Financial Performance - For the three months ended March 31, 2025, net income was $91 million, down from $108 million in the same period in 2024, representing a decrease of approximately 15.7%[83] - Adjusted EBITDA for the same period was $162 million, compared to $182 million in 2024, reflecting a decline of about 11%[83] - Cash provided by operations decreased to $64 million in Q1 2025 from $105 million in Q1 2024, primarily due to lower net income and changes in working capital[105] - Selling, general, and administrative expenses increased to $75 million in Q1 2025, up from $69 million in Q1 2024, driven by higher employee compensation and marketing expenses[99] - The company recognized an estimated tax provision of $26 million in Q1 2025, down from $41 million in Q1 2024[100] Segment Performance - Siding segment Adjusted EBITDA increased to $106 million in Q1 2025 from $90 million in Q1 2024, marking a growth of approximately 17.8%[83] - Siding segment net sales increased by 11% to $402 million in Q1 2025, with Adjusted EBITDA rising 17% to $106 million[92] - OSB segment net sales decreased by 15% to $267 million in Q1 2025, with Adjusted EBITDA falling 40% to $54 million[94] - LPSA segment net sales grew by 11% to $52 million in Q1 2025, with Adjusted EBITDA increasing 22% to $12 million[97] Market Trends - Single-family housing starts decreased by 5.4% to 228,000 units in Q1 2025 from 241,000 units in Q1 2024, while multi-family housing starts increased by 11.3% to 89,000 units[87] - Total sales volume for Siding Solutions increased to 445 million square feet (MMSF) in Q1 2025 from 411 MMSF in Q1 2024, an increase of about 8.3%[88] - OSB - Structural Solutions sales volume decreased to 549 MMSF in Q1 2025 from 573 MMSF in Q1 2024, a decline of approximately 4.2%[88] - Average net selling prices for Siding Solutions rose by 2%, while unit shipments increased by 9% in Q1 2025 compared to Q1 2024[93] - OSB - Structural Solutions experienced a 9% decline in average net selling prices and a 10% drop in unit shipments in Q1 2025[94] Operational Challenges - The company continues to face challenges related to material prices, supply disruptions, and labor issues, impacting overall financial performance[73] - The company estimates incremental costs of approximately $12 million in 2025 due to new or increased tariffs, primarily affecting the Siding segment[74] - Overall Equipment Effectiveness (OEE) for the Siding segment was 76% in Q1 2025, down from 78% in Q1 2024[90] Financial Position and Credit Facilities - Capital expenditures in 2025 are expected to be approximately $410 million, funded through cash on hand and operations[107] - The Amended Credit Agreement increased the credit facility from $550 million to $750 million, with no outstanding borrowings as of March 31, 2025[111] - As of March 31, 2025, there were no outstanding borrowings under the company's Amended Credit Facility, indicating no current exposure to interest rate changes[120] Currency and Commodity Exposure - The company has transactional foreign currency exposures primarily related to the U.S. dollar against the Canadian dollar, Brazilian real, Chilean peso, and Argentine peso[118] - The company has translation exposure from converting foreign subsidiary financial statements into U.S. dollars[118] - The most significant commodity product sold by the company is OSB, with no material changes to production capacity or price sensitivity disclosed[119] - The company has historically not engaged in currency rate hedges for operational exposure but may do so in the future[118] - The company has little control over the sales prices of its commodity products, which fluctuate daily based on market factors[119] - The company currently has no derivative or hedging arrangements related to interest rate changes[120]

