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Weyerhaeuser Reports Second Quarter Net Earnings of $157 Million; Achieves Synergy Goal from Willamette Acquisition

PRNewswire
FEDERAL WAY, Wash.
Jul 25, 2003

Weyerhaeuser Company (NYSE: WY) today reported second quarter net earnings of $157 million, or 71 cents per share, on net sales of $4.9 billion. This compares with $72 million, or 32 cents per share, on net sales of $4.9 billion for the second quarter of 2002.

  Second quarter 2003 earnings include the following after-tax items:

  -- A charge of $19 million, or 8 cents per share, for closure or impending
     sale of facilities;
  -- A charge of $17 million, or 8 cents per share, for integration and
     restructuring activities;
  -- A gain of $95 million, or 43 cents per share, for the sale of
     timberlands in Western Washington;
  -- A gain of $7 million, or 3 cents per share, for the settlement of an
     insurance claim relating to the company's Cemwood litigation.

  Second quarter 2002 earnings include the following after-tax items:

  -- A charge of $18 million, or 8 cents per share, for closure or impending
     closure of facilities;
  -- A charge of $17 million, or 8 cents per share, for integration and
     restructuring activities;
  -- A gain of $19 million, or 9 cents per share, for the reversal of a
     countervailing duty accrual.

The company also announced that it has achieved its annualized run rate goal of $300 million in pre-tax synergies related to the acquisition of Willamette Industries. Weyerhaeuser originally estimated it would reach this synergy goal by first quarter 2005.

  Other significant second quarter financial matters include:

  -- Reduced total company debt, which includes Real Estate and related
     operations, to approximately $13.6 billion at the end of the quarter.
     This is a reduction of approximately $334 million from the prior
     quarter.
  -- Maintained capital spending discipline. Capital spending, excluding
     acquisitions and Real Estate and related operations, for the first six
     months was approximately $319 million, in line with the annual goal of
     $750 million.
  -- Incurred approximately $26 million in countervailing and anti-dumping
     duties and related costs in the second quarter on Canadian softwood
     lumber the company imports into the United States compared with the
     $24 million Weyerhaeuser incurred in the first quarter.

"Our ability to achieve our synergy goal more than one year ahead of schedule, despite challenging market conditions, is a tribute to our employees," said Steven R. Rogel, chairman, president and chief executive officer. "They have embraced the concept of increased frugality and have made substantial progress in improving the overall efficiency of our manufacturing systems. Through their hard work, we are positioned to take advantage of future improvements in the economy.

"Late in the second quarter we saw some promising signs in the prices for wood products, a trend that should continue into the third quarter," Rogel said. "Unfortunately, the markets for pulp, uncoated free sheet and containerboard are expected to remain challenging."

   SUMMARY OF SECOND QUARTER FINANCIAL HIGHLIGHTS

   Millions (except per share data)    2Q 2003      2Q 2002        Change
     Net earnings                         $157          $72           $85
     Earnings per share                  $0.71        $0.32         $0.39
     Net sales                          $4,930       $4,922            $8

   SEGMENT RESULTS FOR SECOND QUARTER 2003
   (Contributions to Pre-Tax Earnings)

   Millions                            2Q 2003      2Q 2002        Change
     Timberlands                          $300         $162          $138
     Wood Products                        ($53)         $64         ($117)
     Pulp and Paper                        ($7)        ($15)           $8
     Containerboard, Packaging
      and Recycling                       $108          $75           $33
     Real estate and related assets        $91          $79           $12

   TIMBERLANDS
                                       2Q 2003      1Q 2003        Change
   Contribution to earnings (millions)    $300         $149          $151

Excluding a pre-tax gain of $144 million from the sale of timberlands in Western Washington to Hancock Timber Resources, second quarter earnings were up slightly from the first quarter due to increased log sales volumes in the West in both export and domestic markets on somewhat lower prices. In the South, slightly higher prices partially offset lower harvest volumes due to weather conditions.

Third quarter harvest results are expected to be lower than second quarter due to normal reductions in harvest levels during the fire season, which is expected to result in slightly lower earnings in the segment.

