Filing Compare · BlueLinx Holdings Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~March 30, ~~2023~~2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 001-32383


			BlueLinx Holdings Inc.
			(Exact name of registrant as specified in its charter)


Delaware		77-0627356
(State of Incorporation)		(I.R.S. Employer Identification No.)

1950 Spectrum Circle, Suite 300
Marietta	GA	30067
(Address of principal executive offices)		(Zip Code)

(770) 953-7000

(Registrant’s telephone number, including area code)

Not applicable

(Former name, ~~former~~or ~~address and~~ former ~~fiscal year~~address, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	BXC	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically (Section 232.405 of this chapter) every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐☑ Accelerated Filer ☑☐ Non-accelerated Filer ☐ Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of ~~October~~April 2726, ~~2023~~2024, there were 8,~~767~~661,~~201~~741 shares of BlueLinx Holdings Inc. common stock, par value $0.01, outstanding.

Table of Contents

BLUELINX HOLDINGS INC.

Form 10-Q

For the Quarterly Period Ended ~~September~~March 30, ~~2023~~2024

Table of Contents

INDEX


			PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements — BlueLinx Holdings Inc. (Unaudited)			1
Condensed Consolidated Statements of Operations and Comprehensive Income			1
Condensed Consolidated Balance Sheets			2
Condensed Consolidated Statements of Stockholders' Equity			3
Condensed Consolidated Statements of Cash Flows			4
Notes to Condensed Consolidated Financial Statements			5
Note 1 - Basis of Presentation and Significant Accounting Policies			5
Note 2 - Inventories			6
Note 3 - Goodwill and Other Intangible Assets			7
Note 4 - Revenue Recognition			8
Note 5 - Debt and Finance Leases			9
Note 6 - Net Periodic Pension Cost			11
Note 7 - Share-Based Compensation			11
Note 8 - Lease Commitments			11
Note 9 - Commitments and Contingencies			15
Note 10 - Accumulated Other Comprehensive Loss			15
Note 11 - Income Taxes			15
Note 12 - Earnings Per Share and Stockholders' Equity			16

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			17
Item 3. Quantitative and Qualitative Disclosures About Market Risk			25
Item 4. Controls and Procedures			25

PART II. OTHER INFORMATION
Item 1. Legal Proceedings			26
Item 1A. Risk Factors			26
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			27
Item 3. Defaults Upon Senior Securities			27
Item 4. Mine Safety Disclosures			27
Item 5. Other Information			27
Item 6. Exhibits			28

Signatures			29

			PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements — BlueLinx Holdings Inc. (Unaudited)			1
Condensed Consolidated Statements of Operations and Comprehensive Income			1
Condensed Consolidated Balance Sheets			2
Condensed Consolidated Statements of Stockholders' Equity			3
Condensed Consolidated Statements of Cash Flows			5
Notes to Condensed Consolidated Financial Statements			6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			17
Item 3. Quantitative and Qualitative Disclosures About Market Risk			29
Item 4. Controls and Procedures			29
PART II. OTHER INFORMATION
Item 1. Legal Proceedings			30
Item 1A. Risk Factors			30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			31
Item 3. Defaults Upon Senior Securities			31
Item 4. Mine Safety Disclosures			31
Item 5. Other Information			31
Item 6. Exhibits			32
Signature			33

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME

(In thousands, except per share data)

(Unaudited)

	Three Months Ended				~~Nine Months Ended~~
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
	March 30, 2024		April 1, 2023
Net sales	$	~~809~~726,~~981~~244	$	1797,~~060,761~~904	$	~~2,423,852~~	$	~~3,602,445~~
Cost of sales	670,735		871,385		2,015,264		2,920,610
Cost of products sold	598,563		664,365
Gross profit	~~139~~127,~~246~~681		~~189~~133,~~376~~539		~~408,588~~		~~681,835~~
Operating expenses (income):
Selling, general, and administrative	91,~~354~~250		91,~~678~~174		~~271,278~~		~~274,305~~
Depreciation and amortization	89,~~089~~433		67,~~688~~718		~~23,758~~		~~19,952~~
Amortization of deferred gains on real estate	(984)		(~~983~~984)		~~(2,952)~~		~~(2,951)~~
Gains from sales of property	—		—		—		(144)
Other operating expenses	314		3,116
Other operating expenses	1,131		1,267		5,240		2,731
Total operating expenses	100,013		101,024
Total operating expenses	99,590		98,650		297,324		293,893
Operating income	27,668		32,515
Operating income	39,656		90,726		111,264		387,942
Non-operating expenses:
Non-operating expenses:
Interest expense, net	4,624		7,687
Interest expense, net	5,577		10,444		19,575		32,992
Other expense, net	—		594
Other expense, net	594		(361)		1,782		916
Income before provision for income taxes	23,044		24,234
Income before provision for income taxes	33,485		80,643		89,907		354,034
Provision for income taxes	5,552		6,422
Provision for income taxes	9,103		21,134		23,247		89,844
Net income	$	17,492	$	17,812
Net income	$	24,382	$	59,509	$	66,660	$	264,190
Basic earnings per share	$	2.02	$	1.96
Basic earnings per share	$	2.72	$	6.44	$	7.39	$	28.03
Diluted earnings per share	$	2.00	$	1.94
Diluted earnings per share	$	2.71	$	6.38	$	7.38	$	27.82
Comprehensive income:
Comprehensive income:
Net income	$	17,492	$	17,812
Net income	$	24,382	$	59,509	$	66,660	$	264,190
Other comprehensive income:
Other comprehensive income:
Amortization of unrecognized pension gain, net of tax	—		239
Amortization of unrecognized pension gain, net of tax	225		156		689		468
Other	—		(11)
Other	—		(24)		(22)		(24)
Total other comprehensive income	—		228
Total other comprehensive income	225		132		667		444
Comprehensive income	$	17,492	$	18,040
Comprehensive income	$	24,607	$	59,641	$	67,327	$	264,634

See accompanying Notes.

Table of Contents

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

	September 30, 2023		December 31, 2022
	March 30, 2024		December 30, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	~~469~~481,~~783~~309	$	~~298~~521,~~943~~743
Receivables, less allowances of $3,614 and $3,449, respectively	297,568		251,555
Receivables, less allowances of $3,293 and $3,398, respectively	288,244		228,410
Inventories, net	~~364~~370,~~162~~942		~~484~~343,~~313~~638
Other current assets	3932,~~501~~165		4226,~~121~~608
Total current assets	1,~~171~~172,~~014~~660		1,~~076~~120,~~932~~399
Property and equipment, at cost	~~381~~406,~~593~~918		~~360~~396,~~869~~321
Accumulated depreciation	(~~165~~175,~~976~~757)		(~~155~~170,~~260~~334)
Property and equipment, net	~~215~~231,~~617~~161		~~205~~225,~~609~~987
Operating lease right-of-use assets	4234,~~145~~869		4537,~~717~~227
Goodwill	55,372		55,372
Intangible assets, net	3129,~~817~~768		3430,~~989~~792
Deferred tax assets	54,898		56,169
Deferred income tax asset, net	53,629		53,256
Other non-current assets	14,~~596~~186		1514,~~254~~568
Total assets	$	1,~~585~~591,~~459~~645	$	1,~~490~~537,~~042~~601
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	~~202~~171,~~256~~715	$	~~151~~157,~~626~~931
Accrued compensation	1813,~~624~~642		2214,~~556~~273
Finance lease liabilities - current portion	9,813		7,089
Finance lease liabilities - current	12,157		11,178
Operating lease liabilities - current portion	6,845		7,432
Operating lease liabilities - current	5,824		6,284
Real estate deferred gains - current portion	3,935		3,935
Real estate deferred gains - current	3,935		3,935
Pension benefit obligation	2,380		1,521
Other current liabilities	41,873		24,961
Other current liabilities	24,045		16,518
Total current liabilities	249,146		218,562
Total current liabilities	267,898		210,677
Long-term debt	294,073		293,743
Non-current liabilities:
Finance lease liabilities - noncurrent	279,910		274,248
Long-term debt, net of debt issuance costs and discount	293,413		292,424
Operating lease liabilities - noncurrent	30,248		32,519
Finance lease liabilities, less current portion	267,530		265,986
Real estate deferred gains - noncurrent	65,648		66,599
Operating lease liabilities, less current portion	37,007		40,011
Other non-current liabilities	19,399		17,644
Real estate deferred gains, less current portion	67,550		70,403
Total liabilities	938,424		903,315
Other non-current liabilities	20,549		20,512
Total liabilities	953,947		900,013
Commitments and Contingencies
STOCKHOLDERS’ EQUITY:
Stockholders' Equity:
Common Stock, $0.01 par value, 20,000,000 shares authorized, 8,795,908 and 9,048,603 outstanding on September 30, 2023 and December 31, 2022, respectively	88		90
Preferred Stock, $0.01 par value, 30,000,000 shares authorized, none issued	—		—
Additional paid-in capital	174,906		200,748
Common Stock, $0.01 par value, 20,000,000 shares authorized, 8,661,738 and 8,650,046 outstanding, respectively	87		87
Accumulated other comprehensive loss	(30,745)		(31,412)
Additional paid-in capital	166,503		165,060
Accumulated stockholders’ equity	487,263		420,603
Retained earnings	486,631		469,139
Total stockholders’ equity	~~631~~653,~~512~~221		~~590~~634,~~029~~286
Total liabilities and stockholders’ equity	$	1,~~585~~591,~~459~~645	$	1,~~490~~537,~~042~~601

See accompanying Notes.

Table of Contents

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)

	Common Stock			AdditionalPaid-In Capital		~~AccumulatedOtherComprehensive Loss~~		~~Accumulated~~Retained ~~Equity~~Earnings		Stockholders’ Equity Total
	Shares	Amount
Balance, December 31, 2022	9,049	$	90	$	200,748	$	(31,412)	$	420,603	$	590,029
Balance, December 30, 2023	8,650	$	87	$	165,060			$	469,139	$	634,286
Net income	—	—		—		—		17,~~812~~492		17,~~812~~492
Impact of pension plan, net of tax	—	—		—		239		—		239
Vesting of restricted stock units	19	(a)		(a)				—		—
Vesting of restricted stock units	67	1		(1)		—		—		—
Compensation related to share-based grants	—	—		2,350				—		2,350
Compensation related to share-based grants	—	—		4,569		—		—		4,569
Repurchase of shares to satisfy employee tax withholdings	(7)	—		(907)				—		(907)
Repurchase of shares to satisfy employee tax withholdings	(8)	—		(570)		—		—		(570)
Balance, March 30, 2024	8,662	$	87	$	166,503			$	486,631	$	653,221
Obligation for repurchase of shares to satisfy employee tax withholdings	(19)			(1,319)		—		—		(1,319)
Other	—	—		—		(11)		—		(11)
Balance, April 1, 2023	9,089	$	91	$	203,427	$	(31,184)	$	438,415	$	610,749
Net income	—	—		—		—		24,466		24,466
Impact of pension plan, net of tax	—	—		—		225		—		225
Vesting of restricted stock units	95	—		(1)		—		—		(1)
Compensation related to share-based grants	—	—		1,926		—		—		1,926
Repurchase of shares to satisfy employee tax withholdings	(24)	—		(2,071)		—		—		(2,071)
Obligation for repurchase of shares to satisfy employee tax withholdings	(10)	—		(913)		—		—		(913)
Common stock repurchase and retirement	(142)	(1)		(11,598)		—		—		(11,599)
Other	—	—		—		(11)		—		(11)
Balance, July 1, 2023	9,008	$	90	$	190,770	$	(30,970)	$	462,881	$	622,771
Net income	—	—		—		—		24,382		24,382
Impact of pension plan, net of tax	—	—		—		225		—		225
Vesting of restricted stock units	7	—		—		—		—		—
Compensation related to share-based grants	—	—		2,980		—		—		2,980
Repurchase of shares to satisfy employee tax withholdings	(3)	—		(281)		—		—		(281)
Obligation for shares repurchases not yet settled	(10)	—		(843)		—		—		(843)
Common stock repurchase and retirement	(206)	(2)		(17,720)		—		—		(17,722)
Balance, September 30, 2023	8,796	$	88	$	174,906	$	(30,745)	$	487,263	$	631,512

(a) Activity rounds to less than one thousand dollars.


	Common Stock			Additional Paid-In Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Stockholders’ Equity Total
	Shares	Amount
Balance, December 31, 2022	9,049	$	90	$	200,748	$	(31,412)	$	420,603	$	590,029
Net income	—	—		—		—		17,812		17,812
Other comprehensive income	—	—		—		228		—		228

Vesting of restricted stock units	67	1		(1)		—		—		—
Compensation related to share-based grants	—	—		4,569		—		—		4,569
Repurchase of shares to satisfy employee tax withholdings	(8)	—		(570)		—		—		(570)

Obligation for repurchase of shares to satisfy employee tax withholdings	(19)			(1,319)		—		—		(1,319)

Balance, April 1, 2023	9,089	$	91	$	203,427	$	(31,184)	$	438,415	$	610,749

There has been no activity for Preferred Stock.

See accompanying Notes.

	Common Stock			AdditionalPaid-In Capital		AccumulatedOtherComprehensive Loss		Accumulated Equity		Stockholders’ Equity Total
	Shares	Amount
Balance, January 1, 2022	9,726	$	97	$	268,085	$	(29,360)	$	124,427	$	363,249
Net income	—	—		—		—		133,409		133,409
Impact of pension plan, net of tax	—	—		—		156		—		156
Vesting of restricted stock units	11	—		—		—		—		—
Compensation related to share-based grants	—	—		2,162		—		—		2,162
Repurchase of shares to satisfy employee tax withholdings	(5)	—		(393)		—		—		(393)
Common stock repurchase and retirement	(81)	(1)		(6,426)		—		—		(6,427)
Other	—	—		—		20		—		20
Balance, April 2, 2022	9,651	$	96	$	263,428	$	(29,184)	$	257,836	$	492,176
Net income	—	—		—		—		71,272		71,272
Impact of pension plan, net of tax	—	—		—		156		—		156
Vesting of restricted stock units	181	2		—		—		—		2
Compensation related to share-based grants	—	—		1,775		—		—		1,775
Repurchase of shares to satisfy employee tax withholdings	(66)	(1)		(5,777)		—		—		(5,778)
Common stock repurchase and retirement	(554)	(5)		(38,995)		—		—		(39,000)
Forward contract for accelerated share repurchase agreement	—	—		(21,000)		—		—		(21,000)
Other	—	—		134		(20)		—		114
Balance, July 2, 2022	9,212	$	92	$	199,565	$	(29,048)	$	329,108	$	499,717
Net income	—	—		—		—		59,509		59,509
Impact of pension plan, net of tax	—	—		—		156		—		156
Vesting of restricted stock units	121	1		(1)		—		—		—
Compensation related to share-based grants	—	—		2,092		—		—		2,092
Repurchase of shares to satisfy employee tax withholdings	(51)	(1)		(3,618)		—		—		(3,619)
Common stock repurchase and retirement	(247)	(2)		2		—		—		—
Other	—	—		(134)		(24)		—		(158)
Balance, October 1, 2022	9,035	$	90	$	197,906	$	(28,916)	$	388,617	$	557,697

Table of Contents

See accompanying Notes.

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Nine Months Ended
	Three Months Ended
	September 30, 2023		October 1, 2022
	March 30, 2024		April 1, 2023
Cash flows from operating activities:
Net income	$	6617,~~660~~492	$	~~264~~17,~~190~~812
Adjustments to reconcile net income to cash provided by operations:
Adjustments to reconcile net income to cash (used in) provided by operations:
Depreciation and amortization	239,~~758~~433		197,~~952~~718
Amortization of debt discount and issuance costs	~~989~~330		~~823~~329
Gains from sales of property	—		(144)
Provision for deferred income taxes	(373)		213
Deferred income tax	1,117		(939)
Amortization of deferred gains from real estate	(984)		(984)
Amortization of deferred gains from real estate	(2,952)		(2,951)
Share-based compensation	2,350		4,569
Share-based compensation	9,475		6,029
Changes in operating assets and liabilities:
Accounts receivable	(4659,~~013~~834)		(2047,~~898~~333)
Inventories	~~120~~(27,~~151~~304)		~~(47~~74,~~521)~~989
Accounts payable	4913,~~791~~784		2825,~~197~~420
Taxes payable	—		612
Other current assets	(5,557)		5,953
Pension contributions	—		(677)
Other assets and liabilities	19,528		279
Other current assets	2,621		(440)
Net cash (used in) provided by operating activities	(31,135)		88,965
Other assets and liabilities	5,127		(197)
Net cash provided by operating activities	230,724		246,036
Cash flows from investing activities:
Proceeds from sale of assets	~~191~~127		~~648~~37
Property and equipment investments	(185,~~938~~447)		(199,~~079~~008)
Net cash used in investing activities	(185,~~747~~320)		(188,~~431~~971)
Cash flows from financing activities:
Common stock repurchase and retirement	(29,321)		(66,427)
Repurchase of shares to satisfy employee tax withholdings	(907)		(570)
Repurchase of shares to satisfy employee tax withholdings	(5,157)		(9,788)
Principal payments on finance lease liabilities	(3,072)		(2,133)
Principal payments on finance lease liabilities	(6,659)		(7,229)
Net cash used in financing activities	(3,979)		(2,703)
Net cash used in financing activities	(41,137)		(83,444)
Net change in cash and cash equivalents	(40,434)		77,291
Net change in cash and cash equivalents	170,840		144,161
Cash and cash equivalents at beginning of period	521,743		298,943
Cash and cash equivalents at beginning of period	298,943		85,203
Cash and cash equivalents at end of period	$	481,309	$	376,234
Cash and cash equivalents at end of period	$	469,783	$	229,364
Supplemental cash flow information:
Interest paid during the period	$	276,~~948~~796	$	246,~~824~~190
Taxes paid during the period	$	171,~~682~~342	$	~~90,626~~—
Non-cash transactions:
Property and equipment acquired under finance leases	$	11,277	$	5,995
Obligation for repurchase of shares to satisfy employee tax withholdings	$	—	$	1,319
Obligation for shares repurchases not yet settled	$	843	$	—

See accompanying Notes.

Table of Contents

BLUELINX HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

~~September~~March 30, ~~2023~~2024

(Unaudited)

1. Basis of Presentation and ~~Summary of~~ Significant Accounting Policies

~~Basis~~BlueLinx Holdings Inc., including consolidated subsidiaries (collectively, the “Company”), is a leading wholesale distributor of ~~Presentation~~residential and commercial building products in the United States. The Company is a two-step distributor and purchases products from manufacturers and distributes those products to dealers and other suppliers in local markets, who then sell those products to end users. The Company carries a broad portfolio of both branded and private-label stock keeping units (“SKUs”) across two principal product categories: specialty products and structural products. Specialty products include items such as engineered wood, siding, moulding and millwork, outdoor living, specialty lumber and panels, and industrial products. Structural products include items such as lumber, plywood, oriented strand board, rebar, and remesh. The Company also provides a wide range of value-added services and solutions aimed at relieving distribution and logistics challenges for its customers and suppliers, while enhancing their marketing and inventory management capabilities.

