21 slides from Rayonier Inc. Reit's earnings presentation, Oct 29, 2018
Slide 1: Q3 2018 Earnings
Q3 2018 Earnings October 29, 2018
Slide 2: Forward-Looking Statements & Non-GAAP Measures
Forward-Looking Statements & Non-GAAP Measures FORWARD-LOOKING STATEMENTS This presentation contains certain forward-looking statements within the meaning of the Private Litigation Reform Act of 1995 as amended, including without limitation, our expectations regarding housing demand; strong repair a
Slide 3: Key Highlights – Q3 2018
Key Highlights – Q3 2018 Financial Performance Strategy Capital Allocation (1) Adjusted EBITDDA margin of 35% Strong lumber fundamentals Closed Deltic merger on Feb 20, 2018 • Adjusted EBITDDA of $101.8 million in • Housing demand supported by • Issued 22 million shares @ $52/share Q3 2018 demograph
Slide 4: Q3 2018 Consolidated Results
Q3 2018 Consolidated Results Adjusted EBITDDA – Q2 2018 to Q3 2018 Variance ($ in millions) $15.0 $2.3 $0.2 $101.8 $94.2 ($5.0) ($4.9) Q2 2018 Resource Wood Products Real Estate Corporate Eliminations Q3 2018 Key Consolidated Highlights: Adjusted EBITDDA increased $7.6 million from Q2 2018 levels Hi
Slide 5: Q3 2018 Resource Results
Q3 2018 Resource Results Adjusted Segment EBITDDA – Q2 2018 to Q3 2018 Variance ($ in millions) $3.9 $17.3 $1.6 $1.9 $58.7 ($4.9) ($4.8) $43.7 Q2 2018 North Volume North Price/Mix South Volume South Price/Mix Log & Haul Forestry Costs & Q3 2018 Other Key Resource Highlights: Segment Adjusted EBITDDA
Slide 6: Q3 2018 Resource Results – Northern Region
Q3 2018 Resource Results Northern Region Northern Sawlog Pricing and Volume Northern Pulpwood Pricing and Volume $140 $139 700 $45 70 $42 $40 60 $120 600 Volumes: Tons (thousands) Volumes: Tons (thousands) $35 500 50 $100 500 $30 Price: $/Ton Price: $/Ton $80 400 $25 38 40 $60 300 $20 30 $15 $40 200
Slide 7: Q3 2018 Resource Results – Southern Region
Q3 2018 Resource Results Southern Region Southern Sawlog Pricing and Volume Southern Pulpwood Pricing and Volume $50 $47 600 $35 600 $31 500 $30 500 Volumes: Tons (thousands) $40 Volumes: Tons (thousands) 469 447 $25 400 400 Price: $/Ton Price: $/Ton $30 $20 300 300 $20 $15 200 200 $10 $10 100 $5 10
Slide 8: Q3 2018 Wood Products Results
Q3 2018 Wood Products Results Adjusted Segment EBITDDA – Q2 2018 to Q3 2018 Variance ($ in millions) $13.1 $3.6 $51.5 ($0.2) ($8.5) $46.5 ($12.0) ($1.0) Q2 2018 Lumber Shipments Lumber Price Residuals and Other Log Costs Lumber Costs: Panels Q3 2018 Volume Key Wood Products Highlights: Segment Adjus
Slide 9: Q3 2018 Wood Products Results
Q3 2018 Wood Products Results (1) Lumber Pricing and Shipments Wood Products Adjusted EBITDDA $550 400 $60 Shipments (thousand board feet) $486 350 $500 $50 $47 285 300 $450 Price: $/ MBF ($ in millions) 250 $40 $400 200 $30 $350 150 $20 $300 100 $250 $10 50 $200 - $0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q
Slide 10: Q3 2018 Real Estate Results
Q3 2018 Real Estate Results Adjusted Segment EBITDDA – Q2 2018 to Q3 2018 Variance ($ in millions) $12.3 $0.3 $7.4 ($4.4) ($0.5) ($0.3) Q1 2018 Rural Sales Development Sales Other, net SG&A Q2 2018 Key Real Estate Highlights: Segment Adjusted EBITDDA decreased $4.9 million from Q2 2018 levels Real E
Slide 11: Q3 2018 Real Estate Results