   WOOD PRODUCTS
                                       2Q 2003      1Q 2003        Change
   Contribution (charge)
    to earnings (millions)                ($53)       ($150)          $97

Excluding a $79 million pre-tax first quarter charge taken for damages awarded by a jury on April 18 in U.S. District Court in Oregon, operating losses in the second quarter were lower than first quarter. The improvement was due to significantly stronger prices late in the quarter for oriented strand board and plywood. Market conditions for structural softwood lumber also improved late in the quarter, leading to stronger prices and higher sales volumes. The improvements were offset by higher costs in the company's Canadian operations associated with the strengthening Canadian dollar. Wood Products recognized pre-tax charges of $24 million in the first quarter and $29 million in the second quarter for integration and restructuring, and closure or impending sale of facilities.

Third quarter results for Wood Products are expected to be better than second quarter due primarily to the continued strength in the wood products markets. Weyerhaeuser will continue to be adversely affected by countervailing and anti-dumping duties, and related costs on Canadian softwood lumber the company imports into the United States.

   PULP AND PAPER
                                       2Q 2003      1Q 2003        Change
   Contribution (charge)
    to earnings (millions)                 ($7)         $10          ($17)

Pulp prices benefited from the weaker U.S. dollar, but the benefits from this increase were more than offset by a decrease in fine paper prices. Weyerhaeuser took approximately 60,000 tons of combined market and annual maintenance downtime during the second quarter. Costs associated with the downtime and higher costs in the company's Canadian operations associated with the strengthening Canadian dollar negatively affected the second quarter performance. In addition, the second quarter earnings include charges of approximately $10 million for an impending facility closure and costs associated with work force reductions. First quarter earnings included integration and restructuring costs of $6 million.

Third quarter earnings are expected to be lower than second quarter due to weak demand for pulp and fine paper.

   CONTAINERBOARD, PACKAGING AND RECYCLING
                                       2Q 2003      1Q 2003        Change
   Contribution to earnings (millions)    $108          $80           $28

A seasonal increase in the demand for packaging resulted in higher second quarter earnings compared with first quarter results. This increase was partially offset by lower prices for corrugated boxes and higher costs for old corrugated containers, commonly referred to as OCC. During the quarter, Weyerhaeuser took 70,000 tons of market and maintenance downtime.

Third quarter earnings are expected to be lower than second quarter due to continued weak markets.

   REAL ESTATE AND RELATED ASSETS
                                       2Q 2003      1Q 2003        Change
   Contribution to earnings (millions)     $91          $95           ($4)

The business benefited from the continued strong housing market and a $12 million pre-tax gain on a commercial property sale in Southern California in the second quarter. First quarter earnings included a pre-tax gain of $18 million for the sale of an apartment complex and two office buildings.

Third quarter earnings are expected to be higher than second quarter due to increased closings of single-family homes. The company currently has a backlog of more than six months of homes sold, but not closed.

OTHER

The company will hold a live conference call at 7 a.m. PDT (10 a.m. EDT) on July 25 to discuss the second quarter results.

To access the conference call, listeners calling from within North America should dial 1-877-888-3490 at least 15 minutes prior to the start of the conference call. Those wishing to access the call from outside North America should dial 1-416-695-9757. Replays of the call will be available for 48 hours following completion of the live call and can be accessed at 1-866-518-1010 within North America and at 1-416-252-1143 from outside North America.

The call may also be accessed through Weyerhaeuser's Internet site at www.weyerhaeuser.com by clicking on the "Listen to our conference call" link.

Weyerhaeuser Company, one of the world's largest integrated forest products companies, was incorporated in 1900. In 2002, sales were $29.1 billion ($18.5 billion US). It has offices or operations in 18 countries, with customers worldwide. Weyerhaeuser is principally engaged in the growing and harvesting of timber; the manufacture, distribution and sale of forest products; and real estate construction, development and related activities. Weyerhaeuser Company Limited, a wholly owned subsidiary, has Exchangeable Shares listed on the Toronto Stock Exchange under the symbol WYL. Additional information about Weyerhaeuser's businesses, products and practices is available at www.weyerhaeuser.com.

