LP Reports Fourth Quarter and Year End 2018 Results; Announces Strategic Update and Additional $600 Million Share Repurchase Plan; Appointment of Director and Provides 2019 Guidance
Fourth Quarter and Full Year Results
-
Net sales for the fourth quarter of
$589 million , 17 percent lower than prior quarter. Total net sales for the year were$2.8 billion , 3 percent higher than the previous year. -
Net income for the fourth quarter was
$17 million ($0.12 per diluted share) and$395 million ($2.73 per diluted share) for the year. -
Non-GAAP adjusted income from continuing operations was
$27 million ($0.19 per diluted share) for the fourth quarter and$397 million ($2.75 per diluted share) for the year. -
Adjusted EBITDA for the fourth quarter was
$65 million and$660 million for the year. -
Siding segment results were negatively impacted in the fourth quarter
by increased marketing investment associated with accelerating repair
and remodel channel penetration and new product introductions, and a
number of headwinds we expect to be temporary, including downtime at
its SmartSide Fiber and CanExel facilities and the
Dawson Creek mill conversion. -
Repurchased 5.1 million shares for
$113 million during the fourth quarter for a total of 8.6 million shares for$212 million during 2018. -
Paid
$18 million in dividends during the fourth quarter and$74 million during 2018.
Strategic Update and Capital Allocation Plan
- LP re-affirms its long-term SmartSide Strand revenue growth target of 12-14 percent.
Target of$75 million of increased EBITDA by 2021 via operational improvement initiatives, supply chain optimization, and management structure transition.-
Authorization of a new
$600 million share repurchase program, including the intent to initially enter into a$400 million accelerated share repurchase program. This is expected to result in LP repurchasing$638 million of stock during 2019 when combined with the$38 million outstanding under the previous$250 million stock repurchase authorizations. -
4% increase in the quarterly cash dividend to
$0.135 per share. - Commitment to return over time to shareholders at least 50 percent of cash flow from operations in excess of capital expenditures required to sustain our core business and grow Siding and value-added OSB.
Corporate Governance
-
Appointment of
Stephen E. Macadam to the LP Board of Directors.
Fourth Quarter and Full Year Performance
“2018 was a strong year for LP. Although our fourth quarter results were
impacted by increasing macro environment headwinds as well as a number
of headwinds that we believe to be temporary, we continued to produce
positive results from our strategic transformation into a leading
building solutions company,” said
Strategic Update
LP has made significant progress in its business transformation efforts over the last several years, in particular by substantially growing its Siding business and increasing the mix of value-added product sold by its OSB business. LP expects it will be more resilient and cash flow generative through market cycles going forward.
LP sees continued growth opportunities in its Siding business, and is
re-affirming its long term SmartSide Strand revenue growth target of
12-14 percent. In addition, LP sees the opportunity to improve EBITDA by
$40 million from sustainable improvement in Overall Equipment Effectiveness across its Siding and OSB mills;-
Approximately
$25 million from supply chain optimization across its$1.1 billion of addressable spend (approximately$8 million of incremental impact annually); and $10 million from its investment in line management and infrastructure optimization.
Capital Allocation Plan
After a thorough review of the liquidity needs of the business,
management has set a maximum liquidity target of
LP’s Board of Directors has authorized an additional stock repurchase
plan under which LP intends to repurchase
Southern continued, “Successfully executing our transformation strategy has enabled us to optimize our capital structure and accelerate the return of capital to our investors. We believe these actions will help LP to deliver on our vision to provide top-tier shareholder returns.”
Appointment of
LP also announced the appointment of
“On behalf of LP’s board and management, I am pleased to welcome Steve to LP’s board. He brings valuable operational and industry experience and will complement the diverse skillsets and backgrounds of our current Board members,” continued Southern.
Fourth Quarter and Year End Results
For the quarter ended
For the year ended
Segment Results
Siding
The Siding segment consists of LP SmartSide® trim and siding, LP
CanExel® prefinished siding, as well as LP Outdoor Building Solutions®
innovative products for premium outdoor buildings. The Siding segment
reported net sales of
Siding segment results were negatively impacted in the fourth quarter by
increased marketing investment associated with accelerating repair and
remodel channel penetration and new product introductions, and a number
of headwinds we expect to be temporary, including downtime at its
SmartSide Fiber and CanExel facilities and the
For the full year, Siding reported sales of
Oriented Strand Board
The OSB segment manufactures and distributes OSB structural panel
products including
For the full year, OSB reported net sales of
Engineered Wood Products (EWP)
The EWP segment is comprised of LP SolidStart® I-Joist (IJ), Laminated
Veneer Lumber (LVL) and Laminated Strand Lumber (LSL) and other related
products. The EWP segment reported net sales in the fourth quarter of
2018 totaling
For the full year, EWP reported net sales of
The
For the full year,
2019 Guidance
LP’s 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 in LP’s “Forward-Looking Statements.”
