LOUISIANA-PACIFIC CORP

Previous wording

Demand for our products correlates positively with new home construction, especially new single-family 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 April 29, 2026. Actual single-family housing starts were approximately 6% lower for the three months ended March 31, 2026, as compared to the same period in 2025. Actual multi-family housing starts for the three months ended March 31, 2026, were approximately 19% higher as compared to the same period in 2025. Repair and remodeling activity is difficult to reasonably measure, but the many indications suggest that repair and remodeling activity has declined modestly year-over-year.

Current wording

Demand for our products correlates positively with new home construction, especially new single-family 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 July 17, 2026. Actual single-family housing starts were approximately 4% and 5% lower for the three and six months ended June 30, 2026, respectively, as compared to the same periods in 2025. Actual multi-family housing starts for the three and six months ended June 30, 2026, were approximately 8% and 15% higher, respectively, as compared to the same periods in 2025. Repair and remodeling demand is difficult to measure precisely due to diversity of remodeling projects, however, available market indicators suggest activity is roughly flat compared to the prior year.

Previous wording

Our Siding products are specialty building materials and are subject to competition from various siding and cladding technologies, including vinyl, stucco, wood, fiber cement, brick, and others. We believe we are the largest manufacturer of engineered wood siding in North America and South America. We have consistently grown our Siding segment above the underlying market growth rates. Our Siding segment is generally less sensitive to new housing market cyclicality since a majority of its demand comes from other markets, including off-site structure producers and repair and remodel. Our growth in this market depends upon the continued displacement of vinyl, wood, fiber cement, stucco, bricks, and other alternatives, our product innovation, and our technological expertise in wood and wood composites to address the needs of our customers.

Current wording

Our Siding products are specialty building materials and are subject to competition from various siding and cladding technologies, including vinyl, stucco, wood, fiber cement, brick, and others. We believe we are the largest manufacturer of engineered wood siding in North America and South America. We have consistently grown our Siding segment above the underlying market growth rates. Our Siding segment is generally less sensitive to housing market cyclicality since a majority of its demand comes from other markets, including off-site structure producers and repair and remodel. Our growth in this market depends upon the continued displacement of vinyl, wood, fiber cement, stucco, bricks, and other alternatives, our product innovation, and our technological expertise in wood and wood composites to address the needs of our customers.

Previous wording

When evaluating the Company's performance on a GAAP basis, management utilizes certain non-GAAP financial measures as defined by SEC Regulation G and Regulation S-K Item 10(e). These measures exclude the impact of specific costs, expenses, gains, and losses to evaluate our overall operating performance. Management believes these non-GAAP measures provide users of the financial information with additional meaningful comparison to prior periods, as they generally exclude items that are outside of the normal course of our business or beyond management's control. It is important to note that 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, Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS (as each defined below) are non-GAAP measures that are used by management and external users of our condensed consolidated financial statements such as investors, industry analysts, and lenders.

Current wording

When evaluating the Company's performance on a U.S. GAAP basis, management utilizes certain non-GAAP financial measures as defined by SEC Regulation G and Regulation S-K Item 10(e). These measures exclude the impact of specific costs, expenses, gains, and losses to evaluate our overall operating performance. Management believes these non-GAAP measures provide users of the financial information with additional meaningful comparison to prior periods, as they generally exclude items that are outside of the normal course of our business or beyond management's control. It is important to note that 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, Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS (as each defined below) are non-GAAP measures that are used by management and external users of our condensed consolidated financial statements such as investors, industry analysts, and lenders.

Previous wording

During the first quarter of 2026, the Company updated the definition of Adjusted Income to exclude foreign currency gains and losses. These gains and losses primarily arise from the remeasurement of all monetary assets and liabilities including intercompany notes that are denominated in a different currency than the entity's functional currency. The exclusion of these items helps management compare changes in operating results between periods that might otherwise be obscured due to currency fluctuations. The Company believes this exclusion provides investors with a clearer view of underlying operating performance by removing the effects of currency fluctuations that are largely outside of the Company's control and do not reflect its core business activities. For comparability and consistency, all prior period Adjusted Income and Adjusted Diluted EPS measures have been recast to conform to the current presentation. The impact of this update for the three months ended March 31, 2025, resulted in an increase to Adjusted Income and Adjusted Diluted EPS of $4 million and $0.06, respectively.

