LOUISIANA-PACIFIC CORP

Previous wording

Demand for our products correlates positively with new home construction and repair and remodeling activity in North America, which historically has been characterized by significant cyclicality. The U.S. Census Bureau reported on July 18, 2025, that actual single-family housing starts were 9% and 7% lower, respectively, for the three and six months ended June 30, 2025, as compared to the same periods in 2024. Actual multi-family housing starts for the three and six months ended June 30, 2025, were 22% and 17% higher, respectively, as compared to the same periods in 2024. Repair and remodeling activity is difficult to reasonably measure, but the general sentiment among repair and remodeling contractors is more cautious than expected earlier in the year.

Current wording

Demand for our products correlates positively with new home construction and repair and remodeling activity in North America, which historically has been characterized by significant cyclicality. The U.S. Census Bureau published actual U.S. housing starts data on September 17, 2025. September 2025 housing starts have not yet been published by the U.S. Census Bureau, and therefore, we have calculated September housing starts as the average of July and August 2025 actual housing starts. Actual single-family housing starts were approximately 4% and 5% lower, respectively, for the three and nine months ended September 30, 2025, as compared to the same periods in 2024. Actual multi-family housing starts for the three and nine months ended September 30, 2025, were approximately 24% and 20% higher, respectively, as compared to the same periods in 2024. Repair and remodeling activity is difficult to reasonably measure, but the general sentiment among repair and remodeling contractors is more cautious than expected earlier in the year.

Previous wording

The international trade landscape has been extremely volatile in recent periods. The U.S. government has recently announced significant changes to U.S. trade policy, including the implementation or planned imposition of new or increased tariffs on a broad range of goods imported from international markets, including Canada and China, as well as the potential modification or termination of existing trade agreements between the U.S. and certain other countries. In response, certain countries have imposed, or are considering, retaliatory tariffs on U.S. exports. The global tariff landscape continues to shift rapidly, with changes impacting businesses and markets around the world. These changes could negatively affect our sales and our competitive position within the U.S. market and in markets outside the U.S. Further, changing trade policy in the U.S. and other countries, particularly Canada and China, could increase the cost of certain raw materials or components that are critical to our manufacturing process, which could have a material negative impact on our manufacturing costs and our overall financial performance. While we are actively exploring opportunities to mitigate these increased costs, there can be no guarantee that we will be able to achieve successful mitigation strategies or meaningfully offset the financial impact of new or increased tariffs, or other adverse changes to trade policy, in the U.S. or other countries. In the six months ended June 30, 2025, our cost of sales in the Siding segment was negatively impacted by $5 million related to new or increased tariffs. Based on a preliminary analysis of the potential effects of the tariffs that are currently in force in the United States, as well as in other markets where we operate, we estimate that we could incur potential incremental costs of approximately $12 million in 2025, most of which would likely be incurred by the Siding segment. The potential impact of these factors on our future operational and financial performance is uncertain. As a result, our past performance may not be indicative of future results.

Current wording

The international trade landscape has been extremely volatile in recent periods. Earlier this year, the U.S. government announced significant changes to U.S. trade policy, including the implementation or planned imposition of new or increased tariffs and trade barriers on a broad range of goods imported from international markets, including Canada and China, as well as the potential modification or termination of existing trade agreements between the U.S. and certain other countries. In response, certain countries have imposed, or are considering, retaliatory tariffs on U.S. exports. The global tariff landscape continues to shift rapidly, with changes impacting businesses and markets around the world. These changes could negatively affect our sales and our competitive position within the U.S. market and in markets outside the U.S. Further, changing trade policy in the U.S. and other countries, particularly Canada and China, could continue to increase the cost of certain raw materials or components that are critical to our manufacturing process, which could have a material negative impact on our manufacturing costs and our overall financial performance. While we are actively exploring opportunities to mitigate these increased costs, there can be no guarantee that we will be able to achieve successful mitigation strategies or meaningfully offset the financial impact of new or increased tariffs, or other adverse changes to trade policy, in the U.S. or other countries. In the nine months ended September 30, 2025, our cost of sales in the Siding segment was negatively impacted by $7 million related to new or increased tariffs. Based on a preliminary analysis of the potential effects of the tariffs that are currently in force in the United States, as well as in other markets where we operate, we estimate that we could incur potential incremental costs of approximately $8 million in 2025, most of which would likely be incurred by the Siding segment. The potential impact of these factors on our future operational and financial performance is uncertain. As a result, our past performance may not be indicative of future results.

