Builders FirstSource Reports $6.2 Million Profit in Fourth Quarter

March 2nd, 2010 by Editor

Builders FirstSource, Inc., supplier and manufacturer of structural and related building products for residential new construction, reported a $6.2 million profit in the fourth quarter on sales of $154 million. For the year, however, the company posted a $56.9 million loss, according to a company press release.

“We saw an improving trend in housing starts towards the end of 2009, as the national seasonally adjusted annual rate for single-family starts increased from 393,000 at the end of 2008, to 477,000 at the end of 2009,” says Floyd Sherman, Builders FirstSource chief executive officer.

The company reports that while 2009 sales and gross margin were down $314.1 million and $73.1 million, respectively, from 2008, its adjusted EBITDA decreased only $2.7 million.

“Although we have seen some recent stabilization in single-family housing starts, single-family units under construction decreased almost 28 percent in the current quarter as compared to the fourth quarter of 2008,” says Sherman. “Historically, units under construction have declined at a similar, and often times slower, rate than starts. However, this trend changed in June 2009, and since that time single-family units under construction have fallen 32 percent, while single-family starts have fallen only 12 percent, compared to the same period of 2008. For reasons that are unclear, the industry is experiencing delays in housing starts moving to units under construction. A start is triggered once the dirty work begins. Once the foundation has been established, the start becomes a unit under construction, at which time our potential for revenue begins.”

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