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Builders FirstSource Reports Fourth Quarter And Fiscal Year 2012 Results

Financial Schedules to Follow

BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES 
Condensed Consolidated Statements of Operations 
(unaudited) 
         
         
   Three months ended   Fiscal year ended 
  December 31, December 31,
   2012   2011   2012   2011 
   (in thousands, except per share amounts) 
         
         
Sales   $ 287,588  $ 192,677  $ 1,070,676  $ 779,093
Cost of sales   229,518  153,407  856,110  621,148
Gross margin   58,070  39,270  214,566  157,945
         
Selling, general and administrative expenses (includes stock-based compensation expense of $956 and $914 for the three months ended in 2012 and 2011, respectively, and $3,628 and $4,559 for the fiscal year ended in 2012 and 2011, respectively.)   57,820  47,093  222,263  192,959
Asset impairments   48  --  48  --
Facility closure costs   62  442  958  2,461
Income (loss) from operations   140  (8,265)  (8,703)  (37,475)
Interest expense, net   10,955  8,080  45,139  24,939
Loss from continuing operations before income taxes   (10,815)  (16,345)  (53,842)  (62,414)
Income tax expense   226  300  577  2,217
Loss from continuing operations   (11,041)  (16,645)  (54,419)  (64,631)
Loss from discontinued operations (net of income tax expense of $0 in 2012 and 2011, respectively)   (1,007)  (53)  (2,437)  (364)
Net loss   $ (12,048)  $ (16,698)  $ (56,856)  $ (64,995)
         
Basic and diluted net loss per share:       
Loss from continuing operations   $ (0.12)  $ (0.18)  $ (0.57)  $ (0.68)
Loss from discontinued operations   (0.01)  (0.00)  (0.03)  (0.00)
Net loss   $ (0.13)  $ (0.18)  $ (0.60)  $ (0.68)
         
Weighted average common shares:       
Basic and diluted   95,645  95,011  95,463  94,950
 
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES 
Sales by Product Category 
(unaudited) 
         
         
   Three months ended December 31, 
   2012   2011 
   (in thousands) 
         
Prefabricated components   $ 52,869 18.4%  $ 35,560 18.4%
Windows & doors   62,270 21.7%  47,171 24.5%
Lumber & lumber sheet goods   96,455 33.5%  54,253 28.2%
Millwork   28,320 9.8%  20,160 10.5%
Other building products & services   47,674 16.6%  35,533 18.4%
Total sales   $ 287,588 100.0%  $ 192,677 100.0%
         
         
   Fiscal year ended December 31, 
   2012   2011 
   (in thousands) 
         
Prefabricated components   $ 203,687 19.0%  $ 147,608 18.9%
Windows & doors   233,111 21.8%  183,313 23.5%
Lumber & lumber sheet goods   348,132 32.5%  225,002 28.9%
Millwork   104,165 9.7%  81,577 10.5%
Other building products & services   181,581 17.0%  141,593 18.2%
Total sales   $ 1,070,676 100.0%  $ 779,093 100.0%
 
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES 
Condensed Consolidated Balance Sheets 
(unaudited) 
     
     
   December 31,   December 31, 
   2012   2011 
   (in thousands, except per share amounts) 
     
ASSETS     
Current assets:     
Cash and cash equivalents   $ 131,432  $ 146,833
Restricted cash   12,068  13,229
Accounts receivable, less allowance of $2,831 and $2,138 at December 31, 2012 and 2011, respectively   117,405  76,429
Inventories   108,999  77,085
Other current assets   9,968  8,361
Total current assets   379,872  321,937
Property, plant and equipment, net   44,084  48,224
Goodwill   111,193  111,193
Other assets, net   15,692  12,440
Total assets   $ 550,841  $ 493,794
     
LIABILITIES AND STOCKHOLDERS' EQUITY   
Current liabilities:     
Accounts payable   $ 79,397  $ 48,618
Accrued liabilities   37,778  27,459
Current maturities of long-term debt   60  54
Total current liabilities   117,235  76,131
Long-term debt, net of current maturities   360,895  297,455
Other long-term liabilities   24,615  18,984
Total liabilities   502,745  392,570
Commitments and contingencies     
Stockholders' equity:     
Preferred stock, $0.01 par value, 10,000 shares authorized; zero shares issued and outstanding   --  --
Common stock, $0.01 par value, 200,000 shares authorized; 96,916 and 96,806 shares issued and outstanding at December 31, 2012 and 2011, respectively   957  950
Additional paid-in capital   363,471  359,750
Accumulated deficit   (316,332)  (259,476)
Total stockholders' equity   48,096  101,224
Total liabilities and stockholders' equity   $ 550,841  $ 493,794
 
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES 
Condensed Consolidated Statements of Cash Flows 
(unaudited) 
     
