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Louisiana-Pacific Corporation (LPX - Free Report) or LP, reported mixed third-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate, but net sales missed the same. Both metrics declined on a year-over-year basis.
LPX’s shares jumped 5.56% on Nov 2, after the company noted that Siding sales volume, price and net sales increased sequentially. Also, LP is witnessing normalized Siding inventories.
LP's strategy positions it well for long-term growth as the housing outlook continues to improve.
Detailed Discussion
Louisiana-Pacific reported adjusted earnings of $1.62 per share, beating the Zacks Consensus Estimate of $1.39 by 16.6%. The bottom line declined 5.8% from the year-ago quarter’s reported figure of $1.72 per share.
Net sales of $728 million missed the consensus estimate of $736 million by 1.1% and declined 15% from the prior year, owing to lower segmental sales.
Louisiana-Pacific Corporation Price, Consensus and EPS Surprise
Single-family housing starts rose to 258 from the 242 units reported in the year-ago period. Multi-family starts were down to 104 units from 144 units reported a year ago.
Adjusted EBITDA of $190 million was down 5% from the prior-year quarter’s level.
Segmental Analysis
Siding: The segment’s sales of $345 million were down 13% from the prior-year period. A 3% rise in the average net selling price (“ASP”) was offset by a 16% decrease in volume from prior-year levels. The ASP benefited from list price increases. Volume reduced on challenging new and existing home selling markets as well as record results in the comparable year-ago period.
Adjusted EBITDA came in at $71 million, a 21% decline from $90 million reported a year ago. Lower volumes and press rebuild costs, partially offset by higher ASP and lower freight, raw materials and labor costs, hurt adjusted EBITDA.
OSB: Sales in the segment decreased 14% year over year to $335 million, owing to a decrease in sales volume from market curtailments and reduced production volume from the conversion of its Sagola, MI, mill to siding production. This was partially offset by an increase in OSB prices.
The company’s adjusted EBITDA grew 6% year over year to $120 million due to improved prices and lower mill-related costs, partially offset by lower sales volumes.
South America: Sales of $45 million declined 16% due to lower OSB volumes and ASP. Adjusted EBITDA plunged 54% from the year-ago quarter to $6 million due to lower sales volumes, reduced ASP and higher equipment relocation costs.
Financials
At September-end, LP had more than $710 million in liquidity. As of Jun 30, 2023, Louisiana-Pacific had cash and cash equivalents of $160 million compared with $369 million at 2022-end. Long-term debt was $347 million compared with the 2022-end level of $346 million.
For the third quarter, net cash provided by operations was $187 million, down from $195 million reported in the respective year-ago period.
At September-end, $200 million shares remained under the share repurchase program authorized in May 2022.
Guidance
For the fourth quarter, OSB revenues are expected to be sequentially lower by approximately 30% (based on Random Lengths’ report published on Oct 7, 2023). It anticipates a consolidated adjusted EBITDA of $60-$80 million.
For 2023, the company expects Siding Solutions’ revenues to decline by 10% from the year-ago period.
For the year, the company anticipates capital expenditures to range between $280 million and $295 million. The capital expenditure for mill conversions is likely to be $100-$105 million, $130-$135 million for sustaining maintenance and $50-$55 million for other strategic growth projects.
UFP Industries, Inc. (UFPI - Free Report) reported tepid results for third-quarter 2023, wherein earnings and revenues missed the Zacks Consensus Estimate and declined on a year-over-year basis. Lower pricing and organic unit sales hurt the company’s quarterly results.
Despite a tough year-over-year comparison, UFPI's emphasis on innovation, efficiencies and value-added solutions helped in margin expansion. The company remains focused on expanding its business through new products and acquisitions on the back of strong cash flow generation and a solid balance sheet position.
Vulcan Materials Company (VMC - Free Report) reported stellar results for the third quarter of 2023, surpassing the Zacks Consensus Estimate for both earnings and revenues.
VMC’s adjusted EPS of $2.29 increased 28.7% from the year-ago level of $1.78. Total revenues of $2,185.8 million increased 4.7% year over year.
United Rentals, Inc.’s (URI - Free Report) third-quarter 2023 earnings and revenues surpassed the Zacks Consensus Estimate. On a year-over-year basis, earnings and revenues increased courtesy of sustained growth across the business, profitability and returns, underpinned by broad-based activity.
URI’s adjusted EPS of $11.73 increased 26.5% from the prior-year figure of $9.27 per share. Total revenues of $3.77 billion grew 23.4% year over year.
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Louisiana-Pacific (LPX) Q3 Earnings Beat, Adjusted EBITDA Falls
Louisiana-Pacific Corporation (LPX - Free Report) or LP, reported mixed third-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate, but net sales missed the same. Both metrics declined on a year-over-year basis.
