Louisiana-Pacific Shares Slip Post Q2 Results

Louisiana-Pacific Shares Slip Post Q2 Results
  • Louisiana-Pacific Corp LPX reported a second-quarter FY22 sales decline of 3% year-on-year to $1.13 billion, missing the consensus of $1.25 billion.
  • The gross margin contracted by 1,272 bps to 45.8%. The operating income decreased 27.1% Y/Y to $462 million with an operating margin of 40.9%, down by 1,240 bps.
  • Adjusted EPS, including discontinued operations, was $4.57, and adjusted EPS from continuing operations was $4.19.
  • Adjusted EBITDA decreased 26.2% Y/Y to $491 million, and margin fell by 1,350 bps to 43.5%.
  • Louisiana-Pacific generated cash from operating activities year-to-date of $908 million, compared to $772 million a year ago. It had cash and equivalents of $517 million as of June 30, 2022.
  • During the quarter, LPX paid $471 million to repurchase 7.3 million of its common shares.
  • "Despite ongoing raw material inflation and logistics challenges, LP's teams consistently executed our strategy to meet sustained customer demand," commented LP Chair and CEO Brad Southern.
  • 3Q22 Outlook: Louisiana-Pacific expects Siding Solutions revenue growth of ~20%. OSB revenue is expected to be sequentially lower than Q2 by ~40%, assuming that OSB prices published by Random Lengths remain unchanged from those posted on August 5, 2022.
  • It expects an Adjusted EBITDA of ~$200 million.
  • For FY22, LPX expects Siding Solutions' full-year revenue growth to be greater than 20%.
  • The company expects capital expenditures of $400 million - $430 million.
  • Price Action: LPX shares are trading lower by 6.12% at $58.80 on the last check Tuesday.

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