PART I - FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) The company presents its unaudited condensed consolidated financial statements for the three and six months ended June 30, 2025 and 2024 Q2 & H1 2025 vs 2024 Financial Highlights (in millions, except per share data) | Financial Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net Sales** | $755 | $814 | $1,478 | $1,539 | | **Gross Profit** | $178 | $263 | $375 | $477 | | **Net Income** | $54 | $160 | $145 | $267 | | **Diluted EPS** | $0.77 | $2.23 | $2.07 | $3.71 | Balance Sheet Summary (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $895 | $855 | | **Total Assets** | $2,656 | $2,569 | | **Total Current Liabilities** | $315 | $299 | | **Total Liabilities** | $914 | $899 | | **Total Stockholders' Equity** | $1,742 | $1,671 | Cash Flow Summary for Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | $226 | $317 | | **Net Cash used in Investing Activities** | $(132) | $(61) | | **Net Cash used in Financing Activities** | $(105) | $(157) | | **Net (Decrease) Increase in Cash** | $(7) | $95 | [Notes to the Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes on key accounting policies and events supporting the financial statements Revenue by Segment (in millions) | Segment | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Siding | $460 | $415 | $862 | $776 | | OSB | $250 | $351 | $517 | $664 | | LPSA | $43 | $46 | $95 | $93 | | **Total Net Sales** | **$755** | **$814** | **$1,478** | **$1,539** | - In Q2 2025, the company recorded **$17 million in non-cash, pre-tax impairment charges** related to underutilized equipment and a facility closure[63](index=63&type=chunk) Adjusted EBITDA by Segment (in millions) | Segment | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Siding | $125 | $105 | $230 | $195 | | OSB | $19 | $125 | $73 | $215 | | LPSA | $9 | $10 | $21 | $20 | | **Total Adjusted EBITDA** | **$142** | **$229** | **$304** | **$411** | - In March 2025, the company amended its credit agreement, **increasing the credit facility from $550 million to $750 million** and extending the maturity to March 2032[47](index=47&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses the company's financial condition, operational results, market trends, and segment performance - Demand for building products was mixed in H1 2025, with **single-family housing starts decreasing by 7%** while **multi-family housing starts increased by 17%**[80](index=80&type=chunk)[93](index=93&type=chunk) - The company estimates it could incur approximately **$12 million in incremental costs in 2025** due to new or increased tariffs, primarily impacting the Siding segment[82](index=82&type=chunk) Sales Volume (in Million Square Feet - MMSF) | Product Line | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Siding Solutions | 505 | 465 | 950 | 876 | | OSB - Structural Solutions | 578 | 588 | 1,127 | 1,161 | | OSB - commodity | 430 | 415 | 856 | 830 | [Results of Operations](index=27&type=section&id=Results%20of%20Operations) This section details the financial performance of the Siding, OSB, and LPSA operating segments for Q2 and H1 2025 versus 2024 - The Siding segment's net sales **grew 11% YoY for both Q2 and H1 2025**, driven by an 8% increase in unit shipments and a 2% price increase in Q2[98](index=98&type=chunk)[99](index=99&type=chunk) - The OSB segment's net sales **fell 29% YoY in Q2 2025**, primarily due to a significant drop in average net selling prices for both Structural Solutions (-27%) and commodity OSB (-33%)[101](index=101&type=chunk) - The LPSA segment's net sales **decreased by 7% in Q2 2025** compared to Q2 2024, mainly due to lower OSB prices[104](index=104&type=chunk) - Selling, general, and administrative (SG&A) expenses **increased to $79 million in Q2 2025** from $71 million in Q2 2024, primarily due to higher employee compensation[107](index=107&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=Liquidity%20and%20Capital%20Resources) The company's financial liquidity, cash flows, capital allocation strategy, and credit facilities are detailed - Cash provided by operations **decreased to $226 million in H1 2025** from $317 million in H1 2024, primarily due to lower net income and changes in working capital[113](index=113&type=chunk) - Capital expenditures are **expected to be approximately $350 million in 2025**, a significant increase from the $132 million spent in H1 2025[115](index=115&type=chunk)[114](index=114&type=chunk) - In H1 2025, the company used **$105 million in financing activities**, which included $61 million for share repurchases and $39 million for dividend payments[116](index=116&type=chunk) - As of June 30, 2025, there were **no outstanding borrowings** under the amended $750 million credit facility, and the company was in compliance with all financial covenants[119](index=119&type=chunk)[120](index=120&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=32&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company's exposure to market risks such as foreign currency, commodity price, and interest rate fluctuations is discussed - The company is exposed to foreign currency risk, primarily from the U.S. dollar's fluctuation against the **Canadian dollar, Brazilian real, and Chilean peso**[127](index=127&type=chunk) - The most significant commodity price risk is related to **OSB**, as sales prices