BOISE CASCADE Co

We recorded income from operations of $54.5 million during the three months ended March 31, 2025, compared with income from operations of $133.0 million during the three months ended March 31, 2024. In our Wood Products segment, income decreased $53.5 million to $17.7 million for the three months ended March 31, 2025, from $71.2 million for the three months ended March 31, 2024, due primarily to lower EWP and plywood sales prices, as well as higher per-unit conversion costs as a result of downtime to complete the modernization projects at our Oakdale, Louisiana veneer and plywood mill. In addition, lower EWP sales volumes and higher lumber input costs for solid-sawn I-joist and laminated beam production also contributed to the decrease in segment income. In our BMD segment, income decreased $24.0 million to $48.4 million for the three months ended March 31, 2025, from $72.5 million for the three months ended March 31, 2024, driven by a gross margin decrease of $20.4 million, resulting primarily from lower sales volumes and decreased margins on commodity and EWP products. In addition, depreciation and amortization expense increased $3.3 million. These changes are discussed further in "Our Operating Results" below.

We ended first quarter 2025 with $561.8 million of cash and cash equivalents and $395.7 million of undrawn committed bank line availability, for total available liquidity of $957.5 million. We had $450.0 million of outstanding debt at March 31, 2025. We used $151.5 million of cash during the three months ended March 31, 2025, to fund seasonal working capital increases, capital spending, treasury stock purchases, and dividends paid on our common stock. A further description of our cash sources and uses for the three-month comparative periods are discussed in "Liquidity and Capital Resources" below.

Demand for the products we manufacture, as well as the products we purchase and distribute, is correlated with new residential construction, residential repair-and-remodeling activity, and light commercial construction. Residential construction, particularly new single-family construction, is the key demand driver for the products we manufacture and distribute. Over the past quarter, the operating environment was challenged. In addition to seasonally slower activity, consumer and homebuilder sentiment was dampened due to significant macroeconomic uncertainties and elevated mortgage rates. Given the current environment, 2025 end market demand expectations are difficult to predict, with most forecasts for housing starts ranging between flat to mid-single digit year-over-year declines. Ultimately, the level and expectations for mortgage rates, home affordability, home equity levels, home size, levels of new and existing home inventory for sale, unemployment levels, consumer confidence, and other factors will influence the near-term demand environment. Long term demand drivers for residential construction, characterized by an undersupply in housing units, aging U.S. housing stock, and elevated levels of homeowner equity remain in place.

As a manufacturer of certain commodity products, we have sales and profitability exposure to declines in commodity product prices and rising input costs. Our distribution business purchases and resells a broad mix of products with periods of increasing prices providing the opportunity for higher sales and increased margins, while declining price environments expose us to declines in sales and profitability. Future product pricing, particularly commodity products pricing and input costs, may be volatile in response to economic uncertainties, industry operating rates, supply-related disruptions, imposition of tariffs, transportation constraints or disruptions, net import and export activity, inventory levels in various distribution channels, and seasonal demand patterns. In addition, EWP volumes will continue to be influenced by changes in new single-family housing starts and we expect modest EWP price erosion in the second quarter.