Current wording

During the first quarter of 2026, the Company updated the definition of Adjusted Income to exclude foreign currency gains and losses. These gains and losses primarily arise from the remeasurement of all monetary assets and liabilities including intercompany notes that are denominated in a different currency than the entity's functional currency. The exclusion of these items helps management compare changes in operating results between periods that might otherwise be obscured due to currency fluctuations. The Company believes this exclusion provides investors with a clearer view of underlying operating performance by removing the effects of currency fluctuations that are largely outside of the Company's control and do not reflect its core business activities. For comparability and consistency, all prior period Adjusted Income and Adjusted Diluted EPS measures have been recast to conform to the current presentation. The impact of this update for the three and six months ended June 30, 2025, was an increase to Adjusted Income of $6 million and $9 million, respectively, and an increase to Adjusted Diluted EPS of $0.08 per share and $0.14 per share, respectively.

Previous wording

The following table sets forth housing starts for the three months ended March 31, 2026 and 2025 (in thousands):

Current wording

The following table sets forth actual housing starts data reported by the U.S. Census Bureau, as published through July 17, 2026, for the three and six months ended June 30, 2026 and 2025 (in thousands):

Previous wording

The following table sets forth sales volumes for the three months ended March 31, 2026 and 2025 (in MMSF):

Current wording

The following table sets forth sales volumes for the three and six months ended June 30, 2026 and 2025 (in MMSF):

Previous 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.

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 on 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 months ended March 31, 2026 and 2025, for each of our reportable segments is listed below:

Current wording

OEE for the three and six months ended June 30, 2026 and 2025, for each of our reportable segments is listed below:

Previous wording

The Company conducts business through two reportable segments: Siding and OSB. Other comprises our South American operations and other products that are not individually significant. See “Note 11. Selected Segment Data” of the Notes to the Condensed Consolidated Financial Statements included in “Item 1. Financial Statements” of this quarterly report on Form 10-Q for further information regarding our segments.

Current wording

The Company conducts business through two reportable segments: Siding and OSB. Other comprises our South American operations and other products and services that are not individually significant. See “Note 11. Selected Segment Data” of the Notes to the Condensed Consolidated Financial Statements included in “Item 1. Financial Statements” of this quarterly report on Form 10-Q for further information regarding our segments.

Previous wording

Percent changes in average net sales prices and unit shipments for the three months ended March 31, 2026, compared to the corresponding period in 2025, were as follows:

Current wording

Percent changes in average net sales prices and unit shipments in Siding for the three and six months ended June 30, 2026, compared to the corresponding periods in 2025, were as follows:

Previous wording

For the three months ended March 31, 2026, Siding net sales decreased year over year by $42 million reflecting higher prices offset by lower volumes. The increase in pricing was attributable to the annual price increase, favorable sales mix, and a slight reduction in rebate expense compared to the prior year.

Current wording

Siding net sales decreased for the three and six months ended June 30, 2026 due to lower volumes, partially offset by higher prices. The increase in pricing was attributable to both the annual price increase and favorable mix.

Previous wording

Percent changes in average net sales prices and unit shipments for the three months ended March 31, 2026, compared to the corresponding period in 2025, were as follows:

Current wording

Percent changes in average net sales prices and unit shipments in OSB for the three and six months ended June 30, 2026, compared to the corresponding periods in 2025, were as follows:

Previous wording

For the three months ended March 31, 2026, OSB net sales decreased year over year by $99 million primarily driven by lower OSB prices and a decline in sales volume.

Current wording

For the three and six months ended June 30, 2026, OSB net sales decreased year over year by $68 million and $167 million, respectively, primarily driven by lower OSB prices and a decline in sales volumes.

Previous wording

Adjusted EBITDA for the OSB segment for the same period decreased year over year by $66 million reflecting the impact of lower OSB prices and a decline in sales volumes.

