LPX - Earnings call 3 2023 | Louisiana-Pacific Corporation

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Operator

Good day, and welcome to the Q3 2023 Louisiana-Pacific Corporation Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker, Mr. Aaron Howald, Vice President of Investor Relations and Business Development. Please go ahead, sir.

Aaron Howald

good and operator, you, morning, everyone. Thank for the third you updated year joining well us for results full LP's discuss outlook. quarter our to as Thank of as XXXX Aaron, President, is My LP's I Business and Vice name Development. Investor and Relations am are Officer. me Financial Chief Executive LP's Southern, Officer; With Brad LP's Alan and morning Haughie, this Chief

available IR web page, During this refer will LP's we to a is on investor.lpcorp.com. morning's call, presentation that is which

detailing release LP's available also there with and is model. other press materials and filing X-K Our strategy our along business sustainable earnings

Today's as than that discussion supplemented further The contains and here content the the contain financial will also reading forward-looking statements reference incorporate slides. are presentation. described X by in non-GAAP my and this earnings Appendix metrics presentation that X of morning's the on X-K. rather Slides reconciliations will of I

with Brad. over I'll turn And the call to that,

William Southern

for thank results year our and full you Aaron, Thanks, us all QX LP's to and discuss outlook. joining

by our LP's for The stronger teams was which will a and third milestones It Siding achieved in inclusive continuing and more sustainability, far both culture. key quarter our which on for focus strongest also quarter recognize we of OSB. and building growth the was a one of for year

at X overall a QX that sell-through in EBITDA, year generated higher Page margin the inventory than year. X% LP in OSB which and million higher last last EBITDA $XXX quarter, only presentation and year net highlights sales of the last quarter. and financial to led the earned Siding than prices $XXX with for the result of shows LP normalization less in in lower million was QX improved XX%

OSB in high exceeded our end LP guidance September. range result, prices despite of a the falling As

liquidity. via quarter revolving repaid and translated quarter million EBITDA million ended $XXX credit million cleanly after with and LP capital. the in million the in ended in We $XXX investing our operating sustaining million with and returning in $XXX cash $XX in growth cash dividends hand $XX over flow, and on $XXX to million facility The very

shows housing file December that Page on Despite relative quarter this beat basis, XX order Siding X% a and trailing very XX-month up a the year. on down last the managed early X%. points. difficult growth basis. remained Remember for on XX%, trailing volume record single-family we only X until comp presentation but was sales volume Starts a revenue to starts volume Siding the of SmartSide and as on were of percentage Siding by down prices Siding market XX-month were housing

ExpertFinish chart see you the pie of was can As the X% to volume in the right, stable in at quarter.

and the rates inventory sales destocking of levels. finally sell-through order XXXX, saw file transitioned late the Siding QX a normalization by dampened of half were from managed first year. we after last In inventory

facing that Siding As quarter expected third volumes challenges, affordability the the increasing compared uncertainty, and in higher and and market saw higher selling despite prices interest economic average QX. rates is to business elevated sequentially

patterns levels channel believe with now with minimal are experiencing consistent we a As seasonal the headwinds result, are pattern normal inventory that destocking. lingering from order we

teams to the resumption the the I demonstrated this period digestion cadence proud takes through of inventory work dedication a been process. on order order first we sales time. Siding and Siding the that and the managed as This of was not a time before and perseverance business normal file, has am operations

am well I expansion newest the we the to after welcome business new that officially in is are to past the to and want additions call Bath confident for opened want all conversions Last diverse and capacity to third our in the month, I years Sagola. a we efficient Before X and Alan, prefinishing the execution safe siding we positioned of facility I of serve. Bath, proud ExpertFinish. Bath to growth additional over scale, the New York. recent our resume and mention efficiency of team in brings Siding markets officially the facility in accomplishments This the hand a few Holton in enhanced quarter. I geographic to

