LP Building Solutions Reports Fourth Quarter and Full Year 2023 Results, and Provides First Quarter and Full Year Outlook for 2024
- Significant increase in net income for Q4 2023 compared to the prior year
- Adjusted EBITDA and diluted EPS also showed growth in Q4 2023
- Decline in net sales for siding but an increase for OSB in Q4 2023
- Full-year 2023 experienced a decrease in net sales and income
- LPX optimistic for 2024 with investments in capacity expansion and positive housing market outlook
- Decline in net sales for siding in full-year 2023
- Significant decrease in net income for full-year 2023 compared to the prior year
- Adjusted EBITDA and diluted EPS showed a significant decline for full-year 2023
Insights
The reported financial results of Louisiana-Pacific Corporation indicate a mixed performance with both declines and increases in various segments. The decrease in siding net sales by 14% in Q4 and 10% for the full year, despite higher prices, suggests a contraction in demand or market share, which could be a concern for investors looking at the company's growth prospects in this segment.
Conversely, the increase in OSB net sales by 6% in Q4 is a positive sign, particularly as this product is a key material in construction and housing markets. However, the full-year 50% decrease in OSB sales reflects a significant downturn, likely due to the broader economic factors affecting the housing market in 2023.
The consolidated net sales decrease and the sharp drop in net income year-over-year highlight challenges faced by the company, potentially due to market saturation, increased competition, or external economic pressures. The substantial decline in Adjusted EBITDA and Adjusted Diluted EPS also underscores profitability concerns.
Regarding capital allocation, the company's investments in capital expenditures and facility assets, alongside returning value to shareholders through dividends, indicate a balanced approach to capital management. The remaining $200 million under the share repurchase program could signal confidence by management in the intrinsic value of the company's stock, potentially providing support for the stock price.
The financial results of Louisiana-Pacific Corporation reveal a complex fiscal landscape. The increase in net income for Q4 is a positive indicator, especially when contrasted with the full-year decrease. The growth in net income per diluted share from Q4 suggests improved profitability on a per-share basis, which is typically a positive signal to investors about the company's earnings quality.
The cash provided by operating activities shows strong cash flow generation, an important factor for financial stability and future investments. The company's liquidity position, with $222 million in cash and cash equivalents and a revolving credit facility providing substantial financial flexibility, is robust and suggests that the company is well-equipped to handle short-term obligations and invest in strategic opportunities.
However, the overall decrease in net sales and the sharp year-over-year decline in net income raise questions about the company's revenue generation and cost management strategies. Investors will be particularly interested in how these financial metrics will influence the company's stock performance and market valuation.
From an economic perspective, the financial results of Louisiana-Pacific Corporation reflect broader economic trends, such as fluctuations in the housing market and material costs. The decrease in siding net sales could be attributed to a slowdown in housing construction or renovations, which in turn could be a response to economic uncertainty or interest rate hikes.
The increase in OSB net sales for Q4, despite a significant annual drop, indicates a potential recovery or stabilization in the housing market towards the end of the year. This could be an early indicator of a rebound in construction activity, which would have wide-reaching implications for related industries and the economy as a whole.
The company's outlook for single-family housing and strategic investments in capacity expansion suggest an anticipation of future market growth. However, it's important to note that economic forecasts are subject to change based on external factors such as fiscal policies, consumer confidence and interest rates.
Key Highlights for the Fourth Quarter of 2023, Compared to the Fourth Quarter of the Prior Year
-
Siding net sales decreased by
14% to$332 million -
Oriented Strand Board (OSB) net sales increased by
6% to$272 million -
Consolidated net sales decreased by
7% to$658 million -
Net income was
$59 million $69 million -
Net income per diluted share was
$0.81 $0.92 -
Adjusted EBITDA(1) was
$129 million $29 million -
Adjusted Diluted EPS(1) was
$0.71 $0.10 -
Cash provided by operating activities was
$159 million
Key Highlights for the Full Year, Compared to Prior Year
-
Siding net sales decreased by
10% to$1.3 billion -
OSB net sales decreased by
50% to$1.0 billion -
Consolidated net sales decreased by
33% to$2.6 billion -
Net income was
$178 million $905 million -
Net income per diluted share was
$2.46 $11.41 -
Adjusted EBITDA(1) was
$478 million $911 million -
Adjusted Diluted EPS(1) was
$3.22 $8.55 -
Cash provided by operating activities was
$316 million
(1) |
This is a non-GAAP financial measure. See “Use of Non-GAAP Information” and “Reconciliation of Net Income to Non-GAAP Adjusted EBITDA, Non-GAAP Adjusted Income, and Non-GAAP Adjusted Diluted EPS" below. |
Capital Allocation Update
-
Paid
$300 million -
Paid
$80 million Wawa, Ontario, Canada in 2023 -
Paid
$69 million -
Declared a quarterly cash dividend of
$0.26 -
Cash and cash equivalents of
$222 million $550 million $770 million -
Availability of
$200 million
“LP finished the quarter and the year with results that reflect increased operational efficiency and an improving outlook for single-family housing,” said LP Chairperson and Chief Executive Officer Brad Southern. “Siding inventory and sell-through patterns remain seasonally normal. As we look forward to 2024 and beyond, LP’s recent investments in mill and prefinishing capacity leave us well positioned for expansion and share gains in Siding and Structural Solutions.”
