Norbord Reports First Quarter 2018 Results

Norbord Inc. (TSX and NYSE: OSB) today reported Adjusted EBITDA of $170 million for the first quarter of 2018 versus $103 million in the first quarter of 2017 and $204 million in the fourth quarter of 2017. The year-over-year improvement is primarily due to higher North American oriented strand board (OSB) prices and shipment volumes, as well as higher European panel prices. The quarter-over-quarter decrease is due to lower North American OSB price realizations and shipment volumes. North American operations generated Adjusted EBITDA of $156 million compared to $102 million in the same quarter last year and $195 million in the prior quarter. European operations delivered Adjusted EBITDA of $18 million versus $6 million in same quarter last year and $12 million in the prior quarter.

“Our first quarter Adjusted EBITDA result is 65% higher than this time last year and reflects the continued improvement in new home construction activity and other OSB end uses,” said Peter Wijnbergen, Norbord’s President and CEO. “Our mills ran slower in what was a particularly harsh winter, impacting costs; however, the additional production from our recently restarted Huguley, Alabama mill helped mitigate this headwind. At the same time, North American benchmark OSB prices have been unseasonably strong due to steady demand, continued low apparent inventory levels and supply constraints stemming from weather-related logistics challenges, particularly in the west.”

“Our European business delivered $18 million of Adjusted EBITDA, its best result in over a decade. Our key markets remain strong as robust demand growth across the UK and Germany supported improved prices. I’m pleased with the progress our Inverness, Scotland mill is making as the new continuous press line ramps up and we anticipate the new finishing end installation to be complete by the end of this year.”

“As we enter the spring homebuilding season, North Central benchmark OSB prices are currently 22% higher than this time last year. Given our extended order files and customer reports of lean inventories, we don’t believe that the publicly-announced capacity additions will fully meet the forecasted OSB demand growth in the near term. In Europe, our panel business is on track for an excellent year as OSB continues to gain market share versus plywood.”

Norbord recorded Adjusted earnings of $96 million or $1.10 per diluted share ($1.11 per basic share) in the first quarter of 2018 versus $50 million or $0.58 per share (basic and diluted) in the first quarter of 2017 and $123 million or $1.41 per diluted share ($1.42 per basic share) in the fourth quarter of 2017. Adjusted earnings exclude non-recurring or other items and use a normalized income tax rate:
more detail at: https://www.prnewswire.com/news-releases/norbord-reports-first-quarter-2018-results-declares-quarterly-dividend-300641717.html

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