In the published as third value-added our sustainability product environmental third report quarter, declarations of OSB Structural Solutions products. well for the LP as portfolio

and integrated Barrier, WeatherLogic all than like emitted products more Solutions their carbon life sequester and Structural water and TechShield legacy during air Radiant sheating flooring with manufacturing is barrier cycle.

cement competing to beat LP's where portfolio predominantly of comes is in positive with that building Siding OSB impact shareholders when builders, environment on durable combined while our or best-in-class contractors, to great having is very the products are sustainable curb-appeal LP's that home suite it wood are sustainable This products wood made forest also engineered responsible for confident with a vinyl, carbon-negative hard we means of the and engineered customers environment. solutions. and most and products and products deliver siding Our in can impact of resources notable and management positive a

Lastly, before And to team was in Greatest proud call reward. I'm the workplace welcome Middle I And by his trying of stop Tennessee. safe to members we a by local and and culture that U.S.A. own to we am as to say the never our a named all building company and inclusive the feel Workplaces, our where while [indiscernible] LP one make. Alan, Newsweek will top progress I newspaper improve, continue and our of to of encouraged America's turn over happy TODAY as

And call Alan. with that, to the turn I will

Alan J. Haughie

Slide for Brad. quarter the and of Thanks, presentation waterfall is third the X year-over-year revenue Siding. EBIT

comp and a admittedly, volume of high presents Siding difficult last quarter this The year a and year. revenue watermark was for both third

the volumes and of sequentially X%, predicted, by prices year as X% second this and quarter However, over improved respectively.

than percentage better primed. other revenue added a Volume basis, On and of year-over-year with were increase million list favorable product down impact EBITDA. XX% January's its price mix of combined X up prices $XX points. holding and was The ExpertFinish last ground

including year. trend this to now and million I'm this of ramp-up quarter, million carried quarter $XX prefinishing we recap of the take The $X waterfall. last is to first costs million Bath the the embedded million million $X ramp-up it $X now in This increase $X moment quarter that facility. for year, going in million the higher conversion $X quarter and is $XX million the $X a second up of the this recently incurred business than and year, third this cost opened the on shows million

recently our in fourth ramping Now the current it the add the margins you incremental burden I the are mentioned about of the thing up. $X Bath detail as facility will, costs weight, to begins that this will Moreover, quarter or of EBITDA these opened million costs. carrying if emphasize

$X about generating despite EBITDA quarter, for just shown the would embedded margin produce Adding EBITDA $X respectable a So the XX% in press I together third with of million referenced an rebuild, as underlying in Dawson the last margin XX%. million waterfall, the column the back of

This slowing million margin by of tailwind helped wage was, inflation. materials, of net of course, delivered on a pressures inflationary $X the raw freight EBITDA which and

EBITDA the higher revenue and drop a revenue cost increase of X offset Slide small third late for story year. The the prices where quarter in to EBITDA and tells quarter, in in price year-over-year OSB, price resulting notwithstanding than controls last the $XX despite volume more added decline. million gains

market the weak. price, environment net volumes, particularly demand than with was higher Despite open overall year softer last

demonstrated not fleet from EBITDA. in star In so million was of only percentage the the cost reduction to $XX OSB which material the operating the OSB response only the the not the dollars, volumes, X deflation lower also other in demand. very market the in of reflects comes removal quarter And efficiently, the [indiscernible], control, of Adding Sagola provided but the point a show but softer run small raw volume curtailments improvement OEE. by but or the significantly despite words, efficiency by business

producing As $XXX $XX with dividend revolver. it a our as clean growth shown Brad $XXX of spent returned has via and flow. million on cash X, to shareholders the on million mentioned, million We the draw already capital, million repaid EBITDA $XX million or flow, operating and in cash of was maintenance $XX a quarterly Slide

by at balance little $XXX to September increase million. in cash to result, the million a $XXX at $XX has a As continued subsequently over increased stands currently million. Cash end quarter and

mostly let discuss on already Slide quarter look XXXX, with us CapEx, be for a near-term spending. like lot so will The capital sustaining outlook third full Sagola far spent our on will XX. year having and growth and $XXX running, behind in With the up updated the of respect to capital maintenance. million bulk fourth Finally, and the spend likely quarter is now so me the Bath fourth conversion quarter

