UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2023

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 1-7107

 LOUISIANA-PACIFIC CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	93-0609074
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)

1610 West End Avenue, Suite 200, Nashville, TN 37203

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (615) 986 - 5600

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $1 par value	LPX	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	o
Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  o 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes o   No  ý

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 72,043,353 shares of common stock, $1 par value, outstanding as of May 1, 2023.

Except as otherwise specified and unless the context otherwise requires, references to "LP," the “Company,” “we,” “us,” and “our” refer to Louisiana-Pacific Corporation and its subsidiaries.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), provide a “safe harbor” for forward-looking statements to encourage companies to provide prospective information about their businesses and other matters as long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those discussed in the statements. This quarterly report on Form 10-Q contains, and other reports and documents we file with, or furnish to, the Securities and Exchange Commission (SEC) may contain, forward-looking statements. These statements are based upon the beliefs and assumptions of, and on information available to, our management.

The following statements are or may constitute forward-looking statements: (1) statements preceded by, followed by or that include words like “may,” “will,” “could,” “should,” “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “project,” “potential,” “continue,” “likely,” or “future” or the negative or other variations thereof and (2) other statements regarding matters that are not historical facts, including without limitation, plans for product development, forecasts of future costs and expenditures, possible outcomes of legal proceedings, capacity expansion, and other growth initiatives, and the adequacy of reserves for loss contingencies.

Factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include, but are not limited to, the following:

•changes in governmental fiscal and monetary policies, including tariffs and levels of employment;

•changes in general and global economic conditions, including impacts from global pandemics, rising inflation, supply chain disruptions and the military conflict between Russia and Ukraine;

•changes in the cost and availability of capital;

•changes in the level of home construction and repair and remodel activity;

•changes in competitive conditions and prices for our products;

•changes in the relationship between supply of and demand for building products;

•changes in the financial or business conditions of third-party wholesale distributors and dealers;

•changes in the relationship between the supply of and demand for raw materials, including wood fiber and resins, used in manufacturing our products;

•changes in the cost and availability of energy, primarily natural gas, electricity, and diesel fuel;

•changes in the cost and availability of transportation;

•impact of manufacturing our products internationally;

•difficulties in the launch or production ramp-up of newly introduced products;

•impacts from public health issues (including global pandemics) on the economy, demand for our products or our operations, including the actions and recommendations of governmental authorities to contain such public health issues;

•unplanned interruptions to our manufacturing operations, such as explosions, fires, inclement weather, natural disasters, accidents, equipment failures, labor shortages or disruptions, transportation interruptions, supply interruptions, public health issues (including pandemics and quarantines), riots, civil insurrection or social unrest, looting, protests, strikes, and street demonstrations;

•changes in other significant operating expenses;

•changes in currency values and exchange rates between the U.S. dollar and other currencies, particularly the Canadian dollar, Brazilian real, and Chilean peso;

•changes in, and compliance with, general and industry-specific laws and regulations, including environmental and health and safety laws and regulations, the U.S. Foreign Corrupt Practices Act and anti-bribery laws, laws related to our international business operations, and changes in building codes and standards;

•changes in tax laws and interpretations thereof;

•changes in circumstances giving rise to environmental liabilities or expenditures;

•warranty costs exceeding our warranty reserves;

2

•challenges to or exploitation of our intellectual property or other proprietary information by others in the industry;

•the resolution of existing and future product-related litigation, environmental proceedings and remediation efforts, and other legal or environmental proceedings or matters;

•the effect of covenants and events of default contained in our debt instruments;

•the amount and timing of any repurchases of our common stock and the payment of dividends on our common stock, which will depend on market and business conditions and other considerations;

•cybersecurity events affecting our information technology systems or those of our third-party providers and the related costs and impact of any disruption on our business; and

•acts of public authorities, war, political or civil unrest, natural disasters, fire, floods, earthquakes, inclement weather, and other matters beyond our control.

In addition to the foregoing and any risks and uncertainties specifically identified in the text surrounding forward-looking statements, any statements in the reports and other documents filed by us with the SEC that warn of risks or uncertainties associated with future results, events, or circumstances identify important factors that could cause actual results, events, and circumstances to differ materially from those reflected in the forward-looking statements.

The forward-looking statements that we make or that are made by others on our behalf are based on our knowledge of our business and our operating environment and assumptions that we believe to be or will believe to be reasonable when such forward-looking statements were or will be made. As a consequence of the factors described above, the other risks, uncertainties, and factors we disclose below and in the reports and other documents filed by us with the SEC, other risks not known to us at this time, changes in facts, assumptions not being realized or other circumstances, our actual results may differ materially from those discussed in or implied or contemplated by our forward-looking statements. Consequently, this cautionary statement qualifies all forward-looking statements we make or that are made on our behalf, including those made herein and incorporated by reference herein. We cannot assure you that the results or developments expected or anticipated by us will be realized or, even if substantially realized, that those results or developments will result in the expected consequences for us or affect us, our business, our operations or our operating results in the manner or to the extent we expect. We caution readers not to place undue reliance on such forward-looking statements, which speak only as of their dates. We undertake no obligation to revise or update any of the forward-looking statements to reflect subsequent events or circumstances except to the extent required by applicable law.