fluctuate based on market factors beyond the company's control[128](index=128&type=chunk) - Interest rate risk is present due to a variable rate credit facility, but as of June 30, 2025, there were **no outstanding borrowings**, mitigating this risk[129](index=129&type=chunk) [Item 4. Controls and Procedures](index=33&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Management confirms the effectiveness of disclosure controls and procedures with no material changes to internal controls - Based on an evaluation as of June 30, 2025, the CEO and CFO concluded that the company's **disclosure controls and procedures were effective**[130](index=130&type=chunk) - **No material changes** occurred in the company's internal control over financial reporting during the quarter ended June 30, 2025[131](index=131&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=34&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section references Note 12 for information on the company's legal and environmental matters - Information regarding legal and environmental matters is incorporated by reference from **"Note 12. Commitments and Contingencies"** in the financial statements[133](index=133&type=chunk) [Item 1A. Risk Factors](index=34&type=section&id=ITEM%201A.%20RISK%20FACTORS) No material changes to risk factors disclosed in the 2024 Annual Report on Form 10-K are reported - There have been **no material changes** to the risk factors disclosed in the company's 2024 Annual Report on Form 10-K[134](index=134&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This section updates the status of the company's share repurchase program and remaining authorization - The company **did not repurchase any of its common stock** during the quarter ended June 30, 2025[136](index=136&type=chunk) - As of June 30, 2025, an aggregate of **$177 million of repurchase authorization remained** under the 2024 Share Repurchase Program[136](index=136&type=chunk)

Financial Data and Key Metrics Changes - The company reported siding revenue growth of 11% year-over-year, resulting in $755 million in sales and $142 million in EBITDA for the quarter [7][19] - Adjusted earnings per share for the quarter were $0.99, reflecting strong operational efficiency [7][19] - Operating cash flow was $162 million, supported by seasonal reductions in working capital [18] Business Line Data and Key Metrics Changes - The Siding segment achieved record volume, revenue, and EBITDA despite a challenging market, with a 2% price increase and an 8% volume increase contributing to revenue growth [13][19] - The OSB segment faced significant challenges due to falling commodity prices, resulting in an EBITDA of $19 million, which was better than expected due to cost control measures [16][20] Market Data and Key Metrics Changes - Housing starts remain below long-term average demand levels, contributing to a cautious sentiment among contractors [6] - Current OSB prices are at multiyear lows, with adjusted prices being the lowest in at least twenty years when accounting for inflation [19][20] Company Strategy and Development Direction - The company is focused on maintaining growth in the Siding segment through product innovation and market share gains, particularly with the SmartSide product line [9][19] - The company plans to invest in new siding press capacity and increased prefinishing capabilities to support growth [18] - Cost control measures are being emphasized in the OSB segment to navigate the current market challenges [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential of the Siding segment, despite current market challenges [9][19] - The outlook for the OSB segment remains cautious, with expectations of negative EBITDA in the upcoming quarters if current pricing trends continue [20] Other Important Information - The company was recognized for its safety culture, being named the safest company in 2024 by APA for the third consecutive year [10] - The company has $1.1 billion in liquidity, including $333 million in cash, positioning it well for future investments [18] Q&A Session Summary Question: Insights on Siding margin decrement in Q3 - Management acknowledged that Q3 might not reach the peak of Q2, but combined revenue growth for Q2 and Q3 is expected to be healthy at about 7% year-over-year [26] Question: Early trends in Q3 and CapEx implications - Management noted a slight weakening in the Q3 order file but maintained guidance for the quarter, with most CapEx reductions occurring in the OSB segment [30][29] Question: Cost control measures in OSB - Management highlighted outstanding operational efficiency and aggressive cost containment as key drivers for better-than-expected EBITDA in the OSB segment [38] Question: Impact of shrinking home sizes on siding - Management believes that despite shrinking home sizes, the low penetration rate of wood strand-based siding and potential for a residing cycle will offset any negative impacts [40] Question: Siding guidance for the back half of the year - Management indicated a seasonal pattern with expectations for healthy volume growth in Q4, despite a flat outlook for Q3 [44] Question: Operating rates in Q2 - Operating rates were in the mid-eighty percent range for OSB and slightly lower for Siding as new capacity ramps up [46] Question: Sell-through and channel inventories for Siding - Management reported good sell-through in Q2, with channel inventories positioned as expected, supporting confidence in growth for Q4 [52] Question: Mix impact on pricing - Management clarified that the pricing dynamics are more influenced by product mix rather than headwinds, with panels being lower-priced but high-margin products [70] Question: New residential market opportunities - Management sees opportunities for growth in the new residential market, particularly in converting from vinyl to engineered wood siding [85] Question: Manufactured housing and shed demand - Management noted that shed demand has returned to normal levels post-COVID, while manufactured housing presents a significant growth opportunity due to affordability challenges [94]

