What Boise Cascade (BCC) Said on Its Q3 Earnings Call

Key Points

• Third-quarter results improved: Sales rose 8% to $1.8 billion and net income increased to $36.4 million. Wood Products EBITDA nearly tripled to $42.7 million, driven by higher plywood prices and stronger engineered-wood volumes.
• Building Materials Distribution faced margin pressure: Sales increased 7%, but EBITDA fell to $66.9 million as supplier-transition costs, lower general-line margins, and higher delivery and fuel expenses weighed on results. Boise Cascade has sold through about 80% of its legacy decking inventory as it transitions to James Hardie products.
• The company expects a softer fourth quarter: Seasonal slowing and supplier transitions are expected to moderate distribution sales, while lower Wood Products volumes and higher costs are forecast to reduce segment EBITDA. Boise Cascade also lowered its 2026 capital-spending outlook to $120 million–$140 million, citing delays to growth projects.

Boise Cascade NYSE: BCC reported third-quarter sales growth and higher earnings as its Wood Products business benefited from stronger plywood pricing and engineered wood product volumes, while its Building Materials Distribution segment navigated supplier-transition costs and a cautious housing market.

Consolidated sales rose 8% from the prior-year quarter to $1.8 billion. Net income totaled $36.4 million, or $1.04 per share, both above year-earlier levels. The results came as total U.S. housing starts declined 4% year over year and single-family starts fell 2%, according to CEO Jeff Strom.

“The operating environment, characterized by rising fuel prices, political uncertainty, and cautious consumers facing growing affordability challenges persisted,” Strom said. “But our focus and execution did not waver.”

Building Materials Distribution Sales Rise, Margins Narrow

Building Materials Distribution, or BMD, generated third-quarter sales of $1.7 billion, up 7% from the third quarter of 2025. The increase reflected a 5% gain in net sales prices and a 2% increase in net sales volumes.

• General line sales increased 4% year over year.
• Commodity sales rose 15%.
• Engineered wood products sales increased 1%.

Despite higher sales, BMD segment EBITDA declined to $66.9 million from $69.8 million a year earlier. Gross margin was 14.3%, down 80 basis points from the prior-year period, while EBITDA margin fell to 4% from 4.5%.

CFO Kelly Hibbs said the margin pressure reflected lower general-line product margins associated with destocking during the company’s composite decking supplier transition. Higher commodity-product margins partly offset that impact. Selling and distribution expenses increased $6.9 million from a year earlier, with roughly 80% of the increase tied to higher outbound delivery and fuel costs.

The company is transitioning to James Hardie as its exclusive supplier of siding, composite decking, PVC trim and fiber-cement trim. Strom said the transition is progressing as expected, with Boise Cascade reducing legacy inventory and loading new products into its distribution network.

Jo Barney, who leads BMD operations, said siding sales increased significantly during the third quarter and more than offset the reduction in legacy decking sales. The company has sold through about 80% of its legacy decking inventory, she said, but expects fourth-quarter decking sales to be “noisy” as it shifts its focus toward TimberTech products.

“Fourth quarter probably becomes our base level of sales on decking, and then we’ll start to gain upward momentum as we move into 2027,” Barney said.

Wood Products EBITDA Improves on Plywood Prices

Wood Products sales, including sales to the distribution segment, increased 16% year over year to $461.2 million. Segment EBITDA rose to $42.7 million from $14.5 million in the prior-year quarter, driven primarily by higher plywood prices and increased engineered wood product volumes.

I-joist volume rose 10% year over year, while laminated veneer lumber, or LVL, volume increased 18%. Pricing for both I-joists and LVL was flat from both the prior year and the second quarter. Hibbs said pricing remained stable for four consecutive quarters, supported by contractual price protections, competitive adjustments and rebates related to Canadian sales subject to tariffs.

Plywood volumes totaled 362 million feet, down from 387 million feet a year earlier and 368 million feet in the second quarter. Boise Cascade attributed the decline to greater use of veneer in engineered wood products. Average plywood net sales price increased 31% year over year and 8% sequentially to $425 per thousand.

The company said plywood pricing benefited from trade-policy developments. Brazilian plywood imports declined 12% year over year through the third quarter, while U.S. tariffs of 50% on Canadian veneer, plywood and LVL imports imposed in August affected western plywood markets.

Fourth-Quarter Outlook Reflects Seasonal and Transition Headwinds

Boise Cascade forecast fourth-quarter BMD EBITDA of $35 million to $45 million, with gross margins expected between 14% and 14.75%. Daily BMD sales in October had decelerated from the third-quarter pace of $26.1 million per day, and the company expects further moderation because of seasonal slowing and supplier transitions.

Hibbs said fourth-quarter daily sales could be near last year’s fourth-quarter pace of approximately $22 million per day, or potentially “a little softer” because of the supplier-transition activity. The James Hardie agreement includes financial assistance provisions intended to support the sales ramp, which may temporarily elevate reported gross-margin percentages.

Wood Products fourth-quarter EBITDA is expected to range from $10 million to $20 million. Boise Cascade expects sequential engineered wood product volumes to decline by the high teens to mid-20% range, while plywood volumes are expected to decline by the mid- to high-single digits. EWP pricing is expected to rise slightly sequentially, while quarter-to-date plywood realizations were approximately 5% above the third-quarter average.

Troy Little, who leads Wood Products, said lower volumes and higher costs are expected to weigh on fourth-quarter results. The company expects higher resin and oriented strand board web-stock costs, as well as greater per-unit manufacturing costs from lower production volumes. Boise Cascade may take market-related downtime, if needed, to align supply with demand.

Capital Spending Reduced as Projects Shift

Boise Cascade spent $90 million on capital expenditures during the first nine months of 2026, including $27 million in the third quarter. The company reduced its full-year capital spending range to $120 million to $140 million, primarily because of delays in BMD organic-growth projects involving permitting, contractors, materials and equipment.

The company paid $26 million in regular dividends through the first nine months of the year and said its board approved a quarterly dividend of $0.23 per share to be paid in mid-December. Through the first 10 months of 2026, Boise Cascade repurchased approximately $118 million of common stock, with about $120 million remaining under its repurchase authorization at the end of October.

Looking ahead, Strom said high fuel prices, higher benchmark interest rates and affordability pressures are likely to remain headwinds for construction activity. He noted that early industry projections call for housing starts to decline by the mid-single digits in 2027 from 2026 levels, but said the company believes its integrated manufacturing, inventory and logistics model positions it to respond to changing customer needs.

About Boise Cascade (NYSE:BCC)

Boise Cascade Company is a U.S.-based manufacturer of engineered wood products and a wholesale distributor of building materials. Headquartered in Boise, Idaho, the company serves the residential construction, repair and remodeling, and industrial sectors primarily across the United States.

Through its Wood Products segment, Boise Cascade manufactures laminated veneer lumber, I-joists, laminated strand lumber, plywood, and other engineered wood products used in floors, roofs, walls, and structural applications.

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