LOUISIANA-PACIFIC CORP [LPX] Filings

10-Q 1 lpx-20240630.htm 10-Q lpx-20240630

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 June 30, 2024

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	☐
Emerging growth company	☐

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 ☐ No ý

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 70,275,943 shares of common stock, $1 par value, outstanding as of August 6, 2024.

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 consolidated 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 such forward-looking 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,” “target,” “potential,” “continue,” “likely,” or “future,” as well as similar expressions, or the negative or other variations thereof and (2) other statements regarding matters that are not historical facts, including without limitation, statements concerning plans for product development, forecasts of future costs and expenditures, possible outcomes of legal proceedings, capacity expansion and other growth initiatives, the adequacy of reserves for loss contingencies, and any statements regarding the Company's financial outlook.

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 new or ongoing military conflicts including the conflict between Russia and Ukraine and the conflict in Israel and the surrounding areas;

•the commodity nature of a segment of our products and the prices for those products, which are determined in significant part by external factors such as total industry capacity and wider industry cycles affecting supply and demand trends;

•changes in the cost and availability of capital;

•changes in the cost and availability of financing for home mortgages;

•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 of building products;

•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, including transportation services provided by third parties;

•our dependence on third-party vendors and suppliers for certain goods and services critical to our business;

•operational and financial impacts from manufacturing our products internationally;

•difficulties in the development, launch or production ramp-up of new products;

•our ability to attract and retain qualified executives, management and other key employees;

•the need to formulate and implement effective succession plans from time to time for key members of our management team;

•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;

•our ability to identify and successfully complete and integrate acquisitions, divestitures, joint ventures, capital investments and other corporate strategic transactions;

•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 global or regional climate conditions, the impacts of climate change, and potential government policies adopted in response to such conditions;

•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, Chilean peso, and Argentine 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;

•challenges to or exploitation of our intellectual property or other proprietary information by our competitors or other third parties;

•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, or furnished by us to, 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 are 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 and are inherently uncertain. 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.

PART I - FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

Condensed Consolidated Statements of Income

Amounts in millions, except per share amounts

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net sales	$	814	$	611	$	1,539	$	1,195
Cost of sales	(551)		(492)		(1,062)		(975)
Gross profit	263		119		477		220
Selling, general, and administrative expenses	(71)		(66)		(140)		(133)
Impairment of long-lived assets, net	—		(24)		—		(24)

Other operating credits and charges, net	2		(21)		3		(26)
Income from operations	194		8		339		37
Interest expense	(4)		(3)		(8)		(6)
Investment income	6		2		11		7
Other non-operating income (expense)	5		(8)		6		(16)
Income (loss) before income taxes	201		(1)		349		22
Provision for income taxes	(53)		(21)		(94)		(22)
Equity in unconsolidated affiliate	12		1		12		1


Net income (loss)	$	160	$	(21)	$	267	$	1
Net loss attributed to non-controlling interest	—		1		—		—
Net income (loss) attributed to LP	$	160	$	(20)	$	267	$	1

Net income (loss) attributed to LP per share of common stock:


Basic	$	2.23	$	(0.28)	$	3.72	$	0.02



Diluted	$	2.23	$	(0.28)	$	3.71	$	0.02

Average shares of common stock used to compute net income (loss) per share:
Basic	72		72		72		72
Diluted	72		72		72		72

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

Condensed Consolidated Statements of Comprehensive Income

Amounts in millions

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income (loss)	$	160	$	(21)	$	267	$	1
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments	(4)		1		(20)		16


Other	—		—		—		4
Other comprehensive income (loss), net of tax	(4)		1		(19)		21
Comprehensive income (loss)	156		(20)		248		22
Comprehensive loss associated with non-controlling interest	—		1		—		—
Comprehensive income (loss) attributed to LP	$	156	$	(19)	$	248	$	22

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

Condensed Consolidated Balance Sheets

Amounts in millions, except per share amounts

(Unaudited)


	June 30, 2024		December 31, 2023
ASSETS
Cash and cash equivalents	$	317	$	222
Receivables, net of allowance for doubtful accounts of $2 as of June 30, 2024 and December 31, 2023	161		155
Inventories	373		378
Prepaid expenses and other current assets	32		23

Total current assets	883		778

Property, plant, and equipment, net	1,542		1,540
Timber and timberlands	30		32
Operating lease assets, net	22		25
Goodwill and other intangible assets	26		27
Investments in and advances to affiliates	1		5

