Company Obtains Waiver from Lenders
Net loss for the fourth quarter of 2008 was approximately
Loss from continuing operations for 2008 was approximately
-- approximately $41 million for the impairments of certain customer relationships and covenants not to compete, goodwill, certain property and equipment held for sale and certain leasehold improvements -- approximately $13 million of non-recurring expenses to close and consolidate underperforming business units
Already under contraction, single-family housing starts declined further in the fourth quarter as home foreclosures increased, lending standards tightened and rising unemployment sapped consumer confidence. According to the U.S. Census Bureau, in
-- closure of 42 and consolidation of 15 business units deemed as underperforming -- centralization of administrative functions including information systems, accounts payable, payroll and human resources to its existing administrative support center -- employee headcount reductions of 42% in operations and 12% in administration
BMHC also announced today that it has obtained a temporary waiver of certain conditions to borrowing under its credit agreement, which allows the Company to borrow up to
As of
"The significant and ongoing correction in the homebuilding industry as well as costs associated with closing underperforming business units have continued to negatively affect our operating performance," stated
"We remain focused on our goal of realigning our business to fit the current environment. While we met the financial covenants for our credit agreement at the end of the fourth quarter, we believe the agreement will need to be amended to better reflect current and anticipated market conditions."
BMHC will issue a press release announcing the date for reporting full results for the fourth quarter and fiscal year 2008 once the date is finalized.
About BMHC
BMHC is one of the largest providers of building materials and residential construction services in
BUSINESS RISKS AND FORWARD-LOOKING STATEMENTS
There are a number of business risks and uncertainties that affect our operations and therefore could cause future results to differ from past performance or expected results. Additional information regarding business risks and uncertainties is contained in Part II Item 1A of our most recent Form 10-Q. These risks and uncertainties may include, however are not limited to:
-- demand for and supply of single-family homes which is influenced by changes in the overall condition of the U.S. economy, including interest rates, consumer confidence, job formation, availability of credit and other important factors; -- our ability to maintain adequate liquidity, reduce operating costs and increase market share in an industry that has experienced and continues to experience a significant reduction in average annual housing starts; -- our liquidity is dependent on operating performance, an efficient cash conversion cycle and compliance with financial covenants; -- our ability to implement and maintain cost structures that align with sales trends and -- loss of customers as well as changes in the business models of our customers may limit our ability to provide building products and construction services; -- intense competition; -- availability of and our ability to attract, train and retain qualified individuals; -- fluctuations in our costs and availability of sourcing channels for commodity wood products, concrete, steel and other building materials; -- weather conditions including natural catastrophic events; -- exposure to construction defect and product liability claims as well as other legal proceedings; -- disruptions in our information systems; -- actual and perceived vulnerabilities as a result of widespread credit and liquidity concerns, terrorist activities and armed conflict; -- costs and/or restrictions associated with federal, state and other regulations and -- numerous other matters of a local and regional scale, including those of a political, economic, business, competitive or regulatory nature.
Risks related to our shares may include, however are not limited to:
-- price for our shares may fluctuate significantly; -- our shares may be less attractive as they are not traded on a large, more well-known exchange and -- anti-takeover defenses and certain provisions could prevent an acquisition of our company or limit share price.
Certain statements in this news release including those related to expectations about our ability to reach agreement with our lenders on an appropriate waiver and amendment, the impact on our business operations from any non-compliance with financial covenants, homebuilding activity, the impact of our efforts to maintain our preferred supplier status and focus on cost efficiencies, and the realignment of our business are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements about our expectations, anticipated financial results and future business prospects are forward-looking statements. While these statements represent our current judgment on what the future may hold and we believe these judgments are reasonable, these statements involve risks and uncertainties that are important factors that could cause our actual results to differ materially from those in forward-looking statements. These factors include, however are not limited to the risks and uncertainties cited in the above paragraph, as well as the risks that: we may not be able to reach agreement with our lenders with respect to amendments and waivers to our credit facility on terms acceptable to us and our lenders; our non-compliance with the financial covenant may adversely affect our liquidity and our business; our efforts to maintain preferred supplier status and focus on cost efficiencies may not be sufficient to allow us to weather the downturn in the housing industry; and we may not be able to timely and successfully implement our restructuring program and realignment of our business and achieve the benefits that they are designed to provide. Undue reliance should not be placed on such forward-looking statements, as such statements speak only as of the date of this news release. We undertake no obligation to update forward-looking statements.
SOURCE Building Materials Holding Corporation