BlueLinx (BXC) 3 Aug 222022 Q2 Earnings call transcript

Greeting, and welcome to the BlueLinx Holdings’ Second Quarter 2022 Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation [Operator Instructions].

As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Ryan Taylor, Vice President of Investor Relations. you. Thank

begin. may You

Kelly and second everyone. Presenting quarter President BlueLinx; Dwight Operator, Financial the today welcome BlueLinx Gibson, and of CEO Holdings’ XXXX and our good you, Chief And Officer. morning, to are Janzen, Thank earnings call.

can information our includes quarter items Today's in closest measures to Form XX-Q news our SEC uncertainties, for the adjusted section are helpful the financial significantly Reconciliations to on Today's the to risk most questions. certain to you We we measure available yesterday forward-looking I'll follow our financial were statements, our and evaluating line including the presentation detailed statements and with Web believe be for slides along provide the and market of webcast. the the in investors the of that of context along encourage With discussion release the site, our webcast actual appendix described will second the with filings. we during non-GAAP issued results from due after forward-looking contains Our risks may various close presentation. differ over call bluelinxco.com. business. recent These Investors of GAAP remarks, our turn the conclusion presentation. open in At Dwight. that, found our prepared those

for you the Thanks, Thank good joining us on Ryan, everyone. morning, and call today.

to an It to teamwork US Leroy housing him handler BlueLinx exemplifies who [Diggs], get Leroy to outstanding celebrating material great his the work. a It value for to our time of and period a acknowledge company. thank I branch want core be is him a service to our like we people Leroy and on years to BlueLinx dynamic Before of make XX for started, commitment industry. I Richmond dedication place at congratulate continues and exciting and BlueLinx. the

$XX in results first of $X.X million free We the our financial $XXX of delivered best results and half Our combination billion are first flow. of EBITDA company's cash half million of sales, history. adjusted

to of the X by our EBITDA prior X% period XXXX, level greater ever. a in greater generating a key cash diluted This year delivered In $X.XX of three our market about historically $XXX wood per than rates. in [deflation] of we ever EBITDA half to we and delivered compared adjusted As EPS of period. quarter by million share, commodities than metrics, the rising of most XX% profitable operating based strong due first and XX% grew operating despite generation We demand, strong with million and times half cash third highest while interest increased sales and of first adjusted profitability QX, cash. $XXX represents rapidly uncertainty

environment building housing the in half key in a XXXX of to several strong Following the towards high underpinned and of supply are pandemic, stable operate an pointing by a the and could business. global we Moderation by chains since easing supply the pandemic marked indicators which of from the onset a growth slowdown. turning a low two years lead fueled more experienced to industry products the first our point, demand

drive that enduring market on our the strategy BlueLinx we environment this ample and we analyzing We the of a believe demonstrated point at we've execution We are improve on have we've improvements growth is opportunities. and and scenarios in outlined Investor we made improved opportunity potential that confident June. to operating prepared further our end well the the to performance. Day profitable monitoring I'm variety are closely so any capitalize to based to are positioned

to early products building preeminent distributor. into transform still BlueLinx our are America's We in journey North

balance our a as flexibility productivity and strategy accelerating the ever is in strategy optimizing strong accelerate us on manner. to it in as our growth financial Our performance. world And specialty is disciplined products, our sheet been focused class has driving giving

to We positioned advantage attractive are execute we strategy. well of as take growth our investment opportunities

along and are the establishing, with the compelling talented we this are culture We to a we assembled value our based have stakeholders. team performance that provides opportunity significant to confident strategy, deliver us

Looking specifically at QX XXXX.

