Selected Segment Data

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Selected Segment Data

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 (defined below). 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 (loss) attributed to LP from continuing operations before interest expense, provision for income taxes, depreciation and amortization, and excludes stock-based compensation expense, loss on impairment attributed to LP, business exit charges, 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.

During the three months ended June 30, 2023, we updated our definition of Adjusted EBITDA to exclude other business exit charges not classified as exit operations. Business exit charges consist of inventory and other asset impairment and exit charges related to the exit of businesses not individually significant. We consider business exit charges to be outside the performance of our ongoing core business operations and believe that presenting Adjusted EBITDA excluding business exit charges provides increased transparency as to the operating costs of our current business performance. We did not revise prior years’ Adjusted EBITDA amounts because there were no significant costs similar in nature to these items.

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

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Net sales
Siding	$	320	$	358	$	651	$	689
OSB	229		673		418		1,417
South America	53		70		108		137
Other	9		30		17		55
Intersegment sales	—		(1)		—		(2)
Total sales	$	611	$	1,130	$	1,195	2,297
NET INCOME TO ADJUSTED EBITDA
Net income (loss)	$	(21)	$	385	$	1	$	868
Add (deduct):
Net loss attributed to non-controlling interest	1		—		—		1
Income from discontinued operations, net of income taxes	—		(37)		—		(99)
Income (loss) attributed to LP from continuing operations	(20)		348		1		770
Provision for income taxes	21		116		22		240
Depreciation and amortization	29		32		57		64
Stock-based compensation expense	3		6		7		13
Other operating credits and charges, net	17		(11)		22		(10)
Business exit charges	34		—		34		—
Interest expense	3		3		6		6
Investment income	(2)		(2)		(7)		(3)
Other non-operating items	8		(2)		11		8
Pension settlement charges	—		—		6		—
Adjusted EBITDA	$	93	$	491	$	159	$	1,089
SEGMENT ADJUSTED EBITDA
Siding	$	59	$	78	$	126	$	160
OSB	37		403		42		908
South America	13		26		24		51
Other	(6)		(7)		(14)		(13)
Corporate	(9)		(9)		(19)		(17)
Total Adjusted EBITDA	$	93	$	491	$	159	$	1,089