Q1 and Full Year 2024 Outlook
The Company is providing financial guidance for the first quarter of 2024 and full year 2024 as set forth in the table below. Guidance is based on current plans and expectations and is subject to a number of known and unknown uncertainties and risks, including those set forth below under “Forward-Looking Statements.”
|
First Quarter 2024 |
|
Full Year 2024 |
Siding Net sales year-over-year growth |
|
|
|
Siding Adjusted EBITDA(2) |
|
|
|
OSB Adjusted EBITDA(2)(3) |
|
|
|
Consolidated Adjusted EBITDA(2)(3)(4) |
|
|
|
Capital Expenditures(5) |
|
|
|
(2) |
This is a non-GAAP financial measure. Reconciliation of Siding Adjusted EBITDA, OSB Adjusted EBITDA, and consolidated Adjusted EBITDA guidance to the closest corresponding GAAP measure on a forward-looking basis is not available without unreasonable efforts. Our inability to reconcile these measures results from the inherent difficulty in forecasting generally and quantifying certain projected amounts that are necessary for such reconciliation. In particular, sufficient information is not available to calculate certain adjustments required for such reconciliation, such as business exit charges, product-line discontinuance charges, other operating credits and charges, net, loss on early debt extinguishment, investment income, and other non-operating items, that would be required to be included in the comparable forecasted |
(3) |
For purposes of calculating the full year 2024 OSB Adjusted EBITDA and full year 2024 consolidated Adjusted EBITDA amounts in the table above, the second quarter through the fourth quarter of 2024 Adjusted EBITDA is assumed to be at our cycle average run rate of |
(4) |
For purposes of calculating the fourth quarter of 2024 and full year 2024 consolidated Adjusted EBITDA, LP South America Adjusted EBITDA fully offsets Corporate and Other Adjusted EBITDA. |
(5) |
Capital expenditures related to strategic growth and sustaining maintenance projects are expected to be between |
Fourth Quarter 2023 Highlights
Net sales for the fourth quarter of 2023 decreased year-over-year by
Net income increased year-over-year by
Full Year 2023 Highlights
Net sales for 2023 decreased year-over-year by
Net income decreased year-over-year by
Segment Results
Siding
The Siding segment serves diverse end markets with a broad product offering, including LP® SmartSide® Trim & Siding, LP® SmartSide® ExpertFinish® Trim & Siding, LP BuilderSeries® Lap Siding, and LP® Outdoor Building Solutions™ (collectively referred to as Siding Solutions). The Siding Solutions products consist of a full line of engineered wood siding, trim, soffit, and fascia.
Segment sales and adjusted EBITDA for this segment were as follows (dollar amounts in millions):
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||||
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
||||||
Net sales |
$ |
332 |
|
$ |
386 |
|
(14 |
)% |
|
$ |
1,328 |
|
$ |
1,469 |
|
(10 |
)% |
Adjusted EBITDA |
|
72 |
|
|
88 |
|
(19 |
)% |
|
|
269 |
|
|
339 |
|
(21 |
)% |
|
Quarter Ended December 31, 2023
|
|
Year Ended December 31, 2023
|
||||||||
|
Average Net
|
|
Unit
|
|
Average Net
|
|
Unit
|
||||
Siding Solutions |
1 |
% |
|
(15 |
)% |
|
5 |
% |
|
(14 |
)% |
The effects of list price increase drove year-over-year increases in the average net selling price for the fourth quarter and full year 2023. The volume decreases for the fourth quarter and full year 2023 were driven by record results in the comparable period and challenging new and existing home sales markets in the current period.
Fourth quarter 2023 Adjusted EBITDA decreased year-over-year by
Oriented Strand Board (OSB)
The OSB segment manufactures and distributes OSB structural panel products, including the innovative value-added OSB product portfolio known as LP® Structural Solutions (which includes LP TechShield® Radiant Barrier, LP WeatherLogic® Air & Water Barrier, LP Legacy® Premium Sub-Flooring, LP NovaCore® Thermal Insulated Sheathing, LP FlameBlock® Fire-Rated Sheathing, and LP TopNotch® 350 Durable Sub-Flooring). OSB is manufactured using wood strands arranged in layers and bonded with resins.
