By Note: Financial references in US dollars unless otherwise indicated.
2012 HIGHLIGHTS
- Full year earnings of $1.65 per share ($1.59 per share diluted)
- 2012 EBITDA of $188 million - a fourfold increase over the prior year
- Q4 EBITDA of $70 million - better than Q3 and eight times higher than Q4 2011
- North Central benchmark OSB price averaged $271 per Msf - a 46% increase vs. 2011 and the highest average in seven years
- North American OSB shipments 8% higher in stronger pricing environment
- Annual production records at five of Norbord's eight operating OSB mills
- Company-wide safety recordable rate of 0.74 - a best-ever result
TORONTO, ON (January 31, 2013) - Norbord Inc. (TSX: NBD, NBD.WT) today reported earnings of $72 million or $1.65 per share ($1.59 per share diluted) for the full year 2012 compared to a loss of $11 million or $0.25 per share in 2011. The Company recorded earnings of $38 million or $0.86 per share ($0.76 per share diluted) in the fourth quarter of 2012 versus a loss of $9 million or $0.21 per share in the same quarter of 2011.
Norbord generated EBITDA of $188 million in 2012 compared to $45 million in 2011. North American and European operations recorded EBITDA of $165 million and $39 million, respectively, versus $14 million and $44 million, respectively, in the prior year. In the fourth quarter of 2012, Norbord delivered EBITDA of $70 million versus $66 million in the previous quarter and $9 million in the fourth quarter of 2011.
"Our improved 2012 financial results reflect a better-than-expected recovery in the US housing market and this recovery is gaining momentum," said Barrie Shineton, President and CEO. "In North America, we increased shipments and were able to benefit from higher OSB pricing in the second half of last year. I expect this strong improvement in OSB demand to continue as we move through 2013. We are therefore advancing our plans to bring back some of our mothballed capacity. However, in spite of these plans, and the restarts announced by some of our competitors, the lag in bringing back this capacity suggests to me improving OSB demand will continue to outstrip supply for at least the next three quarters."
"In Europe, our panel business delivered another strong result in spite of the challenging macroeconomic environment. Panel markets remain surprisingly stable and we continue to benefit from an ongoing currency advantage due to a weaker Pound Sterling. Both our customer order files and panel pricing trends indicate a positive start to the year."
Market Conditions
US housing starts finished the year at 780,000, up 28% from 610,000 in 2011. Permits were 30% higher year-over-year. The seasonally-adjusted US housing starts number for December was 954,000, 37% ahead of the 2011 end-of-year pace. This is an encouraging number for what is typically a seasonally slower period for the construction industry and OSB demand.
North American OSB prices improved significantly in the second half of the year. North Central benchmark OSB prices strengthened from a February low of $188 per thousand square feet (Msf) (7