Current wording

Adjusted EBITDA for the same periods decreased year over year by $40 million and $106 million, respectively, reflecting the impact of lower OSB prices and a decline in sales volumes.

Previous wording

Other operations include our South American business that manufactures and distributes OSB structural panels and siding products in South America and certain export markets. Our other operations also include timber and timberlands as well as other minor products, services, and closed operations, which do not qualify as discontinued operations. Additionally, other includes unallocated corporate expenses. Other net sales decreased by $8 million for the three months ended March 31, 2026, primarily due to a decline in OSB sales volumes. Adjusted EBITDA for the same period decreased year over year by $9 million, driven primarily by a decline in Other net sales.

Current wording

Other operations include our South American business that manufactures and distributes OSB structural panels and siding products in South America and certain export markets. Other operations also include timber and timberlands as well as other products, services, and closed operations, which do not qualify as discontinued operations. Additionally, Other includes unallocated corporate expenses.

Previous wording

Selling, general, and administrative expenses were $78 million for the three months ended March 31, 2026, compared to $75 million for the corresponding period in 2025. The year-over-year increase in selling, general, and administrative expenses was primarily driven by higher stock compensation expense.

Current wording

Selling, general, and administrative expenses were $80 million and $158 million for the three and six months ended June 30, 2026, respectively, compared to $79 million and $154 million for the corresponding periods in 2025. The year-over-year increase in selling, general, and administrative expenses was due to higher inflationary costs.

Previous wording

We recognized a total tax provision of $9 million in the three months ended March 31, 2026, compared to $26 million for the corresponding period in 2025. Each quarter, the income tax accrual is updated based on the latest estimate, and any difference from the previously accrued year-to-date balance is recorded in the current quarter. For the three months ended March 31, 2026, the primary difference between the U.S. statutory rate of 21% and the total effective tax rate of 25% relates to state income tax. For the three months ended March 31, 2025, the primary differences between the U.S. statutory rate of 21% and the total effective tax rate of 22% relate to state income tax and inflationary and foreign currency exchange adjustments.

Current wording

We recognized a total tax provision of $8 million and $17 million in the three and six months ended June 30, 2026, respectively, compared to $19 million and $45 million for the corresponding periods in 2025. Each quarter, the income tax accrual is updated based on the latest estimate, and any difference from the previously accrued year-to-date balance is recorded in the current quarter. For the six months ended June 30, 2026, the primary differences between the U.S. statutory rate of 21% and the total effective tax rate of 24% relate to foreign income tax and inflationary and foreign currency exchange-related adjustments. For the six months ended June 30, 2025, the primary differences between the U.S. statutory rate of 21% and the total effective tax rate of 24% relate to state income tax and inflationary and foreign currency exchange-related adjustments.

Previous wording

Our principal sources of liquidity are existing cash and investment balances, cash generated by our operations, and our ability to borrow under such credit facilities as we may have in effect from time to time. We assess our liquidity in terms of our ability to generate cash to fund our short- and long-term cash requirements. As such, we project our anticipated cash requirements as well as cash flows generated from operating activities to meet those needs. We anticipate long-term cash uses may also include strategic acquisitions. On a long-term basis, we expect to rely on our credit facilities in effect from time to time for any long-term funding not provided by operating cash flows. We may also, from time to time, issue and sell equity, debt, or hybrid securities or engage in other capital market transactions.

Current wording

Our principal sources of liquidity are existing cash and investment balances, cash generated by our operations, and our ability to borrow under such credit facilities as we may have in effect from time to time. We assess our liquidity in terms of our ability to generate cash to fund our short- and long-term cash requirements. As such, we project our anticipated cash requirements as well as cash flows generated from operating activities to meet those needs. We anticipate that long-term cash uses may also include strategic acquisitions. On a long-term basis, we expect to rely on our credit facilities in effect from time to time for any long-term funding not provided by operating cash flows. We may also, from time to time, issue and sell equity, debt, or hybrid securities or engage in other capital market transactions.