Siding our decline that revenue revenue guidance met implies so second expectations, we a we of call a the of full about expect quarter year we on XX%. revenue quarter XX%, largely third internal about Siding fourth quarter our are which the decline reiterating for provided

the based price accounting prices will For OSB OSB, be Under from revenue continue on the Lengths levels quarter. for assumption guidance this XX% we algorithmic to that down to OSB downtime, remain sequentially Friday. market offer the by would model, expect last Random published we at revenue

of prefinished full million we in total and including both expenses some million. would Under assumptions, these businesses, maintenance expect $XX I the the and quarter start-up between to company be Bath EBITDA costs facility earlier referenced $XX

our Siding markets press next currently meet or well We're your capital provide Sagola invest capital XXXX, LP position deploy take most prefinish EBITDA strategy in and the repair flexibility capacity. sufficient with we we and and in capacity to business and before enough one. unchanged revenue yet folks as basically to to If year, flat anticipate offer please for anticipate, not me SmartSide allow a are Now with to but then remains as questions, allocation to the guidance demand. housing is which Bath remodel

recently that the the don't be, capacity, as sufficient on but And know one liquidity exactly and the ability demands needed growth acquired of return responsive time start will demand is prior market amount in of importantly, we remains to when facility when answer, calls to our that in established And shareholders. have when invest meantime, we might cash, well a Wawa, it. converting be to Siding, comes. capital our to remainder allocation significant as earn and the strategy most We

And questions. happy a round to with that, we'll of take be

Operator

Instructions] Seaport [Operator question come with Research Mark And line will from Partners. our Weintraub of the first

Mark Weintraub

order think about But question, think Siding to the we of fourth of to relative against third the going Bath being magnitude, have should we're us. quarter? kind about how I first we quarter it guess if The margins,

Alan J. Haughie

Yes.

as EBITDA the lower are would margin margin course, add And third lower than we this be forecast that even quarter, the excluding in Bath available business lower than to then the are of has costs, on, QX. little you Bath volumes fourth point a we going as the Given more. hit costs the little been margin, the then, quarter, high and have the if a out, a bit

closest the to of probably terms So QX QX of the drivers. approximation is closest in this Siding to approximation most similar-ish the year. in performance, of

Mark Weintraub

in Got at it. I XX% margins And to believe was XX% QX. that EBITDA

Alan J. Haughie

Yes, QX. that was

committing closest to to shape quarter approximation. I'm of number So that but not approximation, is to the necessarily very Yes. similar. the closer

Mark Weintraub

Wawa year, differently you the with we're which costs as bridge unlikely, assuming then we not kind and thinking 'XX? start-up we And from guess with suggest XX cetera, forward $XX the rebuilds, et moving seems that? of think of start-up Or you're it million can press add Bath about about expansion, we next would when I costs versus that Sagola, there,

Alan J. Haughie

about it -- suggest differently. thinking like I I'd slightly

proportion permanently of cost fixed having embedded. facilities. of the a costs those They're are the So

efficiently to already bring very of is Now that able incremental on us course, be place. the largely volume sets to in because up infrastructure

about real is embed the additional have those on next think to a costs way variable about year. set us potentially the volume it. way That's up margin think incremental So it to to high

means we say lot, volume a us immediately it's need they're investment So our and get it comes it's I because to I embedded the EBITDA investment, when they're don't added be run as current an those an rate. future know volume it. but to already recognize in the there, costs incremental again allows in on, that And this from

Mark Weintraub

Okay.