to second team navigated in in quarter, base capabilities. During our continuing the products, and progress value and strategic a we prices dynamic prioritize our in environment initiatives macroeconomic and deflation growth higher while commodity specialty wood build successfully investments our rapid productivity to

quarter management commodity sales year-over-year dropped our to value focus, and respectively prices. largely XX% and to in product wood, third QX gross more contrast, sales to second which resulted of led offset margin gross our approach and EBITDA were in this quarter. up dramatic XXXX. $XXX our on inventory respectable discipline focus adjustment, year perspective, market millwork, reported cost of specialty by demand of and And decline growth growth profit. siding of a comprised adjusted Kelly periods in structural in mid-March product of lumber panel of the level declined cash second profit sales, delivered a basis, strategy. XX%. than $X.X only will $XXX of on Sequentially, industrial profit the pricing, significant decline XX% we’ve line of based and in grew late XX% consistent $XXX due XX% was cash wood and at in and of the is Despite product sales quarter, considering conversion gross a modest standalone peaks which in gross lower million million We the X%. adjusted for XX% In details continued any was performance flow on of which free from X% adjusted gross with products from lows than the structural specialty Our up team's by of our this highest and to approximately based year-over-year, volume. QX million billion June. which business, Specialty structural adjusted a in prices with EBITDA, of in year-over-year in disciplined strategic composite $XXX demonstrate a is QX more with driven in is products that The execution. million growth call. achieved operating our and products, before products which testament results of headwind, gross EBITDA. EBITDA $X.X engineered delivered prices. specialty stability very exceeded $XX XXXX was wood margin X% building of QX and And about strong of sales record. million, single provide million based to margin Two and third more generated commodity and products we inflation highest strength We our On XX% a our later XX% a

with X Our our the $XXX turn of liquidity and leverage level cash generation highest million, below We position. available just ever. strengthened quarter net ended our financial over

slowing profile future During incredibly year. our a outstanding first business, the quarter, million X% as in on-track With authorization an our purchase $XX accelerated previously half, cash purchase is $XXX announced, actions program. economic investment. approximately a environment, our adjusted entered on the Based increased we of into believe share this we we of compelling repurchase our share to million, and EBITDA the even through BlueLinx are purchase shares to also share

execution a disciplined long growth to value shareholder allocation. the purchases term confidence continued and strategy, US in in closer demonstrate improvement our commitment share Taking delivering look capital housing industry. Our a at our through

in a we Following softening starting explosive fueled two the market. has growth, outpaced demand to are years, where see supply and

home During the first broad rapid half home appreciation buyers rates for starts. reduced and based and slowed XXXX, inflation, the of affordability price mortgage in new many home have rise

on did While high of the home to homes, term our to demographic we believe second will under Other and and US a slowdown equity remodel developments industry we levels continue and repair shifts, supporting demand the in wage quarters. factors XXXX will an demand half housing low long the business, That they include beyond. of lead unemployment immediate activity anticipate the demand growth. these of not supply housing over in support and said, have coming impact in

consider and continue supports we In Additionally, this support mortgage housing equity, studies aged double for over growth. rental increases renters stocks rate activity year view, market, the most over levels higher quarters. to The will and recent joint to in with housing center believe housing purchases, that maintain home the high four repair remodeling with expected digit estimate the rates. growth turnover may from to home influence of next digit double the a remodel rates past even

related our As tied we to repair to reference, commercial construction with a and estimate sales remodel about new home residential tied annual point industry. XX% XX% XX% market, the of of and the to are

invest to continue our our of the business we outlook, demand and Given our execute strategy. assessment in

a productivity are prioritizing mix product account priorities and our are in we excellence to strategic driving shifting centers. our include on strategic partnering sales. national customers. suppliers specialty key goal plus procurement throughout of perspective, sales Our with time an product this, To From XX% specialty and we accomplish over operations categories key and five growth distribution focusing optimizing

a and high rigorously to capabilities continue organization from strategy with that confident driving And into a a based people also we are perspective, this performance We We're continue our strong approach culture. significant to along caliber fusing create manage And working our capital. us in compelling enables value allocation while opportunity balance maintaining for a to prudent financial to position. our capital provides us to shareholders. growth invest disciplined sheet

second drive to team generate remarks. To for of good and over the quality results of to and record volatile more We strong my on team's will investment turn financial a opportunities and discussion continue this capital is strong quarter. that I'm our a delivered and in quarter strategy. our first focus, our and efforts the financial invested historically growth At testament to for long entire That call environment made attractive and structure. summarize discipline, Kelly their concludes We opening profitable performance and the term BlueLinx results our to time, returns contributions proactively proud detailed execution. evaluate I'll capital. a half will progress

closing your I'll that, Following questions. provide we remarks Kelly? take before

good and Dwight Thanks, morning, everyone.

