United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM 8-K
__________________________________
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: August 4, 2016
Commission File Number 1-7107
__________________________________
LOUISIANA-PACIFIC CORPORATION
(Exact name of registrant as specified in its charter)
__________________________________
DELAWARE | 1-7107 | 93-0609074 | ||
(State or other jurisdiction of incorporation or organization) | Commission File Number | (IRS Employer Identification No.) | ||
414 Union Street, Suite 2000, Nashville, TN 37219
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (615) 986-5600
__________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
å | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
å | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
å | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
å | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition
The information in this item and Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3, attached hereto, is being furnished to the Securities and Exchange Commission and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
On August 4, 2016, Louisiana - Pacific Corporation issued a press release announcing financial results for the quarter and six months ended June 30, 2016, a copy of which is attached hereto as Exhibit 99.1 and incorporated by reference.
In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (“GAAP”), the attached press release discloses continuing earnings before interest expense, taxes, depreciation and amortization (“EBITDA”) which is a non-GAAP financial measure. Additionally, it discloses Adjusted EBITDA from continuing operations which further adjusts EBITDA to exclude stock based compensation expense, (gain) loss on sales or impairment of long lived assets, other operating charges and credits, and investment income. It also discloses adjusted income (loss) which excludes (gain) loss on sale or impairment of long-lived assets, other operating credits and charges, net, and adjusts for a normalized tax rate. EBITDA, Adjusted EBITDA from continuing operations and adjusted income (loss) 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. A copy of the reconciliation of adjusted income(loss), EBITDA and Adjusted EBITDA for the quarter and six months ended June 30, 2016 and 2015 is attached hereto as Exhibit 99.2 and Exhibit 99.3 and incorporated herein by reference.
We have EBITDA and Adjusted EBITDA from continuing operations in the press release because we use them as important supplemental measures 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. We use EBITDA and Adjusted EBITDA from continuing operations to evaluate our performance as compared to other companies in our 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 us may not be comparable to similarly-titled measures reported by other companies. In addition, 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 we otherwise incurred or experienced in connection with the operation of our business.
We believe that adjusted income (loss) which excludes (gain) loss on sale or impairment of long-lived assets, other operating credits and charges, net, 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. We believe 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 us 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 our business.
Item 9.01 Financial Statements, Pro Forma Financial Statements and Exhibits.
Exhibit Number | Description |
99.1 | Press release issued by Louisiana-Pacific Corporation on August 4, 2016, regarding financial results for the quarter and six months ended June 30, 2016. |
99.2 | Reconciliation of Adjusted operating income from operations and EBITDA and Adjusted EBITDA from continuing operations for the quarter and six months ended June 30, 2016 and 2015. |
99.3 | Reconciliation of Adjusted operating income from operations for the quarter and six months ended June 30, 2016 and 2015 and for the quarter ended March 31, 2016. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
LOUISIANA-PACIFIC CORPORATION | ||
By: | /S/ SALLIE B. BAILEY | |
Sallie B. Bailey | ||
Executive Vice President and Chief | ||
Financial Officer | ||
(Principal Financial Officer) | ||
Date: August 4, 2016
LP Reports Second Quarter 2016 Results
Louisiana-Pacific Corporation (LP) (NYSE: LPX) reported results today for the second quarter of 2016, which included the following:
• | Sales for the second quarter of $582 million were higher by 18 percent compared to the year ago quarter. |
• | Income from continuing operations was $32 million ($0.22 per diluted share). |
• | Non-GAAP adjusted income from operations was $40 million ($0.28 per diluted share). |
• | Adjusted EBITDA from operations for the second quarter was $99 million compared to $16 million in the second quarter of 2015. |
• | Cash and cash equivalents were $475 million as of June 30, 2016. |
“This was an outstanding quarter for LP as every one of our segments helped drive net income of over $30 million,” Said Curt Stevens, Chief Executive Officer. “OSB had adjusted EBITDA of $59 million and our Siding segment had nearly $50 million of adjusted EBITDA. These results were due to higher OSB pricing, slightly improved housing starts and lower production costs across our system.”
SECOND QUARTER RESULTS
For the second quarter of 2016, LP reported net income of $32 million, or $0.22 per diluted share, as compared to a net loss of $20 million, or $0.14 per diluted share for the second quarter of 2015.
YEAR TO DATE RESULTS
For the six months ended June 30, 2016, LP reported net sales of $1.1 billion compared to $1.0 billion in the first six months of 2015. For the first six months of 2016, LP reported net income of $42 million, or $0.29 per diluted share, compared to loss of $54 million, or $0.38 per diluted share, for the same period in 2015. Adjusted EBITDA from continuing operations for the the first six months of 2016 was $151 million compared to $22 million for 2015. Increases in OSB pricing sold in North America accounted for $87 million increase in both operating results and adjusted EBITDA.
ORIENTED STRAND BOARD (OSB) SEGMENT
LP's OSB segment manufactures and distributes OSB structural panel products. The OSB segment reported net sales for the second quarter of 2016 of $253 million, a $42 million increase from $211 million of net sales in the second quarter of 2015. For the second quarter of 2016, the OSB segment reported operating income of $44 million compared to operating loss of $18 million in the second quarter of 2015. For the second quarter of 2016, adjusted EBITDA from
continuing operations for this segment increased by $63 million compared to the second quarter of 2015. For the second quarter of 2016 as compared to second quarter of 2015, sales volumes were up 7% and sales prices increased by 30 percent. The increase in selling price favorably impacted operating results and adjusted EBITDA from continuing operations by approximately $59 million for the quarter as compared to the second quarter of 2015.
