Good day ladies and gentlemen, and welcome to the first quarter 2008 Louisiana-Pacific Corporation earnings conference call. (Operator Instructions). I would now like to turn the call over to our host for today's call, Mr. Curt Stevens, Executive Vice President of Administration and CFO. Please proceed sir.

Thank you very much, and thank all of you for joining us, on LP's earnings call to review our results for the first quarter 2008. As the moderator said I am Curt Stevens the CFO. With me today our Rick Frost, LP's Chief Executive Officer, Mike Kinney and Becky Barckley, who handle our Investor Relations, along with their other duties and Jeff Poloway our Controller. I will start the call with the review of the financial results for the first quarter to discuss the performance of each of our individual segments and comment on the balance sheet. I’ll then I will turn over to Rick who will discuss our accomplishment and other actions during the quarter and his thoughts as we execute our plans for the rest of 2008. As we have done in the past, this call has been opened up to the public, and we are doing a webcast which can be accessed through www.lpcorp.com Additionally, to help with the earnings call, we have provided a presentation that has supplemental information. I will reference these slides as I go through the discussion. As a caution, to pass this presentation should be reviewed in conjunction with the publicly available earnings release. I want to remind the participants about the forward-looking statements comment that is included in our earnings release and shown on slide through the presentation. Also be aware of the discussion on we use non-GAAP financial information included on slide three of the presentation. We do have an appendix attached that contains the necessary reconciliation. I'm not going to read all these statements, but I will incorporate with this reference. First slide, I am going to address is slide four, which has a discussion in Q1, 2008 results, compared to the same quarter last year and last quarter.…

Well, good morning everyone. I usually start with a weather report, it’s a beautiful day here in Nashville, without a cloud in the sky and it's about 70 degrees and that’s the good news. I do thank you all for your interest in LP building products and your interest in our call this morning. We have released, and Curt has reviewed with you our financial results. This is currently a decimal housing environment and that is coupled with no evident, end of concerns with mortgage debt and other debt related markets, but through this quarter I think we have stayed on mission and had some decent accomplishments that will contribute to LP’s longer-term future. In 2007 as I announced that the last call, we did have our safest year ever at LP with a TIR of 0.87 this earned us the number one position for the second year a roll of AF&PA’s drilling Products companies. I am pleased to announce that in Q1 we did even better we had an incident rate of 0.62. Now, this was accomplished in spite of the adversity in the market and resulting intermittent running of our mills, which presents all of our people more hazards operating environment due to distractions and the starting and stopping of operations. We did re-brand dozens of products at the International Builders’ Show this year in February, and we also introduced a handful of new products. We have relaunched a broader and technically improved SmartSide external siding product line that included both and softwoods and variable[Inaudible] and we added zinc borate, which is included now in the recipe of our fine fiber base siding previously, known as hardboard. We also launched a re-branded family of high-performance OSB flooring products at the show, and that is going well. We also…

Thank you Rick. Dan if we go to the Q-and-A.

(Operator Instructions) Your first question comes from the line of Gail Glazerman from UBS, please proceed.

I was wondering if you can talk just a little bit more about the current OSB market. What you think has driven the recent improvements and given your outlook for higher mill down days is that just that you expect more output from Clark County or is there something in the market that you are seeing.

I think probably active supply and demand are getting closer together and so that is tightening up the amount of available open market. I don’t think that you seen a shift in demand. I think that the two are just closer together.

Okay and I mean when you talked about CapEx being dialed back to maintenance levels is there any change from your prior guidance or can you just reiterate what that guidance is for the year.

Well for the year there is a couple of things in the cash flow; one is, we had two very large mills under construction at the end of last year that we finished up in Q1. So we had accrued at the end of Q4 a little over $40 million in payables related to those mills that we will pay -- that we paid in the first quarters and the second quarter and then in addition to that, we do have the two acquisition opportunities that Rick talked about, that Brazilian acquisition and that potential JV, sometime this summer and combined those would be about $100 million and then in addition to that there’s about 60 million that would be core maintenance and finishing up the projects. So, we add all that together, we get about 200 with a 100 of that being acquisitions and 100 of it being the completion of the major projects and maintenance CapEx.

Okay and changing gears, can you give a little bit of an update on the OSB anti trusts situation that looks like a couple of more competitor have settled?

I can't give an update on that. I think as you said we did have one of the competitors announced yesterday so at this point, all of the defendants in the case except us have settled. As you’ve seen in their public releases, all of the dependants have denied any liability or any wrong doing and we are certainly not going speculate on why they agreed to settle. As far as us, we are preparing for trial which starts in early June, but beyond that it's probably not prudent for us to talk about the specifics of the pending litigation.