-
Given its current outlook, LP expects capital expenditures for 2019 to
be in the range of
$150 million to $180 million . - LP is maintaining its long-term growth target of 12-14 percent on Smart Side sales growth but is guiding to the lower end of the range for 2019 based upon projected flat housing starts.
About LP Building Solutions
As a proven leader in high-performance building solutions,
FORWARD LOOKING STATEMENTS
This news release contains statements concerning
Use of Non-GAAP information
In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), this press release discloses segment earnings (loss) from continuing operations before interest expense, taxes, depreciation and amortization and exclude stock based compensation expense, (gain) loss on sales or impairment of long-lived assets, other operating credits and charges, net, loss on early debt extinguishment, investment income and other non-operating items as Adjusted EBITDA which is a non-GAAP financial measure. It also discloses Adjusted income from continuing operations which excludes (gain) loss on sale or impairment of long-lived assets, interest outside of normal operations, other operating credits and charges, net, early debt extinguishment and adjusts for a normalized tax rate. Adjusted EBITDA and Adjusted income from continuing operations are not a substitute for the GAAP measure of net income or operating cash flows or other GAAP measures of operating performance or liquidity.
LP has Adjusted EBITDA in this press release because it uses this as important supplemental measure of our performance and believe that similarly-titled measures are frequently used by securities analysts, investors and other interested persons in the evaluation of companies in our industry, some of which present similarly-titled measures when reporting their results. LP uses Adjusted EBITDA to evaluate its performance as compared to other companies in its industry that have different financing and capital structures and/or tax rates. It should be noted that companies calculate similarly-titled measures differently and, therefore, as presented by LP may not be comparable to similarly-titled measures reported by other companies. In addition, Adjusted EBITDA has material limitations as a performance measure because it excludes interest expense, income tax (benefit) expense and depreciation and amortization which are necessary to operate our business or which LP otherwise incurred or experienced in connection with the operation of its business.
LP believes that Adjusted income from continuing operations, which excludes (gain) loss on sale or impairment of long-lived assets, interest outside of normal operations, other operating credits and charges, net and early debt extinguishment, adjusted for a normalized tax rate is a useful measure for evaluating our ability to generate earnings and that providing this measure will allow investors to more readily compare the earnings referred to in the press release to our earnings for past and future periods. LP believes that this measure is particularly useful where the amounts of the excluded items are not consistent between the periods presented. It should be noted that other companies may present similarly-titled measures differently and, therefore, as presented by LP may not be comparable to similarly-titled measures reported by other companies. In addition, Adjusted income (loss) from continuing operations has material limitations as a performance measure because it excludes items that are actually incurred or experienced in connection with the operations of its business.
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CONSOLIDATED STATEMENTS OF INCOME |
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LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES (AMOUNTS IN MILLIONS EXCEPT PER SHARE AMOUNTS (UNAUDITED) |