For the first six months, OSB reported sales of $470 million, up 17% from the prior year and had an operating income of $59 million compared to an operating loss of $47 million in 2015. Adjusted EBITDA for the first six months of 2016 was positive $89 million compared to negative $17 million in 2015. For the first six months, sales volumes decreased 4% and sales prices increased 22%. The increase in selling price favorably impacted operating results and adjusted EBITDA from continuing operations by approximately $86 million for the first six months as compared to 2015.
SIDING SEGMENT
LP's Siding segment consists of SmartSide siding as well as LP's prefinished CanExel siding line. These products are used in new construction, repair and remodeling and non-residential markets. The Siding segment reported net sales of $207 million in the second quarter of 2016, an increase of $43 million from $164 million in the year-ago second quarter. For the second quarter of 2016, the Siding segment reported operating income of $42 million compared to $29 million in the year-ago quarter. For the second quarter of 2016, the Siding segment reported $49 million in adjusted EBITDA from continuing operations, an increase of $15 million compared to the second quarter of 2015.
For the first six months, Siding reported sales of $389 million, up 15% from the prior year and had an operating income of $69 million compared to an operating income of $62 million in 2015. Adjusted EBITDA for the first six month of 2016 was positive $84 million compared to $73 million in 2015.
ENGINEERED WOOD PRODUCTS SEGMENT (EWP)
The EWP segment is comprised of I-Joist (IJ), Laminated Veneer Lumber and Laminated Strand Lumber (LVL and LSL). EWP reported net sales in the second quarter of 2016 totaled $78 million, up 8 percent from the year-ago quarter. Operating income increased to $1 million for the second quarter of 2016 from a $2 million loss in the second quarter of 2015. For the second quarter, the EWP segment showed an increase of $3 million in adjusted EBITDA from continuing operations as compared to the same quarter in 2015.
For the first six months, EWP reported sales of $150 million, up 10% from the prior year and had an operating loss of $2 million compared to an operating loss of $6 million in 2015. Adjusted EBITDA for the first six months of 2016 was positive $5 million compared to breakeven in 2015.
SOUTH AMERICA SEGMENT
The South American segment consists of facilities in Chile and Brazil. The segment reported net sales in the second quarter of 2016 of $41 million, up $2 million from $39 million in the second quarter of 2015. Operating income was $7 million for the second quarter of 2016 compared to $2 million in the second quarter of 2015. For the second quarter, LP reported adjusted EBITDA from continuing operations in this segment of $9 million, an increase of $5 million as compared to the second quarter of 2015.
For the first six months, South America reported sales of $72 million, down 4% from the prior year and had an operating income of $12 million compared to $4 million in 2015. Adjusted EBITDA for the first six months of 2016 was positive $16 million compared to $9 million in 2015.
COMPANY OUTLOOK
“While I now expect 2016 housing starts to be up less than 10% over last year, this muted recovery actually bodes well for the future as there will likely be a long period of improving housing activity,” continued Stevens. "With our broad portfolio of commodity and value-added products, LP is in an excellent position to capitalize on growth in housing starts, repair / remodel activity, retail and industrial markets.”
LP is a premier supplier of building materials, delivering innovative, high-quality commodity and specialty products to its retail, wholesale, homebuilding and industrial customers. Visit LP's web site at www.lpcorp.com for additional information on the company as well as reconciliation of non-GAAP results.
###
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 matters addressed in these statements are 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 availability, cost and other terms of capital; the efficiency and consequences of operations improvement initiatives and cash conservation measures; 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 those contemplated by 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 June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net sales | $ | 582.4 | $ | 493.0 | $ | 1,087.0 | $ | 964.7 | |||||||
Income (loss) from operations | $ | 52.2 | $ | (14.1 | ) | $ | 71.1 | $ | (47.3 | ) | |||||
Income (loss) before taxes and equity in income of unconsolidated affiliates | $ | 46.4 | $ | (19.9 | ) | $ | 59.6 | $ | (61.4 | ) | |||||
