Good morning, everyone. Thank you for joining us today for our 2022 BlueLinx Investor Day presentation. My name is Ryan Taylor. I joined BlueLinx in October 2021, and I lead our investor relations and treasury functions. We are BlueLinx, America's building products distributor. We have over 2,000 team members who we call the Blue Crew, and we are proud to play an essential role in building America's homes. Over the past one to two years, our board and our executive leadership team have reimagined the possibilities for BlueLinx. That creativity has inspired the title of our presentation today, A Whole New Blue. You'll hear today what we mean by that phrase, but I also hope that you feel what we mean when we say A Whole New Blue. For our team and for some of you who joined us at the dinner last night, the fundamental improvement in our business and the energy and enthusiasm for our future is tangible. By the end of the presentation today, it is our goal that everyone listening has greater clarity on just exactly what we mean by A Whole New Blue. A large portion of the presentation today will be focused on creating future value, and as such, discussions will include several forward-looking statements. Please note the actual results may differ from those forward-looking statements due to various risks and uncertainties, including the risks described in our most recent SEC filings. Reconciliations for all non-GAAP measures presented today can be found in the appendix of our presentation. Also in our appendix you'll find bios for today's speakers. I encourage you to see for yourself just how impressive their backgrounds are. We have an exceptional lineup of speakers for you today. Leading off will be our Chief Executive Officer, Dwight Gibson. Dwight joined BlueLinx in June 2021. Following Dwight will be Mike Wilson, our Senior Vice President of Product Management. Mike joined BlueLinx in 2018 and is an industry expert with over 25 years experience in the building materials space. Josh Teteak leads our supply chain efforts. Josh joined our team in April after a distinguished career at Eaton Corporation and Cooper Industries. Josh is also a veteran of the U.S. Army. Kevin Henry joined our team in February to lead our efforts to build capabilities, attract and retain talent, and drive performance. Kevin is a distinguished and inspirational leader of people. Kelly Janzen, our Chief Financial Officer, who many of you know has served as CFO for BlueLinx for over two years. She has been instrumental in driving transformational change and sowing the seeds for the Whole New Blue that we'll present today. Other members of the Blue Crew with us today include Sean Dwyer, our Chief Strategy and Corporate Development Officer, Shyam Reddy, our Chief Legal and Sustainability Officer, Gregg Argall, who leads our national accounts, Seth Freeman, our VP of Marketing and Communications, Adam Bowen, our Chief Accounting Officer, and some of our regional operational leaders, George, Matt and Mark in the back. Alexandra Lucas, who runs our investor relations with me, is also here today, and a special thanks to Alexandra for her contributions to our event this week. Another special thank you to Natalie and Jennifer for their support of our event this week. Lastly, I'd also like to thank the New York Stock Exchange for hosting us throughout this week and a shout out to Shannon Duffy at the New York Stock Exchange, who has been an extension of our Blue Crew in helping get us prepared for today. A brief look at our agenda. Dwight will kick us off with what it means when we say A Whole New Blue. Mike will follow that with a discussion on our value proposition in the industry and our strategy to accelerate growth. Josh will then share with you our strategy to optimize productivity, and Kevin will describe what we're doing to drive performance. Following that, Kelly will share with you how all these strategic efforts come together to drive value creation for our shareholders. Dwight will close out the presentation with our views on why we think BlueLinx is a very compelling investment. After Dwight's closing remarks, we'll open the meeting to questions. With that, I'd now like to introduce to you our President and CEO, Dwight Gibson. Thank you. Well done, man. Good morning. Good morning. Wow, that's a pretty tepid response. Good morning. Good morning. Excellent. Hey, it's a pleasure for me to be here in New York City. I actually went to high school in Brooklyn, and my mom and my sister still live in Brooklyn. Coming to New York almost always feels a bit like coming home. Double the pleasure of having the opportunity to talk to you about why BlueLinx is really A Whole New Blue and also a bit of a homecoming. I hope you guys enjoy the presentation and let's get started. A couple of things. I think it's always important to orient everyone on why we are really, really excited about the market in which we operate. It's a big one, it's an attractive one, it's growing, and it's an important one to the American economy and to some extent to enabling the American dream. We at BlueLinx believe that we are incredibly well-positioned to be successful in this environment. We have meaningful scale. We operate in a large market that's fairly fragmented, so we think there is a lot of opportunity for us to organically grow and take share. As a testament to a lot of the hard work of the team, we are well-positioned financially to be proactive and to lean into this market. We're gonna do that, and we're gonna do that in a couple ways. We're gonna make sure that we have a growth orientation in our business. We're gonna make sure that we're operating our facilities as safely, efficiently, and effectively as possible, and we're gonna work together in a team environment, a driving performance-based culture to make sure we deliver on our expectations and exceed the expectations of all of our stakeholders. One of the things I really enjoy about this business and why I'm really excited about where we are and more importantly about where we're going is that we have a strong fundamental business. Our core base business is strong. We have scale. We are the leading pure play two-step building products distributor in North America. We have the products that customers want, particularly on the specialty side. Our end market exposure is balanced. You know, many people think that we're all kind of a new home construction organization. That's not the case. Over 45% of our end market exposure is to repair and remodel, which is, we believe, less volatile and drives a higher demand for more specialty-oriented products. We also have a significant piece of our business that's commercial multifamily exposure. The balance, roughly around 40%, is new home construction. We like the markets in which we play, and we think that will serve us well over time. I also believe over the medium and long term the market and the economy is in a healthy position. You know, everyone's familiar with the demographics that are driving, I think, and will continue to drive demand for housing, whether it be new housing, existing homes. I do believe that the way we work, the way we live has fundamentally changed, and that's supportive of continued investment in our home. The economic fundamentals, though there are some clouds on the horizon, I still think are fairly solid, right? Whether it be low levels of unemployment, reasonable wage growth, high levels of home equity. I think all those things together create a fairly supportive environment over the medium and long term for the work that we do. Then more importantly, you know, we are leaning into that, and we're putting in place plans and actions to really take full advantage of our core capabilities, what we believe are our competitive advantages, to accelerate the business forward. We're gonna talk a lot about that today. We're gonna talk about how we're gonna accelerate growth. We're gonna talk about how we're gonna optimize productivity of our distribution branches in our other locations. We're gonna talk about how doing all that in a focused, consistent, high-quality way is gonna drive performance. If we do those three things, I have no doubt we're gonna create reasonable and meaningful value for all of our owners, for all of our stakeholders, and really create something that we believe is a special opportunity here at BlueLinx. Again, just as a context to make sure everyone's familiar with who we are and what we do, a couple of key elements here. Again, relatively evenly distributed across the country in terms of size, west, south, central, north, and east. We touch 46 of the lower 48 states with our products and our services, and we have great presence in the MSAs that are delivering real growth. Large number of suppliers, larger number of customers, and we call Atlanta home. Tremendous results. If I look back, you know, in my year now, it'll be one year for me exactly next Tuesday, and I think about what we've been able to accomplish, I couldn't be more proud of this team. I couldn't be more proud of our people and all the hard work that we've put into it. Tremendous 2021, record year for us across multiple dimensions. An important piece I think that's often gets overlooked is where and how we make our money. Our specialty business is really what drives our profitability. It's also where a lot of our expertise and value-added services really come into play, and that will be an enduring theme if we talk about today how we drive disproportionate growth in our specialty business and how we drive that mix to an even higher level than the almost 60% you see on the slide. Again, if you look back from 2019 through 2021, I think, the strength of our financial performance is unquestioned. Whether it be on the top line, 27% sales growth, that's translated into really significant adjusted EBITDA growth and tremendous margin expansion. That, again, is a testament to obviously a supportive end market environment, but I think a lot of hard work by this team around managing our commodity inventory in a much more disciplined way, about engaging in much more sophisticated and disciplined actions around pricing, around starting to really think about how we can get stronger and better again in these specialty categories that we believe we bring a lot of value to. I'm really proud of the efforts the team have put in place to enable this level of really, really impressive financial performance over the last three years, and we're not done. Again, if you think about the last six quarters in particular and really, you know, the balance of my time with the organization, there's some specific things we've done that has allowed us to really drive, I would argue, outsized performance over the spectrum. Even that considers a fairly significant pullback in commodity prices in the third quarter of 2021, where we saw 70% reduction in pricing. We were still able to deliver fairly solid results. Again, it's a testament to the team's execution, the team's discipline, and the team's focus. We feel really proud of what we've done, and we're committed to continuing to drive a level of performance in the company that's impressive. You know, we couldn't have a conversation about a business that touches the housing market without talking a bit about what's happening. You know, we take a very clear-eyed view of the market. You know, if you look at some of the indicators that we track, whether it be remodeling, whether it be starts, supply, you know, again, we believe that the signals are fairly stable. Without question, we're in a rising interest rate environment. Without question, that's gonna put some pressure on new homes, particularly I think at the first-time home buyer level. Again, that's 40% of our exposure. We like how things look for the balance of 2022. Backlogs are still pretty strong. Demand's still really, really strong, and we have the opportunity to continue to participate and supply that. We believe, again, for 2022 and as we move into 2023, the end market environment remains fairly solid. One of the things that I think is really important to spend a little bit of time talking about is some of the broader macro trends that we think are at play here and will be enduring over time. I think hybrid work is here to stay. I think remote work is here to stay. I think if we think about today and tomorrow, the percentage of folks who are gonna operate in that environment is significantly higher, and it's gonna stay fairly sticky, I think, over time, just because we've seen that it works. We see that it allows for people to kind of enjoy a better work-life balance and drive a level of engagement in the organization that I think is meaningful. You know, that's something we've done at BlueLinx. We transitioned to a hybrid work schedule, where it's three days in the