Norbord Reports First Quarter 2019 Results; Declares Quarterly Dividend

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  • Adjusted EBITDA of $42 million
  • Earnings of $0.01 per diluted share; Adjusted loss of $0.02 per diluted share
  • European EBITDA increased 17% year-over-year to $21 million
  • Repurchased $39 million of shares, exhausting Normal Course Issuer Bid limit
  • Declared quarterly variable dividend of C $0.40 per share for shareholders of record on June 1, 2019

TORONTO, ON (May 2, 2019) – Norbord Inc. (TSX and NYSE: OSB) today reported Adjusted EBITDA of $42 million in the first quarter of 2019 compared to $70 million in the fourth quarter of 2018 and
$170 million in the first quarter of 2018. The decrease versus both comparative periods was primarily due to lower North American oriented strand board (OSB) prices. North American operations generated Adjusted EBITDA of $23 million compared to $50 million in the prior quarter and $156 million in the same quarter last year. European operations delivered Adjusted EBITDA of $21 million compared to $24 million in the prior quarter and $18 million in the same quarter last year.

“The pace of US housing construction began to decelerate in the second half of last year and this trend carried over into the first quarter,” said Peter Wijnbergen, Norbord’s President and CEO. “Further, the seasonally slowest time of year was exacerbated by unusually wet weather in many of our North American operating regions. Combined, these factors led to very disappointing market conditions and prompted us to take extensive downtime across our North American mills. This negatively impacted our production volumes and manufacturing costs.”

“US housing demand has clearly pulled back in the last nine months and the market has yet to recover in terms of volume. We remain of the view that this is a pause rather than a directional shift. US housing fundamentals remain supportive and we have already seen some of the negative trends that caused the housing pullback reverse. Mortgage rates have improved, home builders are starting to offer more entry-level homes to help first-time buyers, and home builder sentiment is improving. Although the pick-up in demand that typically coincides with the spring building season has been late in coming, housing demand is setting up for a stronger second half.”

“In Europe, our panel business had another good quarter, delivering 17% more Adjusted EBITDA year-over-year due to continued strong OSB demand in our key markets and the ramp-up of our modernized and expanded Inverness, Scotland mill. The second-phase of investment at Inverness is now underway and will help us serve growing customer demand for several years to come.”

Link to press release

Source: Norbord