Non-GAAP adjusted net income (loss) | $ | 40.0 | $ | (11.7 | ) | 49.5 | $ | (30.6 | ) | ||||||
Net income (loss) | $ | 31.7 | $ | (19.5 | ) | $ | 42.0 | $ | (54.0 | ) | |||||
Net loss per share - basic and diluted | $ | 0.22 | $ | (0.14 | ) | $ | 0.29 | $ | (0.38 | ) | |||||
Average shares of stock outstanding - basic | 143.4 | 142.3 | 143.1 | 142.1 | |||||||||||
Average shares of stock outstanding - diluted | 145.2 | 142.3 | 145.1 | 142.1 | |||||||||||
CONSOLIDATED STATEMENTS OF INCOME
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
(Dollar amounts in millions, except per share amounts) (Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
Net sales | $ | 582.4 | $ | 493.0 | $ | 1,087.0 | $ | 964.7 | |||||||
Operating costs and expenses: | |||||||||||||||
Cost of sales | 443.1 | 443.4 | 858.6 | 871.2 | |||||||||||
Depreciation and amortization | 28.5 | 25.3 | 56.4 | 52.0 | |||||||||||
Selling and administrative | 46.5 | 37.9 | 88.8 | 76.6 | |||||||||||
Loss on sale or impairment of long-lived assets, net | 0.7 | 0.5 | 0.7 | 0.6 | |||||||||||
Other operating credits and charges, net | 11.4 | — | 11.4 | 11.6 | |||||||||||
Total operating costs and expenses | 530.2 | 507.1 | 1,015.9 | 1,012.0 | |||||||||||
Income (loss) from operations | 52.2 | (14.1 | ) | 71.1 | (47.3 | ) | |||||||||
Non-operating income (expense): | |||||||||||||||
Interest expense, net of capitalized interest | (9.3 | ) | (7.2 | ) | (17.3 | ) | (14.7 | ) | |||||||
Interest income | 2.1 | 1.0 | 3.9 | 2.4 | |||||||||||
Other non-operating items | 1.4 | 0.4 | 1.9 | (1.8 | ) | ||||||||||
Total non-operating income (expense) | (5.8 | ) | (5.8 | ) | (11.5 | ) | (14.1 | ) | |||||||
Income (loss) before taxes and equity in income of unconsolidated affiliates | 46.4 | (19.9 | ) | 59.6 | (61.4 | ) | |||||||||
Provision (benefit) for income taxes | 16.2 | 1.0 | 20.6 | (5.3 | ) | ||||||||||
Equity in income of unconsolidated affiliates | (1.5 | ) | (1.4 | ) | (3.0 | ) | (2.1 | ) | |||||||
Net income (loss) | $ | 31.7 | $ | (19.5 | ) | $ | 42.0 | $ | (54.0 | ) | |||||
Income (loss) per share of common stock: | |||||||||||||||
Net income (loss) per share - basic | $ | 0.22 | $ | (0.14 | ) | $ | 0.29 | $ | (0.38 | ) | |||||
Net income (loss) per share - diluted | $ | 0.22 | $ | (0.14 | ) | $ | 0.29 | $ | (0.38 | ) | |||||
Average shares of stock outstanding - basic | 143.4 | 142.3 | 143.1 | 142.1 | |||||||||||
Average shares of stock outstanding - diluted | 145.2 | 142.3 | 145.1 | 142.1 | |||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
(Dollar amounts in millions) (Unaudited)
June 30, 2016 | December 31, 2015 | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 474.8 | $ | 434.7 | |||
Receivables, net of allowance for doubtful accounts of $1.1 million at June 30, 2016 and December 31, 2015 | 151.4 | 96.4 | |||||
Inventories | 231.6 | 222.0 | |||||
Prepaid expenses and other current assets | 9.3 | 7.0 | |||||
Assets held for sale | 9.0 | 9.0 | |||||
Total current assets | 876.1 | 769.1 | |||||
Timber and timberlands | 51.0 | 53.1 | |||||
Property, plant and equipment, at cost | 2,434.7 | 2,392.5 | |||||
Accumulated depreciation | (1,579.3 | ) | (1,530.1 | ) | |||
Net property, plant and equipment | 855.4 | 862.4 | |||||
Goodwill | 9.7 | 9.7 | |||||
Notes receivable from asset sales | 432.2 | 432.2 | |||||
Investments in and advances to affiliates | 7.4 | 7.7 | |||||
Restricted cash | 15.0 | 14.3 | |||||
Other assets | 22.9 | 23.0 | |||||
Long-term deferred tax asset | 4.2 | 4.8 | |||||
Total assets | $ | 2,273.9 | $ | 2,176.3 | |||
LIABILITIES AND EQUITY | |||||||
Current portion of long-term debt | $ | 2.1 | $ | 2.1 | |||
Accounts payable and accrued liabilities | 173.5 | 139.6 | |||||
Current portion of contingency reserves | 1.3 | 1.3 | |||||
Total current liabilities | 176.9 | 143.0 | |||||
Long-term debt, excluding current portion | 745.2 | 751.8 | |||||
Deferred income taxes | 97.6 | 99.5 | |||||
Contingency reserves, excluding current portion | 14.9 | 15.5 | |||||
Other long-term liabilities | 155.0 | 149.5 | |||||
Stockholders’ equity: | |||||||
Common stock | 153.1 | 153.0 | |||||
Additional paid-in capital | 475.2 | 496.5 | |||||
Retained earnings | 782.5 | 724.2 | |||||
Treasury stock | (191.4 | ) | (210.6 | ) | |||
Accumulated comprehensive loss | (135.1 | ) | (146.1 | ) | |||
Total stockholders’ equity | 1,084.3 | 1,017.0 | |||||
Total liabilities and stockholders’ equity | $ | 2,273.9 | $ | 2,176.3 | |||
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
(Dollar amounts in millions) (Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||||
Net income (loss) | $ | 31.7 | $ | (19.5 | ) | $ | 42.0 | $ | (54.0 | ) | |||||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||
Depreciation and amortization | 28.5 | 25.3 | 56.4 | 52.0 | |||||||||||