office, two days out, and it's worked really, really well. I think that's gonna be more of the norm than the exception. The other dimension here is something we look at very closely is homeowner's equity. Again, if you think back, around 45% of our demand is driven from repair and remodel. Home equity is a big enabler of that, and given the significant price appreciation we've seen in housing over the past couple years, again, a function of supply and demand, homeowners have the capacity to invest in their homes. They're spending more time at their homes doing different things, so we think that is gonna be supportive of repair and remodel over time, and it's something that we could take full advantage of. We're gonna talk about four things again today, and I kinda teed them up earlier, around why we really, really believe that it is A Whole New Blue. Growth is really our first priority. Our expectation is that we can drive sustainable, profitable growth over the medium and long term based on the actions we're gonna take. Mike's gonna talk a bit more about some of the things we're doing there, around how we're thinking about our customers, how we're thinking about our products. I'm really excited for you guys to hear and participate in that conversation. Again, we have to make sure that we're operating our distribution organization as safely, as effectively, and as efficiently as possible, and I believe we have meaningful opportunity to move forward in that path. I'm excited to have Josh on the team, and he's gonna share some of those details around how we can better leverage our procurement spend, how we can drive greater standardization across our network around best practices to make our operations more efficient, make our work environments more engaging for our people. We're investing significantly in our footprint, whether it be the rolling stock or other facility improvements, which will lower the cost to operate this business. I'm really excited to have that conversation as well and looking forward to Josh sharing some of those details with all of you. This all only works if we drive performance, if we hold ourselves accountable. I'm accountable, my team's accountable, our people are accountable for making sure we deliver on our commitments. We've taken, I think, meaningful strides in terms of how we drive alignment from the front line all the way up to the board around our strategy and around delivering against our strategy, and I think that's a differentiator for us and will become an even greater one over time. I have every confidence that if we can accelerate growth, if we can optimize our productivity, if we can consistently drive performance, we will continue to create value. We've created meaningful value in the past year, in the past couple years. Again, I think, we're still in the first innings of our journey here and the runway is long. I am so excited about the significant potential and opportunity that exists in our business to continue to make it better and create more value for all of our key stakeholders. Accelerating growth, a couple key elements to this, specialty. Specialty drives our business today. We're gonna lean into that in a bigger way, and our aspiration is to make that 80% of our mix. That's some of these key categories that we like. It's engineered wood, it's molding and millwork, it's industrials, it's siding, it's outdoor living. We believe we have meaningful capability there that our customers value, and we're gonna make sure we can kinda drive that at an even higher pace. Our customers. We understand who our customers are, we understand the role they play in our business, and we wanna make sure that we are servicing our critical customers, our best customers, in a superior way. We think if we do that, we'll get the opportunity to earn more of their business, and we can accelerate growth. There are a lot of markets we like. We're in most of them. There's some more that we'd like to be in, so we're gonna be thoughtful and intentional about how we do that. We bring more than warehousing capability. We bring other value-added services, and Mike will talk a bit more about that. That creates a stickiness with our customer base that we think is meaningful and will enable growth. Productivity starts with safety for me. I've challenged the team to be the safest organization in our industry. We've made good progress there. I think there's more work to be done. I think if you have a safe organization, you have an organization where people feel appreciated, where people feel as if they can engage and can give you a discretionary effort, and you'll see that show up in your performance. We have many locations across this country. I've been to 80% of them. Our people are there working hard, doing great things. We can help them to be more efficient. We can help them to operate more consistently. If we do that, we're gonna lower our cost to serve, and we're gonna create margin expansion opportunity. We buy a lot. We spend a significant amount of money, given our scale. I think we can be even more efficient and effective with that spend. That will be great for our business. We've made great strides as we've tackled our working capital, particularly around our structural inventory. I think our performance there has been elite, and that's an enduring capability that we're gonna build on and really translate across all of our inventory performance. I am so proud of the leadership team that we have in place, and I'll spend a little bit more time talking about that. That's something I've spent a fair amount of my initial first year doing, making sure we had the capability, the capacity, and the attitude to really realize the full potential of what I think is a tremendous business, and I would put my leadership team up against anyone. I think functionally and operationally and commercially, we can get the job done and so excited about making this happen with all of them. You know, one of the things that I'm really intentional about and hope that the organization is starting to demonstrate and people can feel this externally, it's around performance. You know, talk is cheap. Performance is really what gets the job done. We're really intentional about creating a culture at BlueLinx around accountability and around delivering and around driving elite level performance. It's not doing a little bit better than we've done before. It's about raising the bar and having actions and plans and a governance process in place, and an expectation that we're gonna deliver. We're really off to a great start in that dimension, and Kevin will share a little bit more about that. That all requires the right level of capabilities to make sure that we can deliver on these high expectations and an engaged workforce. If you have an engaged workforce, you're gonna have people that are gonna make the business better. You're gonna have people that are gonna think about how they can make the business better without being told. We're excited about the progress we're making and the things we're doing to enable that. Value. I think Kelly's gonna have a lot of fun in this part of the presentation. I think we have a great story to tell. We've done some meaningful things to create meaningful value for all of our owners, and we are still on the path to continue to extend that. You know, profitable growth, key area for our focus. We're gonna make that happen. Our financial performance is better, and I think it's sustainably better. We're excited about that. We're committed to making sure that's the case. Team did a lot of work to get us to a position where we have a really strong balance sheet, and we wanna be real stewards of that and make sure that we're deploying the capital in ways that are gonna create returns greater than our cost of capital and create great returns for our business. We're gonna be thoughtful and disciplined in how we think about our capital allocation, whether it be organic investments or whether it be inorganic investments or returning, cash to shareholders. I think our value creation opportunity and the thesis around that is very, very compelling and excited about, sharing more details of that with you over the course of the next, hour and a half. I wanted to come back to this because I think it's really important. I think, if you look across any organization, whether it be a corporation, a sports team, a nonprofit, whatever it may be, it starts with the leadership, and it starts with the capabilities, in the organization and the leader's ability, to get the best out of our people. You know, our responsibility as a leader is to extend the boundaries of what's possible, is to unleash the potential that's inherent in all of the people, all the teammates at BlueLinx. I believe we are well on our path to putting in place a leadership team that can do that. It's a team of proven leaders. It's a team of diverse backgrounds. We have folks from a manufacturing environment, from consumer goods environments. These are folks that are experts in their field, whether it be strategy, whether it be M&A, whether it be operations, whether it be people, whether it be finance, and they have an orientation around how are we gonna grow this business? We are not satisfied unless we're growing. You know, we're not satisfied unless we're driving profitable growth and holding ourselves accountable for what we're delivering. I am incredibly pleased with the team we have. It's a team that can drive growth. It's a team that can make our operations easier to operate and reduce the cost to serve. It's a team that will absolutely, without question, drive a level of performance that I think will be exceptional in our space. You know, for all that to happen, you gotta make sure that we're holding people accountable, and there's a governance model in around that. I wanted to make sure everyone had transparency to how we're gonna make all these things that we talk about happen. It's really simple, and this is a rubric and a methodology I've used throughout my career, and it's really around four things. We having a plan and making sure that plan is clear, making sure that plan is rational, making sure that plan's relevant for who you are and the space you operate. Executing that plan, so you have it at a sufficient level of detail, a sufficient level of clarity, that people know what's expected of them and when they need to deliver. Holding people accountable and checking on progress. It's not, "Here's a plan, and let's talk in a year." It's, "Here's a plan, and depending on the plan, what you need to deliver, let's talk in a week, let's talk in a month, let's talk in a quarter, and make sure progress is being made around agreed-upon milestones." If they're not, we're gonna adjust, and we're gonna have countermeasures, and we're gonna make sure we have a plan to get back in place quickly, and people are accountable for that. This is the thinking that governs all the things that we're gonna talk about to do, making sure folks are executing, we're checking on progress, and we're adjusting where need be. I believe and have great confidence that this will allow us to continue to make progress down this runway of opportunity that's in front of us. One of the things I wanna make sure that people understand and appreciate is that we believe that we have an opportunity to really make the environments we operate better, and that's actually good for business. As I think about some of the things we've done and some of the investments we've made in our facilities, it actually reduces our cost to serve. Some of these investments we've made in electric forklifts reduces our repair and maintenance costs. Some of these investments we've made in new trucks and trailers that have better gas mileage is also good for people, also, again, reduce our ongoing costs. We're committed to doing things that are not only good for the business, but also support the environment in a positive way, and we think that can be a differentiator for us over time. Our people. Our people are at the heart and soul of what we do, and creating an environment where they feel connected, where they feel as if they're appreciated, where they feel as if they belong, and they can operate in a safe way, is fundamental to who we are and how we wanna show up in all the environments in which we play. As I mentioned, we're gonna hold ourselves accountable, have the highest level of integrity and accountability in terms of how we govern the business, and really see this as an integral part of being A Whole New Blue. The exciting part. Here's what we think our reality will be in the midterm. I'll spend a little bit of time talking about this, and Kelly will spend even a bit more time talking about it in her section. We believe that, you know, we're a $4.5 billion organization, again, organically, this has no M&A activity in it, in the midterm. That reflects deflation in lumber, taking that down to $450. That reflects a stronger mix of specialty. 