Good day, ladies and gentlemen, and welcome to the Louisiana-Pacific Corp. Q3 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference is being recorded. I would now like to introduce your host for today's conference, Ms. Sallie Bailey, Executive Vice President and Chief Financial Officer of Louisiana-Pacific Corp. Ma'am, you may begin. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Thank you very much, Chanel. Good morning and thank you for joining our conference call to discuss LP's financial results for the third quarter of 2015. I am Sallie Bailey, LP's Chief Financial Officer, and with me today are Curt Stevens, LP's Chief Executive Officer, as well as Mike Kinney and Becky Barckley, our primary Investor Relations contacts. I will begin the discussion with a review of the financial results for the third quarter and first nine months of 2015 to be followed by some comments on the performance of the individual segments and selected balance sheet items. And after I finish my remarks, Curt will discuss the general market environment in which LP has been operating, provide his perspective on our operating results and give some thoughts on the outlook. As we have done in the past, we have opened up this call to the public and are doing a webcast and that webcast can be accessed at www.lpcorp.com. Additionally to help with the discussion, we have provided a presentation with supplemental information that should be reviewed in conjunction with the earnings release. I will be referencing these slides in my comments this morning. We filed an 8-K this morning with some supplemental information as well as our Form 10-Q. I want…

Thank you. And our first question comes from Paul Quinn of RBC Capital Markets. Your line is now open. Please go ahead.

Hey. Thanks very much, and good morning, guys. Just a question on market-related downtime, I didn't hear the number for Q3, but I note you took like 127 days in Q1, 110 days in Q2. Just wondering what that number was for Q3 and what the plan is for Q4? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Sure, Paul. In the third quarter, we took about 50 days of downtime, which is about 74 million square feet. And we don't give indications of the fourth quarter.

Okay. And then just turning on to Siding, year-to-date volume is down 1%. You had a very, very strong Q1 and Q2. Sort of where you missed versus my bullish forecast was really on the Siding side. Just wondering why you saw it drop in Q3? Curtis M. Stevens - Chief Executive Officer & Director: Well, as Sallie mentioned in her comments and I said it as well, we look at our customers to find out where we were losing that business. And principally where we lost business in Q3 was to the prefinishers. So our prefinish customers took a lot of product in the first quarter and into the second quarter because they don't have the ability to finish it all within the quarter. So they have to put inventory in place. And then with the wet weather we had in Q2, they didn't have the outtakes in Q2, so they didn't reorder in Q3. But it really is tied to those prefinishers now. Our salespeople have talked to them. There is no reduction in their business, but there was a delay due to the wet weather. So it really is I think focused at that. As we look at October, we are having a pretty good October I think. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Paul, and another way for you to think about it is that as we went on allocation, we did see some inventory going into the channel. And as we've come off allocation, we think that inventory will come back sort of on LP's book versus our customers' book. So there's that dynamic going on as well.

Okay. And last question I had, just on CapEx. You guided $100 million in 2016 on North America. What is it in South America for the new mill? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Well, we don't really know. What we've said is it depends on the timing, as Curt talked about. But overall we think that mill could cost as much as $50 to $60 (sic) [$50 million to $60 million]. But, I think... Curtis M. Stevens - Chief Executive Officer & Director: Million dollars. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Million dollars; thank you, yes. Thought that went without saying. Depends on how the currency goes. But I think the most important takeaway is that Chile does have cash on their balance sheet as well as the ability to fund that locally. So we will not be paying for that out of our North American cash balances.

Great. That's all I had. Look forward to the higher pricing in Q4. Curtis M. Stevens - Chief Executive Officer & Director: So do we. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: So do we.

Thank you. And our next question comes from George Staphos of Bank of America Merrill Lynch. Your line is now open. Please go ahead.

Thanks, everyone. Appreciate all the details. I guess the first question I had, Sallie, was the pickup in inventory that we see on the cash flow statement in the quarter, was that in any way related to the de-stocking that you had in Siding, i.e., you had more production sitting on your balance sheet than was ultimately taken away by the customers, or were they unrelated there? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: It's mostly logs.

Okay. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: The pickup in the inventory is related to logs.