Financial Data and Key Metrics Changes - The company reported siding revenue growth of 11% year-over-year, resulting in $755 million in sales and $142 million in EBITDA for the quarter [6][10][15] - Adjusted earnings per share for the quarter were $0.99, despite a negative impact of $102 million from lower OSB prices [6][10] - Operating cash flow was $162 million, supported by $142 million of EBITDA and seasonal reductions in working capital [15] Business Segment Data and Key Metrics Changes - The Siding segment achieved record volume, revenue, and EBITDA, with an EBITDA margin of 27% [6][12] - OSB segment EBITDA was $19 million, outperforming guidance due to exceptional cost control measures [14][15] - Siding OEE reached 78%, while OSB OEE hit 79%, indicating improved operational efficiency [6][10] Market Data and Key Metrics Changes - U.S. housing starts remain below long-term average demand levels, contributing to falling commodity OSB prices [5][14] - The demand environment for OSB is described as unusually difficult, with prices at multiyear lows [17][18] - The company anticipates a flat volume for Siding in Q3 compared to the previous year, with a slight price increase expected [17] Company Strategy and Development Direction - The company aims to capture market share through its SmartSide product, which is expected to outperform other siding substrates [7][19] - Continued investment in sales and marketing is planned to drive growth, particularly in the Siding segment [76][78] - The company is focused on cost containment and operational efficiency in the OSB segment to navigate the current market challenges [14][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential of the Siding segment despite current market challenges [7][19] - The company is prepared to manage capacity and costs in response to fluctuating demand and pricing in the OSB market [14][18] - Management noted that while the demand environment is weakening, the Siding segment's growth driven by material conversion and product innovation remains strong [19] Other Important Information - The company was recognized as the safest company in 2024 by APA, marking the third consecutive year of this honor [8][9] - The company has $1.1 billion in liquidity, including $333 million in cash, positioning it well for future investments [15] Q&A Session Summary Question: Insights on Siding margin decrement in Q3 - Management indicated that Q3 might not reach the peak of Q2, suggesting a balanced approach to revenue and a cautious outlook on EBITDA [24][26] Question: Early trends in Q3 and CapEx implications - Management noted a strong carryover from Q1 into Q2 but observed some weakening in the order file as the quarter progressed [30] Question: Cost control measures in OSB - Management highlighted outstanding operational efficiency and aggressive cost containment as key drivers for better-than-expected EBITDA in OSB [38][39] Question: Impact of shrinking home sizes on Siding - Management acknowledged that while shrinking home sizes present a slight headwind, the overall market share opportunities in repair and remodel will outweigh this factor [40][41] Question: Siding guidance for the back half of the year - Management expects healthy volume growth in Q4, with a seasonal pattern indicating a shift between Q2 and Q3 [44] Question: OSB operating rates and production strategy - Management reported mid-eighty percent operating rates for OSB and emphasized matching production with demand to avoid inventory buildup [45][47] Question: Siding sell-through and channel inventories - Management expressed confidence in good sell-through in Q2 and reasonable channel inventories, supporting growth expectations for the fourth quarter [51][52] Question: Competitive dynamics in new residential market - Management noted opportunities for market share gains among smaller and medium-sized builders, despite exclusivity agreements with larger peers [100][102]

Financial Performance - Q2 2025 vs Q2 2024 - Net sales decreased by 7% from $814 million to $755 million[14, 34] - Adjusted EBITDA decreased by $(87) million from $229 million to $142 million[14, 35] - Adjusted EPS decreased by $(1.10) from $2.09 to $0.99[14, 36] Segment Performance - Siding - Siding Solutions sales increased by 11%[14] - Siding net sales increased from $415 million to $460 million[22, 37] - Siding adjusted EBITDA increased from $105 million to $125 million[21, 37] Segment Performance - OSB - OSB price impact decreased by $(102) million[14] - OSB net sales decreased from $351 million to $250 million, a (30)% decrease[25, 37] - OSB adjusted EBITDA decreased from $125 million to $19 million[25, 37] Cash Flow - Operating cash flow decreased from $212 million to $162 million[14, 27] - Capital expenditures increased from $36 million to $68 million[14, 27] - The company returned $19 million to shareholders[14] 2025 Guidance - Siding revenue is expected to be approximately $430 million in Q3 2025, representing approximately 3% growth[28] - Full year siding revenue is projected to be approximately $1.7 billion, representing approximately 9% growth[28] - Full year total LP adjusted EBITDA is expected to be approximately $405 million[28]