ABOUT THIRD-PARTY INFORMATION

In this quarterly report on Form 10-Q, we rely on and refer to information regarding industry data obtained from market research, publicly available information, industry publications, U.S. government sources, and other third parties. Although we believe the information is reliable, we cannot guarantee the accuracy or completeness of the information and have not independently verified it.

3

PART I - FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

Condensed Consolidated Statements of Income

Dollar and share amounts in millions, except per share amounts

(Unaudited)

	Three Months Ended March 31,
	2023		2022
Net sales	$	584	$	1,167
Cost of sales	(483)		(547)
Gross profit	101		620
Selling, general, and administrative expenses	(66)		(62)
Other operating credits and charges, net	(5)		(1)
Income from operations	30		556
Interest expense	(3)		(3)
Investment income	5		1
Other non-operating items	(8)		(10)
Income before income taxes	23		544
Provision for income taxes	(1)		(124)
Equity in unconsolidated affiliate	—		1
Income from continuing operations	22		421
Income from discontinued operations, net of income taxes	—		62
Net income	$	22	$	483
Net (income) loss attributed to noncontrolling interest	(1)		1
Net income attributed to LP	$	21	$	484
Net income attributed to LP per share of common stock:
Income per share continuing operations - basic	$	0.29	$	4.92
Income per share discontinued operations - basic	—		0.72
Net income per share - basic	$	0.29	$	5.64
Income per share continuing operations - diluted	$	0.29	$	4.89
Income per share discontinued operations - diluted	—		0.71
Net income per share - diluted	$	0.29	$	5.60
Average shares of common stock used to compute net income per share:
Basic	72		86
Diluted	72		86

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

4

Condensed Consolidated Statements of Comprehensive Income

Dollar amounts in millions

(Unaudited) 

	Three Months Ended March 31,
	2023		2022
Net income	$	22	$	483
Other comprehensive income, net of tax
Foreign currency translation adjustments	15		23
Changes in defined benefit pension plans	4		1
Other comprehensive income, net of tax	19		24
Comprehensive income	42		508
Comprehensive (income) loss associated with noncontrolling interest	(1)		1
Comprehensive income attributed to LP	$	41	$	508

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

5

Condensed Consolidated Balance Sheets

Dollar amounts in millions

(Unaudited)

	March 31, 2023		December 31, 2022
ASSETS
Cash and cash equivalents	$	126	$	369
Receivables, net of allowance for doubtful accounts of $1 million as of March 31, 2023 and December 31, 2022	148		127
Inventories	415		337
Prepaid expenses and other current assets	23		20
Total current assets	713		854
Timber and timberlands	33		40
Property, plant, and equipment, net	1,397		1,326
Operating lease assets, net	42		44
Goodwill and other intangible assets	36		36
Investments in and advances to affiliates	5		6
Restricted cash	—		14
Other assets	24		24
Deferred tax asset	10		7
Total assets	$	2,259	$	2,350
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities	$	227	$	317
Income taxes payable	1		19
Total current liabilities	229		336
Long-term debt	347		346
Deferred income taxes	115		113
Non-current operating lease liabilities	35		41
Contingency reserves, excluding current portion	26		26
Other long-term liabilities	56		53
Total liabilities	$	808	$	916
Redeemable noncontrolling interest	1		—
Stockholders’ equity:
Common stock, $1 par value, 200,000,000 shares authorized; 87,986,865 and 72,031,465 shares issued and outstanding, respectively, as of March 31, 2023; and 87,986,865 and 71,748,200 shares issued and outstanding, respectively, as of December 31, 2022	88		88
Additional paid-in capital	455		462
Retained earnings	1,375		1,371
Treasury stock, 15,955,400 shares and 16,238,665 shares, at cost as of March 31, 2023, and December 31, 2022, respectively	(388)		(388)
Accumulated comprehensive loss	(80)		(99)
Total stockholders’ equity	1,450		1,433
Total liabilities and stockholders’ equity	$	2,259	$	2,350

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

6

Condensed Consolidated Statements of Cash Flows

Dollar amounts in millions

(Unaudited)

	Three Months Ended March 31,
	2023		2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	22	$	483
Adjustments to net income:
Depreciation and amortization	28		32
Gain on sale of assets	—		(39)
Pension loss due to settlement	6		—
Deferred taxes	(2)		11
Other adjustments, net	9		5
Changes in assets and liabilities (net of acquisitions and divestitures):
Receivables	(8)		(127)
Inventories	(76)		(55)
Prepaid expenses and other current assets	(2)		3
Accounts payable and accrued liabilities	(66)		(2)
Income taxes payable, net of receivables	(30)		116
Net cash (used) provided by operating activities	(119)		425
CASH FLOWS FROM INVESTING ACTIVITIES:
Property, plant, and equipment additions	(114)		(92)
Proceeds from sales of assets	1		59
Other investing activities	—		1
Net cash used in investing activities	(113)		(33)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of cash dividends	(17)		(19)
Purchase of stock	—		(104)
Other financing activities	(10)		(15)
Net cash used in financing activities	(27)		(137)
EFFECT OF EXCHANGE RATE ON CASH, CASH EQUIVALENTS, AND RESTRICTED CASH	3		11
Net (decrease) increase in cash, cash equivalents, and restricted cash	(257)		266
Cash, cash equivalents, and restricted cash at beginning of period	383		371
Cash, cash equivalents, and restricted cash at end of period	$	126	$	637
Supplemental cash flow information:
Cash paid for income taxes, net	$	33	$	12
Cash paid for interest, net	$	7	$	4
Unpaid capital expenditures	$	28	$	41