The ~~accompanying~~Company’s unaudited ~~interim~~ condensed consolidated financial statements ~~include~~and ~~the~~accompanying ~~accounts~~notes ofhave ~~BlueLinx~~been ~~Holdings~~prepared ~~Inc.~~using ~~and~~generally ~~its~~accepted ~~wholly~~accounting ~~owned~~principles ~~subsidiaries~~in (the United States (“~~Company~~GAAP”) and the interim reporting guidance of the U.S. Securities and Exchange Commission (“SEC”). The Company is composed of a single reportable segment for financial reporting purposes. WeThe ~~derived~~Company’s ~~the condensed~~ consolidated balance sheet as of December 3130, ~~2022~~2023 contained herein was derived from the audited consolidated ~~financial~~balance ~~statements~~sheet included in ~~our~~the Company’s Annual Report on Form 10-K for the fiscal year ended December 3130, ~~2022~~2023 (the “~~Fiscal~~2023 ~~2022~~ Form 10-K”), as filed with the Securities and Exchange Commission (“SEC”) on February 2120, ~~2023~~2024. In the opinion of ~~our~~the Company’s management, the unaudited condensed consolidated financial statements reflect all adjustments, which are of a normal recurring nature, necessary for a fair presentation of ~~our~~the ~~statements~~Company’s results of operations and comprehensive income for the three ~~and nine~~ months ended ~~September~~March 30, ~~2023~~2024 and ~~October~~April 1, ~~2022~~2023, ~~our~~financial ~~balance~~condition ~~sheets~~ as of ~~September~~March 30, ~~2023~~2024 and December 3130, ~~2022~~2023, ~~our~~changes ~~statements~~in of stockholders’ equity for the ~~nine~~three months ended ~~September~~March 30, ~~2023~~2024 and ~~October~~April 1, ~~2022~~2023, and ~~our statements of~~ cash flows for the ~~nine~~three months ended ~~September~~March 30, ~~2023~~2024 and ~~October~~April 1, ~~2022~~2023.

WeThe ~~have~~Company has condensed or omitted certain notes and other information from the ~~interim~~unaudited condensed consolidated financial statements presented in this report. Therefore, these ~~interim~~ condensed ~~consolidated~~ financial statements and accompanying notes should be read in conjunction with the ~~Fiscal~~Company’s ~~2022~~2023 Form 10-K. The results for the three ~~and nine~~ months ended ~~September~~March 30, ~~2023~~2024 are not necessarily indicative of results that may be expected for the full fiscal year ending December 3028, ~~2023~~2024, or any other interim period.

WeThe ~~operate~~Company operates on a 5-4-4 fiscal calendar. ~~Our~~and its fiscal year ends on the Saturday closest to December 3131st of each fiscal year and may comprise 53 weeks in certain years. ~~Our~~Fiscal ~~2023~~2024 ~~fiscal year~~ contains 52 weeks and ~~ends~~will end on December 3028, ~~2023~~2024. Fiscal ~~2022~~2023 contained 52 weeks and ended on December 3130, ~~2022~~2023.

~~Our~~The ~~financial~~fair ~~statements~~value ~~are~~of ~~prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”)~~cash, ~~which~~cash ~~requires us to make estimates based on assumptions about current and~~equivalents, ~~for~~accounts ~~some estimates~~receivable, ~~future~~accounts ~~economic~~payable and ~~market~~accrued ~~conditions~~liabilities, ~~which~~to ~~affect~~the ~~reported~~extent ~~amounts~~the ~~and~~underlying ~~related~~liability ~~disclosures~~will inbe ~~our~~settled ~~financial~~in ~~statements. Although our current estimates contemplate current and expected future conditions~~cash, asapproximates ~~applicable,~~the itcarrying isvalues ~~reasonably~~because ~~possible~~of ~~that~~the ~~actual~~short-term ~~conditions~~nature ~~could differ from our expectations, which could materially affect our results~~ of ~~operations~~these ~~and financial position~~instruments.

~~Reclassification~~Use of ~~Prior Period Presentation~~Estimates

~~For~~The ~~the~~preparation ~~nine~~of ~~months~~financial ~~ended~~statements ~~October 1,~~in ~~2022,~~conformity wewith ~~have~~GAAP ~~reclassified~~requires ~~certain items within~~ the ~~presentation~~Company’s ofmanagement ~~our statement of cash flows~~ to ~~align~~make ~~with~~estimates ~~our~~based ~~statement~~on ofassumptions ~~cash~~about ~~flows~~current ~~presentation~~and, for ~~the~~some ~~nine months ended September 30~~estimates, ~~2023.~~future ~~Our~~economic ~~reclassifications~~and ~~are~~market ~~limited~~conditions, towhich ~~the~~affect ~~operating~~reported ~~activities~~amounts ~~section~~ and ~~include~~related ~~presenting~~disclosures ~~pension~~in ~~contributions,~~the ~~which~~Company’s ~~were~~financial ~~previously~~statements. ~~presented~~Although ~~within~~current ~~the~~estimates ~~change~~contemplate ofcurrent ~~other~~and ~~assets~~expected ~~and~~future ~~liabilities~~conditions, as anapplicable, ~~individual~~it ~~item~~is ~~within~~reasonably ~~changes~~possible inthat ~~operating~~actual ~~assets~~conditions ~~and~~could ~~liabilities.~~differ ~~These~~from ~~reclassifications,~~management’s ~~we believe~~expectations, ~~provide~~which ancould ~~enhanced~~materially ~~level~~affect ~~of transparency with regards to~~ the ~~presentation~~Company’s results of ~~our~~operations ~~statement~~and offinancial ~~cash flows~~position.

~~Recently Adopted Accounting Standards~~5

~~Credit~~Table Impairment Losses. In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments - Credit Losses (Topic 326).” This ASU sets forth a current expected credit loss (“CECL”) model which requires the measurement of all expected credit losses for financial instruments or other assets (e.g., trade receivables), held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the former incurred loss model applicable to the measurement of credit losses on financial assets measured at amortized cost, and applies to some off-balance sheet credit exposures. The standard also requires enhanced disclosures to help financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity's portfolio. The Company adopted this standard on a Contents

Significant Accounting Policies

The Company has made no material changes to its significant accounting policies described in the notes to its consolidated financial statement included in its 2023 Form 10-K. The Company did not adopt any new accounting standards during the fiscal year ended December 30, 2023, or the three months ended March 30, 2024.

Recent Accounting Standards - Adoption Pending

Segment Reporting Improvements. On November 27, 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures (“ASU 2023-07”). The FASB issued the new guidance primarily to provide financial statement users with more disaggregated expense information about a public business entity’s (“PBE”) reportable segment(s). This ASU will require PBEs to provide incremental disclosures related to the entity’s reportable segment(s), including disclosures for expenses that are both 1) significant to each reportable segment and are provided regularly to the Chief Operating Decision Maker (“CODM”) or easily computed from information regularly provided to the CODM and 2) included in the reported measure of segment profit or loss used by the CODM to assess performance and allocate resources. If a PBE does not disclose any significant segment expenses for a reportable segment, it is required to disclose narratively the nature of the expenses used by the CODM to manage each segment’s operations. Under the provisions of this ASU, all of the disclosures required in the segment guidance, including disclosing a measure of segment profit or loss used by the CODM and reporting significant segment expenses, applies to all PBEs, including those with a single operating or reportable segment. However, this ASU does not change the definition of a segment, the method for determining segments, or the criteria for aggregating operating segments into reportable segments. ASU 2023-07 will be effective for the Company’s annual reporting period for fiscal 2024 and all interim reporting periods beginning in fiscal 2025. At adoption, the disclosures are retrospectively presented for all comparative periods presented. Since this new ASU addresses only disclosures, the Company does not expect the adoption of this ASU to have any material effects on its financial condition, results of operations or cash flows. The Company is currently evaluating any new disclosures that may be required upon adoption of ASU 2023-07.

Income Tax Disclosure Improvement. On December 14, 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”), which establishes new income tax disclosure requirements in addition to modifying and eliminating certain existing requirements. Under the new guidance, entities must consistently categorize and provide greater disaggregation of information in the rate reconciliation. They must also further disaggregate income taxes paid. The ASU’s disclosure requirements apply to all entities subject to Accounting Standards Codification (“ASC”) No. 740, Income Taxes (“ASC 740”). The overall objective of these disclosure requirements is for an entity, particularly an entity operating in multiple jurisdictions, to disclose sufficient information to enable users of financial statements to understand the nature and magnitude of factors contributing to the difference between the effective tax rate and the statutory tax rate. ASU 2023-09 will be effective for the Company for the fiscal 2025 annual reporting period. Since this new ASU addresses only disclosures, the Company does not expect the adoption of this ASU to have any material effects on its financial condition, results of operations or cash flows. The Company is currently evaluating any new disclosures that may be required upon adoption of ASU 2023-09.

2. Inventories

The Company’s inventories consist almost entirely of finished goods inventory, with a very limited amount of work-in-process inventory. The cost of all inventories is determined by the moving average cost method. The Company included all material charges directly incurred in bringing inventory to its existing condition and location, including the cost of inbound freight, volume incentives, inventory adjustments, tariffs, duties and other import fees. The Company evaluates its inventory value at the end of each quarter to ensure that inventory, when viewed by category, is carried at the lower of cost or net realizable value, which also considers items that may be considered damaged, excess, and obsolete inventory. As of March 30, 2024, the Company assessed the carrying value of its inventory and determined it was presented at the lower of cost or net realizable value and that a reserve was not necessary. As of December 30, 2023, the Company also had no such inventory reserve.

Substantially all of the amount reported in Cost of products sold on the Company’s consolidated statement of operations is composed of costs incurred to purchase inventory that is subsequently resold to customers, including costs related to import duties and tariffs. Import duties and tariffs are not typically passed through to customers as separately billed charges. Certain import duties are classified by the U.S. Department of Commerce (the “Commerce Department”) as “antidumping or countervailing duties,” and these duties may be subject to periodic review and adjustments by the Commerce Department through a process known as a trade remedy administrative review, which can result in both retroactive and prospective adjustments to duty rates. At the time of importation, the Company tenders antidumping duty and countervailing duty cash deposits (as use of that term has been defined by the Commerce Department) to the U.S. Customs and Border Protection (“U.S.

~~modified~~Table ~~retrospective basis in the first quarter~~ of ~~2022 and the implementation did not have a material impact to the Company’s condensed consolidated financial statements.~~Contents

~~Reference~~Customs”) ~~Rate~~and ~~Reform.~~accounts Infor ~~March~~duties ~~2020~~and tariffs based on the then-current rates in effect, and records any retroactive adjustments in the ~~FASB~~period ~~issued~~in ~~ASU~~which NoU.S. ~~2020-04,~~Customs ~~“Reference~~determines ~~Rate~~final ~~Reform~~duty rates at the time entries subject to antidumping and countervailing duties liquidate (~~Topic~~as ~~848~~use of that term has been defined by the Commerce Department):, ~~Facilitation~~typically ofthrough the ~~Effects~~resolution of ~~Reference~~a ~~Rate~~trade ~~Reform~~remedy onadministrative ~~Financial~~review ~~Reporting~~proceeding.” ~~The~~During ~~standard~~the ~~provides~~three ~~temporary~~months ~~guidance~~ended toMarch 30, ~~ease~~2024, the ~~potential~~Company ~~burden~~received inrefunds ~~accounting~~of ~~for~~$16.9 ~~reference~~million, ~~rate~~plus ~~reform~~interest ~~primarily~~of ~~resulting~~$2.0 ~~from~~million, ~~the~~related ~~discontinuation~~to ofretroactive ~~the~~adjustments ~~publication~~associated ofwith certain ~~tenors~~antidumping ofduties for imported wood moulding and millwork products. The antidumping duty cash deposits were originally paid and accounted for by the ~~London~~Company ~~Inter~~in prior reporting periods at the then-~~bank~~current ~~Offered~~rates. ~~Rate~~Impacted ~~(“LIBOR”)~~inventories onhave ~~December~~since ~~31,~~been ~~2021,~~sold. ~~with~~These ~~complete~~adjustment ~~elimination~~amounts are reflected in Costs of products sold and Interest expense, net, respectively, on the ~~publication~~Company’s unaudited condensed consolidated statement of operations for the ~~LIBOR~~three bymonths ~~June~~ended March 30, ~~2023~~2024. ~~The~~See ~~amendments~~Note in9, ~~this~~Commitments ~~ASU are elective~~ and ~~apply~~Contingencies, tofor ~~all~~disclosure ~~entities~~concerning ~~that~~another ~~have~~matter ~~contracts~~related ~~referencing~~to ~~the~~import ~~LIBOR~~duties.

~~The~~3. Goodwill Company’s revolving credit agreement, as further discussed in Note 6, Long-Term Debt, to these condensed consolidated financial statements, was amended on June 27, 2023, to replace references to LIBOR with Secured Overnight Financing Rate (“SOFR”) for determining interest payable on current and ~~future~~Other ~~borrowings.~~Intangible The guidance in this ASU provides a practical expedient which simplifies accounting analyses under current U.S. GAAP for contract modifications if the change is directly related to a change from the LIBOR to a new interest rate index. The Company adopted this standard prospectively in the first quarter of 2022. The implementation did not have a material impact on the Company’s condensed consolidated financial statements or to any key terms of our revolving credit agreement other than the discontinuation of LIBOR.Assets

2As a result of merger and acquisition activities, the Company’s consolidated balance sheet reflects goodwill along with other intangible assets for customer relationships, noncompete agreements, and trade names. As ~~Business~~of ~~Combinations~~March 30, 2024, the only changes since December 30, 2023 were for amortization of intangible assets.

On October 3, 2022, we acquired all the outstanding stock of Vandermeer Forest Products, Inc. (“Vandermeer”), a premier wholesale distributor of building products, for preliminary total consideration of $69.3 million. The acquisition has been accounted for as a business combination using the acquisition method. The assets acquired and liabilities assumed were recognized at their acquisition date fair values. During the first fiscal quarter of 2023, $0.3 million was returned to the Company for adjustments related to final cash and working capital balances, reducing preliminary total consideration from $69.3 million to $69.0 million.

The acquisition accounting, including fair value estimations, is subject to change as we finalize assessments of the assets and liabilities that were acquired on the acquisition date. The primary area of the preliminary acquisition accounting that is not yet finalized relates to the fair value of certain liabilities that are subject to seller reimbursement via a cash escrow bank account that was funded through the holdback of $6.3 million of the purchase price. During the third quarter of fiscal 2023, $1.6 million of this escrow amount was returned to the seller under the terms of the stock purchase agreement and the escrow arrangement that provide for scheduled return of the unused balance in the escrow account. As of September 30, 2023, the remaining balance in the escrow account is $4.8 million and any unused amounts are scheduled to be returned to the seller within approximately 18 months after the acquisition date.

3. Inventories

Our inventories consist almost entirely of finished goods inventory, with an immaterial amount of work-in-process inventory. The cost of all inventories is determined by the moving average cost method. We have included all material charges directly incurred in bringing inventory to its existing condition and location. We evaluate our inventory value at the end of each quarter to ensure that inventory, when viewed by category, is carried at the lower of cost or net realizable value, which also considers items that may be considered damaged, excess, and obsolete inventory.

As of September 30, 2023, we recorded a lower of cost or net realizable value reserve of $0.6 million as a result of the decrease in the value of our structural lumber inventory related to the decline in wood-based commodity prices as of the end of the period.

As of December 31, 2022, we recorded a lower of cost or net realizable value reserve of $2.6 million as a result of the decrease in the value of our structural lumber and panel inventory related to the decline in wood-based commodity prices as of the end of the period.

4. Goodwill and Other Intangible Assets

In connection with our past merger and acquisition activity, we acquired certain intangible assets. As of September 30, 2023, our intangible assets consist of goodwill and other intangible assets including customer relationships, noncompete agreements, and trade names.

Goodwill

~~Goodwill~~The Company does not amortize its goodwill but must assess its goodwill for impairment at least annually, either quantitatively or qualitatively. Under GAAP, goodwill is assessed at the ~~excess~~reporting ofunit level. Since the ~~cost~~Company is composed of anone ~~acquired~~reporting ~~entity~~unit, ~~over~~the Company’s goodwill is assessed at the ~~fair~~enterprise ~~value~~level. The most recent scheduled annual impairment assessment for goodwill was conducted quantitatively as of ~~tangible~~October ~~and~~1, ~~intangible~~2023. ~~assets~~Based ~~(including~~on ~~customer~~that ~~relationships~~assessment, ~~noncompete~~the ~~agreements~~Company’s management, ~~and~~with ~~trade~~the ~~names)~~assistance ~~acquired~~of an independent expert, ~~and~~concluded ~~liabilities~~that ~~assumed~~goodwill was not impaired, ~~under~~meaning ~~acquisition~~the ~~accounting~~fair ~~for~~value ~~business~~of ~~combinations.~~the Asenterprise exceeded the carrying value of ~~September 30,~~the ~~2023~~enterprise, ~~goodwill~~including ~~was $55~~goodwill.4 ~~million.~~

~~Goodwill~~In isaddition ~~not subject~~ to ~~amortization but must be tested for impairment at least annually. This test requires us to assign goodwill to a reporting unit and to determine if~~ the ~~fair~~annual ~~value of the reporting unit’s goodwill is less than its carrying amount. We evaluate goodwill for~~ impairment ~~during~~assessments ~~the~~described ~~fourth quarter of each fiscal year. In addition~~above, ~~we will evaluate~~ the ~~carrying~~Company ~~value~~will assess for impairment between the annual impairment ~~tests~~assessments if anevents ~~event~~occur, ~~occurs~~ or circumstances materially change, that ~~would~~ indicate ~~the~~a ~~carrying~~potential ~~amount~~goodwill impairment may ~~be impaired~~exists. ~~Such~~During ~~events~~the ~~and~~three ~~indicators~~months ~~may~~ended ~~include~~March 30, ~~without limitation~~2024, ~~significant declines in~~ the ~~industries~~Company indid ~~which~~not ~~our~~note ~~products~~any ~~are used, significant changes in capital market conditions, and significant changes in our market capitalization. No such~~ indicators ~~were~~of ~~noted~~potential ~~during~~impairment ~~the~~for ~~first~~its ~~nine months of fiscal 2023~~goodwill.

As of March 30, 2024 and December 30, 2023, the carrying value of the Company’s goodwill was $55.4 million.

Definite-Lived Intangible Assets

The gross carrying amounts, accumulated amortization, and net carrying amounts of ~~our~~the Company definite-lived intangible assets asat ~~of September~~March 30, ~~2023~~2024 were as follows:

Intangible Asset	Weighted Average Remaining Useful Lives (Years)	Gross Carrying Amounts		AccumulatedAmortization(1)		Net Carrying Amounts
		(Dollar amounts in thousands)
		($ in thousands)
Customer relationships	109	$	48,500	$	(1719,~~909~~722)	$	3028,~~591~~778
Noncompete agreements	4	8,954		(8,~~394~~464)		~~560~~490
Trade names	2	7,826		(7,~~160~~326)		~~666~~500
Total		$	65,280	$	(3335,~~463~~512)	$	3129,~~817~~768

(1) Intangible assets except customer relationships are amortized on a straight line basis. Certain of our customer relationships are amortized on a double declining balance method and certain others are amortized on a straight line basis.

Amortization Expense

Amortization expense for ~~our~~ definite-lived intangible assets was approximately $1.0 million and $31.21 million for the three-months ~~and nine month periods~~ ended ~~September~~March 30, ~~2023,~~2024 ~~respectively. For the three~~ and ~~nine month periods ended October~~April 1, ~~2022~~2023, ~~amortization expense was $0.5 million and $2.2 million,~~ respectively.

~~Estimated amortization expense for definite-lived intangible assets for the remaining portion of 2023 and the next five fiscal years is as follows:~~7

Fiscal Year	Estimated Amortization
	(In thousands)
2023	$	1,033
2024	3,930
2025	3,765
2026	3,471
2027	3,340
2028	3,340

Table of Contents

Estimated amortization expense for definite-lived intangible assets for the remaining portion of 2024 and the next five fiscal years is as follows:


Fiscal Year	Estimated Amortization
	(In thousands)
2024	$	2,897
2025	3,765
2026	3,471
2027	3,340
2028	3,340
2029	3,340

4. Revenue Recognition

The following table presents the Company’s revenues disaggregated by product type. Sales and usage-based taxes are excluded from revenues.