Core Viewpoint - Louisiana-Pacific (LPX) reported quarterly earnings of $0.99 per share, exceeding the Zacks Consensus Estimate of $0.97 per share, but down from $2.09 per share a year ago, indicating a significant decline in profitability [1][2] Financial Performance - The company achieved revenues of $755 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 5.34%, although this is a decrease from $814 million in the same quarter last year [2] - Over the last four quarters, Louisiana-Pacific has consistently surpassed consensus EPS estimates [2] Stock Performance and Outlook - Louisiana-Pacific shares have declined approximately 8.3% year-to-date, contrasting with the S&P 500's gain of 7.1% [3] - The company's earnings outlook is uncertain, with current consensus EPS estimates at $0.95 for the upcoming quarter and $3.79 for the current fiscal year [7] Industry Context - The Building Products - Wood industry, to which Louisiana-Pacific belongs, is currently ranked in the bottom 9% of over 250 Zacks industries, suggesting a challenging environment for stock performance [8]

Q2 2025 Earnings Overview [Key Financial & Operational Highlights](index=1&type=section&id=Key%20Highlights%20for%20Second%20Quarter%202025) LP Building Solutions reported a decrease in consolidated net sales and net income for Q2 2025 compared to Q2 2024, primarily due to challenges in the OSB market, despite strong growth in the Siding segment Key Financial Highlights (Q2 2025 vs. Q2 2024) ($ Millions): | Metric | Q2 2025 | Q2 2024 | Change | | :-------------------------- | :------ | :------ | :----- | | Siding Net Sales | $460 | $415 | +$45 (11%) | | OSB Net Sales | $250 | $351 | -$101 | | Consolidated Net Sales | $755 | $815 | -$60 | | Net Income | $54 | $160 | -$106 | | Net Income per Diluted Share | $0.77 | $2.23 | -$1.46 | | Adjusted EBITDA | $142 | $228 | -$86 | | Adjusted Diluted EPS | $0.99 | $2.09 | -$1.10 | - Cash provided by operating activities was **$162 million** in Q2 2025[2](index=2&type=chunk) [Capital Allocation](index=1&type=section&id=Capital%20Allocation%20Update) LP invested $68 million in capital expenditures and paid $19 million in cash dividends during Q2 2025, while maintaining strong liquidity. A quarterly cash dividend of $0.28 per share was announced - Invested **$68 million** in capital expenditures during Q2 2025[3](index=3&type=chunk) - Paid **$19 million** in cash dividends during Q2 2025[3](index=3&type=chunk) - Announced a quarterly cash dividend of **$0.28 per share** payable on August 29, 2025[3](index=3&type=chunk) - Total liquidity was **$1.1 billion** as of June 30, 2025[3](index=3&type=chunk) Outlook [Financial Guidance](index=2&type=section&id=Financial%20Guidance) LP provided financial guidance for the third quarter and full year 2025, projecting continued growth in Siding net sales and Adjusted EBITDA, while anticipating negative Adjusted EBITDA for OSB due to market conditions Financial Guidance (Third Quarter 2025) ($ Millions): | Metric | Value | | :-------------------------------- | :-------------------- | | Siding Net Sales Year-Over-Year Growth | ~$430 (~3% growth) | | Siding Adjusted EBITDA | ~$110 (~26% margin) | | OSB Adjusted EBITDA | ~$(45) | | Consolidated Adjusted EBITDA | ~$65 | Financial Guidance (Full Year 2025) ($ Millions): | Metric | Value | | :-------------------------------- | :-------------------- | | Siding Net Sales Year-Over-Year Growth | ~$1.7B (~9% growth) | | Siding Adjusted EBITDA | ~$430 (~25% margin) | | OSB Adjusted EBITDA | ~$(25) | | Consolidated Adjusted EBITDA | ~$405 | | Capital Expenditures | ~$350 | - Full year 2025 capital expenditures are expected to be approximately **$180 million** for strategic growth and **$170 million** for sustaining maintenance projects[6](index=6&type=chunk) Detailed Financial Review [Second Quarter 2025 Performance](index=2&type=section&id=Second%20Quarter%202025%20Highlights) Consolidated net sales decreased by $60 million to $755 million, primarily due to a $101 million decline in OSB revenue driven by lower prices. Siding revenue, however, increased by $45 million (11%) due to higher volumes and prices. Net income decreased significantly by $106 million to $54 million, impacted by lower Adjusted EBITDA, asset impairments, and reorganization costs - Consolidated net sales decreased by **$60 million** to **$755 million** compared to the prior-year period[7](index=7&type=chunk) - Siding revenue increased by **$45 million (11%)**, driven by **8% higher volumes** and **2% higher prices**[7](index=7&type=chunk) - OSB revenue decreased by **$101 million**, primarily due to a decline in prices[7](index=7&type=chunk) - Net income decreased year-over-year by **$106 million** to **$54 million** (**$0.77 per diluted share**), reflecting an **$86 