Weyerhaeuser Company · NYSE:WY
Weyerhaeuser — Q3 2010 Earnings Presentation
20 slides from Weyerhaeuser's earnings presentation, Oct 29, 2010
Slide 1: Earnings Release – 3rd Quarter 2010
WEYERHAEUSER Earnings Release – 3rd Quarter 2010
Slide 2: Forward-looking Statement
Forward-looking Statement This presentation contains statements concerning the company’s future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on various assumptions and may not be acc
Slide 3: Statements Relating to Non-GAAP Financial Measures
Statements Relating to Non-GAAP Financial Measures During the course of this presentation, certain non-U.S. GAAP financial information will be presented. A reconciliation of those numbers to U.S. GAAP financial measures is included in this presentation which is available on the company’s website a
Slide 4: 2010 Q3 Consolidated Results
Chart 1 2010 Q3 Consolidated Results 2010 Q3 $ Millions except EPS 2010 2010 Revenues ($ Millions) $1,664 Contribution to Pre-Tax Earnings Q2 Q3 Before Special Items Net Earnings $81 Timberlands $70 $75 Before Special Items ($ Millions)1. Diluted Earnings Per Share Wood Products (11) (100) $0.25 Bef
Slide 5: Diluted EPS Before Special Items
Chart 2 Diluted EPS Before Special Items A reconciliation to GAAP EPS is available on Chart 16 and at www.weyerhaeuser.com $0.80 $0.60 $0.40 $0.25 $0.20 $0.20 $0.00 -$0.07 -$0.20 -$0.26 -$0.40 -$0.60 -$0.59 -$0.52 -$0.68 -$0.80 -$1.00 -$1.20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2009 2010 1. Weyerhaeuser’s share cou
Slide 6: Reconciliation to GAAP
Chart 3 Reconciliation to GAAP $ Millions except EPS Diluted EPS Net Earnings 2010 2010 2010 2010 Q2 Q3 Q2 Q3 Diluted EPS / Net Earnings Before Special Items $0.20 $0.25 $42 $81 Income Tax Adjustments $3.25 $1,035 Loss on Early Extinguishment of Debt (0.16) (33) Wood Products Asset Sales 0.03 5 Dilu
Slide 7: Changes in Contribution to Earnings by Segment
Chart 4 Changes in Contribution to Earnings by Segment Earnings Before Special Items, Interest and Taxes ($ millions)1. $250 107 186 $200 5 2 168 (7) $150 $100 (89) $50 $0 -$50 -$100 2010 Q2 Timberlands Wood Products Cellulose Fibers Real Estate Corp & Other 2010 Q3 1. A reconciliation before Specia
Slide 8: Timberlands Segment
Chart 5 Timberlands Segment Timberlands ($ Millions) 2010 Q2 2010 Q3 3rd Quarter Notes Lower log price realizations, primarily in the west Third Party Revenues1. $225 $237 Seasonally higher road and silviculture expenses Inter-Segment Revenues1. $101 $103 Harvest deferrals continue 3rd quart
Slide 9: Fee Harvest and 3rd-Party Log Realizations
Fee Harvest and 3rd-Party Log Realizations — Chart 6 Western / Southern Timberlands Fee Harvest Volume Average 3rd-Party Realizations — Logs 3000 120 110 98 2600 2495 100 91 2380 West ($/m3) 2258 South (m3) 90 84 79 2140 75 2200 2060 80 73 (Thousands) 68 ($/m3) 1863 1881 70 1800 1910 60 1678 50 43 4
Slide 10: Wood Products Segment
Chart 7 Wood Products Segment 3rd Quarter Notes Wood Products ($ Millions) 2010 Q2 2010 Q3 Weak market conditions persisted Revenues $789 $626 Significant decline in average sales realizations for lumber and OSB Contribution to Pre-Tax Earnings ($3) ($100) Lower sales volumes for engineered wo
Slide 11: Average 3rd-Party Realizations — OSB, Lumber, Engineered Lumber
Average 3rd-Party Realizations — Chart 8 OSB and Lumber / Engineered Lumber OSB and Lumber Engineered Lumber 500 2400 450 2200 400 Solid Section ($/CCF) 2000 348 1844 350 1817 1771 1780 Lumber ($/MBF) 317 1754 ($/Thousand) 1750 1800 1715 ($/Unit) 287 300 271 267 241 244 1600 250 266 OSB ($/M 3/8‖) 1
Slide 12: Cellulose Fibers Segment
Chart 9 Cellulose Fibers Segment 3rd Quarter Notes Cellulose Fibers ($ Millions) 2010 Q2 2010 Q3 Higher average price realizations Revenues $468 $522 Lower maintenance costs due to no annual maintenance outages in the 3rd quarter, Contribution to Pre-Tax Earnings compared with three in the 2nd q
Slide 13: Real Estate Segment
Chart 10 Real Estate Segment 3rd Quarter Notes Real Estate ($ Millions) 2010 Q2 2010 Q3 Fewer home sale closings Revenues $257 $210 Improved margins on homes closed due to mix Contribution to Pre-Tax Earnings 3rd quarter includes partnership income of $7 million $27 $20 and gains of $4 million
Slide 14: 2010 Q4 Outlook
Chart 11 2010 Q4 Outlook Segment Comments Expect lower log price realizations, primarily in the west, and seasonally lower harvest volumes Anticipate increased silviculture costs, primarily in the south Timberlands Excluding the disposition of non-strategic timberlands, Weyerhaeuser expects 20
Slide 15: Reconciliation of Changes in Share Count
Chart 12 Reconciliation of Changes in Share Count On Sept. 1, 2010, Weyerhaeuser paid a previously announced special dividend consisting of approximately 324 million shares of common stock and $560 million in cash. All numbers are approximate due to rounding. Explanation of 2010 Q3 Ending Share
Slide 16: Pro Forma Earnings Per Share
Chart 13 Pro Forma Earnings Per Share After payment of the Special Dividend, Weyerhaeuser had approximately 536 million shares outstanding, or 537 million shares on a diluted basis. The following table sets forth a pro forma EPS as if Special Dividend shares had been outstanding. Weyerhaeuser
Slide 17: Effective Tax Rate
Chart 14 Effective Tax Rate As a result of converting to a Real Estate Investment Trust (REIT), Weyerhaeuser’s 2010 effective income tax rate decreased due to lower taxes on REIT income. The company’s effective YTD tax rate as of 2010 Q3 was 18.5%. The income tax benefit for 2010 Q3 included t
Slide 18: Appendix
Appendix 07/29/2010 • 18
Slide 19: Earnings Summary
Earnings Summary Chart 15 $ Millions except EPS 2009 2010 Contribution to Earnings before Special Items Q1 Q2 Q3 Q4 Q1 Q2 Q3 Timberlands $40 $71 $58 $28 $81 $70 $75 Wood Products (176) (147) (92) (123) (63) (11) (100) Cellulose Fibers 32 (7) 44 34 19 74 181 Real Estate (24) 2 (9) 11 31 27 20 Corpora
Slide 20: Earnings per Share Reconciliation
Chart 16 Earnings per Share Reconciliation 2009 2010 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Diluted EPS before Special Items ($0.68) ($0.59) ($0.26) ($0.52) ($0.07) $0.20 $0.25 One-time Tax Adjustments / Tax Law Changes (0.10) (0.15) $3.25 Gain (Loss) on Early Extinguishment of Debt (0.09) (0.16) Net Gain on Divestit