This news release 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. Some of these forward-looking statements can be identified by the use of forward-looking terminology such as "expects," "may," "will," "believes," "should," "approximately," anticipates," "estimates," and "plans," and the negative or other variations of those terms or comparable terminology or by discussions of strategy, plans or intentions. In particular, some of these forward-looking statements deal with expectations regarding the company's markets in the third quarter; expected earnings and performance of the company's business segments during the third quarter, anticipated debt reduction and anticipated capital spending. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the effect of general economic conditions, including the level of interest rates and housing starts; market demand for the company's products, which may be tied to the relative strength of various U.S. business segments; energy prices; performance of the company's manufacturing operations; the successful execution of internal performance plans; the level of competition from domestic and foreign producers; the effect of forestry, land use, environmental and other governmental regulations; fires, floods and other natural disasters; and legal proceedings. The company is also a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan, and by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the Euro and the Canadian dollar; and restrictions on international trade or tariffs imposed on imports, including the countervailing and dumping duties imposed on the company's softwood lumber shipments from Canada to the United States. These and other factors that could cause or contribute to actual results differing materially from such forward looking statements are discussed in greater detail in the company's Securities and Exchange Commission filings.

  For more information contact:
   Media - Bruce Amundson, +1-253-924-3047
   Analysts - Kathryn McAuley, +1-253-924-2058


  WEYERHAEUSER COMPANY
  STATISTICAL INFORMATION  (unaudited)

  CONSOLIDATED EARNINGS (1)                    Q1                 Q2
       (in millions)                   March 30, March 31, June 29, June 30,
                                         2003      2002      2003     2002
  Net sales and revenues:
     Weyerhaeuser (2)                   $4,169    $3,595    $4,498   $4,501
     Real estate and related assets        445       396       432      421
  Total net sales and revenues           4,614     3,991     4,930    4,922

  Costs and expenses:
     Weyerhaeuser:
       Costs of products sold            3,322     2,831     3,611    3,519
       Depreciation, amortization
        and fee stumpage                   321       264       313      311
       Selling expenses                    107       103       111      116
       General and administrative
        expenses                           231       186       232      231
       Research and development
        expenses                            12        12        12       13
       Taxes other than payroll and
        income taxes                        47        38        48       53
       Charges for integration and
        restructuring                       29         2        25       23
       Charges for closure of
        facilities                          22        27        12       28
       Other operating costs, net (3)(4)    37         4      (205)     (27)
                                         4,128     3,467     4,159    4,267

     Real estate and related assets:
       Costs and operating expenses        330       291       316      317
       Depreciation and amortization         3         2         2        1
       Selling expenses                     24        21        25       24
       General and administrative
        expenses                            14        10        14       11
       Taxes other than payroll and
        income taxes                         1         1         1        1
       Other operating costs, net           (7)       (8)       --        2
                                           365       317       358      356
  Total costs and expenses               4,493     3,784     4,517    4,623

  Operating income                         121       207       413      299

  Interest expense and other:
     Weyerhaeuser:
       Interest expense incurred (5)      (208)     (178)     (205)    (222)
       Less interest capitalized             5         4         6       16
       Equity in income (loss) of
        affiliates                          (5)       (4)        3       (2)
       Interest income and other             6         5         6        6
     Real estate and related assets:
       Interest expense incurred           (14)      (13)      (13)     (13)
       Less interest capitalized            14        13        13       13
       Equity in income of
        unconsolidated entities              5         6         7        6
       Interest income and other            11         6         8        8
  Earnings before income taxes and
   cumulative effect of a change
   in accounting principle                 (65)       46       238      111
  Income taxes                              22       (16)      (81)     (39)
  Earnings before cumulative effect
   of a change in accounting principle     (43)       30       157       72
  Cumulative effect of a change in
   accounting principle, net of
   applicable taxes of $6 (6)              (11)       --        --       --
  Net earnings (loss)                     $(54)      $30      $157      $72

  Basic and diluted net earnings (loss)
   per share:
     Net earnings (loss) before
      cumulative effect of a change
      in accounting principle           $(0.19)    $0.14     $0.71    $0.32
     Cumulative effect of a change in
      accounting principle               (0.05)       --        --       --
     Net earnings (loss)                $(0.24)    $0.14     $0.71    $0.32

