Rayonier Inc. Reit · NYSE:RYN
Rayonier Inc. Reit — Rayonier — Investor Day (November 2017)
81 slides from Rayonier Inc. Reit's investor day presentation, Nov 9, 2017
Slide 1: Investor Day Presentation | November 2017
Investor Relations | August 2017 Investor Day Presentation | November 2017
Slide 2: Safe Harbor Statement
Investor Day | November 2017 Safe Harbor Statement Forward-Looking Statements - Certain statements in this presentation regarding anticipated financial outcomes including Rayonier’s earnings guidance, if any, business and market conditions, outlook, expected dividend rate, Rayonier’s business strate
Slide 3: Today's Presenters and Agenda
Investor Day | November 2017 Today’s Presenters and Agenda Rayonier Today Dave Nunes | President & Chief Executive Officer Deconstructing Timberland Returns Mark McHugh | SVP & Chief Financial Officer Timber Segments Overview Doug Long | SVP, U.S. Operations Real Estate / HBU Strategy Chris Corr | S
Slide 4: Rayonier Today
Investor Day | November 2017 Rayonier Today 3
Slide 5: Rayonier At A Glance
Investor Day | November 2017 New Zealand (37%) Real Estate (19%) Pacific Northwest (10%) U.S. South (33%) Rayonier At A Glance 4 2.7 million acres LTM ADJ. EBITDA $265MM $1.6 billion of timberlands acquired since 2011 100% certified Value-added Real Estate Platform ~325 employees Established in 1926
Slide 6: The Rayonier Roadmap to Success
Investor Day | November 2017 MISSION STATEMENT The Rayonier Roadmap to Success Our focused long-term strategy, coupled with our strong culture, will chart the path to achieving our vision. Provide industry-leading returns through intensive asset management and effective capital allocation Long-term
Slide 7: Rayonier's Strategic Priorities
Investor Day | November 2017 6 Rayonier’s Strategic Priorities MANAGE FOR LONG-TERM VALUE ACQUIRE HIGH-QUALITY TIMBERLANDS OPTIMIZE PORTFOLIO VALUE FOCUS ON QUALITY OF EARNINGS ENHANCE DISCLOSURE Design harvest strategy to achieve long-term, sustainable yield Balance biological growth, harvest c
Slide 8: Execution Against Strategy (since 2014 spin-off)
Investor Day | November 2017 7 Execution Against Strategy (since 2014 spin-off) Long range plan based on a sustainable yield harvest, with full investor visibility Demonstrated flexibility to adjust harvest levels to optimize long-term value Deferred 500,000 tons in 2016 to capitalize on stron
Slide 9: Historical Returns / Correlation by Asset Class
Investor Day | November 2017 Historical Returns / Correlation by Asset Class 8 Annualized Total Returns (1991 – Q3 2017) Timberland investment has consistently provided durable total returns with low correlation to the broader market and alternatives. Source: NCREIF, FTSE, NAREIT, Bloomberg, SNL Dat
Slide 10: Timberland Risk vs. Return
Investor Day | November 2017 Timberland Risk vs. Return 9 Timberland Exhibits Low Volatility Historically Timberland has historically achieved strong relative returns while exhibiting materially lower volatility, thus reducing portfolio risk. Source: NCREIF, FTSE, NAREIT, Bloomberg, SNL Datasource,
Slide 11: Biological Growth Drives Returns / Mitigates Risk
Investor Day | November 2017 – 10% 20% 30% 40% 50% 60% 70% – 20 40 60 80 100 120 140 160 180 200 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Stand Age PPW Tons CNS Tons Saw Tons % Grade – $5 $10 $15 $20 $25 $30 – $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 1 1 13 4 15 16 17 18 19
Slide 12: Housing Indicators Are Improving
