BOISE CASCADE Co

The following tables set forth our operating results in dollars and as a percentage of sales for the three and six months ended June 30, 2026 and 2025:

Sales Volumes and Prices

Set forth below are historical U.S. housing starts data, sales mix and gross margin information for our BMD segment, and segment sales volumes and average net selling prices for the principal products sold by our Wood Products segment for the three and six months ended June 30, 2026 and 2025:

(a) Actual U.S. housing starts as reported by the U.S. Census Bureau.

(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 June 30, 2026, total sales increased $91.2 million, or 5%, to $1,831.3 million from $1,740.1 million during the three months ended June 30, 2025. For the six months ended June 30, 2026, total sales increased $53.3 million, or 2%, to $3,329.9 million from $3,276.6 million for the same period in the prior year. As described below, the change in sales in both periods was driven by the changes in sales prices and volumes for the products we distribute and manufacture, with single-family residential construction activity being the key demand driver for our sales. In second quarter 2026, total U.S. housing starts and single-family housing starts decreased 1% and 4%, respectively, compared with the same period in 2025. On a year-to-date basis through June 2026, total U.S. housing starts were flat, while single-family housing starts decreased 5% compared to the same period in 2025. Average composite lumber prices for the three and six months ended June 30, 2026 were 8% and 2% higher, respectively, than in the same periods in the prior year, as reflected by Random Lengths composite lumber pricing. Average composite panel prices for the three and six months ended June 30, 2026 were 1% and 8% lower, respectively, than in the same periods in the prior year, as reflected by Random Lengths composite panel pricing.

Building Materials Distribution. Sales increased $82.6 million, or 5%, to $1,697.5 million for the three months ended June 30, 2026, from $1,614.9 million for the three months ended June 30, 2025. The overall increase in sales was driven by net sales volume and net sales price increases of 4% and 1%, respectively. By product line, general line product sales increased 9%, or $62.7 million; commodity sales increased 7%, or $38.6 million; and EWP sales (substantially all of which are sourced through our Wood Products segment) decreased 6%, or $18.7 million.

During the six months ended June 30, 2026, sales increased $64.4 million, or 2%, to $3,086.4 million from $3,022.0 million for the same period in the prior year. The overall increase in sales was driven by net sales volume increases of 3%, offset partially by net sales price decreases of 1%. By product line, general line product sales increased 7%, or $87.9 million; commodity sales increased 1%, or $14.6 million; and sales of EWP decreased 6%, or $38.1 million.

Wood Products. Sales, including sales to our BMD segment, increased $12.4 million, or 3%, to $459.6 million for the three months ended June 30, 2026, from $447.2 million for the three months ended June 30, 2025. The increase in sales was driven by higher plywood sales prices and sales volumes of 15% and 3%, respectively, resulting in increased sales of $18.8 million and $4.1 million, respectively. These increases were offset partially by lower sales prices for I-joists and LVL (collectively referred to as EWP) of 7% and 4%, respectively, resulting in decreased sales of $7.5 million and $5.9 million, respectively. Additionally, EWP sales volumes decreased by 2%, resulting in decreased sales of $5.3 million.

For the six months ended June 30, 2026, sales, including sales to our BMD segment, decreased $5.3 million, or 1%, to $857.8 million from $863.1 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 6% and 7%, respectively, resulting in decreased sales of $14.5 million and $14.4 million, respectively. Additionally, sales volumes for I-joists and LVL decreased by 3% and 2%, respectively, resulting in decreased sales of $6.9 million and $4.9 million, respectively. These decreases were offset partially by higher plywood sales prices and sales volumes of 8% and 3%, respectively, resulting in increased sales of $19.7 million and $7.7 million, respectively.

Costs and Expenses

Materials, labor, and other operating expenses (excluding depreciation) increased $62.0 million, or 4%, to $1,503.5 million for the three months ended June 30, 2026, compared with $1,441.5 million during the same period in the prior year. In BMD, the increase in materials, labor, and other operating expenses was driven by increased sales volumes compared with second quarter 2025. Materials, labor, and other operating expenses as a percentage of sales (MLO rate) in our BMD segment increased 20 basis points, driven by lower margin percentages on general line products and EWP, offset partially by higher margin percentages on commodity products. In our Wood Products segment, materials, labor, and other operating expenses decreased primarily due to lower per-unit costs of OSB (used in the manufacture of I-joists) and decreased EWP sales volumes. These decreases were offset partially by higher labor costs compared with second quarter 2025. The MLO rate in our Wood Products segment decreased by 410 basis points, primarily as the result of higher plywood sales prices and sales volumes.

For the six months ended June 30, 2026, materials, labor, and other operating expenses (excluding depreciation) increased $40.9 million, or 2%, to $2,758.5 million, compared with $2,717.6 million in the same period in the prior year. In BMD, the increase in materials, labor, and other operating expenses was driven by increased sales volumes, compared with the first six months of 2025. The BMD segment MLO rate increased 30 basis points, driven by lower margin percentages on general line products and EWP, offset partially by higher margin percentages on commodity products. In our Wood Products segment, materials, labor, and other operating expenses decreased primarily due to lower per-unit costs of OSB and decreased EWP sales volumes. Additionally, reduced purchases of external veneer for our Alexandria EWP mill contributed to the decrease in MLO, as operations resumed at our Oakdale veneer and plywood mill following planned downtime to complete significant mill modernization projects in 2025. These decreases were offset partially by higher labor costs compared with the first six months of 2025. The MLO rate in our Wood Products segment decreased by 140 basis points, primarily as the result of higher plywood sales prices and sales volumes.

