BOISE CASCADE Co

The following tables set forth our operating results in dollars and as a percentage of sales for the three and nine months ended September 30, 2025 and 2024:

Sales Volumes and Prices

Set forth below are historical U.S. housing starts data, segment sales volumes and average net selling prices for the principal products sold by our Wood Products segment, and sales mix and gross margin information for our BMD segment for the three and nine months ended September 30, 2025 and 2024:

(a) U.S. housing starts for the three and nine months ended September 30, 2025 have yet to be published. Therefore, the data presented is for the two and eight months ended August 31, 2025. The three and nine months ended September 30, 2024 represent actual U.S. housing starts as reported by the U.S. Census Bureau. For the two months ended August 31, 2024 single-family, multi-family, and total U.S. housing starts (in thousands) were approximately 170.4, 66.7, and 237.1, respectively. For the eight months ended August 31, 2024 single-family, multi-family, and total U.S. housing starts (in thousands) were 692.6, 236.1, and 928.7, respectively.

(b) We define gross margin as "Sales" less "Materials, labor, and other operating expenses (excluding depreciation)." Substantially all costs included in "Materials, labor, and other operating expenses (excluding depreciation)" for our BMD segment are for inventory purchased for resale. Gross margin percentage is gross margin as a percentage of segment sales.

Sales

For the three months ended September 30, 2025, total sales decreased $45.9 million, or 3%, to $1,667.8 million from $1,713.7 million during the three months ended September 30, 2024. For the nine months ended September 30, 2025, total sales decreased $212.4 million, or 4%, to $4,944.4 million from $5,156.8 million for the same period in the prior year. As described below, the decrease in sales in both periods was driven by the changes in sales prices and volumes for the products we manufacture and distribute, with single-family residential construction activity being the key demand driver of our sales. When comparing July 2025 and August 2025 housing starts to the same periods in 2024, total U.S. housing starts increased 2%, while single-family housing starts decreased 3%. On a year-to-date basis through August 2025, total U.S. housing starts increased 1%, while single-family housing starts decreased 5%, compared to the same period in 2024. Average composite panel prices for the three and nine months ended September 30, 2025 were 14% and 15% lower, respectively, than in the same periods in the prior year, as reflected by Random Lengths composite panel pricing. Average composite lumber prices for the three and nine months ended September 30, 2025 were 7% and 13% higher, respectively, than in the same periods in the prior year, as reflected by Random Lengths composite lumber pricing.

Wood Products. Sales, including sales to our BMD segment, decreased $57.5 million, or 13%, to $396.4 million for the three months ended September 30, 2025, from $453.9 million for the three months ended September 30, 2024. The decrease in sales was driven by lower sales prices for LVL and I-joists (collectively referred to as EWP) of 13% and 12%, respectively, resulting in decreased sales of $16.5 million and $12.6 million, respectively. Additionally, sales volumes for I-joists and LVL decreased by 10% and 7%, respectively, resulting in decreased sales of $10.9 million and $9.4 million, respectively. In addition, lower plywood sales prices and sales volumes contributed $4.5 million to the sales decrease during the period.

For the nine months ended September 30, 2025, sales, including sales to our BMD segment, decreased $153.2 million, or 11%, to $1,259.5 million from $1,412.6 million for the same period in the prior year. The decrease in sales was driven by lower sales prices for LVL and I-joists of 11% and 10%, respectively, resulting in decreased sales of $44.5 million and $32.6 million, respectively. Additionally, sales volumes for I-joists and LVL decreased 6% and 1%, respectively, resulting in decreased sales of $21.3 million and $3.3 million, respectively. Plywood sales prices and sales volumes decreased 6% and 3%, respectively, resulting in decreased sales of $23.9 million and $14.3 million, respectively. Plywood sales volumes were impacted by planned downtime to complete projects at our Oakdale plywood mill.

For both periods described above, EWP sales volumes were influenced by multiple factors, including the level of housing starts, competition from other wood-based products, and concrete floor applications that limit wood floor opportunity for I-joists.

Building Materials Distribution. Sales decreased $11.3 million, or 1%, to $1,556.2 million for the three months ended September 30, 2025, from $1,567.5 million for the three months ended September 30, 2024. Compared with the same quarter in the prior year, the overall decrease in sales was driven by a sales price decrease of 1%, as sales volumes were flat. By product line, commodity sales decreased 3%, or $16.2 million; general line product sales increased 6%, or $41.7 million; and EWP sales (substantially all of which are sourced through our Wood Products segment) decreased 11%, or $36.8 million.