Previous wording

OSB is a commodity product, and it is subject to competition from manufacturers worldwide. Product supply is influenced primarily by fluctuations in available manufacturing capacity and imports. The ratio of overall OSB demand to capacity generally drives price. We cannot predict whether the prices of our OSB products will remain at current levels or fluctuate in the future.

Current wording

OSB is a commodity product, and it is subject to competition from manufacturers worldwide. Product supply is influenced primarily by fluctuations in available manufacturing capacity and imports. The ratio of overall OSB demand to capacity generally drives prices. We cannot predict whether the prices of our OSB products will remain at current levels or fluctuate in the future.

Previous wording

In evaluating our business, we utilize non-GAAP financial measures that fall within the meaning of SEC Regulation G and Regulation S-K Item 10(e), which we believe provide users of the financial information with additional meaningful comparison to prior reported results. Non-GAAP financial measures do not have standardized definitions and are not defined by U.S. GAAP. In this quarterly report on Form 10-Q, we disclose net income excluding interest expense, provision for income taxes, depreciation and amortization, stock-based compensation expense, loss on impairment attributed to LP, business exit credits and charges, product-line discontinuance charges, other operating credits and charges, net, loss on early debt extinguishment, investment income, pension settlement charges, other non-operating items, income from discontinued operations, net of income taxes, and net income attributed to noncontrolling interest, as Adjusted EBITDA (Adjusted EBITDA), which is a non-GAAP financial measure. We have included Adjusted EBITDA in this report because we view it as an important supplemental measure of our performance and believe that it is frequently used by interested persons in the evaluation of companies that have different financing and capital structures and/or tax rates. We also disclose net income excluding loss on impairment attributed to LP, business exit credits and charges, product-line discontinuance charges, interest expense outside of normal operations, other operating credits and charges, net, loss on early debt extinguishment, gain (loss) on acquisition, pension settlement charges, income from discontinued operations, net of income taxes, and net income attributed to noncontrolling interest, and adjusting for a normalized tax rate, as Adjusted Income (Adjusted Income), which is a non-GAAP financial measure. We also disclose Adjusted Diluted EPS, which is calculated as Adjusted Income divided by diluted shares outstanding (Adjusted Diluted EPS). We believe that Adjusted Diluted EPS and Adjusted Income are useful measures for evaluating our ability to generate earnings and that providing these measures should allow interested persons to more readily compare the earnings for past and future periods. Reconciliations of Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS to their most directly comparable U.S. GAAP financial measures, net income and net income per share of common stock - diluted, respectively, are presented below.

Current wording

In evaluating our business, we utilize non-GAAP financial measures that fall within the meaning of SEC Regulation G and Regulation S-K Item 10(e), which we believe provide users of the financial information with additional meaningful comparison to prior reported results. Non-GAAP financial measures do not have standardized definitions and are not defined by U.S. GAAP. In this quarterly report on Form 10-Q, we disclose net income excluding interest expense, provision for income taxes, depreciation and amortization, stock-based compensation expense, loss on impairment attributed to LP, business exit credits and charges, product-line discontinuance charges, other operating credits and charges, net, loss on early debt extinguishment, investment income, pension settlement charges, other non-operating items, income from discontinued operations, net of income taxes, and net income attributed to noncontrolling interest, as Adjusted EBITDA (Adjusted EBITDA), which is a non-GAAP financial measure. We have included Adjusted EBITDA in this report because we view it as an important supplemental measure of our performance and believe that it is frequently used by interested persons in the evaluation of companies that have different financing and capital structures and/or tax rates. We also disclose net income excluding loss on impairment attributed to LP, business exit credits and charges, product-line discontinuance charges, interest expense outside of normal operations, other operating credits and charges, net, loss on early debt extinguishment, gain (loss) on acquisition, pension settlement charges, income from discontinued operations, net of income taxes, and net income attributed to noncontrolling interest, and adjusting for a normalized tax rate, as Adjusted Income (Adjusted Income), which is a non-GAAP financial measure. In addition, we disclose Adjusted Diluted EPS, which is calculated as Adjusted Income divided by diluted shares outstanding (Adjusted Diluted EPS). We believe that Adjusted Diluted EPS and Adjusted Income are useful measures for evaluating our ability to generate earnings and that providing these measures should allow interested persons to more readily compare the earnings for past and future periods. Reconciliations of Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS to their most directly comparable U.S. GAAP financial measures, net income and net income per share of common stock - diluted, respectively, are presented below.