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

7

Condensed Consolidated Statements of Stockholders’ Equity

Dollar and share amounts in millions, except per share amounts

(Unaudited)

	Common Stock			Treasury Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Comprehensive Loss		Total Stockholders’ Equity
	Shares	Amount		Shares	Amount
Balance, December 31, 2022	88	$	88	16	$	(388)	$	462	$	1,371	$	(99)	$	1,433
Net income attributed to LP	—	—		—	—		—		21		—		21
Dividends paid ($0.24 per share)	—	—		—	—		—		(17)		—		(17)
Issuance of shares under stock plans	—	—		—	10		(10)		—		—		—
Taxes paid related to net settlement of stock-based awards	—	—		—	(10)		—		—		—		(10)
Compensation expense associated with stock-based compensation	—	—		—	—		4		—		—		4
Other comprehensive income	—	—		—	—		—		—		19		19
Balance, March 31, 2023	88	$	88	16	$	(388)	$	455	$	1,375	$	(80)	$	1,450

	Common Stock			Treasury Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Comprehensive Loss		Total Stockholders’ Equity
	Shares	Amount		Shares	Amount
Balance, December 31, 2021	102	$	102	17	$	(390)	$	458	$	1,239	$	(174)	$	1,235
Net income attributed to LP	—	—		—	—		—		484		—		484
Dividends paid ($0.22 per share)	—	—		—	—		—		(19)		—		(19)
Issuance of shares under stock plans	—	—		(1)	14		(14)		—		—		—
Taxes paid related to net settlement of stock-based awards	—	—		—	(15)		—		—		—		(15)
Purchase of stock	(2)	(2)		—	—		—		(102)		—		(104)
Compensation expense associated with stock-based compensation	—	—		—	—		7		—		—		7
Other comprehensive income	—	—		—	—		—		—		24		24
Balance, March 31, 2022	101	$	101	16	$	(391)	$	451	$	1,601	$	(149)	$	1,613

The accompanying notes are an integral part of these unaudited Condensed Consolidated Financial Statements.

8

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. NATURE OF OPERATIONS AND BASIS FOR PRESENTATION

Nature of Operations

Louisiana-Pacific Corporation and our subsidiaries are a leading provider of high-performance building solutions that meet the demands of builders, remodelers, and homeowners worldwide. Serving the new home construction, repair and remodeling, and outdoor structures markets, we have leveraged our expertise to become an industry leader known for innovation, quality, reliability, and sustainability. The principal customers for our building solutions are retailers, wholesalers, and homebuilding and industrial businesses in North America and South America, with limited sales to Asia, Australia, and Europe. The Company operates 22 plants across the U.S., Canada, Chile, and Brazil through foreign subsidiaries, and operates additional facilities through a joint venture. References to "LP," the "Company," "we," "our," and "us" refer to Louisiana-Pacific Corporation and its consolidated subsidiaries as a whole.

During the year ended December 31, 2022, we sold our 50% equity interest in two joint ventures that produce I-joists to Resolute Forest Products Inc., and we sold the remaining assets related to the EWP segment to Pacific Woodtech Corporation, a Washington corporation, and Pacific Woodtech Canada Holdings Limited, a British Columbia limited company (collectively, the Purchaser). Accordingly, the results of our previously-owned EWP segment have been presented as discontinued operations in our Condensed Consolidated Statements of Income for all periods presented. See "Note 7 –Discontinued Operations" for additional information.

Basis for Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) for interim financial information. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included and are of a normal and recurring nature. These Condensed Consolidated Financial Statements and related Notes should be read in conjunction with our annual report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 21, 2023 (2022 Annual Report on Form 10-K). Results of operations for interim periods are not necessarily indicative of results to be expected for an entire year.

NOTE 2. REVENUE

The following table presents our reportable segment revenues, disaggregated by revenue source. We disaggregate revenue from contracts with customers into major product lines. We have determined that disaggregating revenue into these categories depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

As noted in the segment reporting information in Note 16 below, our reportable segments are Siding, Oriented Strand Board (OSB), and South America (dollar amounts in millions).