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Quarter Ended December 31, |
Year Ended December 31, |
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| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
| Net sales | $ | 589.1 | $ | 710.6 | $ | 2,828.0 | $ | 2,733.9 | ||||||||||||
| Cost of sales | 495.3 | 495.8 | 2,084.0 | 1,998.1 | ||||||||||||||||
| Gross profit | 93.8 | 214.8 | 744.0 | 735.8 | ||||||||||||||||
| Selling and administrative | 57.4 | 46.1 | 209.3 | 191.3 | ||||||||||||||||
| (Gain) loss on sale or impairment of long-lived assets, net | 11.1 | 8.6 | 10.8 | 6.8 | ||||||||||||||||
| Other operating credits and charges, net | 9.0 | 0.4 | (2.2 | ) | 4.9 | |||||||||||||||
| Income from operations | 16.3 | 159.7 | 526.1 | 532.8 | ||||||||||||||||
| Non-operating income (expense): | ||||||||||||||||||||
| Interest expense, net of capitalized interest | (3.1 | ) | (4.5 | ) | (15.8 | ) | (19.3 | ) | ||||||||||||
| Investment income | 4.1 | 3.3 | 17.6 | 10.5 | ||||||||||||||||
| Other non-operating items | 0.4 | (6.6 | ) | (3.9 | ) | (13.8 | ) | |||||||||||||
|
Total non-operating income (expense) |
1.4 | (7.8 | ) | (2.1 | ) | (22.6 | ) | |||||||||||||
| Income from continuing operations before income taxes and equity in income of unconsolidated affiliate | 17.7 | 151.9 | 524.0 | 510.2 | ||||||||||||||||
| Provision (benefit) for income taxes | (0.4 | ) | 21.2 | 122.3 | 119.1 | |||||||||||||||
| Equity in loss of unconsolidated affiliates | 1.2 | — | 2.9 | — | ||||||||||||||||
| Income from continuing operations | 16.9 | 130.7 | 398.8 | 391.1 | ||||||||||||||||
| Income (loss) from discontinued operations before taxes | 0.1 | (0.3 | ) | (5.6 | ) | (2.0 | ) | |||||||||||||
| Benefit for income taxes | — | (0.1 | ) | (1.4 | ) | (0.7 | ) | |||||||||||||
| Loss from discontinued operations | 0.1 | (0.2 | ) | (4.2 | ) | (1.3 | ) | |||||||||||||
| Net income | $ | 17.0 | $ | 130.5 | $ | 394.6 | $ | 389.8 | ||||||||||||
| Net income per share of common stock: | ||||||||||||||||||||
| Income from continuing operations | $ | 0.12 | $ | 0.90 | $ | 2.79 | $ | 2.71 | ||||||||||||
| Loss from discontinued operations | — | — | (0.03 | ) | (0.01 | ) | ||||||||||||||
| Net income per share - basic | $ | 0.12 | $ | 0.90 | $ | 2.76 | $ | 2.70 | ||||||||||||
| Diluted net income per share of common stock: | ||||||||||||||||||||
| Income from continuing operations | $ | 0.12 | $ | 0.89 | $ | 2.76 | $ | 2.67 | ||||||||||||
| Loss from discontinued operations | — | — | (0.03 | ) | (0.01 | ) | ||||||||||||||
| Net income per share - diluted | $ | 0.12 | $ | 0.89 | $ | 2.73 | $ | 2.66 | ||||||||||||
| Weighted average shares of stock outstanding - basic | 140.0 | 144.6 | 143.0 | 144.4 | ||||||||||||||||
| Weighted average shares of stock outstanding - diluted | 141.1 | 146.6 | 144.4 | 146.4 | ||||||||||||||||
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CONSOLIDATED BALANCE SHEET |
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LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES (AMOUNTS IN MILLIONS EXCEPT PER SHARE AMOUNTS) (UNAUDITED) |
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| December 31, | ||||||||||
| 2018 | 2017 | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 878.4 | $ | 928.0 | ||||||
| Receivables, net of allowance for doubtful accounts of $0.8 million and $0.9 million at December 31, 2018 and 2017 | 127.6 | 142.5 | ||||||||
| Inventories | 273.0 | 259.1 | ||||||||
| Prepaid expenses and other current assets | 8.2 | 7.8 | ||||||||
| Current portion of notes receivable from asset sales | — | 22.2 | ||||||||
| Total current assets | 1,287.2 | 1,359.6 | ||||||||
| Timber and timberlands | 62.4 | 55.7 | ||||||||
| Property, plant and equipment, net | 1,010.4 | 926.1 | ||||||||