Segment sales and adjusted EBITDA for this segment were as follows (dollar amounts in millions):
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||||
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
||||||
Net sales |
$ |
272 |
|
$ |
257 |
|
6 |
% |
|
$ |
1,026 |
|
$ |
2,062 |
|
(50 |
)% |
Adjusted EBITDA |
|
59 |
|
|
13 |
|
362 |
% |
|
|
220 |
|
|
1,034 |
|
(79 |
)% |
|
Quarter Ended December 31, 2023
|
|
Year Ended December 31, 2023
|
||||||||
|
Average Net Selling Price |
|
Unit Shipments |
|
Average Net Selling Price |
|
Unit Shipments |
||||
OSB - Structural Solutions |
(1 |
)% |
|
35 |
% |
|
(41 |
)% |
|
(14 |
)% |
OSB - Commodity |
12 |
% |
|
(25 |
)% |
|
(39 |
)% |
|
(22 |
)% |
Fourth quarter 2023 net sales increased year-over-year
Adjusted EBITDA for fourth quarter of 2023 increased year-over-year by
LPSA
The LPSA segment manufactures and distributes LP OSB structural panel and Siding Solutions products in
Segment sales and adjusted EBITDA for this segment were as follows (dollar amounts in millions):
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||||
|
2023 |
|
2022 |
|
% Change |
|
2023 |
|
2022 |
|
% Change |
||||||
Net sales |
$ |
52 |
|
$ |
51 |
|
3 |
% |
|
$ |
205 |
|
$ |
241 |
|
(15 |
)% |
Adjusted EBITDA |
|
11 |
|
|
12 |
|
(10 |
)% |
|
|
42 |
|
|
77 |
|
(46 |
)% |
|
Quarter Ended December 31, 2023
|
|
Year Ended December 31, 2023
|
||||||||
|
Average Net
|
|
Unit
|
|
Average Net
|
|
Unit
|
||||
OSB - Structural Solutions |
(10 |
)% |
|
15 |
% |
|
(9 |
)% |
|
(9 |
)% |
Siding |
(2 |
)% |
|
12 |
% |
|
7 |
% |
|
(1 |
)% |
LPSA net sales for the fourth quarter of 2023 increased
Adjusted EBITDA for the fourth quarter of 2023 decreased year-over-year by
Conference Call
LP will hold a conference call to discuss this release today at 11 a.m. Eastern Time (8 a.m. Pacific Time). Investors will have the opportunity to listen to the conference call live by going to investor.lpcorp.com. For those who cannot listen to the live broadcast, the recorded webcast and accompanying presentation will be available to the public online in the Past Events section of investor.lpcorp.com.
About LP Building Solutions
As a leader in high-performance building solutions, Louisiana-Pacific Corporation (LP Building Solutions, NYSE: LPX) manufactures engineered wood products that meet the demands of builders, remodelers and homeowners worldwide. LP's extensive portfolio of innovative and dependable products includes Siding Solutions (LP® SmartSide® Trim & Siding, LP® SmartSide® ExpertFinish® Trim & Siding, LP BuilderSeries® Lap Siding and LP® Outdoor Building Solutions™), LP® Structural Solutions (LP® TechShield® Radiant Barrier, LP WeatherLogic® Air & Water Barrier, LP Legacy® Premium Sub-Flooring, LP® FlameBlock® Fire-Rated Sheathing, LP NovaCore® Thermal Insulated Sheathing and LP® TopNotch® 350 Durable Sub-Flooring) and oriented strand board (OSB). In addition to product solutions, LP provides industry-leading customer service and warranties. Since its founding in 1972, LP has been Building a Better World™ by helping customers construct beautiful, durable homes while stockholders build lasting value. Headquartered in
Forward-Looking Statements