Other assets	20		20
Deferred tax asset	5		11

Total assets	$	2,529	$	2,437

LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued liabilities	$	258	$	254
Income taxes payable	3		5

Total current liabilities	261		259

Long-term debt	347		347
Deferred income taxes	158		162
Non-current operating lease liabilities	23		25
Contingency reserves, excluding current portion	25		25
Other long-term liabilities	57		61

Total liabilities	$	871	$	880



Stockholders’ equity:
Common stock, $1 par value, 200 shares authorized; 87 and 71 shares issued and outstanding, respectively, as of June 30, 2024; and 88 and 72 shares issued and outstanding, respectively, as of December 31, 2023	87		88
Additional paid-in capital	471		465
Retained earnings	1,595		1,479
Treasury stock, 16 shares at cost as of June 30, 2024 and December 31, 2023	(385)		(386)
Accumulated comprehensive loss	(109)		(89)
Total stockholders’ equity	1,658		1,557
Total liabilities and stockholders’ equity	$	2,529	$	2,437

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

Condensed Consolidated Statements of Cash Flows

Amounts in millions

(Unaudited)


	Six Months Ended June 30,
		2024		2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	267	$	1
Adjustments to net income:
Depreciation and amortization		62		57
Impairment of goodwill and long-lived assets		—		24

Pension loss due to settlement		—		6

Deferred taxes		4		10
Foreign currency remeasurement and transaction (gain) loss		(5)		13
Other adjustments, net		(6)		29
Changes in assets and liabilities (net of acquisitions and divestitures):
Receivables		(33)		(22)
Inventories		1		(68)
Prepaid expenses and other current assets		(11)		(1)
Accounts payable and accrued liabilities		16		(45)
Income taxes payable, net of receivables		21		(33)
Net cash provided by (used in) operating activities		317		(30)
CASH FLOWS FROM INVESTING ACTIVITIES:
Property, plant, and equipment additions		(77)		(188)
Acquisition of facility assets		—		(80)
Proceeds from sales of assets		—		1

Other investing activities, net		16		(4)
Net cash used in investing activities		(61)		(271)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowing of long-term debt		—		70
Repayment of long-term debt, including call premium		—		(40)
Payment of cash dividends		(37)		(35)
Repurchase of common stock		(115)		—
Other financing activities		(5)		(9)
Net cash used in financing activities		(157)		(14)
EFFECT OF EXCHANGE RATE ON CASH, CASH EQUIVALENTS, AND RESTRICTED CASH		(3)		3
Net increase (decrease) in cash, cash equivalents, and restricted cash		95		(313)
Cash, cash equivalents, and restricted cash at beginning of period		222		383
Cash, cash equivalents, and restricted cash at end of period		$	317	$	71

Supplemental cash flow information:
Cash paid for income taxes, net		$	69	$	45
Cash paid for interest, net		$	7	$	1
Unpaid capital expenditures		$	10	$	22

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

Condensed Consolidated Statements of Stockholders’ Equity

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, 2023	88	$	88	16	$	(386)	$	465	$	1,479	$	(89)	$	1,557
Net income attributed to LP	—	—		—	—		—		108		—		108
Dividends paid ($0.26 per share)	—	—		—	—		—		(19)		—		(19)
Issuance of shares under stock plans	—	—		—	6		(6)		—		—		—
Taxes paid related to net settlement of stock-based awards	—	—		—	(6)		—		—		—		(6)
Purchase of stock	—	—		—	—		—		(13)		—		(13)
Compensation expense associated with stock-based compensation	—	—		—	—		6		—		—		6
Other comprehensive loss	—	—		—	—		—		—		(15)		(15)
Balance, March 31, 2024	88	$	88	16	$	(386)	$	465	$	1,555	$	(104)	$	1,617
Net income attributed to LP	—	—		—	—		—		160		—		160
Dividends paid ($0.26 per share)	—	—		—	—		—		(19)		—		(19)
Issuance of shares under stock plans	—	—		—	1		1		—		—		3
Taxes paid related to net settlement of stock-based awards	—	—		—	—		—		—		—		—
Purchase of stock	(1)	(1)		—	—		—		(101)		—		(103)
Compensation expense associated with stock-based compensation	—	—		—	—		4		—		—		4
Other comprehensive loss	—	—		—	—		—		—		(4)		(4)
Balance, June 30, 2024	87	$	87	16	$	(385)	$	471	$	1,595	$	(109)	$	1,658


