BFS tightens credit to survive downturn
The fourth quarter was especially brutal on pro dealers in the southeastern region of the country, where single unit housing permits dropped, on average 73 percent in Florida, 62 percent in Georgia and 44 percent in the Carolinas during the last three months of the year.
These four states are where Builders First Source, the LBM industry’s sixth largest player, has the bulk of its locations. The sharp declines in housing starts put even further pressure on the Dallas-based pro dealer, which ended the quarter with a $20.4 million loss and $302.3 million in sales, a 31.1 percent decrease compared to the previous year’s quarter.
These numbers dragged down the 2007 year-end figures, which posted a net loss of $23.8 million. Sales were $1.59 billion, a 29 percent decline. Calling 2007 an “extremely challenging year,” Builders First Source CEO Floyd Sherman outlined various measures the company has undertaken to survive the down turn during the company’s fourth-quarter earnings conference. Builders First Source reduced its head count—measured by “full-time equivalent positions”—by 18 percent in fiscal 2007 and 36 percent since March 2006.
Although it held off closing locations earlier in the year, Builders FirstSource eventually found it necessary to clos