  Dividends paid per share               $0.40     $0.40     $0.40    $0.40


  CONSOLIDATED EARNINGS(1)             Q3            Q4         Year ended
     (in millions)                 Sept.  Sept.  Dec.   Dec.   Dec.    Dec.
                                    28,    29,    28,    29,    28,     29,
                                   2003   2002   2003   2002   2003    2002
  Net sales and revenues:
     Weyerhaeuser(2)                    $4,422        $4,253        $16,771
     Real estate
      and related  assets                  468           465          1,750
  Total net sales and revenues           4,890         4,718         18,521

  Costs and expenses:
     Weyerhaeuser:
       Costs of products sold            3,576         3,285         13,211
       Depreciation, amortization
        and fee stumpage                   304           335          1,214
       Selling expenses                    116           115            450
       General and administrative
        expenses                           201           229            847
       Research and development
        expenses                            11            16             52
       Taxes other than payroll
        and income taxes                    48            39            178
       Charges for integration
        and restructuring                   17            30             72
       Charges for closure of
        facilities                          --            40             95
       Other operating
        costs, net(3)(4)                   19          (135)          (139)
                                         4,292         3,954         15,980
     Real estate and related
      assets:
       Costs and operating
        expenses                           359           359          1,326
       Depreciation and
        amortization                         1             7             11
       Selling expenses                     23            22             90
       General and administrative
        expenses                            14            13             48
       Taxes other than payroll
        and income taxes                     1             1              4
       Other operating costs, net            6            (1)            (1)
                                           404           401          1,478
  Total costs and expenses               4,696         4,355         17,458

  Operating income                         194           363          1,063

  Interest expense and other:
     Weyerhaeuser:
       Interest expense incurred(5)       (214)         (207)          (821)
       Less interest capitalized            16            14             50
       Equity in income (loss) of
        affiliates                          (6)           (1)           (13)
       Interest income and other             9             8             28
     Real estate and related
      assets:
       Interest expense incurred           (12)          (15)           (53)
       Less interest capitalized            12            15             53
       Equity in income of
        unconsolidated entities             10             9             31
       Interest income and other            11             8             33
  Earnings before income taxes
   and cumulative effect of a
   change in accounting principle           20           194            371
  Income taxes                              (7)          (68)          (130)
  Earnings before cumulative
   effect of a change in
   accounting principle                     13           126            241
  Cumulative effect of a change in
   accounting principle, net of
   applicable taxes of $6(6)                --            --             --
  Net earnings (loss)                      $13          $126           $241

  Basic and diluted net earnings
   (loss) per share:
     Net earnings (loss) before
      cumulative effect of a
      change in accounting
      principle                          $0.06         $0.57          $1.09
     Cumulative effect of a
      change in accounting
      principle                             --            --             --
     Net earnings (loss)                 $0.06         $0.57          $1.09

  Dividends paid per share               $0.40         $0.40          $1.60


(1) Certain reclassifications have been made to conform prior period data with the current presentation.

(2) The first and second quarters of 2003 include charges of $24 million and $26 million, respectively, for countervailing and anti-dumping duties and related costs. 2002 first quarter includes $13 million of charges for countervailing and anti-dumping duties and related costs and a credit of $18 million for the reversal of countervailing and anti-dumping duties accrued in 2001. The 2002 second quarter includes $7 million of charges for countervailing and anti-dumping duties and related costs, a credit of $29 million for the reversal of charges accrued in 2001 and a credit of $13 million for charges accrued in the first quarter of 2002. The 2002 third and fourth quarters include charges of $31 million and $26 million, respectively, for countervailing and anti-dumping duties and related costs. The 2002 impact of countervailing and anti-dumping duties and related costs is a net charge of $17 million which includes current year charges of $64 million and $47 million of credits related to the reversal of charges accrued in 2001.

(3) 2003 first and second quarters include net foreign exchange gains of $35 million and $47 million, respectively. 2002 includes $33 million in net foreign exchange gains. Gains of $8 million, $27 million and $14 million are included in the first, second and fourth quarters, respectively. A loss of $16 million is included in the third quarter.

(4) The first quarter of 2003 includes a $79 million charge for a lawsuit involving the market for Pacific Northwest alder logs. 2003 second quarter includes a $144 million gain on the sale of timberlands in Washington state and a $25 million gain for the settlement of an insurance claim relating to the Cemwood litigation. 2002 fourth quarter includes a $117 million gain on the sale of timberlands in Washington state.