This news release contains statements concerning Louisiana-Pacific Corporation's (LP) future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based upon the beliefs and assumptions of, and on information available to, our management; assumptions upon which such forward-looking statements are based are also forward-looking statements. The following statements are or may constitute forward-looking statements: (1) statements preceded by, followed by or that include words like “may,” “will,” “could,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “project,” “target,” “potential,” “continue,” “likely,” or “future” or the negative or other variations thereof and (2) other statements regarding matters that are not historical facts, including without limitation, plans for product development, forecasts of future costs and expenditures, possible outcomes of legal proceedings, capacity expansion, and other growth initiatives, the adequacy of reserves for loss contingencies, and any statements regarding the Company's financial outlook. Factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include, but are not limited to, the following: changes in governmental fiscal and monetary policies, including tariffs and levels of employment; changes in general and global economic conditions, including impacts from global pandemics, rising inflation, supply chain disruptions, and new or ongoing military conflicts including the conflict between
Use of Non-GAAP Information
In evaluating our business, we utilize non-GAAP financial measures that fall within the meaning of SEC Regulation G and Regulation S-K Item 10(e), which we believe provide users of the financial information with additional meaningful comparison to prior reported results. Non-GAAP financial measures do not have standardized definitions and are not defined by
Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS are not substitutes for the
During the year ended December 31, 2023, we updated our definitions of Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS to exclude other business exit charges not classified as discontinued operations. Business exit charges consist of inventory and other asset impairment and exit charges related to the exit of other businesses not individually significant. We consider business exit charges to be outside the performance of our ongoing core business operations and believe that presenting Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS excluding business exit charges provides increased transparency as to the operating costs of our current business performance. We did not revise prior years’ Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS amounts because there were no significant costs similar in nature to these items.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
|||||||||||||||
|
|||||||||||||||
(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE AMOUNTS) |
|||||||||||||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Net sales |
$ |
658 |
|
|
$ |
705 |
|
|
$ |
2,581 |
|
|
$ |
3,854 |
|
Cost of sales |
|
(499 |
) |
|
|
(577 |
) |
|
|
(1,988 |
) |
|
|
(2,355 |
) |
Gross profit |
|
159 |
|
|
|
128 |
|
|
|
593 |
|
|
|
1,498 |
|
Selling, general, and administrative expenses |
|
(66 |
) |
|
|
(68 |
) |
|
|
(257 |
) |
|
|
(264 |
) |
Loss on impairment |
|
(5 |
) |
|
|
— |
|
|
|
(30 |
) |
|
|
(1 |
) |
Other operating credits and charges, net |
|
1 |
|
|
|
(1 |
) |
|
|
(19 |
) |
|
|
16 |
|
Income from operations |
|
89 |
|
|
|
59 |
|
|
|
287 |
|
|
|
1,250 |
|
Interest expense |
|
(5 |
) |
|
|
(2 |
) |
|
|
(14 |
) |
|
|
(11 |
) |
Investment income |
|
8 |
|
|
|
6 |
|
|
|
18 |
|
|
|
14 |
|
Other non-operating items |
|
(26 |
) |
|
|
(86 |
) |
|
|
(43 |
) |
|
|
(97 |
) |
Income (loss) before income taxes |
|
65 |
|
|
|
(23 |
) |
|
|
248 |
|
|
|
1,155 |
|
Provision for income taxes |
|
(7 |
) |
|
|
10 |
|
|
|
(74 |
) |
|
|
(274 |
) |
Equity in unconsolidated affiliate |
|
1 |
|
|
|
— |
|
|
|
3 |
|
|
|
4 |
|
Income (loss) from continuing operations |
|
59 |
|
|
|
(12 |
) |
|
|
178 |
|
|
|
885 |
|
Income from discontinued operations, net of income taxes |
|
— |
|
|
|
2 |
|
|
|
— |
|
|
$ |
198 |
|
Net income (loss) |
$ |
59 |
|
|
$ |
(11 |
) |
|
$ |
178 |
|
|
$ |
1,083 |
|
Net loss attributed to noncontrolling interest |
|
— |
