LP Reports First Quarter Results
PORTLAND, Ore.--(BUSINESS WIRE)--April 24, 2001--Louisiana-Pacific Corp. (NYSE:LPX) today reported a first quarter net loss, excluding unusual items, of $81.9 million, or $0.78 per diluted share, on sales of $559 million.
Including unusual items, first quarter results were a loss of $89.4 million, or $0.86 per diluted share. In the first quarter of 2000, net income excluding unusual items was $57 million, or $0.54 per diluted share, on sales of $830 million. Including unusual items, first quarter 2000 income was $58 million, or $0.55 per diluted share.
The tax benefit rate applied to the first quarter 2001 loss was 20 percent. This rate is lower than the statutory rate due to estimated annual earnings levels, the non-deductibility of goodwill and the anticipated expiration of unused Canadian investment tax credit carry-forwards.
"Near-record low pricing for lumber and panel products and sharply higher energy costs continue to negatively impact results," said Mark A. Suwyn, LP's chairman and CEO. "We've taken aggressive action to control costs tightly across all business lines, continue to meet the needs of key customers, keep product and supply inventories low and increase our operational efficiency."
Suwyn noted that, as part of the company's efforts to deal with low prices, total North American employee headcount has declined by more than 15 percent since last summer. Selling and administrative costs have declined by 25 percent since the first quarter of 2000. Capital expenditures in the first quarter were held to $15 million, or about 30 percent of depreciation, depletion and amortization for the quarter. Suwyn indicated that the company will continue to curtail operations that are not generating cash or to adjust production to customer demand.
"Although the regular seasonal improvement in demand and pricing has not yet developed, home mortgage rates remain low and recent Federal Reserve actions to continue the lowering of interest rates are encouraging. Furthermore, some of the demand indicators, particularly home building backlogs and retail activity, remain strong," said Suwyn. "We are positioning the company today to take full advantage of market conditions once they improve."
LP is a premier supplier of building materials, delivering innovative, high-quality commodity and specialty products to its rapidly growing retail, wholesale, homebuilding and industrial customers. For more information about LP, visit the company's website at www.lpcorp.com. Forward Looking Statements
This news release contains statements concerning Louisiana-Pacific Corporation's (LP) future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the effect of general economic conditions, including the level of interest rates and housing starts, market demand for the company's products, and prices for structural products; the effect of forestry, land use, environmental and other governmental regulations; the ability to obtain regulatory approvals, and the risk of losses from fires, floods and other natural disasters. These and other factors that could cause or contribute to actual results differing materially from such forward-looking statements are discussed in greater detail in the company's Securities and Exchange Commission filings.
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
FINANCIAL AND QUARTERLY DATA
(Dollar amounts in millions, except per share amounts) (Unaudited)
Three Months Ended
March 31,
------------------
2001 2000
-------- -------
Net sales $ 558.5 $829.7
Income (loss) before taxes, minority interest and
equity in earnings of unconsolidated affiliate $(108.6) $ 96.7
Net income (loss) $ (89.4) $ 57.7
Income (loss) excluding unusual items $ (81.9) $ 56.7
Net income (loss) per share - basic and diluted $ ( 0.86) $ 0.55
Income (loss) per share excluding unusual items $ ( 0.78) $ 0.54
Average shares outstanding - basic and diluted 104.4 104.1
SALES BY QUARTER
1st 2nd 3rd 4th
------- ------- ------- -------
2000 $829.7 $831.5 $702.7 $568.9
2001 $558.5
NET INCOME (LOSS) BY QUARTER
1st 2nd 3rd 4th
------- ------- ------- -------
2000 $57.7 $21.0 ($40.9) ($51.6)
2001 ($89.4)
NET INCOME (LOSS) PER SHARE BY QUARTER - BASIC AND DILUTED
1st 2nd 3rd 4th
------- ------- ------- -------
2000 $0.55 $0.20 ($0.39) ($0.50)
2001 ($0.86)
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
NOTES TO FINANCIAL DATA
(Dollar amounts in millions, except per share amounts) (Unaudited)
1. All sales figures have been reclassified to conform with
EITF 00-10 "Accounting for Shipping and Handling Costs."
2. Results of operations for interim periods are not necessarily
indicative of results to be expected for an entire year.
3. Unusual Credits and Charges, Net:
In the first quarter of 2000, LP recorded a $5.0 million
($3.1 million after taxes, or $0.03 per diluted share) gain on an
insurance recovery for siding related matters and an impairment
charge of $3.4 million ($2.1 million after taxes, or $0.02 per
diluted share) to reduce the carrying value of a manufacturing
facility to its estimated net realizable value.
