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Louisiana-Pacific (LPX) Q4 Earnings, Sales Top Estimates

Zacks

Louisiana-Pacific Corporation LPX posted better-than-expected earnings and revenues in the fourth quarter of 2017. Meanwhile, 2017 was a strong year for Louisiana-Pacific, with double-digit growth across all of its business segments and expects housing demand to remain strong in 2018.

The company reported adjusted earnings per share of 73 cents in fourth-quarter 2017, beating the Zacks Consensus Estimate of 58 cents by 25.9%. Earnings improved considerably from the year-ago quarter’s 23 cents.

Net sales of $711 million in the quarter surpassed the Zacks Consensus Estimate of $634 million by 12.1%. Net sales increased 29% year over year.

Adjusted EBITDA from continuing operations was $199 million in the quarter, up 134.1% from $85 million in the prior-year quarter.

Segmental Analysis

OSB: Sales at the OSB segment increased 30% year over year to $358 million. In the fourth quarter, adjusted EBITDA increased by $79 million from the fourth quarter of 2016.

Sales volumes were down 3% from the prior-year quarter, while sales prices increased 34%.

Siding Segment: The segment manufactures products under two categories — SmartSide siding products and related accessories, and CanExel siding line with a limited amount of OSB. These products are used for new constructions, repair and remodeling, and outdoor structures such as sheds.

This segment’s sales were up 26% to $213 million owing to a 6% increase in SmartSide average sales prices and 16% rise in volumes.

In this quarter under review, the Siding segment recorded adjusted EBITDA of $53 million, reflecting an increase of $24 million from the fourth quarter of 2016.

Engineered Wood Products (EWP): The EWP segment makes I-Joists (IJ), laminated veneer lumber (LVL), laminated strand lumber (LSL) and other related products. These products are used in residential, commercial flooring and roofing systems.

Engineered Wood Products sales grew 38% year over year to $92 million in the quarter owing to higher volumes of I-Joist (up 17%), LSL (42%) and LVL products (20%).

Pricing increased 8% for LVL, 10% for LSL and 7% for I-Joists. Adjusted EBITDA increased $8 million from the prior-year quarter.

South America: This segment comprises facilities in Chile and Brazil. Segmental sales declined 20% year over year to $41 million.

Adjusted EBITDA was $10 million compared with $4 million in fourth-quarter 2016.

Other: Net sales were $7.7 million in the quarter, compared with $6.6 million a year ago.

2017 Highlights

Net sales came in at $2.7 billion, up from $2.2 billion a year ago. Adjusted earnings were $2.33 per share in 2017, a considerable increase from the year-ago profit level of 89 cents per share.

Financials

Louisiana-Pacific ended the quarter with cash and cash equivalents of $928 million, as of Dec 31, 2017, compared with $659.3 million as of Dec 31, 2016.

Louisiana-Pacific Corporation Price, Consensus and EPS Surprise


Louisiana-Pacific Corporation Price, Consensus and EPS Surprise | Louisiana-Pacific Corporation Quote

Zacks Rank & Peer Releases

Louisiana-Pacific sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Masco Corporation’s MAS fourth-quarter 2017 adjusted earnings per share of 44 cents surpassed the Zacks Consensus Estimate of 43 cents by 2.3%. Adjusted earnings increased 33% year over year.

Rayonier Inc. RYN reported fourth-quarter 2017 pro forma net income per share of 20 cents, comfortably beating the Zacks Consensus Estimate of 9 cents. Further, the bottom line came in significantly above the prior-year quarter figure of 5 cents.

PulteGroup’s PHM fourth-quarter 2017 adjusted earnings per share of 85 cents beat the Zacks Consensus Estimate of 84 cents by 1.2%. Also, earnings reflect a 27% jump from the year-ago quarter’s 67 cents.

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