|
|
|
3 |
|
|
|
— |
|
|
|
3 |
|
Net income (loss) attributed to LP |
$ |
59 |
|
|
$ |
(8 |
) |
|
$ |
178 |
|
|
$ |
1,086 |
|
|
|
|
|
|
|
|
|
||||||||
Amounts attributed to LP common shareholders: |
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations, net of income taxes |
$ |
59 |
|
|
$ |
(10 |
) |
|
$ |
178 |
|
|
$ |
888 |
|
Income from discontinued operations, net of income taxes |
|
— |
|
|
|
2 |
|
|
|
— |
|
|
|
198 |
|
|
$ |
59 |
|
|
$ |
(8 |
) |
|
$ |
178 |
|
|
$ |
1,086 |
|
Net income attributed to LP per share of common stock: |
|
|
|
|
|
|
|
||||||||
Income (loss) per share continuing operations - basic |
$ |
0.81 |
|
|
$ |
(0.14 |
) |
|
$ |
2.47 |
|
|
$ |
11.40 |
|
Income per share discontinued operations - basic |
|
— |
|
|
|
0.03 |
|
|
|
— |
|
|
|
2.54 |
|
Net income (loss) per share - basic |
$ |
0.81 |
|
|
$ |
(0.11 |
) |
|
$ |
2.47 |
|
|
$ |
13.94 |
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) per share continuing operations - diluted |
$ |
0.81 |
|
|
$ |
(0.14 |
) |
|
$ |
2.46 |
|
|
$ |
11.34 |
|
Income per share discontinued operations - diluted |
|
— |
|
|
|
0.03 |
|
|
|
— |
|
|
|
2.52 |
|
Net income (loss) per share - diluted |
$ |
0.81 |
|
|
$ |
(0.11 |
) |
|
$ |
2.46 |
|
|
$ |
13.87 |
|
|
|
|
|
|
|
|
|
||||||||
Average shares of common stock used to compute net income per share: |
|
|
|
|
|
|
|
||||||||
Basic |
|
72 |
|
|
|
72 |
|
|
|
72 |
|
|
|
78 |
|
Diluted |
|
72 |
|
|
|
72 |
|
|
|
72 |
|
|
|
78 |
|
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) |
|||||||
|
|||||||
(DOLLAR AMOUNTS IN MILLIONS) |
|||||||
|
December 31, |
||||||
|
2023 |
|
2022 |
||||
ASSETS |
|
|
|
||||
Cash and cash equivalents |
$ |
222 |
|
|
$ |
369 |
|
Receivables |
|
155 |
|
|
|
127 |
|
Inventories |
|
378 |
|
|
|
337 |
|
Prepaid expenses and other current assets |
|
23 |
|
|
|
20 |
|
Total current assets |
|
778 |
|
|
|
854 |
|
|
|
|
|
||||
Timber and timberlands |
|
32 |
|
|
|
40 |
|
Property, plant, and equipment, net |
|
1,540 |
|
|
|
1,326 |
|
Operating lease assets, net |
|
25 |
|
|
|
44 |
|
Goodwill and other intangible assets |
|
27 |
|
|
|
36 |
|
Investments in and advances to affiliates |
|
5 |
|
|
|
6 |
|
Restricted cash |
|
— |
|
|
|
14 |
|
Other assets |
|
20 |
|
|
|
24 |
|
Deferred tax asset |
|
11 |
|
|
|
7 |
|
Total assets |
$ |
2,437 |
|
|
$ |
2,350 |
|
|
|
|
|
||||
LIABILITIES AND EQUITY |
|
|
|
||||
Accounts payable and accrued liabilities |
$ |
254 |
|
|
$ |
317 |
|
Income tax payable |
|
5 |
|
|
|
19 |
|
Total current liabilities |
|
259 |
|
|
|
336 |
|
|
|
|
|
||||
Long-term debt |
|
347 |
|
|
|
346 |
|
Deferred income taxes |
|
162 |
|
|
|
113 |
|
Non-current operating lease liabilities |
|
25 |
|
|
|
41 |
|
Contingency reserves, excluding current portion |
|
25 |
|
|
|
26 |
|
Other long-term liabilities |
|
61 |
|
|
|
53 |
|
Total liabilities |
|
880 |
|
|
|
916 |
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
||||
Common stock |
|
88 |
|
|
|
88 |
|
Additional paid-in capital |
|
465 |
|
|
|
462 |
|
Retained earnings |
|
1,479 |
|
|
|
1,371 |
|
Treasury stock |
|
(386 |
) |
|
|
(388 |
) |
Accumulated comprehensive loss |
|
(89 |
) |
|
|
(99 |
) |
Total stockholders’ equity |
|
1,557 |
|
|
|
1,433 |
|
Total liabilities and stockholders’ equity |
$ |
2,437 |
|
|
$ |
2,350 |
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED) |
|||||||||||||||
|
|||||||||||||||
(DOLLAR AMOUNTS IN MILLIONS) |
|||||||||||||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
59 |
|
|
$ |
(11 |
) |
|
$ |
178 |
|
|
$ |
1,083 |
|
Adjustments to net income: |
|
|
|
|
|
|
|
||||||||
Depreciation and amortization |
|
32 |
|
|
|
33 |
|
|
|
119 |
|
|
|
132 |
|
Impairment of goodwill and long-lived assets |
|
5 |
|
|
|
1 |
|
|
|
30 |
|
|
|
1 |
|
Gain on sale of assets, net |