Your next question comes from the line of Peter Ruschmeier from Lehman Brothers. Please proceed. Peter Ruschmeier – Lehman Brothers: Thanks, good morning. I was curious about -- slide 10 shows $541 million of working capital at the end of the quarter. I was curious Curt on how much of an much opportunity you may have as you look at it with the next several quarters of monetizing some of that working capital?

Actually it’s was good opportunity. Included in the receivable number is a big tax receivable. We have about a $150 million that we are anticipating coming in the third quarter about half in Canada and half in the U.S. So, that’s a piece of it that we would expect to realize, the other piece of that is we do build our log inventory in the northern mills in the first quarter and we basically don’t do much logging in the second quarter in those northern mills so we’ll bringing down that log inventory and that happens every year. So, those are probably too biggest changes to monetize some of that. Peter Ruschmeier – Lehman Brothers: Any more color you can offer on the tax receivable what that's related to?

Its related to not making money last year. Peter Ruschmeier – Lehman Brothers: Right, okay. Maybe a question for Rick, if I could; I was just curious in this difficult environment how you think about assessing downtime in your system, you obviously got some lower cost facilities and others, in perfect world, you might run that the real low-cost facilities flat out and take the others down, but that’s perhaps not feasible, can you just share with us how you schedule and plan in this environment?

Well, I think the first promise is that we have to look at it regionally in terms of the markets that we are selling into, so we take our customer demand and then we apply that back to regional production, so that’s how we have been doing it with the exception of the two mills that we shut down last year. I think problematic for us going forward and probably where you are going is as we do ramp up Clark County, we’ll have a world class facility there and in this market there will necessarily be room for all the additional wood and so, we will be force here in the -- probably over the next three months to look very hard at making room for the Clarke County wood and we may have to do that that at the expense of other facilities in terms of making some tougher decisions that we made so far. Peter Ruschmeier – Lehman Brothers: Okay. That’s helpful. Last question, if I could. Rick I was curious if you could elaborate on your international strategy. Obviously, you have made some moves in Brazil, you continue to look at work in Chile, if we think about your equity exposure to your OSB, how much ends up offshore today either directly through these interest or indirectly through exports and should we expect that number to rise much over the next few year?

I think, we’ve got about 8% of our active production right now being exported that’s out of North America. We probably have about 15% of our Chile -- in production going to countries other Chile. One of the purposes of building Lautaro, was to continue to feed the Chilean growth in terms of the fact that more and more stick free bill housing is occurring down there and we basically got sold out, so we were having to limit the amount of exports from Chile and to other continents. So now with Lautaro starting up and we should I think by next month be up to about 6,000 cubic meters and then continuing to ramp that up throughout the year. We can start pushing harder again on exports from Chile so we think that with the addition of the season mill, hopefully being able to replicate on a much broader scale or larger scale of success we’ve had in Chile in terms of selling into local markets and changing our home construction norms that there will also be an opportunity to export some volume out of Brazil, but our main goal down there is to teach them, how to build the way that we build our peer and have the predominance of that product consumed in South America. Peter Ruschmeier – Lehman Brothers: And not to cut this too finely, but would it be an unrealistic goal to double or triple those export numbers over a three to five year period or any high-level expectation that you have as to what kind of international opportunity you’re really looking at?

I think that’s very realistic. I think the other thing that you probably have to keep in your head is that right now in this North American market, as I’ve said before, most people come to the same conclusions, so my guess would be that anybody that’s got OSB right now, is trying to push it offshore. Peter Ruschmeier – Lehman Brothers: Yeah.

I did say, I think maybe it was a year conference -- a year to year and a half ago, and it’s looking like it may actually come true; I offered the long term observation that North America may actually end up being an exporter, a long-term of wood products simply because of tree availability in some of the other continents and I am starting to see that get some lags particularly with the Russian decree of putting the very high export tax on any of their trees; that’s going to dry up tree supply for countries and I think they are going to look to Canada and the U.S. and to places like South America which we are hoping to gain more of the structural panel.

Your next question comes from the line of Mark Weintraub from Buckingham Research. Please proceed.

Thank you. First Curt I just wanted to follow-up on the account receivables. So was that $65 million or $68 million increase in the account receivables; was that related to the income tax receivables. I thought the income tax receivable already was about $155 million at the end of last year.

Well, there is an additional cooling in Q1 that went into the receivable for the current period.

Okay. So it was -- so, what was behind -- so is that what was largely behind the credit built?

