Company: LPX
Filing Date: 2025-05-06
Form Type: 10-Q
Source: 0000060519-25-000015
Chunk: 24

Company: LOUISIANA-PACIFIC CORP
Filing Date: 2025-05-06
Form: 10-Q
Item: Part I, Item 2
Chunk 24
---
 from our estimates of future demand, pricing, and production costs, assuming certain levels of planned capital expenditures. However, 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. No impairment was recognized during the three-months ended March 31, 2025.

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 such assets.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to fluctuations in foreign currency exchange rates, commodity prices and interest rates which could impact our results of operations and financial condition.

Foreign Currency Risk

Each of our international operations has transactional foreign currency exposures related to buying and selling in currencies other than the local currencies in which it operates. Exposures are primarily related to the U. S. dollar relative to the Canadian dollar, the Brazilian real, the Chilean peso, and the Argentine peso. We also have translation exposure resulting from translating the financial statements of foreign subsidiaries into U. S. dollars. Although we have in the past entered into foreign exchange contracts associated with certain of our indebtedness and may continue to enter into foreign exchange contracts associated with major equipment purchases to manage a portion of the foreign currency rate risk, we historically have not entered into currency rate hedges with respect to our exposure from operations, provided we may do so in the future.

Commodity Price Risk

Some of our products are sold as commodities, and therefore sales prices fluctuate daily based on market factors over which we have little or no control. The most significant commodity product we sell is OSB. There have been no material changes to the assumed production capacity and annual average price sensitivity for OSB previously disclosed under the caption “ Item 7A. Quantitative and Qualitative Disclosures about Market Risk” in our 2024 Annual Report on Form 10-K. We historically have not entered into material commodity futures and swaps, although we may do so in the future