of modest as compared given Net modest experienced in financial sequential products historically products basis, is our were QX second our this during sales decline treated XXXX Net speaking, XXX commodity significant for and despite product $X.X to reduction a on the which by specialty and all grew wood the which profit results Gross high. And Gross of the the in the primarily increase $XX million profit to in based for Taking wood XX.X%, a with sales QX deflation. last of was was over for a pricing mentioned, growth primarily million commodity Specialty the structural record down product panels. levels. volume. million, sales Specialty over of sales, last And This and prices including the a the decline a performances second comparison from on million, driven up margin gross in The XX% however, just strong partially headwinds volume XX% XX.X% $XXX margin nice mark was demand the closer a was billion, period. lumber was Dwight to based consistent of one from specialty up strongest product’s sales. our quarter was were in exceptionally declines specialty product $XXX gross related period growth Through from caused sales in by specialty margin or of was industry during strong primarily difficult was growth. X%, of XX%. offset XXXX, XX.X% As volume quarter, was a the This our by year-over-year. a sales perspective margin XX% offset steep July, X% specialty XX% in in that, sales prior X% building quarter total. was range specialty value increased gross siding volumes $XXX was year. which were $XXX year, year-over-year time within gross XX% quarter. year. basis On for an down by historical the profit products volume from was based but at second product year-over-year. look points disciplined X% or million

framing was quarter. year Now million per volume year-over-year, to or structural sales deflation length, Net modestly $XXX period. around earlier $XX board the prices X.X%. the was per quarter $XXX prior for of and panel moving primarily panel gross attributable In the was $XX for foot in product on random fell to prices to foot, price were the Gross pricing to compared structural in prices square foot lumber per million, thousand This and per XX% a square second $XXX was and down foot, in XX% board down average year-over-year. price down decrease about and products. panels with June, thousand the $XXX thousand margin Per to down year-over-year, average profit decrease XX% much XXXX to higher million, XX%. $XXX thousand was lumber lumber compared

to Given of reflect realizable similar the lower this, $XX.X on million. the structural of as net we pricing This and we when QX value reduction our to in structural increase same the and adjust quarter, inventory of quarter. out month cost full margin date million the have structural pace at that reverse market anticipate lower we recorded pricing or a realizable cost the value of per $X.X adjustment in to cycle end net and reserve reflected inventory which the a in the ranges. we of booked recorded value methodology third we reserve we through used to of value QX our is July in lumber July, the the panel of in Based of XXXX in

will required. we future continue pricing adjustments monitor and to commodity evaluate are However, whether

margin and steep structural the result quarter. for decline in commodity X.X%. the reserve, this during A gross was solid Excluding prices rapid QX given the

in structural exceptional in an second of mitigate inventory do to quarter the gross purchasing to four centralized and through the July, trending higher decisions continues for daily XX% was consignment weeks team and inventory up quarter third utilizing risk. leveraging managing range keep Our were far slightly levels, job to and structural structural through the Thus of pricing low margin levels XX%. structural first than and volumes products

just However, the of I this includes benefit expected the points about XXX basis from mentioned. reserve reversal of

increases On is market each for continue quarter end accordingly based commodities which year-over-year SG&A pricing first the of of flat $XX adjust million, basis, was period. to will evaluate SG&A a XXXX. We at wood to increased and partially the approximately in commissions investments our X% due sales were These and includes to with level strategic delivery lower compensation, incentive a workforce. by variable offset higher incentive. mostly cost of along SG&A in which

percent XXXX, $XX down first we from diluted share. a of of prior income environment. $X.XX of XXXX, inflationary per diluted in given X.X% have the was SG&A reflects $X.X a period. was lower were and good a As outcome shares the which shares Net Diluted million, year $X.X in QX million the sales, was very EPS in outstanding $X.XX repurchased in The the in to million EPS the share half count resulted quarter. benefit

the Our XX.X%, our in quarter tax rate was for line with expectations.