$XX should be that as quasi been embedded onetime or... So, but million of viewed it none would have all

Alan J. Haughie

to and bit that costs a the know cagey, is -- little ramp-up some When don't we some of it's a ramping up, some Yes. onetime because you're great cost. of we I'm product. on example make being of have embedded it we a the good here's

efficiently. ramp essentially run product up as as So learn produced scrapped we that to the some of we is gets

me So to those indeed very bit a it's precise start-up for too but costs, some of those to are early costs a commit separation.

those some is are You're right would infrastructure that inherent will not The be. inefficiencies be fixed that of rest cost that repeated.

Operator

Davidson. D.A. the Yinger with And that line will of come Kurt from

Kurt Yinger

in how normalization as that's Any QX up trended QX. of I of of to on you've And ultimately guess to from this headwind this kind you've much year? pose have incoming as a gone volumes wrapped kind inventory to orders thoughts how here? QX going

William Southern

-- distribution, thing look it's But look historical headwind the some at year we're Well, this a Yes. the the XXXX, you so inventory from it what much that and the on then of you've be easiest not year, for we're for feet of which headwind that of out at to sold last if number has we sales, XXX now getting channel million was. as settle caused you as can if the volume mentioned. moved

As like we file on based normal customers a back today, do in where are order routinely far we history. all as have cadence on the

back and inventory at -- good to our flow seeing across board, we channels across demand order through demand consumer the file. back flowing situation, so the we've And all through real different that through worked we're feel

Kurt Yinger

Got it.

I Okay. some of that what the earlier BuilderSeries, particularly change growth biggest the in XX manufacturers look the within of kind a the the you of And year, Or excited are over volume into kind I of year, the kind across of there at as do different as of going that you're any That's SmartSide, very demand was in growing that, maybe weaker kind then the guess, products next parts drivers next macro guess shed that ExpertFinish, see was above-market of big you the months? helpful. about notwithstanding some environment?

William Southern

repair that the to new excited. So we're share Repair opportunity plant underpenetrated. New Remodel are York we and Kurt, about flat side construction Bath an I'm is due sake the question this Siding just year, remodel would the say to year market spend for behind facility, our is area and highly for active a Holton home seaboard, making next one ExpertFinish if it's of but market, the where our on next you product the it growth, excited in Eastern gain where

capability we just capacity market build as gains. So scale, there's and of for lot opportunity there and a share

new the on the the good depending competitive while provides the BuilderSeries next excited side, have to you're and a on construction of market offering continue our then us builder. with which to -- geography, share portfolio market And And a we go we year compete well. BuilderSeries when products, very with in smaller to about smaller for gain players. comes the And that we're it regional to the possibility to for there in way builders, us underpenetrated more share as to national environment market meaningful decent

Now the Repair tweaking there. above shed, an think meaningful we through I or and the really market going share overall looking market points. more already us is have years getting There's growth the be X builders. -- for or ExpertFinish then we're that few over But next and to high Remodel at with so growth a bigger

Kurt Yinger

guys. hearing good to luck QX, And

William Southern

Kurt. Thanks, you. Thank

Operator

Truist Michael moment One next the our come that for of Securities. And with line from question. Roxland will

Michael Roxland

and of in question siding Kurt's very to on up market homebuilders your follow gain one terms share how are to seems of share. to with It continues gaining be about and want vocal like it. just intend I competitors market share

last little mentioned also underpenetrated with that large here. you're just that the Brian quarter national a mentioned you again, You

gaining more have So And I with want what notable constraining aside to the approach from to and understand you there the conditions doing just is market anything builders? destocking, your from share? been gain builders share with

William Southern

us there's being constraint new no generally sales cycle. than that No, other to

bit market into alien also Let share It's with the for there of the we've us to like caveat a national big builders, products I order had our OSB national that builders on side. files. decent me not very to sell pull-through with TRIM that's and -- strong will little because portfolio

exist So it's the the -- product more a selling products national that with The been primarily do key builders But through we our big channel. is to the that history public of competitive, we believe relationships these is know has product, fact which competitive than OSB through now. we superior. having us

so we've hard progress growth, year, as year the sales we've And this are cycle already into of been I've mentioned. opportunity long And and deals, about made. all we those kind in look but forward that and see a we it's through next optimistic for these working -- as

off building base. very small we're are off from Siding we a And a standpoint, building

with national so the big And builders.