	Three Months Ended
Product type	March 30, 2024		April 1, 2023
	(In thousands)
Specialty products	$	503,834	$	567,838
Structural products	222,410		230,066
Total net sales	$	726,244	$	797,904

The following table presents the Company’s revenues disaggregated by sales channel. Sales and usage-based taxes are excluded from revenues.


	Three Months Ended
Sales channel	March 30, 2024		April 1, 2023
	(In thousands)
Warehouse and reload	$	591,768	$	686,632
Direct	149,750		127,095
Customer discounts and rebates	(15,274)		(15,823)
Total net sales	$	726,244	$	797,904

Warehouse sales are delivered from Company warehouses. Reload sales are similar to warehouse sales but are shipped from warehouses, most of which are operated by third parties, where the Company stores owned products to enhance operating efficiencies. This channel is employed primarily to service strategic customers that would be less economical to service from Company warehouses, and to distribute large volumes of imported products from port facilities. Direct sales are shipped from the manufacturer to the customer without the Company taking physical possession of the inventory and, as a result, typically generate lower margins than warehouse and reload distribution channels but require lower amount of committed capital and fixed costs.

Performance obligations in contracts with customers generally consist solely of delivery of goods.

5.Table ~~Revenue~~of ~~Recognition~~Contents

We5. ~~recognize~~Debt revenue when the following criteria are met: (1) Contract with the customer has been identified; (2) Performance obligations in the contract have been identified; (3) Transaction price has been determined; (4) Transaction price has been allocated to the performance obligations; and ~~(5)~~Finance ~~When (or as) performance obligations are satisfied.~~ Leases

~~Contracts~~As ~~with our customers are generally in the form~~ of ~~standard~~March 30, ~~terms~~2024 and ~~conditions of sale. From time to time~~December 30, ~~we may enter into specific contracts~~2023, ~~which~~outstanding ~~may~~debt ~~affect delivery terms. Performance obligations in our contracts generally consist solely of delivery of goods. For all sales channel types, consisting of warehouse, direct,~~ and ~~reload~~finance ~~sales,~~leases weconsisted ~~typically satisfy our performance obligations upon shipment. Our customer payment terms are typical for our industry, and may vary by the type and location~~ of ~~our customer and~~ the products or services offered. The term between invoicing and when payment is due is not deemed to be significant by us. For certain sales channels and/or products, our standard terms of payment may be as early as ten days.following:

In addition, we provide inventory to certain customers through pre-arranged agreements on a consignment basis. Customer consigned inventory is maintained and stored by certain customers; however, ownership and risk of loss remain with us.


	March 30, 2024		December 30, 2023
	(In thousands)
Senior secured notes (1)	$	300,000	$	300,000
Revolving credit facility (2)	—		—

Finance lease obligations (3)	292,067		285,426
	592,067		585,426
Unamortized debt issuance costs	(3,043)		(3,246)
Unamortized bond discount costs	(2,884)		(3,011)
	586,140		579,169
Less: current portions of finance lease obligations	12,157		11,178
Total debt and finance lease obligations, net of current portions	$	573,983	$	567,991

~~All~~(1)As ~~revenues recognized are net~~ of ~~trade~~March 30, ~~allowances~~2024 ~~(i.e.~~and December 30, ~~rebates)~~2023, ~~cash~~long-term ~~discounts,~~debt ~~and~~was ~~sales~~comprised ~~returns~~of $300.0 ~~Cash~~million ~~discounts~~of ~~and~~senior ~~sales~~secured ~~returns~~notes ~~are~~issued ~~estimated~~in ~~using~~October ~~historical experience~~2021. ~~Trade~~These ~~allowances~~notes are ~~based~~presented onunder the ~~estimated~~long-term ~~obligations~~debt ~~and~~caption ~~historical~~of ~~experience.~~our ~~Adjustments~~consolidated tobalance ~~earnings~~sheets ~~resulting~~at ~~from~~$294.1 ~~revisions~~million toand ~~estimates~~$293.7 onmillion ~~discounts~~as of March 30, 2024 and ~~returns~~December 30, ~~have~~2023, ~~been~~respectively. ~~insignificant~~This ~~for~~presentation ~~each~~is net of ~~the~~discount ~~reported~~of ~~periods~~$2.9 ~~Certain~~million ~~customers~~and ~~may~~$3.0 ~~receive~~million ~~cash-based~~and ~~incentives~~the orcombined ~~credits,~~carrying ~~which~~value ~~are~~of ~~accounted~~debt ~~for~~issuance ascosts ~~variable~~of ~~consideration~~$3.0 Wemillion ~~estimate~~and ~~these~~$3.2 ~~amounts~~million ~~based~~as onof ~~the~~March 30, ~~expected~~2024 ~~amount~~and toDecember 30, be2023, ~~provided~~respectively. toThe ~~customers~~senior ~~and~~secured ~~reduce~~notes ~~revenues~~are ~~recognized.~~presented Wein ~~believe~~the ~~that~~above ~~there~~table ~~will~~at ~~not~~face bevalue ~~significant~~and ~~changes~~have toan ~~our~~annual ~~estimates~~interest rate of ~~variable~~6.0% ~~consideration~~through maturity.

~~The~~(2) ~~following~~No ~~table~~borrowings ~~presents~~were ~~our~~outstanding ~~revenues~~on ~~disaggregated~~this byrevolving ~~revenue~~credit ~~source~~facility during the three months ended March 30, 2024 or fiscal year 2023. Available ~~Sales~~borrowing capacity under this revolving credit facility was $346.5 million as of March 30, 2024 and ~~usage-based~~December 30, ~~taxes~~2023. The ~~are~~available ~~excluded~~borrowing ~~from~~capacity ~~revenues~~reflects undrawn letters of credit.

	Three Months Ended				Nine Months Ended
Product type	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
	(In thousands)				(In thousands)
Specialty products	$	558,851	$	724,323	$	1,697,679	$	2,280,090
Structural products	251,130		336,438		726,173		1,322,355
Total net sales	$	809,981	$	1,060,761	$	2,423,852	$	3,602,445

(3) Refer to Note 8, Lease Commitments, for interest rates associated with finance lease obligations.

~~The~~Interest ~~following~~expense, ~~table~~net ~~presents~~on ~~our~~the ~~revenues~~Company’s ~~disaggregated~~unaudited bycondensed ~~sales~~consolidated ~~channel.~~statements ~~Warehouse~~of ~~sales~~operations ~~are~~for ~~delivered~~the ~~from~~three ~~our~~months ~~warehouses.~~ended ~~Reload~~March 30, ~~sales~~2024 ~~are~~and ~~similar~~April 1, to2023 ~~warehouse~~consists ~~sales~~of ~~but~~interest ~~are~~expense ~~shipped~~of ~~from~~$13.1 ~~warehouses~~million and $11.3 million, ~~most~~respectively, ofand ~~which~~interest ~~are~~income ~~operated~~of by$8.5 ~~third~~million ~~parties,~~and ~~where~~$3.6 wemillion, ~~store~~respectively. ~~owned~~Interest ~~products~~expense toreflects ~~enhance~~amortization ~~our~~of ~~operating~~debt ~~efficiencies.~~issuance ~~This~~costs ~~channel~~and isbond ~~employed~~discount ~~primarily~~costs toof ~~service~~$0.3 ~~strategic~~million ~~customers~~and ~~that~~$0.3 ~~would~~million befor ~~less~~first ~~economical~~quarter to2024 ~~service~~and ~~from~~first ~~our~~quarter ~~warehouses~~2023, ~~and~~respectively. toIncluded ~~distribute~~in ~~large~~interest ~~volumes~~income offor ~~imported~~the ~~products~~three ~~from~~months ~~port~~ended ~~facilities~~March 30, 2024 is $2.0 ~~Direct~~million ~~sales~~received ~~are~~with ~~shipped~~refunds from ~~the~~U.S. ~~manufacturer~~Customs tofor ~~the~~antidumping ~~customer~~import ~~without~~duties ~~our~~(see ~~taking~~Note ~~physical~~2, ~~possession~~Inventories). Interest ofexpense for the ~~inventory~~three ~~and,~~months asended ~~a result~~March 30, ~~typically~~2024 ~~generate~~also ~~lower~~includes ~~margins~~$1.6 ~~than~~million ~~our~~of ~~warehouse~~accrued ~~and~~estimated ~~reload~~interest ~~distribution~~expense ~~channels.~~related ~~This~~to ~~distribution~~import ~~channel~~duties ~~requires~~that the ~~lowest~~Company ~~amount~~believes ofit ~~committed~~may ~~capital~~owe ~~and~~(see ~~fixed~~Note ~~costs.~~9, ~~Sales~~Commitments and ~~usage-based taxes are excluded from revenues~~Contingencies).

	Three Months Ended				Nine Months Ended
Sales channel	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
	(In thousands)				(In thousands)
Warehouse and reload	$	683,072	$	889,349	$	2,065,212	$	2,987,636
Direct	143,026		193,446		405,335		680,333
Customer discounts and rebates	(16,117)		(22,034)		(46,695)		(65,524)
Total net sales	$	809,981	$	1,060,761	$	2,423,852	$	3,602,445

6. Long-Term Debt

As of September 30, 2023, and December 31, 2022, long-term debt consisted of the following:

	September 30, 2023		December 31, 2022
	(In thousands)
Senior secured notes (1)	$	300,000	$	300,000
Revolving credit facility (2)	—		—
Finance lease obligations (3)	277,343		273,075
	577,343		573,075
Unamortized debt issuance costs	(3,449)		(4,057)
Unamortized bond discount costs	(3,138)		(3,519)
	570,756		565,499
Less: current portion of finance lease obligations	9,813		7,089
Long-term debt, net of current portion	$	560,943	$	558,410

(1)As of September 30, 2023 and December 31, 2022, our long-term debt was comprised of $300.0 million of senior secured notes issued in October 2021. These notes are presented under the long-term debt caption of our condensed consolidated balance sheets at $293.4 million and $292.4 million as of September 30, 2023 and December 31, 2022, respectively. This presentation is net of their discount of $3.1 million and $3.5 million and the combined carrying value of our debt issuance costs of $3.4 million and $4.1 million as of September 30, 2023 and December 31, 2022, respectively. Our senior secured notes are presented in this table at their face value.

(2) The average effective interest rate for our revolving credit facility was zero percent for the fiscal quarters ended September 30, 2023 and October 1, 2022 since no borrowings were outstanding during those periods.

(3) Refer to Note 9, Leases, for interest rates associated with finance lease obligations.

Senior Secured Notes

In October 2021, wethe Company and certain subsidiaries completed a private offering of $300.0 million of ~~our~~ 6.0% percent senior secured notes due 2029 (the “2029 Notes”), and in connection therewith we entered into an indenture (the “Indenture”) with the subsidiary guarantors ~~party thereto~~ and Truist Bank, as trustee and collateral agent. The 2029 Notes were issued to investors at 98.625% ~~percent~~ of their principal amount. The 2029 Notes are secured by a first-priority security interest in substantially all of the Company’s assets, other than accounts receivables, inventory, deposit accounts, securities accounts, business interruption insurance and ~~will~~other related assets. The 2029 Notes are scheduled to mature on November 15, 2029., ~~The~~however ~~majority~~at ofthe ~~net~~sole ~~proceeds~~discretion ~~from~~of the ~~offering~~Company, of the ~~2029~~notes ~~Notes~~may ~~were~~be ~~used~~redeemed, in whole or in part, prior to ~~repay~~scheduled ~~borrowings~~maturity. ~~under~~Early ~~our~~redemptions ~~Revolving~~made ~~Credit~~by ~~Facility~~the Company prior to November 15, 2026 would require the Company to pay a redemption premium, as defined ~~below~~in the Indenture. Interest expense for the 2029 Notes totaled $4.5 million for the three months ended March 30, 2024 and April 1, 2023.

As of ~~September~~March 30, ~~2023~~2024 and December 3130, ~~2022~~2023, the fair value of ~~our~~the Company’s 2029 Notes was approximately $~~271~~291.59 million and $~~283~~273.62 million, respectively, which were estimated from inputs that are designated as Level 2 in the fair value hierarchy. ~~Our~~The Company’s valuation technique is based primarily on observable market prices in less active markets.

Revolving Credit Facility

Our revolving credit facility, entered into with Wells Fargo Bank, National Association, as administrative agent (the “Agent”), and certain other financial institutions party thereto, provides for a senior secured asset-based revolving loan and letter of credit facility of up to $350.0 million. Our obligations under the Revolving Credit Facility (as defined below) are secured by a security interest in substantially all of our and our subsidiaries’ assets (other than real property), including inventories, accounts receivable, and proceeds from those items. On June 27, 2023, we entered in to a third amendment to the credit facility to, among other things, replace the interest rate based on LIBOR applicable to borrowings under the Credit Agreement with an interest rate based on the SOFR and a customary spread adjustment (as amended, the “Revolving Credit Facility”).9

~~Our~~Table ~~Revolving~~of ~~Credit Facility includes available interest rate options and was previously based on LIBOR, which was discontinued as an available rate option after June 30, 2023.~~ Contents

~~Borrowings~~In ~~under~~April ~~our~~2018, ~~Revolving~~the ~~Credit~~Company ~~Facility~~and ~~bear~~certain ~~interest~~subsidiaries atentered into the Amended and Restated Credit Agreement for a ~~rate~~revolving ~~per~~credit ~~annum~~facility ~~equal~~with toWells ~~(i)~~Fargo ~~Adjusted~~Bank, ~~Term~~National ~~SOFR~~Association, as administrative agent (~~calculated~~“the asAgent”), ~~SOFR~~and ~~plus~~certain 0other financial institutions.~~1%)~~ ~~plus~~In August 2021, the Company entered into a ~~margin~~second ~~ranging~~amendment ~~from~~to ~~1.25~~this ~~percent~~revolving credit facility to, ~~1.75~~among ~~percent~~other things, ~~with~~extend the ~~margin~~maturity ~~determined~~date ~~based~~of ~~upon~~the ~~average~~facility ~~excess~~to ~~availability~~August ~~for~~2, 2026, and reduce the ~~immediately~~interest ~~preceding~~rate ~~fiscal~~on ~~quarter~~borrowings ~~for~~under ~~loans~~the facility, and in June 2023, the Company entered into a third amendment to this revolving credit facility to, among other things, replace the interest rate based on ~~SOFR,~~the orLondon interbank offered rate (ii“LIBOR”) thereunder with an interest rate based on the ~~Agent’s~~secured ~~base~~overnight financing rate ~~plus~~(“SOFR”) and a ~~margin~~customary ~~ranging~~spread adjustment (as amended, the “Revolving Credit Facility”). In October 2021, in conjunction with the offering of the 2029 Notes, the Company reduced the credit limit of the Revolving Credit Facility from $600.0 million to $350.250 million. ~~percent~~The Revolving Credit Facility provides for a senior secured asset-based revolving loan and letter of credit facility of up to $350.0 million, as amended.75 ~~percent,~~The ~~with~~obligations under the ~~margin~~Revolving ~~based~~Credit ~~upon~~Facility ~~average~~are ~~excess~~secured ~~availability~~by ~~for~~a security interest in substantially all of the ~~immediately~~Company’s ~~preceding~~and ~~fiscal~~its ~~quarter~~subsidiaries’ ~~for~~assets ~~loans~~(other ~~based~~than onreal property), including inventories, accounts receivable, and proceeds from those items, under the ~~base~~Amended ~~rate~~and Restated Guaranty and Security Agreement.

10From and after June 30, 2023, borrowings under the Revolving Credit Facility bear interest at a rate per annum equal to (i) Adjusted Term SOFR (calculated as SOFR plus 0.1%) plus a margin ranging from 1.25 percent to 1.75 percent, with the margin determined based upon average excess availability for the immediately preceding fiscal quarter for loans based on SOFR, or (ii) the Agent’s base rate plus a margin ranging from 0.25 percent to 0.75 percent, with the margin based upon average excess availability for the immediately preceding fiscal quarter for loans based on the base rate.

Borrowings under ~~our~~the Revolving Credit Facility are subject to availability under the Borrowing Base (as that term is defined in the ~~Revolving~~revolving ~~Credit~~credit ~~Agreement~~agreement). The ~~Borrowers~~Company ~~are~~would be required to repay ~~revolving~~the ~~loans~~Revolving ~~thereunder~~Credit Facility to the extent that such revolving ~~loans~~borrowings exceed the ~~Borrowing~~borrowing ~~Base~~base then in effect. ~~Our~~The Revolving Credit Facility may be prepaid in whole or in part from time to time without penalty or premium, but including all breakage costs incurred by any lender thereunder.

As of ~~September~~March 30, ~~2023~~2024, wethe Company had zero outstanding borrowings and excess availability, including cash in qualified accounts, of $~~816~~827.38 million under our Revolving Credit Facility. As of December 3130, ~~2022~~2023, we had zero outstanding borrowings and excess availability, including cash in qualified accounts, of $~~645~~868.42 million under our Revolving Credit Facility. Available borrowing capacity under our Revolving Credit Facility was $346.5 million ason ~~of September~~March 30, ~~2023~~2024 and ~~December~~$346.5 ~~31,~~million ~~2022. Our average effective interest rate under the Revolving Credit Facility was zero percent for the fiscal quarters ended September~~December 30, 2023 ~~and October 1, 2022 since no borrowings were outstanding during those periods~~.

~~Our~~Debt Revolving Credit Facility contains certain financial and other covenants, and our right to borrow under the Revolving Credit Facility is conditioned upon, among other things, our compliance with these covenants. We were in compliance with all covenants under our Revolving Credit Facility as of September 30, 2023.Covenants

The Revolving Credit Facility and the 2029 Notes contain various covenants and restrictions, including customary financial covenants. The Company’s right to make draws on the Revolving Credit Facility may be conditioned upon, among other things, compliance with these covenants. The Company was in compliance with all covenants as of March 30, 2024 and December 30, 2023. These covenants also limit the Company’s ability to, among other things: incur additional debt; grant liens on assets; make investments; repurchase stock; pay dividends and make distributions; sell or acquire assets, including certain real estate assets, outside the ordinary course of business; engage in transactions with affiliates; and make fundamental business changes.

Finance Lease Obligations

~~Our~~The Company’s finance lease liabilities consist of leases related to equipment and vehicles, and real estate, with the majority of those finance leases related to real estate. For more information on our finance lease obligations, refer to Note 98, ~~Leases~~Lease Commitments.

~~7. Net Periodic Pension Cost (Benefit)~~ 10

~~The~~Table ~~following table shows the components~~ of ~~our net periodic pension cost (benefit):~~Contents

	Three Months Ended				Nine Months Ended
Pension-related items	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
	(In thousands)				(In thousands)
Service cost (1)	$	—	$	—	$	—	$	—
Interest cost on projected benefit obligation	1,105		606		3,314		1,818
Expected return on plan assets	(812)		(1,177)		(2,437)		(3,531)
Amortization of unrecognized gain	301		209		905		627
Net periodic pension cost (benefit)	$	594	$	(362)	$	1,782	$	(1,086)

6. Net Periodic Pension Cost

As previously disclosed, effective December 5, 2023, the Company settled its noncontributory defined benefit pension plan (1the “DB Plan”) ~~Service~~ ~~cost~~by ispurchasing ~~not~~an irrevocable nonparticipating annuity contract with an insurance company (the “buy-out contract”). The buyout contract met the requirements for a ~~part~~settlement, ofas ~~our~~that ~~net~~term ~~periodic~~is ~~pension~~defined ~~benefit~~in ASC No. 715, Compensation-Retirement Benefits, and the DB Plan and Company, as ~~our~~sponsor, ~~pension~~were ~~plan~~relieved isof ~~frozen~~primary responsibility for ~~all~~the ~~participants~~benefits obligations. Prior to settlement, during the three months ended April 1, 2023 the Company incurred the following net periodic pension cost:

The net periodic pension cost (benefit) is included in other expense, net in our condensed consolidated statement of operations and comprehensive income.


