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Weyerhaeuser Reports First Quarter Results

May 1, 2015

FEDERAL WAY, Wash., May 1, 2015 /PRNewswire/ -- Weyerhaeuser Company (NYSE: WY) today reported first quarter net earnings to common shareholders of $90 million, or 17 cents per diluted share, on net sales of $1.7 billion. This compares with net earnings of $183 million, or 31 cents per diluted share, on net sales from continuing operations of $1.7 billion for the same period last year.

Weyerhaeuser Company logo.

Excluding after-tax charges of $9 million for special items, the company reported net earnings of $99 million, or 19 cents per diluted share for the first quarter. This compares with net earnings from continuing operations before special items of $143 million for the same period last year and $145 million for fourth quarter 2014.

"We are pleased with our first quarter performance in Timberlands and Wood Products, as operational excellence efforts resulted in higher earnings compared with the fourth quarter in both businesses despite weaker market conditions," said Doyle Simons, president and chief executive officer. "Our Cellulose Fibers business was challenged by a strengthening U.S. dollar, West Coast port disruptions, and a slower than expected restart of our largest fluff mill after a scheduled maintenance outage in the quarter. We repurchased over $250 million of common shares in the quarter, and have now completed 65 percent of our authorization. We look forward to an improving spring selling season and continue to expect measured growth in U.S. housing starts."

WEYERHAEUSER FINANCIAL HIGHLIGHTS

2014

2015

2014

(millions, except per share data)

4Q

1Q

1Q

Net sales from continuing operations

$1,788

$1,721

$1,736

Net earnings attributable to Weyerhaeuser common shareholders(1)

$166

$90

$183

Weighted average shares outstanding, diluted(2)

529

527

589

Earnings per diluted share

$0.31

$0.17

$0.31

Earnings per diluted share from continuing operations

$0.31

$0.17

$0.29

Net earnings from continuing operations before special items(3)

$145

$99

$143

Earnings per diluted share from continuing operations before special items

$0.27

$0.19

$0.24

Net change in cash and cash equivalents(4)

($40)

($422)

($53)

Cash and cash equivalents at end of period(4)

$1,580

$1,158

$777

(1) First quarter 2014 includes net earnings from discontinued operations of $10 million.
(2) During the third quarter of 2014 Weyerhaeuser retired approximately 59 million shares tendered under the exchange offer associated with the divestiture of Weyerhaeuser Real Estate Company. Through first quarter 2015, Weyerhaeuser repurchased approximately 13 million common shares under the repurchase program announced in third quarter 2014. At the end of the first quarter the company had approximately 519 million common shares outstanding.
(3) Special items for the first quarter 2015 include a charge for impairment on a nonstrategic asset. Special items for the first and fourth quarters of 2014 include gains on a postretirement plan amendment and restructuring charges related to the company's SG&A cost reduction initiative. First quarter 2014 also includes a gain on a nonstrategic asset sale.
(4) Net change in cash and equivalents, and cash and cash equivalents at the end of the period exclude discontinued operations.

TIMBERLANDS

     
       

FINANCIAL HIGHLIGHTS (millions)

4Q 2014

1Q 2015

Change

Net sales

$359

$351

($8)

Contribution to pre-tax earnings

$143

$162

$19

1Q 2015 Performance — Cost efficiencies from operational excellence initiatives across the segment more than offset lower Western log realizations. In the South, seasonal decreases in fee harvest volumes were partially offset by seasonally lower silviculture expenses. Earnings from the disposition of nonstrategic timberlands increased by $14 million compared with fourth quarter 2014.

2Q 2015 Outlook — Weyerhaeuser expects lower earnings from the Timberlands segment in the second quarter due to a decrease in realizations for Western logs and lower earnings from the disposition of nonstrategic timberlands.

WOOD PRODUCTS

     
       

FINANCIAL HIGHLIGHTS (millions)

4Q 2014

1Q 2015

Change

Net sales

$947

$923

($24)

Contribution to pre-tax earnings

$56

$62

$6

1Q 2015 Performance — Manufacturing costs improved due to operational excellence initiatives across our system, and higher production volumes for engineered wood products. These improvements were partially offset by lower average sales realizations across all product lines.