Previous wording

The following table provides the reconciliation of net income to Adjusted Income (dollar amounts in millions, except per share amounts):

Current wording

The following table reconciles net income to Adjusted Income (dollar amounts in millions, except per share amounts):

Previous wording

The following table sets forth housing starts for the three and six months ended June 30, 2025 and 2024 (in thousands):

Current wording

The following table sets forth housing starts for the three and nine months ended September 30, 2025 and 2024 (in thousands):

Previous wording

1 Actual U.S. housing starts data, in thousands, reported by the U.S. Census Bureau as published through July 18, 2025.

Current wording

1 Actual U.S. housing starts data, in thousands, reported by the U.S. Census Bureau as published through September 17, 2025. September 2025 housing starts have not yet been published by the U.S. Census Bureau, and therefore, we have calculated September housing starts as the average of July and August 2025 actual housing starts.

Previous wording

The following table sets forth sales volumes for the three and six months ended June 30, 2025 and 2024 (in MMSF):

Current wording

The following table sets forth sales volumes for the three and nine months ended September 30, 2025 and 2024 (in MMSF):

Previous wording

We measure Overall Equipment Effectiveness (OEE) of each of our mills to track improvements in the utilization and productivity of our manufacturing assets. OEE is a composite metric that considers asset uptime (adjusted for capital project downtime and similar events), production rates, and finished product quality. We believe that when used in conjunction with other metrics, OEE can be a useful measure for evaluating our ability to generate profits, and that providing this measure should allow interested persons to monitor operational improvements. We use a best-in-class target across all LP sites that allows us to optimize capital investments, focus maintenance and reliability improvements, and improve overall equipment efficiency. It should be noted that other companies may present OEE data differently, and therefore, as presented by us, OEE data may not be comparable to similarly titled measures reported by other companies.

Current wording

We measure OEE of each of our mills to track improvements in the utilization and productivity of our manufacturing assets. OEE is a composite metric that considers asset uptime (adjusted for capital project downtime and similar events), production rates, and finished product quality. We believe that when used in conjunction with other metrics, OEE can be a useful measure for evaluating our ability to generate profits, and that providing this measure should allow interested persons to monitor operational improvements. We use a best-in-class target across all LP sites that allows us to optimize capital investments, focus maintenance and reliability improvements, and improve overall equipment efficiency. It should be noted that other companies may present OEE data differently, and therefore, as presented by us, OEE data may not be comparable to similarly titled measures reported by other companies.

Previous wording

OEE for the three and six months ended June 30, 2025 and 2024, for each of our segments is listed below:

Current wording

OEE for the three and nine months ended September 30, 2025 and 2024, for each of our segments is listed below:

Previous wording

Percent changes in average net sales prices and unit shipments for the three and six months ended June 30, 2025, compared to the corresponding periods in 2024, were as follows:

Current wording

Percent changes in average net sales prices and unit shipments for the three and nine months ended September 30, 2025, compared to the corresponding periods in 2024, were as follows:

Previous wording

For the three and six months ended June 30, 2025, Siding net sales increased year-over-year by $45 million and $86 million, respectively, reflecting higher sales volumes and higher selling prices. ExpertFinish net sales increased by 17% and 20% for the three and six months ended June 30, 2025, respectively, compared to the prior-year periods.

Current wording

For the three and nine months ended September 30, 2025, Siding net sales increased year over year by $22 million and $108 million, respectively, reflecting higher selling prices. The nine-month increase also included a benefit from higher sales volume. Within the Siding segment, ExpertFinish® net sales increased by 31% and 24% for the three and nine months ended September 30, 2025, respectively, compared to the prior-year periods.

Previous wording

Adjusted EBITDA for the Siding segment increased by $20 million and $36 million for the three and six months ended June 30, 2025, respectively, compared to the prior-year periods. This growth was driven by higher sales volume and strong pricing, partially offset by strategic investments in sales and marketing—$2 million in the quarter and $7 million year to date—as well as tariff expenses of $3 million for the quarter and $5 million year to date.

Current wording

Adjusted EBITDA for the Siding segment decreased year over year by $6 million for the three months ended September 30, 2025, with improved pricing of $18 million more than offset by $13 million mill overhead and inventory absorption, $5 million of strategic investments in sales and marketing, $3 million of SG&A, and $2 million of tariff expenses. Adjusted EBITDA increased $30 million for the nine months ended September 30, 2025, compared to the prior-year period. This growth was driven by higher sales volume and higher selling prices of $70 million, partially offset by strategic investments in sales and marketing of $12 million, $13 million of mill overhead and inventory absorption, $7 million of tariff expenses, and $5 million of SG&A.