	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
Net loss attributed to LP	—	—		—	—		—		(20)		—		(20)
Dividends paid ($0.24 per share)	—	—		—	—		—		(17)		—		(17)
Issuance of shares under stock plans	—	—		—	2		—		—		—		2
Taxes paid related to net settlement of stock-based awards	—	—		—	(1)		—		—		—		(1)

Compensation expense associated with stock-based compensation	—	—		—	—		3		—		—		3
Other comprehensive income	—	—		—	—		—		—		1		1
Balance, June 30, 2023	88	$	88	16	$	(387)	$	458	$	1,337	$	(78)	$	1,419

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

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 home building and industrial businesses in North America and South America, and we make limited sales to customers in Asia, Australia, and Europe. The Company operates 22 plants across the U.S., Canada, Chile, and Brazil, in certain cases through foreign subsidiaries. References to "LP," the "Company," "we," "our," and "us" refer to Louisiana-Pacific Corporation and its consolidated subsidiaries as a whole.

See "Note 15 - Selected Segment Data" below for further information regarding our products and segments.

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (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, 2023, filed with the SEC on February 14, 2024 (2023 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.

The Condensed Consolidated Financial Statements include the accounts of LP and our controlled subsidiaries. All intercompany transactions, profits, and balances have been eliminated. All dollar amounts included in tables in the Notes are in millions except per share amounts.

NOTE 2. REVENUE

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 15 - Selected Segment Data” below, our reportable segments are Siding, Oriented Strand Board (OSB), and LP South America (LPSA). The following tables present our reportable segment revenues, disaggregated by revenue source (dollar amounts in millions):


	Three Months Ended June 30, 2024
By product type and family:	Siding		OSB		LPSA		Other		Total
Value-add
Siding Solutions	$	413	$	—	$	4	$	—	$	417
OSB - Structural Solutions	—		197		41		—		238
	413		197		45		—		655
Commodity
OSB - commodity	—		149		—		—		149

Other
Other products	2		4		1		2		10
	$	415	$	351	$	46	$	2	$	814

	Three Months Ended June 30, 2023
By product type and family:	Siding		OSB		LPSA		Other		Total
Value-add
Siding Solutions	$	318	$	—	$	6	$	—	$	324
OSB - Structural Solutions	—		135		46		—		180
	318		135		52		—		504
Commodity
OSB - commodity	—		92		—		—		92

Other
Other products	2		2		1		9		14
	$	320	$	229	$	53	$	9	$	611


	Six Months Ended June 30, 2024
By product type and family:	Siding		OSB		LPSA		Other		Total
Value-add
Siding Solutions	$	772	$	—	$	11	$	—	$	783
OSB - Structural Solutions	—		371		79		—		451
	772		371		90		—		1,234
Commodity
OSB - commodity	—		283		—		—		283

Other
Other products	4		9		3		5		22
	$	776	$	664	$	93	$	5	$	1,539

	Six Months Ended June 30, 2023
By product type and family:	Siding		OSB		LPSA		Other		Total
Value-add
Siding Solutions	$	647	$	—	$	14	$	—	$	661
OSB - Structural Solutions	—		239		92		—		330
	647		239		106		—		992
Commodity
OSB - commodity	—		175		—		—		175

Other
Other products	4		4		2		17		28
	$	651	$	418	$	108	$	17	$	1,195

Revenue is recognized when obligations under the terms of a contract (e.g., 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 a reduction in net sales at the time the program is initiated and/or the revenue is recognized. The costs include, but are not limited to, volume allowances and rebates, promotional allowances, and cooperative advertising programs. These costs are recorded at the later of (i) the time of sale or (ii) 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 our estimates of customer volume achievement and other factors incorporated into customer agreements, such as new product purchases, store sell-through, merchandising support, and customer training. 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.