75% is what we've kinda modeled here. Holding our structural gross margin around 10% and seeing a little bit more on the specialty side, around 22%. We've been talking about 19%-20%. We believe based on some of these actions we're gonna take over the midterm, we can land at a 22% level and sustain that. If we do that, you're gonna see a gross margin north of 18% and double-digit adjusted EBITDA and free cash flow of over $225 million. We believe this is the opportunity in front of us. We have plans in place to make this happen. This again is a function of us driving and executing at a higher level, driving the mix to the right level, driving operational improvement, and making sure we're executing well as it relates to our inventory management and our pricing. We believe this is who BlueLinx is, and you know, we're super excited about making this happen. With that, I'm gonna pass the baton to Mike Wilson, and Mike's gonna talk a bit more about how we're gonna accelerate growth. Here, man. Thanks, Dwight. Good morning again, everyone. I'm Mike Wilson, and I lead our product management team. As Dwight mentioned, I'm gonna talk a little bit about how we're accelerating growth in our business. Before we do that, we'd like to tell you a little bit more about who we are and what we do to support our suppliers and our customers. With that, we have a little video to kinda introduce our business. The sky is the limit. That's certainly how we feel about our business today. We believe we have a significant opportunity to build upon what is already a strong business. With over $4 billion in annual sales, BlueLinx is the largest pure-play, two-step distributor in the building product space. We're an essential player in a complex chain supporting the building products industry. Our role is to play the conduit between building product manufacturers and a broad range of customers, including pro dealers, home centers, cooperatives, specialty distributors. In addition to traditional customers, we also serve specialized commercial and industrial OEM manufacturers. Our customers are commonly referred to as one-step distributors. They sell a variety of builders and contractors, as well as repair and remodel. An end user base that's deep and one that provides significant growth opportunities across our entire specialty products category. We do more than just transport product from A to B. We provide differentiated solutions and daily challenges for both our suppliers and our customers. For our suppliers, we provide sales and marketing support, logistics expertise, and warehouse capabilities. We have over 600 sales associates who serve as a seamless extension of our suppliers' sales force. For our customers, we provide technical product expertise and application knowledge across our entire footprint. We play a valuable role in helping them manage the working capital, provide cost-efficient small quantity orders, and just-in-time delivery. As a result, we're an essential value-added supplier to our customers throughout the ebbs and flows of the housing industry. We are well-positioned to capitalize on both new home construction as well as repair and remodel activity, and our deep, long-standing supplier relationships, our broad product offering, and our integrated value-added services enable us to capitalize on a strong market in both new home construction and renovation markets while delivering exceptional customer service. Next, I wanna talk a little bit about our product offering. With over 70,000 SKUs in our product offering, we provide tremendous breadth of products to our customers. In our suite of specialty products, we offer various types of engineered wood, molding, millwork, siding, decking, and industrial products. We also offer specialty treated lumber in a variety of species such as cedar, cypress, and Douglas fir. In our structural products category, we offer traditional framing lumber and panels. Across all product categories, we offer value-added services such as cutting, fabrication, remanufacturing. We have capabilities in several of our locations to do light manufacturing as well. We also provide value services that are more process-oriented, such as engineered wood design for our customers, automated process ordering, and next-day delivery. In some markets, we offer same-day delivery and job site delivery. Our comprehensive suite of products and services, combined with our scale and our geographic reach, truly differentiates us in the market and makes us one of the most unique distributors in the building product space. Speaking of our geographic presence, this chart on this slide shows the expected growth of new homes and repair remodel activity. The key takeaway here, as Dwight mentioned, is that we have locations in 75% of the fastest-growing metropolitan areas. To highlight a few areas of geographic strength for BlueLinx, our private label engineered wood product, branded as onCENTER, is now the number three brand in the industry. Our private label premium PrimeBoard and Shadow Gap program, we refer to it as PrimeLinx, is the preferred product for many pro dealers, for builders, and the retail space. I believe it's the best product on the market. In the South, we're a leading distributor of fiber cement, specifically in the faster-growing areas of fiber cement like Texas and the Southeast. We're also one of the largest distributors of vinyl siding in North America, with an exclusive agreement to distribute Georgia-Pacific vinyl siding. As Dwight mentioned earlier, we distribute in 46 of the lower 48 states. Our product breadth, vast footprint combine to make us a strategic partner for national accounts. Next, we wanna talk a little bit about how we're accelerating our growth. To do that, you really have to have the right partners, and we believe we have that. This is an important point as you look at the strategic partnerships with suppliers and customers. You can see we partner with well-recognized brands, leading national brands and products that are in demand by builders and homeowners, brands like LP, Georgia-Pacific, Ply Gem, Weyerhaeuser, Roseburg, and James Hardie. We are selling some of the fastest-growing players in the home industry, customers who continue to grow in share and footprint and through consolidation, customers like Builders FirstSource, 84 Lumber, and US LBM. With that as a foundation for how we're positioned in the market, let's now turn to our plans to accelerate growth. I think it's important that we point out that we're not just looking to grow for the sake of growth, but we're strategically focused on high-quality growth. Our focus in growing sales in our high-value specialty product mix with our best customers, with an emphasis on strategic markets, which includes the fastest-growing regions and markets, as Dwight mentioned. To continue to build on our value-added services that I'll detail more later. This slide is really a simple illustration of how we're executing on this strategy. First, we've identified five strategic specialty product categories to focus our growth. Second, we've been working with key suppliers of these five specialty products group to secure and grow our product allocation, and we've been successful in that. Third, we've created market-specific programs to align our growth strategy with attractive regions and end markets. Most importantly, we are aligning our growth with our best customers, aligning our resources and our processes to serve our best customers and create raving fans through world-class service. Digging a little deeper into the product perspective, our goal is to shift our mix to an 80% specialty product mix and 20% structural. Our focus is specific to five key categories, engineered wood, siding, molding and millwork, outdoor living, and industrial products. The bottom right, you can see the qualities that really make these five product categories attractive. For these categories, there's a higher supplier concentration, and generally, they're coveted brands. These products also tend to be stickier with our customers. Importantly, these products generally require some sort of value-added services. Notably, the repair and the remodel trends tend to have a higher concentration of specialty products, and as such, the high levels of home equity investment homeowners are making to improve the quality of their life and home really plays to our advantage. The next slide provides a little more context about who we are and how we're executing on this strategy and the benefits that it provides. To accelerate our growth in the five key product categories, we are selectively working with suppliers of choice with leading products and well-recognized brands. This includes our own private label brands, onCENTER for EWP and PrimeLinx for millwork. In each product category, we either have exclusive distribution rights with one of our key suppliers or a dual distribution agreement, meaning that we're one of two select distributors in a market for a particular brand and/or a region. This approach creates really a level of intimacy with our suppliers and entrenches us in the value chain and really creates a barrier of entry for our competitors. Just as we're being selective with our suppliers, the suppliers that we're aligned with to our key five product categories, we're deliberately partnering with national accounts as a key aspect of our strategy. In 2021, we generated $2 billion in sales with 16 national account customers. We have strategic customer relationships across our four main customer categories, including pro dealers such as Builders FirstSource, 84 Lumber, Carter Lumber, and US LBM. The two largest home centers, Lowe's and Home Depot. Co-ops such as LMC and Do it Best, and specialty distributors such as ABC Supply and Beacon. Notably, in 2021, our national accounts grew at 39%, outpacing our total company growth of 27%. This reflects the benefit of the strategy and our ability to drive growth with our best customers. To give you an example of how we're doing this, we provided a detailed view of the market opportunity with five of our national accounts. These five accounts, our addressable market is approximately $3 billion. Notably, 80% of the opportunity is in four of the five key categories that we're talking about. The other 20% would be in structural products. By our estimates, in 2021, we served just under 10% of this total addressable market. A good portion, but still ample opportunity to gain more share of wallet and align with the resources to support our best customers. Just to reiterate our value proposition to these customers, it really comes down to this. Our comprehensive product offering, our ability to create custom programs that align with our customers, and the capabilities we have around value-added and product services we provide. The leading brands we carry and our own private label brands as well. Next, I wanna share a case study that we've done on Lowe's. Lowe's is one of our largest and fastest-growing national accounts. It's a strategic relationship that's driving growth for both Lowe's and for BlueLinx. This slide shows Lowe's omnichannel approach and how we're supporting and accelerating their ability to execute. As Lowe's described in their presentation to investors, they have a strategic focus on building out their business to better serve the pros. As they attempt to grow with the pro customers they inherited during the pandemic, we are perfectly positioned to be their pro resource with our breadth of products and our knowledge that their customers require. We have sales associates in Lowe's stores today in most of the major markets, working at the pro desk, helping them pull more pro business in. We've been successful in several markets of growing specialty product categories that we're focused on and helping them recently land multiple multifamily projects. We also have a dedicated resource within Lowe's that helps us drive looks to our products, and particularly around specialty products. Our presence on Lowes.com continues to improve, and they have roughly 27 million hits a week on their Lowes.com. This is just another great example of a tailored approach that we are taking to serve our national accounts, and it's just one example of how we partner to grow with, in a focused and personalized way. They're innovative, they're value-added, and they're better serving our customers. Let me wrap up. Really, I just wanna reiterate the core differentiating factors that make us the distributor of choice. We have a great brand and following in the markets we serve. We have a relentless focus on high execution. We have a client and end user