| Goodwill and other intangible assets | 26.2 | 26.7 | ||||||||
| Investments in and advances to affiliates | 49.4 | 7.8 | ||||||||
| Restricted cash | 13.4 | 13.3 | ||||||||
| Other assets | 61.2 | 56.8 | ||||||||
| Deferred tax asset | 3.9 | 2.5 | ||||||||
| Total assets | $ | 2,514.1 | $ | 2,448.5 | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
| Current liabilities: | ||||||||||
| Current portion of long-term debt | $ | 5.0 | $ | 25.1 | ||||||
| Accounts payable and accrued liabilities | 233.3 | 237.1 | ||||||||
| Income taxes payable | 21.0 | 4.5 | ||||||||
| Current portion of contingency reserves | 2.3 | 3.4 | ||||||||
| Total current liabilities | 261.6 | 270.1 | ||||||||
| Long-term debt, excluding current portion | 346.9 | 350.8 | ||||||||
| Deferred income taxes | 62.2 | 33.4 | ||||||||
| Contingency reserves, excluding current portion | 8.5 | 11.7 | ||||||||
| Other long-term liabilities | 134.7 | 178.0 | ||||||||
| Stockholders’ equity: | ||||||||||
| Common stock | 153.4 | 153.4 | ||||||||
| Additional paid-in capital | 458.2 | 470.6 | ||||||||
| Retained earnings | 1,612.6 | 1,280.1 | ||||||||
| Treasury stock | (377.6 | ) | (177.5 | ) | ||||||
| Accumulated comprehensive loss | (146.4 | ) | (122.1 | ) | ||||||
| Total stockholders’ equity | 1,700.2 | 1,604.5 | ||||||||
| Total liabilities and stockholders’ equity | $ | 2,514.1 | $ | 2,448.5 | ||||||
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CONDENSED CONSOLIDATED CASH FLOW STATEMENT |
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LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES (Dollar amounts in millions) (Unaudited) |
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Quarter Ended |
|
Year Ended |
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| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||||||||||||
| Net income | $ | 17.0 | $ | 130.5 | $ | 394.6 | $ | 389.8 | ||||||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||||||||
| Depreciation and amortization | 28.2 | 32.0 | 120.0 | 123.3 | ||||||||||||||||||
| Equity in (income) loss of unconsolidated affiliates, including dividends | 3.1 | 0.4 | 3.3 | (0.8 | ) | |||||||||||||||||
| Other operating credits and charges, net | 9.1 | 0.4 | 2.2 | 4.9 | ||||||||||||||||||
| (Gain) loss on sale or impairment of long-lived assets, net | 11.1 | 8.6 | 10.8 | 6.8 | ||||||||||||||||||
| Stock-based compensation | 1.7 | 1.7 | 8.6 | 9.7 | ||||||||||||||||||
| Exchange (gain) loss on remeasurement | (1.6 | ) | 0.5 | (1.1 | ) | 2.1 | ||||||||||||||||
| Cash settlements of warranty, net of accruals | (0.7 | ) | (1.3 | ) | (2.9 | ) | (6.8 | ) | ||||||||||||||
| Cash settlement of contingencies, net of accruals | (0.2 | ) |
|
(0.5 | ) | (2.3 | ) | (1.0 | ) | |||||||||||||
| Pension contributions | (0.2 | ) | (0.1 | ) | (41.1 | ) | (12.8 | ) | ||||||||||||||
| Pension expense | 0.6 | 5.3 | 7.5 | 14.1 | ||||||||||||||||||
| Other adjustments, net | 0.6 | 1.2 | 1.2 | 1.5 | ||||||||||||||||||
| Changes in assets and liabilities, net of acquisition: | ||||||||||||||||||||||
| (Increase) decrease in receivables | 29.6 | 26.9 | 3.4 | (35.0 | ) | |||||||||||||||||
| (Increase) decrease in inventories | 9.8 | (27.2 | ) | (1.9 | ) | (22.7 | ) | |||||||||||||||
| (Increase) decrease in prepaid expenses | 3.7 | 1.1 | (0.4 | ) | (1.6 | ) | ||||||||||||||||
| Increase (decrease) in accounts payable and accrued liabilities | (3.1 | ) | 9.7 | (20.7 | ) | 22.5 | ||||||||||||||||
| Increase (decrease) in income taxes payable and deferred income taxes | (17.4 | ) | (20.5 | ) | 29.3 | (20.3 | ) | |||||||||||||||
| Net cash provided by operating activities | 91.3 | 168.7 | 510.5 | 473.7 | ||||||||||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||||||||||||||
