19 slides from Rayonier Inc. Reit's earnings presentation, Oct 27, 2015
Slide 1: 3Q 2015 Earnings Release
Michael J. Covey Chairman and Chief Executive Officer 3Q 2015 Earnings Release Eric J. Cremers President and Chief Operating Officer Potlatch Corporation Jerald W. Richards Vice President and Chief Financial Officer October 27, 2015
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, statements about our expectations regarding the company’s
Slide 3: 3Q 2015: Total Company Summary
3Q 2015: Total Company Summary (unaudited, $ in millions, except per share amounts) Unaudited, $ in millions 2014 2015 2014 2015 Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD Operating income Resource $ 16.2 $ 10.8 $ 34.1 $ 23.9 $ 15.0 $ 8.8 $ 36.4 $ 61.1 $ 60.2 Wood Products 12.7 14.9 15.8 9.1 3.5 (2.0) (5.4) 43.4
Slide 4: Resource: Segment Summary
RESOURCE: Segment Summary Harvest volumes were seasonally higher in the North and the South Northern sawlog prices increased modestly, due largely to strong cedar log prices Southern sawlog prices were up 15%, primarily the result of a seasonal increase in hardwood logs in the mix $40 45% 37%
Slide 5: Resource: Northern Region – Volume and Pricing
RESOURCE: Northern Region – Volume and Pricing Sawlog Pulpwood 900 $100 140 $50 800 120 $90 $45 700 100 Tons (thousands) Tons (thousands) 600 $80 $40 $ / Ton $ / Ton 500 80 $70 400 60 $35 300 $60 40 200 $30 $50 20 100 0 $40 0 $25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
Slide 6: Resource: Southern Region – Volume and Pricing
RESOURCE: Southern Region – Volume and Pricing Sawlog Pulpwood 400 $60 400 $50 350 350 $55 $45 300 300 Tons (thousands) Tons (thousands) 250 250 $50 $40 $ / Ton $ / Ton 200 200 $45 $35 150 150 100 100 $40 $30 50 50 0 $35 0 $25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2
Slide 7: Wood Products: Segment Summary
WOOD PRODUCTS: Segment Summary Average lumber prices were 5% lower in Q3 Lumber shipments increased slightly in Q3 The last two major 2015 capital projects were completed in Q3 $25 25% 21% 21% $20 $18.9 20% $19.7 Operating Income (millions) 16% 15% $15 14% 15% $15.8 Margin (%) 12% 10% $14.9 10
Slide 8: Wood Products: Lumber – Sales Prices and Shipments
WOOD PRODUCTS: Lumber – Sales Prices and Shipments 200 $550 173 176 172 163 $500 156 156 155 Shipment Volumes (millions of board ft) 153 152 154 152 150 $450 $423 $412 $408 $402 $407 $393 $ / MBF $386 $400 $374 100 $363 $351 $335 $350 $300 50 $250 0 $200 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2013 2014
Slide 9: Real Estate: Segment Summary
REAL ESTATE: Segment Summary The Minnesota rural recreational real estate market remained strong Two commercial real estate sites were sold in Q2; comparable transactions did not occur in Q3 $20 90% 79% 79% 73% 75% 80% 71% Operating Income (millions) 67% 67% 70% $15 57% $12.4 54% 60% Margin (%)
Slide 10: Financial Highlights
FINANCIAL HIGHLIGHTS Amounts as of September 30, 2015: Unaudited, $ in millions Funds Available for Distribution(3) (millions) $150 Cash and short-term investments $ 1.3 Long-term debt $ 630.2 $100 $98 Pension & other postretirement liability $ 114.5 $77 Undrawn revolver $ 248.6 $53 $50 $52 $58 $54
Slide 11: Outlook
OUTLOOK Harvest 1.1 – 1.2 million tons Q4 Slightly more than half of the volume in the South Sawlogs ≈45% of Southern volume and ≈90% of Northern volume RESOURCE Lower sawlog prices Lower lumber prices and seasonally wetter logs in the North Seasonally lower mix of hardwood in the South
Slide 12: Appendix
Appendix
Slide 13: Statistics: Resource
STATISTICS: Resource (unaudited) 2014 2015 2014 2015 Fee Volumes (tons) Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD Northern Region Sawlog 443,084 279,831 720,460 538,738 451,548 287,979 762,813 1,443,375 1,502,340 Pulpwood 60,579 30,124 62,340 48,883 47,840 31,284 69,329 153,043 148,453 Stumpage 10,968 2,475 1,86
Slide 14: Statistics: Wood Products & Real Estate
STATISTICS: Wood Products & Real Estate (unaudited) 2014 2015 2014 2015 Wood Products Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD Lumber Shipments (MBF) 155,596 176,046 171,818 156,123 154,206 152,071 155,388 503,460 461,665 Lumber Sales Prices ($ per MBF) $ 402 $ 407 $ 408 $ 393 $ 386 $ 351 $ 335 $ 404 $ 357 Real
Slide 15: EBITDDA Reconciliation
EBITDDA RECONCILIATION (unaudited, $ in millions) 2014 2015 2014 2015 Unaudited, $ in millions Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD GAAP net income $ 20.3 $ 16.3 $ 33.2 $ 20.1 $ 5.7 $ 0.7 $ 21.8 $ 69.8 $ 28.2 Interest expense, net (1) 5.5 5.5 5.5 6.4 8.1 8.0 8.3 16.5 24.4 Income tax provision 5.5 7.9 6.2 0.
Slide 16: EBITDDA Reconciliation: By Segment
EBITDDA RECONCILIATION: By Segment (unaudited, $ in millions) 2014 2015 2014 2015 Unaudited, $ in millions Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD Resource Operating Income $ 16.2 $ 10.8 $ 34.1 $ 23.9 $ 15.0 $ 8.8 $ 36.4 $ 61.1 $ 60.2 Depreciation, depletion and amortization 3.9 2.8 6.0 5.1 6.2 4.8 10.3 12.7 2
Slide 17: FAD Reconciliation
FAD RECONCILIATION (unaudited, $ in millions) 2014 2015 2014 2015 Unaudited, $ in millions Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD GAAP net income $ 20.3 $ 16.3 $ 33.2 $ 20.1 $ 5.7 $ 0.7 $ 21.8 $ 69.8 $ 28.2 Depreciation, depletion & amortization(1) 6.1 4.9 8.3 7.4 8.5 7.1 12.6 19.3 28.2 Basis of real estate s
Slide 18: Operating Working Capital Reconciliation
OPERATING WORKING CAPITAL RECONCILIATION (unaudited, $ in millions) 2014 2015 Unaudited, $ in millions Q1 Q2 Q3 Q4 Q1 Q2 Q3 Current assets $ 139.1 $ 145.1 $ 144.1 $ 93.7 $ 89.3 $ 90.3 $ 94.3 Less: Current liabilities (49.5) (54.9) (60.0) (72.2) (81.5) (104.0) (93.7) Working capital 89.6 90.2 84.1 21
Slide 19: Slide 19