our we've XX% mentioned, net anticipate of quarter higher EBITDA EBITDA this any for we second the third Dwight QX, For $XXX XXXX the of the And million to X.X% rate be level sales. was range as quarter. adjusted in Adjusted of of or delivered highest XX%. in slightly is tax to

and Turning now working to flow cash capital.

flow During quarter, $XXX operating respectively. free generated cash and and the second we $XX million million of

based commodity to more benefited primarily by QX million $XXX Our related XX% wood Capital the which specialty $X.X of distribution from with in our were cash inventory, deflation expenditures million than period. which We ended quarter upgrades at receivable to during related second and and branches. of supported collections, enhancements was products. generation the

upgrading These facility our digital and stock For year, the capital quarter. significant to anticipate still the rolling in increase and continued fleet third a focused investing improvements, full with enhancing be we on in will capabilities. $XX up investments our of million expenditures technology expected

sheet. at now balance Looking our

hand times, $XXX at As million, of leverage down was and debt on debt X.X less was $XXX total the than million. our was million, Net from second the on any cash of of net times capacity sequentially $XXX second revolver liquidity and cash undrawn the million, point end available hand at and available history. X of end flat was had quarter, million When was XXXX. level $XXX considering of $XXX highest have quarter the our liquidity the of we in

growth. to in invest Given in a ample liquidity are this, financial position strategic with we strong

a principles net to at target intend term economic invest business capital a balance strong times. sheet, which a of maintain As enables long allocation, leverage our for reminder maintaining around of X while we or cycles, us in our to guiding through

both As yield that will cost consistent strategy growth, with our evaluate we weighted and above our mix average acquisition adjusted are of for and products. return organic to of increase invest we specialty our risk opportunities capital a

income, a record. on XXXX will disciplined returning being opportunities approach We quarter adjusted the half the and cash second first of comparing to the of value strong maintain delivered resulted in growth operating those in shareholders. we to To very net best all sales, investments, against half XXXX, which the of capital summarize, EBITDA

this approximately our is We are in of excellent and leverage low X% track liquidity. repurchase shares to high sheet on shape And time balance with outstanding our year. all

on back to this our focused strategy, a for turn are time, long executing term over and value closing maintaining Dwight strong delivering our financial shareholders. I'll position At remarks. We call the to

Thanks, best sales EBITDA, million strong of XXXX. record Kelly. XX% we closing, billion $XXX of and and first over our with sales X% growth In in a half growth $X.X EBITDA adjusted representing half first adjusted very delivered on

We our products driving specialty improvement continue grow while throughout to business. continuous the

Our business and investing in been as profitable to financial the and has focused world drive deliver our class optimizing position on and as performance. specialty products, control, growth. are laser We is increase ever our in accelerating productivity it growth remain things efficiency our driving capacity within to strong we

prepared our time, questions. strategy all we happy offerings At the long key committed will relationships continue suppliers. and in have the any are building best service and remarks. answer steadfastly value be concludes and to That expand to customers America stakeholders that North to distributor we believe We're is products for products scale, aspiration our Our to and preeminent we that our with we're goal. term confident to create this

with first from Palm question is Craig-Hallum. Our Greg coming Instructions] [Operator

guess of couple last you're wondering strategic the I months. maybe approaching just investments wise, your And of view business, the how few over capital strategy lots items a whether I'm that's allocation. differently, changed more changed any

if there's more in any given or aggressive, of curious on the conservative the becoming where Just more macro? you're just areas what's going either business

scale We well communicated, direction, really lean like we mix the that right into very confident markets, think where driving we strategy We we in the the on we're that building to we're right focused are. positioned feel and in strategy. in

perspective change. efficient accelerator more and to the are As share always, opportunities we're strategies. perspective, for us to surprises there as and opportunities think we take But to always to doesn't people continue opportunities process particularly look meaning organically that going to in from business the a from right a make to looking organically at for and and trying [abed] to

you you better to it housing focused builds than like the of mean, commercial? even maybe up like if are Are slow that or shift some maybe shift in focus to let's more manufacturing non here? housing able or I more of to say if areas areas holds some traditional able towards market R&R new housing the continues