Equity in income from unconsolidated affiliates, including dividends | (0.2 | ) | (1.4 | ) | 0.3 | (2.1 | ) | ||||||||
Loss on sale or impairment of long-lived assets, net | 0.7 | 0.5 | 0.7 | 0.6 | |||||||||||
Other operating credits and charges, net | 11.4 | — | 11.4 | 11.6 | |||||||||||
Stock-based compensation related to stock plans | 3.2 | 2.7 | 6.2 | 5.1 | |||||||||||
Exchange (gain) loss on remeasurement | (0.8 | ) | 0.7 | (0.7 | ) | 4.3 | |||||||||
Cash settlements of contingencies, net of accruals | (0.4 | ) | — | (0.7 | ) | 0.5 | |||||||||
Cash settlements of warranties, net of accruals | (3.3 | ) | (2.4 | ) | (6.8 | ) | (5.4 | ) | |||||||
Pension expense, net of contributions | 1.0 | 2.4 | 1.4 | 4.4 | |||||||||||
Non-cash interest (income) expense, net | (0.2 | ) | (0.1 | ) | 0.2 | (0.1 | ) | ||||||||
Other adjustments, net | — | 0.6 | — | 0.8 | |||||||||||
Changes in assets and liabilities: | |||||||||||||||
(Increase) decrease in receivables | (3.3 | ) | 14.3 | (51.1 | ) | (16.6 | ) | ||||||||
(Increase) decrease in inventories | 18.9 | 37.3 | (8.0 | ) | 3.1 | ||||||||||
(Increase) decrease in prepaid expenses | (3.7 | ) | (1.2 | ) | (2.6 | ) | 0.8 | ||||||||
Increase (decrease) in accounts payable and accrued liabilities | 10.3 | (21.4 | ) | 36.3 | (4.2 | ) | |||||||||
Increase (decrease) in income taxes | 9.9 | 3.7 | 13.8 | (3.3 | ) | ||||||||||
Increase in other liabilities | 5.4 | — | 5.4 | — | |||||||||||
Net cash provided by (used in) operating activities | 109.1 | 41.5 | 104.2 | (2.5 | ) | ||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||||
Property, plant and equipment additions | (24.8 | ) | (18.6 | ) | (51.1 | ) | (33.5 | ) | |||||||
Proceeds from sales of assets | 0.1 | — | 0.1 | 0.4 | |||||||||||
Increase in restricted cash under letters of credit/credit facility | (0.3 | ) | (5.4 | ) | (0.3 | ) | (5.4 | ) | |||||||
Other financing activities | (0.3 | ) | — | (0.2 | ) | — | |||||||||
Net cash used in investing activities | (25.3 | ) | (24.0 | ) | (51.5 | ) | (38.5 | ) | |||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||||
Repayment of long-term debt | (6.8 | ) | — | (7.9 | ) | (1.4 | ) | ||||||||
Sale of common stock, net of cash payments under equity plans | (0.2 | ) | 0.3 | (0.1 | ) | 0.4 | |||||||||
Taxes paid related to net share settlement of equity awards | (7.2 | ) | (2.9 | ) | (8.1 | ) | (5.3 | ) | |||||||
Net cash used in financing activities | (14.2 | ) | (2.6 | ) | (16.1 | ) | (6.3 | ) | |||||||
EFFECT OF EXCHANGE RATE ON CASH AND CASH EQUIVALENTS | 1.0 | (2.2 | ) | 3.5 | (4.4 | ) | |||||||||
Net increase (decrease) in cash and cash equivalents | 70.6 | 12.7 | 40.1 | (51.7 | ) | ||||||||||
Cash and cash equivalents at beginning of period | 404.2 | 468.3 | 434.7 | 532.7 | |||||||||||
Cash and cash equivalents at end of period | $ | 474.8 | $ | 481.0 | $ | 474.8 | $ | 481.0 | |||||||
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
SELECTED SEGMENT INFORMATION
(Dollar amounts in millions) (Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Dollar amounts in millions | 2016 | 2015 | 2016 | 2015 | |||||||||||
Net sales: | |||||||||||||||
OSB | $ | 252.8 | $ | 211.0 | $ | 469.8 | $ | 401.2 | |||||||
Siding | 207.2 | 163.9 | 388.5 | 337.4 | |||||||||||
EWP | 78.0 | 72.0 | 149.8 | 136.8 | |||||||||||
South America | 41.0 | 38.7 | 71.5 | 74.6 | |||||||||||
Other | 6.6 | 7.4 | 12.7 | 14.7 | |||||||||||
Intersegment sales | (3.2 | ) | — | (5.3 | ) | — | |||||||||
$ | 582.4 | $ | 493.0 | $ | 1,087.0 | $ | 964.7 | ||||||||
Operating profit (loss): | |||||||||||||||
OSB | $ | 44.0 | $ | (18.1 | ) | $ | 59.3 | $ | (46.5 | ) | |||||
Siding | 41.8 | 29.2 | 68.7 | 62.1 | |||||||||||
EWP | 0.5 | (2.3 | ) | (2.0 | ) | (6.4 | ) | ||||||||
South America | 6.9 | 2.0 | 12.0 | 4.4 | |||||||||||
Other | (0.2 | ) | (1.0 | ) | (0.6 | ) | (1.9 | ) | |||||||
Other operating credits and charges, net | (11.4 | ) | — | (11.4 | ) | (11.6 | ) | ||||||||
Loss on sale or impairment of long-lived assets, net | (0.7 | ) | (0.5 | ) | (0.7 | ) | (0.6 | ) | |||||||
General corporate and other expenses, net | (27.2 | ) | (22.0 | ) | (51.2 | ) | (44.7 | ) | |||||||
Other non-operating income (expense) | 1.4 | 0.4 | 1.9 | (1.8 | ) | ||||||||||
Investment income | 2.1 | 1.0 | 3.9 | 2.4 | |||||||||||
Interest expense, net of capitalized interest | (9.3 | ) | (7.2 | ) | (17.3 | ) | (14.7 | ) | |||||||
Income (loss) from operations before taxes | 47.9 | (18.5 | ) | 62.6 | (59.3 | ) | |||||||||
Provision (benefit) for income taxes | 16.2 | 1.0 | 20.6 | (5.3 | ) | ||||||||||
Net income (loss) | $ | 31.7 | $ | (19.5 | ) | $ | 42.0 | $ | (54.0 | ) | |||||
LOUISIANA-PACIFIC CORPORATION AND SUBSIDIARIES
SUMMARY OF PRODUCTION VOLUMES (1)
The following table sets forth production volumes for the six months ended June 30, 2016 and 2015.