Okay. And I think you've already covered this, but I just wanted to maybe get one last affirmation. So from your vantage point, the slowdown that you saw in Siding, you don't think you're losing any ability to penetrate the market. You are not seeing any sort of competitive response that is slowing your progressions here. It's purely just timing of customers' inventory relative to your production and things are looking better as we get into the fourth quarter. Curtis M. Stevens - Chief Executive Officer & Director: That's my conclusion, George. If you look at it by segment, our retail business has been pretty good all the way through. Repair/remodeling business is largely where the finished product goes, so repair/remodeling has been off. And then with new home construction, we've seen a tremendous change in the cycle time for building a house, going from 90 days to 100 days to 170 days to 180 days. And the siding is the last thing that goes on the structure. So we think a little bit of that impact has hit us as well.

Okay. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: We also want to call your attention to that we did have a 6% price increase quarter-over-quarter and year-to-date pricing in SmartSide is up 6%. So...

Okay. All right, so you think maybe there's a little bit of pull-forward as well ahead of whatever pricing you might have had in play? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: I think the point is that we've been able to maintain price through.

Okay. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: And actually increase it year-over-year.

All right. Thanks for all the details on that, Sallie. One question for Curt; Curt, I mean to the extent that you have a view on this or your customers were commenting on the growth in Millennials, what's been catalyzing Millennials to finally start buying homes from your viewpoint, other than they are sick and tired of living in the basement of their parents' houses? Is there anything else going on in terms of – from a fundamental standpoint, that is driving that? And then quick one on OSB and I'll turn it over; from looking at some of our industry data, panels, year-to-date, are relatively flat. I don't have the breakdown of OSB versus Plywood in that number, but I noticed your volumes were up. Is that, do you think, OSB gaining market share year-to-date or do you think you've gained market share within OSB year-to-date? Thanks. Curtis M. Stevens - Chief Executive Officer & Director: Well, on the Millennials, I think it is the household formations. Again, what I said is 1.1 million in the first quarter on to 2.1 million household formations and a lot of those I think are the Millennials leaving their parents' home and actually forming relationships and beginning to have children because the birthrates are coming back up. So I think that's what's driving their participation in the market. It's a long delay when we didn't have jobs for them and now the household formation creation. On OSB, actually, our sales in Q2 from a volume standpoint out of the OSB segment were a little bit lower than last year. So I'm not sure I understand your question.

Well, year-to-date, I thought your volumes in OSB were up, unless I was mistaken. So year-to-date versus 2014, you were up 4%, which is better than my industry indicator. So I was just – if you had a specific view on that, I was curious why you think you are growing a little bit stronger than the panel market overall, whether it's OSB gaining share versus Plywood, or do you think you've gained share within OSB? That was all within the question. Curtis M. Stevens - Chief Executive Officer & Director: I think the APA industry stats would say it's up about 4% as well. So I think we're pretty consistent.

Okay. So it's then OSB gaining share versus Plywood then. All right, guys. Thanks, I'll turn it over. Curtis M. Stevens - Chief Executive Officer & Director: Okay.

Thank you. And our next question comes from Mark Connelly of CLSA. Your line is now open. Please go ahead.

Thanks. Curt, it looks to me like your Siding segment could've been a lot worse, given the year-over-year volume declines. So I looked at that performance as actually pretty good. Can you give me a sense maybe of why we didn't see a bigger hit from that 14% decline? You got some price, but I'm just wondering if it was mix that saved you? Curtis M. Stevens - Chief Executive Officer & Director: Well, it was mix; it was some price increase, but it was also a little bit of mix. We didn't run any OSB in the third quarter last year. We did run a little bit of OSB this year. So that was an offset. And then the costs in our facilities have actually gotten quite a bit better. We did have the benefit of raw materials; so we had lower raw materials in MDI, resin, and then we had a little bit of increase in zinc borate. But overall, our manufacturing costs were lower. So it's a combination of the price and better manufacturing costs.

Okay, that's very helpful. And one last thing is we've been hearing a lot of chatter about hurricane impact. Is that going to be meaningful at all to you? Curtis M. Stevens - Chief Executive Officer & Director: I don't think so.

Very good. Thank you. Curtis M. Stevens - Chief Executive Officer & Director: We don't have that in our forecast as an upside.

Good. Thank you.

Thank you. And our next question comes from Gail Glazerman of UBS. Your line is now open. Please go ahead.

Hi, good morning. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Morning.

Curt, can you give a little bit more perspective on the recent OSB price rally and what you think drove it? To what extent it might have been on the production side versus just kind of catch-up from the weather issues in the first half? Curtis M. Stevens - Chief Executive Officer & Director: Well, I do think the weather issues had some impact on that. We did take – I will just talk about LP. We did take some downtime and we also were very careful to sell into real demand and not fill the channel. We do think the channel got filled in Q1 and Q2 and that affected pricing.