of If is you home new construction non our think about driven. mix, businesses XX% our

other about, the excited about So mentioned, products the products well we spaces. play in we're those as into, R&R think those you and areas and we're they leaning

dynamics connection of leaning going we natural and a we're that into still focus fairly that. healthy the to in markets continue us there's on kind around to So have think of it terms

is I normalize months demand XX one, the much housing would overall in? so. has business then of tailwind housing environment, the slowing about to how last, And pricing in the sticky a the don’t segment last to over or from starts thinking gotten know, come that that if need much specialty and How

us here of. around structural start been been has an volatile can more side definitely that governance to the specialty But team that floors enjoy which believe advantage the kind perspective, that better business, the let's historically. from than environment to our there's had really that. an allow more absolutely are a able Kelly little from of perform be we side. pricing things us a into done the well on are some stable capabilities also emphasize bit and from a believe to opportunity specialty And we bit to all take we've clear, continue across pricing a perspective, add things little to more perspective, supportive analytics is color. and perspective, execution the to intentional Clearly, side to going lean some of but So I'll to we to margin And continuing allow going do margins we the there's a think from us we've continue on specialty on

at to analysis add to I would mentioned continue a good margin we is environment, macro echo margin that the the to we're I've we in supports normalized past relative Dwight's that to that the think a specialty is I downturn comments numbers think in XX% that looking that, that XX% and and just think which margin of now. that do and a right

really we've this So comfortable our discussion and previously view all wouldn't that I we time. change at the around with on had feel that

question Our coming with from is next the Kurt line D.A. Yinger of Davidson.

itself I Kelly, your you siding the or that on prepared comments collective growth. in of think start areas to X% specialty? growth just volume wanted kind noted, specialty in focus just I Was off

So -- generally spots a such see decline saw that's overall. But siding. within of kind -- we we had as bright some some modest did we

within saw kind overall areas we So impact. the the indicating that's couple just some of where growth

over… And Okay, sense. makes that

quarter. relative to strong very was that's which a last And year,

So the I that's still also was I were quarter, from referring is -- really quarter. the sequential last a up that -- and think it's to in out still we sequential what from

end some the material guess markets? share positioning into gives of you availability focused confidence seeing the potentially notwithstanding terms specialty of last of how quarters, changed what any on and to I about volume improved side. volumes XXXX? of there And on some in categories kind the And business Has specialty the in you trends in you couple start on challenge played anything to that could you've are the side, I guess talked the over the that's pick-up

areas constraint in EWP we honest. industrial Barbara siding, remains products. be some a of some have of Ciment categories We from a couple and still easing in some products. it's bag, but the seen some supply and a mix other perspective to see around our So outdoor millwork some living categories. challenges import

just And are so really run on to continuing strategy. focused we

So sales is together of are efforts kind we putting our of that. think to continue to with, grow we and wallet programs national accounts, to opportunity there share and building drive

of products also branches of expanding and across these availability at our across looking network. We some our are

So the of we and that. parts excited opportunities are it products, to really as west about outdoor and some do to products, We that, region particularly east more see region living relates siding of the south.

how levels So we these great focus we we do our on and best as as of continuing customers to and how customers at a level more it's high how again, delighting and business, drive earn parts we really our operate service can products for can. more we so do make efficiently continue in our to executing their of do network available

a strategy you I they in And level given shift that volumes Does structural, in guess, that of where represent prices running perhaps sit commodity sort were, today? risk mentioned any through ahead QX levels. of with July lower of

our last back strategy. started we the over down prices people rebound. demand to It changed When just really to the they doesn't in come little increase and are just I weeks up of of prices have reflect commodity just the and think up. it the hold in some on of flows that. But bit had as no, the nothing We have opening and represents ebbs go a markets and kind a as I has starting few -- think volume, always

as manage as inventory risk keep appropriately. and serve to that continue and possible low our still We customers

expect couple have So would to ago. overall, what relates been saw we volumes kind we of a be as to they where still years lower it than

