Q1 2024 Earnings Summary
Reported on May 8, 2024 (Before Market Open)
Pre-Earnings Price$72.97Last close (May 7, 2024)
Post-Earnings Price$83.50Open (May 8, 2024)
Price Change
$10.53(+14.43%)
- Strong operational performance in the Siding segment, with EBITDA margins reaching 25% in Q1 2024, exceeding expectations due to better pricing, efficiency gains, and lower raw material costs.
- Rapid growth of new products, such as ExpertFinish, which grew from 0% volume in 2019 to 9% of volume and 14% of revenue in Q1 2024, demonstrating the company's ability to innovate and capture market share.
- Broad-based demand strength across all market segments, including new construction, repair and remodel, and consumer retail channels, leading to increased guidance and strong order files.
- The company expects EBITDA margins to decline in the second half, potentially indicating challenges in maintaining profitability levels due to increased costs or lower pricing.
- Growth in new products like 'Bush Smooth' and 'Gap Siding' may be less efficient and have lower margins than current products, potentially impacting overall margins. Additionally, the company may increase selling and marketing expenses, further pressuring margins.
- Margins on 'ExpertFinish' products are currently lower than prime products, and improving these margins may take two to three years, suggesting prolonged pressure on profitability from this product line.
Research analysts covering LOUISIANA-PACIFIC.