Financial Data and Key Metrics Changes - Net sales for Q1 2025 were $724 million, flat compared to the prior year, as 11% growth in Siding offset lower OSB prices [8][9] - EBITDA decreased by $20 million, primarily due to lower OSB prices impacting overall performance [9][20] - The Siding business achieved a 26% EBITDA margin in Q1, with expectations for similar performance in Q2 [10][22] Business Line Data and Key Metrics Changes - Siding revenue grew by 11% due to 9% higher volumes and 2% higher prices, outperforming single-family starts by 15 points [16] - OSB revenue and EBITDA were negatively impacted by lower commodity prices, resulting in a $32 million reduction in revenue and $13 million in EBITDA [20] - The Expert Finish product line set records for both volume and revenue in Q1, contributing positively to the overall Siding growth [18][86] Market Data and Key Metrics Changes - Single-family starts fell by 6% in Q1 due to economic volatility and unfavorable weather conditions [7] - The Siding order file remains robust, with expectations for a record second quarter [8][22] - Tariff impacts on EBITDA were approximately $2 million for Siding in Q1, with an anticipated $12 million impact for the full year if current tariffs persist [12][23] Company Strategy and Development Direction - The company is focused on expanding its Siding business and introducing specialized products to drive growth and margin expansion [10][14] - There is a strategic emphasis on product innovation and market share gains, particularly in the repair and remodel sector [50][56] - The company maintains a strong liquidity position with $1 billion available, allowing for flexibility in operations and potential tariff impacts [14][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the Siding business despite macroeconomic challenges, noting strong order files and growth potential [15][24] - The company anticipates year-over-year revenue growth of 9% to 10% for Siding, with EBITDA margins around 26% [22][23] - Management remains cautious about OSB pricing and market dynamics, indicating a conservative approach to forecasting [22][66] Other Important Information - The company has expanded its revolving credit facility to $750 million, which remains undrawn [21] - New product launches, such as the Naturals Collection, have received positive customer feedback and are expected to contribute to future growth [11][52] Q&A Session Summary Question: Key drivers for Siding outperformance - Management noted strength across the entire order file, particularly in shed orders and the R&R sector, contributing to strong performance [26][28] Question: Inventory levels in the channel - Management indicated that home center inventories were normalizing, with seasonal levels appropriate for the spring [30][32] Question: Siding margin progression - Management expects some margin expansion in the second half of the year, with no significant inflationary impacts materializing [40][41] Question: OSB capacity and market dynamics - Management remains bullish on OSB long-term but acknowledges current market pressures due to excess capacity and weak demand [45][46] Question: Marketing investments and order file success - Management highlighted ongoing investments in marketing and product development as key drivers for order file strength [50][52] Question: Impact of competitor mergers on market share - Management expressed confidence in their market position and ongoing efforts to gain share, regardless of competitor activities [87][100] Question: Future growth in new residential market share - Management indicated a focus on gaining market share with larger builders, with growth expected to be incremental and program-based [108][111]