	Three Months Ended
	April 1, 2023
	(In thousands)
Service cost (1)	$	—
Interest cost on projected benefit obligation	1,104
Expected return on plan assets	(812)
Amortization of unrecognized gain	302
Net periodic pension cost	$	594

~~During the three and nine months ended September 30, 2023, we continued our previously announced plan to terminate the BlueLinx Corporation Hourly Retirement Plan~~ (~~the “plan”~~1) Service ~~and~~cost ~~transfer~~was ~~the~~not ~~management~~a ~~and~~part ~~delivery~~ of ~~continuing~~net ~~benefits~~periodic ~~associated with the plan to a highly rated and qualified insurance company with~~ pension ~~termination~~benefit ~~experience.~~since ~~The~~the ~~process for terminating a~~ pension plan ~~involves~~was ~~several~~frozen ~~regulatory~~for ~~steps~~all ~~and approvals, and typically takes 12 to 18 months to complete~~participants. ~~We estimate the plan termination will be completed during fiscal 2023 or early fiscal 2024.~~

8.The ~~Stock~~net ~~Compensation~~periodic pension cost is included in other expense, net in the Company’s unaudited condensed consolidated statement of operations and comprehensive income.

~~During the three and nine months ended September 30, 2023, we incurred stock compensation expense of $3~~7.0 million and $9.5 million, respectively. For the three and nine months ended October 1, 2022, we incurred stock compensation expense of $2.1 million and $6.0 million, respectively. The increase in our stock compensation expense for the nineShare-~~month~~Based ~~period ended September 30, 2023 is primarily attributable to the acceleration of unrecognized compensation cost in conjunction with our leadership transition.~~ Compensation

During the three months ended March 30, 2024 and April 1, 2023, the Company incurred stock compensation expense of $2.4 million and $4.6 million, respectively. Stock compensation expense for the three months ended April 1, 2023 included the acceleration of unrecognized compensation cost in conjunction with announced leadership transitions that occurred in 2023.

As of April 1, 2023, $1.3 million was accrued for tax withholding obligations of the Company’s employees upon vesting of restricted stock unit awards. This was presented as a non-cash transaction in the Company’s unaudited condensed consolidated statement of cash flows.

8. Lease Commitments

The Company has operating and finance leases for certain of its distribution facilities, office space, land, mobile fleet, and equipment. Many of these leases are non-cancelable and typically have a defined initial lease term, and some provide options to renew at the Company’s election for specified periods of time. The majority of these leases have remaining lease terms of one to 15 years, some of which include one or more options to extend the leases for typically five years. The Company’s leases generally provide for fixed annual rentals. Certain leases include provisions for escalating rent based on, among other things, contractually defined increases and/or changes in the Consumer Price Index (“CPI”). The known changes to lease payments are included in the lease liability at lease commencement. Unknown changes related to CPI are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. In addition, a subset of vehicle lease cost is considered variable. Some leases require the Company to pay taxes, insurance, and maintenance expenses associated with the leased assets. The lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company determines if an arrangement is a lease at inception and assesses lease classification as either operating or finance at lease inception or modification. Operating lease right-of use (“ROU”) assets and liabilities are presented separately on the Company’s consolidated balance sheets. Finance lease ROU assets are included in property and equipment and the finance lease obligations are presented separately in the Company’s consolidated balance sheets. When a lease does not provide an implicit interest rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. The Company has also made the accounting policy election to not separate lease components from non-lease components related to our mobile fleet asset class.

9.Table ~~Leases~~of Contents

WeThe ~~have~~Company’s ~~operating and~~ finance ~~leases~~lease ~~for~~liabilities ~~certain~~consist of ~~our~~leases ~~distribution~~related ~~facilities,~~to ~~office~~equipment ~~space,~~and ~~land~~vehicles, ~~mobile fleet,~~ and ~~equipment~~real estate. ~~Many~~A majority of ~~our~~the ~~leases~~Company’s ~~are~~finance ~~non-cancelable~~leases ~~and~~relate ~~typically~~to ~~have~~real aestate. ~~defined~~During ~~initial~~fiscal ~~lease~~2017 ~~term,~~ and ~~some~~fiscal ~~provide~~2018, ~~options~~the toCompany ~~renew~~entered atinto ~~our~~real ~~election~~estate ~~for~~financing ~~specified~~transactions ~~periods~~on ofcertain ~~time. The majority~~ of ~~our~~its ~~leases~~warehouse ~~have~~facilities. ~~remaining~~These ~~lease~~transactions ~~terms~~were ofcompleted ~~one~~pursuant to 15sale-leaseback ~~years~~arrangements, ~~some~~and ofupon ~~which~~their ~~include~~completion, ~~one~~the orCompany ~~more~~entered ~~options~~into tolong-term ~~extend~~leases on the ~~leases~~properties ~~for~~having ~~five~~renewal ~~years~~options. ~~Our~~The ~~leases~~Company ~~generally~~accounted ~~provide~~ for ~~fixed~~these ~~annual~~transactions ~~rentals.~~in ~~Certain~~accordance ofwith ~~our~~the ~~leases~~ASC ~~include~~840, ~~provisions~~Leases, ~~for~~which ~~escalating~~was ~~rent~~the ~~based~~lease ~~on,~~accounting ~~among~~standard ~~other~~in ~~things,~~effect ~~contractually~~for ~~defined~~the ~~increases~~Company ~~and/or~~at ~~changes in~~ the ~~Consumer~~inception ~~Price~~of ~~Index~~these ~~(“CPI”)~~arrangements. The ~~known~~Company ~~changes~~recorded tothese ~~lease~~transactions ~~payments~~as ~~are~~finance ~~included~~lease inliabilities ~~the~~on ~~lease~~its ~~liability~~consolidated atbalance ~~lease commencement~~sheet. ~~Unknown~~Gains ~~changes~~on ~~related~~these tosale-leaseback ~~CPI~~transactions ~~are~~were ~~treated~~deferred asand ~~variable~~are ~~lease~~being ~~payments and~~ recognized ininto the ~~period~~Company’s inearnings. ~~which~~As ~~the~~of ~~obligation~~March 30, ~~for~~2024 ~~those~~and ~~payments~~December 30, ~~was~~2023, ~~incurred.~~the Inremaining ~~addition,~~unrecognized adeferred ~~subset~~gains ofrelated ~~our~~to ~~vehicle~~these ~~lease~~transactions ~~cost~~were is$69.6 ~~considered~~million ~~variable~~and $70.5 ~~Some~~million, ofrespectively, ~~our~~and ~~leases~~these ~~require~~deferred usgains toare ~~pay~~being ~~taxes,~~recognized ~~insurance,~~in ~~and~~earning ~~maintenance~~on ~~expenses~~a ~~associated~~straight-line ~~with~~basis. During the ~~leased~~first ~~assets.~~quarters ~~Our~~of ~~lease~~fiscal ~~agreements~~2024 doand ~~not~~2023, ~~contain~~the ~~any~~Company ~~material~~recognized ~~residual~~$1.0 million ~~value~~of ~~guarantees~~these ordeferred ~~material~~gains ~~restrictive~~in ~~covenants~~each quarter.

WeThe ~~determine~~following iftable anpresents ~~arrangement~~the ~~is a lease at inception and assess lease classification as either operating or finance at lease inception or modification. Operating lease right-of use (“ROU”)~~ assets and liabilities ~~are~~related ~~presented~~to ~~separately on~~ the ~~condensed~~Company’s ~~consolidated~~leases ~~balance~~as ~~sheets.~~of ~~Finance~~March 30, ~~lease~~2024 ~~ROU assets are included in property~~ and ~~equipment and the finance lease obligations are presented separately in the condensed consolidated balance sheets. When a lease does not provide an implicit interest rate~~December 30, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Our accounting policy is to not separate lease components from non-lease components related to our mobile fleet asset class. 2023:

Finance Lease Liabilities


Lease assets and liabilities		March 30, 2024		December 30, 2023
		(In thousands)
Assets	Classification
Operating lease right-of-use assets	Operating lease right-of-use assets	$	34,869	$	37,227
Finance lease right-of-use assets (1)	Property and equipment, net	141,570		138,357
Total lease right-of-use assets		$	176,439	$	175,584

Liabilities
Current portion:
Operating lease liabilities	Operating lease liabilities - current	$	5,824	$	6,284
Finance lease liabilities	Finance lease liabilities - current	12,157		11,178
Non-current portion:
Operating lease liabilities	Operating lease liabilities - noncurrent	30,248		32,519
Finance lease liabilities	Finance lease liabilities - noncurrent	279,910		274,248
Total lease liabilities		$	328,139	$	324,229

~~Our~~(1) ~~finance~~Finance lease ~~liabilities consist~~ right-of-use ~~leases~~assets ~~related~~are topresented ~~equipment~~net ~~and~~of ~~vehicles,~~accumulated ~~and~~amortization ~~real~~of ~~estate~~$102. As4 million ~~noted~~and in$102.9 million ~~the~~as ~~table~~of ~~below~~March 30, a2024 ~~majority~~and ~~of our finance leases~~December 30, ~~formally known as capital leases~~2023, ~~relate to real estate~~respectively.

The following table presents our assets and liabilities related to our leases as of September 30, 2023 and December 31, 2022:

Lease assets and liabilities		September 30, 2023		December 31, 2022
		(In thousands)
Assets	Classification
Operating lease right-of-use assets	Operating lease right-of-use assets	$	42,145	$	45,717
Finance lease right-of-use assets (1)	Property and equipment, net	134,166		132,748
Total lease right-of-use assets		$	176,311	$	178,465
Liabilities
Current portion
Operating lease liabilities	Operating lease liabilities - short term	$	6,845	$	7,432
Finance lease liabilities	Finance lease liabilities - short term	9,813		7,089
Non-current portion
Operating lease liabilities	Operating lease liabilities - long term	37,007		40,011
Finance lease liabilities	Finance lease liabilities - long term	267,530		265,986
Total lease liabilities		$	321,195	$	320,518

(1) Finance lease right-of-use assets are presented net of accumulated amortization of $98.5 million and $90.1 million as of September 30, 2023 and December 31, 2022, respectively.

Table of Contents

The components of lease expense were as follows:

Three Months Ended

~~Nine Months Ended~~

Components of lease expense

~~September~~March 30, ~~2023~~2024

~~October~~April 1, ~~2022~~2023

~~September 30, 2023~~

~~October 1, 2022~~

(In thousands)

~~(In thousands)~~

Operating lease cost:

Operating lease cost

2,~~755~~446

2,~~529~~918

~~8,789~~

~~7,625~~

Sublease income

(~~1,062~~861)

(~~693~~578)

~~(2,475)~~

~~(2,021)~~

Total operating lease costs

1,~~693~~585

12,~~836~~340

~~6,314~~

~~5,604~~

Finance lease cost:

Amortization of right-of-use assets

54,~~408~~736

52,~~098~~089

~~12,190~~

~~13,698~~

Interest on lease liabilities

6,~~077~~291

6,~~104~~044

~~18,158~~

~~18,384~~

Total finance lease costs

11,~~485~~027

118,~~202~~133

~~30,348~~

~~32,082~~

Supplemental cash flow information related to leases was as follows:

Three Months Ended

~~Nine Months Ended~~

Cash flow information

~~September~~March 30, ~~2023~~2024

~~October~~April 1, ~~2022~~2023

~~September 30, 2023~~

~~October 1, 2022~~

(In thousands)

~~(In thousands)~~

Cash paid for amounts included in the measurement of lease liabilities

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

2,~~367~~509

23,~~562~~458

~~8,958~~

~~7,713~~

Operating cash flows from finance leases

6,~~077~~291

6,~~104~~044

~~18,158~~

~~18,384~~

Financing cash flows from finance leases

23,~~393~~072

2,~~496~~133

~~6,659~~

~~7,229~~

Non-cash supplemental cash flow information related to leases was as follows:

Three Months Ended

~~Nine Months Ended~~

Non-cash information

~~September~~March 30, ~~2023~~2024

~~October~~April 1, ~~2022~~2023

~~September 30, 2023~~

~~October 1, 2022~~

(In thousands)

~~(In thousands)~~

Right-of-use assets obtained in exchange for lease obligations

Right-of-use assets obtained in exchange for lease obligations:

Operating leases

—

~~3,604~~—

—

~~4,731~~

Finance leases

78,~~877~~177

~~3,279~~—

~~11,277~~

~~5,995~~

Table of Contents

Supplemental balance sheet information related to leases was as follows:

Balance sheet information	~~September~~March 30, ~~2023~~2024			December 3130, ~~2022~~2023
	(In thousands)
	($ in thousands)
Finance leases
Property and equipment	$	~~232~~243,~~692~~920		$	~~222~~241,~~839~~276
Accumulated depreciation	(98102,~~526~~350)			(90102,~~091~~919)
Property and equipment, net	$	~~134~~141,~~166~~570		$	~~132~~138,~~748~~357
Weighted Average Remaining Lease Term (in years)
Operating leases	98.0997			98.2188
Finance leases	1318.1435			1319.9794
Weighted Average Discount Rate
Operating leases	8.7079		%	8.5474		%
Finance leases	8.8885		%	8.8784		%

The major categories of ~~our~~the Company’s finance lease liabilities as of ~~September~~March 30, ~~2023~~2024 and December 3130, ~~2022~~2023 ~~were~~are as follows:

Category	~~September~~March 30, ~~2023~~2024		December 3130, ~~2022~~2023
	(In thousands)
Equipment and vehicles	$	3448,~~008~~445	$	2942,~~300~~252
Real estate	243,~~335~~622		243,~~775~~174
Total finance leases	$	~~277~~292,~~343~~067	$	~~273~~285,~~075~~426

~~Under the short-term lease exception provided within ASC 842, we do not record a lease liability or right-of-use asset for any leases that have a lease term of 12 months or less at commencement.~~ Below is a summary of undiscounted finance and operating lease liabilities that have initial terms in excess of one year as of ~~September~~March 30, ~~2023~~2024. The table also includes a reconciliation of the future undiscounted cash flows to the present value of the finance and operating lease liabilities included in the unaudited condensed consolidated balance ~~sheets~~sheet, including options to extend lease terms that are reasonably certain of being exercised.

Fiscal year	Operating leases		Finance leases
	(In thousands)
2023	$	2,755	$	17,101
2024	$	7,257	$	28,661
2024	10,626		26,566
2025	8,768		33,374
2025	9,347		32,000
2026	5,344		36,810
2026	5,956		35,717
2027	4,044		31,223
2027	4,657		30,298
2028	3,914		31,316
Thereafter	3224,~~208~~976		~~530~~500,~~078~~233
Total lease payments	$	6554,~~549~~303	$	~~671~~661,~~760~~617
Less: imputed interest	(2118,~~697~~231)		(~~394~~369,~~417~~550)
Total	$	4336,~~852~~072	$	~~277~~292,~~343~~067

~~10.~~Table ~~Commitments~~of ~~and Contingencies~~ Contents

~~Environmental~~9. Commitments and ~~Legal Matters~~Contingencies

From time to time, we are involved in various proceedings incidental to our businesses, and we are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. Although the ultimate outcome of these proceedings cannot be determined with certainty, based on presently available information management believes that adequate reserves have been established for probable losses with respect thereto and receivables have been recorded for expected receipts from settlements. Management further believes that, while the ultimate outcome of one or more of these matters could be material to our operating results in any given quarter, it will not have a materially adverse effect on our consolidated financial condition, our results of operations, or our cash flows.

Regulatory Matters

Government and regulatory agencies may have the ability to conduct routine audits and periodic examinations of, and administrative proceedings regarding, the Company’s business operations. ~~The~~As ~~United~~previously ~~States~~disclosed, U.S. Customs ~~and Border Protection has~~ gathered initial information from the Company under routine audit procedures, and the ~~initial~~ information ~~gathered~~indicated ~~suggests~~ that the Company potentially ~~may have~~ underpaid ~~and/or~~duties ~~overpaid~~in ~~duties~~prior periods arising from certain classification discrepancies for products imported into the United States as separately entered shipments. ~~The~~In working with the U.S. Customs, the Company ishas ~~currently~~exercised ~~evaluating~~reasonable care to address this matter~~. At~~ ~~this~~in ~~time~~an ~~the~~equitable ~~Company~~and isexpeditious ~~not~~manner inthrough the filing of a ~~position~~prior todisclosure ~~estimate~~submission ~~amounts~~with U.S. Customs and now estimates that it ~~may~~will be required to pay approximately $10.4 million, excluding any interest. The Company ~~intends~~accrued tothis ~~exercise~~estimated ~~reasonable~~amount ~~care~~in tothe ~~address~~first quarter of 2024 and it is reflected in Other current liabilities and in Costs of products sold on the Company’s unaudited condensed consolidated balance sheet and unaudited condensed consolidated statement of operations as of and for the three months ended March 30, 2024. See Note 2, Inventories, for disclosure concerning another matter inrelated anto ~~equitable~~import ~~manner~~duties.

Environmental Matters

From time to time, the Company is involved in various proceedings incidental to its business and the Company is subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which it operates. Although the ultimate outcome of these proceedings cannot be determined with certainty, based on presently available information, the Company believes that adequate liabilities have been accrued for probable losses with respect thereto and receivables recorded for expected receipts from settlements. The Company further believes that, while the ultimate outcome of these matters could be material to the Company’s financial position, results of operations and cash flows in any given reporting period, they will not have a materially adverse effect on the Company’s long-term financial condition, results of operations, or cash flows.

Collective Bargaining Agreements

As of ~~September~~March 30, ~~2023~~2024, ~~we employed~~ approximately ~~2,000 associates and less than one percent of our associates are employed on a part-time basis. Approximately~~ 20% ~~percent~~ of ~~our~~the ~~associates~~Company’s ~~are~~employees were represented by various local labor unions with terms and conditions of employment governed by ~~collective~~Collective ~~bargaining~~Bargaining ~~agreements~~Agreements (“CBAs”). ~~Two~~Three CBAs covering approximately ~~five~~3.5% ~~percent~~ of ~~our~~the ~~associates~~Company’s employees are up for renewal in the remainder of fiscal ~~2023~~2024, of which weone ~~expect~~has already been renegotiated, one is currently under negotiations, and one is expected to ~~renegotiate~~be renegotiated before their renewal dates.

1110. Accumulated Other Comprehensive Loss

~~Comprehensive~~As ~~income~~of ~~includes~~March 30, ~~both~~2024 ~~net income~~ and ~~other~~December 30, ~~comprehensive~~2023, ~~income.~~the ~~Other~~Company ~~comprehensive~~had ~~income~~no ~~results~~accumulated ~~from~~other ~~items~~comprehensive ~~deferred from recognition in net~~ income onor ~~our~~loss. As ~~condensed consolidated statements~~ of ~~operations~~April 1, ~~and~~2023, ~~comprehensive~~the ~~income.~~components ~~Accumulated~~of accumulated other comprehensive loss iswere ~~separately presented on our condensed consolidated balance sheets~~ as ~~part of stockholders’ equity.~~follows:

The changes in balances for each component of accumulated other comprehensive loss for the nine months ended September 30, 2023, were as follows:

	Definedbenefit pensionplan, net of tax		Other,net of tax		Total Accumulated Other Comprehensive Loss
	(In thousands)
December 31, 2022, beginning balance	$	(32,675)	$	1,263	$	(31,412)
Other comprehensive income, net of tax	689		(22)		667
September 30, 2023, ending balance, net of tax	$	(31,986)	$	1,241	$	(30,745)

11. Income Taxes

~~12.~~Effective Income ~~Taxes~~Tax Rate

~~Effective~~The ~~Tax~~Company’s ~~Rate~~effective tax rate for the three months ended March 30, 2024 and April 1, 2023 was 24.1 percent and 26.5 percent, respectively. For the full fiscal year ending December 28, 2024, the Company estimates that its annual effective income tax rate will be approximately 26%.