9

Three Months Ended March 31, 2023
By Product type and family:	Siding		OSB		South America		Other		Inter-segment		Total
Value-add
Siding Solutions	$	329	$	—	$	8	$	—	$	—	$	337
OSB - Structural Solutions	—		112		46		—		—		158
	329		112		54		—		—		495
Commodity
OSB - commodity	—		75		—		—		—		75
Other
Other products	2		2		1		8		—		14
	$	331	$	189	$	55	$	8	$	—	$	584

Three Months Ended March 31, 2022
By Product type and family:	Siding		OSB		South America		Other		Inter-segment		Total
Value-add
Siding Solutions	$	330	$	—	$	6	$	—	$	—	$	336
OSB - Structural Solutions	—		406		58		—		(1)		464
	330		406		64		—		(1)		799
Commodity
OSB - commodity	—		334		—		—		—		334
Other
Other products	2		4		2		26		—		34
	$	332	$	744	$	67	$	26	$	(1)	$	1,167

Revenue is recognized when obligations under the terms of a contract (i.e., purchase orders) with our customers are satisfied; generally, this occurs with the transfer of control of our products at a point in time. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The shipping cost incurred by us to deliver products to our customers is recorded in cost of sales. The expected costs associated with our warranties continue to be recognized as an expense when the products are sold.

Our businesses routinely incur customer program costs to obtain favorable product placement, promote sales of products, and maintain competitive pricing. Customer program costs and incentives, including rebates and promotion and volume allowances, are accounted for as deductions from Net sales at the time the program is initiated. These reductions from revenue are recorded at the time of sale or the implementation of the program based on management’s best estimates. Estimates are based on historical and projected experience for each type of program or customer. Volume allowances are accrued based on management’s estimation of customer volume achievement and other factors incorporated into customer agreements, such as new product purchases, store sell-through, and merchandising support. Management adjusts accruals when circumstances indicate (typically as a result of a change in volume expectations).

We ship some of our products to customers’ distribution centers on a consignment basis. We retain title to our products stored at the distribution centers. As our products are removed from the distribution centers by retailers and shipped to retailers’ stores, title passes from us to the retailers. At that time, we invoice the retailers and recognize revenue for these consignment transactions. We do not offer a right of return for products shipped to the retailers’ stores from the distribution centers.

10

NOTE 3. EARNINGS PER SHARE

Basic earnings per share is based on the weighted-average number of shares of common stock outstanding. Diluted earnings per share is based upon the weighted-average number of shares of common stock outstanding, plus all potentially dilutive securities that were assumed to be converted into common shares at the beginning of the period under the treasury stock method. This method requires that the effect of potentially dilutive common stock equivalents (stock options, stock-settled appreciation rights (SSARs), restricted stock units, and performance stock units) be excluded from the calculation of diluted earnings per share for the periods in which losses from continuing operations are reported because the effect is anti-dilutive.

The following table sets forth the computation of basic and diluted earnings per share (dollar and share amounts in millions, except per share amounts):

	Three Months Ended March 31,
	2023		2022
Income from continuing operations	$	22	$	421
Net (income) loss attributed to noncontrolling interest	(1)		1
Income attributed to LP from continuing operations	21		422
Income for discontinued operations, net of income taxes	—		62
Net income attributed to LP	$	21	$	484
Weighted average common shares outstanding - basic	72		86
Dilutive effect of employee stock plans	—		1
Shares used for diluted earnings per share	72		86
Net income attributed to LP per share - basic:
Continuing operations	$	0.29	$	4.92
Discontinued operations	—		0.72
Net income attributed to LP per share - basic	$	0.29	$	5.64
Net income attributed to LP per share – diluted:
Continuing operations	$	0.29	$	4.89
Discontinued operations	—		0.71
Net income attributed to LP per share - diluted	$	0.29	$	5.60

NOTE 4. FAIR VALUE MEASUREMENTS

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. We are required to classify these financial assets and liabilities into two groups: (i) recurring—measured on a periodic basis, and (ii) non-recurring—measured on an as-needed basis.

The fair value of the 3.625% Senior Notes due in 2029 (2029 Senior Notes) was estimated to be $302 million and $306 million as of March 31, 2023 and December 31, 2022, respectively, based on market quotations. The 2029 Senior Notes and other long-term debt are categorized as Level 1 in the U.S. GAAP fair value hierarchy. Fair values are based on trading activity among the Company’s lenders and the average bid and ask price is determined using published rates.

In November 2022, LP entered into a Second Amended and Restated Credit Agreement with American AgCredit, PCA, as administrative agent and sole lead arranger, and CoBank, ACB, as letter of credit issuer (the Credit Agreement), relating to its revolving credit facility (as amended, the Amended Credit Facility). The Credit Agreement provides for a revolving credit facility in the principal amount of up to $550 million, with a $60 million sub-limit for letters of credit. The Credit Agreement, and all loans thereunder, become due on November 29, 2028.

11

As of March 31, 2023, there were no outstanding amounts borrowed under our Amended Credit Facility. As of May, 3, 2023, there was $45 million outstanding under the Amended Credit Facility.

Carrying amounts reported on the balance sheet for cash and cash equivalents, accounts receivables, and accounts payable approximate fair value due to the short-term maturity of these items.

NOTE 5. RECEIVABLES

Receivables consisted of the following (dollar amounts in millions):

	March 31, 2023		December 31, 2022
Trade receivables	$	112	$	106
Other receivables	23		19
Income tax receivable	15		4
Allowance for doubtful accounts	(1)		(1)
Total	$	148	$	127

Trade receivables are primarily generated by sales of our products to our wholesale and retail customers. Other receivables as of March 31, 2023 and December 31, 2022, primarily consist of sales tax receivables, vendor rebates, and other miscellaneous receivables.