Investor Day | November 2017 – 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 2.2 2.4 2.6 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020E Ho usi ng S ta rts (S AA R in m illi on s) Housing Starts Underlying Demand (FEA Forecast) Housing Indicators Are Improving 11 Housing Sector is Underbuilt Sourc
Slide 13: Housing Starts Poised to Move Higher, Led by Single-Family
Investor Day | November 2017 – 2.5 5.0 7.5 10.0 12.5 – 500 1,000 1,500 2,000 2,500 St arts per 1,000 of Po pulationAn nu al Hou sin g St arts (0 00 s) Single-Family Multi-Family FEA Single-Family FEA Multi-Family Starts per 1,000 of Population Housing Starts Poised to Move Higher, Led by Single-Fami
Slide 14: Housing Starts Are Key Driver of Sawtimber Pricing
Investor Day | November 2017 y = 0.0239x + 10.021 R² = 0.5816 – $10 $20 $30 $40 $50 $60 $70 $80 500 750 1,000 1,250 1,500 1,750 2,000 2,250 Housing Starts Are Key Driver of Sawtimber Pricing 13 Annual Housing Starts vs. Real Pine Sawtimber Prices U.S. South sawtimber pricing has historically trended
Slide 15: Availability of Viable B.C. Timber Is Expected to Decline Rapidly
Investor Day | November 2017 – 200 400 600 800 1,000 1,200 1,400 1,600 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Live <8 yrs 9-10 yrs 11-12 yrs >12 yrs Availability of Viable B.C. Timber Is Expected to Decline Rapidly 14 Inventory o
Slide 16: Lumber Capacity in the U.S. South Continues to Expand
Investor Day | November 2017 Lumber Capacity in the U.S. South Continues to Expand 15 Active Mill Expansion in the U.S. South Lumber production and capacity in the U.S. South is expected to grow significantly over the next five years. Source: Forisk Consulting, Rayonier Analysis, Forest Economic Adv
Slide 17: Softwood Pulpwood Demand Growth Has Been Strong
Investor Day | November 2017 Softwood Pulpwood Demand Growth Has Been Strong 16 Historical Demand for Softwood and Hardwood Fiber U.S. South growth in demand for softwood pulpwood has remained strong and is poised to accelerate on expanding OSB capacity investments. Source: Forest Economic Advisors.
Slide 18: Pulpwood Supports Composite Prices in Strong Markets
Investor Day | November 2017 Pulpwood Supports Composite Prices in Strong Markets 17 U.S. South-wide Average Stumpage Pricing As sawtimber pricing has eroded in the U.S. South, increased pulpwood pricing has offset the overall composite price decline in strong markets where Rayonier focuses its owne
Slide 19: China's Large Timber Supply Deficit Growing
Investor Day | November 2017 China’s Large Timber Supply Deficit Growing 18 China Total Timber Supply Deficit China Softwood Log and Lumber Imports Why Timber?1 Why Now?2 Why RYN?3 Source: RISI. RWE defined as roundwood equivalent. Softwood log and lumber imports to China are expected to remain stro
Slide 20: Highly Productive, Geographically Diversified Timberlands
Investor Day | November 2017 Highly Productive, Geographically Diversified Timberlands 19 317 61 92 182 13 145 67 278 722 18 382 PACIFIC NORTHWEST Acreage: 378k acres Sustainable Yield: 1.4mm tons U.S. SOUTH Acreage: 1.9mm acres Sustainable Yield: 5.9 – 6.3mm tons NEW ZEALAND Acreage: 429k acres Sus
Slide 21: Rayonier is the Leading "Pure Play" Timber REIT
Investor Day | November 2017 Rayonier is the Leading “Pure Play” Timber REIT 20 Peer Group EBITDA* Composition (2016 – 2017 YTD) Over the last two years, Rayonier has generated 73% of its EBITDA* from timber operations (versus 49% for the peer group). Note: Timberland REIT Peer Group comprised of WY
Slide 22: Timberland vs. Wood Products Volatility