~~Our~~The Company’s effective tax rates for the three months ended ~~September~~March 30, ~~2023~~2024 and ~~October~~April 1, ~~2022~~2023 were ~~27.2~~impacted ~~percent~~by the permanent addback of certain nondeductible expenses, including meals and ~~26.2~~entertainment ~~percent~~and executive compensation, ~~respectively~~slightly offset by a benefit from the vesting of restricted stock units, which occurred during each period. ~~Our~~Additionally, the effective income tax ~~rates~~rate for the ~~nine~~three months ended ~~September~~March 30, ~~2023~~2024 ~~and~~was ~~October 1,~~impacted ~~2022~~by ~~were~~a ~~25.9~~partial ~~percent~~release ~~and~~of ~~25.4~~the ~~percent,~~valuation ~~respectively~~allowance for deferred income tax assets due to a state income tax adjustment.

Our effective tax rates for the three and nine months ended September 30, 2023 and October 1, 2022 were impacted by state taxes as well as the permanent addback of certain nondeductible expenses, including executive compensation, offset by a benefit from the vesting of restricted stock units, which occurred during each period. For additional information about our income taxes, see Note 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

~~13.~~Table ~~Earnings~~of ~~Per Share~~Contents

~~We calculate basic earnings per share by dividing net income by the weighted average number of common shares outstanding~~12. WeEarnings ~~calculate~~Per ~~diluted~~Share ~~earnings~~and ~~per~~Stockholders' share using the treasury stock method, by dividing net income by the weighted average number of common shares outstanding plus the dilutive effect of outstanding share-based awards, including restricted stock units.Equity

~~The~~Earnings ~~reconciliation~~Per ~~of basic net income and diluted earnings per common share for the three and nine month periods ended September 30, 2023 and October 1, 2022 were as follows:~~ Share

	Three Months Ended				Nine Months Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
	(In thousands, except per share data)				(In thousands, except per share data)
Net income	$	24,382	$	59,509	$	66,660	$	264,190
Weighted-average shares outstanding - basic	8,936		9,230		9,010		9,425
Dilutive effect of share-based awards	34		98		18		72
Weighted-average shares outstanding - diluted	8,970		9,328		9,028		9,497
Basic earnings per share	$	2.72	$	6.44	$	7.39	$	28.03
Diluted earnings per share	$	2.71	$	6.38	$	7.38	$	27.82

The Company calculates basic earnings per share by dividing net income for the period by the weighted average number of common shares outstanding for the period. For rounding purposes when calculating earnings per share, the Company’s policy is to round down to the whole cent.

~~Approximately~~Diluted ~~96,000~~earnings ~~and~~per ~~77,000~~share ~~weighted-average~~are ~~shares~~calculated ~~underlying~~using ~~share-based~~the ~~awards~~treasury ~~were~~stock ~~excluded~~method ~~from~~whereby net income for the ~~computation~~period ofis ~~diluted~~divided ~~earnings~~by ~~per~~the ~~share~~weighted average number of common shares outstanding for the ~~fiscal~~period ~~quarterly~~plus ~~periods~~the ~~ended~~dilutive ~~September 30~~effect, ~~2023~~if ~~and October 1~~any, ~~2022~~of shares of stock associated with unvested share-based grants. However, ~~respectively~~for performance-based share-based grants, ~~because~~the ~~their~~dilutive ~~inclusion~~effect ~~would~~is included only for grants where the performance goals have been ~~anti-dilutive~~actually achieved.

~~Approximately~~The ~~91,000~~reconciliation ~~and~~of ~~58,000~~basic ~~weighted-average~~net ~~shares~~income ~~underlying~~and ~~share-based awards were excluded from the computation of~~ diluted net earnings per common share for the ~~nine~~three-month ~~fiscal~~ periods ended ~~September~~March 30, ~~2023~~2024 and ~~October~~April 1, ~~2022,~~2023 ~~respectively,~~were ~~because~~as ~~their~~follows: ~~inclusion would have been anti-dilutive.~~

14. Subsequent Event


	Three Months Ended
	March 30, 2024		April 1, 2023
	(In thousands, except per share data)

Net income	$	17,492	$	17,812

Weighted average shares outstanding - Basic	8,653		9,059
Dilutive effect of share-based awards	88		98
Weighted average shares outstanding - Diluted	8,741		9,157

Basic earnings per share	$	2.02	$	1.96
Diluted earnings per share	$	2.00	$	1.94

OnApproximately ~~October 31~~114,000 ~~2023~~and 78,000 ~~the~~weighted-average ~~Company’s Board of Directors authorized a new~~ share-based ~~repurchase~~awards ~~program~~were ~~for~~excluded ~~$100 million,~~from ~~which follows~~ the ~~Company’s~~computation ~~previous~~of ~~$100 million~~earnings per share ~~repurchase~~assuming ~~program~~dilution ~~under which all remaining repurchase authority was utilized~~ during ~~early fiscal October 2023. Under~~ the ~~new~~three ~~share~~months ~~repurchase~~ended ~~program~~March 30, ~~the~~2024 ~~Company may repurchase its common stock from time to time, without prior notice, subject to prevailing market conditions~~ and ~~other considerations. Repurchases may be made through a variety of methods~~April 1, ~~which may include open market purchases~~2023, ~~privately negotiated transactions~~respectively, ~~accelerated~~as ~~share~~the ~~repurchase~~awards ~~programs,~~would ~~tender~~have ~~offers~~been oranti-dilutive ~~pursuant~~for ~~to a trading plan that may be adopted in accordance with~~ the ~~Securities~~periods ~~and Exchange Commission Rule 10b5-1~~presented.

Share Repurchases

2023 Authorization

On October 31, 2023, the Company’s board of directors authorized a new share repurchase program for $100 million. Under the new share repurchase program, the Company may repurchase its common stock from time to time, without prior notice, subject to prevailing market conditions and other considerations. Repurchases may be made through a variety of methods, which may include open market purchases, privately negotiated transactions, accelerated share repurchase programs, tender offers or pursuant to a trading plan that may be adopted in accordance with the Securities and Exchange Commission Rule 10b5-1.

During the three months ended March 30, 2024, the Company did not repurchase any of its common shares. As of March 30, 2024, there remained $91.4 million repurchase capacity under this authorization.

2021/2022 Authorization

On August 23, 2021, the Company’s board of directors approved a stock repurchase program that authorized the Company to repurchase up to $25.0 million of its common stock. On May 3, 2022, the Company’s board of directors increased the share repurchase authorization to $100 million. During the three months ended April 1, 2023, the Company did not repurchase any shares of its common stock under the 2021/2022 authorization. Between April 2023 and October 2023, the Company exhausted the remaining available capacity under the 2021/2022 authorization.

Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

~~About~~Cautionary ~~Our~~Statement ~~Business~~Concerning Forward-Looking Statements

~~BlueLinx~~This isQuarterly aReport ~~leading~~on ~~wholesale~~Form ~~distributor~~10-Q of(“Quarterly ~~residential~~Report” ~~and~~or ~~commercial~~“Form ~~building~~10-Q”) ~~products~~contains inforward-looking statements. Forward-looking statements include, without limitation, any statements that predict, forecast, indicate or imply future results, performance, liquidity levels or achievements, and may contain the ~~United~~words ~~States.~~“believe,” We“anticipate,” ~~are~~“could,” a“expect,” “~~two-step~~estimate,” ~~distributor~~“intend,” “may,” “project,” “plan,” “should,” “will,” “will be,” “will likely continue,” “will likely result” “would,” or words or phrases of similar meaning. ~~Two~~Forward-~~step~~looking ~~distributors~~statements ~~purchase~~are ~~products~~based ~~from~~on ~~manufacturers~~estimates and ~~distribute~~assumptions ~~those~~made ~~products~~by our management that, although believed by us to ~~dealers~~be reasonable, are inherently uncertain. Forward-looking statements involve risks and ~~other~~uncertainties ~~suppliers~~that inmay ~~local~~cause ~~markets~~our business, ~~who~~strategy, ~~then~~or ~~sell~~actual ~~those~~results ~~products~~ to ~~end~~differ ~~users~~materially from the forward-looking statements. WeThe ~~carry~~forward-looking astatements ~~broad~~in ~~portfolio~~this report include statements about anticipated effects of ~~both~~adopting ~~branded~~certain accounting standards; estimated future annual amortization expense; potential changes to estimates made in connection with revenue recognition; the expected outcome of legal proceedings; industry conditions; seasonality; liquidity and ~~private-label~~capital ~~stock~~resources; ~~keeping~~our ~~units~~confidence ~~(“SKUs”)~~in ~~across~~the ~~two~~Company’s ~~principal~~long-term ~~product~~growth ~~categories:~~strategy; ~~specialty~~our ~~products~~ability to capitalize on supplier-led price increases and ~~structural~~our ~~products.~~value-added ~~Specialty~~services; ~~products~~our ~~include~~areas ~~items~~of ~~such~~focus asand ~~engineered~~management ~~wood,~~initiatives; ~~siding,~~the ~~millwork,~~demand ~~outdoor~~outlook ~~living,~~for ~~specialty~~construction ~~lumber~~materials and ~~panels~~expectations regarding new home construction, repair and ~~industrial~~remodel ~~products.~~activity ~~Structural~~and ~~products~~continued ~~include~~investment ~~items~~in ~~such~~existing asand ~~lumber,~~new ~~plywood,~~homes; ~~oriented~~our ~~strand~~positioning ~~board,~~for ~~rebar,~~long-term value creation; our efforts and ~~remesh.~~ability Weto ~~also~~generate ~~provide~~profitable agrowth; ~~wide~~our ~~range~~ability to increase net sales in specialty product categories; our ability to generate profits and cash from sales of ~~value~~specialty products; our multi-~~added~~year ~~services~~capital allocation plans; our ability to manage volatility in wood-based commodities; our improvement in execution and ~~solutions~~productivity; ~~aimed~~our atefforts ~~relieving~~and ~~distribution~~ability to maintain a disciplined capital structure and ~~logistics~~capital ~~challenges~~allocation ~~for~~strategy; our ~~customers~~ability ~~and~~to ~~suppliers,~~maintain ~~while~~a ~~enhancing~~strong ~~their~~balance ~~marketing~~sheet; our ability to focus on operating improvement initiatives and ~~inventory~~commercial ~~management~~excellence; ~~capabilities~~and whether or not the Company will continue any share repurchases.

WeThese ~~sell~~risks ~~products through three main distribution channels, consisting of warehouse sales, reload sales,~~ and ~~direct~~uncertainties ~~sales.~~also ~~Warehouse~~include ~~sales,~~those ~~which~~discussed ~~generate~~under the ~~majority~~heading of“Risk ~~our~~Factors” ~~sales,~~in ~~are~~Item ~~delivered~~1A ~~from our warehouses to our customers. Reload sales are similar to warehouse sales but are shipped from warehouses, most~~ of which are operated by third parties, where we store owned products to enhance operating efficiencies. This channel is employed primarily to service strategic customers that would be less economical to service from our ~~warehouses,~~Annual ~~and~~Report toon ~~distribute~~Form ~~large~~10-K ~~volumes~~for ~~of imported products from port facilities. Direct sales are shipped from~~ the ~~manufacturer~~year toended ~~the customer without our taking physical possession of the inventory and~~December 30, ~~as a result~~2023, ~~typically~~those ~~generate~~discussed ~~lower~~elsewhere ~~margins~~in ~~than~~this ~~our~~Form ~~warehouse~~10-Q, and ~~reload~~in ~~distribution~~future ~~channels.~~reports ~~This~~that ~~distribution~~we ~~channel,~~file ~~however,~~with ~~requires~~ the ~~lowest amount of committed capital and fixed costs~~SEC.

We ~~have~~operate in a ~~strong~~changing ~~market~~environment ~~position~~in ~~and~~which anew ~~broad~~risks ~~geographic~~can ~~coverage~~emerge ~~footprint~~from ~~servicing~~time ~~all~~to 50time. ~~states,~~It ~~and~~is wenot ~~maintain~~possible ~~locations~~for ~~that~~management ~~serve~~to 75predict ~~percent~~all of ~~the~~these ~~highest~~risks, ~~growth~~nor ~~metropolitan~~can ~~statistical~~it ~~areas~~assess ~~based~~the onextent ~~forecasted~~to ~~housing~~which ~~starts~~any ~~and~~factor, ~~repair~~or ~~and~~a ~~remodel~~combination ~~spend. With the strength~~ of afactors, ~~locally~~may ~~focused~~cause ~~sales~~our ~~force~~business, westrategy, ~~distribute~~or aactual ~~comprehensive~~results ~~range~~to ofdiffer ~~products~~materially from ~~over~~those ~~750~~contained ~~suppliers.~~in ~~Our~~forward-looking ~~suppliers~~statements. ~~include~~Given ~~some~~these ofrisks ~~the~~and ~~leading manufacturers in the industry~~uncertainties, ~~such~~we ascaution ~~Allura,~~you ~~Arauco,~~not ~~Fiberon,~~to ~~Georgia-Pacific,~~place ~~Huber~~undue ~~Engineered~~reliance ~~Woods,~~on ~~Louisiana~~forward-~~Pacific,~~looking ~~Oldcastle APG, Ply Gem, Roseburg, Royal and Weyerhaeuser~~statements. We ~~supply~~expressly ~~products~~disclaim toany aobligation ~~broad~~to ~~base~~update ofor ~~customers~~revise ~~including~~any ~~national~~forward-looking ~~home~~statement ~~centers,~~as ~~pro~~a ~~dealers,~~result ~~cooperatives,~~of ~~specialty~~new ~~distributors~~information, ~~regional~~future ~~and~~events ~~local~~or ~~dealers~~otherwise, ~~lumber~~except ~~yards~~as ~~and~~required ~~industrial~~by ~~manufacturers~~law. ~~Many of our customers serve residential and commercial builders, contractors and remodelers in their respective geographic areas and local markets.~~

As a value-added partner in a complex and demanding building products supply chain, we play a critical role in enabling our customers to offer a broad range of products and brands, as most of our customers do not have the capability to purchase and warehouse products directly from manufacturers for such a large set of SKUs. The ~~depth~~following ofdiscussion ~~our~~should ~~geographic~~be ~~footprint~~read ~~supports meaningful customer proximity across all the markets~~ in ~~which~~conjunction wewith ~~operate, enabling faster and more efficient service. Similarly, we provide value to~~ our ~~supplier~~consolidated ~~partners~~financial bystatements ~~enabling access to the large~~ and ~~fragmented~~related ~~network~~notes ~~of lumber yards~~ and ~~dealers~~other ~~these~~financial ~~suppliers~~information ~~could~~included ~~not adequately serve directly. Our position~~ in this ~~distribution~~Form ~~model~~10-Q ~~for~~and ~~building~~in ~~products provides easy access to the marketplace for~~ our ~~suppliers~~Annual ~~and~~Report ~~a value proposition of rapid delivery~~ on anForm as10-~~needed~~K ~~basis~~for tofiscal ~~our~~year ~~customers from our network of warehouse facilities~~2023.

~~Industry~~In ~~Overview~~addition to historical information, the following discussion and other parts of this Form 10-Q contain forward-looking information that involves risks and uncertainties. Our actual results could differ materially from those anticipated by this forward-looking information due to the factors discussed under Item 1A “Risk Factors” in our Form 10-K for fiscal 2023 and under “Cautionary Statement Concerning Forward-Looking Statements” in Item 2 of this Form 10-Q.

Our ~~products are available across large and attractive end markets~~Culture, ~~including~~Values ~~residential repair~~ and ~~remodel~~Management and residential new construction, which together account for approximately 85 percent of the end market mix for our addressable building material market served via two-step distribution based on our estimates. We also estimate the remaining 15 percent is accounted for by commercial construction.Focus

Broad-based inflation, the rise in mortgage rates, home price appreciation and other recent developments have led to a more challenging recent macro-economic environment. These developments, in turn, impacted the U.S. housing market, including the residential repair and remodel and residential new construction end markets, and have contributed to a recent slowdown in the U.S. housing industry. However, we continue to believe that several factors, including the current high levels of home equity, the fundamental undersupply of housing in the U.S., repair and remodel activity, and demographic shifts, among others, will support demand for our products.

Residential Repair and Remodel

We estimate that demand from the residential repair and remodel market (“R&R”) accounts for approximately 45 percent of our annual sales. Historically, R&R demand has tended to be less cyclical when compared to the residential new construction market, particularly for exterior products that are exposed to the elements and where maintenance is less likely to be deferred for long periods of time. We believe R&R demand is driven by a myriad of factors including, but not limited to: home prices and affordability; raw materials prices; the pace of new household formation; savings rates; employment conditions; and emerging trends, such as the increased popularity of home-based remote working environments. With mortgage rates having risen to multi-year highs, we believe many homeowners who secured a lower interest mortgage will be inclined to stay longer in existing homes, which could benefit R&R demand over the near-to-medium term.

According to the Joint Center For Housing Studies’ Leading Indicator of Housing Activity (“LIRA”) Index, R&R demand is expected to return to more normalized levels, following several consecutive years of elevated R&R activity fueled by pandemic-induced changes in housing and lifestyle decisions. However, according to LIRA Index, the total market size of the U.S. R&R market remains significant, with total U.S. homeowner improvements and repairs projected to fall from $489 billion to $452 billion over the coming four quarters.

Further, as the median age of U.S. housing stock increases over time, we anticipate U.S. R&R spending will also increase. According to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, the median age of a home in the U.S. increased from 23 years in 1985 to 39 years in 2019. Moreover, approximately 80 percent of the current housing stock was built prior to 1999. We believe the increasing average age of the nation’s approximate 144 million existing homes will continue to drive demand for repair and remodel projects.

Residential New Construction

We estimate that demand from the residential new construction market, including single-family and multi-family units, accounts for approximately 40 percent of our annual sales.

We believe demand for residential new construction is driven by a myriad of factors including, but not limited to: mortgage rates, which recently reached multi-year highs; lending standards; home affordability; employment conditions; savings rates; the rate of population growth and new household formation; builder activity levels; the level of existing home inventory on the market; and consumer sentiment.

According to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development, during the third quarter of 2023, average single-family and multi-family combined housing starts in the United States, seasonally adjusted, were approximately six percent lower compared to the third quarter of 2022. As of the end of the third quarter of 2023, the months supply of inventory of new homes was almost at seven months, above the 20-year average of six months. For most of the last decade, housing production has lagged population growth and household formation.

We believe our scale, national footprint, strategic supplier relationships, key national customer relationships, and breadth of market leading products and brands position us to serve the residential new construction end market and navigate the challenges in the macro-economic environment.

Seasonality

We are exposed to fluctuations in quarterly sales volumes and expenses due to seasonal factors common in the building products distribution industry, such as weather conditions and other seasonal factors. The first and fourth quarters have historically been our lower volume quarters due to the impact of unfavorable weather on the residential repair and remodel and residential new home construction markets, among other factors. Our second and third quarters have historically been higher volume quarters compared to the first and fourth quarters, reflecting an increase in repair and remodel and residential new home construction activities due to more favorable seasonal conditions.

