Boise Cascade Company Reports 2015 Second Quarter Net Income of $20.2 Million on Sales of $955.4 Million

For Immediate Release:  July 23, 2015

BOISE, Idaho - Boise Cascade Company (Boise Cascade or Company) BCC today reported net income of $20.2 million, or $0.51 per share, on sales of $955.4 million for the second quarter ended June 30, 2015.

Second Quarter 2015 Highlights

		2Q 2015				2Q 2014				% change
		(thousands, except per-share data and percentages)
Consolidated Results
Sales		$	955,397			$	961,187			(1	)%
Net income		20,230				26,418				(23	)%
Net income per common share - diluted		0.51				0.67				(24	)%
EBITDA1		50,681				58,652				(14	)%
Segment Results
Wood Products sales		$	339,869			$	351,011			(3	)%
Wood Products EBITDA1		34,053				41,257				(17	)%
Building Materials Distribution sales		762,078				758,375				-	%
Building Materials Distribution EBITDA1		22,450				21,795				3	%
Corporate EBITDA1		(5,822		)		(4,400		)		(32	)%

¹ For reconciliations of non-GAAP measures, see summary notes at the end of this press release.

            In second quarter 2015, total and single-family U.S. housing starts increased approximately 16% and 12%, respectively, from the same period last year. The July 2015 Blue Chip consensus forecast for 2015 reflects 1.11 million total U.S. housing starts, an 11% expected increase from 2014 levels. At that level, total housing starts would remain below the historical average for the last 20 years of approximately 1.3 million starts per year.

            "Building Materials Distribution (BMD) performed better this quarter as commodity prices stabilized and gross margins improved; however, sales volumes in April and May were disappointing, partially due to unusually wet weather in Texas and the Southeast. June sales and earnings results for BMD were much stronger. Wood Products' performance was negatively impacted by lower lumber prices and operating challenges at our North and South Carolina plywood operations during the quarter. We were able to make good progress on the start-up of the new dryer at our South Carolina operation in June after working through construction and installation issues in April and May. I am pleased by the way our other Wood Products regions performed during the quarter. We continue to believe the demand for new residential construction will be modestly higher in the second half of 2015, which should benefit both of our businesses," commented Tom Corrick, CEO.

Wood Products

            Sales, including sales to BMD, decreased $11.1 million, or 3%, to $339.9 million for the three months ended June 30, 2015, from $351.0 million for the three months ended June 30, 2014. The decrease in sales was driven primarily by decreases in plywood sales volumes and lumber sales prices of 5% and 16%, respectively. These decreases were offset partially by a sales price increase of 3% in I-joists. Sales volumes of I-joists, LVL, and lumber, as well as plywood and LVL sales prices, were relatively flat compared with the three months ended June 30, 2014.

            Wood Products EBITDA decreased $7.2 million to $34.1 million for the three months ended June 30, 2015, from $41.3 million for the three months ended June 30, 2014. The decline in EBITDA was due primarily to lower lumber sales prices, as well as higher per-unit labor and other manufacturing costs due to lower plywood sales volumes, offset partially by higher I-joist sales prices.

Building Materials Distribution

            Sales increased $3.7 million to $762.1 million for the three months ended June 30, 2015, from $758.4 million for the three months ended June 30, 2014. Compared with the same quarter in the prior year, the overall increase in sales was driven by sales volume increases of 3%, offset by a decrease in sales prices of 3%. By product line, commodity sales decreased 7%, general line product sales increased 10%, and sales of engineered wood products (substantially all of which are sourced through our Wood Products segment) increased 2%.

            BMD EBITDA increased $0.7 million to $22.5 million for the three months ended June 30, 2015, from $21.8 million for the three months ended June 30, 2014. The increase in EBITDA was driven primarily by a higher gross margin of $1.6 million, offset partially by increased selling and distribution expenses of $0.9 million.

Corporate and Other

            Segment EBITDA was negative $5.9 million for the three months ended June 30, 2015, an increase of $1.4 million, from negative $4.4 million for the three months ended June 30, 2014. Beginning in first quarter 2015, all pension expense is reported in our Corporate and Other segment. We reported $0.8 million of pension expense in second quarter 2015 which drove the negative variance in Corporate and Other. For comparison, pension expense was less than $0.1 million in second quarter 2014, most of which was recorded in Wood Products and BMD.

Balance Sheet

                Boise Cascade ended the second quarter with $194.9 million of cash and cash equivalents and $314.7 million of undrawn committed bank line availability, for total available liquidity of $509.6 million. The Company reported $351.3 million of outstanding debt at June 30, 2015.

