23 slides from Rayonier Inc. Reit's earnings presentation, Apr 26, 2016
Slide 1: 1Q 2016 Earnings Release
1Q 2016 Earnings Release April 26, 2016 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
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: Central Idaho Timberland Sale
Central Idaho Timberland Sale
Slide 4: Central Idaho Timberland Sale: Specifics
CENTRAL IDAHO TIMBERLAND SALE: Specifics • Potlatch sold acres owned in central Idaho near McCall • 172,000 acres • Sale price: $114 million • Buyer: Southern Pine Plantations • Financial metrics: • EBITDDA: $111 million • Net cash: $121 million, including $10 million tax refund McCall • Q2 GAAP los
Slide 5: Central Idaho Timberland Sale: Valuation Metrics
CENTRAL IDAHO TIMBERLAND SALE: Valuation Metrics As indicated in the table below, our northern Idaho timberlands are considerably more productive than our central Idaho acres. This supports a significantly higher valuation for our northern Idaho timberlands. North Central As of and for the year ende
Slide 6: Central Idaho Timberland Sale: Benefits to Potlatch
CENTRAL IDAHO TIMBERLAND SALE: Benefits to Potlatch The transaction provides the funds needed to take advantage of the low public equity valuation of the company’s stock, reduce debt and increase financial flexibility. • Leverage strong demand for the asset class to sell our least strategic timberla
Slide 7: 1Q 2016 Earnings
4\ Potlatch. | 1Q 2016 Earnings www.potlatchcorp.com
Slide 8: 1Q 2016: Total Company Summary
1Q 2016: Total Company Summary (unaudited, $ in millions, except per share amounts) 2015 2016 2015 2016 Q4 Q1 Q4 Q1 Operating Income EBITDDA(1) Resource $ 16.1 $ 10.2 Northern region $ 15.6 $ 11.6 Wood Products (1.3) 1.0 Southern region 8.0 4.7 Real Estate 2.5 2.1 Total Resource 23.6 16.3 Eliminatio
Slide 9: Resource: Segment Summary
RESOURCE: Segment Summary • Harvest volumes were seasonally lower in the North and the South • Northern sawlog prices declined 6%, due to seasonally heavier logs • Southern sawlog prices were down 7%, primarily the result of a seasonal decrease in hardwood logs in the sales mix $45 50% 36% $40 37% O
Slide 10: Resource: Northern Region – Volume, Pricing and EBITDDA
RESOURCE: Northern Region – Volume, Pricing and EBITTDA Sawlog Pulpwood 900 $100 140 $50 800 120 $90 Tons (thousands) 700 $45 Tons (thousands) 100 600 $80 80 $40 $/Ton 500 $/Ton $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 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2
Slide 11: Resource: Southern Region – Volume, Pricing and EBITDDA
RESOURCE: Southern Region – Volume, Pricing and EBITTDA Sawlog Pulpwood 400 $60 400 $50 350 $50 350 $45 Tons (thousands) Tons (thousands) 300 300 250 $40 250 $40 $/Tons $/Ton 200 $30 200 150 150 $35 $20 100 100 $10 $30 50 50 0 $0 0 $25 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015
Slide 12: Wood Products: Segment Summary
WOOD PRODUCTS: Segment Summary • Average lumber prices were 3% higher in Q1 • Lumber shipments were 2% lower in Q1 • Our St. Maries, Idaho sawmill took 11 days of downtime due to log shortages in Q1 $25 25% Operating Income (millions) $20 20% 16% 14% 15% $15 $15.8 15% $14.9 10% Margin (%) $12.7 $10
Slide 13: Wood Products: Lumber Sales Prices, Shipments and EBITDDA
WOOD PRODUCTS: Lumber Sales Prices, Shipments and EBITDDA 200 176 $550 172 165 156 156 154 155 162 $500 Shipment Volumes 152 (millions of board ft) 150 $450 $402 $407 $408 $393 $386 $400 100 $351 $ / MBF $335 $324 $350 $316 50 $300 $250 0 $200 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2014 2015 2016 EBITDDA(1) ($