Our historical patterns of seasonality were impacted by the COVID-19 pandemic which caused supply and demand imbalances impacting our sales volumes. While there is continued uncertainty surrounding certain macro-economic environment developments that impact our sales volumes, we have returned to more normalized supply chain conditions and manufacturing output.

Commodity Markets

Our operating results are sensitive to fluctuations in commodity markets, specifically commodity markets for wood-based commodities that we classify as structural products. When prices fluctuate in the commodity markets which impact us, we may immediately adjust the end price of our products to compensate for the changes in market prices, which is common for businesses with inventories impacted by commodity price fluctuations. When we change our prices in response to market fluctuations, we will often see immediate impacts in our operating results. When market prices increase, this impact can be beneficial. Conversely, when market prices decrease, the impact can be negative because we are adjusting the selling prices for inventory often purchased at higher market prices. See Note 3, Inventories, to the condensed consolidated financial statements and Results of Operations below for discussion of the impact of fluctuations in commodity markets on results for the periods presented.

Supply Constraints

Our operating results are impacted by the availability of the products we sell in the markets in which we do business. When our inventory supply is constrained, our operating results may be impacted by lower sales volumes. While supply constraints may negatively impact our sales volumes, they may also have a positive impact on our net sales and overall profitability. This is because supply constraints can cause prices to increase. Under these circumstances, we may sell less product by volume, but at a higher price which could have a positive impact on our levels of sales and profitability. Conversely, rapid changes in supply levels, such as the sudden increase in availability of a product where the supply was previously constrained, may have a negative impact on our operating results especially in situations where the demand does not also increase proportionally with supply increases.

Our Culture and Management Focus

We remain committed to driving a culture of profitable growth within new and existing product lines and geographies, while positioning the Company for long-term value creation. The following initiatives represent key areas of our management team’s focus:

1.Foster a performance-driven culture committed to profitable growth. This includes enhancing the customer experience; accelerating organic growth within specific product and solutions offerings where the Company is uniquely advantaged; and deploying capital to drive sustained margin expansion, grow cash flow and maintain continued profitable growth.

2.Migrate sales mix toward higher-margin specialty product categories. The Company is pursuing a revenue mix increasingly weighted toward higher-margin, specialty product categories such as engineered wood, siding, millwork, outdoor living, specialty lumber and panels, and industrial products. Additionally, the Company is expanding its value-added service offerings designed to simplify complex customer sourcing requirements and provide enhanced service capabilities afforded by the Company’s national platform.17

~~3.Maintain~~Table ~~a disciplined capital structure and pursue high-return investments that increase the value~~ of the Company. The Company is maintaining a disciplined capital structure while at the same time investing in its business to modernize its distribution facilities, as well as its tractor and trailer fleet, and to improve operational performance. The Company also continues to evaluate potential acquisition targets that complement its existing capabilities, grow its specialty products business, increase customer exposure, expand its geographic reach, or a combination thereof. We invested $18.9 million in our business during the first nine months of fiscal 2023 to improve operational performance and productivity.Contents

~~Factors~~2.Migrate ~~That~~sales ~~Affect~~mix ~~Operating~~toward ~~Results~~higher-margin specialty product categories. The Company is pursuing a revenue mix increasingly weighted toward higher-margin, specialty product categories such as engineered wood, siding, moulding and millwork, outdoor living, specialty lumber and panels, and industrial products. Additionally, the Company is expanding its value-added service offerings designed to simplify complex customer sourcing requirements and provide enhanced service capabilities afforded by the Company’s national platform.

~~Our~~3.Maintain ~~results of operations and financial performance are influenced by~~ a ~~variety~~disciplined ofcapital ~~factors,~~structure ~~including the following: pricing~~ and ~~product~~pursue ~~cost~~high-return ~~variability;~~investments ~~volumes of product sold; competition; changes in the supply and/or demand for products~~ that weincrease ~~distribute;~~ the ~~cyclical~~value ~~nature~~ of the ~~industry~~Company. inThe ~~which~~Company weis ~~operate;~~maintaining ~~housing~~a ~~market~~disciplined ~~conditions;~~capital ~~consolidation~~structure ~~among~~while ~~competitors,~~at ~~suppliers,~~the ~~and~~same ~~customers;~~time ~~disintermediation~~investing ~~risk;~~in ~~loss~~its ofbusiness ~~products~~to ormodernize ~~key~~its ~~suppliers~~distribution ~~and~~facilities, ~~manufacturers;~~as ~~our~~well ~~dependence~~as onits ~~international~~tractor ~~suppliers~~ and ~~manufacturers~~trailer ~~for~~fleet, ~~certain products; potential acquisitions~~ and ~~the~~to ~~integration~~improve ~~and~~operational ~~completion~~performance. ofThe ~~such~~Company ~~acquisitions;~~also ~~business~~continues ~~disruptions;~~to ~~effective~~evaluate ~~inventory~~potential ~~management~~acquisition ~~relative~~targets tothat ~~our~~complement ~~sales~~its ~~volume~~existing orcapabilities, ~~the~~grow ~~prices~~its ofspecialty ~~the~~ products ~~we produce; information technology security risks and~~ business, ~~interruption~~increase ~~risks;~~customer ~~the ability to attract~~exposure, ~~train,~~expand ~~and~~its ~~retain~~geographic ~~highly~~reach ~~qualified~~through ~~associates~~potential ~~and~~greenfield ~~other~~expansions ~~key~~in ~~personnel~~new ~~while~~markets, ~~controlling~~or ~~related~~a ~~labor~~combination ~~costs;~~thereof. ~~exposure~~We toinvested ~~product~~$5.4 ~~liability~~million ~~and~~cash ~~other~~in ~~claims and legal proceedings related to~~ our business and ~~the~~entered ~~products~~into we$8.2 ~~distribute;~~million ~~natural~~of ~~disasters,~~finance ~~catastrophes,~~leases ~~fire,~~during ~~wars~~the orfirst ~~other~~quarter ~~unexpected events; successful implementation~~ of ~~our~~fiscal ~~strategy;~~2024 ~~wage~~to ~~increases~~improve oroperational ~~work~~performance ~~stoppages~~and ~~by our union employees; costs~~ productivity.

Our culture is guided by an unwavering commitment to apply our values to every decision we make and every action we take:

•Customer Centric - We put our customers first, so we are customer centric in all that we do.

•Integrity - We act with integrity, because doing the right thing is critical to our success.

•Respect - We treat everyone with dignity and respect.

•Grit - We show grit in the face of changing landscapes.

•Collaboration - We collaborate with each other and our customers to build great teams and construct innovative solutions.

Looking ahead, we plan to continue pursuing a three-pronged growth strategy focusing on specialty products sales growth, opportunistic mergers and acquisitions (“M&A”), and potential greenfield expansion in new geographic markets. Within specialty products, we will continue our focus on the five key areas of engineered wood, siding, moulding and millwork, outdoor living, and industrial products, which we believe are all favorable for two-step distributors and have attractive long-term prospects.

Factors That Affect Our Operating Results and Trends

Our results of operations and financial performance are influenced by a variety of factors, including the following: housing market conditions; pricing and product cost variability; volumes of product sold; competition; the cyclical nature of the industry in which we operate; consolidation among competitors, suppliers, and customers; disintermediation risk; loss of products or key suppliers and manufacturers; our dependence on international suppliers and manufacturers for certain products; effective inventory management relative to our sales volume or the prices of the products we produce; business disruptions; potential acquisitions and the integration and completion of such acquisitions; information technology security risks and business interruption risks; the ability to attract, train, and retain highly qualified associates and other key personnel while controlling related labor costs; exposure to product liability and other claims and legal proceedings related to our business and the products we distribute; natural disasters, catastrophes, fire, wars or other unexpected events; the impacts of climate change; successful implementation of our strategy; wage increases or work stoppages by our union employees; costs imposed by federal, state, local, and other regulations; compliance costs associated with federal, state, and local environmental protection laws; the effects of epidemics, global pandemics or other widespread public health crises and governmental rules and regulations; fluctuations in our operating results; our level of indebtedness and our ability to incur additional debt to fund future needs; the covenants of the instruments governing our indebtedness limiting the discretion of our management in operating the business; the potential to incur more debt; the fact that we have consummated certain sale leaseback transactions with resulting long-term non-cancelable leases, many of which are or will be finance leases; the fact that we lease many of our distribution centers, and we would still be obligated under these leases even if we close a leased distribution center; inability to raise funds necessary to finance a required repurchase of our senior secured notes; a lowering or withdrawal of debt ratings; changes in our product mix; increases in fuel and other energy prices or availability of third-part freight providers; changes in insurance-related deductible/retention reserves based on actual loss development experience; the possibility that the value of our deferred tax assets could become impaired; changes in our expected annual effective tax rate could be volatile; the costs and liabilities related to our participation in multi-employer pension plans could increase; the risk that our cash flows and capital resources may be insufficient to service our existing or future indebtedness; interest rate risk, which could cause our debt service obligations to increase; and changes in, or

Table of Contents

interpretation of, accounting principles. These factors, and the related trends and uncertainties, have historically produced cyclicality in our results of operations, and we expect this cyclicality to continue in future periods.

For more information on the risk factors impacting our business, refer to Part I, Item 1A, Risk Factors, in our Annual Report on Form 10-K for the fiscal year 2023.

~~imposed~~Table by federal, state, local, and other regulations; compliance costs associated with federal, state, and local environmental protection laws; costs associated with federal law and regulations regarding importation of products; global pandemics, such as COVID-19, and other widespread public health crises and their potential effects on our business; fluctuations in our operating results; our level of indebtedness and our ability to incur additional debt to fund future needs; the covenants of the instruments governing our indebtedness limiting the discretion of our management in operating the business; the potential to incur more debt; the fact that we have consummated certain sale leaseback transactions with resulting long-term non-cancelable leases, many of which are or will be finance leases; the fact that we lease many of our distribution centers, and we would still be obligated under these leases even if we close a leased distribution center; inability to raise funds necessary to finance a required repurchase of our senior secured notes; a lowering or withdrawal of debt ratings; changes in our product mix; increases in petroleum prices; changes in insurance-related deductible/retention reserves based on actual loss experience; the possibility that the value of our deferred tax assets could become impaired; changes in our expected annual effective tax rate could be volatile; changes in actuarial assumptions for our pension plan; the costs and liabilities related to our participation in multi-employer pension plans could increase; the risk that our cash flows and capital resources may be insufficient to service our existing or future indebtedness; variable interest rate risk under certain indebtedness; changes in, or interpretation of, accounting principles; significant stock price fluctuation; the possibility that we could be the subject of securities class action litigation due to stock price volatility; unfavorable securities or industry analyst publications; volatility or disruptions in the capital markets or other factors affecting the amount and timing of share repurchases and whether or not the Company will continue, and the timing of, any open market repurchases; activities of activist shareholders; and indebtedness terms that limit our ability to pay dividends on common stock.Contents

Results of Operations

The following table sets forth our results of operations for the third quarter of fiscal 2023 and fiscal 2022:


	Three Months Ended March 30, 2024		% of Net Sales	Three Months Ended April 1, 2023		% of Net Sales
	($ amounts in thousands)
Net sales	$	726,244		$	797,904

Gross profit	127,681		17.6%	133,539		16.7%
Selling, general, and administrative	91,250		12.6%	91,174		11.4%
Depreciation and amortization	9,433		1.3%	7,718		1.0%
Amortization of deferred gains on real estate	(984)		(0.1)%	(984)		(0.1)%

Other operating expenses	314		0.0%	3,116		0.4%
Operating income	27,668		3.8%	32,515		4.1%
Interest expense, net	4,624		0.6%	7,687		1.0%
Other expense, net	—		—%	594		0.1%
Income before provision for income taxes	23,044		3.2%	24,234		3.0%
Provision for income taxes	5,552		0.8%	6,422		0.8%
Net income	$	17,492	2.4%	$	17,812	2.2%

	Third Quarter of Fiscal 2023		% ofNetSales	Third Quarter of Fiscal 2022		% ofNetSales
	(In thousands)			(In thousands)
Net sales	$	809,981	100.0%	$	1,060,761	100.0%
Gross profit	139,246		17.2%	189,376		17.9%
Selling, general, and administrative	91,354		11.3%	91,678		8.6%
Depreciation and amortization	8,089		1.0%	6,688		0.6%
Amortization of deferred gains on real estate	(984)		(0.1)%	(983)		(0.1)%
Other operating expenses	1,131		0.1%	1,267		0.1%
Operating income	39,656		4.9%	90,726		8.6%
Interest expense, net	5,577		0.7%	10,444		1.0%
Other expense, net	594		0.1%	(361)		(0.0)%
Income before provision for income taxes	33,485		4.1%	80,643		7.6%
Provision for income taxes	9,103		1.1%	21,134		2.0%
Net income	$	24,382	3.0%	$	59,509	5.6%

The following table sets forth net sales by product category:

The following table sets forth our results of operations for the first nine month periods of fiscal 2023 and fiscal 2022:


	Three Months Ended
	March 30, 2024				April 1, 2023
	($ amounts in thousands)
Specialty products	$	503,834	69	%	$	567,838	71	%
Structural products	222,410		31	%	230,066		29	%
Total net sales	$	726,244	100	%	$	797,904	100	%

	First Nine Months of Fiscal 2023		% ofNetSales	First Nine Months of Fiscal 2022		% ofNetSales
	(In thousands)			(In thousands)
Net sales	$	2,423,852	100.0%	$	3,602,445	100.0%
Gross profit	408,588		16.9%	681,835		18.9%
Selling, general, and administrative	271,278		11.2%	274,305		7.6%
Depreciation and amortization	23,758		1.0%	19,952		0.6%
Amortization of deferred gains on real estate	(2,952)		(0.1)%	(2,951)		(0.1)%
Gains from sales of property	—		0.0%	(144)		(0.0)%
Other operating expenses	5,240		0.2%	2,731		0.1%
Operating income	111,264		4.6%	387,942		10.8%
Interest expense, net	19,575		0.8%	32,992		0.9%
Other expense, net	1,782		0.1%	916		0.0%
Income before provision for income taxes	89,907		3.7%	354,034		9.8%
Provision for income taxes	23,247		1.0%	89,844		2.5%
Net income	$	66,660	2.8%	$	264,190	7.3%

The following table sets forth gross profit and gross margin percentages by product category:


	Three Months Ended
	March 30, 2024			April 1, 2023
Gross profit by product category:	($ amounts in thousands)
Specialty products	$	104,049		$	106,627
Structural products	23,632			26,912
Total gross profit	$	127,681		$	133,539
Gross margin % by product category:
Specialty products	20.7		%	18.8		%
Structural products	10.6		%	11.7		%

Consolidated gross margin %	17.6		%	16.7		%

First Quarter of Fiscal 2024 Compared to First Quarter of Fiscal 2023

For the first quarter of fiscal 2024, we generated consolidated net sales of $726.2 million, a decrease of $71.7 million when compared to the first quarter of fiscal 2023 and the consolidated gross margin percentage increased from 16.7 percent to 17.6 percent year over year. The decrease in consolidated net sales in the current period was due to 11.3 percent and 3.3 percent declines in specialty products and structural products net sales, respectively. For both product categories, volumes were adversely impacted by winter weather in January 2024 in several parts of the U.S., which resulted in the closure of about half of our branch locations for one to five days. Volumes improved in February and March 2024. Compared to first quarter 2023, industry-wide commodity pricing for framing lumber decreased 2.4% and increased 23.2% for structural panels.

Table of Contents

The increase in consolidated gross margin percentage in the current period was due to a net benefit of $6.5 million for import duty items in the current period for our specialty products. The import duty items were related to changes in retroactive rates for anti-dumping duties resulting in a credit to Cost of products sold of $16.9 million, partially offset by classification adjustments for certain goods imported by the Company that resulted in an increase in Cost of products sold of $10.4 million. The net benefit from import duties added 0.9% to the consolidated gross margin percentage for the current period.

Net sales of specialty products, which includes products such as engineered wood, siding, millwork and moulding, outdoor living, specialty lumber and panels, and industrial products, decreased $64.0 million, or 11.3 percent, to $503.8 million in the first quarter of fiscal 2024. This decline in net sales for specialty products was due to deflationary impacts across several specialty categories. Specialty products gross profit decreased $2.6 million, or 2.4 percent, to $104.0 million, with a year-over-year increase in gross margin percentage to 20.7 percent for the first quarter of fiscal 2024 from 18.8 percent in the first quarter of fiscal 2023. The net benefit for import duty items of $6.5 million described above added 1.3% to the specialty products gross margin for the current quarter.

Net sales of structural products, which includes products such as lumber, plywood, oriented strand board, rebar, and remesh, decreased $7.7 million, or 3.3 percent, to $222.4 million in the first quarter of fiscal 2024. Structural products gross margin percentage for the first quarter of fiscal 2024 was 10.6 percent, down from 11.7 percent in the prior-year period. The decreases in structural products net sales and gross profit percentage were due primarily to lower framing lumber volumes when compared to the elevated levels in the prior year period.

Our selling, general, and administrative expenses (“SG&A”) were $91.3 million in the first quarter of 2024, comparable with the $91.2 million for the prior year period. Depreciation and amortization expense increased 22.2 percent, compared to the first quarter of fiscal 2023. The increase in depreciation and amortization is due to a higher base of amortizable and depreciable assets in the first quarter of fiscal 2024 when compared the prior-year period, resulting from our continued focus on capital investment. Other operating expenses decreased $2.8 million compared to the first quarter of fiscal 2023; the prior year period included $3.7 million for restructuring costs related to our leadership transition and costs related to settlement of our legacy defined benefit pension plan.

Interest expense, net, decreased by 39.8 percent, or $3.1 million, compared to the first quarter of fiscal 2023. The decrease was primarily due to the generation of higher interest income on our cash and cash equivalents due to higher balances and interest rates in the current quarter. Included in interest income for the three months ended March 30, 2024 is $2.0 million received for antidumping import duty refunds. Interest expense, net for the three months ended March 30, 2024 also includes $1.6 million of estimated accrued interest expense related to estimated import duties owed by the Company (see Note 9, Commitments and Contingencies).

Our effective tax rates were 24.1 percent and 26.5 percent for the first quarter of fiscal 2024 and 2023, respectively. Our effective tax rate for both periods was impacted by the permanent addback of certain nondeductible expenses, including meals and entertainment and executive compensation, slightly offset by a benefit from the vesting of restricted stock units, which occurred during each period. For the current quarter, the partial release of a valuation allowance for deferred income taxes lowered our effective income tax rate by 1.4 percent. We anticipate that our annual effective income tax rate for fiscal 2024 will be approximately 26 percent.

Our net income for the first quarter of fiscal 2024 was $17.5 million, or $2.00 per diluted share, versus $17.8 million, or $1.94 per diluted share, in the prior-year period. The change in net income was due to the matters previously discussed. Despite lower net income in the current quarter, basic and diluted earnings per share were higher than the prior year period due to a lower average number of common shares outstanding during the current quarter; this resulted from share repurchases that occurred in fiscal 2023 after the first quarter.