million decrease in Adjusted EBITDA**, **$17 million in asset impairments**, and **$3 million in reorganization costs**[8](index=8&type=chunk) [First Six Months of 2025 Performance](index=2&type=section&id=First%20Six%20Months%20of%202025%20Highlights) For the first six months of 2025, consolidated net sales decreased by $60 million to $1.5 billion. Siding revenue grew by $86 million (11%), while OSB revenue declined by $147 million due to lower prices and volumes. Net income decreased by $123 million to $145 million, mainly reflecting a $106 million decrease in Adjusted EBITDA and impairment charges - Consolidated net sales for the first six months of 2025 decreased year-over-year by **$60 million** to **$1.5 billion**[9](index=9&type=chunk) - Siding revenue increased by **$86 million (11%)**, due to **9% higher volumes** and **2% higher prices**[9](index=9&type=chunk) - OSB revenue decreased by **$147 million**, driven by lower prices and a slight decline in volumes[9](index=9&type=chunk) - Net income decreased year-over-year by **$123 million** to **$145 million** (**$2.07 per diluted share**), primarily reflecting a **$106 million decrease in Adjusted EBITDA**, **$17 million of impairment charges**, and **$5 million in reorganization costs**[10](index=10&type=chunk) Segment Performance Analysis [Siding Segment](index=2&type=section&id=Siding) The Siding segment demonstrated strong growth, with net sales increasing by 11% for both the three and six months ended June 30, 2025, driven by higher sales volumes and selling prices. Adjusted EBITDA also saw significant increases, despite strategic investments and tariff expenses Siding Segment Performance (Three Months Ended June 30) ($ Millions): | Metric | 2025 | 2024 | % Change | | :---------------- | :----- | :----- | :------- | | Net sales | $460 | $415 | 11 % | | Adjusted EBITDA | $125 | $105 | 19 % | | Average Net Selling Price | | | 2 % | | Unit Shipments | | | 8 % | Siding Segment Performance (Six Months Ended June 30) ($ Millions): | Metric | 2025 | 2024 | % Change | | :---------------- | :----- | :----- | :------- | | Net sales | $862 | $776 | 11 % | | Adjusted EBITDA | $230 | $195 | 18 % | | Average Net Selling Price | | | 2 % | | Unit Shipments | | | 9 % | - ExpertFinish net sales increased by **17%** for the three months and **20%** for the six months ended June 30, 2025[12](index=12&type=chunk) [OSB Segment](index=3&type=section&id=OSB) The OSB segment experienced significant declines in both net sales and Adjusted EBITDA for the three and six months ended June 30, 2025, primarily due to lower OSB prices OSB Segment Performance (Three Months Ended June 30) ($ Millions): | Metric | 2025 | 2024 | % Change | | :------------------------------------ | :----- | :----- | :------- | | Net sales | $250 | $351 | (29)% | | Adjusted EBITDA | $19 | $125 | (85)% | | OSB - Structural Solutions Average Net Selling Price | | | (27)% | | OSB - commodity Average Net Selling Price | | | (33)% | OSB Segment Performance (Six Months Ended June 30) ($ Millions): | Metric | 2025 | 2024 | % Change | | :------------------------------------ | :----- | :----- | :------- | | Net sales | $517 | $664 | (22)% | | Adjusted EBITDA | $73 | $215 | (66)% | | OSB - Structural Solutions Average Net Selling Price | | | (19)% | | OSB - commodity Average Net Selling Price | | | (23)% | - Decreases in net sales and Adjusted EBITDA were primarily driven by **lower OSB prices**[14](index=14&type=chunk)[15](index=15&type=chunk) [LPSA Segment](index=3&type=section&id=LPSA) The LPSA segment saw a slight decline in Q2 2025 net sales and Adjusted EBITDA due to lower OSB prices. However, for the first six months of 2025, net sales and Adjusted EBITDA increased, driven by higher Siding volume and prices, partially offset by lower OSB prices LPSA Segment Performance (Three Months Ended June 30) ($ Millions): | Metric | 2025 | 2024 | % Change | | :---------------- | :----- | :----- | :------- | | Net sales | $43 | $46 | (7)% | | Adjusted EBITDA | $9 | $10 | (13)% | LPSA Segment Performance (Six Months Ended June 30) ($ Millions): | Metric | 2025 | 2024 | % Change | | :---------------- | :----- | :----- | :------- | | Net sales | $95 | $93 | 2 % | | Adjusted EBITDA | $21 | $20 | 4 % | - The Q2 decline was primarily due to **lower OSB prices**[17](index=17&type=chunk) - The YTD increase was driven by **higher Siding volume and prices**, partially offset by **lower OSB prices**[18](index=18&type=chunk) Company Information & Disclosures [Conference Call Details](index=4&type=section&id=Conference%20Call) LP held a conference call on August 6, 2025, at 11 a.m. ET to discuss the Q2 2025 results. A recorded webcast and presentation are available on the investor relations website - Conference call held on August 6, 2025, at **11 a.m. Eastern Time**[19](index=19&type=chunk) - Recorded webcast and accompanying presentation are available at investor.lpcorp.com[19](index=19&type=chunk) [About LP Building Solutions](index=4&type=section&id=About%20LP%20Building%20Solutions) Louisiana-Pacific Corporation (LP Building Solutions) is a leading manufacturer of high-performance engineered wood products, including Siding Solutions, Structural Solutions, and Oriented Strand Board. Founded in 1972 and headquartered in Nashville, Tennessee, LP operates over 20 manufacturing facilities globally - LP manufactures