|
|
321,390
|
|
|||
Total net sales
|
|
$
|
1,576,746
|
|
|
$
|
1,311,498
|
|
|
$
|
1,210,156
|
|
|
|
Year Ended December 31,
|
||||||||||
(in thousands, except per share amounts)
|
|
2015
|
|
2014
|
|
2013
|
||||||
(Loss) income attributable to common stockholders
|
|
$
|
(4,831
|
)
|
|
$
|
94,032
|
|
|
$
|
21,655
|
|
|
|
|
|
|
|
|
||||||
Weighted average common shares outstanding, basic
|
|
41,260
|
|
|
38,828
|
|
|
38,321
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
|
||||||
Restricted stock
|
|
—
|
|
|
463
|
|
|
544
|
|
|||
Weighted average common shares outstanding, diluted
|
|
41,260
|
|
|
39,291
|
|
|
38,865
|
|
|||
|
|
|
|
|
|
|
||||||
Basic (loss) income per share
|
|
$
|
(0.12
|
)
|
|
$
|
2.42
|
|
|
$
|
0.57
|
|
|
|
|
|
|
|
|
||||||
Diluted (loss) income per share
|
|
$
|
(0.12
|
)
|
|
$
|
2.39
|
|
|
$
|
0.56
|
|
|
|
Year Ended December 31,
|
|||||||
(in thousands)
|
|
2015
|
|
2014
|
|
2013
|
|||
Stock options
|
|
1,228
|
|
|
—
|
|
|
—
|
|
Restricted stock
|
|
455
|
|
|
—
|
|
|
—
|
|
Restricted stock units
|
|
282
|
|
|
—
|
|
|
—
|
|
|
|
2015
|
||||||||||||||
(in thousands, except per share amounts)
|
|
First
Quarter |
|
Second
Quarter |
|
Third
Quarter |
|
Fourth
Quarter |
||||||||
Net sales
|
|
$
|
292,826
|
|
|
$
|
357,287
|
|
|
$
|
416,471
|
|
|
$
|
510,162
|
|
Gross profit
|
|
66,697
|
|
|
83,818
|
|
|
97,101
|
|
|
113,794
|
|
||||
Net (loss) income
|
|
(3,561
|
)
|
|
2,125
|
|
|
4,047
|
|
|
(7,442
|
)
|
||||
Basic (loss) income per share
|
|
$
|
(0.09
|
)
|
|
$
|
0.05
|
|
|
$
|
0.10
|
|
|
$
|
(0.16
|
)
|
Diluted (loss) income per share
|
|
$
|
(0.09
|
)
|
|
$
|
0.05
|
|
|
$
|
0.10
|
|
|
$
|
(0.16
|
)
|
|
|
2014
|
||||||||||||||
(in thousands, except per share amounts)
|
|
First
Quarter |
|
Second
Quarter |
|
Third
Quarter |
|
Fourth
Quarter |
||||||||
Net sales
|
|
$
|
289,716
|
|
|
$
|
351,620
|
|
|
$
|
358,314
|
|
|
$
|
311,848
|
|
Gross profit
|
|
61,819
|
|
|
79,491
|
|
|
81,642
|
|
|
72,122
|
|
||||
Net (loss) income
|
|
(1,674
|
)
|
|
84,224
|
|
|
7,532
|
|
|
3,950
|
|
||||
Basic (loss) income per share
|
|
$
|
(0.04
|
)
|
|
$
|
2.17
|
|
|
$
|
0.19
|
|
|
$
|
0.10
|
|
Diluted (loss) income per share
|
|
$
|
(0.04
|
)
|
|
$
|
2.14
|
|
|
$
|
0.19
|
|
|
$
|
0.10
|
|
1.
|
The list of consolidated financial statements and related notes, together with the report of PricewaterhouseCoopers LLP, appear in Part II, Item 8 "Financial Statements and Supplementary Data" of this Annual Report on Form 10-K and are hereby incorporated by reference.
|
2.
|
Financial statement schedules have been omitted because they are not applicable, not material or the required information is otherwise included.
