Louisiana-Pacific Corp. (LP) reported today its loss from continuing operations in the third quarter more than tripled from the year-earlier period to reach $31 million from $12.5 million even though sales grew 4% to $323 million.
Nashville, Tenn.-based LP refers to view its results in terms of adjusted EBITDA--earnings before interest, taxes, depreciation, and amortization as well as some other factors. By that measure, adjusted EBITDA shrank to a $4 million profit from an $11 million profit in the July-to-September 2009 period, the company announced..
"In the third quarter, we saw a transition to a housing market without tax credits," Rick Frost, the company's chief executive officer, said in the announcement. "The channel adjusted inventories downward with very slow building activity in July and August. Activity did increase slightly in September.
"Our outlook for the short term has not changed much from last quarter," Frost added. "We continue to believe the recovery in housing construction will be erratic. The timing and strength of the upturn will be determined by the speed with which vacant homes for sale are sold and household formations occur enabled by job recovery."
The operating loss at LP's oriented strand board (OSB) segment lessened slightly to $5 million in the third quarter from a year-earlier $5.8 million. Sales grew 14% to $139.5 million, as the volume climbed 4% to 814 million square feet (3/8-inch basis) and the average price of product sold increased 9%, in part from exchange-rate differences caused by the strengthening Canadian dollar.
The siding segment, meanwhile, saw operating income shrink to $9.3 million from $16.1 million. Sales dropped 8% to $104.5 million, with volumes falling 24.7% to 146 million square feet (3/8-inch basis) and a modest gain in price.
Operating losses in the engineered wood products (EWP) segment improved a bit to $4.9 million from a $6.2 million 3Q09 loss. Sales decreased 21% to $37.9 million. Volumes were "significantly lower," with i-joist production slumping to 12 million lineal feet from a year-earlier 21 million feet and LVL and LSL output falling to 1.12 million cubic feet from 1.45 million. But sales prices grew, offset in part by higher raw material costs.