The increase in the income tax deals is about $35 million and then the other increase in trade receivables if you remember every year December 31 we run a DSO of about 20 days. So -- and the last two weeks in December nobody is building, so our accounts receivable balance is the lowest it ever is at the end of December.

So, that’s just a normal seasonal increase that’s you saw there?

Seasonal increase in the first quarter.

On the cap spending and the acquisition where are you in terms of making a decision on Brazil and the JV and do you have the flexibility or are you looking at financing these separate from what ever you might already have in place or have the prices for these acquisitions changed at all given the type of environment that we’re in because obviously folks are looking at what’s happen with the stock and what’s happen with the stock market assessment of values of businesses. I am just trying to find out whether or not you are seeing that in the external world as you are looking at moving forward with your strategy.

Well the South American asset as you know we signed that Memorandum of Understanding at the middle of December with Masisa and that included a due diligence period and some other work between then and now. We are currently in a position were I expect to close the first days of that in the next couple of weeks with that. There have been some modifications to the deal we struck in December, but I wouldn’t consider them to be meaningful. We have explored the possibility of our standalone financing to that facility and it’s still a possibility, probably a possibility further down the roads than right now. So, in answer to your question, we are planning on proceeding the next couple of weeks to the first phase of the Brazilian acquisition and the one that I mentioned for the summer is yet to be determined, but I just want to make sure that you had that in your plan.

Okay and then, if I understood you correctly, you consider your maintenance spending to be about $60 million a year, additional to the acquisition stuff etc and then there is $40 million, which was related to finalizing some of the expansion projects and so, next year if your maintenance levels is $60 million type of number that one should be penciling in?

I look at it a little bit differently, because when you have -- the $40 million was the carryover that was accrued at the end of the year. We also had additional expenses in Q1 that were not accrued, that were related to the completion of those projects. So, I think you are probably better of looking at maintenance expense which we have talked about before in the $1 million to $1.5 million for facility, which would put that in the $40 million range, $30 million to $40 million.

Okay right.

I think it was a little high for maintenance.

Okay.

And I will add to that; we’re going to connect to (inaudible) so I think that 40 might even be higher for me. We have to work a little more; I have got some of my friends around the table who that directly impacts, but we are having robust discussions about what -- under these conditions about ’09 and ‘10 ought to be.

Fair enough and lastly, you mentioned several startup losses. I don’t know how much detail you want to give in. Can you give us a ball park for what the total impact on the quarter it was, from Chile and also in Clarke County?

I can give you some rough numbers. In the Engineered Wood about two thirds of that loss related to the whole thing because we didn’t sell any product out of it and had all the expenses of starting that up. So, I give you an order of magnitude on the Engineered Wood. On Clarke County after I -- not going to give you a number on that, but we didn’t sell any product out of that until end of March and early April so, again you have the expenses of having all the folks there, but not any production capacity and then in Chile, they combined with this -- the difference in the sales price and the startup Lataro, was about $2.5 million swing, where they lost about a little over $1 million and they made money last year and that will be attributable to those few factors.

Your next question comes from the line of Christopher Chun from Deutsche Bank. Please proceed.

Your press release provided us production volume, but I was wondering if you could provide sales volumes for the quarter

We have always provided the production volume, that’s what’s in there.

Right and can you give us an idea of just on a seasonal basis what your sales volume as like compared to production volumes in 1Q?

Okay, that’s helpful and then going back to the issue of -- is that an earlier call they raised about the different cost structures at your different mills. Can you talk about how flat or steep the cost curve among your different mills might be?

Its pretty flat. I think that largest influence is the parity of the dollar so that the operations north of the boarder are more expensive than the operations south of the border and that affects decision making right now. All those investments we’re made at a different dollar rate and with the change that’s occurred, their more expensive operations up there, particularly in Eastern Canada.

I think the other piece you have to look at Christopher is that what the customer care is about is the delivered cost, so getting the wood where they need it and that’s an adder to whatever the mill FOB price is and when you take that freight into consideration, that’s why Ricks comment about making regional decision is so important. As you make a decision if the demand in the West Coast is down, that’s going to influence your Western Canadian mills and it probably isn’t going to have any impact at all in your decisions in the lake state. So, you really do need to look at it delivered basis and look at it by region.

Yeah that’s an interesting point Curt. Tell us -- on average when your talking about the delivered by the customer, how much of that is freight from the mill?

You know for us its like -- its about -- well its changing with the diesel environment on a regular basis in dislocations and rail, but it is about $20 a 1000 average across our system.

