Boise Cascade, L.L.C.

Good morning. My name is Lisa, and I will be your conference facilitator today. At this time, I would like to welcome everyone to Boise Concave's third quarter 2022 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer period. If you would like to ask a question during this time, simply press star one one on your telephone. Questions will be taken in the order they are received. Before we begin, I remind you that this call may contain forward-looking statements about the company's future business prospects and anticipated financial performance. These statements are not guarantees of future performance, and the company undertakes no duty to update them. Although these statements reflect management's expectations today, They are subject to a number of business risks and uncertainty. Actual results may differ materially from those expressed or implied in this call. For a discussion of the factors that may cause actual results to differ from the results anticipated, please refer to Boise County's recent filings with the SEC. It is now my pleasure to introduce to you Kelly Hibbs, Vice Senior Vice President, CFO, and Treasurer of Boise Cascades. Mr. Ed, you may begin your conference.

Thank you, Lisa. Good morning, everyone. I would like to welcome you to Boise Cascades third quarter 2022 earnings call and business update. Joining me on today's call are Nate Jorgensen, our CEO, Mike Brown, head of our wood products operations, and Jeff Strom, head of our building materials distribution operations. Turning to slide two, I would point out the information regarding our forward-looking statements. The appendix includes reconciliations from our GAAP net income to EBITDA and adjusted EBITDA and segment income to segment EBITDA. I will now turn the call over to Nate.

Thanks, Kelly. Good morning, everyone. Thank you for joining us for our earnings call today. I'm on slide number three. Our consolidated third quarter sales at $2.2 billion were up 15% from third quarter 2021. Our net income was $219.6 million, or $5.52 per share, compared to net income of $91.7 million, or $2.31 per share, in the year-ago quarter. Both of our businesses reported strong financial results during the third quarter, despite the softening economic landscape. In third quarter 2022, total U.S. housing starts decreased 7%, driven by a decrease in single-family housing starts of 18% compared to the same period last year. Wood Products reported segment EBITDA of $177.3 million in the third quarter compared to $136 million in the year-ago quarter. Wood Products benefited from improved EWP sales realization offset partially by lower plywood sales prices and higher manufacturing costs compared to last year's third quarter. The team at Wood Products did an outstanding job during the quarter of managing the integration efforts of the coastal plywood facilities in both Alabama and Florida. I'm pleased with our progress as we work to expand our EWP capacity and further leverage our integrated business model. Building materials distribution reported segment EBITDA of $161.2 million on sales of $2 billion for the third quarter compared to $22.6 million of segment EBITDA on sales of $1.7 billion in a comparative prior year quarter. We'll be the first to admit that BMD's comp from prior year result wasn't a high bar because of the historic collapse in commodity product pricing during that period. but make no mistake that B&B's performance was very good in an environment that continues to present challenges on many fronts. I'm also pleased that the Board of Directors recently authorized a quarterly dividend of $0.15 per share, payable December 15, 2022. This represents a 25% increase in our quarterly dividend. In addition, our Board also announced a special dividend of $1 per share, our second special dividend of 2022 that is also payable December 15. Kelly will now walk through our financial results in more detail and provide a further update on capital allocation, after which I'll come back to provide our outlook before we take your questions.