THE CANADIAN PRESS

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TORONTO - Norbord Inc. (TSX: NBD) narrowed its losses in the third quarter due to cost controls but its revenues fell 25 per cent and missed analyst estimates as sluggish home sales continued to plague the wood panel manufacturer.

Its net loss was US$7 million or 16 cents per share in the quarter ended Sept. 26, up from a year-ago loss of US$18 million or $1.21 per share, the Toronto-based company announced Friday.

Norbord, which keeps its books in U.S. dollars, posted quarterly revenues of $192 million, down from $256 million last year.

Analysts estimates compiled by Thomson Reuters, which usually exclude unusual items and the impact of currency fluctuation, had estimated a loss of 17 cents per share and revenue of $196 million.

Formerly part of the Noranda forestry business, Norbord one of the world's largest producers of oriented-strand board and also makes particleboard, medium density fibreboard, plywood and other products.

The company's customers are the housing, construction and furniture industries, sectors that have all been squeezed by the housing slump.

Norbord attributed the improvement in its results to a reduction in operating costs and an improved product mix, as well as a seasonal increase in North American OSB wood panel prices.

The company also said it benefited from the home renovation tax credit in North America, and a rise in the "do it yourself" segment in the U.K.

However, Norbord warned that high unemployment and restrictions on credit availability for first-time home buyers in the United States and United Kingdom would continue to impact housing and panel demand.

"We expect it will take six to 12 months for these trends to reverse and meaningful improvement to occur in new home construction," said Barrie Shineton, Norbord's president and chief executive officer in a statement.

"On a more positive note, we believe housing demand has finally reached the bottom."

Shineton said the company maintained its view that the current low level of housing activity is unsustainable and eventual recovery is "a certainty."

He added that when the recovery hits full swing, the company would be well positioned to capitalize on it.

Norbord shares closed at $15.19 Thursday on the Toronto Stock Exchange.