LP posts Q3 net loss, appoints COO and CFO
Louisiana-Pacific has posted a third-quarter net loss of $65.6 million, compared with a net loss of $32 million in the third quarter of 2010. Net sales for the quarter ended Sept. 30 totaled $351 million, up 8.7% from $323 million in the year-ago period.
"The building products market moved ahead at a slow place in the third quarter," CEO Rick Frost said. "Housing activity remains at low levels, consumer confidence has been negatively affected by the political situation in Washington, and job recovery remains muted. LP was agile in our response to the market conditions and ended the quarter with slightly higher cash balances than at the end of June."
For the nine months ended Sept. 30, LP reported a net loss of $124.1 million, compared with a net loss of $32.2 million in the year-ago period. Net sales for the nine months totaled $1.04 billion, down slightly from $1.07 billion in the first nine months of 2010.
LP’s Oriented Strand Board (OSB) segment reported net sales for the third quarter of $139 million, compared with $140 million in the third quarter of 2010.
The company’s Siding segment, which consists of SmartSide siding and LP’s prefinished Canexel siding line, reported net sales of $112 million in the third quarter of 2011, an increase of 7% from $105 million in the year-ago third quarter.
The Engineered Wood Products (EWP) segment, comprised of I-Joist (IJ), Laminated Veneer Lumber and Laminated Strand Lumber (LVL and LSL), saw third-quarter sales of $55 million, an increase of 44% from $38 million in the year-ago quarter.
"LP will continue to act cautiously for the rest of 2011 and into 2012," Frost said. "While there has been some recent good news in housing starts and remodeling activity, the base economy seems to be fairly flat. Longer term, the estimated 23.2 million adults now living with their parents should eventually become homeowners."
In other company news, LP has announced that executive VP Curt Stevens, LP’s chief financial officer since 1997, will assume the interim position of executive VP and chief operating officer, newly created by the LP board of directors. Sallie Bailey will join the company as executive VP and chief financial officer.
Beginning Dec. 5, Stevens will become responsible for LP’s sales and marketing, operating units and support functions, while Bailey will oversee financial matters. Both will report to Frost.
"LP will continue to benefit from Curt’s experience and deep knowledge of LP in his role as chief operating officer," Frost said. "We are also very fortunate that someone of Sallie’s caliber and experience has chosen to join the LP team as CFO."
Stevens is a certified public accountant and a member of the board of directors for Quanex Building Products Corp.
Bailey is also a certified public accountant and has held a variety of senior finance roles, including CFO at Ferro Corp. and senior VP, finance and controller at Timken Corp.
ProBuild shutters 12 locations
“We will be exiting three markets, consolidating our operations in three markets and eliminating lines of business in three markets,” said president and CEO Fred Marino in a memo sent to ProBuild employees last month.
All told, the company’s latest round of closings amounts to 12 shuttered locations across the country.
“We will continue to serve our customers in the majority of markets with a more efficient footprint and/or a rationalized service offering suited to each market.”
Most of the closures are expected to take place by Nov. 15, 2011. The company will make market exits in Yorkville and Westmont, Ill.; Columbia, S.C.; and South Fork, Colo. It plans market consolidations in Granite Falls, Sedro-Woolley, Coupeville, Bonney Lake and Moses Lake, Wash.; and Cherry Hill, N.J.
ProBuild also plans service reductions in Greensboro, N.C., and Fredericksburg, Va. For these locations, only ProBuild’s gypsum operations will remain in the market. The gypsum operation in Lynchburg, Va., will be discontinued, although that location will remain open and continue its lumber operations.
“It is difficult to make the decision to close operations because we recognize the impact it will have on our employees and the communities we serve,” Marino said in the memo. “But this step is made to improve overall profitability of the company, and to retain jobs and more effectively serve our customers across the country.
“ProBuild is facing tough decisions like this all around the country as we continue to deal with a struggling economy. But we are confident that by making these difficult decisions now, ProBuild will ultimately be better positioned to weather the downturn and eventually thrive when market conditions become more favorable.”
ENAP lumber conference attracts a crowd
Lumber and building material dealer co-op ENAP, Inc. held its Forest Products Conference October 23-25, 2011 in Baltimore, MD.
“Despite extremely difficult market conditions, attendance by both the member and vendor community exceeded our expectations and speaks volumes to the commitment we have to the future of this industry," saic Duncan Facey, VP of Forest Products for ENAP. "The Conference provided insight on what lies ahead for all of us in 2012.”
Specificially, the conference delivered on a variety of presentation and seminar topics, including:
• Keynote Speaker Dr. Edmond Siefried, Professor Emeritus of Economics and Business at Lafayette College in Easton, PA, who presented “Current Recovery without a Healthy Housing Sector?”
• “A Market Overview” presented by Frank Turnbull, Marketing & Member Development, Canfor; and
• “Lumber Grade Rules…Have They Changed?” presented by Frank Stewart, Technical & Product Support Services Director, WWPA.
“The quality of the representation at the mill level made the investment extremely worthwhile," John Callahan, Riverhead Building Supply, Riverhead, N.Y. "The fact that there were so many decision-makers in attendance is a testament to the value that ENAP brings to the table on both sides of the business equation.”