2Q 2015 Outlook — Weyerhaeuser expects significantly higher earnings from the Wood Products segment in the second quarter. The company anticipates seasonally higher sales volumes across all product lines and average sales realizations for lumber and oriented strand board comparable to the first quarter. The company also expects lower Western log costs and lower per unit manufacturing costs.

CELLULOSE FIBERS

     
       

FINANCIAL HIGHLIGHTS (millions)

4Q 2014

1Q 2015

Change

Net sales

$482

$447

($35)

Contribution to pre-tax earnings

$87

$33

($54)

1Q 2015 Performance — Average pulp sales realizations and volumes decreased, and costs increased primarily due to a scheduled maintenance outage at our largest fluff mill. While the restart took longer than anticipated, the mill is now running well. The West Coast port disruptions resulted in an extensive production curtailment in our liquid packaging operation and higher transportation and warehousing costs throughout the segment.

2Q 2015 Outlook — Weyerhaeuser expects lower earnings from the Cellulose Fibers segment in the second quarter. The company anticipates lower average pulp sales realizations. Costs will increase due to an extended pulp mill outage for scheduled maintenance and installation of energy-related capital improvements.

UNALLOCATED ITEMS
Due to a strengthening U.S. dollar, first quarter 2015 earnings include a $29 million pre-tax charge ($0.04 per share after-tax) for noncash foreign exchange losses on debt held by our Canadian entity.

ABOUT WEYERHAEUSER
Weyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control nearly 7 million acres of timberlands, primarily in the U.S., and manage additional timberlands under long-term licenses in Canada. We manage these timberlands on a sustainable basis in compliance with internationally recognized forestry standards. We are also one of the largest manufacturers of wood and cellulose fibers products. Our company is a real estate investment trust. In 2014, our continuing operations generated $7.4 billion in sales and employed approximately 12,800 people who serve customers worldwide. We are listed on the Dow Jones World Sustainability Index. Our common stock trades on the New York Stock Exchange under the symbol WY. Learn more at www.weyerhaeuser.com.

EARNINGS CALL INFORMATION
Weyerhaeuser will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on May 1 to discuss first quarter results.

To access the live webcast and presentation online, go to the Investor Relations section on www.weyerhaeuser.com on May 1.

To join the conference call from within North America, dial 877-296-9413 (access code: 28308831) at least 15 minutes prior to the call. Those calling from outside North America should dial 706-679-2458 (access code: 28308831). Replays will be available for one week at 855-859-2056 (access code: 28308831) from within North America and at 404-537-3406 (access code: 28308831) from outside North America.

FORWARD LOOKING STATEMENTS
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. These statements are based on our current expectations and various assumptions that are subject to risks and uncertainties. Factors listed below, as well as other factors, may cause actual results to differ significantly from these forward-looking statements. There is no guarantee that any of the events anticipated by these forward-looking statements will occur. If any of the events occur, there is no guarantee what effect they will have on company operations or financial condition. The company will not update these forward-looking statements after the date of this news release.

Some forward-looking statements discuss the company's plans, strategies, expectations and intentions. They use words such as "expects," "may," "will," "believes," "should," "approximately," "anticipates," "estimates," and "plans."  In addition, these words may use the positive or negative or other variations of those and similar words.

This release contains forward-looking statements regarding the company's expectations during the second quarter of 2015, including with respect to: earnings; log realizations and dispositions of non-strategic timberlands in Timberlands; sales volumes across Wood Products product lines, log and manufacturing costs and expected realizations for lumber and oriented strand board in Wood Products; and maintenance and capital costs, and realizations for pulp in Cellulose Fibers.