NOTE 6. INVENTORIES

Inventories are valued at the lower of cost or net realizable value. Inventory cost includes materials, labor, and operating overhead. The major types of inventories (work in process is not material and is included in Semi-finished inventory) are as follows (dollar amounts in millions):

	March 31, 2023		December 31, 2022
Logs	$	102	$	59
Other raw materials	75		72
Semi-finished inventories	34		25
Finished products	204		180
Total	$	415	$	337

NOTE 7. DISCONTINUED OPERATIONS

Engineered Wood Products (EWP)

In March 2022, the Company sold its 50% equity interest in two joint ventures that produce I-joists to Resolute Forest Products Inc. for $59 million, resulting in a pre-tax gain associated with the sale of $39 million recorded in the year ended December 31, 2022 within Income from discontinued operations, net of income taxes in the Condensed Consolidated Statements of Income.

On August 1, 2022, the Company completed the sale of the assets related to the EWP segment to the Purchaser. As a result of the sale, the Company received $217 million in gross cash proceeds after taking into account working capital adjustments. The Company paid $12 million in direct transaction costs, resulting in net proceeds of $205 million. During the year ended December 31, 2022, the Company recorded a pre-tax gain of approximately $118 million within Income from discontinued operations, net of income taxes in the Condensed Consolidated Statements of Income.

Upon closing, the Company entered into the transition services agreement (TSA) with the Purchaser, pursuant to which the Company agreed to support the various activities of the EWP segment for a period not to exceed eight months, which concluded during the three months ended March 31, 2023. During the three months ended March 31, 2023, the Company collected $11 million on the Purchaser's behalf pursuant to the TSA. As of March 31, 2023, the

12

Company had no amounts due to or due from the Purchaser.

The Company has classified the results of its EWP segment as discontinued operations in its Condensed Consolidated Statements of Income for the prior period presented. The following table presents the financial results of the EWP segment for the three months ended March 31, 2022 (dollar amounts in millions):

	Three Months Ended March 31, 2022
Net sales	$	170
Cost of sales	(129)
Gross profit	41
Selling, general, and administrative expenses	(3)
Income from operations of discontinued operations	38
Other non-operating items	—
Gain on disposal before income taxes	39
Income from discontinued operations before income taxes	77
Provision for income taxes	(15)
Income from discontinued operations, net of income taxes	$	62

The following summarizes the total cash provided by operations and total cash provided by investing activities related to the EWP segment and included in the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 (dollar amounts in millions):

Net cash provided by discontinued operating activities	$	13
Net cash provided by discontinued investing activities	$	59

Net cash provided by discontinued investing activities for the three months ended March 31, 2022, includes $59 million of proceeds from the sale of our 50% equity interest in two joint ventures that produce I-joists.

NOTE 8. GOODWILL AND OTHER INTANGIBLES

Goodwill and indefinite-lived intangible assets are not amortized and are subject to assessment for impairment by applying a fair value-based test on an annual basis, or more frequently if circumstances indicate a potential impairment. The Company’s annual assessment date is October 1.

Changes in goodwill and other intangible assets for the three months ended March 31, 2023, are provided in the following table (dollar amounts in millions):

	Timber Licenses1		Goodwill		Developed Technology		Trademarks
Beginning balance December 31, 2022	$	28	$	19	$	15	$	2
Amortization	(1)		—		—		—
Ending balance March 31, 2023	$	27	$	19	$	15	$	2

1Timber licenses are included in Timber and timberlands on the Condensed Consolidated Balance Sheets.

NOTE 9. INCOME TAXES

For interim periods, we recognize income tax expense by applying the estimated annual effective income tax rate to year-to-date results unless this method does not result in a reliable estimate of year-to-date income tax expense. Each period, the income tax accrual is adjusted to the latest estimate, and the difference from the previously accrued year-to-date balance is adjusted in the current quarter. Changes in profitability estimates in various jurisdictions will impact our quarterly effective income tax rates.

The tax provision for income taxes from continuing operations for the three months ended March 31, 2023 and 2022, reflected an estimated annual effective tax rate of 28% and 24%, respectively, excluding discrete items

13

discussed below. The total effective tax rate for continuing operations for the three months ended March 31, 2023 was 5%, compared to 23% for the comparable period in 2022.

We recognized net discrete tax benefits of $5 million and $9 million in the three months ended March 31, 2023 and 2022, respectively. The discrete benefits primarily relate to excess tax benefits from stock-based compensation and inflationary adjustments.

On August 16, 2022, the Inflation Reduction Act of 2022 ("IRA") was signed into law. The IRA levies a 1% excise tax on net stock repurchases after December 31, 2022 and imposes a 15% corporate alternative minimum tax ("CAMT") for tax years beginning after December 31, 2022. The Company did not repurchase any shares during the three months ended March 31, 2023. CAMT is not expected to have a material impact on our results of operations or financial position.