(5) 2002 first quarter includes a $35 million charge to write off debt issue costs in connection with the refinancing of debt in connection with the acquisition of Willamette Industries.

(6) Statement of Financial Accounting Standards No. 143, Accounting for Asset Retirement Obligations, was adopted as of the beginning of 2003. Results for 2002 were not impacted by the change in accounting principle.

  WEYERHAEUSER COMPANY
  STATISTICAL INFORMATION  (unaudited)

  Net sales and revenues (in millions):        Q1                 Q2
                                       March 30, March 31, June 29, June 30,
                                         2003      2002      2003     2002
  Timberlands:
     Raw materials (logs, timber
      and chips)                         $203      $142      $213     $184
     Other products                        21        19        24       21
                                          224       161       237      205
  Wood Products:
     Softwood lumber                      752       692       846      901
     Plywood and veneer                   174       158       182      203
     Oriented strand board, composite
      and other panels                    257       240       331      320
     Hardwood lumber                       80        76        86       81
     Engineered lumber products           254       253       308      315
     Raw materials (logs, timber and
      chips)                               81       106        82      129
     Other products                       174       176       221      198
                                        1,772     1,701     2,056    2,147
  Pulp and Paper:
     Pulp                                 309       280       321      297
     Paper                                596       416       546      563
     Coated groundwood                     36        30        32       30
     Bleached board                        47        40        52       51
     Other products                        10         6         7       10
                                          998       772       958      951

  Containerboard, Packaging and
   Recycling:
     Containerboard                        77        73        81       90
     Packaging                            879       758       922      935
     Recycling                             60        48        63       51
     Bags                                  20        10        20       20
     Other products                        33        10        35       34
                                        1,069       899     1,121    1,130

  Real Estate and Related Assets          445       396       432      421

  Corporate and Other                     106        62       126       68

                                       $4,614    $3,991    $4,930   $4,922


  Contribution (charge)                        Q1                 Q2
   to earnings(1):
      (in millions)                    March 30, March 31, June 29, June 30,
                                         2003      2002      2003     2002
  Timberlands(2)                         $149      $107     $300     $162
  Wood Products(3)(4)(5)                 (150)        9      (53)      64
  Pulp and Paper(6)(7)                     10         1       (7)     (15)
  Containerboard, Packaging and
   Recycling(8)                            80        58      108       75
  Real Estate and Related Assets(9)        95        91       91       79
  Corporate and Other(10)(11)(12)         (46)      (46)      (2)     (48)
                                         $138      $220     $437     $317


  WEYERHAEUSER COMPANY
  STATISTICAL INFORMATION  (unaudited)

  Net sales and revenues (in
  millions):                           Q3            Q4         Year ended
                                   Sept.  Sept.  Dec.   Dec.    Dec.   Dec.
                                    28,    29,    28,    29,     28,    29,
                                   2003   2002   2003   2002    2003   2002
  Timberlands:
     Raw materials (logs, timber
      and chips)                          $193          $254           $773
     Other products                         18            39             97
                                           211           293            870
  Wood Products:
     Softwood lumber                       845           748          3,186
     Plywood and veneer                    195           178            734
     Oriented strand board,
      composite and other panels           217           251          1,028
     Hardwood lumber                        72            77            306
     Engineered lumber products            324           256          1,148
     Raw materials (logs, timber
      and chips)                           120           117            472
     Other products                        184           160            718
                                         1,957         1,787          7,592
  Pulp and Paper:
     Pulp                                  300           319          1,196
     Paper                                 590           594          2,163
     Coated groundwood                      32            34            126
     Bleached board                         37            51            179
     Other products                          8            10             34
                                           967         1,008          3,698

  Containerboard, Packaging and
   Recycling:
     Containerboard                        101            86            350
     Packaging                             909           864          3,466
     Recycling                              67            63            229
     Bags                                   22            23             75
     Other products                         28            20             92
                                         1,127         1,056          4,212

