Chicago-based USG Corporation (NYSE:USG) on Tuesday reported a net loss of $40 million for the third quarter of 2008.

USG said net sales of $1.2 billion were down 7%. The results included restructuring charges totaling $5 million primarily related to manufacturing plant shutdowns and the closure of distribution locations. The results also included $3 million in startup costs for new manufacturing plants.

"Our core wallboard business continued to be affected by the sharp drop in the residential housing market and high raw material and energy costs compared to last year," said William C. Foote, USG Chairman and CEO. "The distribution business is being impacted by lower product shipments and tighter margins. The ceilings business continued year-over-year sales growth again this quarter; however, the commercial market has begun to exhibit signs of weakness."

For the first nine months of 2008, USG reported net sales of $3.6 billion and a net loss of $125 million.