|
— |
|
|
|
— |
|
|
|
(7 |
) |
|
|
(157 |
) |
Pension (gain) loss due to settlement |
|
(2 |
) |
|
|
78 |
|
|
|
4 |
|
|
|
82 |
|
Deferred taxes |
|
1 |
|
|
|
(26 |
) |
|
|
44 |
|
|
|
1 |
|
Foreign currency remeasurement and transaction (gains) losses |
|
29 |
|
|
|
2 |
|
|
|
50 |
|
|
|
(2 |
) |
Other adjustments, net |
|
(2 |
) |
|
|
1 |
|
|
|
26 |
|
|
|
35 |
|
Changes in assets and liabilities (net of acquisitions and divestitures): |
|
|
|
|
|
|
|
||||||||
Receivables |
|
44 |
|
|
|
42 |
|
|
|
(8 |
) |
|
|
22 |
|
Inventories |
|
— |
|
|
|
6 |
|
|
|
(46 |
) |
|
|
(66 |
) |
Prepaid expenses and other current assets |
|
4 |
|
|
|
4 |
|
|
|
(1 |
) |
|
|
(7 |
) |
Accounts payable and accrued liabilities |
|
(4 |
) |
|
|
(25 |
) |
|
|
(40 |
) |
|
|
15 |
|
Income taxes payable, net of receivables |
|
(7 |
) |
|
|
(65 |
) |
|
|
(33 |
) |
|
|
6 |
|
Net cash provided by operating activities |
|
159 |
|
|
|
41 |
|
|
|
316 |
|
|
|
1,144 |
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
||||||||
Property, plant, and equipment additions |
|
(64 |
) |
|
|
(133 |
) |
|
|
(300 |
) |
|
|
(414 |
) |
Acquisition of facility assets |
|
— |
|
|
|
— |
|
|
|
(80 |
) |
|
|
— |
|
Proceeds from business divestiture |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
268 |
|
Proceeds from sale of assets |
|
— |
|
|
|
3 |
|
|
|
9 |
|
|
|
— |
|
Other investing activities, net |
|
— |
|
|
|
(3 |
) |
|
|
(4 |
) |
|
|
— |
|
Net cash used in investing activities |
|
(64 |
) |
|
|
(132 |
) |
|
|
(376 |
) |
|
|
(146 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
||||||||
Repayment of long-term debt |
|
— |
|
|
|
— |
|
|
|
(80 |
) |
|
|
— |
|
Borrowing of long-term debt |
|
— |
|
|
|
— |
|
|
|
80 |
|
|
|
— |
|
Payment of cash dividends |
|
(17 |
) |
|
|
(16 |
) |
|
|
(69 |
) |
|
|
(69 |
) |
Purchase of stock |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(900 |
) |
Other financing activities |
|
2 |
|
|
|
2 |
|
|
|
(8 |
) |
|
|
(13 |
) |
Net cash used in financing activities |
|
(15 |
) |
|
|
(14 |
) |
|
|
(77 |
) |
|
|
(982 |
) |
EFFECT OF EXCHANGE RATE ON CASH, CASH EQUIVALENTS, AND RESTRICTED CASH |
|
(18 |
) |
|
|
6 |
|
|
|
(24 |
) |
|
|
(5 |
) |
Net increase (decrease) in cash, cash equivalents, and restricted cash |
|
62 |
|
|
|
(99 |
) |
|
|
(161 |
) |
|
|
12 |
|
Cash, cash equivalents, and restricted cash at the beginning of the period |
|
160 |
|
|
|
482 |
|
|
|
383 |
|
|
|
371 |
|
Cash, cash equivalents, and restricted cash at end of period |
$ |
222 |
|
|
$ |
383 |
|
|
$ |
222 |
|
|
$ |
383 |
|
KEY PERFORMANCE INDICATORS
The following tables present summary data relating to: (i) housing starts within
We monitor housing starts, which is a leading external indicator of residential construction in
The following table sets forth housing starts for the quarter and year ended December 31, 2023 and 2022:
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Housing starts1: |
|
|
|
|
|
|
|
Single-Family |
236 |
|
193 |
|
945 |
|
1,005 |
Multi-Family |
98 |
|
134 |
|
469 |
|
547 |
|
334 |
|
327 |
|
1,413 |
|
1,553 |
1Actual |
We monitor sales volumes for our products in our Siding, OSB, and LPSA segments, which we define as the number of units of our products sold within the applicable period. Evaluating sales volume by product type helps us identify and address changes in product demand, broad market factors that may affect our performance, and opportunities for future growth. It should be noted that other companies may present sales volume data differently, and therefore, as presented by us, sales volume data may not be comparable to similarly titled measures reported by other companies. We believe that sales volumes can be a useful measure for evaluating and understanding our business.