Your next question comes from the line of Rick Skidmore from Goldman Sachs. Please proceed. Please proceed.

Wanted to come back Curt, if you would just on the cash in 2008, $600 million for acquisitions and CapEx.

Rick I think we lost you.

Can you just go through the puts and takes on the cash flow 2008? Actually, on CapEx?

The question I was responding to was on capital and what I said, is there’s about $100 million that would be for acquisitions for that Brazilian mill and this potential JV interest there was about a $100 million in capital expenditures with 40 of that being a carryover that was accrued at 12/31 of ’07.

Okay and then you’ve got the 160 tax refund coming in later in the year and then whatever you’re doing on the dividend fronts. If you take these cash flow items in the year?

Well, other than operations, which we are not going to give you a forecast on that, but I think what Rick said is it’s not a very good environment out there.

Your next question comes from the line of Mark Wilde from Deutsche Bank. Please proceed.

Hi, good morning. Can you talk Curt just about what you are done at what’s your at -- your trade receivables right now that kind of protect yourself on the bad debt side of things?

Well we have -- obviously we have a credit department. I believe we have on of the best credit guys in the industry; a guy named Bruce Iddings. Bruce manages that very directly. He gets financial statements from the private companies, he public financial statements, he visit our customers, he has a rather sophisticated way that he tracks whether they have earned the discount or not and then Q1 I just received his report and we were at 20.1 day DSO. So we were pretty close to exactly where we are at the end of last year or the end of the first quarter and last year. The challenge is that -- as you know some of our customers are feeling the pressure on their financial resources. So, we have engaged our sales force in that, we do have a couple on our watch list, we’ve actually reduced the credit facilities available. So, we’re managing it extremely reversible.

Okay. Second question, when I was in Latina America -- couple of months ago, they mention that you were studying, reciting another one of these North American mills, down into Argentina and sounds like that would be probably a minimum of two or three years off it. Can you just kind of update us with that process? And then it looks to me that if you had it back together with Brazil with the Two in Chile that you have a million units of production potentially in South America?

Okay and it will be Chile, it won’t be in Argentina. Is that right?

It could possibly be in Argentina, that’s our thought process at this point in time, but I think when we actually start firing up the computers and pulling out the pencils in terms of where the next piece of South American growth is, the landscape will have changed, but Argentina certainly seems to be a potential spot for this. We basically, can service as part of the Argentina market, now I think all of our Mesisa operation for a couple of years. So, we’re merely trying to think a little longer-term, and also accomplish the purpose of being able to sell the Woodland site and put that the equipment at least in the right continent to figure what to do within a couple of years.

Okay. And then last question on a little longer-term perspective Rick. The increase in using kind of wood residuals for bio-fuels or maybe bio-refining, how do you think about that potential impacts of that on the OSB business, over the next 10 years here in North America?

I’ll tell you, I think it’s got everybody’s attention right now, where a year ago we weren’t sure it was going to be too intrusive. You have a couple of power plants start-up around here if your a paper mill, that’s used to getting their biomass relatively free or at least just for freight. Now if we get into a situation where people are starting to that -- there is a couple of different ways, this is going to affect you. One is some intrusion into the lower diameter classes of pulp plant. In other words you -- what they really want is what we call pre-merchantable wood, which is wooded up into that 5 inch -- below 5-inch diameter class and of course when you put harvesting operation on a site like that you tend to creep-up into what would be wood for building products purposes or pulp making purposes. The other longer term potential impact of this is that the land owners and most of the land owning base with the exceptions warehouse has been separated from these large companies that we historically have dealt with. The new land owners could actually changed there timber growing resin to grow fiber and actually pre-merchantable fiber rather then trying to take that into a pulpwood class or into a log class and that to me is the longest most heavy potential re-precaution on this industry. Is if and I haven’t run the economics on it from my forestry days, but if these guys start switching from trying to grow pulp wood and logs as their in product to sitting down and saying “I’m going to grow a 10 to 12 year rotation and try to grow biomass” that could change the long-term supply of timber and obviously that’s a decade out from the time that people start thinking that way, but it’s certainly a potential.

Yes, your last question comes from the line of George Staphos from Bank of America Securities. Please proceed.

Hi, guys. Good day; a couple of questions here. I guess given the way 2008 is trending right now, how would you coach us to think about the potential in ’09, where there would be another fairly large tax refund or it would be -- would ’08 be one off in that regard?