Three Months Ended | Six Months Ended | ||||||||||
June 30, | June 30, | ||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||
Oriented strand board, million square feet 3/8" basis(1) | 1,095 | 1,089 | 2,146 | 2,093 | |||||||
Oriented strand board, million square feet 3/8" basis (produced by North America non-OSB segment mills) | 63 | 6 | 126 | 16 | |||||||
Wood-based siding, million square feet 3/8" basis | 354 | 319 | 685 | 630 | |||||||
Engineered I-Joist, million lineal feet(1) | 21 | 20 | 39 | 35 | |||||||
Laminated veneer lumber (LVL), thousand cubic feet(1) and laminated strand lumber (LSL), thousand cubic feet | 2,577 | 2,121 | 5,106 | 4,485 | |||||||
(1) Includes volumes produced by joint venture operations or under sales arrangements and sold to LP.
Exhibit 99.2 Reconciliation of EBITDA from continuing operations and Adjusted EBITDA from continuing operations for the quarter and six months ended June 30, 2016 and 2015.
Three Months Ended June 30, 2016 (Dollar amounts in millions) | OSB | Siding | EWP | South America | Other | Corporate | Total | ||||||||||||||||||||
Net Sales | $ | 252.8 | $ | 207.2 | $ | 78.0 | $ | 41.0 | $ | 6.6 | $ | (3.2 | ) | $ | 582.4 | ||||||||||||
Depreciation and amortization | 14.7 | 7.3 | 3.2 | 2.2 | 0.4 | 0.7 | 28.5 | ||||||||||||||||||||
Cost of sales and selling and administrative | 194.1 | 158.1 | 75.8 | 31.9 | 6.4 | 23.3 | 489.6 | ||||||||||||||||||||
Loss on sale or impairment of long lived assets, net | — | — | — | — | — | 0.7 | 0.7 | ||||||||||||||||||||
Other operating credits and charges, net | — | — | — | — | — | 11.4 | 11.4 | ||||||||||||||||||||
Total operating costs | 208.8 | 165.4 | 79.0 | 34.1 | 6.8 | 36.1 | 530.2 | ||||||||||||||||||||
Income (loss) from operations | 44.0 | 41.8 | (1.0 | ) | 6.9 | (0.2 | ) | (39.3 | ) | 52.2 | |||||||||||||||||
Total non-operating expense | — | — | — | — | — | (5.8 | ) | (5.8 | ) | ||||||||||||||||||
Income (loss) before income taxes and equity in income of unconsolidated affiliates | 44.0 | 41.8 | (1.0 | ) | 6.9 | (0.2 | ) | (45.1 | ) | 46.4 | |||||||||||||||||
Income tax provision | — | — | — | — | — | 16.2 | 16.2 | ||||||||||||||||||||
Equity in income of unconsolidated affiliates | — | — | (1.5 | ) | — | — | — | (1.5 | ) | ||||||||||||||||||
Net income (loss) | $ | 44.0 | $ | 41.8 | $ | 0.5 | $ | 6.9 | $ | (0.2 | ) | $ | (61.3 | ) | $ | 31.7 | |||||||||||
Reconciliation of net income (loss) to adjusted EBITDA | |||||||||||||||||||||||||||
Net income (loss) | $ | 44.0 | $ | 41.8 | $ | 0.5 | $ | 6.9 | $ | (0.2 | ) | $ | (61.3 | ) | $ | 31.7 | |||||||||||
Income tax provision | — | — | — | — | — | 16.2 | 16.2 | ||||||||||||||||||||
Interest expense, net of capitalized interest | — | — | — | — | — | 9.3 | 9.3 | ||||||||||||||||||||
Depreciation and amortization | 14.7 | 7.3 | 3.2 | 2.2 | 0.4 | 0.7 | 28.5 | ||||||||||||||||||||
EBITDA | 58.7 | 49.1 | 3.7 | 9.1 | 0.2 | (35.1 | ) | 85.7 | |||||||||||||||||||
Stock based compensation expense | 0.3 | 0.1 | 0.2 | — | — | 2.6 | 3.2 | ||||||||||||||||||||
Gain on sale or impairment of long lived assets | — | — | — | — | — | 0.7 | 0.7 | ||||||||||||||||||||
Investment income | — | — | — | — | — | (2.1 | ) | (2.1 | ) | ||||||||||||||||||
Other operating credits and charges, net | — | — | — | — | — | 11.4 | 11.4 | ||||||||||||||||||||
Adjusted EBITDA | $ | 59.0 | $ | 49.2 | $ | 3.9 | $ | 9.1 | $ | 0.2 | $ | (22.5 | ) | $ | 98.9 | ||||||||||||
Three Months Ended June 30, 2015 (Dollar amounts in millions) | OSB | Siding | EWP | South America | Other | Corporate | Total | ||||||||||||||||||||
Net Sales | $ | 211.0 | $ | 163.9 | $ | 72.0 | $ | 38.7 | $ | 7.4 | $ | — | $ | 493.0 | |||||||||||||
Depreciation and amortization | 14.2 | 5.0 | 2.7 | 2.1 | 0.5 | 0.8 | 25.3 | ||||||||||||||||||||
Cost of sales and selling and administrative | 214.9 | 129.7 | 73.0 | 34.6 | 7.9 | 21.2 | 481.3 | ||||||||||||||||||||
Loss on sale or impairment of long lived assets, net | — | — | — | — | — | 0.5 | 0.5 | ||||||||||||||||||||
Total operating costs | 229.1 | 134.7 | 75.7 | 36.7 | 8.4 | 22.5 | 507.1 | ||||||||||||||||||||