            In May, the Company amended its bank credit facility to add a $50 million seven-year term loan and extend the maturity of the $350 million revolving credit component of the facility to April 30, 2020. Proceeds from the term loan were used to fund a $40 million discretionary contribution to the Company's pension plan, with the remaining proceeds used for general corporate purposes.

            During second quarter 2015, the Company repurchased 175,085 shares of its common stock for $6.1 million. In July, the Company repurchased an additional 58,661 shares for $2.0 million.

Outlook

            We expect to experience modest demand growth for the products we manufacture and distribute during the balance of 2015 and remain optimistic that the overall improvement in demand for our products will continue as housing recovers to historic trend levels. We expect to manage our production levels to our sales demand, which will likely result in operating some of our facilities below their capacity until demand improves further. Composite structural panel and lumber prices have been historically volatile and future commodity product pricing could be volatile in response to industry capacity restarts and operating rates, net import and export activity, inventory levels in various distribution channels, and seasonal demand patterns.

About Boise Cascade

            Boise Cascade Company is one of the largest producers of plywood and engineered wood products in North America and a leading U.S. wholesale distributor of building products. For more information, please visit our website at www.bc.com.

Webcast and Conference Call

            Boise Cascade will host a webcast and conference call on Thursday, July 23, at 11 a.m. Eastern, at which time we will review the Company's second quarter.

            You can join the webcast through our website by going to www.bc.com and clicking on the Event Calendar link under the Investor Relations heading. Please go to the website at least 15 minutes before the start of the webcast to register. To join the conference call, dial 855-209-5834 (international callers should dial 315-625-6883), participant passcode 80898677, at least 10 minutes before the start of the call.

            The archived webcast will be available in the Investor Relations section of our website. A replay of the conference call will be available from Thursday, July 23, at 2 p.m. Eastern through Thursday, July 30, at 11 p.m. Eastern. Replay numbers are 855-859-2056 for U.S. calls and 404-537-3406 for international calls, and the passcode will be 80898677.

Basis of Presentation

            We refer to the term EBITDA in this earnings release as a supplemental measure of our performance and liquidity that is not required by or presented in accordance with generally accepted accounting principles in the United States ("GAAP"). We define EBITDA as income before interest (interest expense and interest income), income taxes, and depreciation and amortization.

            EBITDA is the primary measure used by our management to evaluate segment operating performance and to decide how to allocate resources to segments. We believe EBITDA is useful to investors because it provides a means to evaluate the operating performance of our segments and our Company on an ongoing basis using criteria that are used by our management and because it is frequently used by investors and other interested parties when comparing companies in our industry that have different financing and capital structures and/or tax rates. We believe EBITDA is a meaningful measure because it presents a transparent view of our recurring operating performance and allows management to readily view operating trends, perform analytical comparisons, and identify strategies to improve operating performance. EBITDA, however, is not a measure of our liquidity or financial performance under GAAP and should not be considered as an alternative to net income, income from operations, or any other performance measure derived in accordance with GAAP or as an alternative to cash flow from operating activities as a measure of our liquidity. The use of EBITDA instead of net income or segment income has limitations as an analytical tool, including the inability to determine profitability; the exclusion of interest expense, interest income, and associated significant cash requirements; and the exclusion of depreciation and amortization, which represent unavoidable operating costs. Management compensates for these limitations by relying on our GAAP results. Our measure of EBITDA is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation.

Forward-Looking Statements

            This news release contains statements that are "forward looking" within the Private Securities Litigation Reform Act of 1995. These statements speak only as of the date of this press release. While they are based on the current expectations and beliefs of management, they are subject to a number of uncertainties and assumptions that could cause actual results to differ from the expectations expressed in this release.

Boise Cascade Company
Consolidated Statements of Operations
(unaudited, in thousands, except per-share data)

	Three Months Ended												Six Months Ended
	June 30								March 31,  2015				June 30
	2015				2014								2015				2014
Sales	$	955,397			$	961,187			$	809,903			$	1,765,300			$	1,728,367
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation)	824,583				823,532				705,039				1,529,622				1,496,140
Depreciation and amortization	13,281				12,482				13,587				26,868				24,802
Selling and distribution expenses	68,254				67,181				61,880				130,134				126,111
General and administrative expenses	12,018				11,925				12,008				24,026				22,590
Other (income) expense, net	(98		)		163				(299		)		(397		)		(1,737		)
	918,038				915,283				792,215				1,710,253				1,667,906
Income from operations	37,359				45,904				17,688				55,047				60,461
Foreign currency exchange gain (loss)	41				266				(107		)		(66		)		177
Interest expense	(5,591		)		(5,519		)		(5,481		)		(11,072		)		(11,031		)
Interest income	58				53				90				148				123
	(5,492		)		(5,200		)		(5,498		)		(10,990		)		(10,731		)
Income before income taxes	31,867				40,704				12,190				44,057				49,730
Income tax provision	(11,637		)		(14,286		)		(4,573		)		(16,210		)		(17,747		)
Net income	$	20,230			$	26,418			$	7,617			$	27,847			$	31,983
Weighted average common shares outstanding:
Basic	39,494				39,420				39,498				39,496				39,399
Diluted	39,600				39,463				39,622				39,604				39,458
Net income per common share:
Basic	$	0.51			$	0.67			$	0.19			$	0.71			$	0.81
Diluted	$	0.51			$	0.67			$	0.19			$	0.70			$	0.81

