Home » Builders FirstSource Reports 11.3% Sales Drop in 3Q
Builders FirstSource Reports 11.3% Sales Drop in 3Q
October 30, 2006
Builders FirstSource, Inc., Dallas, TX, a supplier and manufacturer of structural and related building products for residential new construction, reported third-quarter sales declined 11.5% to $569.9 million, and profit was $17.3 million, down from $27.8 million in the same period last year.
'Our third quarter results reflect the current challenges facing the homebuilding industry as many homebuilders work through excess inventory,' said CEO Floyd Sherman. 'Our sales were down only 11.5% year-over-year despite an estimated 20.6% decrease in housing starts in our markets and a 14.3% decrease in nationwide commodity lumber and lumber sheet good prices."
Many of the company's largest markets, including Texas, Georgia and the Carolinas, started to experience year-over-year declines in housing starts after experiencing year-over-year growth during the first half of the year. The company mitigated commodity price declines to a 3.8% decrease to its total sales primarily through pricing management and product mix.
Outlook 'We believe we can continue to mitigate a portion of the macroeconomic headwind by gaining market share to grow faster than our underlying markets. We also believe we can continue to increase sales through new operations,' Sherman said. 'However, we expect that difficult market conditions affecting our business will continue to have a negative effect on our operating results and year-over-year comparisons through at least mid-2007."