NOTE 10. COMMITMENTS AND CONTINGENCIES

We maintain reserves for various contingent liabilities as follows (dollar amounts in millions):

	March 31, 2023		December 31, 2022
Environmental reserves	$	27	$	27
Other reserves	—		—
Total contingencies	27		27
Current portion (included in Accounts payable and accrued liabilities)	(1)		(1)
Long-term portion	$	26	$	26

Estimates of our loss contingencies are based on various assumptions and judgments. Due to the numerous uncertainties and variables associated with these assumptions and judgments, both the precision and reliability of the resulting estimates of the related contingencies are subject to substantial uncertainties. We regularly monitor our estimated exposure to contingencies and, as additional information becomes known, may change our estimates significantly. While no estimate of the range of any such change can be made at this time, the amount that we may ultimately pay in connection with these matters could materially exceed, in either the near term or the longer term, the amounts accrued to date. Our estimates of our loss contingencies do not reflect potential future recoveries from insurance carriers except to the extent that recovery may, from time to time, be deemed probable as a result of an insurer’s agreement to payment terms.

Environmental Matters

We maintain a reserve for undiscounted estimated environmental loss contingencies. This reserve is primarily for estimated future costs of remediation of hazardous or toxic substances at numerous sites currently or previously owned by the Company. Our estimates of our environmental loss contingencies are based on various assumptions and judgments, the specific nature of which varies considering the particular facts and circumstances surrounding each environmental loss contingency. These estimates typically reflect assumptions and judgments as to the probable nature, magnitude, and timing of the required investigation, remediation, and/or monitoring activities and the probable cost of these activities, and in some cases, reflect assumptions and judgments as to the obligation or willingness and ability of third parties to bear a proportionate or allocated share of the cost of these activities. Due to the numerous uncertainties and variables associated with these assumptions and judgments, and the effects of changes in governmental regulation and environmental technologies, both the precision and reliability of the resulting estimates of the related contingencies are subject to substantial uncertainties. We regularly monitor our estimated exposure to environmental loss contingencies and, as additional information becomes known, may change our estimates significantly.

Other Proceedings

From time to time, we and our subsidiaries are parties to certain legal proceedings. Based on the information currently available, management believes the resolution of such proceedings will not have a material effect on our financial position, results of operations, cash flows, or liquidity.

14

NOTE 11. IMPAIRMENT OF LONG-LIVED ASSETS

We review the carrying values of our long-lived assets for potential impairments and believe we have adequate support for the carrying values of our long-lived assets. If demand and pricing for our products fall to levels significantly below cycle average demand and pricing, should we decide to invest capital in alternative projects, or should changes occur related to our wood supply for our mills, it is possible that future impairment charges will be required. As of March 31, 2023, there were no indications of impairment.

We also review from time to time potential dispositions of various assets, considering current and anticipated economic and industry conditions, our strategic plan, and other relevant factors. Because a determination to dispose of particular assets can require management to make assumptions regarding the transaction structure of the disposition and to estimate the Net sales proceeds, which may be less than previous estimates of undiscounted future net cash flows, we may be required to record impairment charges in connection with decisions to dispose of assets.

NOTE 12. PRODUCT WARRANTIES

We offer warranties on the sale of most of our products and record an accrual for estimated future claims. Such accruals are based upon historical experience and management’s estimate of the level of future claims. The activity in warranty reserves for the three months ended March 31, 2023 and 2022, is summarized in the following table (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Beginning balance	$	8	$	7
Accrued to expense	1		1
Payments made	—		—
Total warranty reserves	8		8
Current portion of warranty reserves (included in Accounts payable and accrued liabilities)	(2)		(2)
Long-term portion of warranty reserves (included in Other long-term liabilities)	$	7	$	6

We continue to monitor warranty and other claims associated with our products and believe, as of March 31, 2023, that the warranty reserve balances associated with these matters are adequate to cover future warranty payments. However, it is possible that additional changes may be required in the future.

NOTE 13. DEFINED BENEFIT PENSION PLANS

The following table summarizes our net periodic pension cost for our defined benefit pension and postretirement plans during the three months ended March 31, 2023 and 2022 (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Service cost	$	—	$	1
Other components of net periodic pension cost1:
Interest cost	—		2
Expected return on plan assets	—		(2)
Amortization of prior service cost	—		—
Amortization of net loss	—		1
Net periodic pension costs before loss due to settlement	—		2
Loss due to settlement	6		—
Total net periodic pension cost	$	6	$	2

1Other components of net periodic pension cost are included in Other non-operating items on our Condensed Consolidated Statements of Income.

15

In November 2021, the Company initiated the termination of our frozen U.S. and Canadian defined benefit pension plans (collectively, the Plan), which would result in the full settlement of the Company's Plan obligations. During the year ended December 31, 2022, the Company liquidated substantially all of the Plan assets to fund lump-sum distributions to participants and purchase non-participating group annuity contracts. As a result, a substantial portion of the Plan was settled during the year ended December 31, 2022. During the three months ended March 31, 2023, the Company completed the termination of the Plan resulting in recognition of non-cash, pre-tax charges of $6 million from Accumulated comprehensive loss to Other non-operating items in our Condensed Consolidated Statements of Income. Liquidation of remaining Plan assets in surplus of the defined benefit pension obligation will be made once the Plan satisfies all regulatory requirements, which is expected to be completed during 2023.