as would retain year, to for it So least grab pretty or there and once able will the so at you're single substantially encouraged it or to good what are the of get least, they ability us for supply we're it. multiyear be is thing these at about, is us about but surety some time. But take deals a

Michael Roxland

one the that them quick price XX in their your is use maybe pretty color. in competitors. then they've gain appreciate over early trying understanding, been on to believe could pricing I And so. increase have or -- I you follow-up to the something one my Is builders months that terms against just share? maybe Use Siding it. of January. advantage with Got XX last your and as aggressive that with

William Southern

a bit success just Well, there's critical mean, or it answered one to -- when package little the to I is than obviously, comes the of whole these big cost I generally programs, there. that against competitor. more price

obviously if competitor our in price these deals. that mean, favor gets to in And that the a back us, box so anyway. work yes, gets has typically, But ticked end worked than kind higher of out I a

to our of product compete the so really, off product, value where ease aesthetics the And of and the is of quality which the proposition trying is we're the installation.

other probably mentioned, XXX And then, the competitive of lead, as though, well. we're price builder conversation. competitive on as so to pricing the be call, of have that's SmartSide times end the as to times obviously, X the got we've on this a on day, able or be I've at we product bringing all well how finally, advantages and And we to X as already

Michael Roxland

XQ. luck in Good

William Southern

Thanks, Mike.

Operator

the our One with Maklari Goldman And Sachs. next moment question. of for will come from Susan that line

Susan Maklari

is segment. decline question Is the fourth had there that, about that you in think was mentioned was Siding and impacting anything first My that guide going of the what as or fairly part quarter saw substantial you that shed that's is business demand a you during changed that through there?

William Southern

cadence demand think business what more good reported what there. how shed I a results. active rebounded we this has will I good last all a back are feel was the a our given do for has QX it that to bit overall call But all or year little also and would reiterate been been just normal on have those from No, back the -- file. bit at of suppressed that customers year. we of order

And share, have as so pulls and little build they sell time we are call so in a of do folks builds spring. the is typically, now product from the seeing of then this more to in there on, some to a and prep bit inventory

segment. expecting increase we QX so pretty in see similar QX late demand that to forward. early to look -- expecting And pulls Product but are strong. as typically, We're we're in that

back And it than the we normal XXXX demand so a to kind were what and compared all in I probably seeing channels, will say to normal call though less would I little is XXXX. other the of

Susan Maklari

helpful... That's Okay.

Alan J. Haughie

guide January QX our we so price general advance of limited repeat something I have fact the ability the reap last year it. that audience have we does that where include Sue, to increase, are we don't to partly for prebuy as in well. limiting a Siding revenue add for of The

So include on [indiscernible]. the a does QX limit guide

Susan Maklari

just a your fourth they and XXXX? the over of in you helpful. bit public inventories builders of And that about seeing think sort move as products there? they're maybe even or are in there, the structural to you for their trends Can you thinking recent Okay. tone about of that solution for into we quarter turning potential the including bit a channel the in how parts XXXX? early comment big what maybe those you're and When OSB, contrast about from the think especially volumes large some perhaps more And about a minute. the segment, think That's OSB to then

William Southern

for channel quickly can Well, look, world. as inventory today, I say, would of in to normal lean slightly situation OSB for, remains, in the pretty the currently change that OSB

happen there's staying was X right build. -- you So but order I any but file over now. mean would X our know never or time, I typically, weeks normal Siding, meaningful I can it unlike is really OSB -- at pretty inventory understand, for a

we're So we're having shortening -- not not it.

