Boise Cascade Warns of 2Q Earnings Shortfall
Boise Cascade (BCC), the paper and forest company, warned Friday that its second-quarter earnings will be "well below" first-quarter 2000 and second-quarter 1999 earnings because of weakness in the building-products and office-products distribution business.
For the second quarter, the consensus estimate of analysts polled by First Call/Thomson Financial is 71 cents. The actual number will come in much under those expectations, since the Boise, Idaho-based company posted first-quarter earnings per share of 60 cents and second-quarter 1999 EPS of 52 cents before special items.
In Boise Cascade's building-products business, rising interest rates and easing residential home construction, in tandem with strong production from the industry, have led to sharply lower prices for lumber and structural panels, the company said.
For the office-products distribution business, investments in internal strategic initiatives have increased costs, while "rising product costs, in particular higher paper prices, have resulted in a significant but temporary squeeze on profit margins," Boise Cascade said in a statement.Shares of Boise Cascade closed Friday trading at 26 1/4, down 13/16 or 3%. They fell 1 1/4, or 5%, to 25 in post-market trading, according to Instinet.
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