| Property, plant, and equipment additions | (63.8 | ) | (67.9 | ) | (214.2 | ) | (148.6 | ) | ||||||||||||||
| Proceeds from asset sales | 0.1 | (0.1 | ) | 1.0 | 3.2 | |||||||||||||||||
| Acquisition of businesses, net of cash acquired | — | (20.8 | ) | — | (20.8 | ) | ||||||||||||||||
| Investment in unconsolidated affiliates | — | — | (45.0 | ) | — | |||||||||||||||||
| Receipt of proceeds from notes receivable from asset sales | — | — | 22.2 | — | ||||||||||||||||||
| Payment of long-term deposit | — | — | — | (32.0 | ) | |||||||||||||||||
| Other investing activities, net | (1.8 | ) | (0.7 | ) | (2.2 | ) | (0.4 | ) | ||||||||||||||
| Net cash provided (used in) investing activities | (65.5 | ) | (89.5 | ) | (238.2 | ) | (198.6 | ) | ||||||||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||||||||||||||
| Repayment of long-term debt | (2.3 | ) | (0.1 | ) | (24.7 | ) | (2.6 | ) | ||||||||||||||
| Payment of debt issuance fees | — | (0.5 | ) | — | (0.5 | ) | ||||||||||||||||
| Payment of cash dividends | (18.3 | ) | — | (74.4 | ) | — | ||||||||||||||||
| Purchase of treasury stock | (113.1 | ) | — | (211.8 | ) |
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— | |||||||||||||||
| Taxes paid related to net share settlement of equity awards | — | (0.6 | ) | (9.3 | ) | (5.9 | ) | |||||||||||||||
| Other financing activities, net | — | — | 3.2 | (0.4 | ) | |||||||||||||||||
| Net cash used in financing activities | (133.7 | ) | (1.2 | ) | (317.0 | ) | (9.4 | ) | ||||||||||||||
| Effect of exchange rate on cash, cash equivalents and restricted cash | (0.3 | ) | 1.4 | (4.8 | ) | 3.1 | ||||||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | (108.2 | ) | 79.4 | (49.5 | ) | 268.8 | ||||||||||||||||
| Cash, cash equivalents and restricted cash at beginning of year | 1,000.0 | 861.9 | 941.3 | 672.5 | ||||||||||||||||||
| Cash, cash equivalents and restricted cash at end of year | $ | 891.8 | $ | 941.3 | $ | 891.8 | $ | 941.3 | ||||||||||||||
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LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES |
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SELECTED SEGMENT INFORMATION (Dollar amounts in millions) (Unaudited) |
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| Quarter Ended December 31, | Year Ended December 31, | |||||||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
| Net sales: | ||||||||||||||||||||
| Siding | $ | 212.9 | $ | 212.8 | $ | 942.3 | $ | 884.0 | ||||||||||||
| OSB | 255.4 | 358.2 | 1,305.2 | 1,302.5 | ||||||||||||||||
| Engineered Wood Products | 76.3 | 91.5 | 390.9 | 365.9 | ||||||||||||||||
| South America | 38.6 | 40.5 | 160.8 | 155.3 | ||||||||||||||||
| Other | 6.0 | 7.7 | 28.9 | 30.0 | ||||||||||||||||
| Intersegment sales | (0.1 | ) | (0.1 | ) | (0.1 | ) | (3.8 | ) | ||||||||||||
| $ | 589.1 | $ | 710.6 | $ | 2,828.0 | $ | 2,733.9 | |||||||||||||
| Operating profit (loss): | ||||||||||||||||||||
| Siding | $ | 33.8 | $ | 45.8 | $ | 201.6 | $ | 188.7 | ||||||||||||
| OSB | 26.1 | 136.7 | 395.7 | 427.3 | ||||||||||||||||
| Engineered Wood Products | (0.4 | ) | 3.1 | 19.5 | 15.7 | |||||||||||||||
| South America | 6.0 | 7.9 | 31.0 | 24.3 | ||||||||||||||||
| Other | (1.4 | ) | (0.7 | ) | (4.3 | ) | (3.4 | ) | ||||||||||||
| Other operating credits and charges, net | (9.0 | ) | (0.4 | ) | 2.2 | (4.9 | ) | |||||||||||||
| Loss on sale or impairment of long-lived assets | (11.1 | ) | (8.6 | ) | (10.8 | ) | (6.8 | ) | ||||||||||||
| General corporate and other expenses, net | (28.9 | ) | (24.1 | ) | (111.7 | ) | (108.1 | ) | ||||||||||||
| Interest expense, net of capitalized interest | (3.1 | ) | (4.5 | ) | (15.8 | ) | (19.3 | ) | ||||||||||||
| Investment income | 4.1 | 3.3 | 17.6 | 10.5 | ||||||||||||||||
| Other non-operating income (expense) | 0.4 | (6.6 | ) | (3.9 | ) | (13.8 | ) | |||||||||||||
