Tough Q2 for LP

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Tough Q2 for LP

By HBSDealer Staff - 08/06/2019
Louisiana-Pacific Corporation reported second quarter 2019 sales plunged 27% to $588 million from second quarter 2018 net sales of $811 million.

Sales for the first half of the year fell 22% to $1.17 billion from sales of $1.5 billion for the first six months of 2018.

Profits for the Nashville, Tenn.-based building products and building solutions provider were hit hard as the company posted a second quarter net income of $17 million compared to a net income of $163 million in the second quarter of last year.

For the first six months of 2019, LP reported a net income of $44 million as compared to a net income of $254 million in the first half of 2018.

Declines in OSB pricing in all North American operations had a negative impact on LP's operating results of $166 million for the quarter, the company said. 

During the second quarter, siding sales fell roughly 9% to $238 million from sales of $262 million. OSB manufacturing and distribution sales fell 49% to $199 million during the period while engineered wood product sales declined more than 19% to $113 million. 

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The bottom line: Sagging OSB prices hit LP’s sales and profits hard in the second quarter. 

What the CEO said: “Despite stiff headwinds and a challenging economic environment, we continued to make progress this quarter, shifting our business further from the commodity space towards value-added, high-performance solutions, while efficiently balancing OSB production with demand,” said Brad Southern, LP CEO. “Although our LP SmartSide® Strand growth was hampered by the weak housing market, we remain confident in our ability to grow this business over the long term.”

Company info: LP’s full second quarter 2019 report can be read here

 

 

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