Louisiana-Pacific Corporation’s (LPX Quick QuoteLPX - Free Report) , or LP, reported better-than-expected first-quarter 2025 results, with adjusted earnings and net sales beating the Zacks Consensus Estimate. On a year-over-year basis, the bottom line declined while the top line remained flat.

The quarter’s performance reflects strength in the company’s Siding business, mainly backed by ExpertFinish growth, share gains in new residential construction and improving shed market. This growth was partially offset by soft contributions from the Oriented Strand Board (OSB) segment.

Despite uncertainties surrounding the new tariff regime and an inflationary market scenario, the company is well-positioned for 2025. Backed by its in-house abilities, strategic focus on higher-margin products and its position across the diverse end markets, LPX aims to navigate through the market risks.

After the earnings announcement, LPX shares gained 3.3% yesterday during the trading session.

Louisiana-Pacific’s Quarterly Earnings & Revenue Discussion

The company reported adjusted earnings per share (EPS) of $1.27, which surpassed the Zacks Consensus Estimate of $1.13 by 12.4%. In the year-ago period, LP reported an adjusted EPS of $1.53. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)

Net sales of $724 million also topped the consensus mark of $693 million by 4.5% and remained flat year over year.

Adjusted EBITDA of $162 million was down 11% from the prior-year quarter. The downturn was primarily attributed to lower OSB selling prices and volumes, partially offset by the positive impact from higher Siding net sales.

Segmental Analysis of LPX’s Q1 Release

Siding: The segment’s sales of $402 million increased 11% from the prior-year period, supported by a 9% rise in volume and a 2% increase in average selling prices. Notably, ExpertFinish products accounted for 10% of volume and 15% of net sales, resulting in a favorable mix.

The Siding segment maintained its profitability, posting an adjusted EBITDA of $106 million, up 17% from the year-ago level. The metric was stimulated by positive impacts of the increased net sales, somewhat offset by investments in sales and marketing and a $2 million tariff impact.

OSB: Sales in the segment decreased 15% year over year to $267 million, owing to a $32 million decrease in OSB selling prices and a $13 million decline in sales volumes. Shipments in OSB-Structural Solutions declined 10%, somewhat offset by 3% growth in OSB-Commodity.

The segment’s adjusted EBITDA plunged significantly 40% year over year to $54 million due to lower OSB prices and volumes.

LP South America (LPSA): Sales of $52 million grew 11% year over year. Adjusted EBITDA increased 22% from the year-ago quarter to $12 million. This improvement was largely due to higher sales volumes offset by unfavorable currency fluctuations.

Louisiana-Pacific’s Toll Brothers’ Balance Sheet & Cash Flow

As of March 31, 2025, Louisiana-Pacific had $1 billion in liquidity. As of the first-quarter end, cash and cash equivalents were $256 million, down from $340 million at 2024-end. Long-term debt of $348 million remained flat with the 2024-end level.

In the first three months of 2025, net cash provided by operations was $64 million compared with $105 million in the comparable period a year ago.

During the first quarter, the company repurchased 0.6 million of its common shares for a total of $61 million. As of March 31, about $177 million remained under the pre-existing share repurchase authorizations. The company paid $20 million in cash dividends.

LPX Unveils Q2 Outlook

LPX expects its Siding net sales to range between $445 million and $455 million, reflecting 9-11% growth year over year. It anticipates Siding adjusted EBITDA to be between $110 million and $120 million, with the segment’s adjusted EBITDA margin to be about 26%. In the year-ago quarter, Siding’s adjusted EBITDA was $105 million.

OSB’s adjusted EBITDA is expected to be between $15 million and $25 million, which compares with $125 million reported a year ago.

Total adjusted EBITDA is expected to be between $125 million and $145 million compared with $229 million reported in last year’s quarter.

Louisiana-Pacific Revises 2025 Outlook

For the full year, the company now anticipates Siding's net sales to grow more than 9%, reaching approximately $1.7 billion. It now forecasts Siding adjusted EBITDA between $425 and $435 million (up from the prior range of $415-$425 million), with adjusted EBITDA margin more than 25%.

For the OSB segment, adjusted EBITDA is now expected to be between $110 million and $120 million, down from the previous expectation of $200-$210 million.

Consolidated adjusted EBITDA is now expected to be between $535 million and $555 million, down from the prior expected range of $615-$635 million.

Capital expenditures reached $183 million in 2024, with plans to invest approximately $410 million in 2025, signaling confidence in future growth.

LPX’s Zacks Rank & Recent Construction Releases

Louisiana-Pacific currently carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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