base that is broad and deep and attractive to help us achieve an 80% specialty product mix. We are investing in and building a platform to support growth, expanding our value-added services, and improving on our operational efficiencies. We are confident we can further grow our share in the core business by offering innovative solutions and products to our customers and by delivering on a focus of creating raving fans through world-class service. It's really, really exciting time to be a member of the Blue Crew. We have an incredible, resilient group who understands how to work in a teamwork-driven culture. I'm excited about the opportunity ahead for BlueLinx and really excited to be leading this part of our business. Next, I wanna introduce you to our newest member and a really great addition to our team, Josh Teteak. Thank you, Mike. You bet. Good Thursday morning, everybody. With respect to Mike and all my peers here in the room, I just wanna start by telling you guys I got the best job in the company. I've got the best job in the company. I actually get to travel out to all of our locations, and I get to work with our truck drivers and our material handlers and our fabricators, and work alongside them to learn and optimize our footprint to make our company stronger. Excuse me, I'll advance the slide here. I was so excited to come in and say good Thursday morning. A very important part of our ability to execute the growth strategy that Mike just laid out is our ability to deliver strong operational performance in our distribution centers. Here at BlueLinx, we have an advantage. We have a highly engaged workforce. We call them our Blue Crew. This highly engaged workforce gives us the people power necessary to develop more efficient distribution centers capable of delivering a world-class customer experience, enabling margin expansion, and creating the capacity we need to support our growth strategy. Our operational vision is to build a high-performance distribution organization that exceeds the needs of our customers, our suppliers, and our valued employees. The first phase of this optimization effort includes four areas of focus. Our first area of focus is safety. Keeping our Blue Crew safe is an important part of our high-performance culture. In fact, every time we talk to our Blue Crew, we emphasize that the most important thing they can do for us every day is to go home safe. We've made great progress in safety performance. Even when you think about the time we've just come through, a pandemic, a period of peak industry demand, our performance has still improved greatly. While our performance is consistent with our industry peers, as Dwight mentioned earlier, we aspire to be known for world-class safety performance. To that end, we've invested in dedicated safety leadership within our organization. We deployed a very robust 5S program designed to proactively identify and eliminate risks within our distribution centers. The key to any successful safety program is engaged employees. With the energy that I feel as I travel across and meet our employee base, I'm confident that we're well-positioned to deliver on strong safety performance. Our next focus area is a 24-month effort to standardize and optimize our distribution centers utilizing proven tools like value stream mapping, visual management. This 24-month effort, it was built with full consideration for our customers and their expectations around quality and speed. This program is also focused on improving our operational efficiency while increasing our throughput to support growth. Our teams are leveraging actionable data analytics and strong problem-solving tools to attack inefficiencies. We have also developed the ability to share these learnings from one distribution center across our network to drive full realization of the benefits that we achieve. As a part of our optimization effort, we're also investing significantly in our distribution centers. In 2022, we'll deploy $30 million of capital. This includes investments in additional storage and value-added services, those that are needed to fuel growth. This also includes investments in electric forklifts, more efficient tractors and trailers that drive better fuel efficiency, which helps us to manage our cost to serve, expand our margins, and is also consistent with our commitment to environmental responsibility. We will continue to reinvest in our distribution centers in the years to come with a keen focus on building the capacity and the capability to support growth. Process standardization is a key enabler to continuous improvement and operational excellence. Process standardization reduces variation and creates a platform for quickly sharing best practices. Sharing best practices is critical to our ability to scale improvements across our enterprise, and we do think that that's one of the things that makes us different. As we create a learning enterprise and scale improvements across, that'll make us stronger and allow us to really expand our margins. Process rigor and a commitment to learning are cornerstones of the BlueLinx culture that we will continue to cultivate and reward. The great news is we're already starting to see great results from this process standardization effort. Our master data harmonization effort has improved our pick accuracy and the speed of our material handlers. Our facility layout improvements have built on our existing digital platforms and allowed us to improve material location control, the speed of picking, and our inventory accuracy. These initial results are fantastic, and we're excited about the impact as we share these learnings across the organization and continue to standardize and improve our distribution processes. Our next focus area is procurement excellence. Our strategy in this area is to build on the success that we've already demonstrated in managing structural lumber inventory. Leveraging the scale of BlueLinx will create stronger strategic relationships with our suppliers. These stronger relationships will give us the opportunity to increase our access to supply and increase our access to new products. We are also in the initial phases of implementing a SIOP process here at BlueLinx. This will allow us to better connect customer demand to our distribution centers and ultimately to our suppliers. The end result of this SIOP initiative will be stronger control over the end-to-end supply chain that makes BlueLinx easier to do business with for both our customers and our suppliers, and that will also give us the capability to more fluidly connect our inventory decisions to customer demands. As I close, I am confident and excited about our ability to optimize our distribution center platform and deliver a world-class experience for our customers, our suppliers, and our employees. We have a well-defined program for optimization that is already yielding results. We have an engaged workforce. We have experienced leaders capable of delivering this optimization, and we have the financial capacity to invest in optimization. This is a proven recipe for success. Next, I get to hand it over to Kevin Henry, our Chief People Officer, who is extremely experienced at leading highly motivated, high-performance teams and frankly has been a big motivation to me so far in my tenure here at BlueLinx. Kevin. Thanks, Josh. Appreciate it. Good morning. It was an absolute pleasure and delight to have an opportunity to meet and speak with many of you last night. Like Dwight, I'm actually from New York as well, having been born in Queens, and I grew up in Long Island, not too far from here. I see some thumbs up in the audience. Now, I offer that to you, excuse me, as a bit of a warning, in the sense that we're gonna get into some Q&A a little bit later. Lots of thoughtful questions I'm sure that are gonna be asked. I wanna apologize in advance because even though I live in the South, and I've lived in the South for a while, you may get the unsolicited, responsive, reflexive, "Forget about it," response, but I promise I will wrap it with, "Forget about it, sir," or, "Forget about it, ma'am." So I'll be Southern. It really is an honor to be here with you, and represent the Blue Crew, our 2,200+ teammates who work tirelessly to drive performance here at BlueLinx. Now, as Dwight shared, we have A Whole New Blue, and as the video hopefully demonstrated to each of you, the sky is indeed the limit for our company. While you've heard the term used several times this morning, you might be wondering exactly what and who is this Blue Crew that we keep referring to. Well, the honesty is the Blue Crew is both a noun and a verb because it's not only a description of who we are and what we represent, but it's also a description of what we do day in and day out. To be clear, our Blue Crew is a group of inspired, capable, and highly engaged teammates who are aligned against a shared purpose to delight our customers, our suppliers, each other, and importantly, our shareholders, by working effectively and keeping our performance promises. That, ladies and gentlemen, is our Blue Crew. Now, I'd like to take a few minutes and share a few of our building blocks to drive performance through our people here at BlueLinx. Now, it starts with our leadership team, and you've heard reference made to this group previously. Ensuring that we're identifying, attracting, and retaining the very best talent that's available to lead BlueLinx both now and in the future. Now, I'd like to acknowledge all of my teammates, those who are in the room with us here today, as well as those that are joining us virtually, cheering us on and leading their teams. We all know how important culture is to any organization. It's critical that everyone knows their roles, their specific accountabilities, and performance expectations. Now, we believe it's most important that our associates know what winning looks like and that we provide them with the skills and the tools that they need to do so. We also believe that it's important that we have reward systems that are clearly understood and serve to activate and motivate our associates to deliver against those expectations. Now, ensuring we have the right capabilities in the organization, it is critical. Harmonizing and accentuating our current capabilities with new capabilities around process, around growth, and the activation of our teams is job one. By doing these things, we believe devoutly that we'll drive engagement with our teams to deliver levels of sustained performance that represent the excellence and the degree of elitism that we expect from our teams. I'm also excited to share some examples of how we're cultivating our performance-based culture here at BlueLinx. We're proud to share that last year we awarded 100% of eligible associates ownership in our great company. In 2021, our stock was up almost 230%, which makes all of our owners very happy. In addition, we're excited that the majority of our associates participate in short-term incentive plans that are designed to focus our teams on delivering expected performance. In fact, we're really excited to have recently rolled out a quarterly Big Blue bonus program that is intended to activate and motivate our drivers, our material handlers, our fabricators, our frontline associates to deliver performance on behalf of all of our shareholders. We're working on building competencies within the organization to catch people doing things right, both with our leaders, but even more importantly, through peer-to-peer recognition. Lastly, we routinely ask our associates for feedback through both formal and informal mechanisms, and I'm excited to share that in the last quarter, we've seen over a 10% improvement in favorability scores from our associates through this formal process. I want to share a few more specifics about how we're building our performance capabilities across the company and activating our Blue Crew to deliver peak performance. We're intentionally infusing talent into the organization by sharing our story and our employment brand in the marketplace to attract this elite talent that's so important to our success. We're hiring, training, and developing the capabilities of those that we do bring into the organization through a combination of structured as well as on-the-job training. We're also leveraging the diversity that exists within our organization and is represented by our teams with respect to their backgrounds, their circumstances, and beliefs by creating an environment of equity and a strong sense of belonging. All of these activities and more, we believe, make our company an outstanding employer, where our teams can grow in their capability and their capacity while realizing their full personal potential, delivering results, and most importantly, having a good time at it, and having some