Investor Day | November 2017 Timberland vs. Wood Products Volatility 21 Historical Timber vs. Wood Products Segment EBITDA* Margins (1) Timberland operations generally yield high EBITDA* margins with very low volatility relative to wood products manufacturing. (1) Based on aggregate U.S. timber segm
Slide 23: Rayonier Portfolio Highlights
Investor Day | November 2017 Rayonier Portfolio Highlights 22 Sector-Leading U.S. South EBITDA per Ton (1) Based on Rayonier estimates; assumes current portfolio with no acquisitions or divestitures. Improving Harvest Profile (1) Sector-Leading HBU Value Realizations Unique Exposure to China Export
Slide 24: Prudent Capital Structure and Financial Policy
Investor Day | November 2017 Prudent Capital Structure and Financial Policy 23 Credit Highlights & Ratio Targets Rayonier has a strong, investment grade credit profile with significant asset coverage. Current Credit Ratings S&P: BBB- / Stable Moody’s: Baa3 / Stable Credit Highlights Strong Adj
Slide 25: Nimble Approach to Capital Allocation
Investor Day | November 2017 Nimble Approach to Capital Allocation 24 Acquired ~$800 million of timberlands since spin-off Acquisitions complementary to age-class profile Improved portfolio site index and inventory stocking ~$34 million invested annually in silviculture and regeneration Ca
Slide 26: Deconstructing Timberland Returns
Investor Day | November 2017 Deconstructing Timberland Returns 25
Slide 27: U.S. South Historical Valuation Snapshot
Investor Day | November 2017 – 10x 20x 30x 40x 50x 60x – $250 $500 $750 $1,000 $1,250 $1,500 $1,750 $2,000 U.S. South Historical Valuation Snapshot 26 U.S. South EBITDA per Acre (NCREIF) U.S. South timberlands have traded at an average EBITDA multiple (excluding land sales) of ~36x over the last 25
Slide 28: Historical Components of U.S. South Timberland Returns
Investor Day | November 2017 (10.0%) (5.0%) – 5.0% 10.0% 15.0% 20.0% 25.0% 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 EBITDA Return Appreciation Return Historical Components of U.S. South Timberland Returns 2
Slide 29: U.S. South Timberland Appreciation vs. Inflation
Investor Day | November 2017 50.0 100.0 150.0 200.0 250.0 CPI NCREIF South U.S. South Timberland Appreciation vs. Inflation 28 Consumer Price Index vs. NCREIF South Appreciation – Annual % Change Timberland is generally considered a good inflation hedge – timberland values have increased in excess o
Slide 30: Components of Timberland Return – U.S. South
Investor Day | November 2017 Components of Timberland Return – U.S. South 29 Return Component Value Range Risk to Achieve Comments Cash Return Expectation EBITDA Return 2.0% – 4.5% EBITDA yield for Southern timber, including timber harvest and non-timber income (–) Capex Investment (0.5%) Average an
Slide 31: Productivity is a Key Driver of Timberland Value
Investor Day | November 2017 60 65 70 75 80 85 S it e In d e x 2 5 (f e e t) Planting Year Productivity is a Key Driver of Timberland Value Rayonier Loblolly Pine Site Index25 (feet) Higher site index properties generate greater harvest yields and a more valuable product mix. Improving site index by
Slide 32: Rayonier Historical Real Estate / HBU Summary
Investor Day | November 2017 35,906 30,026 26,251 17,173 16,346 16,417 16,340 21,310 30,923 27,519 25,292 33,129 35,680 17,839 25,011 27,385 30,967 2.2% 1.8% 1.6% 1.0% 0.9% 0.9% 0.9% 1.3% 1.6% 1.5% 1.3% 1.7% 1.9% 1.0% 1.4% 1.5% 1.6% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Q3
Slide 33: Illustrative HBU Economics Example