Wood Products Segment
Statements of Operations
(unaudited, in thousands, except percentages)

	Three Months Ended												Six Months Ended
	June 30								March 31,  2015				June 30
	2015				2014								2015				2014
Segment sales	$	339,869			$	351,011			$	309,316			$	649,185			$644,285
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation)	296,276				299,993				268,420				564,696				560,856
Depreciation and amortization	10,341				10,044				10,791				21,132				20,024
Selling and distribution expenses	7,030				7,146				6,675				13,705				13,884
General and administrative expenses	2,514				2,418				2,512				5,026				5,067
Other (income) expense, net	(4		)		197				22				18				194
	316,157				319,798				288,420				604,577				600,025
Segment income	$	23,712			$	31,213			$	20,896			$	44,608			$	44,260
	(percentage of sales)
Segment sales	100.0		%		100.0		%		100.0		%		100.0		%		100.0		%
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation)	87.2		%		85.5		%		86.8		%		87.0		%		87.1		%
Depreciation and amortization	3.0		%		2.9		%		3.5		%		3.3		%		3.1		%
Selling and distribution expenses	2.1		%		2.0		%		2.2		%		2.1		%		2.2		%
General and administrative expenses	0.7		%		0.7		%		0.8		%		0.8		%		0.8		%
Other (income) expense, net	-		%		0.1		%		-		%		-		%		-		%
	93.0		%		91.1		%		93.2		%		93.1		%		93.1		%
Segment income	7.0		%		8.9		%		6.8		%		6.9		%		6.9		%

Building Materials Distribution Segment
Statements of Operations
(unaudited, in thousands, except percentages)

	Three Months Ended												Six Months Ended
	June 30								March 31,  2015				June 30
	2015				2014								2015				2014
Segment sales	$	762,078			$	758,375			$	622,905			$	1,384,983			$	1,343,905
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation)	674,503				672,355				558,361				1,232,864				1,195,699
Depreciation and amortization	2,874				2,394				2,739				5,613				4,701
Selling and distribution expenses	60,910				60,035				54,650				115,560				112,227
General and administrative expenses	4,311				4,232				3,928				8,239				7,998
Other (income) expense, net	(96		)		(42		)		(119		)		(215		)		(1,982		)
	742,502				738,974				619,559				1,362,061				1,318,643
Segment income	$	19,576			$	19,401			$	3,346			$	22,922			$	25,262
	(percentage of sales)
Segment sales	100.0		%		100.0		%		100.0		%		100.0		%		100.0		%
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation)	88.5		%		88.7		%		89.6		%		89.0		%		89.0		%
Depreciation and amortization	0.4		%		0.3		%		0.4		%		0.4		%		0.3		%
Selling and distribution expenses	8.0		%		7.9		%		8.8		%		8.3		%		8.4		%
General and administrative expenses	0.6		%		0.6		%		0.6		%		0.6		%		0.6		%
Other (income) expense, net	-		%		-		%		-		%		-		%		(0.1		)%
	97.4		%		97.4		%		99.5		%		98.3		%		98.1		%
Segment income	2.6		%		2.6		%		0.5		%		1.7		%		1.9		%

Segment Information
(unaudited, in thousands)

	Three Months Ended												Six Months Ended
	June 30								March 31,  2015				June 30
	2015				2014								2015				2014
Segment sales
Wood Products	$	339,869			$	351,011			$	309,316			$	649,185			$	644,285
Building Materials Distribution	762,078				758,375				622,905				1,384,983				1,343,905
Intersegment eliminations	(146,550		)		(148,199		)		(122,318		)		(268,868		)		(259,823		)
	$	955,397			$	961,187			$	809,903			$	1,765,300			$	1,728,367
Segment income (loss)
Wood Products	$	23,712			$	31,213			$	20,896			$	44,608			$	44,260
Building Materials Distribution	19,576				19,401				3,346				22,922				25,262
Corporate and Other (b)	(5,888		)		(4,444		)		(6,661		)		(12,549		)		(8,884		)
	37,400				46,170				17,581				54,981				60,638
Interest expense	(5,591		)		(5,519		)		(5,481		)		(11,072		)		(11,031		)
Interest income	58				53				90				148				123
Income before income taxes	$	31,867			$	40,704			$	12,190			$	44,057			$	49,730
EBITDA (a)
Wood Products	$	34,053			$	41,257			$	31,687			$	65,740			$	64,284
Building Materials Distribution	22,450				21,795				6,085				28,535				29,963
Corporate and Other (b)	(5,822		)		(4,400		)		(6,604		)		(12,426		)		(8,807		)
	$	50,681			$	58,652			$	31,168			$	81,849			$	85,440