| Income from continuing operations before taxes | 16.5 | 151.9 | 521.1 | 510.2 | ||||||||||||||||
| Provision (benefit) for income taxes | (0.4 | ) | 21.2 | 122.3 | 119.1 | |||||||||||||||
| Income from continuing operations | $ | 16.9 | $ | 130.7 | $ | 398.8 | $ | 391.1 | ||||||||||||
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LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES KEY STATISTICS |
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| Year Ended December 31, | |||||||||
| Housing starts1: |
2018 |
2017 |
|||||||
| Single Family | 828 | 848 | |||||||
| Multi-Family | 428 | 354 | |||||||
| 1,256 | 1,202 | ||||||||
| 1 Actual U.S. Housing starts data reported by U.S. Census Bureau. Information for 2018 is based upon seasonally adjusted information published through November 2018 based upon the partial U.S. Government shutdown. |
The following table sets forth sales volumes for the quarter and year
ended
| Quarter Ended December 31, 2018 | Quarter Ended December 31, 2017 | ||||||||||||||||||||||||||||||
| Sales Volume |
Siding |
OSB |
EWP |
Total |
Siding |
OSB |
EWP |
Total |
|||||||||||||||||||||||
| SmartSide® Strand siding (MMSF) | 277 | — | — | 277 | 263 | — | — | 263 | |||||||||||||||||||||||
| SmartSide® fiber siding (MMSF) | 46 | — | — | 46 | 56 | — | — | 56 | |||||||||||||||||||||||
| CanExel® siding (MMSF) | 4 | — | — | 4 | 7 | — | — | 7 | |||||||||||||||||||||||
| OSB - commodity (MMSF) | 24 | 643 | 5 | 672 | 41 | 668 | — | 709 | |||||||||||||||||||||||
| OSB - value added (MMSF) | 2 | 391 | 7 | 400 | — | 397 | 9 | 406 | |||||||||||||||||||||||
| LVL (MCF) | — | — | 1,353 | 1,353 | — | — | 1,865 | 1,865 | |||||||||||||||||||||||
| LSL (MCF) | — | — | 682 | 682 | — | — | 783 | 783 | |||||||||||||||||||||||
| I-joist (MMLF) | — | — | 17 | 17 | — | — | 21 | 21 | |||||||||||||||||||||||
| Year Ended December 31, 2018 | Year Ended December 31, 2017 | ||||||||||||||||||||||||||||||
| Sales Volume |
Siding |
OSB |
EWP |
Total |
Siding |
OSB |
EWP |
Total |
|||||||||||||||||||||||
| SmartSide® Strand siding (MMSF) | 1,139 | — | — | 1,139 | 1,059 | — | — | 1,059 | |||||||||||||||||||||||
| SmartSide® fiber siding (MMSF) | 222 | — | — | 222 | 254 | — | — | 254 | |||||||||||||||||||||||
| CanExel® siding (MMSF) | 36 | — | — | 36 | 48 | — | — | 48 | |||||||||||||||||||||||
| OSB - commodity (MMSF) | 136 | 2,582 | 33 | 2,751 | 230 | 2,642 | 34 | 2,906 | |||||||||||||||||||||||
| OSB - value added (MMSF) | 61 | 1,610 | 36 | 1,707 | — | 1,605 | 39 | 1,644 | |||||||||||||||||||||||
| LVL (MCF) | — | — | 6,932 | 6,932 | — | — | 7,593 | 7,593 | |||||||||||||||||||||||
| LSL (MCF) | — | — | 3,694 | 3,694 | — | — | 3,176 | 3,176 | |||||||||||||||||||||||
| I-joist (MMLF) | — | — | 86 | 86 | — | — | 87 | 87 | |||||||||||||||||||||||
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Reconciliation of Net income to Adjusted EBITDA |
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Three Months Ended December 31, 2018 |
Siding | OSB | EWP |
South |
Other | Corporate | Total | ||||||||||||||||||||||||||||
| Net income (loss) | $ | 33.8 | $ | 26.1 | $ | (0.4 | ) | $ | 6.0 | $ | (1.3 | ) | $ | (47.2 | ) | $ | 17.0 | ||||||||||||||||||
| Loss from discontinued operations | — | — | — | — | (0.1 | ) | — | (0.1 | ) | ||||||||||||||||||||||||||
| Benefit for income taxes | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||
| Income (loss) from continuing operations | 33.8 | 26.1 | (0.4 | ) | 6.0 | (1.4 | ) | (47.2 | ) | 16.9 | |||||||||||||||||||||||||
| Provision for income taxes | — | — | — | — | — | (0.4 | ) | (0.4 | ) | ||||||||||||||||||||||||||
| Interest expense, net of capitalized interest | — | — | — | — | — | 3.1 | 3.1 | ||||||||||||||||||||||||||||
