Boise Cascade Sees Strong EWP Sales and Improved BMD Margins in Q4 2024 Despite Challenging Market Conditions
Boise Cascade, a leading provider of wood products and building materials, reported its fourth-quarter 2024 earnings on February 21st. The company's results showed resilience in the face of declining U.S. housing starts and single-family housing starts.
In its Wood Products segment, Boise Cascade saw sales of $419.7 million, down 7% from the same period in 2023. However, segment EBITDA was $56.6 million, a decrease from $92.7 million in the prior-year quarter due to lower Engineered Wood Products (EWP) and plywood sales prices.
On a more positive note, the company's Building Materials Distribution (BMD) segment reported sales of $1.4 billion, down 4% from fourth-quarter 2023, but still managed to increase its gross margin percentage by 60 basis points. This led to comparable year-over-year gross margin dollars for BMD.
Additionally, Boise Cascade's LVL (Laminated Veneer Lumber) sales volume increased 11% on a year-over-year basis, while I-joist volumes were down 2%, both of which outperformed the decline in single-family starts. However, as expected, seasonal declines in construction activity led to lower volumes sequentially, with LVL and I-joist volumes down 8% and 10%, respectively.
Despite these challenges, Boise Cascade's fourth-quarter plywood sales volume reached 371 million feet, a 2% increase from the same period in 2023. While plywood net sales prices were down 7% year-over-year, they did see an improvement of 5% sequentially.
Nate Jorgensen, Boise Cascade's CEO, stated that the company was "grateful to our associates as they have shown commitment to our values and steadfast support for our customers, suppliers and each other." Kelly Hibbs, CFO, also highlighted the importance of meaningful capital returns to shareholders, noting that the company provided "capital allocations in more detail."
Boise Cascade's results demonstrate its ability to navigate challenging market conditions while maintaining a strong focus on customer support and capital allocation. The company's outlook for the future remains positive, with a continued emphasis on growth initiatives and strategic investments.
