Selected Segment Data

9 Months Ended

Sep. 30, 2020

SELECTED SEGMENT DATA

We operate in four segments: Siding, OSB, EWP, and South America. Our business units have been aggregated into these four 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 LP CanExel® prefinished siding was reclassified from Siding to Other during the nine months ended September 30, 2020, reflecting changes in organizational structure and, accordingly, the information that the chief operating decision maker uses to evaluate performances and allocate resources to the segments. All prior periods presented have been adjusted for comparability.

We evaluate the performance of our business segments based on net sales and Adjusted EBITDA. Accordingly, our chief operating decision maker evaluates performance and allocates resources based primarily on net sales and Adjusted EBITDA for our business segments. Adjusted EBITDA is a non-GAAP financial measure and 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, and other non-operating items.

Information about our product segments is as follows:



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2020			2019			2020			2019
Net sales
Siding	$	268		$	244		$	700		$	695
OSB	368			197			792			605
EWP	103			105			281			303
South America	45			36			119			121
Other	11			21			36			53
Intersegment sales	—			(1		)	—			(4		)
Total sales	$	795		$	603		$	1,928		$	1,773
PROFIT BY SEGMENT
Net income	$	177		$	1		$	241		$	42
Add (deduct):
Net loss attributed to noncontrolling interest	—			1			2			3
Income attributed to LP	177			2			243			46
Provision for income taxes	60			3			88			13
Depreciation and amortization	28			29			84			89
Stock-based compensation expense	5			2			8			6
Loss on impairment attributed to LP	1			5			15			6
Other operating credits and charges, net	(2		)	3			(4		)	2
Product-line discontinuance charges	(1		)	—			9			—
Interest expense	5			6			17			14
Investment income	—			(2		)	(3		)	(9		)
Other non-operating items	—			1			(4		)	(8		)
Adjusted EBITDA	$	273		$	49		$	453		$	160

Siding	$	76		$	44		$	169		$	128
OSB	189			(1		)	270			4
EWP	9			6			21			22
South America	11			7			29			27
Other	(5		)	(1		)	(13		)	(1		)
Corporate	(7		)	(6		)	(23		)	(20		)
Adjusted EBITDA	$	273		$	49		$	453		$	160