LPX’s shares jumped 5.56% on Nov 2, after the company noted that Siding sales volume, price and net sales increased sequentially. Also, LP is witnessing normalized Siding inventories.
LP's strategy positions it well for long-term growth as the housing outlook continues to improve.
Detailed Discussion
Louisiana-Pacific reported adjusted earnings of $1.62 per share, beating the Zacks Consensus Estimate of $1.39 by 16.6%. The bottom line declined 5.8% from the year-ago quarter’s reported figure of $1.72 per share.
Net sales of $728 million missed the consensus estimate of $736 million by 1.1% and declined 15% from the prior year, owing to lower segmental sales.
Louisiana-Pacific Corporation Price, Consensus and EPS Surprise
Louisiana-Pacific Corporation price-consensus-eps-surprise-chart | Louisiana-Pacific Corporation Quote
Single-family housing starts rose to 258 from the 242 units reported in the year-ago period. Multi-family starts were down to 104 units from 144 units reported a year ago.
Adjusted EBITDA of $190 million was down 5% from the prior-year quarter’s level.
Segmental Analysis
Siding: The segment’s sales of $345 million were down 13% from the prior-year period. A 3% rise in the average net selling price (“ASP”) was offset by a 16% decrease in volume from prior-year levels. The ASP benefited from list price increases. Volume reduced on challenging new and existing home selling markets as well as record results in the comparable year-ago period.
Adjusted EBITDA came in at $71 million, a 21% decline from $90 million reported a year ago. Lower volumes and press rebuild costs, partially offset by higher ASP and lower freight, raw materials and labor costs, hurt adjusted EBITDA.
OSB: Sales in the segment decreased 14% year over year to $335 million, owing to a decrease in sales volume from market curtailments and reduced production volume from the conversion of its Sagola, MI, mill to siding production. This was partially offset by an increase in OSB prices.
The company’s adjusted EBITDA grew 6% year over year to $120 million due to improved prices and lower mill-related costs, partially offset by lower sales volumes.
South America: Sales of $45 million declined 16% due to lower OSB volumes and ASP. Adjusted EBITDA plunged 54% from the year-ago quarter to $6 million due to lower sales volumes, reduced ASP and higher equipment relocation costs.
Financials
At September-end, LP had more than $710 million in liquidity. As of Jun 30, 2023, Louisiana-Pacific had cash and cash equivalents of $160 million compared with $369 million at 2022-end. Long-term debt was $347 million compared with the 2022-end level of $346 million.
For the third quarter, net cash provided by operations was $187 million, down from $195 million reported in the respective year-ago period.
At September-end, $200 million shares remained under the share repurchase program authorized in May 2022.
Guidance
For the fourth quarter, OSB revenues are expected to be sequentially lower by approximately 30% (based on Random Lengths’ report published on Oct 7, 2023). It anticipates a consolidated adjusted EBITDA of $60-$80 million.
For 2023, the company expects Siding Solutions’ revenues to decline by 10% from the year-ago period.
For the year, the company anticipates capital expenditures to range between $280 million and $295 million. The capital expenditure for mill conversions is likely to be $100-$105 million, $130-$135 million for sustaining maintenance and $50-$55 million for other strategic growth projects.
Zacks Rank & Recent Construction Releases
Louisiana-Pacific currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
UFP Industries, Inc. (UFPI - Free Report) reported tepid results for third-quarter 2023, wherein earnings and revenues missed the Zacks Consensus Estimate and declined on a year-over-year basis. Lower pricing and organic unit sales hurt the company’s quarterly results.
Despite a tough year-over-year comparison, UFPI's emphasis on innovation, efficiencies and value-added solutions helped in margin expansion. The company remains focused on expanding its business through new products and acquisitions on the back of strong cash flow generation and a solid balance sheet position.
Vulcan Materials Company (VMC - Free Report) reported stellar results for the third quarter of 2023, surpassing the Zacks Consensus Estimate for both earnings and revenues.
VMC’s adjusted EPS of $2.29 increased 28.7% from the year-ago level of $1.78. Total revenues of $2,185.8 million increased 4.7% year over year.
United Rentals, Inc.’s (URI - Free Report) third-quarter 2023 earnings and revenues surpassed the Zacks Consensus Estimate. On a year-over-year basis, earnings and revenues increased courtesy of sustained growth across the business, profitability and returns, underpinned by broad-based activity.
URI’s adjusted EPS of $11.73 increased 26.5% from the prior-year figure of $9.27 per share. Total revenues of $3.77 billion grew 23.4% year over year.