fun. Now, as Dwight shared in his opening remarks, it really does feel like A Whole New Blue. We're actively engaging the heads, the hearts, and the hands of our teammates. Our culture is taking hold and our walk and our talk is changing. Most importantly, we're delivering results and, as I stated earlier, having fun doing it. Now, these two gentlemen that are reflected up front on the picture on the screen are two teammates who work at our Portland, Maine location. Dwight, Josh, I, and others had the opportunity and the pleasure of meeting and spending time with them just a few weeks ago. Now, the first gentleman, Brian, is a 21-year associate who drives for us, and the other, Scott, is a 65+-year-old associate that joined us less than a year ago after making a career switch and getting his credentials so that he could drive for BlueLinx. Now, by the way, I'd be remiss if I didn't point out the vehicle behind us in the picture is Brian's. I have to be transparent and admit that after seeing how clean and organized that Brian keeps his vehicle, I felt inspired when I got home to wash my own personal vehicles, much to the delight of Mrs. Henry. Now, you've heard my colleagues share their thoughts about what makes BlueLinx different, better, and special. I believe that we have the right strategies and tactics to achieve our ambitions. Most of all, we have the benefit of 2,200+ members of the Blue Crew, strong. They're our secret sauce, and ultimately, they are the ones who power our great company. I'd like to close my remarks by thanking every single one of them for what they do each and every single day on behalf of BlueLinx. Thank you for listening. Now it's my pleasure to introduce Kelly Janzen, our Chief Financial Officer. Kelly. Thank you. Thank you, Kevin. It is really great to have you on our team and thank you all for being here at our first Investor Day here in New York. I mean, it's a dream come true for me, honestly, between today and yesterday with ringing the bell. It's something that I've had envisioned since I joined two years ago when I started thinking about what our strategy would be around, specifically around getting our message out, investor relations. I know a number of you, and I do appreciate you being here, and I appreciate your partnership and getting to know you over the last couple of years since I've joined. With that, we'll skip my picture. How about that? We'll talk a little bit about what I'm gonna give you a little overview of what I'm gonna talk about today, and then I also look forward to the Q&A later as well. You know, I have a lot of excitement around where BlueLinx is going. You know, Dwight mentioned the financial performance of the last two years has been, you know, outstanding, but we're not done yet. We have a lot of opportunity ahead of us. The reason I feel confident about that is because, you know, we've transformed the balance sheet. We really have. You know, net leverage, we closed Q1 at net leverage under one, and with liquidity of about $400 million between cash on hand and revolver capacity. We saw the targets, and I'll talk about them again, and we're just getting started. Having that level of liquidity going forward to be able to deploy towards both organic and inorganic investments is huge for fueling our growth. We're also shifting sales mix to higher value specialty products. You heard it from Mike, the core products that we think are gonna really drive this business to a different level. You know, we have more focus around that. We're able to get traction. We've actually started. You've seen it. I know we've had a really strong market, but we've already started that over the last year. Not only shifting, w e're working towards shifting more from the structural specialty, but within the specialty, we've definitely shifted mix up to those higher value products. I've mentioned that on some of my earnings calls around you know kind of that improvement we've seen in a very tight market. The team's done an excellent job with that. We go into discipline. All of that being said, what I'm extremely proud of and one of the biggest game changers we've had in the last few quarters is the way we've managed our structural business. We have absolutely changed the game on how to approach managing wood-based commodities. We have found a way to change our process to still serve our customers while keeping inventory really, really low. It was kind of quick, but in Dwight's presentation, there's a stat in there that says we've reduced our commodity inventory 68% since 2019. So that has made a huge difference for us and allowed us to optimize margin in a very volatile commodity market. Finally, we've spent a lot of time as a team and with our board on getting a clear, more clear and disciplined capital deployment strategy, capital allocation strategy. You saw that led to our improvement in the share buyback, where we got the share authorization up to $100 million, and then we did the ASR, which is still ongoing. That was. came straight out of that, those discussions that we had around making sure we're getting a lot more clarity around, okay, for now that we have liquidity, how are we gonna deploy that to the best use and to drive the most shareholder value? I love this page because it is really. It's just to see it in real life, you know, the transformation of our balance sheet. Even with issuing the $300 million of senior notes last October, we still reduced gross debt by 14% since 2019. When you think about the maturity on those notes, with seven years out, it's almost like we have permanent financing for the near term, for sure. We did that at a 6% rate in a rising interest rate environment. We've really matured our debt structure. We'll continue. There's still opportunities there, you know, around real estate leases, et cetera, but we have made a huge improvement in how we kinda think about what our capital structure should be. I'll just reiterate again, our net leverage has never been lower. You know, we are going to invest. Josh talked about the capital expenditures. I'll talk a little more about strategic acquisitions. You know, we anticipate we may not stay that low and as we move forward in our longer term strategy, but we're always gonna have very strong financial discipline and stay focused on that. Our target for long-term net leverage is we shouldn't be above really three. You know, on or around three times is where we would put ourselves if we ended up having to as we move forward in a more growth trajectory. Looking back on the three-year performance, just to recap that point, you see that over 70% of our gross profit comes from specialty products in 2021. That is, you know, huge, and that was despite and that was considering the strong structural margins that we had. That's, you know, with that in mind, we still got 70% out of specialty. The specialty business, I really wanna hit home on this. It's. We negotiate with our customers in the specialty business. We have strong vendor partnerships. It's. We use the word stickier. It's more sticky. It's more sustainable. Yes, there's pressures just like any other business, but it's not the commodity business. It's not the same. That's why we have a lot of confidence in our sustainability around this, as we move forward. When we make changes, a lot of those can be sustained, especially if we focus and we execute to the best of our ability. That's why the further mix shift into specialty is our key strategy. That's why it makes sense. Not only is it because of high margins, which is obvious, but actually it's more sustainable. It is something that we feel we can stick. In addition to focusing on sales mix shift, we're also, you know, Josh hit it hard, operational efficiency. You know, it's something I feel very passionate about. We have such a good opportunity to continue to harmonize and bring out the best in our distribution centers, and we've already started doing that. I know Josh is gonna just take that to the next level. Process improvements, transactional process, how our fleet operates, how our logistics operates, all those safety, all of those are areas that we have a lot of opportunity to really move to a best-in-class level. There's no doubt that this team will execute that. You know, with that, another area that I think I believe we can be a leader in is using data and analytics. We've started that process as well. We, over the last year and a half, we built out data warehouses, dashboarding. We've used all of our technology in a much stronger way to provide real-time information to our team so they can make daily better business decisions. We're only gonna continue to build on that and build out our technology platforms and become a digitized driven company, a digital-driven company. You know, I couldn't be more excited about the way that we're gonna move forward here, and that's all gonna be done with financial discipline. I think we've hopefully shown that we can be very disciplined from a financial perspective, and I can assure you that we're going to continue that as the underpinning of how we move forward. Our goal is to grow responsibly. Just to hit home on specialty versus structural, you'll see that in 2021, yes, we had a great market. No doubt about it. Very nice specialty margins far and above higher than the 2020. But 2020 was coming off of it was really good, actually, compared to our historical margins that we had seen in the specialty business. That is execution. You know, that is improved execution, quarter-over-quarter, continuing to drive strategic pricing initiatives, maximize what the market opportunities are giving to us, and continue to change that mix shift within our specialty business. I think that demonstrates that we're on the right path, and we just need to take that further. Will there be puts and takes? Sure. Could there be pricing pressure coming? Absolutely. We have so many different opportunities to kind of set our own destiny here that we feel really good about, you know. Are we gonna hit 24%? I don't know. Our goal of having the 22% in the midterm as sustainable, I think is a very worthwhile goal, and I feel great about that. You know, when you look at structural, again, I can't say it enough around how we've executed on structural business. You know, the Q3 2021, when we first put this page, you're like, "Oh, that looks bad." I'm like, "No, it looks great." You know, the significant decline in wood prices that we saw that quarter and still maintained profitable quarter, I think is a testament to the entire team. You know, alongside of focusing on our profitability, we're also very focused on working capital management. Not just the commodity inventory, but just overall cash cycle days. Our cash cycle days are 20% better than they were in 2019, and that's not just inventory. That is we're really executing receivables. Our payables, we've really tightened that process up as well to the extent we can within an industry that has very short payables. We've pushed that as much as we've, you know. Every day we continue to try to make changes there to optimize that. We are focused on our specialty inventory and optimizing that as well, and that there's still some opportunity there, and that's what we'll continue to focus on in this coming year. But, you know, a greater than 60% return on our working capital over the past four quarters, I think does speak that we have made a lot of good changes, already, despite the opportunities that we still have in front of us. Okay. With that, we'll just come back to this page on our midterm annual targets. You know, I think the backdrop that we just went through, all the actual performance provides the right view of where we're coming from on these annual targets. This is, I think. I can't highlight enough, this is what we plan to sustain. Which is really. In 2021, we actually had a performance that was very similar to this in a huge market, right? A lot of inflation, a big market change. I mean, we thought about what are the different ways to think about midterm targets? Our goal, and we ultimately just concluded we need to be able to sustain that level of performance. In the midterm, it's gonna take some time, but that should be our goal, and we believe we can do it. We believe we can do it for all the reasons we've just gone through in this presentation. If you couple best-in-class customer service with productivity, with mix shift, with strategic pricing, there's no way we can't get there, and sustain this long term and even do better. You know? That would be our goal in the long term to obviously do better. This is organic. This is before we start thinking about inorganic opportunities. Dwight went through the assumptions. I won't rehash that but, I just feel really good about where we're coming out on these goals, and