18 slides from Rayonier Inc. Reit's earnings presentation, Oct 21, 2016
Slide 1: Q3 2016 Earnings Release
Q3 2016 Earnings Release October 21, 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: Q3 2016: Total Company Summary
Q3 2016: Total Company Summary (unaudited, $ in millions, except per share amounts) 2016 2016 2015 2016 2016 2016 2015 2016 Q2 Q3 YTD YTD Q2 Q3 YTD YTD Operating Income EBITDDA(1) Resource $ 15.7 $ 33.3 $ 60.2 $ 59.2 Wood Products 4.7 10.6 (3.9) 16.3 Northern region $ 14.3 $ 29.4 $ 58.5 $ 55.3 Real
Slide 4: Resource: Segment Summary
RESOURCE: Segment Summary • Unseasonably wet conditions resulted in lower than planned harvest volumes in the South • Northern sawlog prices increased 13% due to seasonally lighter logs and higher cedar log prices • Southern sawlog prices increased 14%, primarily the result of a seasonal increase in
Slide 5: Northern Region – Volume, Pricing and EBITDDA
RESOURCE: Northern Region – Volume, Pricing and EBITDDA Sawlog Pulpwood 900 $110 140 $50 800 $100 120 700 $45 Tons (thousands) Tons (thousands) 600 $90 100 $40 $/Ton 500 80 $/Ton $80 400 60 $35 300 $70 40 200 $30 $60 20 100 0 $50 0 $25 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015
Slide 6: Southern Region – Volume, Pricing and EBITDDA
RESOURCE: Southern Region – Volume, Pricing and EBITDDA Sawlog Pulpwood 400 $60 400 $50 350 350 $50 $45 Tons (thousands) Tons (thousands) 300 300 $40 250 250 $40 $/Ton $/Ton 200 $30 200 150 150 $35 $20 100 100 $10 $30 50 50 0 $0 0 $25 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2
Slide 7: Wood Products: Segment Summary
WOOD PRODUCTS: Segment Summary • Earnings have increased four quarters in a row and Q3 is the highest quarterly earnings in two years • Average lumber prices were 5% higher in Q3 • Lumber shipments increased 3% in Q3 $25 25% Operating Income (millions) $20 20% 16% $15 $15.8 15% 11% Margin (%) 10% $1
Slide 8: Wood Products: Lumber Sales Prices, Shipments and EBITDDA
WOOD PRODUCTS: Lumber Sales Prices, Shipments and EBITDDA 200 $550 172 165 171 175 156 155 162 $500 Shipment Volumes 154 152 (millions of board ft) 150 $450 $408 $393 $386 $369 $400 $ / MBF 100 $351 $335 $351 $316 $324 $350 50 $300 $250 0 $200 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 2016 (1) EBITDDA ($
Slide 9: Real Estate: Segment Summary
REAL ESTATE: Segment Summary • A conservation sale with an attractive price of almost $2,600 closed in Q2 • Approximately 90% of Q3 sales were rural real estate, which have a lower land basis and lower average selling prices $12 100% 90% 79% Operating Income (millions) 75% 80% $9 70% 70% $8.5 Margin
Slide 10: Real Estate: Acres Sold, Average Price and EBITDDA
REAL ESTATE: (1) Acres Sold, Average Price and EBITDDA 14,000 $3,000 AVG Weighted Price $2,595 Acres Sold 10,500 $2,250 $1,726 $1,800 $1,626 $1,602 $1,603 $1,359 $1,445 $1,339] 7,000 5,530 $1,500 4,140 4,535 4,560 6,292 3,799 3,473 3,500 3,022 $750 2,153 0 $0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2014 2015 201
Slide 11: Financial Highlights
FINANCIAL HIGHLIGHTS DEBT MATURITIES FOR THE NEXT FIVE YEARS Amounts as of September, 2016: (in millions) Unaudited, $ in millions $190 Cash and short-term investments $ 72.9 Debt $ 585.4 Pension & postretirement liability $ 118.7 Fo Undrawn revolver $ 248.8 $46 Net debt to enterprise value(1) 24.5%
Slide 12: Q4 Outlook
Q4 OUTLOOK • Harvest 1.0 to 1.1 million tons • ≈50% of volume in the South and ≈50% in the North • Sawlogs ≈90% of Northern volume and ≈45% of Southern Volume RESOURCE • Lower sawlog prices • Seasonally heavier logs and lighter mix of cedar sawlogs in the North: price decline up to 15% • Seasonally
Slide 13: Appendix
www.potlatchcorp.com
Slide 14: Statistics: Resource
STATISTICS: Resource (unaudited) 2014 2015 2016 Fee Volumes (tons) Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Northern Region Sawlog 720,460 538,738 451,548 287,979 762,813 490,625 366,852 388,575 579,837 Pulpwood 62,340 48,883 47,840 31,284 69,329 46,449 52,361 44,497 62,138 Stumpage 1,862 1,007 16,903 3,277 2,604
Slide 15: Statistics: Wood Products & Real Estate
STATISTICS: Wood Products & Real Estate (unaudited) 2014 2015 2016 Wood Products Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Lumber Shipments (MBF) 171,818 156,123 154,206 152,071 155,388 164,965 161,992 170,829 175,358 Lumber Sales Prices ($ per MBF) $ 408 $ 393 $ 386 $ 351 $ 335 $ 316 $ 324 $ 351 $ 369 Real Estate
Slide 16: Total Company Earnings Summary
Total Company Earnings Summary (unaudited, $ in millions, except per share amounts) 2014 2015 2016 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD Operating income: Resource $ 34.1 $ 23.9 $ 15.0 $ 8.8 $ 36.4 $ 16.1 $ 10.2 $ 15.7 $ 33.3 $ 60.2 $ 59.2 Wood Products 15.8 9.1 3.5 (2.0) (5.4) (1.3) 1.0 4.7
Slide 17: Non-GAAP Reconciliation: Operating Segment EBITDDA
NON-GAAP RECONCILIATION: Operating Segment EBITDDA (unaudited, $ in millions) 2014 2015 2016 2015 2016 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 YTD YTD Northern Resource Operating Income $ 26.0 $ 18.4 $ 12.7 $ 6.3 $ 28.6 $ 11.7 $ 8.6 $ 12.3 $ 26.9 $ 47.6 $ 47.8 Depreciation, depletion and amortization 5.4 3.9 3.7
Slide 18: Non-GAAP Reconciliation: Diluted Adjusted Net Income Per Share
NON-GAAP RECONCILIATION: Diluted Adjusted Net Income Per Share (unaudited) Adjusted Net Income(1) Q2 2016 YTD 2016 Amount Per share Amount Per share As reported $ (31.3) $ (0.77) $ (3.4) $ (0.08) Central Idaho timberland sale: Loss on sale 48.5 1.19 48.5 1.19 Income tax benefit (11.8) (0.29) (11.8)