Investor Day | November 2017 Illustrative HBU Economics 32 Example: 1 Million Acre U.S. South Portfolio A well-designed HBU program should be able to generate roughly 0.5% to 1.0% of incremental return relative to underlying timberland returns (depending on the quality of HBU product). (1) Based on
Slide 34: Deconstructing Timberland Returns – Illustrative Acquisitions
Investor Day | November 2017 Deconstructing Timberland Returns – Illustrative Acquisitions 33 Illustrative Acquisition Scenario A – Low Productivity / Bottom Quartile Market (1) Based on TimberMart-South 2016 regional average composite stumpage price assuming mix of 50% pulpwood, 30% chip-n-saw and
Slide 35: Valuing Publicly Traded Timber REITs
Investor Day | November 2017 Valuing Publicly Traded Timber REITs Sum-of-the-parts / NAV most common approach – Per-acre value inputs should take account of relative asset quality EBITDA multiples useful only if applying the right multiple to the right EBITDA – Appropriate timber multiple should
Slide 36: Timber REIT Enterprise Value / EBITDA Multiples
Investor Day | November 2017 18.6x 25.4x 19.7x 20.0x 26.4x 30.8x 27.6x 30.8x – 10.0x 20.0x 30.0x 40.0x Rayonier Weyerhaeuser Potlatch CatchMark EBITDA excl. Manufacturing EBITDA excl. Manufacturing & Real Estate Timber REIT Enterprise Value / EBITDA Multiples 35 Enterprise Value / LTM Q3-17 EBITDA M
Slide 37: Timber Segments Overview
Investor Day | November 2017 Timber Segments Overview 36
Slide 38: Southern Timber – Portfolio Overview
Investor Day | November 2017 Southern Timber – Portfolio Overview 37 Highlights / Location Source: U.S. Dept. of Agriculture, Society of American Foresters Journal of Forestry. (1) Site index reflects the average height of the dominant and codominant trees at a base age of 25 (U.S. South). (2) Age c
Slide 39: Consumption & Inventory Changes Vary Across U.S. South
Investor Day | November 2017 Change in Consumption by Region: 2005-2014 Recession-induced demand declines have led to large drops in consumption for most areas Differences in consumption declines have caused regional market performance to vary Timberland portfolio performance will be influence
Slide 40: RYN Concentrated in Strongest U.S. South Markets
Investor Day | November 2017 – $5 $10 $15 $20 $25 FL -1 G A- 2 SC- 2 N C -2 FL -2 LA- 1 V A -2 V A -1 LA- 2 A L- 2 TX- 1 SC- 1 GA -1 TX- 2 M S -2 A L- 1 A R -1 N C -1 AR- 2 M S -1 TN- 1 TN- 2 U.S. South Average RYN Concentrated in Strongest U.S. South Markets 39 Approximately 62% of Rayonier’s South
Slide 41: Rayonier Leads the Sector In U.S. South EBITDA / Ton
Investor Day | November 2017 Rayonier Leads the Sector In U.S. South EBITDA* / Ton 40 U.S. South EBITDA* / Ton Rayonier’s sector-leading EBITDA* per Ton has increased by over 20% since 2012, while its rate of harvest has remained relatively stable. Source: WY figures pro forma for PCL combination. E
Slide 42: Productivity Gains + Mix Shift = Poised for Cash Flow Growth
Investor Day | November 2017 – 10 20 30 40 50 60 70 80 90 Productivity Gains + Mix Shift = Poised for Cash Flow Growth 41 Investment in Silviculture… As higher site index stands reach maturity, Rayonier anticipates that its harvest volume will increase and its product mix will improve. (1) Based on
Slide 43: U.S. South Exports to China and India Growing
Investor Day | November 2017 – 0.2 0.4 0.6 0.8 1.0 1.2 1.4 2012 2013 2014 2015 2016 U.S. South Exports to China and India Growing U.S. South Export Demand 42 Export Volumes by U.S. South Port Exports to China and India from the U.S. South have grown considerably, and Rayonier is well positioned to c
Slide 44: Pacific Northwest Timber – Portfolio Overview