Income (loss) from operations | (18.1 | ) | 29.2 | (3.7 | ) | 2.0 | (1.0 | ) | (22.5 | ) | (14.1 | ) | |||||||||||||||
Total non-operating expense | — | — | — | — | — | (5.8 | ) | (5.8 | ) | ||||||||||||||||||
Income (loss) before taxes and equity in income of unconsolidated affiliates | (18.1 | ) | 29.2 | (3.7 | ) | 2.0 | (1.0 | ) | (28.3 | ) | (19.9 | ) | |||||||||||||||
Income tax provision | — | — | — | — | — | 1.0 | 1.0 | ||||||||||||||||||||
Equity in income of unconsolidated affiliates | — | — | (1.4 | ) | — | — | — | (1.4 | ) | ||||||||||||||||||
Net income (loss) | $ | (18.1 | ) | $ | 29.2 | $ | (2.3 | ) | $ | 2.0 | $ | (1.0 | ) | $ | (29.3 | ) | $ | (19.5 | ) | ||||||||
Reconciliation of net income (loss) to adjusted EBITDA | |||||||||||||||||||||||||||
Net income (loss) | $ | (18.1 | ) | $ | 29.2 | $ | (2.3 | ) | $ | 2.0 | $ | (1.0 | ) | $ | (29.3 | ) | $ | (19.5 | ) | ||||||||
Income tax provision | — | — | — | — | — | 1.0 | 1.0 | ||||||||||||||||||||
Interest expense, net of capitalized interest | — | — | — | — | — | 7.2 | 7.2 | ||||||||||||||||||||
Depreciation and amortization | 14.2 | 5.0 | 2.7 | 2.1 | 0.5 | 0.8 | 25.3 | ||||||||||||||||||||
EBITDA | (3.9 | ) | 34.2 | 0.4 | 4.1 | (0.5 | ) | (20.3 | ) | 14.0 | |||||||||||||||||
Stock based compensation expense | 0.2 | 0.4 | 0.2 | — | — | 1.9 | 2.7 | ||||||||||||||||||||
Gain on sale or impairment of long lived assets | — | — | — | — | — | 0.5 | 0.5 | ||||||||||||||||||||
Investment income | — | — | — | — | — | (1.0 | ) | (1.0 | ) | ||||||||||||||||||
Adjusted EBITDA | $ | (3.7 | ) | $ | 34.6 | $ | 0.6 | $ | 4.1 | $ | (0.5 | ) | $ | (18.9 | ) | $ | 16.2 | ||||||||||
Six Months Ended June 30, 2016 (Dollar amounts in millions) | OSB | Siding | EWP | South America | Other | Corporate | Total | ||||||||||||||||||||
Sales | $ | 469.8 | $ | 388.5 | $ | 149.8 | $ | 71.5 | $ | 12.7 | $ | (5.3 | ) | $ | 1,087.0 | ||||||||||||
Depreciation and amortization | 29.2 | 14.5 | 6.3 | 4.1 | 0.8 | 1.5 | 56.4 | ||||||||||||||||||||
Cost of sales and selling and administrative | 381.3 | 305.3 | 148.5 | 55.4 | 12.5 | 44.4 | 947.4 | ||||||||||||||||||||
Gain on sale or impairment of long lived assets | — | — | — | — | — | 0.7 | 0.7 | ||||||||||||||||||||
Other operating credits and charges, net | — | — | — | — | — | 11.4 | 11.4 | ||||||||||||||||||||
Total operating costs | 410.5 | 319.8 | 154.8 | 59.5 | 13.3 | 58.0 | 1,015.9 | ||||||||||||||||||||
Income (loss) from operations | 59.3 | 68.7 | (5.0 | ) | 12.0 | (0.6 | ) | (63.3 | ) | 71.1 | |||||||||||||||||
Total non-operating expense | — | — | — | — | — | (11.5 | ) | (11.5 | ) | ||||||||||||||||||
Income (loss) before income taxes and equity in income of unconsolidated affiliates | 59.3 | 68.7 | (5.0 | ) | 12.0 | (0.6 | ) | (74.8 | ) | 59.6 | |||||||||||||||||
Income tax provision | — | — | — | — | — | 20.6 | 20.6 | ||||||||||||||||||||
Equity in income of unconsolidated affiliates | — | — | (3.0 | ) | — | — | — | (3.0 | ) | ||||||||||||||||||
Income (loss) from continuing operations | $ | 59.3 | $ | 68.7 | $ | (2.0 | ) | $ | 12.0 | $ | (0.6 | ) | $ | (95.4 | ) | $ | 42.0 | ||||||||||
Reconciliation of income (loss) from continuing operations to Adjusted EBITDA | $ | — | |||||||||||||||||||||||||
Income (loss) from continuing operations | $ | 59.3 | $ | 68.7 | $ | (2.0 | ) | $ | 12.0 | $ | (0.6 | ) | $ | (95.4 | ) | $ | 42.0 | ||||||||||
Income tax provision | — | — | — | — | — | 20.6 | 20.6 | ||||||||||||||||||||
Interest expense, net of capitalized interest | — | — | — | — | — | 17.3 | 17.3 | ||||||||||||||||||||
Depreciation and amortization | 29.2 | 14.5 | 6.3 | 4.1 | 0.8 | 1.5 | 56.4 | ||||||||||||||||||||
EBITDA from continuing operations | 88.5 | 83.2 | 4.3 | 16.1 | 0.2 | (56.0 | ) | 136.3 | |||||||||||||||||||
Stock based compensation expense | 0.5 | 0.4 | 0.4 | — | — | 4.9 | 6.2 | ||||||||||||||||||||
Gain on sale or impairment of long lived assets | — | — | — | — | — | 0.7 | 0.7 | ||||||||||||||||||||
Investment income | — | — | — | — | — | (3.9 | ) | (3.9 | ) | ||||||||||||||||||