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, restricted stock units, and performance stock units) be excluded from the calculation of diluted earnings per share for the periods in which losses 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 June 30,				Six Months Ended June 30,
	2024		2023		2024		2023




Net income (loss) attributed to LP	$	160	$	(20)	$	267	$	1

Weighted average common shares outstanding - basic	72		72		72		72
Dilutive effect of employee stock plans	—		—		—		—
Shares used for diluted earnings per share	72		72		72		72
Earnings per share:



Basic	$	2.23	$	(0.28)	$	3.72	$	0.02




Diluted	$	2.23	$	(0.28)	$	3.71	$	0.02

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 net carrying value of the 3.625% Senior Notes due in 2029 (2029 Senior Notes) was $347 million as of June 30, 2024 and December 31, 2023. Based on market quotations, the fair value of the 2029 Senior Notes was estimated to be $319 million and $314 million as of June 30, 2024 and December 31, 2023, respectively. 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. All loans under the Credit Agreement become due on November 29, 2028. As of June 30, 2024, there were no outstanding borrowings under our 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):


	June 30, 2024		December 31, 2023
Trade receivables	$	137	$	104
Other receivables	24		26
Income tax receivable	2		27
Allowance for doubtful accounts	(2)		(2)
Total Receivables	$	161	$	155

Trade receivables are primarily generated by sales of our products to our wholesale and retail customers. Other receivables as of June 30, 2024 and December 31, 2023 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):


	June 30, 2024		December 31, 2023
Logs	$	70	$	81
Other raw materials	46		53
Semi-finished inventories	32		27
Finished products	224		217
Total Inventories	$	373	$	378

NOTE 7. BUSINESS EXIT CHARGES AND CREDITS

During the second quarter of 2023, we ceased the manufacturing operations of Entekra Holdings, LLC (Entekra), an off-site framing operation previously reported within our “Other” category, which comprises other products that are not individually significant. During the second quarter of 2024, the equity method investment held by Entekra sold substantially all of its net assets resulting in a $16 million distribution to LP and a gain of $11 million, which was recorded within equity in unconsolidated affiliate on the Condensed Consolidated Statements of Income.

Business exit charges and credits consisted of the following (dollar amounts in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Impairment of property, plant and equipment, operating lease assets, and other intangible assets1	$	—	$	(24)	$	—	$	(24)
Gain on sale of assets from an equity method investment2	11		—		11		—
Restructuring and other related charges:
Inventory write-down3	—		(6)		—		(6)
Other expenses including personnel-related costs such as severance4	3		(3)		3		(3)
	$	14	$	(34)	$	15	$	(34)

1Included within impairment of long-lived assets, net on the Condensed Consolidated Statements of Income.

2Included within equity in unconsolidated affiliate on the Condensed Consolidated Statements of Income.

3Included within cost of sales on the Condensed Consolidated Statements of Income.

4Included within other operating credits and charges, net on the Condensed Consolidated Statements of Income.

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 six months ended June 30, 2024 are provided in the following table (dollar amounts in millions):


	Timber Licenses1		Goodwill		Developed Technology
Beginning balance December 31, 2023	$	25	$	19	$	7


Amortization	(1)		—		—
Ending balance June 30, 2024	$	23	$	19	$	7

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 provision for income taxes for the six months ended June 30, 2024 and 2023 reflected an estimated annual effective tax rate of 25% and 34%, respectively, excluding discrete items discussed below. The total tax provision for the three and six months ended June 30, 2024 was $53 million and $94 million, respectively, compared to $21 million and $22 million for the comparable periods in 2023, respectively. The total effective tax rate for the six

months ended June 30, 2024 was 26%, compared to 95% for the comparable period in 2023. The year-over-year decrease in the effective tax rate was primarily a result of a discrete tax expense of $22 million recorded in the quarter ended June 30, 2023 relating to the change in indefinite reinvestment assertion on Chile and Brazil earnings.

We recognized net discrete tax expenses of $4 million and $15 million in the six months ended June 30, 2024 and 2023, respectively. The net discrete tax expense in the current year primarily relates to inflationary tax adjustments in certain South American entities while the net discrete tax expense in the prior year primarily relates to the change in management’s indefinite reinvestment assertion in the second quarter described in "Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

In 2021 the Organization for Economic Cooperation and Development (OECD) announced an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two Model Rules defining the global minimum tax, which establishes a global minimum effective tax rate of 15% for multinational enterprise groups with annual global revenue exceeding 750 million Euros. On June 20, 2024, the Canadian government enacted legislation implementing aspects of the OECD’s minimum tax rules under the Pillar Two Framework, effective in 2024; however, proposed legislation related to other aspects of the framework has not yet been released by the Canadian government, but is expected in the future. We considered the new Canadian legislation as part of our second quarter 2024 tax provision and concluded that (i) it had no impact on our consolidated financial statements for the six months ended June 30, 2024, and (ii) we expect there to be no impact on our Consolidated Financial Statements for the year ending December 31, 2024. No other jurisdictions in which LP operates have enacted Pillar Two legislation at this time. The Company is continuously monitoring the expanding adoptions of Pillar Two legislation and assessing its potential impact on our future tax liability.