engineered wood products for builders, remodelers, and homeowners worldwide[20](index=20&type=chunk) - Product portfolio includes Siding Solutions, LP Structural Solutions, and LP Oriented Strand Board[20](index=20&type=chunk) - Founded in **1972**, headquartered in Nashville, Tennessee, operating over **20 manufacturing facilities** across the U.S., Canada, Chile, and Brazil[20](index=20&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This section outlines that the news release contains forward-looking statements subject to various risks and uncertainties, including changes in economic conditions, commodity prices, interest rates, and regulatory policies. LP disclaims any obligation to update these statements - The news release contains forward-looking statements based on management's beliefs and assumptions[21](index=21&type=chunk) - Factors that could cause actual results to differ materially include changes in governmental policies, economic conditions, commodity prices, capital costs, housing market activity, competition, raw material costs, energy and transportation costs, and geopolitical conflicts[21](index=21&type=chunk)[22](index=22&type=chunk) - LP undertakes no obligation to update any forward-looking statements to reflect new information, subsequent events, or circumstances, except as required by law[23](index=23&type=chunk) [Use of Non-GAAP Information](index=5&type=section&id=Use%20of%20Non-GAAP%20Information) LP uses non-GAAP financial measures like Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS to provide additional insights into performance, believing they offer meaningful comparisons. These measures are not defined by U.S. GAAP and may not be comparable to similarly titled measures from other companies - Non-GAAP financial measures (Adjusted EBITDA, Adjusted Income, Adjusted Diluted EPS) are used to provide additional meaningful comparison to prior reported results[24](index=24&type=chunk) - Adjusted EBITDA excludes items such as interest expense, income taxes, depreciation, amortization, stock-based compensation, and impairment losses[24](index=24&type=chunk) - These non-GAAP measures are not substitutes for U.S. GAAP measures and may not be comparable to similarly titled measures reported by other companies[25](index=25&type=chunk)[26](index=26&type=chunk) Consolidated Financial Statements [Condensed Consolidated Statements of Income](index=7&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME%20(UNAUDITED)) The condensed consolidated statements of income show a significant year-over-year decline in net sales, gross profit, and net income for both the three and six months ended June 30, 2025, primarily driven by increased cost of sales and impairment losses Condensed Consolidated Statements of Income (Amounts in Millions, Except Per Share Amounts): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net sales | $755 | $814 | $1,478 | $1,539 | | Gross profit | $178 | $263 | $375 | $477 | | Income from operations | $80 | $194 | $200 | $339 | | Net income | $54 | $160 | $145 | $267 | | Diluted EPS | $0.77 | $2.23 | $2.07 | $3.71 | - Loss on impairment was **$17 million** for both the three and six months ended June 30, 2025[27](index=27&type=chunk) [Condensed Consolidated Balance Sheet](index=8&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEET%20(UNAUDITED)) As of June 30, 2025, LP's total assets increased slightly to $2,656 million compared to December 31, 2024, with an increase in current assets, property, plant, and equipment. Total liabilities also increased, while stockholders' equity grew to $1,742 million Condensed Consolidated Balance Sheet (Amounts in Millions): | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :-------------- | :---------------- | | Total current assets | $895 | $855 | | Property, plant, and equipment, net | $1,639 | $1,592 | | Total assets | $2,656 | $2,569 | | Total current liabilities | $315 | $299 | | Long-term debt | $348 | $348 | | Total liabilities | $914 | $899 | | Total stockholders' equity | $1,742 | $1,671 | [Condensed Consolidated Statements of Cash Flow](index=9&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOW%20(UNAUDITED)) Cash provided by operating activities decreased for both the three and six months ended June 30, 2025, compared to the prior year. Investing activities saw a significant increase in property, plant, and equipment additions, leading to higher net cash used in investing. Financing activities also used less cash due to reduced stock repurchases Condensed Consolidated Statements of Cash Flow (Amounts in Millions) - Three Months Ended June 30: | Metric | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Net cash provided by operating activities | $162 | $212 | | Net cash used in investing activities | $(68) | $(20) | | Net cash used in financing activities | $(17) | $(118) | | Cash, cash equivalents, and restricted cash at end of period | $333 | $317 | Condensed Consolidated Statements of Cash Flow (Amounts in Millions) - Six Months Ended June 30: | Metric | 2025 | 2024 | | :-------------------------------- | :----- | :----- | | Net cash provided by operating activities | $226 | $317 | | Net cash used in investing activities | $(132) | $(61) | | Net cash used in financing activities | $(105) | $(157) | | Cash, cash equivalents, and restricted cash at end of period | $333 | $317 | - Property, plant, and equipment additions increased significantly to **$68 million** in Q2 2025 (from $36 million in Q2 2024) and **$132 million** YTD 2025 (from $77 million YTD 2024)[29](index=29&type=chunk) Key Performance Indicators [Housing Starts](index=10&type=section&id=Housing%20starts) U.S. housing starts, particularly single-family, showed a slight decrease for both the three and six months ended June 30, 2025, compared to the prior year, while multi-family starts increased Housing Starts (in thousands): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :---------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Single-Family | 257 | 281 | 486 | 522 | | Multi-Family | 109 | 89 | 198 | 169 | | Total | 367 | 370 | 684 | 692 | - Housing starts are a leading external indicator of residential construction in the United States that correlates with the demand for many of LP's products[31](index=31&type=chunk) [Sales Volumes](index=10&type=section&id=Sales%20Volume) Siding Solutions sales volumes increased for both the three and six months ended June 30, 2025. OSB Structural Solutions volumes slightly decreased, while OSB commodity volumes increased for both periods Sales Volume (in MMSF) - Three Months Ended June 30: | Sales Volume | Siding | OSB | LPSA | Total | | :---------------------- | :----- | :---- | :--- | :---- | | Siding Solutions (2025) | 498 | — | 7 | 505 | | Siding Solutions (2024) | 459 | — | 6 | 465 | | OSB - Structural Solutions (2025) | — | 450 | 128 | 578 | | OSB - Structural Solutions (2024) | — | 452 | 136 | 588 | | OSB - commodity (2025) | — | 430 | — | 430 | | OSB - commodity (2024) | — | 415 | — | 415 | Sales Volume (in MMSF) - Six Months Ended June 30: | Sales Volume | Siding | OSB | LPSA | Total | | :---------------------- | :----- | :---- | :--- | :---- | | Siding Solutions (2025) | 932 | — | 19 | 950 | | Siding Solutions (2024) | 858 | — | 18 | 876 | | OSB - Structural Solutions (2025) | — | 848 | 279 | 1,127 | | OSB - Structural Solutions (2024) | — | 895 | 266 | 1,161 | | OSB - commodity (2025) | — | 856 | — | 856 | | OSB - commodity (2024) | — | 830 | — | 830 | [Overall Equipment Effectiveness (OEE)](index=11&type=section&id=Overall%20Equipment%20Effectiveness%20(OEE)) OEE for the Siding and OSB segments showed slight improvements in Q2 2025 compared to Q2 2024, while LPSA's OEE decreased. Year-to-date OEE remained stable for Siding and OSB, but declined for LPSA OEE by Segment: | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Siding | 78 % | 77 % | 78 % | 78 % | | OSB | 79 % | 78 % | 77 % | 78 % | | LPSA | 70 % | 76 % | 68 % | 76 % | - OEE is a composite metric that considers asset uptime, production rates, and finished product quality to track improvements in manufacturing asset utilization and productivity[34](index=34&type=chunk) Selected Segment Sales Data [Net Sales by Business Segment](index=12&type=section&id=Net%20Sales%20by%20Business%20Segment) This section provides a consolidated view of net sales by business segment, reinforcing the trends observed in the detailed segment results, with Siding sales increasing and OSB sales decreasing Net Sales by Business Segment (Amounts in Millions): | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Siding | $460 | $415 | $862 | $776 | | OSB | $250 | $351 | $517 | $664 | | LPSA | $43 | $46 | $95 | $93 | | Other | $2 | $2 | $4 | $5 | | Total Sales | $755 | $814 | $1,478 | $1,539 | Non-GAAP Reconciliations [Reconciliation of Non-GAAP Measures](index=13&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Non-GAAP%20Adjusted%20EBITDA,%20Non-GAAP%20Adjusted%20Income,%20and%20Non-GAAP%20Adjusted%20Diluted%20EPS) This section provides detailed reconciliations of net income to non-GAAP Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS for both the three and six months ended June 30, 2025 and 2024, showing the adjustments made from GAAP figures Reconciliation of Net Income to Adjusted EBITDA (Amounts in Millions): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $54 | $160 | $145 | $267 | | Provision for income taxes | $19 | $53 | $45 | $94 | | Depreciation and amortization | $36 | $31 | $70 | $62 | | Loss on impairment | $17 | — | $17 | — | | Adjusted EBITDA | $142 | $229 | $304 | $411 | Segment Adjusted EBITDA (Amounts in Millions): | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Siding | $125 | $105 | $230 | $195 | | OSB | $19 | $125 | $73 | $215 | | LPSA | $9 | $10 | $21 | $20 | | Other | $(10) | $(11) | $(20) | $(19) | | Total Adjusted EBITDA | $142 | $229 | $304 | $411 | Reconciliation of Net Income to Adjusted Income and Adjusted Diluted EPS (Amounts in Millions, except per share): | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $54 | $160 | $145 | $267 | | Loss on impairment | $17 | — | $17 | — | | Reported tax provision | $19 | $53 | $45 | $94 | | Adjusted Income | $69 | $150 | $158 | $261 | | Adjusted Diluted EPS | $0.99 | $2.09 | $2.26 | $3.62 |