Other operating credits and charges, net | — | — | — | — | — | 11.4 | 11.4 | ||||||||||||||||||||
Adjusted EBITDA from continuing operations | $ | 89.0 | $ | 83.6 | $ | 4.7 | $ | 16.1 | $ | 0.2 | $ | (42.9 | ) | $ | 150.7 | ||||||||||||
Six Months Ended June 30, 2015 (Dollar amounts in millions) | OSB | Siding | EWP | South America | Other | Corporate | Total | ||||||||||||||||||||
Sales | $ | 401.2 | $ | 337.4 | $ | 136.8 | $ | 74.6 | $ | 14.7 | $ | — | $ | 964.7 | |||||||||||||
Depreciation and amortization | 29.0 | 10.1 | 6.3 | 4.2 | 0.9 | 1.5 | 52.0 | ||||||||||||||||||||
Cost of sales and selling and administrative | 418.7 | 265.2 | 139.0 | 66.0 | 15.7 | 43.2 | 947.8 | ||||||||||||||||||||
Loss on sale or impairment of long lived assets | — | — | — | — | — | 0.6 | 0.6 | ||||||||||||||||||||
Other operating credits and charges, net | — | — | — | — | — | 11.6 | 11.6 | ||||||||||||||||||||
Total operating costs | 447.7 | 275.3 | 145.3 | 70.2 | 16.6 | 56.9 | 1,012.0 | ||||||||||||||||||||
Income (loss) from operations | (46.5 | ) | 62.1 | (8.5 | ) | 4.4 | (1.9 | ) | (56.9 | ) | (47.3 | ) | |||||||||||||||
Total non-operating expense | — | — | — | — | — | (14.1 | ) | (14.1 | ) | ||||||||||||||||||
Income (loss) before income taxes and equity in income of unconsolidated affiliates | (46.5 | ) | 62.1 | (8.5 | ) | 4.4 | (1.9 | ) | (71.0 | ) | (61.4 | ) | |||||||||||||||
Income tax benefit | — | — | — | — | — | (5.3 | ) | (5.3 | ) | ||||||||||||||||||
Equity in income of unconsolidated affiliates | — | — | (2.1 | ) | — | — | — | (2.1 | ) | ||||||||||||||||||
Income (loss) from continuing operations | $ | (46.5 | ) | $ | 62.1 | $ | (6.4 | ) | $ | 4.4 | $ | (1.9 | ) | $ | (65.7 | ) | $ | (54.0 | ) | ||||||||
Reconciliation of income (loss) from continuing operations to Adjusted EBITDA from continuing operations | |||||||||||||||||||||||||||
Income (loss) from continuing operations | $ | (46.5 | ) | $ | 62.1 | $ | (6.4 | ) | $ | 4.4 | $ | (1.9 | ) | $ | (65.7 | ) | $ | (54.0 | ) | ||||||||
Income tax benefit | — | — | — | — | — | (5.3 | ) | (5.3 | ) | ||||||||||||||||||
Interest expense, net of capitalized interest | — | — | — | — | — | 14.7 | 14.7 | ||||||||||||||||||||
Depreciation and amortization | 29.0 | 10.1 | 6.3 | 4.2 | 0.9 | 1.5 | 52.0 | ||||||||||||||||||||
EBITDA from continuing operations | (17.5 | ) | 72.2 | (0.1 | ) | 8.6 | (1.0 | ) | (54.8 | ) | 7.4 | ||||||||||||||||
Stock based compensation expense | 0.4 | 0.5 | 0.3 | — | — | 3.9 | 5.1 | ||||||||||||||||||||
Gain on sale or impairment of long lived assets | — | — | — | — | — | 0.6 | 0.6 | ||||||||||||||||||||
Investment income | — | — | — | — | — | (2.4 | ) | (2.4 | ) | ||||||||||||||||||
Other operating credits and charges, net | — | — | — | — | — | 11.6 | 11.6 | ||||||||||||||||||||
Adjusted EBITDA from continuing operations | $ | (17.1 | ) | $ | 72.7 | $ | 0.2 | $ | 8.6 | $ | (1.0 | ) | $ | (41.1 | ) | $ | 22.3 | ||||||||||
Exhibit 99.3 Reconciliation of Adjusted income from continuing operations
As reported Quarter Ended June 30, 2016 | Adjustments | As adjusted Quarter Ended June 30, 2016 | As reported Quarter Ended March 31, 2016 | Adjustments | As adjusted Quarter Ended March 31, 2016 | As reported Quarter Ended June 30, 2015 | Adjustments | As adjusted Quarter Ended June 30, 2015 | |||||||||||||||||||
Net sales | $ | 582.4 | $ | 582.4 | $ | 504.6 | $ | 504.6 | $ | 493.0 | $ | 493.0 | |||||||||||||||
Operating costs and expenses: | |||||||||||||||||||||||||||
Cost of sales | 443.1 | 443.1 | 415.5 | 415.5 | 443.4 | 443.4 | |||||||||||||||||||||
Depreciation and amortization | 28.5 | 28.5 | 27.9 | 27.9 | 25.3 | 25.3 | |||||||||||||||||||||
Selling and administrative | 46.5 | 46.5 | 42.3 | 42.3 | 37.9 | 37.9 | |||||||||||||||||||||
Loss on sale or impairment of long-lived assets, net | 0.7 | (0.7 | ) | — | — | — | — | 0.5 | (0.5 | ) | — | ||||||||||||||||
Other operating credits and charges, net | 11.4 | (11.4 | ) | — | — | — | — | — | — | — | |||||||||||||||||
Total operating costs and expenses | 530.2 | 518.1 | 485.7 | 485.7 | 507.1 | 506.6 | |||||||||||||||||||||
