LP posts second-quarter loss
Second-quarter sales at Nashville, Tennessee-based LP were $493 million, down 5% compared with the year-ago quarter.
The company swung to a net loss of $19.5 million for the period ended June 30, compared with earnings of $2.1 million in the second quarter last year.
“The continued weakness in OSB pricing in the quarter, we believe, was caused by the reduction in demand due to very wet weather in the middle of the country, including Texas,” CEO Curt Stevens said. “With the distribution channel relatively full coming out of the first quarter, re-ordering was at a slower pace than anticipated.“
He added: “I am pleased with another strong quarter from our Siding business and the return of EWP to positive adjusted EBITDA.”
The Siding segment, which consists of SmartSide siding as well as LP's prefinished CanExel siding line, reported operating income of $29 million compared with $26 million in the year-ago quarter.
Other data from LP divisions includes:
• LP's OSB segment reported net sales for the second quarter of 2015 of $211 million, a 6% decrease from $224 million of net sales in the second quarter of 2014.
• In the siding segment, net sales were $164 million in the second quarter of 2015, a decrease of 3% from $170 million in the year-ago second quarter.
• The Engineered Wood Product segment sales in the second quarter totaled $72 million, down 5% from the year-ago quarter.
• The South American segment, which consists of facilities in Chile and Brazil, reported sales in the second quarter of $39 million, down 8% from $42 million in the second quarter of 2014.
“With reported housing starts in June at 1.174 million and permits at 1.343 million, we should see an acceleration of building activity in the second half of this year,” Stevens continued. “Persistent labor shortages and the possibility of interest rate increases later in the year could dampen forecasted growth in the short term, but increasing household formations and the need for housing should support continued building activity.”