I feel that the team is really energized around making this happen. If we deliver on that, the liquidity we're gonna have in this business to deploy for future growth and future is gonna be significant. The way we think about capital allocation is really we're gonna invest in the business as we need to make sure that we have the right assets in the right place and we're the most efficient possible. That's, you know, our fleet's a big piece of that, our facilities for sure, our people, our technology. There's a number of areas that encompasses. In addition, we are focused on strategic acquisitions. We brought Sean on. We're getting momentum there. We're building out a team and we're gonna always do that with the thought process of having it to be a very strong return and it to be a very strategic reason we would do it. You heard it from Dwight, our goal is growth. That's what we want. That's what this business is gonna be about in the future, is we're gonna grow this business. If we have opportunities like we just did, where we have cash available and we don't have the right investment at that moment in time, we are committed to returning value back to directly to the shareholder through buybacks, and we just did one. It was a perfect opportunity and I'm really excited that we were able to. We're in the process of accomplishing it, but to go ahead and be able to do that for our shareholders in the meantime as we continue to work through these initiatives. I think, you know, one thing I don't wanna miss on this page before I move off of it is we're gonna do this always with strong financial discipline. You know, I know I've said it before, I'm gonna say it again. We're gonna focus on our net leverage is we're gonna keep it. We're gonna be prudent. Our net leverage is gonna stay on or around 3x in the long run if we end up levering up to do or have adjustments to EBITDA to be able to do certain acquisitions. That will always be at the forefront of our mind. With that, a couple of points on how we think about M&A. First and foremost, when we move forward to hopefully acquire a target in the not-so-distant future, we are gonna do it with the specialty product mix in mind. That's gonna be one of the key criteria of how we look at potential targets that would be a good fit for us. We're also gonna be looking at how we can expand into attractive geographies, you know, whether that be a new geography or expand within a geography. Finally, you know, Dwight mentioned about the value-added services. A lot of our specialty products come with these great value-added services, and our customers love that. They love, like, being able to not just get the product but actually get a service that helps and supports their business. Building on that will also be a key thought as we think about the targets that we would look at. I just wanna reiterate on this point. As we consider bringing on, you know, targets and/or incorporating acquisitions into our company, this new leadership team has enormous amount of experience in deal execution and integration. Look at the bios and the backgrounds. This team has been set up to be able to manage through future deals and integration and has a strong track record on being successful at that. I feel confident that as we move forward, we will do an excellent job for everyone to be able to integrate them well and get the value out of them that we should expect. I'm sure you're not surprised that we believe BlueLinx is an excellent investment right now. Our market cap is only a 3x multiple of our 2021 EBITDA. You know, if you said that was an anomaly and 50% of the EBITDA go away, we would still. Our market cap would still translate to a 6x multiple, which is a very, very reasonable multiple for a company like us in the market. In fact, building product distribution is really more around a 7x or 8x multiple. That's why we're here, trying to get our story out, trying to explain what we do, and trying to show that, you know, we are here. We have a sustainable business model, and thus a reasonable multiple should be applied to us. Thus right now, we're a great investment opportunity. 'Cause I have no doubt that it won't be long before people do understand the value that BlueLinx brings to the home building industry. that the days of our balance sheet, you know, our higher leverage and some of the other challenges we've had in the past are gone. Really, there's no way we'll go back to that. To recap this section, we are very well-positioned to deliver profitable growth. There is no doubt. We are committed to sustaining a strong balance sheet. We are committed to that. We are also very committed to sustaining our improved financial performance. We have a number of actions, initiatives. I mean, that's why we have this team. That's why we're doing what we're doing, is we are going to ensure that we make what's been kind of unprecedented the norm. That's our goal. Finally, as we generate cash and liquidity, we are going to have a very disciplined approach on how we deploy that capital, and we're gonna make sure we get a great return for the business and a great return to shareholders. With that, I would like to bring Dwight up, back up and have him close out with his thoughts around why it's also a compelling investment. Thank you so much. Thanks. Fantastic. Thank you, Kelly. Thank you to all the speakers. Hopefully, you don't need to hear too much from me because the team has really hit it home why we really, really are excited about what we're doing, and we're incredibly committed to making great things happen here at BlueLinx. I wanted to really anchor on a couple of things. Again, I mentioned that it's been almost a year since I've been in the chair, and I've taken the opportunity to really spend time listening. I've spent time with all of our employees. I've visited the vast majority of our locations. I've had conversations with all or most of our key customers. I've met with many of our strategic suppliers, and I've also had conversations with many of you in the room or listening virtually, some of our investors and other folks who are really interested in what we're doing and how we're gonna do it. Here's what I heard. From shareholders in particular, I heard, "Hey, your leverage is too high." Well, Kelly just explained that we're now down to less than one turn on our leverage, and we're committed to keeping that at a very good level. Heard concerns around the volatility of our structural business, and we've really reduced our exposure to that business dramatically. Almost 70% reduction in inventory, much tighter process around procurement and pricing and making sure that we can service our customers, but do that efficiently and reduce our exposure. Incredibly proud, and I believe that's an enduring competitive advantage for our business now, and going forward. Execution was a concern. I think, what you've seen not only over the past six quarters but over the past three years, is really a different level of execution, where we are committed to not just meeting expectations but hopefully exceeding those. We have a team and talent that's, you know, making sure that that's what we do each and every day. I can't iterate the point around our valuation. Across every dynamic or across every dimension, across every metric, we're a tremendous investment, and we're gonna continue to make that case as strongly and as clearly as we can. There was a lack of clarity around our growth strategy. What are you guys trying to do? What's your purpose? How are you gonna show up in the marketplace? Again, hopefully you have a clear message of that today. Our strategy is around growth. It's around driving growth in our specialty business, around hugging our best customers in a tighter way and delivering the level of service that is hard for them to turn away from. It's around driving efficiency and effectiveness and safety in our operations. It's around making sure we have a culture of accountability and a commitment to meeting our expectations and doing all the right things for all of our key stakeholders. If we do that, I think the targets that we've talked about are absolutely achievable, and we would aspire to exceed those and make that something that we're known for as an organization. We can and intend to be the preeminent player in our space. We have the team to do it. We have the capabilities to do it. We have the scale to do it, and so we're gonna get it done. That being said, hey, I always wanna make sure that all of the folks affiliated with the organization appreciate the level of clarity we have around how we think about the business. I am incredibly excited about where we are. I'm even more excited about where we're going. The quality of our business has fundamentally improved. We're very confident about building upon that as a strong foundation. That being said, hey, you know, we are in a turbulent environment from a market perspective. You know, there's a lot of anxiety around inflation. There's meaningful concern for that. There's concerns around what will that do for housing as the Fed moves up on the Fed funds rate, which, you know, let's be clear, 0% wasn't sustainable over time, so we're seeing higher mortgage interest rates. What does that mean for new home construction? We believe, again, new home construction, 40% of our business, repair and remodel, bigger portion. Multifamily commercial, another 15%. We think our balanced exposure is good. But even if you were to say, "Listen, we see a meaningful downturn coming," 25%. 25% reduction in our top line volume. We still think we can deliver EBITDA margins at 7%. We see a top line reduction of a quarter of our business, we still think we can deliver EBITDA margins at 7%. Again, if you think back to the slide Kelly shared, even in that dynamic, if you do the math, we're still a really compelling investment. Again, our commitment is to make that point unassailable for all of our key stakeholders. Again, in closing, love the market we're in. It's big, it's important, it's growing. I love our position in it. We have scale. Again, from a pure play independent, we are the largest in the game. We have opportunity for growth because it's an incredibly fragmented market, and we have the capacity organically and the balance sheet to allow us to be proactive in our posture in this market. I think our opportunity to really build business, create scale, create growth, drive margin expansion is sustainable throughout cycles based on all the hard work that's been done to really position ourselves in a strong financial position. No debt maturing anytime soon, generating significant amount of cash, really capable team thinking about the right things to drive efficiencies and reduce our costs to run this business and give us the capacity to continue to invest in things that make sense. That's what we're gonna do. We're gonna focus on accelerating growth, we're gonna continue to optimize productivity, and we're gonna drive and create a culture of performance that allows us to be successful. I'm incredibly appreciative of the opportunity to be a part of this team and to be a part of the Blue Crew. I wanna thank Ryan, I wanna thank Mike, I wanna thank Josh, Kevin, Kelly, the rest of the teammates in the room, and all the folks listening and working hard right now every day to service our customers in a safe, high impact way. I couldn't be more proud of who we are and what we're doing, and I could not be more excited about where we are and where we're going. I look forward to going on that journey with all of you and making great things happen. It is A Whole New Blue, and the sky is indeed the limit. With that, we'll pause and set up for any questions. Thank you. KO and team, yep, thank you. We're gonna shift to our Q&A portion. We're gonna invite all the speakers back up, and bring in some chairs for them to sit on. Like, I don't know the last time we did this in person, so you guys probably remember, but just the ground rules, raise your hand, say your name, company that you're with, state your question, and then we'll let the speakers respond. We'll start with Reuben. Alexandra is gonna be bringing the mic over to you, so just be patient for. Make sure that you repeat your question or speak your question into the mic for those that are listening virtually on the video cast. All right. Well, when we get these chairs set up, we'll start with Reuben. You need to like, tilt a little bit. Reuben Garner with The Benchmark Company. Thank you guys for the presentation and taking my question. I'm gonna start with a multi-parter since I was told to start with one question. First of all, you know, the targets, what's midterm mean in Atlanta, Georgia or Brooklyn or Long Island or wherever you guys are from? Then I guess, you know, the market has been strong in