|
3.
|
The following documents are filed, furnished or incorporated by reference as exhibits to this report as required by Item 601 of Regulation S-K.
|
Exhibit No.
|
|
Description
|
2.1
|
|
Restructuring and Investment Agreement, dated as of May 5, 2009, by and among Wolseley Investments North America, Stock Building Supply Holdings, LLC and Saturn Acquisition Holdings, LLC (incorporated by reference to Exhibit 2.1 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
2.2
|
|
Plan of Conversion of Saturn Acquisition Holdings, LLC (incorporated by reference to Exhibit 2.2 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
2.3
|
|
Agreement and Plan of Merger, dated as of June 2, 2015, by and between Stock Building Supply Holdings, Inc. and Building Materials Holding Corporation (incorporated by reference to Exhibit 2.1 to the Form 8-K filed with the SEC on June 5, 2015 in Commission File No. 001-36050)
|
3.1
|
|
Amended and Restated Certificate of Incorporation (incorporated by reference to Annex C to the definitive Joint Proxy and Consent Solicitation Statement/Prospectus filed with the SEC on November 2, 2015 in Commission File No. 333-206421)
|
3.2
|
|
Amended and Restated Bylaws of Stock Building Supply Holdings, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the Commission on August 15, 2013 in Commission File No. 001-36050)
|
4.1
|
|
Form of stock certificate (incorporated by reference to Exhibit 4.1 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
4.2
|
|
Indenture, dated as of September 20, 2013, by and among Building Materials Holding Corporation, the guarantors party thereto and Wilmington Trust, National Association, as trustee, governing Building Materials Holding Corporation’s 9.0% Senior Secured Notes due 2018 (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the Commission on December 7, 2015 in Commission File No. 001-36050)
|
4.3
|
|
First Supplemental Indenture, dated as of June 1, 2015, by and among VNS Corporation, ProCon Construction Services, LLC, TrussMart Building Components, LLC and Wilmington Trust, National Association, as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the Commission on December 7, 2015 in Commission File No. 001-36050)
|
4.4
|
|
Second Supplemental Indenture, dated as of December 1, 2015, by and among BMC Stock Holdings, Inc., certain subsidiaries of BMC Stock Holdings, Inc. parties thereto and Wilmington Trust, National Association, as trustee (incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed with the Commission on December 7, 2015 in Commission File No. 001-36050)
|
10.1
|
|
Amended and Restated Professional Services Agreement, dated as of June 13, 2013, by and between Glendon Partners, Inc. and Stock Building Supply Holdings, Inc. (incorporated by reference to Exhibit 10.11 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
10.2
|
|
Management Services Agreement, dated as of May 4, 2009, by and between The Gores Group, LLC and Saturn Acquisition Holdings, LLC (incorporated by reference to Exhibit 10.12 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
10.3
|
|
Termination of Management Services Agreement, dated as of June 13, 2013, by and between The Gores Group, LLC and Stock Building Supply Holdings, Inc. (incorporated by reference to Exhibit 10.13 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
Exhibit No.