Financial Data and Key Metrics Changes - Net sales for Q1 2025 were $724 million, flat compared to the prior year, with an 11% growth in Siding offsetting lower OSB prices [7][20] - EBITDA decreased by $20 million, primarily due to lower OSB prices impacting overall revenue [7][18] - The Siding business achieved a 26% EBITDA margin in Q1, with expectations for similar performance in Q2 [8][20] Business Line Data and Key Metrics Changes - Siding revenue grew by 11% due to a 9% increase in volumes and a 2% increase in prices, outperforming single-family starts by 15 points [15][20] - OSB revenue and EBITDA were negatively impacted by lower commodity prices, resulting in a $32 million reduction in revenue and a $7 million reduction in EBITDA [18][20] Market Data and Key Metrics Changes - Single-family starts fell by 6% in Q1 due to economic volatility and unfavorable weather conditions [5][6] - The Siding order file remains strong, with expectations for a record second quarter, indicating resilience despite market challenges [6][20] Company Strategy and Development Direction - The company is focused on expanding its Siding business, introducing new specialized products to drive growth and margin expansion [6][8] - Management emphasized the importance of product innovation and market share gains, particularly in the Siding segment, while maintaining a cautious approach to OSB due to current market conditions [12][44] Management's Comments on Operating Environment and Future Outlook - Management noted that while tariff uncertainties and commodity price fluctuations pose challenges, the Siding business is well-positioned for growth [11][20] - The company remains confident in its ability to mitigate tariff impacts and is focused on operational efficiency and product innovation [13][20] Other Important Information - The company has $1 billion in liquidity, providing flexibility to navigate market uncertainties [19] - A new product line, the Naturals Collection, was introduced, contributing to a positive mix effect on pricing [9][20] Q&A Session Summary Question: Key drivers for Siding outperformance - Management highlighted strength across the entire order file, particularly in shed orders and the R&R sector, contributing to strong performance [24][26] Question: Inventory levels in the channel - Management indicated that home center inventories were normalizing, with seasonal levels appropriate for the spring market [27][29] Question: Siding margin progression - Management expressed cautious optimism for margin expansion in the second half of the year, with expectations for continued growth [36][39] Question: OSB capacity and market dynamics - Management acknowledged current market pressures due to increased capacity and emphasized a long-term bullish outlook for OSB as housing recovers [42][44] Question: Impact of marketing investments on order file - Management noted that investments in marketing and product development are yielding positive results, particularly in the R&R sector [46][49] Question: Siding pricing outlook - Management implemented price increases in January, with expectations for slight year-over-year pricing improvement in Q2 [60][62] Question: Competitive landscape following a merger in Siding - Management remains confident in their market position and sees no immediate risks from competitor mergers, focusing on their growth strategy [83][84] Question: OSB project returns amid inflation concerns - Management confirmed that the Holton expansion project remains a priority, with expected returns still above the cost of capital despite inflationary pressures [71][73]

Company Performance - Louisiana-Pacific (LPX) reported quarterly earnings of $1.27 per share, exceeding the Zacks Consensus Estimate of $1.13 per share, but down from $1.53 per share a year ago, representing an earnings surprise of 12.39% [1] - The company posted revenues of $724 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 4.50%, with year-ago revenues also at $724 million [2] - Over the last four quarters, Louisiana-Pacific has consistently surpassed consensus EPS estimates [2] Stock Outlook - The stock has underperformed the market, losing about 15.5% since the beginning of the year compared to the S&P 500's decline of 3.9% [3] - The current consensus EPS estimate for the coming quarter is $1.53 on revenues of $773.6 million, and for the current fiscal year, it is $4.99 on revenues of $2.95 billion [7] Industry Context - The Building Products - Wood industry, to which Louisiana-Pacific belongs, is currently ranked in the bottom 32% of over 250 Zacks industries, indicating potential challenges ahead [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Louisiana-Pacific's stock performance [5]

Financial Performance Overview - Net sales remained flat year-over-year at $724 million[11] - Adjusted EBITDA decreased to $162 million compared to $182 million in Q1 2024[11, 37] - Adjusted EPS decreased to $1.27 from $1.53 in Q1 2024[11, 38] Siding Solutions - Siding Solutions net sales increased by $41 million to $402 million, compared to $361 million in Q1 2024[22, 39] - Siding Solutions sales volume increased by 9%[12] - Siding Solutions adjusted EBITDA increased to $106 million, up from $90 million in Q1 2024[22, 39] - Siding Solutions EBITDA margin was 26%[12] OSB (Oriented Strand Board) - OSB net sales decreased to $267 million, compared to $313 million in Q1 2024[26, 39] - OSB adjusted EBITDA decreased to $54 million, down from $90 million in Q1 2024[26, 39] - Overall OSB volume decreased by 10%[26] Capital Allocation and Liquidity - Capital expenditures totaled $64 million[11] - The company returned $81 million to shareholders, including $20 million in dividends and $61 million in share repurchases[11, 12] - The company has $1 billion in total liquidity[12]