Investor Day | November 2017 Pacific Northwest Timber – Portfolio Overview 43 Highlights / Location Source: U.S. Dept. of Agriculture, Society of American Foresters Journal of Forestry. (1) Site index reflects the average height of the dominant and codominant trees at a base age of 50 (Pacific North
Slide 45: Diverse Species and End Markets
Investor Day | November 2017 Diverse Species and End Markets 44 Pacific Northwest Inventory by Species Rayonier’s Pacific Northwest portfolio provides diversity of products and end-markets. Volume by Destination (YTD 2017) Douglas-fir 55% Hemlock 40% Other 5% Domestic 74% Export 26%
Slide 46: Pacific Northwest Demand and Pricing Have Recovered
Investor Day | November 2017 – $100 $200 $300 $400 $500 $600 $700 $800 – 2.0 4.0 6.0 8.0 10.0 12.0 14.0 West Coast Lumber Production Log Exports (Lumber Basis) Douglas-fir Log Price (Log Lines Region #1 - #2 Sawlog) Western Hemlock Log Price (Log Lines Region #1 - #2 Sawlog) Pacific Northwest Demand
Slide 47: Rayonier's Northwest EBITDA / Ton Is Improving
Investor Day | November 2017 Rayonier’s Northwest EBITDA* / Ton Is Improving 46 Northwest EBITDA* / Ton Rayonier’s Northwest EBITDA* per ton has been below the peer group due to its historical proportion of hemlock volume (vs. Doug-fir) and, more recently, due to its reduced rate of harvest. Source:
Slide 48: 2016 Portfolio Repositioning = Poised for Cash Flow Growth
Investor Day | November 2017 2016 Portfolio Repositioning = Poised for Cash Flow Growth 47 Improved Age Class Profile… Rayonier’s 2016 Pacific Northwest Portfolio Repositioning significantly improved both its near-term and long-term harvest outlook. (1) Based on Rayonier estimates; assumes current p
Slide 49: New Zealand Timber – Portfolio Overview
Investor Day | November 2017 New Zealand Timber – Portfolio Overview 48 Highlights / Location Source: NZ Ministry for Primary Industries, New Zealand Journal of Forestry. (1) Site index reflects the average height of the dominant and codominant trees at a base age of 20 (New Zealand). (2) Age class
Slide 50: Diversified Mix of Domestic & Export Markets
Investor Day | November 2017 Diversified Mix of Domestic & Export Markets 49 Volume by Market Destination (FY 2016) Over 60% of the New Zealand segment’s volume (including Trading volume) is sold into export markets, with China being the largest source of demand. RMF Domestic 37% RMF Export 30% Trad
Slide 51: Inventory Levels Drive Near-Term Price Fluctuations
Investor Day | November 2017 Inventory Levels Drive Near-Term Price Fluctuations 50 Inventory-to-Demand Ratio vs. Export Log Price Export supply / demand is generally considered in balance when the ratio of port inventory to average monthly demand is between 1.3 and 2.0 times. Inventory typically sp
Slide 52: New Zealand Log Prices Trending Upward
Investor Day | November 2017 New Zealand Log Prices Trending Upward 51 Historical New Zealand Log Prices (NZ$) Over the last 10 years, New Zealand log prices have been trending upward based primarily on growing export market demand. Source: NZ Ministry of Primary Industries. - $ 20 $ 40 $ 60 $ 80 $
Slide 53: Chinese Log and Lumber Imports Rely on NZ and Russia
Investor Day | November 2017 Chinese Log and Lumber Imports Rely on NZ and Russia 52 Chinese Log Import Volumes New Zealand has captured a significant share of the growth in China’s log import volume. Source: RISI. RWE defined as roundwood equivalent. Chinese Lumber Import Volumes (million m3 RWE) (
Slide 54: New Zealand Productivity Strong Relative to U.S.