NOTE 10. COMMITMENTS AND CONTINGENCIES

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


	June 30, 2024		December 31, 2023
Environmental reserves	$	26	$	26
Other reserves	—		—
Total contingencies	26		26
Current portion (included in Accounts payable and accrued liabilities)	(1)		(1)
Long-term portion	$	25	$	25

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 based on 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 arising in our ordinary course of business. Based on the information currently available, management believes the resolution of such ongoing and future proceedings will not have a material effect on our financial position, results of operations, cash flows, or liquidity.

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 such carrying values. 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 June 30, 2024, 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 and six months ended June 30, 2024 and 2023, is summarized in the following table (dollar amounts in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Beginning balance	$	8	$	8	$	8	$	8
Accrued to expense	1		1		1		1

Payments made	—		(1)		(1)		(1)
Total warranty reserves	8		8		8		8
Current portion of warranty reserves (included in accounts payable and accrued liabilities)	(2)		(2)		(2)		(2)
Long-term portion of warranty reserves (included in other long-term liabilities)	$	6	$	7	$	6	$	7

We continue to monitor warranty and other claims associated with our products and believe, as of June 30, 2024, 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. ACCUMULATED COMPREHENSIVE LOSS

Accumulated comprehensive loss is provided in the following table for the three months ended June 30, 2024 and 2023 (dollar amounts in millions):


	Translation Adjustments		Other		Total
Balance at March 31, 2024	$	(104)	$	—	$	(104)

Translation adjustments	(4)		—		(4)
Balance at June 30, 2024	$	(108)	$	—	$	(109)
	Translation Adjustments		Other		Total
Balance at March 31, 2023	$	(79)	$	(1)	$	(80)

Translation adjustments	1		—		1
Balance at June 30, 2023	$	(78)	$	(1)	$	(78)

Accumulated comprehensive loss is provided in the following table for the six months ended June 30, 2024 and 2023 (dollar amounts in millions):


	Translation Adjustments		Other		Total
Balance at December 31, 2023	$	(89)	$	(1)	$	(89)

Translation adjustments	(20)		—		(20)
Balance at June 30, 2024	$	(108)	$	—	$	(109)
	Translation Adjustments		Other		Total
Balance at December 31, 2022	$	(94)	$	(5)	$	(99)
Reclassified to income statement, net of taxes1	—		4		4
Translation adjustments	16		—		16
Balance at June 30, 2023	$	(78)	$	(1)	$	(78)

1 Amounts of actuarial loss and prior service cost are components of net periodic benefit cost.

NOTE 14. 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 June 30,				Six Months Ended June 30,
	2024		2023		2024		2023

Reorganization charges	$	(1)	$	(1)	$	(3)	$	(4)
Legal settlement	—		(16)		3		(16)




Other	3		(3)		3		(6)
Other operating credits and charges, net	$	2	$	(21)	$	3	$	(26)

Other non-operating items

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


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023











Pension settlement charges	$	—	$	—	$	—	$	(6)

Foreign currency gain (loss)	5		(8)		6		(11)
Other	—		—		—		1
Other non-operating items	$	5	$	(8)	$	6	$	(16)

NOTE 15. 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 products are 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 and credits, 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 June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
NET SALES BY BUSINESS SEGMENT
Siding	$	415	$	320	$	776	$	651
OSB	351		229		664		418
LPSA	46		53		93		108
Other	2		9		5		17

Total sales	$	814	$	611	$	1,539	1,195
NET INCOME TO ADJUSTED EBITDA RECONCILIATION
Net income (loss)	$	160	$	(21)	$	267	$	1
Add (deduct):
Net loss attributed to non-controlling interest	—		1		—		—

Income (loss) attributed to LP	160		(20)		267		1
Provision for income taxes	53		21		94		22
Depreciation and amortization	31		29		62		57
Stock-based compensation expense	4		3		11		7

Other operating credits and charges, net	1		17		1		22
Business exit charges and credits	(14)		34		(15)		34