Okay. And slightly related to that; the 50 million down days, is that kind of apples-to-apples to what you were taking earlier in the year, or would the outage at Swan maybe have impacted that, if you take a little more company look? Curtis M. Stevens - Chief Executive Officer & Director: Well Swan in Q3 of last year produced about 90 million feet. So the reduction that you saw for the Q3-to-Q3 is almost entirely Swan because we moved that into the Siding segment.

All right. And, Sallie, can you give some more details on kind of the raw material costs relief you've seen maybe year-over-year in the third quarter as well as year-to-date? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Yes, sure. Overall, we've been saying that raw materials would benefit us year-over-year around $50 million. And we certainly see that occurring maybe even a little bit better. On the basis of the third quarter of 2015 relative to the third quarter of 2014, logs were probably about the same, although we would've seen some improvement in OSB from logs and that would've been offset. We would have a negative impact of that on our Siding business. But we saw very positive – probably on a price basis, around $10 million quarter-over-quarter for MDIs and waxes and other resin-based inputs.

Okay. Thank you. And just one last... Curtis M. Stevens - Chief Executive Officer & Director: Gail, almost all the savings is coming from the resins and waxes that are tied into benchmarks that are oil derivatives.

Okay. And just one last one question on kind of global trade flows. Not much, but your Chilean prices were down a teeny bit sequentially. Did you see any sort of uptick in North American flows down to Chile or has the currency situation been enough to kind of keep that in check? Curtis M. Stevens - Chief Executive Officer & Director: We actually saw pressure coming from Europe in imports into Chile. We didn't see much coming down from the U.S.; mainly from Europe.

Okay. Thank you.

Thank you. And our next question comes from Ketan Mamtora of BMO Capital Markets. Your line is now open. Please go ahead.

Good morning, Sallie, Curt. Curtis M. Stevens - Chief Executive Officer & Director: Good morning. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Good morning.

Coming back to the raw materials one more time, are you seeing any impact from flooding in U.S. South on your wood costs for Q4? Curtis M. Stevens - Chief Executive Officer & Director: From the flooding?

Yes. Just, generally, is there any uptick in... Sallie B. Bailey - Chief Financial Officer & Executive Vice President: No. Curtis M. Stevens - Chief Executive Officer & Director: No. Actually, where we operate in Texas wasn't affected that much. That would've been the primary area. And then, as you know, we don't operate in South Carolina, but South Carolina did have a disruption of logs for a number of our competitors.

Got you. Okay. And then switching to Swan Valley, can you just help us provide some sort of guideline on the ramp-up? Because I know this quarter, there was a lot of noise between OSB and production and Siding. But if you can just help us provide some guideline in terms of the ramp-up? Curtis M. Stevens - Chief Executive Officer & Director: Well, as I said, we made our first board last Friday. So what we'll be doing is running that mill this week. We will be identifying the areas that we need to go in and fix, and then we will spend most of November and the first part of December making those fixes. So salable product I would anticipate wouldn't come off till the second half of December, and then we are right into the holidays. So I wouldn't say there's going to be meaningful production out of Swan until January.

Got you. And so there would obviously not be any OSB production during that time at the mill? Curtis M. Stevens - Chief Executive Officer & Director: Not at Swan.

Right. Okay. Curtis M. Stevens - Chief Executive Officer & Director: If you recall, Ketan, what we said is we would move – if we had excess capacity inside, we would move the OSB production to Hayward.

Understood. Okay. That's very helpful. Good luck in Q4. Curtis M. Stevens - Chief Executive Officer & Director: Thank you. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Thank you.

Thank you. And our next question comes from Steve Chercover of D.A. Davidson. Your line is now open. Please go ahead. Curtis M. Stevens - Chief Executive Officer & Director: Steve, we won't hang up on you. Steven Pierre Chercover - D. A. Davidson & Co.: Okay. Appreciate that. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Yes, our apologies from last quarter. Steven Pierre Chercover - D. A. Davidson & Co.: That's fine. I am pretty used to it. In South America, your profit in EBITDA were up $2 million, even though the sales were down $10 million. So was that cost improvement and is it sustainable? Curtis M. Stevens - Chief Executive Officer & Director: Well, we are running our mills in Chile at 100%. Part of the improvement, if you recall, in Q3 of last year, we lost a month of production at one of our mills because we had a flaker go down. So part of that improvement is that extra month of production in Lautaro. We have a good cost position in Chile. Brazil, our costs are getting better, although we've had a reduction in volume because of the horrible economy there. Steven Pierre Chercover - D. A. Davidson & Co.: And you are saying that it's actually getting more onerous to get the permitting for your new mill down in South America. If everything went perfect, would it be online maybe for mid-2017 or something? Curtis M. Stevens - Chief Executive Officer & Director: No. Well mid-2017, correct. That's about right. So let me just be a little more specific. What Chile did is they adopted the UN standard on Aboriginal people. So essentially what we have in Chile now is we have a situation similar to Canada with First Nations,…

Thank you. And our next question comes from Mark Weintraub of Buckingham Research. Your line is now open. Please go ahead.