the last couple of years. Can you just give us a sense of what the underlying market assumption is for you guys to get there? You know, I don't wanna make this too long of a question, but how far are you from those levels today if lumber was at $450? Like, what needs to be done internally to get to those targets? Yeah. Well, I'll take the first part of the question related to the timing. The way we thought about it is, it's not five years from now, but it's not next year. There's no specific year, actually, timeline. You know, two to three years is kinda what we were thinking. I think from a market perspective, we're assuming there are some headwinds as it relates to deflation, specifically commodity. We saw that, the commodity pricing down to the historical $450 in there, and we're assuming that, you know, we'll see a little bit of that on the specialty side as well. We are also assuming there's a reasonable demand still within that timeline. We expect that supply would come on a little bit more, and we would be able to have opportunities for market share gain, which has been difficult in recent environment. I'll see if Dwight has anything to add to that. Yeah. No, I think you've captured it, Kelly. You know, we see a, you know, relatively normal market, but, you know, pricing coming back down fairly on the commodity side, which again, isn't the driver for our business. You know, we spent some time today talking about how we're gonna get there. You know, we think there's still a lot of opportunity in the front end of our business. As we think about mix shift, we have access to some products in some markets that we wanna expand that will support that. We've made great strides around pricing. Still more work to do around minimizing leakage and making sure that we're driving consistency in our approach across our portfolio. Josh has talked about all the great things we're doing operationally. That, again, is not reflected now in our current performance, and will drive and support margin expansion over time. Again, for me, it really boils down to having people who can get it done and having the confidence that they could execute and be held accountable and deliver, right? Strategy is great. Execution is where it really shows up in the P&L and the balance sheet, and we're making sure we're emphasizing all those elements now so we can deliver on that in the not too distant future. Can I sneak one more in? Go for it. The specialty goal of getting to 80% of your revenue, I think that points to, you know, well over 90% of your profits coming from the specialty business. You know, I think I looked and back in 2019 that was closer to 60/40, so you guys have probably already made a lot of progress. What else needs to be done to get you there? Is that gonna be an organic initiative? You have a very successful private label business. Is there any plans to expand that into other categories? Just any other color you can give us on how you get there. Yeah, sure. I'll get started. I don't know if Mike has anything you wanna add. Yeah, like you've mentioned, we've already made progress on that journey. We have opportunity to extend availability of some of these specialty products. Outdoor living is a good example, across more of our network. There's things we could do now based on the supplier relationships we have to continue to move the needle forward around our mix and making sure teams are motivated to do that. We absolutely believe that's how we're gonna continue to kinda create differentiation in the market and become more valuable and important to not only our key customers, but our key suppliers as well. Opportunity to do that, we have programs in place and energy around that. You know, we believe that's how we're gonna really create value over time. It simplifies the things that we're focused on, it provides clarity to the team, and I think the outcomes will be really meaningful. We love our private label business. Talked about onCENTER, it's a great business for us on the EWP side. Love to make that even bigger. I love our PrimeLinx business. We're gonna always be thoughtful in looking for opportunities to grow those parts of our portfolio as well. Mike, anything? Yeah. Yeah, Reuben, I would add organically, a lot of opportunity to get to that 80%. We have markets today where we may be rich in millwork in a market, in a sister market we're really not in that business. Organically, a lot of opportunities to grow around these key categories. Industrials, millwork, outdoor living particularly is another great opportunity for us. Then on the private label, continuing to look for products that we can bring to market, that we own the brand. Certainly less risk of disintermediation there. We're continuing to focus around developing new products on our private label. The other thing I'd probably piggyback on that, a lot of those products we're talking about are repair and remodel driven more so than new home construction driven, right? Sure. That also gives us the opportunity to continue to lean into that even if we see some softening in the on the start side. Thanks. Thanks. Walt Liptak with Seaport. I wanted to ask one about just maybe a follow-on to Reuben's question. Just to be clear, the targets that you put out don't include M&A, or does that include some M&A in there to get to the 80%? They do not. Do not. Okay. Do not. Yes. All right. You know, the next thing maybe around compensation. You guys talked about changing the compensation plan for your employees. What's the metrics around that? Kevin? Sure. Well, we've got a number of plans that our employees are covered by. Just the one that I specifically referenced, our Big Blue bonus program for our frontline associates. We've got three primary performance categories. The first is safety. As Dwight and Josh said, everything starts with safety. The second is around individual performance and how those associates are contributing to the performance of their location where they work. The third is the overall profitability of their location. There's an individual component, a team component, and a very strong component that's focused on safety. Okay, great. The P&L part is profit-based or is it revenue-based? Profit. Okay, great. Then maybe a you know, one for Josh and Dwight around the standardization of process. As you've been around visiting all the operations, how variable are the different operations right now, and what's the thing that's gonna make it happen? Is it software or is it, you know, just a realignment of, you know, step-by-step process? You know, what do you think? I'll start, Josh- Okay I'll throw it over there. Too variable, short answer, right? Team's doing great work, working really hard, but there's still opportunity to standardize on the best known ways, I like to say, around best practices in terms of how we pick, how we pack, and how we ship. Just doing that alone, I think, is an enabler of not only better service, but lower cost to serving our business. We think there are things that we can do just from a process perspective, some degree independent of technology, to realize some of those gains. I'll kinda let you lean on. Yeah. You know, as Dwight said, too much variability, but the other thing that's very encouraging is that as we go to sites, we see pockets of excellence. What I would say, Walt, is that the thing we're trying to do is to build the infrastructure to share those pockets of excellence and standardize those across the organization. We're doing that in a couple of ways. One is simply how we connect the organization and create forums to share best practices, and that's gonna be both live and, you know, connected calls where we put our operations managers in forums where they can share those best practices and quickly implement those in other facilities. Others will be virtual tools, like SharePoint sites and others, to catalog and house those. The other thing we're looking at is, you know, we're looking at launching very near term here an operations manager training program that is very focused around taking those best practices coupled with some best in practice tools. I mentioned 5S, I mentioned value stream mapping, visual management, some of those, and how we find standardized ways to push those across the organization to just harvest what we have. Again, islands of excellence that if we can push across, will quickly strengthen the organization. Okay. Great. Maybe one last one since Reuben threw in a last one. Yeah, then this may be an easy one. Why 450? Like, why did we pick that number? Is that, like, an industry number? It's actually the five-year- Like an average? Pre-pandemic, it's the five-year historical average for commodity prices, both for lumber and panels. Okay. Probably even before that, frankly, but we just did the five-year average, and that's how we had been modeling until recently on our very near term. You know, that's been a different number in the last couple of years. It's been closer to $750 last two years. We're just assuming that, you know, at this point, given concerns around the macro and some of the other points that Dwight discussed in that area, that we would take a conservative view. Okay on that. All right. Kurt Yinger from D.A. Davidson. Two questions for Mike first. You know, can you maybe just talk a little bit about the biggest value-added kind of serviced opportunities across the platform right now? And is the opportunity really to expand what you already do across more of the footprint? And maybe why hasn't that happened in the past? Yeah, specifically on value-added to start with, we're investing heavily in job site delivery. A lot of our dealers face the same issues that we face with truck drivers. We've expanded our job site deliveries to probably two-thirds of our locations. We didn't do that prior. The other part would be around EWP. We really invested heavily in our EWP business. From a design standpoint, a typical turn on a set of plans. Customer will send the plans to us, we'll do the takeoff and send that back to them. Industry standard is probably seven days. We've got that down to two days, with our goal being 24 hours or less. The quicker you get those plans back to a dealer and they get it to the builder, it really increases our chances of winning those jobs. Probably I would, you know, turn this back to Kelly or Dwight. The reason we've delayed maybe in expanding some of those value-added in the past was probably around working capital and being able to invest in value-add. Yeah, I would agree with that. Got it. Makes sense. Just second, could you maybe talk a little bit about the strategic market roadmaps, what those look like and might include, and any recent examples of success? Yeah. I'll get us started there. One of the things that Sean's really brought to us once he joined is really taking a really thoughtful look at growth and our markets and trying to understand what are the characteristics of a market that we like. You know, what kind of building happens there? How much that's repair and remodel versus new home starts? How does that align with our locations? How does it align with where our customers are? We've been able to double-click and get a really good view of what are the markets that we really like and we think our opportunity to grow is a little bit easier than others. We have a good view of that. Then we take a look and say, "Hey, if we have capability there, what more can we do, based on the supply we have available?" If we don't, that's an opportunity either for organic expansion or to think about something inorganically. I feel really good about the plan we have in place and the ability to execute against that plan. We think a good portion of that is what's gonna power this growth that we've been talking about. Thank you. All right. This next question comes from Minnesota, Greg Palm with Craig-Hallum. He'd like to know, when it comes to geographic expansion, what are the puts and takes of doing this organically through something like greenfield development versus M&A? I'll start and maybe, you know, Mike can pile in. We evaluate all options, right, for growth. If we like the market and we think there's opportunity for us to hit the ground running there because we have a customer relationship or something, we take that into account. The challenge with doing it from a greenfield perspective is, you know, finding available land to do that, and it's a tight environment, building up that infrastructure quickly. In certain instances it could make sense. You know, one of the things we also look at is if, you know, given the fragmentation of space, if there's people there that we can quickly kind of lean into inorganically, that may be something that allows us to kind of lean into a market quicker, if we can make sure the economics work. We look at