  Real Estate and Related Assets           468           465          1,750

  Corporate and Other                      160           109            399

                                        $4,890        $4,718        $18,521


  Contribution (charge)
   to earnings(1):                       Q3            Q4        Year ended
                                     Sept.  Sept.  Dec.  Dec.    Dec.  Dec.
     (in millions)                    28,    29,    28,   29,     28,   29,
                                     2003   2002   2003  2002    2003  2002
  Timberlands(2)                            $133         $300          $702
  Wood Products(3)(4)(5)                     (18)         (75)          (20)
  Pulp and Paper(6)(7)                        10           86            82
  Containerboard, Packaging and
   Recycling(8)                               88          114           335
  Real Estate and Related Assets(9)           85           81           336
  Corporate and Other(10)(11)(12)            (80)        (119)         (293)
                                             $218        $387        $1,142


(1) Certain reclassifications have been made to conform prior period data with the current presentation.

(2) 2003 second quarter includes a $144 million gain on the sale of timberlands in Washington state. 2002 fourth quarter includes a $117 million gain on the sale of timberlands in Washington state.

(3) The first and second quarters of 2003 include charges of $24 million and $26 million, respectively, for countervailing and anti-dumping duties and related costs. 2002 first quarter includes $13 million of charges for countervailing and anti-dumping duties and related costs and a credit of $18 million for the reversal of countervailing and anti-dumping duties accrued in 2001. The 2002 second quarter includes $7 million of charges for countervailing and anti-dumping duties and related costs, a credit of $29 million for the reversal of charges accrued in 2001 and a credit of $13 million for charges accrued in the first quarter of 2002. The 2002 third and fourth quarters include charges of $31 million and $26 million, respectively, for countervailing and anti-dumping duties and related costs. The 2002 impact of countervailing and anti-dumping duties and related costs is a net charge of $17 million which includes current year charges of $64 million and $47 million of credits related to the reversal of charges accrued in 2001.

(4) The first quarter of 2003 includes a $79 million charge for a lawsuit involving the market for Pacific Northwest alder logs.

(5) 2003 first and second quarters include costs for the closure of facilities of $22 million and $11 million, respectively. 2003 second quarter also includes a charge of $16 million to recognize impairment associated with an impending facility sale. 2002 includes closure costs of $51 million ($17 million in the first quarter and $34 million in the fourth quarter).

(6) 2002 includes $12 million in net business disruption costs associated with the recovery boiler explosion at the Plymouth, N.C., paper facility. Costs of $22 million and $30 million are included in the second and third quarters, respectively. Net recoveries of $40 million are included in the fourth quarter.

(7) 2003 second quarter includes $3 million of closure costs. 2002 fourth quarter results include an $8 million benefit resulting from adjustments to closure reserves established in 2001.

(8) 2003 second quarter includes the reversal of an accrual for closure charges of $2 million. 2002 includes closure costs of $52 million ($10 million in the first quarter, $28 million in the second quarter and $14 million in the fourth quarter).

(9) 2003 first quarter includes gains of $8 million for the sale of two office buildings and $10 for the sale of an apartment complex. 2003 second quarter includes a gain of $12 million for the sale of commercial property. 2002 includes $21 million in gains from sales of apartment complexes, including $7 million in the second quarter and $14 million in the third quarter.

(10) 2003 second quarter includes a $6 million charge to reflect the final settlement in connection with the termination of the former MacMillan Bloedel pension plan for U.S. employees. 2002 results include a $35 million charge in the fourth quarter related to the termination of this pension plan.

(11) 2003 second quarter includes a $25 million gain for the settlement of an insurance claim relating to the Cemwood litigation.

(12) 2003 results include net foreign exchange gains of $36 million in the first quarter and $45 million in the second quarter. 2002 results include net foreign exchange gains (losses) of $8 million in the first quarter, $27 million in the second quarter, ($17 million) in the third quarter and $14 million in the fourth quarter, for a 2002 net gain of $32 million. These gains and losses result primarily from fluctuations in Canadian and New Zealand exchange rates.