Previous wording

The OSB segment manufactures and distributes OSB structural panel products, including the innovative value-added OSB product portfolio known as LP® Structural Solutions (which includes LP® TechShield® Radiant Barrier, LP WeatherLogic® Air & Water Barrier, LP Legacy® Premium Sub-Flooring, LP NovaCore® Thermal Insulated Sheathing, LP® FlameBlock® Fire-Rated Sheathing, LP® TopNotch® 350 Durable Sub-Flooring) and LP® Oriented Strand Board.

Current wording

The OSB segment manufactures and distributes OSB structural panel products, including the innovative value-added OSB product portfolio known as LP® Structural Solutions (which includes LP® TechShield® Radiant Barrier Sheathing, LP WeatherLogic® Air & Water Barrier, LP Legacy® Premium Sub-Flooring, LP® FlameBlock® Fire-Rated Sheathing, and LP® TopNotch® 350 Durable Sub-Flooring) and LP® Oriented Strand Board.

Previous wording

Percent changes in average net sales prices and unit shipments for the three and six months ended June 30, 2025, compared to the corresponding periods in 2024, were as follows:

Current wording

Percent changes in average net sales prices and unit shipments for the three and nine months ended September 30, 2025, compared to the corresponding periods in 2024, were as follows:

Previous wording

For the three and six months ended June 30, 2025, OSB net sales decreased by $101 million and $147 million, respectively, compared to the same prior-year periods. These decreases were primarily driven by lower OSB prices.

Current wording

For the three and nine months ended September 30, 2025, OSB net sales decreased year over year by $74 million and $221 million, respectively. These decreases were primarily driven by lower OSB prices and a decline in sales volume.

Previous wording

Adjusted EBITDA for the OSB segment for the same periods decreased year-over-year by $106 million and $143 million, respectively, also reflecting the impact of lower OSB prices.

Current wording

Adjusted EBITDA for the OSB segment for the same periods decreased year over year by $60 million and $203 million, respectively, also reflecting the impact of lower OSB prices and a decline in sales volume.

Previous wording

For the three months ended June 30, 2025, net sales and Adjusted EBITDA declined year-over-year by $3 million and $1 million, respectively, primarily due to lower OSB prices.

Current wording

For the three and nine months ended September 30, 2025, net sales decreased year over year by $8 million and $6 million, respectively, primarily due to lower OSB prices.

Previous wording

Our other products segment includes other minor products, services, and closed operations, which do not qualify as discontinued operations. Additionally, this segment includes corporate expenses that are not allocated, such as general administrative costs and stock-based compensation. During 2024, the equity method investment held by Entekra Holdings LLC, our off-site framing operation, sold substantially all of its net assets. Other net sales were $2 million and $4 million for the three and six months ended June 30, 2025, respectively, as compared to $2 million and $5 million for the corresponding periods in 2024, respectively. Adjusted EBITDA was $(10) million and $(20) million for the three and six months ended June 30, 2025, respectively, as compared to $(11) million and $(19) million for the corresponding periods in 2024, respectively.

Current wording

Our other products segment includes other minor products, services, and closed operations, which do not qualify as discontinued operations. Additionally, this segment includes corporate expenses that are not allocated, such as general administrative costs and stock-based compensation. During 2024, the equity method investment held by Entekra Holdings LLC, our off-site framing operation, sold substantially all of its net assets. Other net sales were $2 million and $6 million for the three and nine months ended September 30, 2025, respectively, as compared to $2 million and $7 million for the corresponding periods in 2024, respectively. Adjusted EBITDA was $(13) million and $(33) million for the three and nine months ended September 30, 2025, respectively, as compared to $(12) million and $(32) million for the corresponding periods in 2024, respectively.

Previous wording

Selling, general, and administrative expenses were $79 million and $154 million for the three and six months ended June 30, 2025, respectively, compared to $71 million and $140 million for the corresponding periods in 2024, respectively. The year-over-year increase in selling, general, and administrative expenses for both periods was driven by higher employee compensation.

Current wording

Selling, general, and administrative expenses were $95 million and $250 million for the three and nine months ended September 30, 2025, respectively, compared to $75 million and $215 million for the corresponding periods in 2024, respectively. The year-over-year increase in selling, general, and administrative expenses for both periods was primarily driven by higher employee compensation.