in our are we pretty that, approach. emphasize I'll convicted

priorities business we need and driving that structural are to talked those really emphasis, five on investment and our sure overtime and change. what about, business categories core particularly is our really have to that We going continue we specialty our mix, customers. we looking see no what be can, we manage just make core our we And as our tightly to as for

get that. more is I downside would I if important. environment. business But into hold No, understand there more quite a back strategy you and I we I specialty what demand and guess structural obviously a leaning walked into away that? the And the you perhaps guess, challenging we is XXXX do from look doing much to from side where mean,

value and hold. area and it's that both And do allow market And Again, it to in at lot believe business. do. an complimentary energy most, that think make believe role, best, we think, we and their in we a how is continue continuing how a investing a spent to way supplies to that want role our to for that we about for still key is, needs again, our continue But we the customers. we the thinking to business softer around to key we level, creation can play our to position we and we do that provide business, parts is ourselves are I a No. partner there, how play. our of we them we the value do we on we things make will to wrapping that's clear a very key care plays and how convinced what the and manage that way maximize environment really are of there, service It’s a kind that we time of that that we're provide be sure really right capability to sure it, the supporting specialty sure Structural the about keep good run. the even inventory do want and around right create running we connected their and make and supplies value customers the we're they and

sit year? working on one a last to my expect just And that this From be use capital. of cash or today, source you do where you

perspective, towards we driven you flow We a the focus working continued that this would through and know the working great for really cash on capital. expect, of you when the looking flow combine and to focus with a capital. cash deflation earnings probably point, the well from It deflation we're to was continue at rest our positive we a the year, -- as had year. quarter continue And and as some on so

is next Our Company. line from Benchmark of with the The question Reuben coming Garner

so specialty is kind the other normalized dependent and of In Can chain pre-COVID? changes, side, lead XX% normalization, downside Kelly, level? is supply I of starts question things and and kind on of to the kind back So how or to to XX% is you of clarify normalization in means that that to what single the is appreciate family saw meaning up just volume would guess loosening just to therefore going we what words, the XX%. pricing that? kind XX% my that that

it back and type it's to, we around So pre-COVID consider that -- right. refresh would say, really we've of to really the analysis really it's means as levels, kind continued both -- I going of

expect chain fall to would that the changes us. we And sort of the pricing, some supply as put going it’s where to that that volume pricing given open As kind done think up, demand our approach. of we've pressure put we in be supply we'd would more out on available strategic that's

we're worse in just to think pressure than, in to more downward any be point anticipating shift I I environment what fundamental currently that have at overall macro of think, this to time. the be really a would

anticipate what totally pressure So couldn't I be on would else that.

and And short be that it would so confident to around now, You at risk the always see that far. analysis story. the point. right could this pretty as potential feel I we've think is -- a It we have done never don't I happen. know, But

coming of dollar kind normalizing. SG&A $XX to like pre-COVID on was and XXs. basis? about in million same of mid think I And in that was north then lumber that normalization that a that of prices amount volume kind The normalized kind in, couple look with of how think maybe quarters, environment on of last What question a quarterly

some the and fuel some times to certain brought in that Well, the remember very customers we been and time T&E. back in things also did of if adding the very, pulled you party Since pulled we've RIF, discretionary targeted down And then, of and we've had then of recent invest SG&A for that very is types spend to to inflationary back We costs. to of those mentioned. tightly. like our on spending around And us COVID, come addition, then in costs are types all around of we impacts into workforce dependent discretionary XXs. probably our most costs the seen we also volume our freight, we've third be able that related serve us our in and delivery a in

thing. we of volumes that, increase, course, around related and see as I as mean, would a be increase terrible costs. -- we're some as not cost can efficient being those So possibly to we would we that But see probably SG&A

So And were we in monitor it closely. last we were XX, we year. the XXs, at

considering job going a to the fact that doing So in had we're cost, significant still I and forward employ our containing that great we've think our a increase want we strategies profitability. such