The following table sets forth sales volumes for the quarter and year ended December 31, 2023 and 2022:
|
Quarter Ended December 31, 2023 |
|
Quarter Ended December 31, 2022 |
||||||
Sales Volume |
Siding |
OSB |
LPSA |
Total |
Siding |
OSB |
LPSA |
Total |
|
Siding Solutions (MMSF) |
389 |
— |
8 |
397 |
|
456 |
— |
7 |
463 |
OSB - Structural Solutions (MMSF) |
— |
408 |
132 |
540 |
|
— |
303 |
115 |
418 |
OSB - Commodity (MMSF) |
— |
375 |
— |
375 |
|
— |
503 |
— |
503 |
|
|
|
|
|
|
|
|
|
|
|
Year Ended December 31, 2023 |
|
Year Ended December 31, 2022 |
||||||
Sales Volume |
Siding |
OSB |
LPSA |
Total |
Siding |
OSB |
LPSA |
Total |
|
Siding Solutions (MMSF) |
1,547 |
— |
33 |
1,580 |
|
1,797 |
— |
33 |
1,830 |
OSB - Structural Solutions (MMSF) |
— |
1,559 |
502 |
2,061 |
|
— |
1,803 |
554 |
2,357 |
OSB - Commodity (MMSF) |
— |
1,512 |
— |
1,512 |
|
— |
1,944 |
— |
1,944 |
We measure OEE of each of our mills to track improvements in the utilization and productivity of our manufacturing assets. OEE is a composite metric that considers asset uptime (adjusted for capital project downtime and similar events), production rates, and finished product quality. We believe that when used in conjunction with other metrics, OEE can be a useful measure for evaluating our ability to generate profits, and that providing this measure should allow interested persons to monitor operational improvements. We use a best-in-class target across all LP sites that allows us to optimize capital investments, focus maintenance and reliability improvements, and improve overall equipment efficiency. It should be noted that other companies may present OEE data differently, and therefore, as presented by us, OEE data may not be comparable to similarly titled measures reported by other companies.
OEE for the quarter and year ended December 31, 2023 and 2022 for each of our segments is listed below:
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Siding |
77 % |
|
77 % |
|
77 % |
|
76 % |
OSB |
76 % |
|
71 % |
|
75 % |
|
72 % |
LPSA |
79 % |
|
70 % |
|
75 % |
|
71 % |
|
||||||||||||
SELECTED SEGMENT INFORMATION |
||||||||||||
(DOLLAR AMOUNTS IN MILLIONS) |
||||||||||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
|||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||
Net sales |
|
|
|
|
|
|
|
|||||
Siding |
$ |
332 |
|
$ |
386 |
|
$ |
1,328 |
|
$ |
1,469 |
|
OSB |
|
272 |
|
|
257 |
|
|
1,026 |
|
|
2,062 |
|
LPSA |
|
52 |
|
|
51 |
|
|
205 |
|
|
241 |
|
Other |
|
1 |
|
|
12 |
|
|
22 |
|
|
84 |
|
Intersegment sales |
|
— |
|
|
— |
|
|
— |
|
|
(2 |
) |
Total net sales |
$ |
658 |
|
$ |
705 |
|
$ |
2,581 |
|
$ |
3,854 |
|
|
|||||||||||||||
RECONCILIATION OF NET INCOME TO NON-GAAP ADJUSTED EBITDA, NON-GAAP ADJUSTED INCOME, AND |
|||||||||||||||
NON-GAAP ADJUSTED DILUTED EPS |
|||||||||||||||
(DOLLAR AMOUNTS IN MILLIONS EXCEPT PER SHARE AMOUNTS) |
|||||||||||||||
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Net income (loss) |
$ |
59 |
|
|
$ |
(11 |
) |
|
$ |
178 |
|
|
$ |
1,083 |
|
Add (deduct): |
|
|
|
|
|
|
|
||||||||
Net loss attributed to noncontrolling interest |
|
— |
|
|
|
3 |
|
|
|
— |
|
|
|
3 |
|
Income from discontinued operations, net of income taxes |
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
(198 |
) |
Income (loss) attributed to LP from continuing operations |
|
59 |
|
|
|
(10 |
) |
|
|
178 |
|
|
|
888 |
|