| Depreciation and amortization | 7.5 | 14.5 | 2.6 | 2.4 | 0.4 | 0.8 | 28.2 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | 0.3 | — | 0.1 | — | — | 1.2 | 1.6 | ||||||||||||||||||||||||||||
| Gain on sale or impairment of long-lived assets, net | — | — | — | — | — | 11.1 | 11.1 | ||||||||||||||||||||||||||||
| Other operating credits and charges, net | — | — | — | — | — | 9.0 | 9.0 | ||||||||||||||||||||||||||||
| Investment income | — | — | — | — | — | (4.1 | ) | (4.1 | ) | ||||||||||||||||||||||||||
| Other non-operating items | — | — | — | — | — | (0.4 | ) | (0.4 | ) | ||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 41.6 | $ | 40.6 | $ | 2.3 | $ | 8.4 | $ | (1.0 | ) | $ | (26.9 | ) | $ | 65.0 | |||||||||||||||||||
| Adjusted EBITDA Margin | 19.5 | % | 15.9 | % | 3.0 | % | 21.8 | % | (16.7 | )% | NA | 11.0 | % | ||||||||||||||||||||||
|
Three Months Ended December 31, 2017 |
Siding | OSB | EWP |
South |
Other | Corporate | Total | ||||||||||||||||||||||||||||
| Net income (loss) | $ | 45.8 | $ | 136.7 | $ | 3.1 | $ | 7.9 | $ | (0.9 | ) | $ | (62.1 | ) | $ | 130.5 | |||||||||||||||||||
| Loss from discontinued operations | — | — | — | — | 0.3 | — | 0.3 | ||||||||||||||||||||||||||||
| Benefit for income taxes | — | — | — | — | (0.1 | ) | — | (0.1 | ) | ||||||||||||||||||||||||||
| Income (loss) from continuing operations | 45.8 | 136.7 | 3.1 | 7.9 | (0.7 | ) | (62.1 | ) | 130.7 | ||||||||||||||||||||||||||
| Provision for income taxes | — | — | — | — | — | 21.2 | 21.2 | ||||||||||||||||||||||||||||
| Interest expense, net of capitalized interest | — | — | — | — | — | 4.5 | 4.5 | ||||||||||||||||||||||||||||
| Depreciation and amortization | 7.2 | 16.8 | 4.2 | 2.3 | 0.7 | 0.8 | 32.0 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | 0.3 | 0.3 | 0.1 | — | — | 1.1 | 1.8 | ||||||||||||||||||||||||||||
| Loss on sale or impairment of long-lived assets, net | — | — | — | — | — | 8.6 | 8.6 | ||||||||||||||||||||||||||||
| Other operating credits and charges, net | — | — | — | — | — | 0.4 | 0.4 | ||||||||||||||||||||||||||||
| Investment income | — | — | — | — | — | (3.3 | ) | (3.3 | ) | ||||||||||||||||||||||||||
| Other non-operating items |
— |
— | — | — | — | 6.6 | 6.6 | ||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 53.3 | $ | 153.8 | $ | 7.4 | $ | 10.2 | $ | — | $ | (22.2 | ) | $ | 202.5 | ||||||||||||||||||||
| Adjusted EBITDA Margin | 25.0 | % | 42.9 | % | 8.1 | % | 25.2 | % | — | % | NA | 28.5 | % | ||||||||||||||||||||||
|
Year Ended December 31, 2018 |
Siding | OSB | EWP |
South |
Other | Corporate | Total | ||||||||||||||||||||||||||||
| Net income (loss) | $ | 201.6 | $ | 395.7 | $ | 19.5 | $ | 31.0 | $ | (8.5 | ) | $ | (244.7 | ) | $ | 394.6 | |||||||||||||||||||
| Loss from discontinued operations | — | — | — | — | 5.6 | — | 5.6 | ||||||||||||||||||||||||||||
| Benefit for income taxes | — | — | — | — | (1.4 | ) | — | (1.4 | ) | ||||||||||||||||||||||||||
| Income (loss) from continuing operations | 201.6 | 395.7 | 19.5 | 31.0 | (4.3 | ) | (244.7 | ) | 398.8 | ||||||||||||||||||||||||||
| Provision for income taxes | — | — | — | — | — | 122.3 | 122.3 | ||||||||||||||||||||||||||||
| Interest expense, net of capitalized interest | — | — | — | — | — | 15.8 | 15.8 | ||||||||||||||||||||||||||||
| Depreciation and amortization | 32.3 | 58.3 | 15.1 | 9.1 | 2.0 | 3.2 | 120.0 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | 1.1 | 0.7 | 0.4 | — | — | 5.8 | 8.0 | ||||||||||||||||||||||||||||
| Loss on sale or impairments of long-lived assets, net | — | — | — | — | — | 10.8 | 10.8 | ||||||||||||||||||||||||||||
| Other operating credits and charges, net | — | — | — | — | — | (2.2 | ) | (2.2 | ) | ||||||||||||||||||||||||||
| Investment income | — | — | — | — | — | (17.6 | ) | (17.6 | ) | ||||||||||||||||||||||||||