Slide 14: Real Estate: Segment Summary
REAL ESTATE: Segment Summary • 24% fewer acres were sold Q1, which is the seasonally weakest quarter of the year • Land basis decreased slightly in Q1 due to a lower proportion of recently acquired property with a higher basis in the sales mix $20 90% 79% 79% 75% 80% Operating Income (millions) 70%
Slide 15: Real Estate: Acres Sold, Average Price and EBITDDA
REAL ESTATE: Acres Sold, Average Price and EBITDDA 15,000 $3,000 13,499 13,083 AVG Weighted Price $2,595 12,500 $2,500 Acres Sold 10,000 7,500 $2,000 $1,726 $1,626 $1,602 $1,603 5,000 $1,445 4,140 $1,359 4,535 4,560 $1,500 $1,203 3,799 3,473 2,500 $1,070 3,022 2,153 0 $1,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 16: Financial Highlights
FINANCIAL HIGHLIGHTS FUNDS AVAILABLE FOR DISTRIBUTION(3) Amounts as of March 31, 2016: (in millions) Unaudited, $ in millions $98 $77 Cash and short-term investments $ 7.8 $56 Debt $ 627.7 $61 $52 $58 Pension & postretirement liability $ 119.0 Undrawn revolver $ 248.8 (1) Net debt to enterprise valu
Slide 17: Outlook
OUTLOOK • Harvest 850,000 tons Q2 • ≈55% of volume in the South and ≈45% in the North • Sawlogs ≈45% of Southern volume and ≈90% of Northern volume RESOURCE • Higher sawlog prices Q2 • Higher indexed prices and seasonally lighter logs in the North: price increase up to 10% • Seasonally higher mix of
Slide 18: Appendix
4\ Potlatch. | Appendix www.potlatchcorp.com
Slide 19: Statistics: Resource
STATISTICS: Resource (unaudited) 2014 2015 2016 Fee Volumes (tons) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Northern Region Sawlog 443,084 279,831 720,460 538,738 451,548 287,979 762,813 490,625 366,852 Pulpwood 60,579 30,124 62,340 48,883 47,840 31,284 69,329 46,449 52,361 Stumpage 10,968 2,475 1,862 1,007 16,90
Slide 20: Statistics: Wood Products & Real Estate
STATISTICS: Wood Products & Real Estate (unaudited) 2014 2015 2016 Wood Products Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Lumber Shipments (MBF) 155,596 176,046 171,818 156,123 154,206 152,071 155,388 164,965 161,992 Lumber Sales Prices ($ per MBF) $ 402 $ 407 $ 408 $ 393 $ 386 $ 351 $ 335 $ 316 $ 324 Real Estate
Slide 21: Total Company Earnings Summary
Total Company Earnings Summary (unaudited, $ in millions, except per share amounts) 2014 2015 2016 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Operating income: Resource $ 16.2 $ 10.8 $ 34.1 $ 23.9 $ 15.0 $ 8.8 $ 36.4 $ 16.1 $ 10.2 Wood Products 12.7 14.9 15.8 9.1 3.5 (2.0) (5.4) (1.3) 1.0 Real Estate 8.3 12.4 4.6 1
Slide 22: Non-GAAP Reconciliation: Consolidated and Operating Segment EBITDDA
NON-GAAP RECONCILIATION: Consolidated and Operating Segment EBITDDA (unaudited, $ in millions) 2014 2015 2016 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Net income $ 20.3 $ 16.3 $ 33.2 $ 20.1 $ 5.7 $ 0.7 $ 21.8 $ 3.5 $ 0.2 Income tax provision 5.5 7.9 6.2 0.1 0.3 (1.4) (2.4) (2.1) (1.1) Interest expense, net (1) 5.
Slide 23: Non-GAAP Reconciliation: Resource EBITDDA by Region and FAD
NON-GAAP RECONCILIATION: Resource EBITDDA by Region and FAD (unaudited, $ in millions) Resource EBITTDA by Region 2014 2015 2016 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Northern Resource Operating Income $ 13.0 $ 7.2 $ 26.0 $ 18.4 $ 12.7 $ 6.3 $ 28.6 $ 11.7 $ 8.6 Depreciation, depletion and amortization 3.4 2.4