FOR IMMEDIATE RELEASE:                                                                            Contact:  Brad Pence         

                       February 2, 2004                                                                             (503) 584-2030

 

HARD WORK AND TOUGH DECISIONS PAY-OFF FOR KEITH BROWN BUILDING MATERIALS

 

            SALEM, OR – In the fall of 2002, combating a soft commodities market, under-capitalization after a major expansion, and poorly performing yard locations, Keith Brown Building Materials implemented a tough business plan to stop its decline, and to bring profitability back to the company. Now, fourteen months later, the company has achieved dramatic improvement and is confident about its future moving forward in an economy that is starting to improve. For the first time in three years, the company produced a year-end net profit as of December 2003.

            In January of 2003, C. J. Murphy, an independent consultant, was hired by the board of directors to implement new operating procedures and direct meetings with the company’s bank, stockholders and vendors to restructure and reduce the company’s debt. “This project has been like repairing a building that has been damaged in an earthquake – you have to tear away all the cracked layers until you get to a solid foundation – only then can you start to rebuild,” Murphy said. “The hard work of our employees, excellent service by our suppliers, partnerships with our bank and the forgiveness of subordinated debt have all helped in making Keith Brown a profitable company once again.”

            Turnaround steps taken this past year included closing eight under-performing lumberyards and selling the Eugene, Oregon, discount building materials outlet.  Reformed collection procedures that began in January 2003 have significantly improved revenue. A concentrated effort was made by all yards this past year to sell slow moving and obsolete merchandise, and by keeping stock levels in check the company has greatly improved inventory management.

 

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Keith Brown Building Materials

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“Personally, it was a very difficult decision for me to make, to cut corporate staff and yard personnel, close a number of our lumberyards, and initiate new business practices, but I knew it had to be done to bring us back to being a profitable building materials supplier able to provide the materials and excellent service our customers demand,” stated Brad Pence, Chief Executive Officer.  “Keith Brown is now poised to be a force in West Coast building materials supply in today’s marketplace. We will continue to work daily on executing our plan for profitability. We are grateful to our customers, vendors, and employees for supporting us in our efforts.”

            Founded in 1928, Keith Brown Building Materials is privately owned and headquartered in Salem, Oregon. Sales in 2003 totaled $47 million, and the company employs 150 people at its 12 locations and corporate office. The company operates lumberyards in Tracy, Oakdale, Empire, Madera, Visalia and Lindsay, California. Its Oregon yards are located in Portland, Molalla, Salem, Corvallis and Medford, and it has a discount building materials outlet in Salem.

 

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