In the second quarter of 2000, LP recorded a net loss of
$38 million ($22.7 million after taxes, or $.21 per diluted share)
primarily related to an impairment charge to reduce the carrying
value of the Samoa pulp mill to its estimated net realizable
value, an impairment charge at an MDF facility, a mark to market
charge on an interest rate hedge and a gain on an insurance
recovery for siding related matters.
In the third quarter of 2000, LP recorded a gain on an insurance
recovery of $10.6 million ($6.4 million after taxes, or $.06 per
diluted share) related to the 1999 fire at the Athens, Georgia OSB
facility. LP also recorded unusual gains on the sales of the
Mellen, Wisconsin veneer facilities and a former plant site in
California that totaled $6.1 million ($3.7 million after taxes, or
$.03 per diluted share). In addition, LP recorded unusual charges
relating to the settlement of an interest rate hedge, additional
environmental reserves for sites in Quebec that were acquired in
1999, additional reserves for non-product litigation and
impairment charges relating to several facilities which will be
permanently closed totaling $17.8 million ($10.7 million after
taxes, or $.10 per diluted share).
In the fourth quarter of 2000, LP recorded a net loss of
$15.4 million ($9.4 million after taxes, or $.09 per share)
associated with the permanent closure or planned sale of several
high-cost non-competitive mills. Additionally, LP recorded
impairment charges of $15.4 million ($9.4 million after taxes, or
$.09 per share) related to other assets held. LP also recorded
$2.3 million ($1.3 million after taxes, or $.01 per share) of
severance charges related to a reorganization of administrative
functions.
Also in the fourth quarter, LP recognized a loss of $5.3 million
($3.3 million after taxes, or $.04 per share) associated with its
share of restructuring charges at GreenFiber, the joint venture
between LP and Casella Waste Systems, Inc. This loss is reported
on the line item "Equity in (income) loss of unconsolidated
subsidiary" in LP's income statement.
In the first quarter of 2001, LP recorded a net loss of
$10.2 million ($6.2 million after taxes, or $.06 per diluted
share) associated with impairment charges on assets held. LP also
recorded a net loss of $2 million (1.2 million after taxes, or
$.01 per diluted share) for additional reserves for non-product
litigation.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
(Dollar amounts in millions, except per share amounts) (Unaudited)
Three Months Ended
March 31,
------------------
2001 2000
-------- --------
Net sales $ 558.5 $ 829.7
-------- --------
Operating costs and expenses:
Cost of sales 549.2 605.2
Depreciation, amortization and depletion 49.1 61.3
Selling and administrative 43.6 58.3
Unusual credits and charges, net 12.2 (1.6)
Loss related to assets and liabilities
transferred under contractual arrangement 4.5 -
-------- --------
Total operating costs and expenses 658.6 723.2
-------- --------
Income (loss) from operations (100.1) 106.5
-------- --------
Non-operating income (expense):
Interest expense (23.3) (17.1)
Interest income 8.2 8.7
Foreign exchange gains (losses) 2.1 (1.4)
-------- --------
Total non-operating income (expense) (13.0) (9.8)
-------- --------
Income (loss) before taxes, minority interest
and equity in earnings of unconsolidated
affiliate (113.1) 96.7
Provision (benefit) for income taxes (22.4) 38.5
Minority interest in net income (loss) of
consolidated subsidiaries (1.3) 0.5
Equity in (income) loss of unconsolidated
subsidiary - -
-------- --------
Net income (loss) $ (89.4) $ 57.7
======== ========
Net income (loss) per share - basic and diluted $ ( 0.86) $ 0.55
======== ========
Average share outstanding -
basic and diluted 104.4 104.1
======== ========
Cash dividends per share $ 0.14 $ 0.14
======== ========
CONDENSED CONSOLIDATED BALANCE SHEETS
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
(Dollar amounts in millions) (Unaudited)
March 31, Dec. 31,
2001 2000
---------- ----------
ASSETS
Cash and cash equivalents $ 27.4 $ 38.1
Accounts receivable, net 161.2 129.6
Inventories 252.2 327.5
Prepaid expenses 17.4 22.8
Income taxes receivable 61.4 91.5
Deferred income taxes 44.6 44.6
---------- ----------
Total current assets 564.2 654.1
Timber and timberlands 584.1 590.6
Property, plant and equipment 2,418.2 2,562.8
Accumulated depreciation (1,182.7) (1,254.0)
---------- ----------