Investor Day | November 2017 53 Plantation Tons / Acre @ Rotation Age Plantation Tons / Acre / Year Source: Rayonier estimates based on long-range harvest forecast. In addition to providing market diversification, New Zealand offers superior softwood plantation productivity relative to the U.S. New
Slide 55: Real Estate / HBU Strategy
Investor Day | November 2017 Real Estate / HBU Strategy 54
Slide 56: Rayonier Real Estate uniquely positioned to unlock value
Investor Day | November 2017 Rayonier is now executing a disciplined and focused Real Estate strategy with the experience and capabilities to create long term value. Rayonier Real Estate uniquely positioned to unlock value 55 COLLABORATIVE CULTURE FOCUSED STRATEGY EXPERIENCED TEAM DISCIPLINED EXECUT
Slide 57: Real Estate strategy: optimize value & create optionality
Investor Day | November 2017 Maximize and grow annual gross margin/ac Build diverse portfolio of cash flows Develop new business growth Real Estate strategy: optimize value & create optionality Timberlands Real Estate Sale of properties with development rights Invest in securing development
Slide 58: Making progress: price growth
Investor Day | November 2017 Making progress and just getting started: price growth 2011 – 2014 Price per Acre Rayonier has realized stronger pricing on real estate than its timber REIT peers. Excluding Large Dispositions, Rayonier’s real estate sales are heavily focused on HBU properties. Note: Pri
Slide 59: I-95 Coastal Corridor: active portfolio management
Investor Day | November 2017 I-95 Coastal Corridor: active portfolio management BRYAN COUNTY – US 17 RICHMOND HILL 1 KILKENNY RICHMOND HILL 2 EAST NASSAU NORTHERN WEST NASSAU 3 ST MARYS BLUFF’S ST MARYS / EXIT 1 GA EAST NASSAU REMAINDER EAST NASSAU SOUTHERN WEST NASSAU 1 WEST NASSAU 2 DEEP CREEK SOU
Slide 60: Overview of Wildlight Community Development
Investor Day | November 2017 261 net-acre master planned community north of Jacksonville, Florida Well positioned in a growing sub-market Initial infrastructure nearing completion Rayonier owns ~25,000 acres in a 5-mile radius Land use entitlements in place to support future growth Catal
Slide 61: Rayonier property in the path of NE Florida market growth
Investor Day | November 2017 Jacksonville MSA: 1,480,000 (2016 US Census Estimate) 60 Rayonier property in the path of NE Florida market growth
Slide 62: Wildlight progress
Investor Day | November 2017 Wildlight progress Wildlight Elementary School Rayonier office building Significant infrastructure First commercial sale Announced two homebuilders First residential sale Strategic Alliance with the University of Florida to construct health facilities Ste
Slide 63: Significant catalytic projects now complete or underway
Investor Day | November 2017 Significant catalytic projects now complete or underway New elementary school New Rayonier HQ building Highway improvements underway Future UF Health facility 62
Slide 64: Portfolio Management Strategy
Investor Day | November 2017 Portfolio Management Strategy 63
Slide 65: Creating Value Through Active Portfolio Management
Investor Day | November 2017 Creating Value Through Active Portfolio Management 64 Never satisfied with portfolio and processes – constantly monitoring, adapting and improving to create long-term value. OPPORTUNITY Leverage Expertise Focus on Right Opportunities Be Nimble Be Disciplined Team of ex
Slide 66: ~$1.6 Billion Acquired and ~$800 Million Sold Since 2011
Investor Day | November 2017 ~$1.6 Billion Acquired and ~$800 Million Sold Since 2011 65Note: Map reflects net change in ownership from 2011 to September 2017. -128 Change in Acres by Location Since January 2011 (000 Acres)
Slide 67: Success Achieved Through Flexible Deal Sourcing
Investor Day | November 2017 Success Achieved Through Flexible Deal Sourcing 66 Rayonier Value Acquired by Geography (2011 – 2017 YTD) (1) (1) Value acquired includes acquisition of 39% interest in New Zealand JV for $140 million in 2013 and acquisition of 12% interest in New Zealand JV for $56 mill
Slide 68: Focus On High-Quality Softwood Properties in Strong Markets
Investor Day | November 2017 67 Focus On High-Quality Softwood Properties in Strong Markets LOCATION ASSET QUALITY OPTIONALITY VALUE CREATION FINANCIAL PROFILE Timber end markets with favorable supply / demand tension Well-developed infrastructure, access to ports & other transportation hubs A
