18 slides from Rayonier Inc. Reit's earnings presentation, Jul 25, 2017
Slide 1: Q2 2017 Earnings Release
Q2 2017 Earnings Release July 25, 2017 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 U.S. housing s
Slide 3: Q2 2017: Total Company Summary
Q2 2017: Total Company Summary (unaudited, $ in millions, except per share amounts) 2017 2017 2016 2017 2017 2017 2016 2017 Q1 Q2 YTD YTD Q1 Q2 YTD YTD Operating Income EBITDDA(1) Resource $ 14.9 $ 19.5 $ 25.9 $ 34.4 Northern region $ 15.2 $ 19.5 $ 25.9 $ 34.7 Wood Products 8.7 24.7 5.7 33.4 Souther
Slide 4: Resource: Segment Summary
RESOURCE: Segment Summary • Northern sawlog prices increased 26% due largely to the effect of higher lumber prices on indexed sales agreements • Southern sawlog prices decreased 2% • Harvest volumes were seasonally lower due to spring break-up in Idaho $50 50% Operating Income (millions) Margin (%)
Slide 5: Resource: Northern Region – Volume, Pricing and EBITDDA
RESOURCE: Northern Region – Volume, Pricing and EBITDDA Sawlog Pulpwood 900 $120 140 $50 800 Tons (thousands) $110 120 700 $45 Tons (thousands) $100 100 600 80 $40 $/Ton $90 $/Ton 500 400 $80 60 $35 300 40 $70 200 $30 $60 20 100 0 $50 0 $25 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2015
Slide 6: Resource: Southern Region – Volume, Pricing and EBITDDA
RESOURCE: Southern Region – Volume, Pricing and EBITDDA Sawlog Pulpwood 400 $60 400 $50 350 350 $50 Tons (thousands) $45 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 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2015 2016 2
Slide 7: Wood Products: Segment Summary
WOOD PRODUCTS: Segment Summary • The segment set quarterly records for production and operating income • Average lumber prices were 11% higher in Q2 • Lumber shipments increased 13% in Q2 $30 30% Operating Income (millions) 22% $24.7 $20 20% Margin (%) 11% 9% 9% $10 10% $10.6 5% $8.3 $8.7 1% $4.7 $0
Slide 8: Wood Products: Lumber Sales Prices, Shipments and EBITDDA
WOOD PRODUCTS: Lumber Sales Prices, Shipments and EBITDDA 200 190 $500 171 175 180 168 Shipment Volumes 165 162 (thousand board ft) 155 $431 (millions of board ft) 152 150 $387 $425 $ / MBF $369 $363 $351 $351 $335 100 $316 $324 $350 50 $275 0 $200 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2015 2016 2017 (1) EBITD
Slide 9: Real Estate: Segment Summary
REAL ESTATE: Segment Summary(1) • Q2 sales were more heavily weighted to recurring sales of Minnesota rural recreational real estate than Q1 • A conservation sale with an attractive price of almost $2,600 per acre closed in Q1 $12 100% Operating Income (millions) 90% 79% 80% $9 70% 69% $8.6 70% 70%
Slide 10: Real Estate: Acres Sold, Average Price and EBITDDA
REAL ESTATE: (1) Acres Sold, Average Price and EBITDDA 14,000 $3,000 $2,595 AVG Weighted Price $2,209 10,500 $2,250 $1,800 Acres Sold $1,726 $1,602 $1,603 $1,195 $1,504 7,000 $1,339 6,565 $1,500 5,530 5,409 4,535 4,560 6,292 4,140 7,248 3,473 3,500 $750 0 $0 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2015 2016 2017
Slide 11: Financial Highlights
FINANCIAL HIGHLIGHTS Amounts as of June 30, 2017: DEBT MATURITIES (in millions) Unaudited, $ in millions $190 Cash and cash equivalents $ 110.3 Debt $ 579.2 Pension & postretirement liability $ 123.7 (1) Net debt to enterprise value 20.1% $46 $40 (2) Dividend yield 3.3% $14 $6 2017 2018 2019 2020 20
Slide 12: Q3 Outlook
Q3 OUTLOOK • Harvest 1.3 – 1.4 million tons Q3 • Slightly more than half of the total volume in the South RESOURCE • Sawlogs ≈45% of Southern volume and ≈90% of Northern volume • Estimated Q3 sawlog prices: • 5% lower in the North • 15% higher in the South • Expect to ship 190 million board feet of
Slide 13: Appendix
www.potlatchcorp.com
Slide 14: Statistics: Resource
STATISTICS: Resource (unaudited) 2015 2016 2017 Fee Volumes (tons) Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Northern Region Sawlog 287,979 762,813 490,625 366,852 388,575 579,837 474,024 354,104 333,926 Pulpwood 31,284 69,329 46,449 52,361 44,497 62,138 35,418 47,785 40,054 Stumpage 3,277 2,604 790 16,207 1,061 1
Slide 15: Statistics: Wood Products & Real Estate
STATISTICS: Wood Products & Real Estate (unaudited) 2015 2016 2017 Wood Products Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Lumber Shipments (MBF) 152,071 155,388 164,965 161,992 170,829 175,358 180,050 167,559 189,781 Lumber Sales Prices ($ per MBF) $ 351 $ 335 $ 316 $ 324 $ 351 $ 369 $ 363 $ 387 $ 431 Real Estate
Slide 16: Total Company Earnings Summary
Total Company Earnings Summary (unaudited, $ in millions, except per share amounts) 2015 2016 2017 2016 2017 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 YTD YTD Operating income: Resource $ 8.8 $ 36.4 $ 16.1 $ 10.2 $ 15.7 $ 33.3 $ 22.7 $ 14.9 $ 19.5 $ 25.9 $ 34.4 Wood Products (2.0) (5.4) (1.3) 1.0 4.7 10.6 8.3 8.7
Slide 17: Non-GAAP Reconciliation: Operating Segment EBITDDA
NON-GAAP RECONCILIATION: Operating Segment EBITDDA (unaudited, $ in millions) 2015 2016 2017 2016 2017 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 YTD YTD Northern Resource Operating Income $ 6.3 $ 28.6 $ 11.7 $ 8.6 $ 12.3 $ 26.9 $ 17.0 $ 13.4 $ 17.8 $ 20.9 $ 31.2 Depreciation, depletion and amortization 1.9 5.3 3.9
Slide 18: Non-GAAP Reconciliation: Diluted Adjusted Net Income Per Share
NON-GAAP RECONCILIATION: Diluted Adjusted Net Income Per Share (unaudited) Q2 2016 YTD 2016 (1) Amount Per share Amount Per share Adjusted Net Income As reported $ (31.3) $ (0.77) $ (31.1) $ (0.76) Central Idaho timberland sale: Loss on sale 48.5 1.19 48.5 1.19 Income tax benefit (11.8) (0.29) (11.8