Selected Segment Data

9 Months Ended

Sep. 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. The Company's chief operating decision maker is the Chief Executive Officer. Segment Adjusted EBITDA is defined as Income 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 nine months ended September 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 September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net sales
Siding	$	345	$	394	$	996	$	1,083
OSB	335		388		754		1,805
South America	45		53		153		190
Other	4		17		21		72
Intersegment sales	—		(1)		—		(2)
Total sales	$	728	$	852	$	1,923	3,149
NET INCOME TO ADJUSTED EBITDA
Net income	$	118	$	226	$	119	$	1,093
Add (deduct):
Net loss attributed to non-controlling interest	—		—		—		1
Income from discontinued operations, net of income taxes	—		(97)		—		(196)
Income attributed to LP from continuing operations	118		129		119		898
Provision for income taxes	44		44		66		284
Depreciation and amortization	30		32		87		96
Stock-based compensation expense	2		2		9		15
Loss on impairment attributed to LP	1		—		1		—
Other operating credits and charges, net	(7)		(7)		16		(17)
Business exit charges	1		—		35		—
Interest expense	4		3		9		9
Investment income	(4)		(5)		(10)		(8)
Other non-operating items	—		(1)		11		7
Pension settlement charges	—		4		6		4
Adjusted EBITDA	$	190	$	200	$	349	$	1,289
SEGMENT ADJUSTED EBITDA
Siding	$	71	$	90	$	198	$	251
OSB	120		113		161		1,021
South America	6		14		31		65
Other	—		(7)		(15)		(19)
Corporate	(7)		(11)		(26)		(29)
Total Adjusted EBITDA	$	190	$	200	$	349	$	1,289