Interest expense	4		3		8		6
Investment income	(6)		(2)		(11)		(7)
Pension settlement charges	—		—		—		6
Other non-operating items	(5)		8		(6)		11
Adjusted EBITDA	$	229	$	93	$	411	$	159
SEGMENT ADJUSTED EBITDA
Siding	$	105	$	59	$	195	$	126
OSB	125		37		215		42
LPSA	10		13		20		24
Other	(2)		(6)		(3)		(14)
Corporate	(9)		(9)		(16)		(19)
Adjusted EBITDA	$	229	$	93	$	411	$	159

NOTE 16. SUBSEQUENT EVENTS

Subsequent to June 30, 2024, through August 6, 2024, we used $64 million to repurchase 0.7 million shares of LP common stock under the Company's existing share repurchase program authorized in May 2022.

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 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. We encourage you to review the risks and uncertainties described in the sections titled "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements" included in our 2023 Annual Report on Form 10-K and in this quarterly report on Form 10-Q. These risks and uncertainties could cause actual results to differ materially from those projected in the forward-looking statements contained in this quarterly report on Form 10-Q or implied by past results and trends. Our historical results are not necessarily indicative of the results that may be expected for any period in the future, and our interim results are not necessarily indicative of the results we expect for the full fiscal year or any other period.

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, and reliability. Our manufacturing facilities are located in the U.S., Canada, Chile, and Brazil. To serve these markets, we operate in three segments: Siding, OSB, and LPSA.

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 July 17, 2024, that actual single-family housing starts were 7% higher for the three months ended June 30, 2024, and 16% higher for the six months ended June 30, 2024, as compared to the same periods in 2023. Actual multi-family housing starts for the three and six months ended June 30, 2024 were about 35% lower as compared to the same periods in 2023. Repair and remodeling activity is difficult to reasonably measure, but many indicators suggest that it has declined modestly year-over-year.

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. 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

Our Siding Solutions products are specialty building materials and are 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 in North America and South America. We have consistently grown our Siding segment above the underlying market growth rates. Our Siding segment is generally less sensitive to new housing market cyclicality since a majority of its demand comes from other markets, including off-site structure producers 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.

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. We cannot predict whether the prices of our OSB products will remain at current levels or increase or decrease in the future.

Critical Accounting Policies and Significant Estimates

Note 1 of the Notes to the Consolidated Financial Statements included in our 2023 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, 2023.

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 before interest expense, provision for income taxes, depreciation and amortization, and excluding stock-based compensation expense, loss on impairment attributed to LP, business exit charges and credits, 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 (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, excluding loss on impairment attributed to LP, business exit charges and credits, 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 (Adjusted Income). We also disclose Adjusted Diluted EPS, which is 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. Reconciliations of Adjusted EBITDA, Adjusted Income and Adjusted Diluted EPS to their most directly comparable U.S. GAAP financial measures, net income, income attributed to LP, and income attributed to LP per diluted share, respectively, are presented below.

Adjusted EBITDA, Adjusted Income, and Adjusted Diluted EPS are not substitutes for the U.S. GAAP measures of net income, income attributed to LP, and income attributed to LP 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.

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


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income (loss)	$	160	$	(21)	$	267	$	1
Add (deduct):
Net loss attributed to non-controlling interest	—		1		—		—

Income (loss) attributed to LP	160		(20)		267		1
Provision for income taxes	53		21		94		22
Depreciation and amortization	31		29		62		57
Stock-based compensation expense	4		3		11		7

Other operating credits and charges, net	1		17		1		22
Business exit charges and credits	(14)		34		(15)		34

Interest expense	4		3		8		6
Investment income	(6)		(2)		(11)		(7)
Pension settlement charges	—		—		—		6
Other non-operating items	(5)		8		(6)		11
Adjusted EBITDA	$	229	$	93	$	411	$	159
SEGMENT ADJUSTED EBITDA
Siding	$	105	$	59	$	195	$	126
OSB	125		37		215		42
LPSA	10		13		20		24
Other	(2)		(6)		(3)		(14)
Corporate	(9)		(9)		(16)		(19)
Adjusted EBITDA	$	229	$	93	$	411	$	159

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


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net income (loss) per share - diluted	$	2.23	$	(0.28)	$	3.71	$	0.02

Net income (loss)	$	160	$	(21)	$	267	$	1
Add (deduct):
Net loss at