See accompanying summary notes to consolidated financial statements and segment information.

Boise Cascade Company
Consolidated Balance Sheets
(unaudited, in thousands)

Boise Cascade Company
Consolidated Balance Sheets (continued)
(unaudited, in thousands, except per-share data)

Boise Cascade Company
Consolidated Statements of Cash Flows
(unaudited, in thousands)

Summary Notes to Consolidated Financial Statements and Segment Information
            The Consolidated Statements of Operations, Segment Statements of Operations, Consolidated Balance Sheets, Consolidated Statements of Cash Flows, and Segment Information do not include all Notes to Consolidated Financial Statements and should be read in conjunction with the Company's 2014 Form 10-K and the Company's other filings with the Securities and Exchange Commission. Net income for all periods presented involved estimates and accruals.

(a)  EBITDA represents income before interest (interest expense and interest income), income taxes, and depreciation and amortization. The following table reconciles net income to EBITDA for the three months ended June 30, 2015 and 2014, and March 31, 2015, and the six months ended June 30, 2015 and 2014:

	Three Months Ended												Six Months Ended
	June 30								March 31,  2015				June 30
	2015				2014								2015				2014
	(unaudited, in thousands)
Net income	$	20,230			$	26,418			$	7,617			$	27,847			$	31,983
Interest expense	5,591				5,519				5,481				11,072				11,031
Interest income	(58		)		(53		)		(90		)		(148		)		(123		)
Income tax provision	11,637				14,286				4,573				16,210				17,747
Depreciation and amortization	13,281				12,482				13,587				26,868				24,802
EBITDA	$	50,681			$	58,652			$	31,168			$	81,849			$	85,440

The following table reconciles segment income (loss) to EBITDA for the three months ended June 30, 2015 and 2014, and March 31, 2015, and the six months ended June 30, 2015 and 2014:

	Three Months Ended												Six Months Ended
	June 30								March 31,  2015				June 30
	2015				2014								2015				2014
	(unaudited, in thousands)
Wood Products
Segment income	$	23,712			$	31,213			$	20,896			$	44,608			$	44,260
Depreciation and amortization	10,341				10,044				10,791				21,132				20,024
EBITDA	34,053				41,257				31,687				65,740				64,284
Building Materials Distribution
Segment income	19,576				19,401				3,346				22,922				25,262
Depreciation and amortization	2,874				2,394				2,739				5,613				4,701
EBITDA	22,450				21,795				6,085				28,535				29,963
Corporate and Other
Segment loss	(5,888		)		(4,444		)		(6,661		)		(12,549		)		(8,884		)
Depreciation and amortization	66				44				57				123				77
EBITDA	(5,822		)		(4,400		)		(6,604		)		(12,426		)		(8,807		)
Total Company EBITDA	$	50,681			$	58,652			$	31,168			$	81,849			$	85,440

(b)  Prior to first quarter 2015, pension expense (which is primarily comprised of interest cost, expected return on plan assets, and amortization of actuarial losses) was recorded in each of our segments based on the associated individual employee roles and responsibilities. However, pension benefits are frozen for most employees and only a small number of hourly employees continue to accrue benefits. Therefore, management believes that recording pension expense in the Corporate and Other segment provides a clearer view of segment operating performance. In first quarter 2015, we made a change in our segment measurement method by recording all pension expense to the Corporate and Other segment. This change in measurement only impacts our segment disclosures, and thus it has no impact on our overall consolidated financial statements. Historical segment income (loss) and EBITDA have not been recast. For the three and six months ended June 30, 2014, less than $0.1 million and $0.2 million, respectively, of pension expense was recorded in each of the Wood Products and Building Materials Distribution segments. Pension expense recorded in Corporate and Other was $0.8 million and $2.9 million, respectively, for the three and six months ended June 30, 2015, compared with less than $0.1 million for each of the three and six months ended June 30, 2014.

Investor contact:  Wayne Rancourt, 208-384-6073

Media contact:  John Sahlberg, 208-384-6451

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