|
|
Description
|
10.4
|
|
Contribution Agreement, dated as of November 16, 2011, by and between Saturn Acquisition Holdings, LLC and Gores Building Holdings, LLC (incorporated by reference to Exhibit 10.14 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
10.5
|
|
Director Nomination Agreement, dated as of August 14, 2013, by and among Stock Building Supply Holdings, Inc. and Gores Building Holdings, LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Commission on August 15, 2013 in Commission File No. 001-36050)
|
10.6
|
|
Employment Agreement Amendment, dated as of June 2, 2015, by and between James F. Major, Jr. and Stock Building Supply Holdings, Inc. (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed with the Commission on June 5, 2015 in Commission File No. 001-36050)
|
10.7
|
|
Employment Agreement Amendment, dated as of June 2, 2015, by and between Lisa M. Hamblet and Stock Building Supply Holdings, Inc. (incorporated by reference to Exhibit 10.5 to the Registrant’s Form 8-K filed with the Commission on June 5, 2015 in Commission File No. 001-36050)
|
10.8
|
|
Employment Agreement Amendment, dated as of June 2, 2015, by and between C. Lowell Ball and Stock Building Supply Holdings, Inc. (incorporated by reference to Exhibit 10.6 to the Registrant’s Form 8-K filed with the Commission on June 5, 2015 in Commission File No. 001-36050)
|
10.9
|
|
Consulting Agreement, effective as of December 1, 2015, by and between BMC Stock Holdings, Inc. and Bryan J. Yeazel (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed with the Commission on December 21, 2015 in Commission File No. 001-36050)
|
10.10
|
|
Form of Indemnification Agreement (incorporated by reference to Exhibit 10.20 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
10.11
|
|
Form of Stock Building Supply Holdings, Inc. 2013 Incentive Compensation Plan (incorporated by reference to Exhibit 10.21 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on June 14, 2013 in Commission File No. 333-189368)
|
10.12
|
|
Amendment to the Stock Building Supply Holdings, Inc. 2013 Incentive Compensation Plan, (incorporated by reference to Annex B to the definitive Joint Proxy and Consent Solicitation Statement/Prospectus filed with the SEC on November 2, 2015 in Commission File No. 333-206421)
|
10.13
|
|
Description of Management Incentive Plan for Executive Officers (incorporated by reference to Exhibit 10.24 to the Registrant's Annual Report on Form 10-K filed with the Commission on March 4, 2014 in Commission File No. 001-36050)
|
10.14
|
|
Form of Nonqualified Stock Option Agreement Pursuant to the Stock Building Supply Holdings, Inc. 2013 Incentive Compensation Plan (incorporated by reference to Exhibit 10.23 to Amendment 2 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on July 29, 2013 in Commission File No. 333-189368)
|
10.15
|
|
Form of Restricted Stock Agreement Pursuant to the Stock Building Supply Holdings, Inc. 2013 Incentive Compensation Plan (incorporated by reference to Exhibit 10.24 to Amendment 2 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on July 29, 2013 in Commission File No. 333-189368)
|
10.16
|
|
Form of Restricted Stock Unit Agreement Pursuant to the Stock Building Supply Holdings, Inc. 2013 Incentive Compensation Plan (incorporated by reference to Exhibit 10.25 to Amendment 2 to the Stock Building Supply Holdings, Inc. Registration Statement on Form S-1, as amended, filed with the Commission on July 29, 2013 in Commission File No. 333-189368)
|
10.17
|
|
Second Amended and Restated Senior Secured Credit Agreement, dated as of December 1, 2015, by and among Building Materials Holding Corporation, Stock Building Supply Holdings, Inc., certain subsidiaries of Building Materials Holding Corporation and Stock Building Supply Holdings, Inc. parties thereto, Wells Fargo Capital Finance, LLC as agent for the lenders, joint lead arranger, and joint book runner, Goldman Sachs Bank USA, as joint lead arranger and joint book runner, and the lenders parties thereto (incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed with the Commission on December 7, 2015 in Commission File No. 001-36050)
|
10.18
|
|
Amendment Number One to Second Amended and Restated Senior Secured Credit Agreement and Consent, dated as of January 28, 2016, by and among BMC Stock Holdings, Inc., as parent, the subsidiaries of parent party thereto, as borrowers, the lenders party thereto, and Wells Fargo Capital Finance, LLC, as agent for the lenders
|
10.19
|
|
Registration Rights Agreement, effective as of December 1, 2015, by and among Stock Building Supply Holdings, Inc. and certain stockholders affiliated with Davidson Kempner Capital Management LP, Robotti & Company Advisors, LLC and The Gores Group, LLC (incorporated by reference to Annex G to the definitive Joint Proxy and Consent Solicitation Statement/Prospectus filed with the SEC on November 2, 2015 in Commission File No. 333-206421)
|
Exhibit No.