During the nine months ended September 30, 2025, sales decreased $149.5 million, or 3%, to $4,578.2 million from $4,727.7 million for the same period in the prior year. The overall decrease in sales was driven by sales price and sales volume decreases of 2% and 1%, respectively. By product line, commodity sales decreased 5%, or $79.3 million; general line product sales increased 3%, or $55.7 million; and sales of EWP decreased 12%, or $125.9 million.

Costs and Expenses

Materials, labor, and other operating expenses (excluding depreciation) increased $28.6 million, or 2%, to $1,404.3 million for the three months ended September 30, 2025, compared with $1,375.7 million during the same period in the prior year. In our Wood Products segment, materials, labor, and other operating expenses increased due to higher labor and other manufacturing costs. These increases were offset partially by decreased sales volumes for EWP, as well as lower costs of OSB

(used in the manufacture of I-joists) and decreased purchases of externally produced veneer compared with third quarter 2024. Materials, labor, and other operating expenses as a percentage of sales (MLO rate) in our Wood Products segment increased by 1,330 basis points, primarily as the result of lower EWP sales prices and volumes, which resulted in decreased leveraging of manufacturing costs. In BMD, the decrease in materials, labor, and other operating expenses was driven by lower purchased materials costs as a result of a decline in sales compared with third quarter 2024. The BMD segment MLO rate increased 60 basis points, driven by lower margin percentages on commodity and EWP products.

For the nine months ended September 30, 2025, materials, labor, and other operating expenses (excluding depreciation) decreased $1.9 million, or less than 1%, to $4,122.0 million, compared with $4,123.8 million in the same period in the prior year. In our Wood Products segment, materials, labor, and other operating expenses increased due to higher labor and other manufacturing costs, as well as increased purchases of externally produced veneer for our Alexandria EWP mill as a result of downtime during the first half of 2025 to complete the modernization projects at our Oakdale veneer and plywood mill. These increases were offset partially by decreased sales volumes of I-joists and plywood, as well as lower costs of OSB compared with the same period in the prior year. The MLO rate in our Wood Products segment increased by 1,190 basis points, due primarily to lower sales prices and sales volumes for both EWP and plywood, which resulted in decreased leveraging of manufacturing costs. In BMD, the decrease in materials, labor, and other operating expenses was driven by lower purchased materials costs as a result of a decline in sales, as well as increased vendor rebates and allowances, compared with the first nine months of 2024. The BMD segment MLO rate increased 10 basis points, primarily due to lower margin percentages on our commodity sales, offset partially by higher margins on our general line sales compared with the first nine months of 2024.

Depreciation and amortization expense increased $5.5 million, or 15%, to $42.4 million for the three months ended September 30, 2025, compared with $36.9 million during the same period in the prior year. For the nine months ended September 30, 2025, these expenses increased $9.8 million, or 9%, to $116.9 million, compared with $107.1 million in the same period in the prior year. The increase in both periods was primarily due to purchases of property and equipment, including the recent investments at our Oakdale veneer and plywood mill. For the nine months ended September 30, 2025, the increase was offset partially by $2.2 million of accelerated depreciation recorded in first quarter 2024 for the indefinite curtailment of lumber production at our Chapman, Alabama facility.

Selling and distribution expenses increased $7.6 million, or 5%, to $165.1 million for the three months ended September 30, 2025, compared with $157.5 million during the same period in the prior year. The increase was due to higher occupancy costs, shipping and handling, professional fees and services, and information technology related costs of $6.0 million. Additionally, employee-related expenses increased $3.6 million, offset partially by a decrease in incentive compensation expense of $3.0 million. For the nine months ended September 30, 2025, selling and distribution expenses increased $19.1 million, or 4%, to $470.5 million, compared with $451.4 million during the same period in 2024. The increase was primarily a result of higher professional fees and services, shipping and handling, occupancy costs, and information technology related costs of $9.2 million. In addition, employee-related expenses increased $13.6 million, offset partially by lower incentive compensation expense of $6.3 million.