~~The~~Table ~~following~~of ~~table sets forth net sales by product category for the three and nine month periods ending September 30, 2023 and October 1, 2022:~~ Contents

	Three Months Ended						Nine Months Ended
	September 30, 2023			October 1, 2022			September 30, 2023			October 1, 2022
Net sales by product category	(In thousands)						(In thousands)
Specialty products	$	558,851		$	724,323		$	1,697,679		$	2,280,090
Structural products	251,130			336,438			726,173			1,322,355
Total net sales	$	809,981		$	1,060,761		$	2,423,852		$	3,602,445
Percentage of total net sales by product category
Specialty products	69.0		%	68.3		%	70.0		%	63.3		%
Structural products	31.0		%	31.7		%	30.0		%	36.7		%
Total net sales	100.0		%	100.0		%	100.0		%	100.0		%

The following table sets forth gross profit and gross margin percentages by product category for the three and nine month periods of fiscal 2023 and 2022:

	Three Months Ended						Nine Months Ended
	September 30, 2023			October 1, 2022			September 30, 2023			October 1, 2022
Gross profit by product category	(In thousands)						(In thousands)
Specialty products	$	110,898		$	151,428		$	326,366		$	515,781
Structural products	28,348			37,948			82,222			166,054
Total gross profit	$	139,246		$	189,376		$	408,588		$	681,835
Gross margin % by product category
Specialty products	19.8		%	20.9		%	19.2		%	22.6		%
Structural products	11.3		%	11.3		%	11.3		%	12.6		%
Total gross margin %	17.2		%	17.9		%	16.9		%	18.9		%

Third Quarter of Fiscal 2023 Compared to Third Quarter of Fiscal 2022

For the third quarter of fiscal 2023, we generated net sales of $810.0 million, a decrease of $250.8 million when compared to the third quarter of fiscal 2022 and gross margin percentage decreased from 17.9 percent to 17.2 percent year over year. The decline in net sales compared to the prior year period was primarily due to price deflation and lower sales volume for both specialty and structural products, reflecting changing market conditions. The decline in gross margin percentage was attributable to our specialty products, as discussed below.

Net sales of specialty products, which includes products such as engineered wood, siding, millwork, outdoor living, specialty lumber and panels, and industrial products, decreased $165.5 million to $558.9 million in the third quarter of fiscal 2023. The decline was due to price deflation combined with lower sales volume across several product categories as we return to more normalized market conditions. Specialty products gross profit decreased $40.5 million to $110.9 million, with a year over year decline of 110 basis points in specialty gross margin to 19.8 percent for the third quarter of fiscal 2023, compared to 20.9 percent in the third quarter of fiscal 2022. The decrease in specialty gross margin percentage over the prior-year period is also attributable to the year over year price and volume normalization.

Net sales of structural products, which includes products such as lumber, plywood, oriented strand board, rebar, and remesh, decreased $85.3 million to $251.1 million in the third quarter of fiscal 2023 primarily due to price deflation in the wood-based commodity markets represented by the year-over-year declines in the average composite price of framing lumber and structural panels, which were 26% and 5%, respectively. Our structural gross margin percentage for the third quarter of fiscal 2023 was 11.3 percent, the same as the 11.3 percent in the prior-year period. Our structural gross margin percentage for the third quarter of fiscal 2022 reflects a $5.7 million favorable impact for the partial release of an inventory reserve recorded in the second quarter of fiscal 2022, while a $0.6 million reserve provision for our structural lumber inventory was recorded in the third quarter of fiscal 2023 to reflect the lower of cost or net realizable value. However, the gross margin percentage for third quarter of fiscal 2023 remained consistent with the prior-year period due to our continued focus on pricing discipline and inventory management. For more details on our lower of cost or market reserves for inventories, please see Note 3, Inventories.

Our selling, general, and administrative expenses, which includes approximately $1.9 million of incremental operating expenses related to our Vandermeer acquisition, decreased $0.3 million compared to the third quarter of fiscal 2022 primarily due to lower delivery costs and variable compensation. Depreciation and amortization expense increased 20.9 percent, compared to the third quarter of fiscal 2022 due to a higher base of amortizable and depreciable assets throughout the third quarter of fiscal 2023 when compared to the prior-year period, resulting from our continued focus on capital investment and increased intangible assets related to our Vandermeer acquisition.

Interest expense, net, decreased by 46.6 percent, or $4.9 million, compared to the third quarter of fiscal 2022. The decrease is primarily due to the generation of higher interest income, given our year over year increase in cash that is generating interest at higher rates than last year.

Our effective tax rates were 27.2 percent and 26.2 percent for the third quarter of fiscal 2023 and 2022, respectively. Our effective tax rate for both periods was impacted by state taxes as well as the permanent addback of certain nondeductible expenses, including meals and entertainment and executive compensation, slightly offset by a benefit from the vesting of restricted stock units, which is typical for the third quarter of each year.

Our net income for the third quarter of fiscal 2023 was $24.4 million, or $2.71 per diluted share, versus $59.5 million, or $6.38 per diluted share, in the prior-year period. Decreases in our net income and earnings per diluted share were due primarily to a decrease in gross profit driven by price deflation and lower sales volume, particularly for our engineered wood products and lumber, along with declines in pricing. This was partially offset by lower operating expense, net interest expense and income tax expense during the period.

First Nine Months of Fiscal 2023 Compared to First Nine Months of Fiscal 2022

For the first nine months of fiscal 2023, we generated net sales of $2.4 billion, a decrease of $1.2 billion when compared to the first nine months of fiscal 2022 and gross margin percentage decreased from 18.9 percent to 16.9 percent year over year. The declines in net sales and overall gross margin percentage compared to the prior year period were primarily due to price deflation combined with lower sales volumes in our specialty and structural products, reflecting changing market conditions.

Net sales of specialty products, which includes products such as engineered wood, siding, millwork, outdoor living, specialty lumber and panels, and industrial products, decreased $582.4 million to $1.7 billion in the first nine months of fiscal 2023. The decline was due to pricing deflation combined with lower sales volume across several product categories as we return to more normalized market conditions. Specialty products gross profit decreased $189.4 million to $326.4 million, with a year over year decline of 340 basis points in specialty gross margin to 19.2 percent for the first nine months of fiscal 2023, compared to 22.6 percent in the first nine months of fiscal 2022. The decrease in specialty gross margin percentage over the prior-year period is also attributable to the year over year price and volume normalization.

Net sales of structural products, which includes products such as lumber, plywood, oriented strand board, rebar, and remesh, decreased $596.2 million to $726.2 million in the first nine months of fiscal 2023 primarily due to price deflation in the wood-based commodity markets represented by the decline in the average composite price of framing lumber and structural panels, which were 52% and 40%, respectively. Our structural gross margin percentage for the first nine months of fiscal 2023 was 11.3 percent, down from 12.6 percent in the prior-year period, primarily attributable to price deflation in the wood-based commodity markets represented by year-over-year declines in the average composite price of framing lumber and structural panels. The impacts of these factors on the gross margin percentage in the first nine months of fiscal 2023 were partially offset by our continued focus on pricing discipline and inventory management, as well as favorable changes in our net provisions for inventory reserves in the current period. The first nine months of fiscal 2023 were favorably impacted by a $2.0 million, net inventory reserve release, while inventory reserve provisions of $4.1 million, net were recorded in the first nine months of fiscal 2022. For more details on our lower of cost or market reserves for inventories, please see Note 3, Inventories.

Our selling, general, and administrative expenses, which includes approximately $5.6 million of incremental operating expenses related to our Vandermeer acquisition, decreased $3.0 million compared to the first nine months of fiscal 2022 primarily due to a decrease in delivery expenses and variable compensation. Depreciation and amortization expense increased 19.1 percent, compared to the first nine months of fiscal 2022 due to a higher base of amortizable and depreciable assets throughout the first nine months of fiscal 2023 when compared the prior-year period, resulting from our continued focus on capital investment and increased intangible assets related to our Vandermeer acquisition. Other operating expenses increased $2.5 million compared to the first nine months of fiscal 2022 primarily due to restructuring related costs, including severance expenses incurred in fiscal 2023 due to our leadership transition.

Interest expense, net, decreased by 40.7 percent, or $13.4 million, compared to the first nine months of fiscal 2022. The decrease is primarily due to the generation of higher interest income, given our year over year increase in cash that is generating interest at higher rates than last year.

Our effective tax rates were 25.9 percent and 25.4 percent for the first nine months of fiscal 2023 and 2022, respectively. Our effective tax rate for both periods was impacted by state taxes as well as the permanent addback of certain nondeductible expenses, including meals and entertainment and executive compensation, offset by a benefit from the vesting of restricted stock units.

Our net income for the first nine months of fiscal 2023 was $66.7 million, or $7.38 per diluted share, versus $264.2 million, or $27.82 per diluted share, in the prior-year period. Our net income for the first nine months of fiscal 2023 decreased due primarily to a decrease in gross profit driven by lower sales volume, particularly for our engineered wood products, lumber, and panels, along with declines in pricing. This was partially offset by net interest expense and income tax expense.

Liquidity and Capital Resources

We expect our primary sources of liquidity to be cash flows from sales and operating activities in the normal course of our operations, cash and cash equivalents on hand, and availability from our revolving credit facility, as needed. We expect that these sources will be sufficient to fund our ongoing cash requirements for at least the next 12 months and into the foreseeable future. As of March 30, 2024, we had $481.3 million of cash and cash equivalents plus $346.5 million of availability on our revolving credit facility.

Senior Secured Notes

In October 2021, we completed ~~the~~a private offering of $300 million of our 6six percent senior secured notes due 2029 (the “2029 Notes”). ~~The~~Interest ~~2029~~is ~~Notes~~payable ~~were issued to investors at 98~~semi-annually.~~625~~ ~~percent~~Our of2029 ~~their~~Notes ~~principal~~are ~~amount~~scheduled ~~and~~to ~~will~~ mature on November 15, 2029., ~~The~~and ~~majority~~no ofprincipal ~~net~~is ~~proceeds~~due ~~from~~until ~~the~~that ~~offering~~time ofas long as we remain in compliance with the ~~2029~~related ~~Notes~~covenants. ~~were~~As ~~used~~of toMarch 30, ~~repay~~2024, ~~borrowings~~we ~~under~~were ~~our~~in ~~Revolving~~compliance ~~Credit~~with ~~Facility~~these covenants.

As of September 30, 2023 and December 31, 2022, the fair value of our 2029 Notes was approximately $271.5 million and $283.6 million, respectively, which are designated as Level 2 in the fair value hierarchy. Our valuation technique is based primarily on observable market prices in less active markets.

Revolving Credit Facility

Our amended revolving credit facility, ~~entered~~matures ~~into~~on ~~with Wells Fargo Bank~~August 2, ~~National Association~~2026, asprovided ~~administrative~~we ~~agent~~remain ~~(the~~in ~~“Agent”),~~compliance ~~and~~with ~~certain~~the ~~other~~related ~~financial institutions party thereto, provides for a senior secured asset-based revolving loan and letter of credit facility of up to $350~~covenants.0 ~~million.~~As ~~Our obligations under the Revolving Credit Facility (as defined below) are secured by a security interest in substantially all~~ of ~~our and our subsidiaries’ assets (other than real property)~~March 30, ~~including inventories~~2024, ~~accounts receivable, and proceeds from those items. On June 27, 2023,~~ we ~~entered~~were ~~into~~in acompliance ~~third amendment to the credit facility to, among other things, replace the interest rate based on LIBOR applicable to borrowings under the Credit Agreement~~ with anthese ~~interest rate based on the SOFR and a customary spread adjustment (as amended, the “Revolving Credit Facility”)~~covenants.

~~Our~~Any ~~Revolving~~outstanding ~~Credit~~borrowings ~~Facility~~under ~~includes~~the ~~available~~revolving credit facility bear interest at a rate ~~options~~per ~~and~~annum ~~was~~equal ~~previously~~to (i) Adjusted Term Secured Overnight Financing Rate (“SOFR”) (calculated as SOFR plus 0.1%) plus a margin ranging from 1.25 percent to 1.75 percent, with the margin determined based upon average excess availability for the immediately preceding fiscal quarter for loans based on ~~LIBOR~~SOFR, ~~which~~or ~~was~~(ii) ~~discontinued~~the agent’s base rate (as anthat ~~available~~term ~~rate~~is ~~option~~defined ~~after~~in ~~June~~the ~~30,~~revolving ~~2023~~credit agreement) plus a margin ranging from 0.25 percent to 0.75 percent, with the margin based upon average excess availability for the immediately preceding fiscal quarter for loans based on the base rate.

Borrowings under ~~our~~the Revolving Credit Facility ~~bear~~are ~~interest~~subject ~~at a rate per annum equal~~ to ~~(i)~~availability ~~Adjusted~~under ~~Term~~the ~~SOFR~~Borrowing ~~(calculated~~Base (as ~~SOFR~~that ~~plus~~term ~~0.1%)~~is ~~plus~~defined ain ~~margin~~the ~~ranging~~revolving ~~from~~credit 1agreement).25 ~~percent~~The toCompany ~~1.75~~is ~~percent,~~required ~~with~~to ~~the~~repay ~~margin~~revolving ~~determined~~loans ~~based~~thereunder ~~upon~~to ~~average excess availability for~~ the ~~immediately~~extent ~~preceding~~that ~~fiscal~~such ~~quarter~~revolving ~~for~~ loans ~~based~~exceed ~~on SOFR, or (ii)~~ the ~~Agent’s~~Borrowing ~~base~~Base ~~rate~~then ~~plus~~in aeffect. ~~margin~~The ~~ranging~~Revolving ~~from~~Credit ~~0.25~~Facility ~~percent~~may tobe ~~0.75~~prepaid ~~percent,~~in ~~with~~whole ~~the~~or ~~margin~~in ~~based~~part ~~upon~~from ~~average~~time ~~excess~~to ~~availability~~time ~~for~~without ~~the~~penalty ~~immediately~~or ~~preceding~~premium ~~fiscal~~but ~~quarter~~including ~~for~~all ~~loans~~breakage ~~based~~costs onincurred ~~the~~by ~~base~~any ~~rate~~lender thereunder.

~~Borrowings~~Available borrowing capacity under our Revolving Credit Facility ~~are~~was ~~subject~~$346.5 tomillion ~~availability under the Borrowing Base (~~as ~~that~~of ~~term~~March 30, ~~is defined in the Revolving Credit Agreement)~~2024. The ~~Borrowers~~available ~~are~~borrowing ~~required~~capacity toreflects ~~repay~~undrawn ~~revolving~~letters ~~loans~~of ~~thereunder to the extent that such revolving loans exceed the Borrowing Base then in effect~~credit. ~~Our Revolving Credit Facility may be prepaid in whole or in part from time to time without penalty or premium, but including all breakage costs incurred by any lender thereunder.~~

As of September 30, 2023, we had zero outstanding borrowings and excess availability, including cash in qualified accounts, of $816.3 million under our Revolving Credit Facility. As of December 31, 2022, we had zero outstanding borrowings and excess availability, including cash in qualified accounts, of $645.4 million under our Revolving Credit Facility. Available borrowing

capacity under our Revolving Credit Facility was $346.5 million as of September 30, 2023 and December 31, 2022. Our average effective interest rate under the Revolving Credit Facility was zero percent for the fiscal quarters ended September 30, 2023 and October 1, 2022 since no borrowings were outstanding during the periods.

Our Revolving Credit Facility contains certain financial and other covenants, and our right to borrow under the Revolving Credit Facility is conditioned upon, among other things, our compliance with these covenants. We were in compliance with all covenants under our Revolving Credit Facility as of September 30, 2023.

Finance Lease Commitments

Our finance lease liabilities consist of leases related to equipment and vehicles, and to real estate, with the majority of those finance lease commitments relating to the real estate financing transactions that we completed in recent years. Our total finance lease commitments totaled $~~277~~292.31 million and $~~273~~285.14 million as of ~~September~~March 30, ~~2023~~2024 and December 3130, ~~2022~~2023, respectively. Of the $~~277~~292.31 million of finance lease commitments as of ~~September~~March 30, ~~2023~~2024, $243.36 million related to real estate and $3448.04 million related to equipment. Of the $~~273~~285.14 million of finance lease commitments as of December 3130, ~~2022~~2023, $243.82 million related to real estate and $2942.3 million related to equipment.

Interest Rates

Our Revolving Credit Facility includes available interest rate options and was previously based on LIBOR, which was discontinued as an available rate option after June 30, 2023. On June 27, 2023, we amended our existing Revolving Credit Facility, under which LIBOR was replaced with SOFR with respect to the applicable variable rate interest options thereunder.

Sources and Uses of Cash

Operating Activities

Net cash ~~provided~~used byin operating activities for the first ~~nine~~three months of fiscal ~~2023~~2024 was $~~230~~31.71 million, compared to net cash provided by operating activities of $~~246~~89.0 million in the first ~~nine~~three months of fiscal ~~2022~~2023. ~~The~~This decrease of $120.1 million in cash ~~provided~~generated byfrom operating activities ~~during~~in the ~~first~~current ~~nine~~year ~~months~~period ofcompared ~~fiscal~~to ~~2023~~the prior year period was primarily a result of aseasonal ~~decrease~~inventory purchases in ~~net income for~~ the current~~-year~~ ~~period compared to the prior-~~year period,. ~~partially~~The ~~offset~~net bysource ~~higher~~of cash generated ~~from changes~~ in ~~working~~the ~~capital~~prior ~~components,~~year ~~including~~period awas ~~decrease~~driven ~~in inventory and increase in accounts payable, offset~~ by ~~the~~significant ~~increase~~inventory inreduction ~~accounts receivable in the current-year period~~efforts.

Investing Activities

Net cash used in investing activities for the first ~~nine~~quarter ~~months~~ of fiscal ~~2023~~2024 was $185.73 million compared to net cash used in investing activities of $189.40 million in the first ~~nine~~quarter ~~months~~ of fiscal ~~2022~~2023. The ~~change~~decrease in net cash used in investing activities was primarily due to lower ~~cash~~purchases ~~proceeds~~of ~~from~~property ~~sales~~and ofequipment ~~assets~~in ~~during~~ the current year-period compared to the prior-year period. However, during the

Table of Contents

first quarter of fiscal 2024, we also invested in additional fleet upgrades by entering into $8.2 million of finance leases, which are non-cash activities at lease inception.

Financing Activities

Net cash used in financing activities totaled $414.10 million for the first ~~nine~~three months of fiscal ~~2023~~2024, compared to net cash used in financing activities of $832.47 million for the first ~~nine~~three months of fiscal ~~2022~~2023. ~~The~~This change ~~in net cash used in financing activities~~ was ~~primarily~~ due to ahigher ~~decrease~~payments inon ~~cash~~finance ~~used~~lease ~~for~~obligations ~~repurchases~~in ofthe ~~our~~current ~~common~~period. Other ~~stock~~than ~~under~~to ~~our~~satisfy ~~announced~~payroll ~~share~~and ~~repurchase~~withholding ~~program. During~~taxes ~~the~~for ~~first~~vesting ~~nine~~grants ~~months~~ of ~~fiscal~~restricted ~~2023~~stock units, we ~~repurchased~~did ~~$29.3~~not ~~million~~repurchase any shares of our common stock ~~compared~~during toeither ~~$66.4~~the ~~million~~first ~~during~~quarter of 2024 or the first ~~nine~~quarter ~~months~~ of ~~fiscal 2022~~2023.

~~Stock~~Share Repurchase Program

~~During the third quarter of fiscal 2023, we repurchased 216,507 shares of our common stock under our share repurchase program at an average price of $84.93 per share.~~ As of ~~September~~March 30, ~~2023~~2024, we ~~had~~have a remaining authorization amount of ~~approximately~~ $391.74 million under ~~the~~our ~~program,~~$100 ~~which~~million ~~was~~share ~~fully~~repurchase ~~utilized~~program inthat ~~early~~was ~~fiscal~~previously ~~October~~disclosed ~~2023.~~and Onauthorized ~~October 31,~~by ~~2023,~~our ~~the Company’s~~ Board of Directors ~~authorized~~on aOctober 31, ~~new share repurchase program for $100 million~~2023.