|
|
Description
|
16.1
|
|
Letter from KPMG LLP to the U.S. Securities and Exchange Commission (incorporated by reference to Exhibit 16.1 to the Registrant’s Form 8-K filed with the Commission on December 21, 2015 in Commission File No. 001-36050)
|
21.1
|
|
List of subsidiaries of BMC Stock Holdings, Inc.
|
23.1
|
|
Consent of PricewaterhouseCoopers LLP
|
23.2
|
|
Consent of KPMG LLP
|
24.1
|
|
Powers of Attorney (included on the signature page)
|
31.1
|
|
Certification by Peter C. Alexander, President and Chief Executive Officer, pursuant to Exchange Act Rule 13a-14/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2
|
|
Certification by James F. Major, Jr., Executive Vice President, Chief Financial Officer and Treasurer, pursuant to Exchange Act Rule 13a-14/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2
|
|
Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.INS*
|
|
XBRL Instance Document
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
BMC STOCK HOLDINGS, INC.
|
|
Date:
|
March 15, 2016
|
By:
|
/s/ James F. Major, Jr.
|
|
|
|
Executive Vice President, Chief Financial Officer and Treasurer
|
|
|
|
(Principal financial officer and duly authorized officer)
|
Signature
|
Title
|
Date
|
|
|
|
/s/ Peter C. Alexander
|
President and Chief Executive Officer (principal executive officer)
|
March 15, 2016
|
Peter C. Alexander
|
|
|
|
|
|
/s/ James F. Major, Jr.
|
Executive Vice President, Chief Financial Officer and Treasurer (principal financial officer)
|
March 15, 2016
|
James F. Major, Jr.
|
|
|
|
|
|
/s/ Noah Gay
|
Senior Vice President and Chief Accounting Officer (principal accounting officer)
|
March 15, 2016
|
Noah Gay
|
|
|
|
|
|
/s/ David Bullock
|
Director and Chairman of the Board
|
March 15, 2016
|
David Bullock
|
|
|
|
|
|
/s/ Barry J. Goldstein
|
Director
|
March 15, 2016
|
Barry J. Goldstein
|
|
|
|
|
|
/s/ David L. Keltner
|
Director
|
March 15, 2016
|
David L. Keltner
|
|
|
|
|
|
/s/ Michael Miller
|
Director
|
March 15, 2016
|
Michael Miller
|
|
|
|
|
|
/s/ James O'Leary
|
Director
|
March 15, 2016
|
James O'Leary
|
|
|
|
|
|
/s/ Jeffrey G. Rea
|
Director
|
March 15, 2016
|
Jeffrey G. Rea
|
|
|
|
|
|
/s/ Carl R. Vertuca, Jr.
|
Director
|
March 15, 2016
|
Carl R. Vertuca, Jr.
|
|
“Parent”
and
“Guarantor”
BMC STOCK HOLDINGS, INC.
, a Delaware corporation
By:
/s/ Peter Alexander
Name:
Peter Alexander
Title:
Chief Executive Officer
|
|
“
Borrowers
”
|
|
BMC WEST CORPORATION
, a Delaware corporation
By:
/s/ Peter Alexander
Name:
Peter Alexander
Title:
Chief Executive Officer
|
SELECTBUILD CONSTRUCTION, INC.
, a Delaware corporation
By:
/s/ Peter Alexander
Name:
Peter Alexander
Title:
Chief Executive Officer
|
SELECTBUILD SOUTHERN CALIFORNIA, INC.
, a Delaware corporation
By:
/s/ Peter Alexander
Name:
Peter Alexander
Title:
Chief Executive Officer
|
|
|
|
COLEMAN FLOOR, LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
STOCK BUILDING SUPPLY, LLC
, a North Carolina limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
STOCK BUILDING SUPPLY WEST (USA), INC.
, a Delaware corporation
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
STOCK BUILDING SUPPLY MIDWEST
,
LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
STOCK BUILDING SUPPLY WEST, LLC
, a Utah limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
STOCK BUILDING SUPPLY OF ARKANSAS
,
LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
SBS / BISON BUILDING MATERIALS, LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
COLEMAN FLOOR SOUTHEAST, LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
TBSG, LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
SBS GUILFORD, LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
STOCK WINDOW & DOOR SOUTHEAST, LLC
, a Delaware limited liability company
By:
/s/ James F. Major, Jr.