Q3 2018 Real Estate Results Rural - Acres Sold and Avg. Price Development – Lots Sold and Avg. Price $2,608 $143,000 $2,500 $100,000 100 13,500 Legacy Deltic 90 Average Price: $ / Acre $2,000 11,000 $80,000 80 Average Price: $ / Lot Residential Lots Sold 70 $1,500 $60,000 60 Acres Sold 8,500 50 $1,0
Slide 12: Synergies & Operational Efficiencies
Synergies & Operational Efficiencies Q3 2018 $50 Million Synergy After-Tax Annual Cash Synergies Goal $50 Million Run Rate Target Synergy ($ millions) Achieved On-Track $15 $50 $51 $50 Sustainable Harvest $ 11 Successful harvest ramp-up $40 Expand Lumber Output $ 16 $7 Waldo kiln conversion complete
Slide 13: Favorable Capital Structure
Favorable Capital Structure Debt Maturities ($ in millions) $200 $190 Potlatch Deltic $176 $150 $100 $100 $100 $46 $40 $43 $40 $50 $28 $29 $- $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 PotlatchDeltic Unaudited, $ in millions September 30, 2018 Key Highlights: (1) Market capitalization
Slide 14: Q4 2018 Outlook
Q4 2018 Outlook Harvest volume 1.3 - 1.5 million tons Geographic harvest ~ 70% of volume in South Sawlog mix North: sawlogs ~ 90% of volume RESOURCE South: sawlogs ~ 50% of volume Sawlog pricing North: lumber indexed South: less hardwood in mix Lumber shipments 260 - 280 million board feet WOOD PROD
Slide 15: Appendix
4\PotlatchDeltic Q3 2018 Earnings
Slide 16: Total Company Summary
Total Company Summary 2017 2018 Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Total Operating income: Resource $ 14.9 $ 19.6 $ 41.8 $ 29.9 $ 106.2 $ 29.0 $ 29.1 $ 46.0 $ 104.1 Wood Products(1) 9.0 24.9 19.5 19.7 73.1 25.6 45.5 40.6 111.7 Real Estate 8.7 5.7 1.4 2.8 18.6 4.3 9.3 3.1 16.7 Eliminations 1.1 1.0 (3.1) (1.7
Slide 17: Non-GAAP Reconciliation: Operating Segment Adjusted EBITDDA
Non-GAAP Reconciliation: Operating Segment Adjusted EBITDDA 2017 2018 Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Total Resource Northern Operating Income $ 13.4 $ 17.8 $ 36.8 $ 26.0 $ 94.0 $ 26.2 $ 26.0 $ 39.6 $ 91.8 Depreciation, depletion and amortization 1.8 1.7 2.2 2.2 7.9 2.1 1.9 2.3 6.3 Northern Adjusted EBIT
Slide 18: Statistics: Resource and Wood Products
Statistics: Resource and Wood Products (unaudited) 2017 2018 Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Total Resource Fee Volumes (tons) Northern Region Sawlog 354,104 333,926 559,580 463,978 1,711,588 448,782 377,636 500,138 1,326,556 Pulpwood 47,785 40,054 33,742 24,821 146,402 45,428 31,389 37,953 114,770 Stump
Slide 19: Statistics: Real Estate (unaudited)
Statistics: Real Estate (unaudited) 2017 2018 Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Total Real Estate Rural Acres Sold HBU Development 4,628 700 628 484 6,440 1,796 1,133 1,136 4,065 Rural Real Estate 1,740 4,523 1,207 2,523 9,993 3,461 2,280 2,024 7,765 Non-Strategic Timberlands 197 186 191 — 574 887 8,158 —
Slide 20: Definitions
Definitions Adjusted EBITDDA is a non-GAAP measure and is calculated as net income (loss) adjusted for interest expense, provision (benefit) for income taxes, depletion, depreciation and amortization, basis of real estate sold, non-operating pension and other post-retirement benefit costs, gains and
Slide 21: Michael J. Covey, Eric J. Cremers, Jerald W. Richards
Michael J. Covey Chairman and Chief Executive Officer Eric J. Cremers President and Chief Operating Officer Jerald W. Richards Vice President and Chief Financial Officer PotlatchDeltic (NASDAQ: PCH) www.PotlatchDeltic.com