| Other non-operating items | — | — | — | — | — | 3.9 | 3.9 | ||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 235.0 | $ | 454.7 | $ | 35.0 | $ | 40.1 | $ | (2.3 | ) | $ | (102.7 | ) | $ | 659.8 | |||||||||||||||||||
|
Adjusted EBITDA Margin |
24.9 | % | 34.8 | % | 9.0 | % | 24.9 | % | (8.0 | )% | NA | 23.3 | % | ||||||||||||||||||||||
|
Year Ended December 31, 2017 |
Siding | OSB | EWP |
South |
Other | Corporate | Total | ||||||||||||||||||||||||||||
| Net income (loss) | $ | 188.7 | $ | 427.3 | $ | 15.7 | $ | 24.3 | $ | (4.7 | ) | $ | (261.5 | ) | $ | 389.8 | |||||||||||||||||||
| Loss from discontinued operations | — | — | — | — | 2.0 | — | 2.0 | ||||||||||||||||||||||||||||
| Benefit for income taxes | — | — | — | — | (0.7 | ) | — | (0.7 | ) | ||||||||||||||||||||||||||
| Income (loss) from continuing operations | 188.7 | 427.3 | 15.7 | 24.3 | (3.4 | ) | (261.5 | ) | 391.1 | ||||||||||||||||||||||||||
| Provision for income taxes | — | — | — | — | — | 119.1 | 119.1 | ||||||||||||||||||||||||||||
| Interest expense, net of capitalized interest | — | — | — | — | — | 19.3 | 19.3 | ||||||||||||||||||||||||||||
| Depreciation and amortization | 30.9 | 61.6 | 15.8 | 9.1 | 2.8 | 3.1 | 123.3 | ||||||||||||||||||||||||||||
| Stock-based compensation expense | 0.9 | 0.9 | 0.3 | — | — | 7.6 | 9.7 | ||||||||||||||||||||||||||||
| Loss on sale or impairments of long-lived assets, net | — | — | — | — | — | 6.8 | 6.8 | ||||||||||||||||||||||||||||
| Other operating credits and charges, net | — | — | — | — | — | 4.9 | 4.9 | ||||||||||||||||||||||||||||
| Investment income | — | — | — | — | — | (10.5 | ) | (10.5 | ) | ||||||||||||||||||||||||||
| Other non-operating items | — | — | — | — | — | 13.8 | 13.8 | ||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 220.5 | $ | 489.8 | $ | 31.8 | $ | 33.4 | $ | (0.6 | ) | $ | (97.4 | ) | $ | 677.5 | |||||||||||||||||||
| Adjusted EBITDA Margin | 24.9 | % | 37.6 | % | 8.7 | % | 21.5 | % | (2.0 | )% | NA | 24.8 | % | ||||||||||||||||||||||
|
Reconciliation of Net income to Adjusted income from continuing operations |
|||||||||||
| (Dollar amounts in millions, except per share amounts) | Quarter Ended | ||||||||||
| December 31, 2018 | December 31, 2017 | ||||||||||
| Net income | $ | 17.0 | 130.6 | ||||||||
| Add (deduct): | |||||||||||
| (Income) loss from discontinued operations | (0.1 | ) | 0.2 | ||||||||
| Loss on sale or impairment of long-lived assets, net | 11.1 | 8.6 | |||||||||
| Other operating credits and charges, net | 9.0 | 0.4 | |||||||||
| Reported tax provision | (0.4 | ) | 21.2 | ||||||||
| Normalized tax provision at 25% for 2018 and 35% for 2017 | (9.2 | ) | (56.4 | ) | |||||||
| Adjusted income from continuing operations | $ | 27.4 | $ | 104.6 | |||||||
| Diluted shares outstanding | 141.1 | 146.6 | |||||||||
| Adjusted income from continuing operations per diluted share | $ | 0.19 | $ | 0.71 | |||||||
| Year Ended | |||||||||||
| (Dollar amounts in millions, except per share amounts) | December 31, 2018 | December 31, 2017 | |||||||||
| Net income | $ | 394.6 | $ | 389.8 | |||||||
| Add (deduct): | |||||||||||
| Loss from discontinued operations | 4.2 | 1.3 | |||||||||
| Loss on sale or impairment of long-lived assets, net | 10.8 | 6.8 | |||||||||
| Other operating credits and charges, net | (2.2 | ) | 4.9 | ||||||||
| Reported tax provision | 122.3 | 119.1 | |||||||||
| Normalized tax provision at 25% for 2018 and 35% for 2017 | (132.4 | ) | (182.7 | ) | |||||||
| Adjusted income from continuing operations | $ | 397.3 | $ | 339.2 | |||||||
| Diluted shares outstanding | 144.4 | 146.4 | |||||||||
| Adjusted income from continuing operations per diluted share | $ | 2.75 | $ | 2.32 | |||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20190213005241/en/
Source:
Mark Morrison (Media Relations)
615.986.5886
Becky Barckley/Mike Kinney (Investor Relations)
615.986.5600