BlueLinx Holdings Inc. reported financial results for the three months ended April 1, 2023. In the Q1 2023, net sales were $798 million, a decrease of $504 million, or 39% when compared to the Q1 2022. Gross profit was $134 million, a decrease of $158 million, or 54%, year-over-year, and gross margin was 16.7%, down 560 basis points from the same period last year.
Net income was $18 million, or $1.94 per diluted share, versus $133 million, or $13.19 per diluted share, in the prior year period. Adjusted net income was $23 million, or $2.53 per diluted share compared to $136 million, or $13.44 per diluted share in the Q1 2022.
Adjusted EBITDA was $47 million, or 5.9% of net sales, for the Q1 2023, as compared to $202 million, or 15.5% of net sales in the Q1 2022, which was an all-time high for Company quarterly Adjusted EBITDA.
Net cash generated from operating activities was $89 million in the Q1 2023 compared to $2 million in the prior year period, and free cash flow was $80 million. The increase in cash generated during the Q1 was driven by a net benefit from working capital, primarily related to a reduction of about $75 million in specialty inventory.
“Our Q1 performance reflected the continued execution of our long-term strategy in a challenging market, guided by a continued focus on high-value specialty categories and operational, pricing, and procurement excellence across our distribution network,” stated Shyam Reddy, President and CEO of BlueLinx. “Despite a decline in demand for building products across our industry since late last year, we worked hard to maintain both our price and cost discipline, resulting in solid margin performance, lower operating expenses and strong operating cash flow.”
“BlueLinx remains well-positioned for future growth by leveraging its national scale, deep supplier and customer relationships and fortified balance sheet,” continued Reddy. “We will remain disciplined in our approach to capital allocation to drive long-term value creation and we intend to repurchase $34 million of the company’s common stock under our existing $100 million dollar share repurchase program in the near term.”
BlueLinx Holdings Inc. is a leading U.S. wholesale distributor of building products.