so And I inventories are. where good about feel

seasonal mean the component of for seen normal couple think of first January. there's with I That's builder to screwed what seasonality the The week Thanksgiving all Thanksgiving of before beginning do of I weeks going pre-COVID, us. through be some up demand historically. probably the -- we've to COVID

see decline, Thanksgiving I time the not surprised around to be would again, So OSB demand frame. the

going across to one year our inventories Typically, with. lean can channel are they of as the with partners live kind its

of we we forward back a get looking then then So also bit get season. are typically and a pop that negatively they start impacting to little from the demand. building holidays the spring And once folks

this for normal OSB and for So I'm both to expecting return year. this seasonality Siding

middle We middle have planning the had of winters, so apparent. accordingly. slowing businesses I of either last respond as over January. the becomes demand, to see see We we're down from personally have in to But November real both or building up ability demand obviously can X that not

Operator

moment from with Ketan will line come One the for question, our that Mamtora of next BMO. and

Ketan Mamtora

quick clarification one you just to just said. Alan, what

should read the already So are in as guys price this the out on I you increase market Siding? January with

William Southern

Ketan. that, Yes. answer I'll

a channel. to be tailored channel, communicated is have increase the It by will by are coming. Those We price highly communicating. region,

this different so weeks. January doing in be next that mentioned, we're that. is It way couple will communication going over little X as implementing specific out it a And we're year the of And a price Alan increase. the

months can going allow We'll allowed this prebuys something and have their buy also mitigate year that kind negatively. to prior you history in pick buy that. doing XXX% on -- QX realized us your building QX or of XXX% time like of partners to X purchases to a like of of us our impacting quicker a channel to so we that volume. XXX%, with Historically, as And way buy normal frame probability purchase pricing we're positively the prior

in and the yes, kind purchases manage the of to So price existence, of other increase. that actually is way there piece of prebuy announced of the out prior increase meaningful trying [indiscernible] news limiting to one we're we're by the

Ketan Mamtora

That's very And it. of helpful, rate Sagola Got that your OSB. Brad. follow-up fair one to took curtailments that whether just all then operating on QX? assume in outside of kind And those you it's was quick What continues into QX?

William Southern

running ran So little I capacity And XX% about capacity planning in we're we or were that of QX, more than -- in would about with QX. lower. probably X% for downside a upside. say

slowdown that question, But as capacity way the if out to balance capacity see of we'll we're out tend how in demand. the feeling in take planning to I but we we that needs quarter, and get we demand the to responded during demand will more As balance that's our a quarter, we our operate of we're really to half latter to Sue's the that order our make customers' not sure file. satisfy

Operator

moment our and line next for One with of TD the Steuart that from come Sean will question, Securities.

Sean Steuart

Can fiber that XXXX on in and us any And resin trends the guidance? versus on of you're QX QX you front? Question a input costs. into that's headed on seeing context embedded for give variance sense

Alan J. Haughie

as of improvement, current QX. that further are trends are at to and we hold we favorable assume bake forecasters, meaning any speaking, Well, levels sort generally we're don't we cautious forecast so XXXX. head we going roughly But into QX in from to QX costs generally as

So there's the tailwind a improved there.

Sean Steuart

progressed quarter Is there as How and quarter? question Okay. that little is just modeling. more than improved anything sequentially, on The bubble And Siding improvement mix much sequentially? the of that price just a is modest a realizations bit one the that encouraging. issue it this inventory through to which seeing

Alan J. Haughie

mostly Yes, it is mix.

ExpertFinish distribution that. particularly business which good things relative, pricing, like strong health nicely, has So

So QX it's, no QX increase. there was to price

the that favorable continuation from mix QX. of So QX to it's fundamentally

Operator

One with moment America. of come question, that Staphos Bank and next of our fine George will for

George Staphos

siding. little a talk about to wanted I bit

any my strategy continue Mike relay year? you of your were And your mentioned one buy next that with for you open -- ability eliminating your distribution somewhat set and on Are you're other talking with that call to you relatedly, analysts, January. peers to progress coming also other that about, commercial ahead I your So the strategy price think customers the could of making they're the was into changes growing. there in any increase of or

You grow large share market want with the to builders.