Name:
James F. Major, Jr.
Title:
Executive Vice President and Chief Financial Officer
|
|
“
Agent
” and “
Lender
”
|
|
WELLS FARGO CAPITAL FINANCE, LLC
, a Delaware limited liability company
By:
/s/ Nicholas Ply
Name:
Nicholas Ply
Title:
Vice President
|
|
“
Lender
”
|
|
GOLDMAN SACHS BANK USA
By:
/s/ Jerry Li
Name:
Jerry Li
Title:
Authorized Signatory
|
|
“
Lender
”
|
|
BANK OF AMERICA, N.A.
By:
/s/ Jinea C. Turk
Name:
Jinea C. Turk
Title:
Vice President
|
|
“
Lender
”
|
|
SUNTRUST BANK
By:
/s/ Bryan Van Horn
Name:
Bryan Van Horn
Title:
VP
|
|
“
Lender
”
|
|
MUFG UNION BANK, N.A.
By:
/s/ Todd Eggertsen
Name:
Todd Eggertsen
Title:
Director
|
|
To:
|
Wells Fargo Capital Finance, LLC,
as Agent |
Effective Date of Calculation:
|
_____________
|
|
A. Section 8.19 – Fixed Charge Coverage Ratio
|
|
|
•
From any date that Excess Availability is less than or equal to the greater of (i) $40,000,000, and (ii) 10.0% of the Line Cap until the date that Excess Availability has been greater than the greater of (A) $40,000,000, and (B) 10.0% of the Line Cap for a period of at least 30 consecutive days, Parent and its Subsidiaries shall have a Fixed Charge Coverage Ratio at the end of any fiscal quarter (beginning with the fiscal quarter most recently ended for which financial statements have been delivered to Agent pursuant to
Section 7.01(a)
,
(b)
, or
(c)
prior to the first time Excess Availability is less than or equal to the greater of (x) $40,000,000, and (y) 10.0% of the Line Cap) of at least 1.0:1.0 for the twelve month period then ending.
|
|
___:___
|
2.
In compliance with
Section 8.19
of the Credit Agreement?
|
[Yes/No]
|
1.
|
Borrowers: The Subsidiaries of Building Materials Holding Corporation, a Delaware corporation (“
BMHC
”), and upon the consummation of the Merger, BMC Stock Holdings, Inc., a Delaware corporation (“
BMC Stock
”), as the successor entity pursuant to the Parent Assumption (such merged entity “
Parent
”), identified on the signature pages of the Credit Agreement as “Borrowers” (together with each other Subsidiary that becomes a party to the Credit Agreement as a “Borrower” after the date thereof in accordance with the terms thereof)
|
2.