Net property, plant and equipment 1,235.5 1,308.8
Goodwill, net of amortization 319.5 326.3
Notes receivable from asset sales 403.8 403.8
Assets transferred under
contractual arrangement 67.6 -
Other assets 84.1 91.1
---------- ----------
Total assets $ 3,258.8 $ 3,374.7
========== ==========
LIABILITIES AND EQUITY
Current portion of long-term debt $ 162.2 $ 39.4
Accounts payable and accrued liabilities 253.2 303.8
Income taxes payable - -
Current portion of contingency reserves 35.0 35.0
---------- ----------
Total current liabilities 450.4 378.2
Long-term debt, excluding current portion:
Limited recourse notes payable 396.5 396.5
Other long term debt 676.4 787.3
---------- ----------
Total long-term debt,
excluding current portion 1,072.9 1,183.8
Contingency reserves,
excluding current portion 124.9 126.6
Liabilities transferred
under contractual arrangement 30.0 -
Deferred income taxes and other 387.2 390.9
Commitments and contingencies
Stockholders' equity:
Common stock 117.0 117.0
Additional paid-in capital 440.1 440.2
Retained earnings 900.2 1,004.3
Treasury stock (234.1) (235.1)
Accumulated comprehensive loss (29.8) (31.2)
---------- ----------
Total stockholders' equity 1,193.4 1,295.2
---------- ----------
Total liabilities and equity $ 3,258.8 $ 3,374.7
========== ==========
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
(Dollar amounts in millions) (Unaudited)
Three Months Ended
March 31,
------------------
2001 2000
------- -------
Cash flows from operating activities:
Net income (loss) $(89.4) $ 57.7
Depreciation, amortization and depletion 49.1 61.3
Unusual credits and charges, net 12.2 3.5
Cash settlements of contingencies (1.9) (4.0)
Other adjustments 3.1 7.1
Decrease (increase) in certain working
capital components and deferred taxes 9.5 (72.1)
------- -------
Net cash provided by (used in)operating activities (17.4) 53.5
Cash flows from investing activities:
Capital spending (15.1) (41.7)
Proceeds from assets sales and transfers 24.5 -
Other investing activities, net 0.1 6.3
------- -------
Net cash provided by (used in) investing activities 9.5 (35.4)
Cash flows from financing activities:
New borrowings, including net increase
in revolving borrowings 15.1 -
Repayment of long-term debt (3.2) (3.6)
Cash dividends (14.7) (14.7)
Purchase of treasury stock - (11.2)
Other financing activities 0.3 1.2
------- -------
Net cash used in financing activities (2.5) (28.3)
Net decrease in cash and cash equivalents (10.4) (10.2)
Cash and cash equivalents at beginning of period 38.1 116.0
------- -------
Cash and cash equivalents at end of period $ 27.7 $105.8
======= =======
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
SELECTED SEGMENT INFORMATION
(Dollar amounts in millions) (Unaudited)
Three Months Ended March 31,
-----------------------------
2001 2000 % change
--------- -------- --------
Net sales:
Structural products $ 344.3 $ 532.0 (35)
Exterior products 69.6 70.5 (1)
Industrial panel products 53.2 81.4 (35)
Other products 58.5 102.7 (43)
Pulp 32.9 43.1 (24)
--------- --------
$ 558.5 $ 829.7 (33)
========= ========
Operating profit (loss):
Structural products $ (30.9) $ 114.0 (127)
Exterior products (4.3) 8.1 (153)
Industrial panel products (6.9) 2.6 (365)
Other products (2.1) 0.8 (363)
Pulp (12.8) 4.4 (391)
Unusual credits and charges, net (12.2) 1.6 (863)
Loss from assets and liabilities
transferred under contractual
arrangement (4.5) - -
General corporate and other expenses, net (24.4) (26.4) 8
Interest income (expense), net (15.0) (8.4) (79)
--------- --------
Income (loss) before taxes, minority
interest and equity in earnings of
unconsolidated affiliates $(113.1) $ 96.7 (217)
========= ========
LOUISIANA-PACIFIC CORPORATION
SUMMARY OF PRODUCTION VOLUMES
Three Months Ended
March 31,
---------------------
2001 2000
------ ------
Oriented strand board, million
square feet 3/8" basis 1,293 1,357
Softwood plywood, million
square feet 3/8" basis 207 268
Lumber, million board feet 229 264
Wood-based siding, million square feet
3/8" basis 229 179
Industrial panel products (particleboard,
medium density fiberboard and hardboard),
million square feet 3/4" basis 131 164
Engineered I-Joist, million lineal feet 14 24
Laminated veneer lumber (LVL),
thousand cubic feet 1,700 2,150
Pulp, thousand short tons 51 99
CONTACT:
Louisiana-Pacific Corp.
Kelly Stoner, 503/821-5281 (Media Relations)
Bill Hebert, 503/221-0800 (Investor Relations)
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