Company Performance - Louisiana-Pacific (LPX) closed at $88.56, with a daily increase of 1.4%, outperforming the S&P 500's gain of 0.54% [1] - Over the past month, LPX's stock has risen by 0.94%, which is below the Construction sector's gain of 4.35% and the S&P 500's gain of 4.2% [1] Upcoming Earnings - The upcoming earnings report for Louisiana-Pacific is scheduled for August 6, 2025, with projected EPS of $1.03, indicating a 50.72% decline from the same quarter last year [2] - The Zacks Consensus Estimate for revenue is $727.7 million, reflecting a 10.6% decrease from the previous year [2] Annual Forecast - For the entire year, the Zacks Consensus Estimates predict earnings of $4.08 per share and revenue of $2.82 billion, representing declines of 30.61% and 4.03%, respectively, compared to the previous year [3] Analyst Estimates - Recent modifications to analyst estimates for Louisiana-Pacific indicate changing near-term business trends, with upward revisions suggesting analysts' positive outlook on the company's operations [4] Zacks Rank - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), currently ranks Louisiana-Pacific at 5 (Strong Sell), with a consensus EPS projection that has decreased by 6.85% in the past 30 days [6] Valuation Metrics - Louisiana-Pacific has a Forward P/E ratio of 21.41, which is lower than the industry average Forward P/E of 28.8 [7] - The company has a PEG ratio of 1.39, compared to the Building Products - Wood industry's average PEG ratio of 2.59 [7] Industry Context - The Building Products - Wood industry, part of the Construction sector, holds a Zacks Industry Rank of 229, placing it in the bottom 8% of over 250 industries [8]

Company Performance - Louisiana-Pacific (LPX) stock closed at $92.91, reflecting a -3.7% change from the previous day's closing price, underperforming the S&P 500, which had a daily loss of 0.33% [1] - Over the past month, LPX shares gained 6.65%, outperforming the Construction sector's gain of 5.56% and the S&P 500's gain of 4.07% [1] Earnings Estimates - Louisiana-Pacific is expected to release earnings on August 6, 2025, with a predicted EPS of $1.06, indicating a 49.28% decline compared to the same quarter last year [2] - The consensus estimate for revenue is $747.25 million, reflecting an 8.2% decrease from the same quarter last year [2] Full Year Projections - For the full year, Zacks Consensus Estimates project earnings of $4.17 per share and revenue of $2.93 billion, representing changes of -29.08% and -0.49% from the prior year, respectively [3] - Recent analyst estimate revisions indicate evolving short-term business trends, with positive revisions reflecting optimism about business and profitability [3][4] Zacks Rank and Valuation - Louisiana-Pacific currently holds a Zacks Rank of 4 (Sell), with a consensus EPS projection moving 4.74% lower in the past 30 days [5] - The company is trading at a Forward P/E ratio of 23.12, which is a discount compared to the industry average Forward P/E of 29.32 [6] - LPX has a PEG ratio of 1.5, compared to the Building Products - Wood industry's average PEG ratio of 2.71 [6] Industry Context - The Building Products - Wood industry, part of the Construction sector, has a Zacks Industry Rank of 205, placing it in the bottom 18% of all industries [7] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [7]

Company Performance - Louisiana-Pacific (LPX) shares decreased by 2.5% to $89.48, underperforming the S&P 500's daily loss of 0.79% [1] - Over the past month, LPX shares appreciated by 0.07%, lagging behind the Construction sector's gain of 5.56% and the S&P 500's gain of 5.22% [1] Earnings Projections - The upcoming EPS for Louisiana-Pacific is projected at $1.08, indicating a 48.33% decline compared to the same quarter last year [2] - The Zacks Consensus Estimate for revenue is $747.25 million, down 8.2% from the previous year [2] - For the full year, analysts expect earnings of $4.24 per share and revenue of $2.93 billion, reflecting changes of -27.89% and -0.49% respectively from last year [3] Analyst Estimates and Rankings - Recent changes in analyst estimates for Louisiana-Pacific are crucial as they reflect short-term business dynamics [4] - The Zacks Rank system, which incorporates estimate changes, currently ranks Louisiana-Pacific at 3 (Hold) [6] - Over the past month, there has been a 3.31% decline in the Zacks Consensus EPS estimate [6] Valuation Metrics - Louisiana-Pacific is trading at a Forward P/E ratio of 21.67, which is lower than the industry average Forward P/E of 28.22 [7] - The company has a PEG ratio of 1.41, compared to the Building Products - Wood industry's average PEG ratio of 2.49 [7] Industry Overview - The Building Products - Wood industry is part of the Construction sector and holds a Zacks Industry Rank of 90, placing it in the top 37% of over 250 industries [8] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [8]

Group 1 - Louisiana-Pacific (LPX) is primarily a manufacturing business focused on building materials, which may appear unremarkable at first glance [1] - Warren Buffett holds approximately 8% of LPX through Berkshire Hathaway, indicating a level of confidence in the company's potential [1] - The company has received minimal media attention despite its significant backing and potential investment opportunities [1] Group 2 - The author identifies as a German value investor, emphasizing a strategy of investing in companies with a high margin of safety and below intrinsic value [1] - The investment portfolio is concentrated, typically consisting of 8-12 companies, with a preference for small, underfollowed public companies [1] - A contrarian view is presented, suggesting that risk and return can be inversely correlated, leading to larger bets when the risk/reward ratio is favorable [1]