Higher OSB prices and a recovering housing market pushed building-products manufacturer Louisiana-Pacific to its best quarter since 2006. Adjusted operating EBITDA rose to $121 million during the first quarter from $21 million a year earlier as sales climbed 49% to $538 million for the same period, the company announced May 7.
An 82% spike in OSB prices from the first quarter of 2012 and OSB sales volumes 12% higher for the same period contributed to a $109 million EBITDA gain—compared to EBITDA of $11 million for the year-earlier quarter—in the company’s OSB business. Revenues in that segment nearly doubled to $149 million from $287 million in the first quarter of 2012. Hamstrung by rising raw material costs, LP’s engineered wood products division deepened its operating loss to $4 million from $3 million a year earlier while segment revenues rose 29% to $63 million during the period on a 35% increase in I-joist sales volumes and a 13% increase each in LVL and LSL volumes.
LP joins other wood-products manufacturers in steadily ramping up production capacity. CEO Curt Stevens told analysts in a call May 7 that the company this quarter will complete its purchase of Canfor’s 50% share in the pair’s Peace Valley joint venture mill, which is now running continuously. The company also added a fourth shift to its Maniwaki, Quebec, mill and in the coming months will begin rescaling its Swan Valley, Manitoba, plant to full capacity. The company reopened its Clarke County, Ala., mill in April and plans to restart its Dawson Creek, British Columbia, facility this summer.
Trex posted its best quarter on record, nearly doubling its bottom line to $21.6 million during the first quarter as sales jumped 12% to $107.9 million, the company announced May 3. The Winchester, Va.-based decking maker grew its margins to 38.8% during the period compared to 36.8% a year earlier.
“We have a lot of feet on the street out there, listening,” CEO Ron Kaplan told analysts in a call May 3. “Contractors are busy. The phones are ringing. There has been some compression to the season because of the weather. … [But] what we see going forward is fairly robust.”
Trex used the first quarter to launch new product initiatives, including its Transcend decking as well as a suite of PVC and aluminum railing products that Kaplan says target an estimated $325 million market opportunity. The company announced during the quarter that it will discontinue its entry-level Accents decking in late 2013.