Major risks, uncertainties and assumptions that affect the company's businesses and may cause actual results to differ from these forward-looking statements, include, but are not limited to:

  • the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages, and strength of the U.S. dollar;
  • market demand for the company's products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions;
  • performance of the company's manufacturing operations, including maintenance requirements;
  • the level of competition from domestic and foreign producers;
  • the successful execution of internal performance plans, including restructurings and cost reduction initiatives;
  • raw material prices;
  • energy prices;
  • the effect of weather;
  • the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters;
  • transportation availability and costs;
  • federal tax policies;
  • the effect of forestry, land use, environmental and other governmental regulations;
  • legal proceedings;
  • performance of pension fund investments and related derivatives;
  • the effect of timing of retirements and changes in the market price of company stock on charges for stock-based compensation;
  • changes in accounting principles; and
  • other factors described in the company's filings with the SEC, including the "Risk Factors" section in the company's annual report on Form 10-K for the year ended December 31, 2014.

The company also is a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan and China. It is affected by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the euro, yen and the Canadian dollar, and the relative value of the euro and the yen. Restrictions on international trade or tariffs imposed on imports and disruptions in shipping and transportation also may affect the company.

View our financials in a printer-friendly PDF.

For more information contact:

 

Analysts - Beth Baum or Denise Merle (253) 924-2058

   

Media - Anthony Chavez (253) 924-7148

 

Weyerhaeuser Company

   

Exhibit 99.2

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

         

Consolidated Statement of Operations

           

in millions

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Net Sales

$  1,788

 

$ 1,721

 

$ 1,736

Cost of products sold

1,399

 

1,385

 

1,361

Gross margin

389

 

336

 

375

Selling expenses

29

 

28

 

28

General and administrative expenses

89

 

74

 

88

Research and development expenses

8

 

5

 

7

Charges for restructuring, closures and impairments

7

 

14

 

19

Other operating costs (income), net

(38)

 

15

 

(75)

Operating income

294

 

200

 

308

Interest income and other

10

 

3

 

9

Interest expense, net of capitalized interest

(90)

 

(83)

 

(83)

Earnings from continuing operations before income taxes

214

 

120

 

234

Income taxes

(37)

 

(19)

 

(50)

Earnings from continuing operations

177

 

101

 

184

Earnings from discontinued operations, net of income taxes

 

 

10

Net earnings

177

 

101

 

194

Dividends on preference shares

(11)

 

(11)

 

(11)

Net earnings attributable to Weyerhaeuser common shareholders

$     166

 

$       90

 

$    183

 

Per Share Information

 
 

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Earnings per share attributable to Weyerhaeuser common shareholders, basic:

         

Continuing operations

$      0.32

 

$     0.17

 

$     0.29

Discontinued operations

 

 

0.02

Net earnings per share

$      0.32

 

$     0.17

 

$     0.31

Earnings per share attributable to Weyerhaeuser common shareholders, diluted:

         

Continuing operations

$      0.31

 

$     0.17

 

$     0.29

Discontinued operations

 

 

0.02

Net earnings per share

$      0.31

 

$     0.17

 

$     0.31

Dividends paid per common share

$      0.29

 

$     0.29

 

$     0.22

Weighted average shares outstanding (in thousands):

         

Basic

524,838

 

523,426

 

584,915

Diluted

529,411

 

527,423

 

589,312

Common shares outstanding at end of period (in thousands)

524,474

 

518,735

 

584,961

           

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*

           

in millions

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Net earnings

$       177

 

$      101

 

$      194

Earnings from discontinued operations, net of income taxes

 

 

(10)

Interest income and other

(10)

 

(3)

 

(9)

Interest expense, net of capitalized interest

90

 

83

 

83

Income taxes

37

 

19

 

50

Operating income

294

 

200

 

308

Depreciation, depletion and amortization

125

 

123

 

123

Non-operating pension and postretirement credits

(12)

 

(3)

 

(10)

Special items

(31)

 

13

 

(49)

Adjusted EBITDA*

$     376

 

$    333

 

$    372

* Non-GAAP measure - see page 8 for definition.