both, but from a speed perspective, M&A generally allows you to kind of take advantage a little bit faster and it's a little bit more difficult to kind of find, you know, warehouse space and some of these other things organically, to make that happen at the pace we would like to make it happen. Okay, great. Greg said since Reuben and Walt got an extra question, he's got one more as well. Maybe for Kelly. Especially gross margins over the last four to five quarters have been in excess of 22%, more like 23%-24%. It sounds like there's some level of self-help improvement left to go, so why can't specialty margins be higher than the 22% that you estimate in the midterm? Yeah. Well, what I mentioned earlier was what those assumptions in the mid-term, we are assuming some deflation would potentially occur in specialty. Kind of bringing that down. I had talked about previously some of my earnings calls that we thought it was actually gonna come down more to 19% or 20% potentially. We also are within that, we have some products that are a little bit more aligned with the volatility of the commodity in the commodity side. Some of our specialty treated lumber and panels sometimes will vary. It's not the same pricing, but it does have the variability type of profile that some of the commodities do. That all goes into play to a mix discussion. I do believe that we do have some work to do to really shift the mix sustainably to higher value products to get to that 22% on a consistent basis or higher. I you know I did mention that it would be great to have a you know we're gonna try to do it beyond that, but I think that's a number that we feel comfortable with that we can hit in the midterm if we take some of these actions. There's one person back there. Reuben Garner with Benchmark again. Thanks for letting me ask one more final question. This one's probably a little bit of a tougher one, but I'm curious how you guys think about this. You talked about the valuation of your stock. It's obviously very attractive at these levels. How do you guys, you know, in your targets and you're using $450 lumber, it's in all likelihood gonna be higher than that, and you guys are gonna continue to generate a lot of cash. How do you balance buying back your own stock versus M&A? Are there targets out there that you're gonna be able to get that are as attractive as your own valuation? And how do you think about that? You know. Yeah. Do you weigh in on the growth and the future that comes with an M&A versus maybe your valuation's more attractive in the near term? Yeah. Yeah. You wanna start? I'll start. Yeah. I'll start. Great question, and it's, I guess, somewhat of an interesting problem to have. You know, our commitment is to make investments that increase our future cash flows, right? If you think about over time and how do you create value as a going concern, you know, increasing your future cash flows. For us to do that, we need to be able to grow, we need to be able to sell more, we need to be able to do it more efficiently. That's the priority for us, whether it be organic investments in our facilities, in our capabilities, to enable that. If we see an acquisition as a way to accelerate that's within, you know, our strategic framework that we believe we can create and add value to, I believe will allow us to supercharge and accelerate a performance. We're gonna think about that very, very clearly because again, over the long term, that's what's gonna really generate value. That being said, we're not going to be, you know, rushed about it. We're gonna be very thoughtful about it. We actually believe that given our financial position and the fact that the market's experiencing some turbulence, we may be well positioned to be a prudent purchaser in this environment, quite honestly, if multiples come down and good assets are available. Our goal is to increase the future cash flows of this business over time. If and when we don't have greater opportunities available to us and we have liquidity, we'll be thoughtful around how we return that cash to shareholders. Perfect. All right. Hi. My name is Shai Tambor. I'm an individual investor. You know, I like your slide about your valuation and seen as a compelling investment, and frankly, I felt that way for a couple of years now, and I was very excited when you announced your buyback a year ago with $25 million, but you didn't execute on that. I'm curious, kind of. You know, I mean, I was super excited to see the $100 million buyback, but what took you so long? I mean, the stock has been cheap for a while now, so what has changed? Yeah. I'll get started there. You know, we wanted to have a really thoughtful and well-developed plan around how we're gonna make this business better, right? The thing that you won't get from this team and you won't get from me is rash movements or actions that aren't thought through and make sense, not only in the near term, the medium term and long term. Our commitment is to creating a more valuable business sustainably, and we felt that we wanted to make sure we examine that, we explore that, and we had confidence in our ability to do that over time. We do now. We took a, I think, a fairly aggressive stance around our share repurchase. When we announced it, you know, I think we were trading, market cap was in the $660 range. It was 10%. Over 10%, almost 10% for market cap when we did it. We chose to do $60 million of that. It's accelerated share repurchase. That's happening, all right? Our commitment to doing the right thing for our shareholders, I think is clear, and we're gonna continue to kind of be thoughtful, prudent around that. Our emphasis though over time is how do we make this business more valuable? That's gonna be a big part of the equation going forward. Okay, our next question comes from just on the other side of the city here, from Jeff Stevenson with Loop Capital. He'd like to know what is the current timeline to get to 80% specialty sales, and can you give any more balance between the organic growth and the M&A that it would take to get to that 80% mix? Yeah. Hey, we're focused on that every day. We're working on that. Right now thinking about how we drive more specialty volume, get more access and execute programs in the organization. That's a mantra and a drumbeat that we're hitting, and the RVPs and the GMs and everyone associated with the business and folks on Mike's team are focused on that. We think we can get there in the midterm based on the timing Kelly shared. We're gonna work very hard to try to get that soon to get there sooner. To be clear, our midterm target is organic only. There is no M&A factored into that view. Anything we do acquisitively would be incremental to that goal. We are counting on the things that we can control, the things that are within our purview and the commercial actions we can take, the operational actions we can take, and the performance we can deliver. Okay, second question from Jeff is, can you give more color on the opportunity to grow your business in the home center channel where the pro customer is becoming an increased focus for the top two players? How large could this part of your business grow to in the future? Mike, you wanna- Yeah. It's a real focus for us. If you go back several years, typically the pro customers didn't view retail, particularly The Home Depot and Lowe's, as an option for them for their products. Today, with the focus that both Lowe's and The Home Depot have on that, they're investing in resources in the field, they're investing in equipment to help support that pro customer, a lot of opportunity. I can't speak for what I think that volume would look like over the next few years, but we personally are investing in that piece of the business. Greg and his team have hired resources. As I mentioned, we are in their stores daily, helping them do pull-through, particularly around our specialty products category, and then even helping them think about larger products. As I mentioned in my part of the presentation, we've helped a couple of them land some multifamily projects. We're a great resource for them from our breadth of products and then our service capabilities as well. Thank you. Eric DeLamarter from Half Moon Capital. You'd referenced that 45% of sales currently have an end application in R&R. In your midterm target of 75% specialty, do you have a sense of how much of total sales at that point will be R&R? Yeah. So within our models for that, we really don't have a meaningful change in that end market profile, at this point. You know, we obviously believe that R&R is gonna be a strong driver in general going forward, as we mentioned. At this point, we didn't make a different assumption, as far as end market is concerned. Thank you. Yeah. Hi. Sturgis Woodberry from Occam Crest Management. I'm just curious how big of an acquisition investors should be prepared to see be announced. Would they be smaller tuck-ins, 50, 100, or could it be a multi-hundred-million dollar type acquisition? Yeah. So listen, we are being really thoughtful about looking at the opportunities out there and making sure, again, they fit our filter strategically and for all the criteria that we established, and it's something that we believe we can add value to. We think it's an interesting environment. There's a fair amount of activity, and we're gonna be really thoughtful about it. We like our strategy, and we like the things we're doing, find things that fit and bolt on and move through. But we're always gonna keep an open-minded view and think about how we create value and make sure we have the flexibility to act appropriately and do things that make sense, that we believe make sense, and we have full confidence that we can execute. Anybody else for questions in the room? These are, I guess, modeling questions. You know, when you've talked in the past, I think you've talked about structural gross margins at 9%. Yeah. You bumped it up to 10%. You know Yeah. What was the math around that? What's the thought? Yeah. I think we just have seen, you know, even in, as we've seen, you know, normalized margins, when we've seen the puts and takes in the last few quarters, we just feel more confident that we're executing better around strategic pricing, even within the commodity business, you know. It's not significantly different, but it. We're just executing at a better level. We felt comfortable that 10% felt like a good normalized margin going forward. Okay. I think in the targets you guys had 75%, 25%, but if you go to the 80/20 mix, where does that put your gross margin target? Yeah. I wouldn't be really able to to provide that for you, right off the bat. Thank you though. It'd be higher. It would be. Yeah. Exactly. It definitely would be improved. Okay, great. Thanks. All right. Sam Sheldon with Punch & Associates. Maybe you could just address market share, where you think you are in winning back some market share, and then maybe you just could talk about the ideal environment to win market share as well for BlueLinx. Mike, you want to? Yeah. Look, we from a market share perspective, certainly a lot of upside. Our market share, I mean, we're the largest distributor in the space, so we have decent market share, but there's a lot of upside for us from market share. Particularly when you think about, I'm gonna keep going back to this, to the specialty product expansion opportunity. We have a lot of opportunity to gain market share through our organic growth when I think about millwork, industrials, siding and trim, particularly industrial products. As I tried to reference a little bit earlier, we have pockets where, first of all, we have expertise already in these categories. We have branches that do a really good job in these categories, and then we have others that, typically or in the past have not invested in these categories. We have the expertise, we have the vendor relationships, and now it's just some of the work that Sean and his team are doing to help us model that out and then start to deploy new categories and new locations across our footprint. A lot of upside for market share growth for us, particularly in our specialty category mix. Any other questions in the room? All right. Thank you so much for everybody that's joined us virtually and in the room today. I appreciate the engagement in the Q&A sessions. Great questions. Thank you so much for asking. We have a lunch set up for those in the room that wanna stay and mingle a little bit more. You'll have access to chat with management a little further. Help yourself to the buffet over here. For those on the virtual webcast, thank you so much for being with us today. We appreciate your participation. Now let's close with one more round of applause for our speakers today. That concludes the 2022 BlueLinx Investor Day. Thank you so much.