Provision (benefit) for income taxes |
|
7 |
|
|
|
(10 |
) |
|
|
74 |
|
|
|
274 |
|
Depreciation and amortization |
|
32 |
|
|
|
34 |
|
|
|
119 |
|
|
|
129 |
|
Stock-based compensation expense |
|
4 |
|
|
|
3 |
|
|
|
13 |
|
|
|
19 |
|
Loss on impairment attributed to LP |
|
5 |
|
|
|
— |
|
|
|
6 |
|
|
|
1 |
|
Other operating credits and charges, net |
|
2 |
|
|
|
1 |
|
|
|
18 |
|
|
|
(16 |
) |
Business exit charges |
|
(3 |
) |
|
|
— |
|
|
|
32 |
|
|
|
— |
|
Interest expense |
|
5 |
|
|
|
2 |
|
|
|
14 |
|
|
|
11 |
|
Investment income |
|
(8 |
) |
|
|
(6 |
) |
|
|
(18 |
) |
|
|
(14 |
) |
Pension settlement charges |
|
(2 |
) |
|
|
78 |
|
|
|
4 |
|
|
|
82 |
|
Other non-operating items, not included above |
|
28 |
|
|
|
8 |
|
|
|
39 |
|
|
|
15 |
|
Adjusted EBITDA |
$ |
129 |
|
|
$ |
100 |
|
|
$ |
478 |
|
|
$ |
1,389 |
|
|
|
|
|
|
|
|
|
||||||||
Siding |
$ |
72 |
|
|
$ |
88 |
|
|
$ |
269 |
|
|
$ |
339 |
|
OSB |
|
59 |
|
|
|
13 |
|
|
|
220 |
|
|
|
1,034 |
|
LPSA |
|
11 |
|
|
|
12 |
|
|
|
42 |
|
|
|
77 |
|
Other |
|
(2 |
) |
|
|
(4 |
) |
|
|
(17 |
) |
|
|
(23 |
) |
Corporate |
|
(10 |
) |
|
|
(9 |
) |
|
|
(36 |
) |
|
|
(38 |
) |
Adjusted EBITDA |
$ |
129 |
|
|
$ |
100 |
|
|
$ |
478 |
|
|
$ |
1,389 |
|
|
Quarter Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
Net income attributed to LP from continuing operations per share - diluted |
$ |
0.81 |
|
|
$ |
(0.14 |
) |
|
$ |
2.46 |
|
|
$ |
11.34 |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
59 |
|
|
$ |
(11 |
) |
|
$ |
178 |
|
|
$ |
1,083 |
|
Add (deduct): |
|
|
|
|
|
|
|
||||||||
Net loss attributed to noncontrolling interest |
|
— |
|
|
|
3 |
|
|
|
— |
|
|
|
3 |
|
Income from discontinued operations, net of income taxes |
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
(198 |
) |
Income (loss) attributed to LP from continuing operations |
|
59 |
|
|
|
(10 |
) |
|
|
178 |
|
|
|
888 |
|
Loss on impairment attributed to LP |
|
5 |
|
|
|
— |
|
|
|
6 |
|
|
|
1 |
|
Other operating credits and charges, net |
|
2 |
|
|
|
1 |
|
|
|
18 |
|
|
|
(16 |
) |
Business exit charges |
|
(3 |
) |
|
|
— |
|
|
|
32 |
|
|
|
— |
|
Pension settlement charges |
|
(2 |
) |
|
|
78 |
|
|
|
4 |
|
|
|
82 |
|
Reported tax provision (benefit) |
|
7 |
|
|
|
(10 |
) |
|
|
74 |
|
|
|
274 |
|
Adjusted income before tax |
|
68 |
|
|
|
59 |
|
|
|
311 |
|
|
|
1,229 |
|
Normalized tax provision at |
|
(17 |
) |
|
|
(15 |
) |
|
|
(78 |
) |
|
|
(307 |
) |
Adjusted Income |
$ |
51 |
|
|
$ |
44 |
|
|
$ |
233 |
|
|
$ |
922 |
|
Diluted shares outstanding |
|
72 |
|
|
|
72 |
|
|
|
72 |
|
|
|
78 |
|
Adjusted Diluted EPS |
$ |
0.71 |
|
|
$ |
0.61 |
|
|
$ |
3.22 |
|
|
$ |
11.77 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240214004077/en/
Investor Contact:
Aaron Howald
615.986.5792
Aaron.Howald@lpcorp.com
Media Contact:
Breeanna Straessle
615.986.5886
Media.Relations@lpcorp.com
Source: Louisiana-Pacific Corporation
FAQ
What was the net income for LPX in Q4 2023?
Did LPX experience any increase in net sales for Q4 2023?
What was the adjusted EBITDA for LPX in Q4 2023?
How did LPX's net income per diluted share change in Q4 2023?
What was the net income for LPX in full-year 2023?
Did LPX experience any decrease in net sales for full-year 2023?
What was the adjusted EBITDA for LPX in full-year 2023?
How did LPX's net income per diluted share change in full-year 2023?
What is LPX's outlook for Q1 2024 and full year 2024?