  WEYERHAEUSER COMPANY
  STATISTICAL INFORMATION  (unaudited)

  Third party sales volumes:                   Q1                 Q2
                                       March 30, March 31, June 29, June 30,
                                         2003      2002      2003     2002
  Timberlands (millions):
     Raw materials - cubic feet            96        67       110      102

  Wood Products (millions):
     Softwood lumber -
      board feet                        2,175     1,81 2    2,385    2,219
     Plywood and veneer -
      square feet (3/8")                  726       624       760      815
     Composite panels -
      square feet (3/4")                  278       308       317      445
     Oriented strand board -
      square feet (3/8")                1,025       945     1,206    1,095
     Hardwood lumber - board feet         106       108       113      113
     Raw materials - cubic feet           128       143       118      164

  Pulp and Paper (thousands):
     Pulp - air-dry metric tons           623       563       596      618
     Paper - tons                         737       546       690      717
     Coated groundwood - tons              61        48        55       49
     Bleached board - tons                 60        53        67       61
     Paper converting - tons              502       375       472      488

  Containerboard, Packaging and
   Recycling (thousands)
     Containerboard - tons                221       209       233      260
     Packaging - MSF                   17,752    15,430    18,577   19,614
     Recycling - tons                     593       604       566      552
     Bags - tons                           25        13        24       26


  Total production volumes:                    Q1                 Q2
                                       March 30, March 31, June 29, June 30,
                                         2003      2002      2003     2002
  Timberlands (millions):
     Logs - cubic feet                    182       153       152      191

  Wood Products (millions):
     Softwood lumber - board feet       1,842     1,530     1,825    1,702
     Plywood and veneer -
      square feet (3/8")                  672       471       557      649
     Composite panels -
      square feet (3/4")                  231       218       252      183
     Oriented strand board -
      square feet (3/8")                1,011       957     1,051      944
     Hardwood lumber - board feet         108        96       102       99

  Pulp and Paper (thousands):
     Pulp - air-dry metric tons           654       607       619      492
     Paper - tons                         757       510       712      667
     Coated groundwood - tons              62        48        55       60
     Bleached board - tons                 56        63        68       67
     Paper converting - tons              516       353       479      496

  Containerboard, Packaging and
   Recycling (thousands)
     Containerboard - tons              1,429     1,250     1,568    1,600
     Packaging - MSF                   18,977    16,174    19,955   20,521
     Recycling - tons                   1,528     1,387     1,644    1,588
     Bags - tons                           25        13        25       25


  Third party sales volumes:           Q3            Q4        Year ended
                                   Sept.  Sept.  Dec.   Dec.   Dec.   Dec.
                                    28,    29,    28,    29,    28,    29,
                                   2003   2002   2003   2002   2003   2002
  Timberlands (millions):
     Raw materials - cubic feet             91           110           370

  Wood Products (millions):
     Softwood lumber - board feet        2,331         2,140         8,502
     Plywood and veneer -
      square feet (3/8")                   792           672         2,903
     Composite panels -
      square feet (3/4")                    95           299         1,147
     Oriented strand board -
      square feet (3/8")                 1,117         1,048         4,205
     Hardwood lumber - board feet          104           102           427
     Raw materials - cubic feet            161           127           595

  Pulp and Paper (thousands):
     Pulp - air-dry metric tons            561           636         2,378
     Paper - tons                          749           730         2,742
     Coated groundwood - tons               55            58           210
     Bleached board - tons                  47            68           229
     Paper converting - tons               499           497         1,859

  Containerboard, Packaging and
   Recycling (thousands)
     Containerboard - tons                 283           231           983
     Packaging - MSF                    19,007        17,643        71,694
     Recycling - tons                      539           597         2,292
     Bags - tons                            26            28            93


  Total production volumes:             Q3           Q4         Year ended
                                   Sept.  Sept.  Dec.   Dec.   Dec.   Dec.
                                    28,    29,    28,    29,    28,    29,
                                   2003   2002   2003   2002   2003   2002
  Timberlands (millions):
     Logs - cubic feet                     164           155           663

  Wood Products (millions):
     Softwood lumber - board feet        1,728         1,871         6,831
     Plywood and veneer -
      square feet (3/8")                   638           520         2,278
     Composite panels -
      square feet (3/4")                   235           228           864
     Oriented strand board -
      square feet (3/8")                 1,115         1,033         4,049
     Hardwood lumber - board feet          107           104           406

  Pulp and Paper (thousands):
     Pulp - air-dry metric tons            630           552         2,281
     Paper - tons                          704           730         2,611
     Coated groundwood - tons               43            59           210
     Bleached board - tons                  31            66           227
     Paper converting - tons               502           493         1,844