Sales Performance - Siding net sales increased by $41 million (11%) to $402 million, driven by 9% higher volumes and 2% higher prices[5] - OSB net sales decreased by $46 million (15%) to $267 million, due to 11% lower prices and 4% lower volumes[9] - Consolidated net sales remained flat at $724 million[9] - Net sales for Q1 2025 remained flat at $724 million compared to Q1 2024[22] - Net sales for the Siding segment increased to $402 million in Q1 2025 from $361 million in Q1 2024, while OSB segment sales decreased to $267 million from $313 million[31] Income and Profitability - Net income decreased by $17 million to $91 million, with net income per diluted share at $1.30, a decrease of $0.18[10] - Net income for Q1 2025 was $91 million, a decrease of 15.7% from $108 million in Q1 2024[22] - Gross profit decreased to $197 million in Q1 2025, down from $214 million in Q1 2024, representing a decline of approximately 7.9%[22] - Adjusted income decreased to $89 million in Q1 2025 from $111 million in Q1 2024, with adjusted diluted EPS falling to $1.27 from $1.53[32] EBITDA and Key Performance Measures - Adjusted EBITDA was $162 million, a decrease of $20 million year-over-year[5] - Adjusted EBITDA decreased to $162 million in Q1 2025 from $182 million in Q1 2024, with Siding segment adjusted EBITDA increasing to $106 million from $90 million[32] - Adjusted EBITDA is reported as a key performance measure, reflecting the company's operational performance[20] Future Guidance - The company expects Siding net sales for Q2 2025 to be between $445 million and $455 million, representing 9-10% growth[6] - Full year 2025 Siding net sales guidance is approximately $1.7 billion, indicating over 9% growth[6] - Capital expenditures for full year 2025 are expected to be around $410 million[6] Liquidity and Capital Management - Total liquidity as of March 31, 2025, was $1.0 billion[5] - Cash and cash equivalents decreased to $256 million as of March 31, 2025, down from $340 million at the end of 2024[23] - The company repurchased $61 million of common stock in Q1 2025, compared to $13 million in Q1 2024[24] Market Indicators - Housing starts in the U.S. are monitored as a leading indicator of demand for the company's products[25] - Housing starts for single-family homes decreased to 228,000 in Q1 2025 from 241,000 in Q1 2024, while multi-family starts increased to 89,000 from 80,000[27] - The total number of housing starts reported by the U.S. Census Bureau for Q1 2025 was 317,000, slightly down from 321,000 in Q1 2024[27] Operational Efficiency - Overall equipment effectiveness (OEE) for Siding segment decreased to 76% in Q1 2025 from 78% in Q1 2024, and for LPSA segment decreased to 67% from 76%[30] - The company aims to optimize capital investments and improve overall equipment efficiency through OEE tracking across all sites[29] - The company monitors sales volumes in million square feet (MMSF) to identify changes in product demand and market opportunities[28]

Since the start of 2025, the United States construction sector has been navigating through choppy waters, hit by several unfavorable market factors, including a still-high mortgage rate scenario and an unhinged interest rate environment. With the 30-year mortgage rate lingering between 6.9% and 6.7% (during the January-March 2025 period), reaching as high as 7.04% for the week ending on Jan. 16, 2025, the residential construction market is likely to have remained soft, mainly for the multi-family starts. Ho ...