         

 

Weyerhaeuser Company

 

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

     

Consolidated Balance Sheet

       

in millions

March 31,
2015

 

December 31,
2014

 

ASSETS

     

Current assets:

     

Cash and cash equivalents

$     1,158

 

$     1,580

Receivables, less allowances

539

 

525

Receivables for taxes

23

 

25

Inventories

645

 

595

Prepaid expenses

95

 

80

Deferred tax assets

192

 

228

Total current assets

2,652

 

3,033

Property and equipment, net

2,524

 

2,623

Construction in progress

171

 

131

Timber and timberlands at cost, less depletion charged to disposals

6,552

 

6,530

Investments in and advances to equity affiliates

183

 

188

Goodwill

40

 

40

Deferred tax assets

3

 

8

Other assets

269

 

289

Restricted financial investments held by variable interest entities

615

 

615

Total assets

$ 13,009

 

$ 13,457

       

LIABILITIES AND EQUITY

     

Current liabilities:

     

Accounts payable

$        319

 

$        331

Accrued liabilities

533

 

587

Total current liabilities

852

 

918

Long-term debt

4,891

 

4,891

Long-term debt (nonrecourse to the company) held by variable interest entities

511

 

511

Deferred income taxes

195

 

206

Deferred pension and other postretirement benefits

1,249

 

1,319

Other liabilities

284

 

308

Total liabilities

7,982

 

8,153

Total equity

5,027

 

5,304

Total liabilities and equity

$ 13,009

 

$ 13,457

 

Weyerhaeuser Company

     

Q1.2015 Analyst Package

         

Preliminary results, subject to audit

         

Consolidated Statement of Cash Flows

           

in millions

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Cash flows from operations:

         

Net earnings

$       177

 

$     101

 

$     194

Noncash charges (credits) to income:

         

Depreciation, depletion and amortization

125

 

123

 

126

Deferred income taxes, net

35

 

13

 

36

Pension and other postretirement benefits

(48)

 

10

 

(47)

Share-based compensation expense

11

 

8

 

9

Charges for impairment of assets

1

 

13

 

Net gains on dispositions of assets and operations

(2)

 

(16)

 

(25)

Foreign exchange transaction losses

12

 

29

 

14

Change in:

         

Receivables less allowances

57

 

(16)

 

(1)

Receivable for taxes

(1)

 

2

 

67

Inventories

(20)

 

(57)

 

(88)

Real estate and land

 

 

(72)

Prepaid expenses

11

 

(11)

 

3

Accounts payable and accrued liabilities

(22)

 

(91)

 

(80)

Deposits on land positions and other assets

 

 

12

Pension and postretirement contributions

(16)

 

(20)

 

(33)

Other

(16)

 

(11)

 

(6)

Net cash from operations

304

 

77

 

109

           

Cash flows from investing activities:

         

Property and equipment

(115)

 

(71)

 

(51)

Timberlands reforestation

(9)

 

(18)

 

(14)

Acquisition of timberlands

(3)

 

(32)

 

Proceeds from sale of assets

4

 

2

 

19

Other

(1)

 

 

Cash from investing activities

(124)

 

(119)

 

(46)

           

Cash flows from financing activities:

         

Cash dividends on common shares

(152)

 

(152)

 

(129)

Cash dividends on preference shares

(22)

 

 

Change in book overdrafts

 

 

(6)

Exercises of stock options

35

 

21

 

15

Repurchase of common stock

(80)

 

(253)

 

Other

(1)

 

4

 

2

Cash from financing activities

(220)

 

(380)

 

(118)

           

Net change in cash and cash equivalents

(40)

 

(422)

 

(55)

Cash and cash equivalents at beginning of period

1,620

 

1,580

 

835

Cash and cash equivalents at end of period

$    1,580

 

$  1,158

 

$     780

Cash paid (received) during the year for:

         

Interest, net of amount capitalized

$         66

 

$     114

 

$     101

Income taxes

$           3

 

$         1

 

$     (50)

 

Weyerhaeuser Company

Total Company Statistics

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

         

Special Items Included in Net Earnings

           

in millions

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Net earnings attributable to Weyerhaeuser common shareholders