How imagine you gain the it's make make and bit BuildersSeries want the around thoughts I XX% would you product. have value, a lower do but would the I You to margin trying product to to margin given you're I ultimately additional that have, towards little there. progress want perhaps to the typically know going share. be selling hear

in how you in your with do terms any change share get the to So strategy and what to builders? commercial you the get margin want, given you of to want

Alan J. Haughie

Yes.

on would I sold than more spend little -- on COVID, we for And were cut years, first. constantly say commercial that the of being a as do back allocation during X all me let maybe our marketing So we've out.

this more share versus -- that focus market order into and helped gain growth into on And so we and will us getting file optimize a our mindset. assets resources

we're and years, year more couple we products. the and roll we've business well to mindset Remodel growth of our our And into will support as so -- going as next resources budgets by the as products how and creation be that of be our in more over managed putting allocating and Repair BuilderSeries to certainly together, versus demand a

to the in a on the we retail which is market what aggressive leaning share across into market, board, housing more really get gains. we do in flat here, condition new of everything growing And need to slightly

about thinking the say, to on was right the this engineered the to you're way times On I've competitive sold and about several there. call, the years, you're though, big compared margin will prior builder. BuilderSeries the question, into generally I mentioned lab be siding

not there. big ginormous a secure for skew But that any we to give volume builder a to margin business. So the us up to to where it's hit have really X margin offsets offsetting,

value a market sorry, and First margin a of I'm can market Remodel We're it's significant our opportunity through Repair by increasing gain that It's sell. and all, and Repair our again, the growing also -- way. Remodel, and selling offset. share to ExpertFinish, share be not

so low-cost example, high-scale on those mills, that, the as are Sagola, New all to Second both our York, mills to an average. of take manufacturing mills, side, large compared Bath,

cost we going also bigger facilities, up our impact see as facilities for will forward. we're ramp so that an pre-finishing margins meaningfully And or pressing these opportunity reduction

manage by gotten by channel, is analysis reduction, of area we've customer, cases. cost management and in it we some margin, pricing, So way And constant OEE. pricing a more around how on sophisticated

our that confident manage margin it be ability a on get to to BuilderSeries higher low If is confident SKUs we'll plenty of portfolio had add a margin we've business hypothetically, especially efficient I'm I'm when not going of side on that in our of that opportunities to always in gain more lower our well, portfolio. but margin, got side we've the that, is the we this So platform. say, with you couple margin upper meaningful -- of spread to operating equally

George Staphos

simplistically, bit approach. 'XX or of step. just going more much quickly distribution. little the a you're And way pretty versus change vantage terms versus the X Brad, 'XX on my X same step Any point, maybe Sure. of maybe from a in to approach

William Southern

on largely we've That know the provide more we set and you by is to of focus direct George, major some Yes. have a builder. talked the area about, metropolitan driven model. DCs up

well. as that off benefit customers other The

'XX, through would a that to So in customers product but that we we be continue was delivering into that than -- say to some and delivering and of 'XX. but in And optimizing standpoint more as efficient only we're on that from look not need going no that focus we're into in and honestly for changes and that model. service but strategic that cost cost that efficient will is I volume for other new It growth level advantage, the responsiveness, selling path. doing more to XXXX, way more direct continued direct market pushing more major new

Operator

of Quinn One line Markets. with that question, will from Paul moment and the next RBC for our Capital come

Paul Quinn

of the big operation run the ExpertFinish. Siding It builders a the or sounds rollout penetration and X of to big like successful this levers

knowledge of can builders, So the Like regional you're on the product, so are terms just And more my a of your all is South done manufacturing on siding only [indiscernible]? that penetration and of gains just is increase on you the or the Northeast? is a kind making in BuildersSeries, doing difference? that I there what in of mills there, big