Thank you. Just wanted to dot a few i's, cross a few t's on the Siding, just first of all, the $4.5 million, I assume that was in the Siding business, correct? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Correct. That's right, Mark.

Okay. And second, now you noted that Siding pricing had been up year-over-year – or SmartSide to be more precise. But it was down 3% versus the second quarter. Is that a mix thing or were there dynamics in the market where there was some give back in pricing? Curtis M. Stevens - Chief Executive Officer & Director: All mix.

All mix, okay. Curtis M. Stevens - Chief Executive Officer & Director: And then we also had – we produced some OSB in Q3 in Hayward.

Okay. And that shows up in the SmartSide price, in curiosity? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: No.

Okay. Curtis M. Stevens - Chief Executive Officer & Director: No. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: No, it's mix. Curtis M. Stevens - Chief Executive Officer & Director: It's all mix.

Sorry. And then you'd mentioned that October was pretty good. Are you starting to see favorable year-over-year comparisons volume-wise yet? And maybe asking the question a little bit differently, are we done with the de-stocking, do you think? Curtis M. Stevens - Chief Executive Officer & Director: I think so. I think we should have normal takeaways.

And so would it be fair to say we're positive in October for SmartSide volume-wise? Curtis M. Stevens - Chief Executive Officer & Director: I haven't looked at the numbers, so I can't answer that.

Okay. And then lastly, I think the sense had been that the Siding business was growing at about a 15% type rate volume-wise. And then obviously this year, we've had a pause and some of the de-stocking being a big factor. How are you thinking about the growth rate in the Siding business and obviously tying it to housing starts as we look to 2016 and even 2017? Any rules of thumb you could give us? Curtis M. Stevens - Chief Executive Officer & Director: Well, we need – I want to be in the low double digits. I would like to be in the 12% to 14% kind of growth on volume year-over-year. I can't really take the increase in housing starts because only 40% of the product is going into new construction. The rest is going to repair/remodel and these outdoor building solutions, the sheds, and then the retail piece of it.

Okay. Curtis M. Stevens - Chief Executive Officer & Director: But I think 12% to 14% should be achievable.

And there had been a thought process that maybe you've been capacity constrained at one point. Are you backing away from that perspective? And it looks like there was inventory building going on and that was... Curtis M. Stevens - Chief Executive Officer & Director: I think there was a de-stocking, but also I think when you go on allocation, to be honest with you, your sales forces isn't as aggressive as they need to be. Now that we have Swan operational, the sales force is going to be a lot more aggressive.

Okay, great. So lastly, and then I will stop beating a dead horse here but – and so do you think this is kind of a one-quarter blip and we should be back on track starting fourth quarter and beyond in Siding? Curtis M. Stevens - Chief Executive Officer & Director: I think it's probably not going to pick up the pace until Q1 when we have the Swan contributing.

Okay. Curtis M. Stevens - Chief Executive Officer & Director: Swan Valley mill contributing.

Okay. Thanks very much.

Thank you. And our next question comes from Sean Steuart of TD Securities. Your line is now open. Please go ahead.

So the conversion expenses at Swan Valley, how much more should we expect to carry into the fourth quarter, if anything? Curtis M. Stevens - Chief Executive Officer & Director: Well, when we talk about – the $4.5 million is the expenses of the people in running the facility. It didn't have anything to do with the capital, but that was in effect for about half the quarter. So my guess is the conversion expenses will be in the $6 million range to $7.5 million range in the fourth quarter.

Okay. And then, Curt, as you showed with OSB, because it is driven by U.S. housing activity, you talked about that driver. But can you speak to some of the other end markets in OSB? The renovation, commercial industrial end markets. What are you seeing there in terms of demand pull? Curtis M. Stevens - Chief Executive Officer & Director: Well, a lot of that, we can't really tell where it comes from. A lot of it does come from the retail. And if you look at our comparables for Lowe's and Home Depot year-over-year, I think they are up 2% to 3%, 2% to 4%; so not significant. And then the pro dealers, we have been going through some consolidations, as you know, with ProBuild and BFS and BMC and Stock. And so their numbers are up kind of consistent with housing, kind of 10% kind of increases.