Previous wording

During the three months ended March 31, 2026, cash used in operations was $38 million. During the same period in 2025, cash provided by operations was $64 million. The decrease in cash provided by operations was primarily related to lower net income and changes in working capital.

Current wording

During the six months ended June 30, 2026, cash provided by operations was $102 million. During the same period in 2025, cash provided by operations was $226 million. The decrease in cash provided by operations was primarily related to lower net income and changes in working capital.

Previous wording

During the three months ended March 31, 2026 and 2025, cash used in investing activities was $61 million and $64 million, respectively, relating to capital expenditures.

Current wording

During the six months ended June 30, 2026 and 2025, cash used in investing activities was $120 million and $132 million, respectively, relating to capital expenditures.

Previous wording

Capital expenditures in 2026 are expected to be approximately $390 million. We expect to fund our short-term and long-term capital expenditures in 2026 through cash on hand, cash generated from operations, and available borrowing under our Amended Credit Facility, as necessary.

Current wording

Capital expenditures in 2026 are expected to be approximately $320 million. We expect to fund our short-term and long-term capital expenditures in 2026 through cash on hand, cash generated from operations, and available borrowing under our Amended Credit Facility, as necessary.

Previous wording

During the three months ended March 31, 2026, cash used in financing activities was $29 million, which included $21 million of cash dividends paid and $8 million to repurchase stock from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans.

Current wording

During the six months ended June 30, 2026, cash used in financing activities was $47 million, which included $42 million of cash dividends paid and $5 million to repurchase stock from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans.

Previous wording

During the three months ended March 31, 2025, cash used in financing activities was $87 million, which included $61 million for share repurchases of LP common stock under the 2024 Share Repurchase Program (as defined below). Additionally, we paid cash dividends of $20 million and $5 million to repurchase stock from employees in connection with income tax withholding requirements associated with our employee stock-based compensation plans.

Current wording

During the six months ended June 30, 2025, cash used in financing activities was $105 million, which included $61 million for share repurchases of LP common stock under the 2024 Share Repurchase Program (as defined below). 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.

Previous wording

In November 2022, LP entered into the Credit Agreement with American AgCredit, PCA, as administrative agent and sole lead arranger, CoBank, ACB, as letter of credit issuer, and certain other lender parties (the Credit Agreement), relating to its revolving credit facility. On March 26, 2025, LP entered into the First Amendment to Second Amended and Restated Credit Agreement (the First Amendment) with American AgCredit, PCA, as administrative agent, CoBank, ACB, as letter of credit issuer, and the lenders and voting participants party thereto, which amended the Credit Agreement (the Amended Credit Agreement) to (1) increase the aggregate principal amount for the credit facility from $550 million to $750 million, (2) increase the sub-limit for letters of credit from $60 million to $75 million, (3) change the interest rate for revolving borrowing, (4) change the capitalization ratio limit, and (5) extend the maturity date to March 26, 2032. As of March 31, 2026, there were no outstanding borrowings under the Amended Credit Facility.

Current wording

In November 2022, LP entered into a Credit Agreement with American AgCredit, PCA, as administrative agent and sole lead arranger, CoBank, ACB, as letter of credit issuer, and certain other lender parties (the Credit Agreement), relating to its revolving credit facility. On March 26, 2025, LP entered into the First Amendment to Second Amended and Restated Credit Agreement (the First Amendment) with American AgCredit, PCA, as administrative agent, CoBank, ACB, as letter of credit issuer, and the lenders and voting participants party thereto, which amended the Credit Agreement (the Amended Credit Agreement) to (1) increase the aggregate principal amount for the credit facility from $550 million to $750 million (the Amended Credit Facility), (2) increase the sub-limit for letters of credit from $60 million to $75 million, (3) change the interest rate for revolving borrowing, (4) change the capitalization ratio limit, and (5) extend the maturity date to March 26, 2032. As of June 30, 2026, there were no outstanding borrowings under the Amended Credit Facility.

Previous wording

No impairment was recognized during the three months ended March 31, 2026.

Current wording

No impairment was recognized during the three and six months ended June 30, 2026.