William Southern

the the side. on it's most press that margin foot help market are it remind Creek, being have there. Dawson The or -- to to that which have mills capability. does side will But prices in XX-foot capability pots, primarily that On now. everybody a XX. the where XX sourcing cost length of manufacturing BuilderSeries we is have Obviously, recent converted, to bit Columbia also because in little our we're that Sagola done closer British

SKU lab has XX normal historically Our Okay. been

starts lot that asked you about have of the you the by and the national at big national are, housing being smile. in go the of builders if that's then And builders, they look you country, that big are a penetration. are Well, the where smile driven with where to

We have because markets, good history SmartSides good there. in historically of just Texas, pretty -- Colorado a penetration had

where we're really South focused So penetration, on share. for gain Southeast the market more opportunities Central, be as us to it'd seaboard Atlantic

of that offering builders. Paul. the bigger XX-foot the out been country, even round to just part with there, And I from product the with central say strong we would our have question,

South big and in sweet Central, us incremental Southeast be -- we're that obviously, So gain spot would volume for Mid-Atlantic. up for opportunities to pick us potential business, but is to a the

Paul Quinn

great. That's Okay.

on uplift ExpertFinish 'XX? that 'XX do into we margin think you gains steady & that. how the through should that Is to R, and R expect through that in -- progression be slow Just side about volume or

William Southern

steady finishing more existing and than probably other slow vein our we've than big into Bay. the to line in in to which and say line Green we It's facility put a similar Yes. put Bath,

right seeing are economies of exceeding are scale. We the that expectations. term That's

there change as somewhat in so those will And margin. we be ramp up, a of step

common. above we the margin all Siding margins that the today. be to this a but incremental the lot in we little I for it might of think time bit just by learn do sell at see how the harder decent And and we're quarter, through to see run we you enjoying opportunity scale, as it's a it

Paul Quinn

little in then And looked lastly, what -- Okay. if going forward? weak can the a you South America just could quarter, expect we

William Southern

good across right of business continent. political solid economically lot whole economic America it's there's right South a unrest. now, that -- Unfortunately, a That's now, Yes. and

when but there's bit your kind be down little not economies chaotic strong from no it we of honestly, mean, alarms of from are volumes standpoint. the too we can, So there a I a market share there. lower, discouraging of chaotic, kind a a

a helpful. So is all pricing been countries really bit there. standpoint, from challenging in little the that that's The

capacity a down there. operations have We significant across taken our outages

our way certainly waiting And so pedaling bit our out in it's years really to a we to been hard now. hold which that economies kilter, of XX happening for term, down little get that's South in can are all own that there, and right America,

earnings are about optimistic being think long as in walk this be operate far there. I that we to as headwinds on we somewhat term, the next basically economic through So should potential but down thinking economies facing year similar year the we we're these all as the down there

Alan J. Haughie

everything Can I can South packing, worms, the risk to did shipping is at cost thing and transferring other noncapitalizable. add? and of and America of Entekra's opening assets One we transfer the of

a the the left was $X lot we to You're interested always it doing is is the but a million their of of and corporation about in as so therefore, use that That's QX in whole. equipment I traditional because freight in EBITDA. the quote reflected million cost EBITDA that $X a

no reason not there's include So an to EBITDA.

it So environment that really slightly is. worse made put appear than a top

Operator

I over the back Mr. remarks. session. any Aaron like today's for concludes to call to would question-and-answer now turn Howald closing That

Aaron Howald

we'll further end joining for soon. Thank Okay. everyone. quarter we questions, Stay to operator. call. no third and the safe, you again call our Thank for earnings there. you, connecting LP With look forward Thanks,

Operator

participating. today's concludes for program. all you This Thank

now disconnect. may You

Louisiana-Pacific (LPX) 1 Nov 232023 Q3 Earnings call transcript