Slide 69: Staged Gating Process Streamlines Decision Making
Investor Day | November 2017 Staged Gating Process Streamlines Decision Making 68 Staged gating process gets company focused on right opportunities, ensures alignment, reduces due diligence expenses and provides for a transparent process to evaluate acquisitions. Gate A (1-2 days) Gate B (5-10 days)
Slide 70: Portfolio Management Valuation Framework
Investor Day | November 2017 Portfolio Management Valuation Framework 69 Rayonier employs a rigorous, multi-faceted valuation analysis in arriving at its bid / ask values for timberland acquisitions / dispositions. Cost Approach: Quickest valuation methodology Current market prices used to value
Slide 71: Key Drivers of Value – Illustrative Examples
Investor Day | November 2017 Key Drivers of Value – Illustrative Examples 70 U.S. South Example – % Change in $ per Acre by Key Value Driver Timberland value per acre is significantly impacted by productivity (site index) and stumpage prices. Other major drivers of value include age-class distributi
Slide 72: Disciplined Acquisition Process = Improved Portfolio
Investor Day | November 2017 Disciplined Acquisition Process = Improved Portfolio 71 Harvest Rate – Tons per Acre per Year (2) Rayonier seeks to acquire properties that improve quality of portfolio and produce strong recurring cash flow from sustainable harvest. Productivity – Site Index (1) Commerc
Slide 73: Case Study – Coastal Acquisitions and AL / MS Dispositions
Investor Day | November 2017 Case Study – Coastal Acquisitions and AL / MS Dispositions 72 Rayonier enhanced its Southern Timber portfolio through the disposition of 62,200 acres of predominantly pre- merchantable timber in Alabama and Mississippi in 2016 and 2017 for ~ $120 million and the subseque
Slide 74: Acquisitions Located in Strongest U.S. South Markets
Investor Day | November 2017 – $5 $10 $15 $20 $25 FL -1 G A- 2 S C -2 N C -2 FL -2 LA- 1 V A -2 V A -1 LA- 2 AL- 2 TX- 1 S C -1 G A- 1 TX- 2 M S -2 A L- 1 A R -1 N C -1 A R -2 M S -1 TN- 1 TN- 2 Acquisition Markets Disposition Markets Average Acquisitions Located in Strongest U.S. South Markets 73 T
Slide 75: Transactions Improve Age-Class Distribution and Rate of Harvest
Investor Day | November 2017 Transactions Improve Age-Class Distribution and Rate of Harvest 74 % of Plantation Acres by Age-Class (1) Capital from the Dispositions was used to partially fund the Coastal Atlantic Acquisitions, which have a more mature age-class distribution and higher rate of harves
Slide 76: Appendix
Investor Day | November 2017 Appendix 75
Slide 77: Biographies
Investor Day | November 2017 Biographies 76 David L. Nunes | President and CEO Service since: 2014 Mr. Nunes has more than three decades of forest products industry experience. He has served in key leadership positions at several timber and real estate companies, including CEO and president, and has
Slide 78: Definitions of Non-GAAP Measures and Pro Forma Items
Investor Day | November 2017 Definitions of Non-GAAP Measures and Pro Forma Items 77 Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, depletion, amortization, the non-cash cost of land and improved development, costs related to shareholder litigation, the gain on foreign
Slide 79: Reconciliation of LTM Adjusted EBITDA
Investor Day | November 2017 Reconciliation of LTM Adjusted EBITDA 78 ($ in millions) Q4 2016 Q1 2017 Q2 2017 Q3 2017 Total Net income $50.5 $35.1 $30.8 $28.8 $145.2 Interest, net 8.2 7.9 8.2 8.1 $32.4 Income tax expense 2.8 6.3 7.5 3.0 $19.6 Depreciation, depletion and amortization 31.5 30.8 37.1 2
Slide 80: Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Segment
Investor Day | November 2017 Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Segment 79 ($ in millions) Southern Timber Pacific Northwest Timber New Zealand Timber Real Estate Trading Corporate and Other Total Q3 2017 LTM Operating Income $43.2 ($4.4) $68.0 $106.6 $3.9 ($20.4) $196.9
Slide 81: Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Segment
Investor Day | November 2017 Reconciliation of Operating Income (Loss) to Adjusted EBITDA by Segment 80 ($ in millions) Southern Timber Pacific Northwest Timber New Zealand Timber Real Estate Trading Corporate and Other Total 2015 Operating Income $46.7 $6.9 $2.8 $44.3 $1.2 ($24.1) $77.8 Non-operati