Okay. Thanks for the context. That's all I had. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Great. Thank you.

Thank you. And our next question comes from – a follow-up question from George Staphos of Bank of America Merrill Lynch. Your line is now open. Please go ahead.

Thanks. Hi, guys. Just some housekeeping at the end; first of all, Curt, I didn't want to quadruple it, but on Millennials and their sort of recovery in terms of housing demand, I know household formation drives ultimately construction, but what's driving the household formation if again you have a specific view on this from your sources? Historically, we found that wage growth in employment has been a driver, but I can't really point to that as being a driver here. So what do you think is going on with household formation? And then my other two questions; Sallie, I think you mentioned there were some corporate initiatives in SG&A, were those large? What was behind that? And just I think you said the operating rate in OSB this year-to-date was 86%. Did I hear that correctly for you guys? Thank you. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Yes.

Yes to which one, Sallie? Curtis M. Stevens - Chief Executive Officer & Director: Yes to the operating rate. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Yes to the operating rate.

Got it. Curtis M. Stevens - Chief Executive Officer & Director: On the Millennials, we spent a lot of time talking about that, particularly at the Harvard meeting. And if you look at the Harvard Joint Center for Housing Studies, they just came out with their State of the Nation's Housing. And there was a section on the Millennials and they do think it's getting a job. You're right; it hasn't been necessarily a high-paying job, but they are getting employed. And I think there is a lot of help coming from the Baby Boom Generation and helping them make down payments to leave the household. And that's a bigger trend. We also spent a lot of time talking about student debt. And it turns out that according to Harvard, most of the student debt that is at risk of being not paid back is from a portion of the population that wouldn't buy homes anyway. So they don't think that's a big impact on the buying trend for Millennials. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: So, George, was yours a year-to-date question on operating capacity?

Yes, that's right. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Okay, sorry. That was probably about 80% in the OSB group year-to-date.

Okay. And 86% then by implication for the third quarter? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Yes, it's around there; you're right. And then in terms of the SG&A, the biggest piece of that increase really relates to sales and marketing and the people we are putting on the ground to support our Siding business.

Okay. And so the other items were insignificant in your view? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Well, I would hesitate to say – if they were insignificant, I wouldn't have mentioned them. So I think we can conclude that they were material enough to be mentioned in my comments and in our Q.

Okay. Good deal. We will discuss it offline and look at the Q as well. Thank you, guys; good luck in the quarter. Curtis M. Stevens - Chief Executive Officer & Director: Thanks. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Thanks.

Thank you. And our next question comes from Chip Dillon of Vertical Research. Your line is now open. Please go ahead.

Yes. Good morning. I had a question about the capacity situation out there as you all see it, the industry. And I don't know if either you, Sallie or Curt, could comment about. My knowledge is I think you have the Martco plant in I guess Texas, but really nothing else. But maybe you know more about how that's changed. And when is your best guess as to when the Martco plant opens in Texas? Curtis M. Stevens - Chief Executive Officer & Director: Well, as far as new mills, that's the only one that I've heard. Now there's been speculation about some further capacity additions in Europe, but in North America, I don't know of any others. There are several mills that are curtailed in the U.S., including our Chambord, Quebec mill that could come back online, but I... Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Yes. I don't think, Chip, we know any more than what we read in Panel Magazine a couple of months ago about the mill in Texas.

Okay. And then shifting gears, I guess this is more for Sallie. Could you update us as to when some of your timber transactions may unwind or when you have an option date – when you might be at a point where you might let them close or you might extend them? Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Right. Those begin being due in 2018, February of 2018. And there's no ability to extend those.

Got you. Okay. Thank you.

Thank you. And I'm showing no further questions at this time. I would now like to turn the call over to Ms. Sallie Bailey for closing remarks. Sallie B. Bailey - Chief Financial Officer & Executive Vice President: Well, great. Well, thank you, Chanel. Thank you all for participating in our call. As always, Mike and Becky are here to answer any follow-up questions you may have. We appreciate your participation and we hope everybody has a great day. Thank you. Curtis M. Stevens - Chief Executive Officer & Director: Thank you.

Ladies and gentlemen, thank you for participating in today's conference. That concludes today's program. You may all disconnect. Everyone, have a great day.