BlueLinx Proposes Restructuring Plan
Originally published by: ProSales Magazine — April 21, 2016
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BlueLinx announced today it will close four distribution centers by Dec. 31, stop selling some products, and evaluate opportunities to sell or lease back some of its properties.
The four centers being shuttered are in National City, Calif. (serving the San Diego market); La Puente, Calif. (Los Angeles); Ypsilanti, Mich. (Detroit); and Wausau, Wis. In addition, a BlueLinx staffer said a facility in Canada, near Vancouver, also is being closed.
The changes are part of a plan, also announced today, to improve the company's finances "so that we can continue to invest in the areas of the business consistent with our long term strategic goals,” said Mitch Lewis, the Atlanta-based company's president and chief executive officer.
The closures leave BlueLinx with 40 locations. This map, taken from BlueLinx's website, shows its 48 locations as of early 2016:
Meanwhile, the distributor said it "has identified certain less productive SKUs which it intends to discontinue offering. The company intends to sell through its inventory in these SKUs commencing in the fiscal second quarter." In addition, BlueLinx said it "is currently evaluating sale and/or sale and leaseback opportunities for its owned properties, as part of an initiative to reduce the company’s debt."
BlueLinx reported a $6.1 million net loss in its fiscal fourth quarter ended Jan. 2, improving from its $7.6 million net loss in the year-earlier period. For all of 2015, the net loss totaled $11.6 million, slightly less red ink than its $13.9 million loss the previous year. It hasn't turned a profit in the past five years; rather, its net losses for that period total $127.7 million. The company has $559 million in debt and other long-term liabilities and has spent much of its time recently renegotiating its loans.