General and administrative expenses decreased $0.4 million, or 2%, to $25.8 million for the three months ended September 30, 2025, compared with $26.2 million for the same period in the prior year. For both the nine months ended September 30, 2025 and 2024 general and administrative expenses were $77.2 million. For both periods, lower incentive compensation expenses were offset partially by an increase in professional fees.

For the three months ended September 30, 2025, other (income) expense, net was $2.0 million of income, primarily resulting from a settlement gain associated with a fire at our BMD Phoenix location in second quarter 2021. For the nine months ended September 30, 2025, other (income) expense, net was $9.6 million of income, primarily related to gains on the sale of non-operating properties in our Wood Products and BMD segments in second quarter 2025, as well as the settlement gain discussed above.

Income From Operations

Income from operations decreased $85.0 million to $32.3 million for the three months ended September 30, 2025, compared with $117.4 million for the three months ended September 30, 2024. Income from operations decreased $229.9 million to $167.4 million for the nine months ended September 30, 2025, compared with $397.3 million for the nine months ended September 30, 2024.

Wood Products. For the three months ended September 30, 2025, segment loss was $12.1 million, compared with segment income of $53.9 million for the three months ended September 30, 2024. The decrease in segment income was due to lower EWP and plywood sales prices and sales volumes, as well as higher per-unit conversion costs.

For the nine months ended September 30, 2025, segment income decreased $178.2 million to $19.6 million from $197.9 million for the nine months ended September 30, 2024. The decrease in segment income was due to lower EWP and plywood sales prices and sales volumes, as well as higher per-unit conversion costs. These decreases in segment income were offset partially by a $3.9 million gain on the sale of a non-operating property in second quarter 2025.

Building Materials Distribution. Segment income decreased $20.5 million to $54.3 million for the three months ended September 30, 2025, from $74.8 million for the three months ended September 30, 2024. The decrease in segment income was driven by a gross margin decrease of $10.6 million, resulting primarily from decreased margins on commodity and EWP products, offset partially by increased margins on general line products. Additionally, selling and distribution expenses and depreciation and amortization expense increased $7.8 million and $2.6 million, respectively.

For the nine months ended September 30, 2025, segment income decreased $51.9 million to $180.7 million from $232.7 million for the nine months ended September 30, 2024. The decrease in segment income was driven by a gross margin decrease of $27.6 million, resulting primarily from lower sales volumes and decreased margins on commodity and EWP products, offset partially by increased margins on general line products. In addition, selling and distribution expenses and depreciation and amortization expense increased $19.5 million and $7.9 million, respectively. Segment income benefited from a $3.8 million gain on the sale of a non-operating property in second quarter 2025.

Corporate. Unallocated corporate expenses decreased $1.4 million to $9.9 million for the three months ended September 30, 2025, from $11.3 million for the same period in the prior year. For the nine months ended September 30, 2025, unallocated corporate expenses decreased $0.2 million to $33.0 million from $33.2 million for the nine months ended September 30, 2024. The decrease in both periods was primarily due to a $1.9 million settlement gain and lower incentive compensation expense, offset partially by an increase in professional fees and employee-related expenses.

Other

Interest Income. Interest income decreased $6.0 million to $4.2 million for the three months ended September 30, 2025, from $10.2 million for the same period in the prior year. For the nine months ended September 30, 2025, interest income decreased $17.0 million to $14.3 million from $31.3 million for the nine months ended September 30, 2024. The decrease in both periods was due primarily to lower average balances of cash equivalents, as well as lower interest rates.

Change in fair value of interest rate swaps. For information related to our interest rate swap, which expired in June 2025, see the discussion under "Interest Rate Risk and Interest Rate Swap" of Note 2, Summary of Significant Accounting Policies, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Income Tax Provision

For the three and nine months ended September 30, 2025, we recorded $9.1 million and $41.5 million, respectively, of income tax expense and had an effective rate of 29.5% and 25.1%, respectively. For the three and nine months ended September 30, 2024, we recorded $29.8 million and $101.1 million, respectively, of income tax expense and had an effective rate of 24.7% and 24.8%, respectively. For all periods, the primary reason for the difference between the federal statutory income tax rate of 21% and the effective tax rate was the effect of state taxes. In addition, our effective tax rate during the three months ended September 30, 2025 was adversely impacted by the effect of permanent tax differences on decreased pre-tax book income for 2025.