Right now -- if you look, when we put together the tax benefit rate for the first quarter we have to take into consideration where we expect full year earnings to be and calculate the rate based on that. So, it’s simply the fact that we did put the tax benefit rate that high at 44% and didn’t increase the tax receivable I think you can assume that we expect to use the benefit of any operating losses and receive a refund next year.

Okay, fair enough and…

And I said Georgia at the annual meeting on the Thursday of last week, our expectation for ’09 is to only be marginally better than ’08 in terms of overall starts in demand.

Okay. So, I guess trying to summarize without 10 pin pointing the forecast there should be some benefits again next year that we could directionally anyway think about it in our models, that would be correct?

That would be correct

Okay. Now as far as you know safety and branding you talked about your initiatives this year but ultimately it’s in a very difficult market. How would you guide investors to gauge your performance this year since we done have quite the visibility into how you are performing other than the financials that you report. Are you gaining share? Should we expect further reductions in manufacturing cost? I mean help us try to quantify that a little bit guys that would be helpful do you have that?

While we already has two specific about share, but I also made the comment at our annual meeting that internal metrics that were keeping do indicate the efforts we have been putting in on being proactive in the marketplace are convincing us that we are gaining share in each one of our product lines. I will be -- and I think there is the Cavia to that is as one of our managers in his report to the Board said, gaining share is hard. When you can pick up a point of share you have really accomplished something, but our internal metrics suggest that there are more LP products in the homes on a volume basis per start, which is -- puts the relatively and depending -- that’s the thing that allows you to compare period-to-period of robust market versus down market. We have more LP volume per start in homes today than we did two years ago, so that’s encouraging us. On the other side of that coin, some bad news for us or news that we didn’t like is that a considerable amount of our branding work in this down market has not been very effective in terms of increasing awareness. So, what we are doing as we’re looking at our sales and marketing work and trying to measure where we’re getting a bank for our buck and we are going the stuff into hibernation where if the potential return on that is too far out, we can’t be spending money right now to help ourselves in brand awareness three years from now. So we are looking at some of those activities for hibernation.

Would that even include the giving out of the naming rights on the stadium, and -- not that material but…

That’s a done deal.

Okay.

You should think of that as a long-term centerpiece for our own LP effort. We are very happy with what we have done so far there in terms of that providing us the customer relationship that’s very special opportunity for people that we bring into that and plus we signed the contract on that, so as we told you when we did that I think we have taken money out of other areas. So, that’s not a complete addition cost, we used funds from other things that we were doing to create more of a focused approach there.

Okay. One last question, appreciating all the color and commentary on the dividend and things that’s you looking at right now and the likelihood that you will be dialing back the CapEx in a fairly significantly next year, could you review again for us Rick and Curt, the though process we have investing some amount of money in Brazil right now giving the environment; why it’s a good time to be doing that here and what kind of returns you expect and how easily will you be able take the cash that you do generate in South America over the next several years and bring it back to the States if you need that. Thanks guys.

Well, let me just try about this. The Brazilian decision really is a decision to expand our presence internationally. We have had a very good experience in Chile. Brazil got 220 million, 230 million people underserved for housing needs right now. We think we can take the experience in Chile and move that into Brazil successfully. From a timing perspective when these mills become available, you want to strike while you can. We have been in discussions with Masisa for several years and we do believe that that this is the right time given the strategic direction they are going and how we would want to expand it’s presence. We have looked at and one of the reasons that’s we are willing to going to Brazil is that Brazil from an economic standpoint has gotten much better than historic. I think you just saw that as into S&P or Moody's or one of them just raised there, their sovereign debt rates up to investment rate which is a very good sign. The way we are structuring the transaction we should have no problem brining back our investment in the facility or our earnings in the future very taxable.

I think the way to think about South America is making the pie bigger. The long-term forecast for US 1.8, 1.85 starts is -- that’s about what its going to be and at through the last boom, I think we ended up with an industry that was sized to be able service two million starts or more. So if you have a limited market here but yet the product and the building techniques are favorable in emerging countries and it was either Mark or Rich mentioned earlier. We can potentially have a billion feet of production in South America which if you put that compared to what we produce up here in North America that will be a substantial part of our company going forward. So we look at it as a way to continue to grow this company understanding that in this country, demand overtime is about 1.8 to 1.85.

Understand. Realize the long term growth opportunities, but also obviously got some challenges here domestically so that's why I raised it. Thanks guys. See you tomorrow

Alright. Thank you Dan for moderating discussion and thank all you for participating. As always Mike and Becky are available to the follow up on questions that didn't get answered during this discussion. Thanks again.

Thank you for your participation in today’s conference. This concludes the presentation. You may now disconnect. Good day.