Selected Segment Data

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Selected Segment Data

SELECTED SEGMENT DATA

We operate in three segments: Siding, OSB, and LPSA. 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.

•Our Siding segment serves diverse end markets with a broad product offering, including LP® SmartSide® Trim & Siding, LP® SmartSide® ExpertFinish® Trim & Siding, LP BuilderSeries® Lap Siding, and LP® Outdoor Building Solutions™ (collectively referred to as Siding Solutions). Our Siding Solutions products consist of a full line of engineered wood siding, trim, soffit, and fascia.

•Our OSB segment manufactures and distributes OSB structural panel products, including the innovative value-added OSB product portfolio known as LP® Structural Solutions (which includes LP TechShield® Radiant Barrier, LP WeatherLogic® Air & Water Barrier, LP Legacy® Premium Sub-Flooring, LP NovaCore® Thermal Insulated Sheathing, LP FlameBlock® Fire-Rated Sheathing, and LP TopNotch® 350 Durable Sub-Flooring). OSB is manufactured using wood strands arranged in layers and bonded with resins.

•Our LPSA segment manufactures and distributes LP OSB structural panel and Siding Solutions products in South America and certain export markets. This segment also sells and distributes a variety of companion products to support the region’s transition to wood frame construction. The LPSA segment carries out manufacturing operations in Chile and Brazil and operates sales offices in Argentina, Brazil, Chile, Colombia, Mexico, Paraguay, and Peru.

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, 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.

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

	Three Months Ended March 31,
	2024		2023
NET SALES BY BUSINESS SEGMENT
Siding	$	361	$	331
OSB	313		189
LPSA	47		55
Other	3		8
Total sales	$	724	$	584
NET INCOME TO ADJUSTED EBITDA RECONCILIATION
Net income	$	108	$	22
Add (deduct):
Net income attributed to non-controlling interest	—		(1)
Income attributed to LP	108		21
Provision for income taxes	41		1
Depreciation and amortization	31		28
Stock-based compensation expense	6		4
Other operating credits and charges, net	—		5
Business exit charges	(1)		—
Interest expense	4		3
Investment income	(6)		(5)
Pension settlement charges	—		6
Other non-operating items	(1)		3
Adjusted EBITDA	$	182	$	66
SEGMENT ADJUSTED EBITDA
Siding	$	90	$	67
OSB	90		5
LPSA	10		12
Other	(1)		(9)
Corporate	(7)		(9)
Adjusted EBITDA	$	182	$	66