The changes recognized in Other comprehensive loss were as follows (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Net actuarial gain (loss) and prior service (cost) arising during the period, net of tax	$	—	$	—
Amortization of actuarial loss, prior service cost and settlements, net of tax	4		1
Total amounts recognized in Other comprehensive income	$	4	$	1

NOTE 14. ACCUMULATED COMPREHENSIVE LOSS

Accumulated comprehensive loss is provided in the following table for the three months ended March 31, 2023 and 2022 (dollar amounts in millions):

	Pension		Translation Adjustments		Other		Total
Balance at December 31, 2022	$	(5)	$	(94)	$	—	$	(99)
Reclassified to income statement, net of taxes1	4		—		—		4
Translation adjustments	—		15		—		15
Balance at March 31, 2023	$	—	$	(79)	$	—	$	(80)

	Pension		Translation Adjustments		Other		Total
Balance at December 31, 2021	$	(76)	$	(96)	$	(1)	$	(174)
Reclassified to income statement, net of taxes1	1		—		—		1
Translation adjustments	—		23		—		23
Balance at March 31, 2022	$	(75)	$	(73)	$	(1)	$	(149)

1 Amounts of actuarial loss and prior service cost are components of net periodic benefit cost. See Note 14 above for additional details.

NOTE 15. OTHER OPERATING AND NON-OPERATING ITEMS

Other operating credits and charges, net

Other operating credits and charges, net, is comprised of the following components (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Insurance recoveries	$	—	$	—
Reorganization charges	(2)		(1)
Environmental costs	—		—
Other	(3)		—
Other operating credits and charges, net	$	(5)	$	(1)

16

Other non-operating items

Other non-operating items is comprised of the following components (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Net periodic pension cost, excluding service cost	$	—	$	(1)
Pension settlement charges	(6)		—
Foreign currency loss	(3)		(9)
Other	1		—
Other non-operating items	$	(8)	$	(10)

NOTE 16. SELECTED SEGMENT DATA

We operate in three segments: Siding, OSB, and South America. Our business units have been aggregated into these three segments based upon the similarity of economic characteristics, customers, and distribution methods. Our results of operations are summarized below for each of these segments separately, as well as for the “Other” category, which comprises other products that are not individually significant.

We evaluate the performance of our business segments based on Net sales and segment Adjusted EBITDA. Accordingly, our chief operating decision maker evaluates performance and allocates resources based primarily on Net sales and segment Adjusted EBITDA for our business segments. Segment Adjusted EBITDA is defined as Income attributed to LP before interest expense, provision for income taxes, depreciation and amortization, and excludes stock-based compensation expense, loss on impairment attributed to LP, product-line discontinuance charges, other operating credits and charges, net, loss on early debt extinguishment, investment income, pension settlement charges, and other non-operating items.

17

Information about our business segments is as follows (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Net sales
Siding	$	331	$	332
OSB	189		744
South America	55		67
Other	8		26
Intersegment sales	—		(1)
Total sales	$	584	$	1,167
NET INCOME TO ADJUSTED EBITDA RECONCILIATION
Net income	$	22	$	483
Add (deduct):
Net loss (income) attributed to noncontrolling interest	(1)		1
Income from discontinued operations, net of income taxes	—		(62)
Income attributed to LP from continuing operations	21		422
Provision for income taxes	1		124
Depreciation and amortization	28		32
Stock-based compensation expense	4		6
Other operating credits and charges, net	5		1
Interest expense	3		3
Investment income	(5)		(1)
Pension settlement charges	6		—
Other non-operating items	3		10
Adjusted EBITDA	$	66	$	598
SEGMENT ADJUSTED EBITDA
Siding	$	67	$	83
OSB	5		505
South America	12		25
Other	(9)		(6)
Corporate	(9)		(9)
Total Adjusted EBITDA	$	66	$	598

NOTE 17. SUBSEQUENT EVENTS

In April 2023, the Company announced the shutdown of Entekra Holdings, LLC (Entekra), an off-site framing operation previously reported within our "other" operating segment, which is expected to result in a pre-tax, non-cash charges of between $25 million and $30 million in the second quarter of 2023.

In May 2023, the Company acquired substantially all of the assets of Wawa OSB Inc., an Ontario, Canada corporation, for $80 million. The acquisition was funded together with cash on hand and borrowings under the Amended Credit Facility.

18

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our Condensed Consolidated Financial Statements and related Notes and other financial information appearing elsewhere in this quarterly report on Form 10-Q. The following discussion includes statements that are forward-looking statements that are based on the beliefs of our management, as well as assumptions made by and information currently available to our management. See "Cautionary Statement Regarding Forward-Looking Statements."

General

We are a leading provider of high-performance building solutions that meet the demands of builders, remodelers, and homeowners worldwide. We have leveraged our expertise serving the new home construction, repair and remodeling, and outdoor structures markets to become an industry leader known for innovation, quality, reliability, and sustainability. Our manufacturing facilities are located in the U.S., Canada, Chile, and Brazil.

To serve these markets, we primarily operate in three segments: Siding, OSB, and South America.