  Containerboard, Packaging and
   Recycling (thousands)
     Containerboard - tons               1,621         1,533         6,004
     Packaging - MSF                    19,596        18,809        75,100
     Recycling - tons                    1,551         1,566         6,092
     Bags - tons                            27            28            93



  CONDENSED CONSOLIDATED BALANCE SHEET (unaudited)
                (in millions)
                                                        Sept. Dec.
                                     March 30, June 29,  28,   28,  Dec. 29,
  Assets                               2003     2003    2003  2003    2002

  Weyerhaeuser
     Current assets:
       Cash and short-term
        investments                     $59      $47                   $115
       Receivables, less allowances   1,573    1,671                  1,413
       Inventories                    2,167    2,093                  1,941
       Prepaid expenses                 455      427                    419
             Total current assets     4,254    4,238                  3,888
     Property and equipment          12,228   12,274                 12,278
     Construction in progress           709      669                    687
     Timber and timberlands at cost,
      less fee stumpage charged
       to disposals                   4,450    4,454                  4,402
     Investments in and advances to
      equity affiliates                 538      564                    578
     Goodwill                         3,191    3,224                  3,131
     Deferred pension and other
      assets                          1,337    1,349                  1,285
                                     26,707   26,772                 26,249

  Real estate and related assets      1,989    2,065                  1,970

     Total assets                   $28,696  $28,837                $28,219

  Liabilities and Shareholders'
   Interest

  Weyerhaeuser
     Current liabilities:
       Notes payable and commercial
        paper                          $321     $238                     $2
       Current maturities of long-
        term debt                       595      594                    786
       Accounts payable                 975    1,046                    983
       Accrued liabilities            1,162    1,192                  1,223
             Total current
              liabilities             3,053    3,070                  2,994
     Long-term debt                  12,129   11,866                 11,907
     Deferred income taxes,
      pension, other postretirement
      benefits
       and other liabilities          5,541    5,612                  5,346
                                     20,723   20,548                 20,247
  Real estate and related assets
     Notes payable and commercial
      paper                             115      130                     63
     Long-term debt                     764      762                    814
     Other liabilities                  466      491                    472
                                      1,345    1,383                  1,349
     Total liabilities               22,068   21,931                 21,596

     Shareholders' interest           6,628    6,906                  6,623

     Total liabilities and
      shareholders' interest        $28,696  $28,837                $28,219



  STATEMENT OF CASH FLOWS                     Q1                 Q2
  SELECTED INFORMATION (unaudited)     March 30, March 31, June 29, June 30,
     (in millions)                       2003      2002      2003     2002
  (Weyerhaeuser only, excludes real
   estate & related assets)

     Net cash from operations           $(126)     $(90)     $465     $379
     Cash paid for property and
      equipment                          (128)     (158)     (172)    (288)
     Cash paid for timberlands
      reforestation                       (14)      (12)       (5)      (8)
     Cash received from issuances of
      debt                                  1    13,001        --      100
     Revolving credit facilities,
      notes and commercial paper
       borrowings, net                    599        30      (333)    (150)
     Payments on debt                    (251)   (6,593)      (14)     (97)


  STATEMENT OF CASH FLOWS              Q3             Q4         Year ended
                                    Sept.  Sept.  Dec.   Dec.   Dec.   Dec.
  SELECTED INFORMATION (unaudited)   28,    29,    28,    29,    28,    29,
     (in millions)                  2003   2002   2003   2002   2003   2002
  (Weyerhaeuser only, excludes
   real estate & related assets)

     Net cash from operations              $268          $701        $1,258
     Cash paid for property and
      equipment                            (237)         (241)         (924)
     Cash paid for timberlands
      reforestation                          (6)          (10)          (36)
     Cash received from issuances
      of debt                                26         1,015        14,142
     Revolving credit facilities,
      notes and commercial paper
      borrowings, net                       122          (230)         (228)
     Payments on debt                      (159)       (1,375)       (8,224)

SOURCE: Weyerhaeuser Company Limited

CONTACT: media, Bruce Amundson, +1-253-924-3047, or analysts, Kathryn
McAuley, +1-253-924-2058, both of Weyerhaeuser Company Limited

Web site: http://www.weyerhaeuser.com/


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