And the other we're SG&A. element for on efficiency that focused the I'd is add to

really we that's think feel on. in And SG&A of relative one so we're are look I market. team about percentage to you that. market area continue the and a at And from focused an And our think sales, make to of broader return a we're things maintaining focused as Kelly down that it sure our on that our about as the that and stay we and relative that's getting to right a about SG&A good if pretty good to investment, we the going think volume, basis in discipline on the

months, the me, likelihood find a Or difficult last And could something pipeline. fruition? M&A over I kind is one Any about are is sneak last likely come in, maybe of then from that's and commentary it evolved few or less it it if the see is more one to making this environment? of to guys choppy in going to kind you more deal the that increasing how

are that we would again, think of with serve specialty accelerate good see move us journey. that some kind strategy, And given more financial we balance to And our to fit perspective, sheet to the bit better seen from maybe you've a So in opportunistically that provide things customers continue opportunities very a on sales our our side certain in particularly little remain markets, we're up if reticent. to we allow positioned engaged interesting come opportunities. well and as time, down sponsors we opportunities up again, are evaluating our core rates mix where

things, cost about and we can framework create there our risk again, see happens. leveraging engaged, we greater the and shared to we'll very that what we sure than adjusted talked continuing evaluating to stay So remain we're and make value of active capital really

Loop question Capital next coming Stevenson Markets. is Our with Jeff from

forward? inventory would inventories the some half expect continued to the segment in still constraints do point moving to to lower number supply or normalized of you're a given the just you in outlook levels uncertain seeing run maintain residential at year an products of back So categories, specialty you due plan

the We quickly of at inventory we as And key element as look as turn a how we want velocity are to of performing. can. our that we

us. of that's really teams, balance to job the for sales purchasing really we the to So we done with the with into and and as to and a on make between that our demand, starting the supply good an our that to have we And specialty are going our side. side. sure teams lean continue work we so really area right product well teams are focus teams structural and And have on

as inventory only continue to to not moved look through this we the second XXXX. year So drive half we velocity,

backlog that between down now is to housing my visibility long cited, how at slow blast dislocation question and of the I next? over you right things now and starts completions some And year But could the past point. moment. of on kind year. how just there the just right the second early kind then elevated still you end have expect you of into much your is residential new of given backlogs volumes the a into know And wonder new at

I exposure. fair products and they are everyone So we in a through And pull 'XX. builders. of Again, support And XXXX our are of have conversations think listen position in -- a we of is XX% I've that. see to backlog that's of do to some obviously, in in earnings expecting are some are continuing our still back starts you of to And to if their that. and had captured make amount lot you working a sure lot key a elements, the

for that. fairly well. But to comes quite some more and we focusing We and opportunity ones supply target we manage honestly, some tightly think of and an continue on there’s potentially as new we accounts also that see to access we be we can selling that have as we’ll some to prepared do that some really drive

as direction. So to it it sure XXXX to and either relates second to we stay half, as okay feel adjust going focused make are But in today. we stands flexible can we

share you before moving And you out And normalizes then, to that about once talked specialty be Would Dwight, about gains cement the less based initiatives, back constrained. you of the or strategic think we on half to should how forward? expect moving becoming about fiber EWP and pursue in able forward. you'll share that here in gains year start seeing supply talked your

commercially XXX Obviously, what and gains in uncertain but all or time. That's we volatile. our on next these our focused. operationally. in that's that's days focused that's our fairly where gain, and value teams is that into XX that's intent, steadily But next the categories are the fairly to, got we opportunities strong is focus days is be their the that Will [TBD], talk proposition result. And what a where what making share understanding happen for are are about sure will do on, that that overtime align to environment the leaning we and our expectation the that's in compensations

Thank have at no you. time. we questions It additional appears this

closing the management for pass So I'd back comments. like to to any floor

day on We our Jesse. us I'll be questions the interest the any the your and want ups, for All follow of Ryan around right. there is Thanks rest joining free week, us. from We'll out analysts. This the throughout Taylor. everybody please and morning. the to Thanks, time. joining to balance feel other appreciate is Alexander just for next of I reach you thank call this talk the and us. if to

your does lines Ladies may at today's this and time. we teleconference. Once and gentlemen, you thank your you participation this for again, conclude disconnect