Under ~~the~~this ~~new~~ share repurchase program, wethe Company may repurchase ~~our~~its common stock ~~at any time or~~ from time to time, without prior notice, subject to prevailing market conditions and other considerations. ~~Our~~Repurchases ~~repurchases~~ may be made through a variety of methods, which may include open market purchases, privately negotiated transactions, accelerated share repurchase programs, tender offers or pursuant to a trading plan that may be adopted in accordance with the Securities and Exchange Commission Rule 10b5-1.

25Net Working Capital

~~Operating~~Net ~~Working~~working ~~Capital~~capital is an important measurement we use to determine the efficiencies of our operations and our ability to readily convert assets into cash. Net working capital is defined as the sum of accounts receivables and inventory, less accounts payable, each determined in accordance with GAAP and included in our consolidated balance sheets. This metric differs from traditional working capital in that it excludes certain current assets and current liabilities that are reported in our consolidated balance sheets. Management of net working capital helps us monitor our progress in meeting our goals to enhance working capital assets.

Operating working capital is an important measurement we use to determine the efficiencies of our operations and our ability to readily convert assets into cash. Operating working capital is defined as the sum of receivables and inventory, less accounts payable. Management of working capital helps us monitor our progress in meeting our goals to enhance working capital assets.



	March 30, 2024		December 30, 2023		April 1, 2023
	(In thousands)
Current assets:
Accounts receivables, less allowance for doubtful accounts	$	288,244	$	228,410	$	298,888
Inventories, net	370,942		343,638		409,324
	$	659,186	$	572,048	$	708,212

Current liabilities:
Accounts payable	$	171,715	$	157,931	$	177,046
	$	171,715	$	157,931	$	177,046

Net working capital	$	487,471	$	414,117	$	531,166

Selected financial information
	September 30, 2023		December 31, 2022		October 1, 2022
	(In thousands)
Current assets:
Receivables, less allowance for doubtful accounts	$	297,568	$	251,555	$	360,535
Inventories, net	364,162		484,313		535,979
	$	661,730	$	735,868	$	896,514
Current liabilities:
Accounts payable	$	202,256	$	151,626	$	208,197
	$	202,256	$	151,626	$	208,197
Operating working capital	$	459,474	$	584,242	$	688,317

Net working capital of $487.5 million as of March 30, 2024, compared to $414.1 million as of December 30, 2023, increased on a net basis by approximately $73.4 million. The increase in net working capital was primarily driven by the increases in accounts receivable and inventory due to higher sales and seasonality. This overall increase was partially offset by the increase in accounts payable due to seasonal inventory procurement activity.

~~Operating~~Net working capital of $~~459~~487.5 million as of ~~September~~March 30, ~~2023~~2024, compared to $~~584~~531.2 million as of ~~December~~April 311, ~~2022~~2023, decreased on a net basis by approximately $~~124~~43.8 million. ~~This~~The decrease in ~~operating~~net working capital iswas primarily driven by the decrease in inventory, which ~~reflects~~reflected our strategic inventory management efforts, and ~~the~~a ~~increase~~deflationary inpricing ~~accounts payable due to timing of cash disbursements~~environment. ~~This was partially offset by the increase in accounts receivable due to the impacts of sequential sales increases and timing of cash receipts.~~

Investments in Property and Equipment

Our investments in capital assets consist of cash paid for owned assets and the inception of financing lease arrangements for long-lived assets to support our distribution infrastructure. The gross ~~value~~values of these assets isare included in property and equipment, at cost on our condensed consolidated balance sheet. For the first nine months of fiscal 2023, we invested $18.9 million in cash investments in long-lived assets primarily related to investments in our distribution facilities and to a lesser extent, upgrading our fleet. We also added $11.3 million in new finance leases during the third fiscal quarter of 2023 for new forklifts and tractors to enhance our logistical network.

~~Critical Accounting Policies~~23

~~The~~Table ~~preparation~~ of our consolidated financial statements and related disclosures in conformity with GAAP requires our management to make judgments and estimates that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. There have been no material changes to our critical accounting policies from the information provided in Part 2, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.Contents

~~Forward~~equipment, at cost on our condensed consolidated balance sheet. For the first quarter of 2024, we invested $5.4 million in property and equipment, including $3.9 million for our distribution facilities and $1.5 million in fleet upgrades. Additionally, during the first quarter of 2024, we entered into finance leases of $8.2 million for fleet upgrades. For the first quarter of 2023, we invested $9.0 million cash in long-~~Looking~~lived ~~Statements~~assets primarily for our distribution facilities and to a lesser extent, upgrading our fleet.

~~This~~Critical ~~report~~Accounting ~~contains~~Policies forward-looking statements. Forward-looking statements include, without limitation, any statement that predicts, forecasts, indicates or implies future results, performance, liquidity levels or achievements, and may contain the words “believe,” “anticipate,” “could,” “expect,” “estimate,” “intend,” “may,” “project,” “plan,” “should,” “will,” “will be,” “will likely continue,” “will likely result,” “would” or words or phrases of similar meaning. Forward-looking statements involve risks and uncertainties that may cause our business, strategy, or actual results to differ materially from the forward-looking statements. The forward-looking statements in this report include statements about anticipated effects of adopting certain accounting standards; estimated future annual amortization expense; potential changes to estimates made in connection with revenue recognition; the expected outcome of legal proceedings; industry conditions; seasonality; and liquidity and capital resources.Estimates

~~Forward-looking~~The ~~statements~~preparation ~~are~~of ~~based~~our onconsolidated ~~estimates~~financial statements and ~~assumptions~~related ~~made~~disclosures byin conformity with GAAP requires our management ~~that,~~to ~~although~~make ~~believed~~judgments byand usestimates tothat beaffect ~~reasonable,~~the ~~are~~amounts ~~inherently~~reported ~~uncertain.~~in ~~Forward-looking~~our ~~statements~~condensed ~~involve~~consolidated ~~risks~~financial statements and ~~uncertainties~~accompanying ~~that~~notes. ~~may~~There ~~cause~~have ~~our~~been ~~business,~~no ~~strategy,~~material orchanges ~~actual~~to ~~results~~our tocritical ~~differ~~accounting ~~materially~~policies and estimates from the ~~forward-looking~~information ~~statements.~~provided ~~These~~in ~~risks~~Item ~~and~~7 ~~uncertainties~~of ~~include~~our ~~those~~Annual Report on Form 10-K for the fiscal year ended December 30, 2023.

2624

~~discussed~~Table ~~under the heading “Risk Factors” in Item 1A~~ of our Annual Report on Form 10-K for the year ended December 31, 2022, and those discussed elsewhere in this report and in future reports that we file with the SEC. We operate in a changing environment in which new risks can emerge from time to time. It is not possible for management to predict all of these risks, nor can it assess the extent to which any factor, or a combination of factors, may cause our business, strategy, or actual results to differ materially from those contained in forward-looking statements. Factors that may cause these differences include, among other things: Contents

•we may experience pricing and product cost variability;

•our earnings are highly dependent on volumes;

•our industry is highly fragmented and competitive and if we are unable to compete effectively, our net sales and operating results may be reduced;

•our industry is highly cyclical, and prolonged periods of weak demand or excess supply may reduce our net sales and/or margins, which may cause us to incur losses or reduce our net income;

•adverse housing market conditions may negatively impact our business, liquidity, and results of operations, and increase the credit risk from our customers;

•consolidation among competitors, suppliers, and customers could negatively impact our business;

•we are subject to disintermediation risk;

•loss of key products or key suppliers and manufacturers could affect our financial health;

•our dependence on international suppliers and manufacturers for certain products exposes us to risks that could affect our financial condition and expose us to certain additional risks;

•our strategy includes pursuing acquisitions, and we may be unsuccessful in making and integrating mergers, acquisitions and investments;

•constraints, volatility or disruptions in the capital markets or other factors affecting the amount and timing of share repurchases and whether or not the Company will continue, and the timing of, any open market repurchases;

•we may incur business disruptions resulting from a variety of possible causes;

•we may be unable to effectively manage our inventory relative to our sales volume or as the prices of the products we distribute fluctuate, which could affect our business, financial condition, and operating results;

•we are subject to information technology security risks and business interruption risks and may incur increasing costs in an effort to minimize and/or respond to those risks;

•our success depends on our ability to attract, train, and retain highly qualified associates and other key personnel while controlling related labor costs;

•we are exposed to product liability and other claims and legal proceedings related to our business and the products we distribute, which may exceed the coverage of our insurance;

•our business operations could suffer significant losses from climate changes, natural disasters, catastrophes, fire, or other unexpected events;

•our operating results depend on the successful implementation of our strategy and we may not be able to implement our strategic initiatives successfully, on a timely basis, or at all;

•a significant percentage of our employees are unionized, and wage increases or work stoppages by our unionized employees may reduce our results of operations;

•federal, state, local, and other regulations could impose substantial costs and restrictions on our operations that would reduce our net income;

•we are subject to federal, state, and local environmental protection laws and may have to incur significant costs to comply with these laws and regulations in the future;

•we are subject to federal law and regulations regarding the importation of products and may have to incur significant costs to comply with these laws and regulations in the future;

•the effect of global pandemics, such as COVID-19, and other widespread public health crises and governmental rules and regulations and our policies related to such may adversely affect our business and results from operations;

•our future operating results may fluctuate significantly, and our current operating results may not be a good indication of our future performance;

•fluctuations in our quarterly financial results could affect our stock price in the future;

•our level of indebtedness could limit our financial and operating activities and adversely affect our ability to incur additional debt to fund future needs;

•the instruments governing our indebtedness contain various covenants limiting the discretion of our management in operating our business, including requiring us to maintain a minimum level of excess liquidity;

•despite our current levels of debt, we may still incur more debt, which would increase the risks described in these risk factors relating to indebtedness;

•we have sold and leased back certain of our distribution centers under long-term non-cancelable leases, and we may enter into similar transactions in the future. All of these leases are (or will be) finance leases, and our debt and interest expense may increase as a result;

•many of our distribution centers are leased, and if we close a leased distribution center before expiration of the lease, we will still be obligated under the applicable lease, and we may be unable to renew the leases at the end of their terms;

•we may not have or be able to raise the funds necessary to finance a required repurchase of our senior secured notes;

•a lowering or withdrawal of the ratings assigned to our debt securities by rating agencies may increase our future borrowing costs and reduce our access to capital;

•a change in our product mix could adversely affect our results of operations;

•if the cost of fuel, third-party freight or other energy prices increase or availability of third-party freight providers is reduced, our results of operations could be adversely affected;

•we establish insurance-related deductible/retention reserves based on historical loss development factors, which could lead to adjustments in the future based on actual development experience;

•the value of our deferred tax assets could become impaired, which could materially and adversely affect our operating results;

•our expected annual effective tax rate could be volatile and materially change as a result of changes in mix of earnings and other factors;

•changes in actuarial assumptions for our pension plan could impact our financial results, and funding requirements are mandated by the Federal government;

•costs and liabilities related to our participation in multi-employer pension plans could increase;

•our cash flows and capital resources may be insufficient to make required payments on our indebtedness or future indebtedness;

•borrowings under our revolving credit facility bears interest at a variable rate, which subjects us to interest rate risk, which could cause our debt service obligations to increase significantly;

•changes in, or interpretation of, accounting principles could result in unfavorable accounting changes;

•our stock price may fluctuate significantly;

•we could be the subject of securities class action litigation due to stock price volatility, which could divert management’s attention and adversely affect our results of operations;

•if securities or industry analysts do not publish research or publish unfavorable research about our business, our stock price and trading volume could decline;

•the activities of activist stockholders could have a negative impact on our business and results of operations; and

•the terms of our revolving credit facility and senior secured notes place restrictions on our ability to pay dividends on our common stock, so any returns to stockholders may be limited to the value of their stock.

Given these risks and uncertainties, we caution you not to place undue reliance on forward-looking statements. We expressly disclaim any obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to certain market risks as part of our on-going business operations. Our exposure includes commodity price risk and interest rate risk. There have been no material changes to our exposure to market risks from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 30, 2023.

Commodity Price Risk

Many of the building products that we distribute, including oriented strand board (“OSB”), plywood, lumber, and rebar, are commodities whose price is determined by the market’s supply and demand for such products. Prices of commodity products can also change as a result of national and international economic conditions, labor and freight costs, competition, market speculation, government regulation, and trade policies, as well as from periodic delays in the delivery of products. Short-term increases in the cost of these materials, some of which are subject to significant fluctuations, are sometimes passed on to our customers, but our pricing quotation periods and pricing pressure from our competitors may limit our ability to pass on such price changes. We may also be limited in our ability to pass on increases in freight costs on our products. We may enter into derivative financial instruments to mitigate the potential impact of commodity price fluctuations on our results of operations or cash flows. As of September 30, 2023, we had no such derivative financial instruments in place.

Interest Rate Risk

We may experience changes in interest expense if changes in our debt occur. Changes in market interest rates could also affect our interest expense. We are exposed to interest rate risk arising from fluctuations in variable-rate SOFR or other applicable benchmark rates when we have loan amounts outstanding on our revolving credit facility. We do not believe that a one percent increase in interest rates, for example, would have a material effect on our results of operations or cash flows. As of September 30, 2023, we had no outstanding borrowings on our revolving credit facility. Our senior secured notes bear interest at a fixed rate, therefore, our interest expense related to these notes would not be affected by an increase in market interest rates. We may enter into derivative financial instruments to mitigate the potential impact of interest rate risk on our results of operations or cash flows. As of September 30, 2023, we had no such derivative financial instruments in place.

ITEM 4. CONTROLS AND PROCEDURES

Our management performed an evaluation, as of the end of the period covered by this report on Form 10-Q, under the supervision of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”)). Based on that evaluation, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management including our chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.

During the period covered by this report, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

2925

Table of Contents

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

~~During~~We ~~the~~are, ~~third~~and ~~quarter~~from oftime ~~fiscal~~to ~~2023,~~time ~~there~~may ~~were~~be, noa ~~material~~party ~~changes~~ to ~~our~~routine legal proceedings asincidental ~~disclosed~~to inthe ~~our~~operation ~~Annual~~of ~~Report~~our onbusiness. ~~Form~~Except ~~10-K~~as ~~for~~disclosed ~~the~~in ~~year~~Note ~~ended December 31~~9, ~~2022.~~Commitments ~~Additionally,~~and ~~we are~~Contingencies, ~~and~~under ~~from~~Regulatory ~~time~~Matters, to ~~time~~our ~~may~~unaudited ~~be,~~condensed aconsolidated ~~party~~financial tostatements ~~routine~~in ~~legal~~this ~~proceedings~~Quarterly ~~incidental~~Report toon Form 10-Q, the ~~operation~~Company ofdoes ~~our~~not ~~business.~~expect ~~The~~that the outcome of any other pending or threatened proceedings, isif ~~not~~determined ~~expected~~adversely to the Company, would individually, or taken together, have a material adverse effect on our financial condition, operating results, or cash flows, based on our current understanding of the relevant facts. Legal expenses incurred related to these contingencies are generally expensed as incurred.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed in Part I, "Item 1A.Risk Factors" in the Company’s Annual Report on Form 10-K for the year ended December 3130, ~~2022~~2023.

3026

Table of Contents

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table presents our share repurchase activity for each month of the ~~fiscal~~ quarter ended ~~September~~March 30, ~~2023~~2024:

Period	Total Number of Shares Purchased (1)	Average Price Paid per Share~~(2)~~		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (32)	Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
July 2 - August 5	20,000	$	87.66	20,000	$	20,290,260
December 31 - February 3	—	$	—	—	$	91,429,309
August 6 - September 2	101,995	$	84.73	101,507	$	11,689,512
February 4 - March 2	6,769	$	129.35	—	$	91,429,309
September 3 - September 30	97,974	$	84.53	95,000	$	3,662,571
March 3 - March 30	290	$	116.26	—	$	91,429,309
Total	~~219~~7,~~969~~059			~~216,507~~—

(1) ~~Includes~~ Represents shares withheld by us in connection with tax withholding obligations of our employees upon vesting of such employees’ restricted stock unit awards.

(2) ~~Excludes~~On ~~any~~October 31, ~~excise~~2023, ~~taxes~~our ~~incurred~~Board of Directors authorized a new share repurchase authorization for up to $100 million. As of March 30, 2024, we had a remaining authorization amount of $91.4 million under ~~The~~the ~~Inflation~~program. ~~Reduction~~With ~~Act~~the remaining availability under the stock repurchase program, we may repurchase our common stock at any time or from time to time, without prior notice, subject to prevailing market conditions and other considerations. Our repurchases may be made through a variety of ~~2022~~methods, which may include open market purchases, privately negotiated transactions, accelerated share repurchase programs, tender offers or pursuant to a trading plan that may be adopted in accordance with the Securities and Exchange Commission Rule 10b5-1. During the three months ended March 30, 2024, the Company did not repurchase any of its common shares under its share repurchase program.

(3) On May 3, 2022, our Board of Directors increased our share repurchase authorization to $100 million, and as of September 30, 2023, we had a remaining authorization amount of approximately $3.7 million under this program, which was fully utilized during early fiscal October 2023. On October 31, 2023, the Company’s Board of Directors authorized a new share repurchase program for $100 million. Under the new share repurchase program, we may repurchase our common stock at any time or from time to time, without prior notice, subject to prevailing market conditions and other considerations. Our repurchases may be made through a variety of methods, which may include open market purchases, privately negotiated transactions, accelerated share repurchase programs, tender offers or pursuant to a trading plan that may be adopted in accordance with the Securities and Exchange Commission Rule 10b5-1.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None of our directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the ~~third~~first quarter of fiscal ~~2023~~2024.

3127

Table of Contents

ITEM 6. EXHIBITS

ExhibitNumber		Description
31.1	*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	**	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	**	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
10.1	±	Employment Agreement, dated July 6, 2023, between BlueLinx Holdings Inc. and Andrew Wamser
101.Def		Definition Linkbase Document.
10.2	±	Transition Agreement, dated July 6, 2023, between BlueLinx Holdings Inc. and Kelly C. Janzen
101.Pre		Presentation Linkbase Document.
101.Def		Definition Linkbase Document.
101.Lab		Labels Linkbase Document.
101.Pre		Presentation Linkbase Document.
101.Cal		Calculation Linkbase Document.
101.Lab		Labels Linkbase Document.
101.Sch		Schema Document.
101.Cal		Calculation Linkbase Document.
101.Ins		Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.Sch		Schema Document.
104		The cover page from this Quarterly Report on Form 10-Q for the quarter ended March 30, 2024, formatted in Inline XBRL.
101.Ins		Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
	*	Filed herewith.
104		The cover page from this Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, formatted in Inline XBRL.
	**	Exhibit is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended.
	*	Filed herewith.
	±	Management contract or compensatory plan or arrangement.
	**	Exhibit is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended.
	±	Management contract or compensatory plan or arrangement.

3228

~~SIGNATURE~~Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		BlueLinx Holdings Inc.
		(Registrant)
Date: October 31, 2023	By:	/s/ Andrew Wamser
Date: April 30, 2024	By:	/s/ Andrew Wamser
		Andrew Wamser
		Senior Vice President and Chief Financial Officer
		(Principal Financial Officer)
Date: October 31, 2023	By:	/s/ Kimberly A. DeBrock
Date: April 30, 2024	By:	/s/ Kimberly A. DeBrock
		Kimberly A. DeBrock
		Vice President and Chief Accounting Officer
		(Principal Accounting Officer)

3329

Defined
Benefit Pension
Plan, Net of Tax

Total Accumulated Other Comprehensive Loss, Net of Tax

April 1, 2023 balance