LP builds big sales in Q4
Louisiana-Pacific Corporation (LP Building Solutions) reported fourth quarter 2020 sales jumped 60% to $860 million from fourth quarter 2019 sales of $537 million.
The Nashville, Tenn.-based building products manufacturer and construction solutions provider said that LP SmartSide sales increased by 30% to $257 million during the fourth quarter, bringing full-year SmartSide net sales growth to 15%.
Oriented strand board sales (OSB) leaped about 149% to $428 million for the period, driven by higher OSB prices. In the prior fourth quarter, LP reported OSB sales of $256 million.
Engineered wood product (EWP) sales increased 16% to $108 million for the quarter.
Total sales for the full year jumped more than 21% to $2.79 billion from 2019 total sales of $2.31 billion.
For the fourth quarter, LP reported a net income of $255 million, marking a huge swing from a net loss of $55 million the previous fourth quarter. Profits for the year also soared to $497 million as compared to a net loss of $10 million in 2019.
LP also announced that product demand has prompted the company to make several production moves.
The company’s Houlton, Maine mill to be converted to SmartSide manufacturing facility with production beginning in early 2022. Additionally, LP said that the next siding conversion after Houlton is likely to be at its Sagola, Mich. mill.
LP is currently initiating the process to restart its Peace Valley OSB mill in Fort St. John, British Columbia as well.
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The Bottom Line: LP swings to a net income of $255 million in the fourth quarter compared to a net loss of $55 million in the previous fourth quarter.
What the CEO said: "LP ended 2020 having exceeded our 3-year transformation targets for growth and efficiency, with a cumulative EBITDA impact of $178 million. We reached this milestone a year early, largely as a result of exceptional SmartSide sales growth, which reached 30% in Q4," said LP Chairman and CEO Brad Southern. "In order to meet growing customer demand for SmartSide and OSB, LP will convert our mill in Houlton, Maine to the manufacture of SmartSide, with production beginning early in 2022, and we have begun the process to restart our OSB mill in Peace Valley, British Columbia”
“COVID made 2020 a difficult year for LP employees, our customers, their families, and the communities we all serve,” Southern added. “Our results are a testament to their resilience and determination, and I am extremely proud of the results we achieved in the face of these challenges."
Company info: The full fourth quarter 2020 financial report from Louisiana-Pacific Corporations is available here.