Company Overview - Louisiana-Pacific (LPX) is expected to report a year-over-year decline in earnings, with a projected EPS of $1.13, reflecting a decrease of 26.1% [3] - Revenues for the quarter are anticipated to be $692.85 million, down 4.3% from the previous year [3] Earnings Expectations - The earnings report is scheduled for release on May 6, 2025, and actual results that exceed expectations could lead to a stock price increase, while a miss may result in a decline [2] - The consensus EPS estimate has remained unchanged over the last 30 days, indicating a stable outlook from covering analysts [4] Earnings Surprise Prediction - The Most Accurate Estimate for Louisiana-Pacific is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -2.44%, suggesting a bearish sentiment among analysts [10] - The company currently holds a Zacks Rank of 4, making it challenging to predict an earnings beat [11] Historical Performance - In the last reported quarter, Louisiana-Pacific exceeded the expected EPS of $0.79 by delivering $1.03, resulting in a surprise of +30.38% [12] - Over the past four quarters, the company has beaten consensus EPS estimates four times [13] Industry Comparison - Boise Cascade (BCC), another player in the Zacks Building Products - Wood industry, is expected to report earnings of $1.36 per share, reflecting a year-over-year decline of 47.9% [17] - Boise Cascade's revenues are projected to be $1.45 billion, down 11.6% from the previous year [17] - The company has an Earnings ESP of 9.56% and a Zacks Rank of 3, indicating a higher likelihood of beating the consensus EPS estimate [18]

Group 1: Coca-Cola (KO) - Coca-Cola offers a 2.8% dividend yield and is considered relatively safe in the current market environment, making it a strong investment choice [2][3] - The company is insulated from cross-border tariffs due to its local production and sales strategy, which minimizes exposure to tariff impacts [2][3] - Increased packaging costs from tariffs on aluminum are not significant for Coca-Cola, as aluminum constitutes a small part of its overall cost structure [3] Group 2: Louisiana-Pacific (LPX) - Louisiana-Pacific specializes in engineered wood siding and oriented strand board (OSB), with its pricing heavily influenced by wood fiber and resin costs [4] - The company could benefit from tariffs on Canadian wood fiber, as it has the capacity to increase production in both Canada and the U.S. [5][6] - Long-term prospects for engineered wood siding are positive, with potential market share gains against alternatives like vinyl and fiber cement [7] Group 3: Pool Corp. (POOL) - Pool Corp. is a resilient business, with 65% of its sales coming from maintenance and minor repairs, which supports sales even in a slowing discretionary spending environment [8] - The company does not have significant direct imports and does not anticipate material impacts from current tariffs on sales for 2025 [10] - Long-term growth prospects remain strong due to ongoing pool maintenance spending and a potential recovery in new pool construction [11]

Core Viewpoint - Louisiana-Pacific (LPX) is experiencing a decline in share price and is under scrutiny ahead of its upcoming earnings report, with expectations of lower earnings and revenue compared to the previous year [2][3]. Group 1: Recent Performance - In the latest trading session, LPX closed at $84.20, reflecting a +0.44% change from the previous day, outperforming the S&P 500's gain of 0.13% [1]. - Over the past month, LPX shares have decreased by 10.9%, which is worse than the Construction sector's loss of 7.68% and the S&P 500's loss of 6.3% [1]. Group 2: Earnings Expectations - Louisiana-Pacific is scheduled to release its earnings on May 6, 2025, with an expected EPS of $1.13, indicating a 26.14% decline from the same quarter last year [2]. - The consensus estimate for revenue is projected at $692.85 million, reflecting a 4.3% decrease from the equivalent quarter last year [2]. Group 3: Full Year Projections - For the full year, Zacks Consensus Estimates project earnings of $4.99 per share and revenue of $2.95 billion, showing changes of -15.14% and +0.39% respectively from the previous year [3]. Group 4: Analyst Estimates and Rankings - Recent changes to analyst estimates for Louisiana-Pacific indicate a shift in business outlook, with positive revisions seen as a sign of optimism [3]. - The Zacks Rank system, which evaluates estimated changes, currently ranks Louisiana-Pacific at 4 (Sell), with a consensus EPS projection that has moved 2.44% lower in the past 30 days [5]. Group 5: Valuation Metrics - Louisiana-Pacific has a Forward P/E ratio of 16.8, which is lower than the industry average of 17.1, indicating it is trading at a discount [6]. - The company has a PEG ratio of 1.09, compared to the Building Products - Wood industry's average PEG ratio of 2, suggesting a more favorable valuation relative to growth expectations [7].