Income (loss) from operations | 52.2 | 64.3 | 18.9 | 18.9 | (14.1 | ) | (13.6 | ) | |||||||||||||||||||
Non-operating income (expense): | |||||||||||||||||||||||||||
Interest expense, net of capitalized interest | (9.3 | ) | 1.5 | (7.8 | ) | (8.0 | ) | (8.0 | ) | (7.2 | ) | (7.2 | ) | ||||||||||||||
Investment income | 2.1 | 2.1 | 1.8 | 1.8 | 1.0 | 1.0 | |||||||||||||||||||||
Other non-operating items | 1.4 | 1.4 | 0.5 | 0.5 | 0.4 | 0.4 | |||||||||||||||||||||
Total non-operating income (expense) | (5.8 | ) | (4.3 | ) | (5.7 | ) | (5.7 | ) | (5.8 | ) | (5.8 | ) | |||||||||||||||
Income (loss) before taxes and equity in income of unconsolidated affiliates | 46.4 | 60.0 | 13.2 | 13.2 | (19.9 | ) | (19.4 | ) | |||||||||||||||||||
Provision (benefit) for income taxes | 16.2 | (16.2 | ) | — | 4.4 | (4.4 | ) | — | 1.0 | (1.0 | ) | — | |||||||||||||||
"Normalized" tax rate @ 35% | — | 21.5 | 21.5 | — | 5.1 | 5.1 | — | (6.3 | ) | (6.3 | ) | ||||||||||||||||
Equity in income of unconsolidated affiliates | (1.5 | ) | (1.5 | ) | (1.5 | ) | — | (1.5 | ) | (1.4 | ) | (1.4 | ) | ||||||||||||||
Net income (loss) | $ | 31.7 | $ | 40.0 | $ | 10.3 | $ | 9.6 | $ | (19.5 | ) | $ | (11.7 | ) | |||||||||||||
Net income (loss) per share of common stock: | |||||||||||||||||||||||||||
Net income (loss) per share - basic | $ | 0.22 | $ | 0.28 | $ | 0.07 | $ | 0.07 | $ | (0.14 | ) | $ | (0.08 | ) | |||||||||||||
Net income (loss) per share - diluted | $ | 0.22 | $ | 0.28 | $ | 0.07 | $ | 0.07 | $ | (0.14 | ) | $ | (0.08 | ) | |||||||||||||
Average shares of stock outstanding - basic | 143.4 | 143.4 | 142.9 | 142.9 | 142.3 | 142.3 | |||||||||||||||||||||
Average shares of stock outstanding - diluted | 145.2 | 145.2 | 145.2 | 145.2 | 142.3 | 142.3 | |||||||||||||||||||||
As reported Six Months Ended June 30, 2016 | Adjustments | As adjusted Six Months Ended June 30, 2016 | As reported Six Months Ended June 30, 2015 | Adjustments | As adjusted Six Months Ended June 30, 2015 | |||||||||||||
Net sales | $ | 1,087.0 | $ | 1,087.0 | $ | 964.7 | $ | 964.7 | ||||||||||
Operating costs and expenses: | — | — | ||||||||||||||||
Cost of sales | 858.6 | 858.6 | 871.2 | 871.2 | ||||||||||||||
Depreciation and amortization | 56.4 | 56.4 | 52.0 | 52.0 | ||||||||||||||
Selling and administrative | 88.8 | 88.8 | 76.6 | 76.6 | ||||||||||||||
Loss on sale or impairment of long-lived assets, net | 0.7 | (0.7 | ) | — | 0.6 | (0.6 | ) | — | ||||||||||
Other operating credits and charges, net | 11.4 | (11.4 | ) | — | 11.6 | (11.6 | ) | — | ||||||||||
Total operating costs and expenses | 1,015.9 | 1,003.8 | 1,012.0 | 999.8 | ||||||||||||||
Income (loss) from operations | 71.1 | 83.2 | (47.3 | ) | (35.1 | ) | ||||||||||||
Non-operating income (expense): | ||||||||||||||||||
Interest expense, net of capitalized interest | (17.3 | ) | 1.5 | (15.8 | ) | (14.7 | ) | (14.7 | ) | |||||||||
Investment income | 3.9 | 3.9 | 2.4 | 2.4 | ||||||||||||||
Other non-operating items | 1.9 | 1.9 | (1.8 | ) | (1.8 | ) | ||||||||||||
Total non-operating income (expense) | (11.5 | ) | (10.0 | ) | (14.1 | ) | (14.1 | ) | ||||||||||
Income (loss) before taxes and equity in income of unconsolidated affiliates | 59.6 | 73.2 | (61.4 | ) | (49.2 | ) | ||||||||||||
Provision (benefit) for income taxes | 20.6 | (20.6 | ) | — | (5.3 | ) | 5.3 | — | ||||||||||
"Normalized" tax rate @ 35% | — | 26.7 | 26.7 | — | (16.5 | ) | (16.5 | ) | ||||||||||
Equity in income of unconsolidated affiliates | (3.0 | ) | (3.0 | ) | (2.1 | ) | (2.1 | ) | ||||||||||
Net income (loss) | $ | 42.0 | $ | 49.5 | $ | (54.0 | ) | $ | (30.6 | ) | ||||||||
Net income (loss) per share of common stock: | ||||||||||||||||||
Net income (loss) per share - basic | $ | 0.29 | $ | 0.35 | $ | (0.38 | ) | $ | (0.22 | ) | ||||||||
Net income (loss) per share - diluted | $ | 0.29 | $ | 0.34 | $ | (0.38 | ) | $ | (0.22 | ) | ||||||||
Average shares of stock outstanding - basic | 143.1 | 143.1 | 142.1 | 142.1 | ||||||||||||||
Average shares of stock outstanding - diluted | 145.1 | 145.1 | 142.1 | 142.1 | ||||||||||||||