Depreciation and amortization expense increased $5.3 million, or 14%, to $42.7 million for the three months ended June 30, 2026, compared with $37.4 million during the same period in the prior year. For the six months ended June 30, 2026, these expenses increased $7.2 million, or 10%, to $81.8 million, compared with $74.5 million in the same period in the prior year. The increase in both periods was primarily due to recent investments in support of our EWP capabilities in our Wood Products segment, as well as organic growth and a fourth quarter 2025 acquisition in our BMD segment.

Selling and distribution expenses increased $12.0 million, or 7%, to $173.8 million for the three months ended June 30, 2026, compared with $161.8 million during the same period in the prior year. The increase was due primarily to higher shipping and handling costs of $6.2 million, as well as higher employee-related expenses of $5.6 million. For the six months ended June 30, 2026, selling and distribution expenses increased $18.8 million, or 6%, to $324.2 million, compared with $305.5 million during the same period in 2025. The increase was primarily a result of higher employee-related expenses of $10.5 million, as well as higher shipping and handling costs of $8.5 million.

General and administrative expenses increased $0.8 million, or 3%, to $27.3 million for the three months ended June 30, 2026, compared with $26.5 million for the same period in the prior year. For the six months ended June 30, 2026, general and administrative expenses increased $2.1 million, or 4%, to $53.6 million, compared with $51.5 million during the same period in 2025. The increase in both periods was due primarily to higher employee-related expenses and incentive compensation expense.

For the three and six months ended June 30, 2025, other (income) expense, net was $7.6 million and $7.5 million of income, respectively. For both periods, the income primarily relates to gains on the sale of non-operating properties in our Wood Products and BMD segments.

Income From Operations

Income from operations increased $3.4 million to $84.0 million for the three months ended June 30, 2026, compared with $80.5 million for the three months ended June 30, 2025. Income from operations decreased $23.3 million to $111.8 million for the six months ended June 30, 2026, compared with $135.0 million for the six months ended June 30, 2025.

Building Materials Distribution. Segment income decreased $7.9 million to $70.1 million for the three months ended June 30, 2026, from $78.0 million for the three months ended June 30, 2025. The decrease in segment income was driven by increased selling and distribution expenses and depreciation and amortization expense of $10.8 million and $1.7 million, respectively. Additionally, segment income in second quarter 2025 benefited from a $3.8 million gain on the sale of a non-operating property. These decreases in segment income were offset partially by a gross margin increase of $9.2 million, resulting from higher gross margins on commodity and general line products, which were offset partially by lower gross margins on EWP.

For the six months ended June 30, 2026, segment income decreased $23.4 million to $103.1 million from $126.5 million for the six months ended June 30, 2025. The decrease in segment income was driven by increased selling and distribution expenses and depreciation and amortization expense of $19.0 million and $2.6 million, respectively. Additionally, segment income in the six months ended June 30, 2025 benefited from a $3.8 million gain on the sale of a non-operating property. These decreases in segment income were offset partially by a gross margin increase of $2.8 million, resulting from higher gross margins on commodity and general line products, which were offset partially by lower gross margins on EWP.

Wood Products. Segment income increased $11.7 million to $25.7 million for the three months ended June 30, 2026, from $14.0 million for the three months ended June 30, 2025. The increase in segment income was primarily due to higher plywood sales prices and sales volumes, as well as lower per-unit OSB costs. These increases in segment income were offset partially by lower EWP sales prices and higher per-unit conversion costs. Additionally, segment income in second quarter 2025 benefited from a $3.9 million gain on the sale of a non-operating property.

For the six months ended June 30, 2026, segment income increased $2.5 million to $34.1 million from $31.7 million for the six months ended June 30, 2025. The increase in segment income was primarily due to higher plywood sales prices and sales volumes, as well as lower per-unit OSB costs. These increases in segment income were offset partially by lower EWP sales prices and higher per-unit conversion costs. Additionally, segment income in the six months ended June 30, 2025 benefited from a $3.9 million gain on the sale of a non-operating property.

Corporate. Unallocated corporate expenses increased $0.3 million to $11.8 million for the three months ended June 30, 2026, from $11.5 million for the same period in the prior year. The increase was primarily due to higher incentive compensation expense and other employee-related expenses. For the six months ended June 30, 2026, unallocated corporate expenses increased $2.4 million to $25.4 million from $23.1 million for the six months ended June 30, 2025. The increase was primarily due to the absorption of approximately $1.8 million of estimated insurance losses related to a fire at our Florien veneer and plywood facility in first quarter 2026, in accordance with our self-insured risk retention program.

Other

Interest Income. Interest income decreased $2.5 million to $2.2 million for the three months ended June 30, 2026, from $4.6 million for the same period in the prior year. For the six months ended June 30, 2026, interest income decreased $5.0 million to $5.1 million from $10.1 million for the six months ended June 30, 2025. The decrease in both periods was due primarily to lower average balances of cash equivalents, as well as lower interest rates.

Income Tax Provision

For the three and six months ended June 30, 2026, we recorded $21.2 million and $27.8 million, respectively, of income tax expense and had an effective tax rate of 27.0% in both periods. For the three and six months ended June 30, 2025, we recorded $18.6 million and $32.5 million, respectively, of income tax expense and had an effective tax rate of 23.1% and 24.1%, 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.