Previous wording

We recognized an estimated tax provision of $19 million and $45 million in the three and six months ended June 30, 2025, respectively, as compared to $53 million and $94 million for the comparable periods in 2024, respectively. Each quarter the income tax accrual is adjusted to the latest estimate and the difference from the previously accrued year-to-date balance is recorded in the current quarter. For the six months ended June 30, 2025, and 2024, the primary differences between the U.S. statutory rate of 21% and the total effective tax rates of 26% and 25%, respectively, relate to state income tax and inflationary and foreign currency exchange adjustments.

Current wording

We recognized an estimated tax provision of $9 million and $54 million in the three and nine months ended September 30, 2025, respectively, as compared to $23 million and $117 million for the comparable periods in 2024, respectively. Each quarter the income tax accrual is adjusted to the latest estimate and the difference from the previously accrued year-to-date balance is recorded in the current quarter. For the nine months ended September 30, 2025, the primary difference between the U.S. statutory rate of 21% and the total effective tax rate of 26% relates to state income tax and non-deductible compensation. For the nine months ended September 30, 2024, the primary difference between the U.S. statutory rate of 21% and the total effective tax rate of 25% relates to state income tax.

Previous wording

During the six months ended June 30, 2025 and 2024, cash provided by operations was $226 million and $317 million, respectively. The decrease in cash provided by operations was primarily related to lower net income and changes in working capital.

Current wording

During the nine months ended September 30, 2025 and 2024, cash provided by operations was $315 million and $500 million, respectively. The decrease in cash provided by operations was primarily related to lower net income and changes in working capital.

Previous wording

During the six months ended June 30, 2025 and 2024, cash used in investing activities was $132 million and $61 million, respectively, relating to capital expenditures. The year-over-year increase in capital expenditures was primarily related to higher spend on growth and sustaining maintenance projects in the current year.

Current wording

During the nine months ended September 30, 2025 and 2024, cash used in investing activities was $216 million and $122 million, respectively, relating to capital expenditures. The year-over-year increase in capital expenditures was primarily related to higher spend on growth and sustaining maintenance projects in the current year.

Previous wording

Capital expenditures in 2025 are expected to be approximately $350 million. We expect to fund our short-term and long-term capital expenditures in 2025 through cash on hand, cash generated from operations, and available borrowing under our Amended Credit Facility, as necessary.

Current wording

Capital expenditures in 2025 are expected to be approximately $315 million. We expect to fund our short-term and long-term capital expenditures in 2025 through cash on hand, cash generated from operations, and available borrowing under our Amended Credit Facility, as necessary.

Previous wording

During the six months ended June 30, 2025, cash used in financing activities was $105 million, which includes $61 million to repurchase shares of LP common stock under the 2024 Share Repurchase Program (defined below) in the three months ended March 31, 2025. Additionally, we paid cash dividends of $39 million and used $3 million to repurchase stock from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans. In connection with other financing activities, we paid $2 million of debt issuance costs related to the amendment of our credit facility.

Current wording

During the nine months ended September 30, 2025, cash used in financing activities was $124 million, which included $61 million for share repurchases of LP common stock under the 2024 Share Repurchase Program (defined below) in the three months ended March 31, 2025. Additionally, we paid cash dividends of $58 million and used $3 million to repurchase stock from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans. In connection with other financing activities, we paid $2 million of debt issuance costs related to the amendment of our credit facility.

Previous wording

During the six months ended June 30, 2024, cash used in financing activities was $157 million, which includes $115 million to repurchase shares of LP common stock under the share repurchase program authorized by LP's Board of Directors in May 2022. Additionally, during this period we had $37 million of dividend payments and $5 million of stock repurchases from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans.

Current wording

During the nine months ended September 30, 2024, cash used in financing activities was $252 million, which included $188 million for share repurchases of LP common stock under the share repurchase program authorized by LP’s Board of Directors in May 2022. Additionally, during this period we had $56 million of dividend payments and $8 million of stock repurchases from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans.

Previous wording

During the second quarter of 2025, $17 million in non-cash, pre-tax impairment charges were recorded. These included $11 million related to acquired equipment that will not be utilized in future operations, $4 million related to property, plant, and equipment associated with a facility closure, and $2 million primarily related to an operating lease asset associated with a previously closed facility.

Current wording

During the second quarter ended June 30. 2025, $17 million in non-cash, pre-tax impairment charges were recorded. These included $11 million related to acquired equipment that will not be utilized in future operations, $4 million related to property, plant, and equipment associated with a facility closure, and $2 million primarily related to an operating lease asset associated with a previously closed facility.