     
   Fiscal year ended December 31, 
   2012   2011 
   (in thousands) 
Cash flows from operating activities:    
Net loss  $ (56,856)  $ (64,995)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization  11,120  14,041
Asset impairments  48  --
Amortization of deferred loan costs  744  1,344
Amortization of debt discount  1,425  106
Fair value adjustment of stock warrants  4,992  736
Deferred income taxes  458  1,817
Bad debt expense  751  437
Net non-cash expense from discontinued operations  1,064  --
Stock compensation expense  3,628  4,559
Net gain on sale of assets  (38)  (212)
Changes in assets and liabilities:    
Receivables  (41,727)  (17,175)
Inventories  (31,914)  (13,275)
Other current assets  (710)  1,792
Other assets and liabilities  (195)  384
Accounts payable  30,779  3,752
Accrued liabilities  9,581  281
Net cash used in operating activities  (66,850)  (66,408)
     
Cash flows from investing activities:    
Purchases of property, plant and equipment  (10,398)  (4,792)
Proceeds from sale of property, plant and equipment  230  349
Decrease (Increase) in restricted cash  1,135  (14,165)
Net cash used in investing activities  (9,033)  (18,608)
     
Cash flows from financing activities:    
Payments under revolving credit facility  --  (20,000)
Proceeds from issuance of long term debt  62,075  155,200
Payments of long-term debt and other loans  (54)  (5,298)
Deferred loan costs  (1,639)  (1,285)
Exercise of stock options  596  --
Repurchase of common stock  (496)  (2)
Net cash provided by financing activities  60,482  128,615
     
Net change in cash and cash equivalents  (15,401)  43,599
Cash and cash equivalents at beginning of period  146,833  103,234
Cash and cash equivalents at end of period  $ 131,432  $ 146,833
 
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES 
Supplemental Interest Expense Information 
(unaudited - dollars in thousands) 
         
         
         
   Three months ended   Fiscal year ended 
  December 31, December 31,
   2012   2011   2012   2011 
         
         
Detail of Interest Expense:         
Term loan   $ 5,014  $ 1,533  $ 19,018  $ 1,533
Floating rate notes   4,541  4,553  18,164  18,355
Credit facility   11  217  38  1,149
Change in fair value of stock warrants *   576  736  4,992  736
Amortization of debt discount *   402  106  1,425  106
Amortization of deferred loan costs *   229  715  744  1,344
Other   182  220  758  1,716
Interest expense, net   $ 10,955  $ 8,080  $ 45,139  $ 24,939
         
         
* Non-cash item         
 
BUILDERS FIRSTSOURCE, INC. AND SUBSIDIARIES 
Reconciliation of Non-GAAP Financial Measures to their GAAP Equivalents 
(unaudited - dollars in thousands) 
         
         
Note: The company provided detailed explanations of these non-GAAP financial measures in its Form 8-K filed with the Securities and Exchange Commission on February 21, 2013. 
         
   Three months ended   Fiscal year ended 
  December 31, December 31,
   2012   2011   2012   2011 
         
Reconciliation to Adjusted EBITDA:     
Net loss   $ (12,048)  $ (16,698)  $ (56,856)  $ (64,995)
Reconciling items:         
Depreciation and amortization expense   2,867  3,472  11,120  14,041
Interest expense, net   10,955  8,080  45,139  24,939
Income tax expense   226  300  577  2,217
Loss from discontinued operations, net of tax   1,007  53  2,437  364
Facility closure costs   62  442  958  2,461
Litigation settlement proceeds   (637)  --  (637)  --
Stock compensation expense   956  914  3,628  4,559
Other   40  135  45  1,373
Adjusted EBITDA   $ 3,428  $ (3,302)  $ 6,411  $ (15,041)
         
Adjusted EBITDA as percentage of sales  1.2% -1.7% 0.6% -1.9%
         
   Three months ended 
   December 31, 
  2012 2011
   Pre-Tax   Net of Tax   Pre-Tax   Net of Tax 
         
Reconciliation to Adjusted loss from continuing operations:   
Loss from continuing operations   $ (11,041)    $ (16,645)
Reconciling items:         
Facility closure costs  62  38 442  270
Litigation settlement proceeds  (637)  (389)    --
Debt issuance cost write-offs   -- 517  336
Warrant fair value adjustment   576    736
Tax valuation allowance   3,611    6,507
Adjusted loss from continuing operations   $ (7,205)    $ (8,796)
         
Weighted average diluted shares outstanding   95,645    95,011
         
Adjusted loss from continuing operations per diluted share   $ (0.08)    $ (0.09)
         
         
   Fiscal year ended 
   December 31, 
  2012 2011
   Pre-Tax   Net of Tax   Pre-Tax   Net of Tax 
         
Reconciliation to Adjusted loss from continuing operations:   
Loss from continuing operations   $ (54,419)    $ (64,631)
Reconciling items:         
Facility closure costs  958  586 2,461  1,504
Litigation settlement proceeds  (637)  (389)    --
Debt issuance cost write-offs   -- 517  336
Warrant fair value adjustment   4,992    736
Tax valuation allowance   19,559    26,090
Adjusted loss from continuing operations   $ (29,671)    $ (35,965)
         
Weighted average diluted shares outstanding   95,463    94,950
         
Adjusted loss from continuing operations per diluted share   $ (0.31)    $ (0.38)
CONTACT: Chad Crow
         Senior Vice President and Chief Financial Officer
         Builders FirstSource, Inc.
         (214) 880-3585

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