|
Name and Date of Credit Agreement:
|
|
|
If to Specified Bank Products Provider:
|
________________________
|
|
_________________________
|
|
_________________________
|
|
Attn: ____________________
|
|
Fax No. __________________
|
|
|
Borrowing Base
|
From Schedule A
|
____________________
|
Less:
Revolving Loan Balance
|
|
____________________
|
Letters of Credit Outstanding
|
|
____________________
|
Borrowing Base Availability
|
|
____________________
|
|
|
|
Revolver Availability
|
Lesser of (i) Borrowing Base and (ii)
$450,000,000
(Aggregate Commitment
)
|
____________________
|
Less:
Revolving Loan Balance
|
|
____________________
|
Letters of Credit Outstanding
|
|
____________________
|
Revolver Availability
|
|
____________________
|
Gross Trade Accounts Receivable (other than any Credit Card Receivables)
|
|
__________
|
|
Less: Ineligible Accounts and Applicable Reserves
|
|
__________
|
See Schedule A.1
|
Eligible Accounts
|
|
__________
|
|
Advance Rate
|
|
85%
|
|
|
A.1
|
__________
|
|
|
|
|
|
Eligible Credit Card Receivables Cap
|
|
$10,000,000
|
|
Gross Credit Card Accounts Receivable
|
|
__________
|
|
Less: Ineligible Accounts and Applicable Reserves
|
|
__________
|
See Schedule A.1
|
Eligible Credit Card Receivables
|
|
__________
|
|
Advance Rate
|
|
90%
|
|
|
A.2
|
__________
|
|
|
|
|
|
Accounts Receivable Availability
|
A
|
__________
|
|
|
|
|
|
Eligible Inventory Cap
|
|
60% of Aggregate Commitment
|
|
|
B.1
|
__________
|
|
|
|
|
|
Gross Inventory
|
|
__________
|
|
Less: Ineligible Inventory and Applicable Reserves
|
|
__________
|
See Schedule A.3
|
Eligible Inventory
|
|
__________
|
|
Advance Rate
|
|
70%
|
|
Available Eligible Inventory
|
B.2
|
__________
|
|
|
|
|
|
Eligible Inventory (use the number from above)
|
B.3.a
|
__________
|
|
Net Orderly Liquidation Value from Appraisal
|
B.3.b
|
|
|
Eligible Inventory Orderly Liquidation Value (B.3.a
multiplied by
B.3.b)
|
|
__________
|
|
Advance Rate
|
|
85%
|
|
|
|
__________
|
|
Less: Applicable Reserves
|
|
__________
|
|
Available Eligible Inventory Orderly Liquidation Value
|
B.3
|
__________
|
|
Inventory Availability (the least of B.1, B.2 and B.3)
|
B
|
__________
|
|
|
|
|
|
FILO Availability Cap
|
C.1
|
$50,000,000
|
|
|
|
|
|
Eligible Accounts (use the number from A.1 above)
|
|
__________
|
|
Advance Rate
|
|
5%
|
|
|
C.2
|
__________
|
|
Eligible Inventory (use the number from above)
|
|
__________
|
|
Advance Rate
|
|
5%
|
|
|
C.3
|
__________
|
|
Eligible Inventory Orderly Liquidation Value (use the number from above)
|
|
__________
|
|
Advance Rate
|
|
5%
|
|
|
C.4
|
__________
|
|
|
|
|
|
FILO Availability (the lesser of (1) C.1, and (2) the sum of (x) C.2, and (y) the lesser of (i) C.3 and C.4)
|
C
|
__________
|
|
|
|
|
|
Total Reserves (including the FILO Reserve, if applicable)
|
D
|
__________
|
|
|
|
|
|
Borrowing Base
|
A+B+C-D=E
|
_
|
|
To:
|
Wells Fargo Capital Finance, LLC,
as Agent |
|
State of Incorporation or Organization
|
BMC West Corporation
|
Delaware
|
SelectBuild Construction, Inc.
|
Delaware
|
SelectBuild Southern California, Inc.
|
Delaware
|
BMC Stock Services, LLC
|
Delaware
|
BMC Stock Services B, LLC
|
Delaware
|
Stock Building Supply West, LLC
|
Utah
|
SBS/Bison Building Materials, LLC
|
Delaware
|
Stock Building Supply West (USA), Inc.
|
Delaware
|
Michael Nicholas Carpentry, LLC
|
Illinois
|
Stock Building Supply, LLC
|
North Carolina
|
TBSG, LLC
|
Delaware
|
Coleman Floor, LLC
|
Delaware
|
Coleman Floor Southeast, LLC
|
Delaware
|
Stock Building Supply of Arkansas, LLC
|
Delaware
|
Stock Window & Door Southeast, LLC
|
Delaware
|
SBS Guilford, LLC
|
Delaware
|
Stock Building Supply Midwest, LLC
|
Delaware
|
Stock Building Supply of Florida, LLC
|
Delaware
|
1.
|
I have reviewed this annual report on Form 10-K of BMC Stock Holdings, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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a.
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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1.
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I have reviewed this annual report on Form 10-K of BMC Stock Holdings, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b.
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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b.
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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