In March 2022, we sold our 50% equity interest in two joint ventures that produce I-joists to Resolute for $59 million. The joint ventures were comprised of Resolute-LP Engineered Wood Larouche Inc. in Larouche, Quebec, and Resolute-LP Engineered Wood St-Prime Limited Partnership in Saint-Prime, Quebec. In August 2022, LP completed the sale of the EWP segment assets to the Purchaser in exchange for the Purchaser’s payment to the Company of $217 million in gross cash proceeds. The historical results of the EWP segment are reflected in the Company’s Condensed Consolidated Financial Statements as discontinued operations. See "Note 7 – Discontinued Operations" of the Notes to the Condensed Consolidated Financial Statements included in Item 1 of this quarterly report on Form 10-Q for additional information.

Demand for Building Products

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 April 18, 2023, that actual single-family housing starts were 29% lower for the three months ended March 31, 2023, as compared to the same period in 2022. Actual multi-family housing starts for the three months ended March 31, 2023 were about 5% higher as compared to the same period in 2022. Repair and remodeling activity is difficult to reasonably measure, but many indications suggest that repair and remodeling activity is continuing to show resiliency.

Future economic conditions in the United States and the demand for homes are uncertain due to inflationary impacts on the economy, including interest rates, employment levels, consumer confidence, and financial markets, among other things. Additionally, we have experienced increases in material prices, supply disruptions, and labor challenges, which we continue to address as we work to meet the demands of builders, remodelers, and homeowners worldwide. The potential effect 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.

Supply and Demand for Siding

Siding Solutions is a specialty building material and is subject to competition from various siding technologies, including vinyl, stucco, wood, fiber cement, brick, and others. We believe we are the largest manufacturer in the engineered wood siding market. We have consistently grown our Siding Solutions above the underlying market growth rates. Siding Solutions is generally less sensitive to new housing market cyclicality since demand comes from other markets, including sheds 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.

19

Supply and Demand for OSB

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. During the three months ended March 31, 2023, OSB commodity prices have fallen with the decline in market demand for OSB commodity product. We cannot predict whether the prices of our OSB products will remain at current levels or increase or decrease in the future.

For additional factors affecting our results, refer to the “Overview” within our “Management's Discussion and Analysis of Financial Condition and Results of Operations” section and our “Risk Factors” section contained in our 2022 Annual Report on Form 10-K, and to the “Cautionary Statement Regarding Forward-Looking Statements” section in this quarterly report on Form 10-Q.

Critical Accounting Policies and Significant Estimates

Note 1 of the Notes to the Condensed Consolidated Financial Statements included in our 2022 Annual Report on Form 10-K is a discussion of our significant accounting policies and significant accounting estimates and judgments. Throughout the preparation of the financial statements, we employ significant judgments in the application of accounting principles and methods. These judgments are primarily related to the assumptions used to arrive at various estimates.

There have been no changes in the application of principles, methods, and assumptions used to determine our significant estimates since December 31, 2022.

Non-GAAP Financial Measures and Other Key Performance Indicators

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 Income attributed to LP from continuing operations before interest expense, provision for income taxes, depreciation and amortization, and excluding stock-based compensation expense, loss on impairment attributed to LP, product-line discontinuance charges, other operating credits and charges, net, loss on early debt extinguishment, investment income, pension settlement charges, and other non-operating items as Adjusted EBITDA from continuing operations (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 Income attributed to LP from continuing operations, excluding loss on impairment attributed to LP, 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, and pension settlement charges, and adjusting for a normalized tax rate, as Adjusted Income from continuing operations (Adjusted Income). We also disclose Adjusted Diluted EPS from continuing operations (Adjusted Diluted EPS), calculated as Adjusted Income divided by diluted shares outstanding. 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.

Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS are not substitutes for the U.S. GAAP measures of Net income, Income attributed to LP from continuing operations, and Net income attributed to LP from continuing operations per diluted share or for any other U.S. GAAP measures of operating performance. It should be noted that other companies may present similarly titled measures differently, and therefore, as presented by us, these measures may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS have material limitations as performance measures because they exclude items that are actually incurred or experienced in connection with the operation of our business.

20

The following table reconciles Net income to Adjusted EBITDA (dollar amounts in millions):

	Three Months Ended March 31,
	2023		2022
Net income	$	22	$	483
Add (deduct):
Net (income) loss attributed to noncontrolling interest	(1)		1
Income from discontinued operations, net of income taxes	—		(62)
Income attributed to LP from continuing operations	21		422
Provision for income taxes	1		124
Depreciation and amortization	28		32
Stock-based compensation expense	4		6
Other operating credits and charges, net	5		1
Interest expense	3		3
Investment income	(5)		(1)
Pension settlement charges	6		—
Other non-operating items	3		10
Adjusted EBITDA	$	66	$	598
SEGMENT ADJUSTED EBITDA
Siding	$	67	$	83
OSB	5		505
South America	12		25
Other	(9)		(6)
Corporate	(9)		(9)
Total Adjusted EBITDA	$	66	$	598

21

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

	Three Months Ended March 31,
	2023		2022
Net income attributed to LP from continuing operations per share - diluted	$	0.29	$	4.89
Net income	$	22	$	483