$    166

 

$    90

 

$  183

Restructuring, impairments and other charges

4

 

9

 

13

Gain on sale of non-strategic asset

 

 

(14)

Gain on postretirement plan amendment

(25)

 

 

(29)

Net earnings attributable to Weyerhaeuser common shareholders before special items

145

 

99

 

153

Earnings from discontinued operations, net of income taxes

 

 

(10)

Net earnings from continuing operations attributable to Weyerhaeuser common shareholders before special items

$    145

 

$    99

 

$  143

           
 

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Net earnings per diluted share attributable to Weyerhaeuser common shareholders

$   0.31

 

$ 0.17

 

$ 0.31

Restructuring, impairments and other charges

0.01

 

0.02

 

0.02

Gain on sale of non-strategic asset

 

 

(0.02)

Gain on postretirement plan amendment

(0.05)

 

 

(0.05)

Net earnings per diluted share attributable to Weyerhaeuser common shareholders before special items

0.27

 

0.19

 

0.26

Earnings from discontinued operations, net of income taxes

 

 

(0.02)

Net earnings from continuing operations per diluted share attributable to Weyerhaeuser common shareholders before special items

$   0.27

 

$ 0.19

 

$ 0.24

 

Selected Total Company Items

 

in millions

Q4

 

Q1

 

December 31,
2014

 

March 31,
2015

 

March 31,
2014

Depreciation, depletion and amortization:

         

Cost of products sold

$      119

 

$   118

 

$   117

Selling, general and administrative expenses

6

 

5

 

6

Total depreciation, depletion and amortization

$      125

 

$   123

 

$   123

           

Pension and postretirement costs:

         

Pension and postretirement costs allocated to business segments

$        12

 

$     13

 

$     10

Pension and postretirement credits not allocated

(12)

 

(3)

 

(10)

Total company pension and postretirement costs

$       —

 

$     10

 

$     —

           

Total decrease (increase) in working capital(1)

$          6

 

$  (212)

 

$  (170)

Cash spent for capital expenditures

$    (124)

 

$    (89)

 

$    (63)

(1)Working capital does not include cash balances.

         

 

Weyerhaeuser Company

Timberlands Segment

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

         
             

Segment Statement of Operations

             

in millions

 

Q4.2014

 

Q1.2015

 

Q1.2014

Sales to unaffiliated customers

$      359

 

$    351

 

$      377

Intersegment sales

225

 

228

 

238

Total net sales

584

 

579

 

615

Cost of products sold

424

 

405

 

431

Gross margin

160

 

174

 

184

Selling expenses

1

 

2

 

2

General and administrative expenses

25

 

22

 

26

Research and development expenses

5

 

3

 

4

Other operating income, net

(14)

 

(15)

 

(12)

Operating income

143

 

162

 

164

Interest income and other

 

 

Net contribution to earnings

$     143

 

$   162

 

$     164

             

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*

             

in millions

 

Q4.2014

 

Q1.2015

 

Q1.2014

Operating income

$     143

 

$   162

 

$     164

Depreciation, depletion and amortization

53

 

53

 

52

Adjusted EBITDA*

$     196

 

$   215

 

$     216

* Non-GAAP measure - see page 8 for definition.

         
             

Selected Segment Items

             
   

Q4.2014

 

Q1.2015

 

Q1.2014

Total decrease (increase) in working capital(1)

$          8

 

$    (26)

 

$      (29)

Cash spent for capital expenditures

$      (18)

 

$    (24)

 

$      (19)

(1)Working capital does not include cash balances.

         
             

Segment Statistics

             
 

Q4.2014

 

Q1.2015

 

Q1.2014

Third Party 
Net Sales 
(millions)

Logs:

         

West

$      227

 

$    210

 

$      257

South

66

 

58

 

62

Canada

10

 

8

 

6

Total logs

303

 

276

 

325

Chip sales

3

 

4

 

3

Timberlands exchanges

3

 

25

 

4

Higher and better use land sales

5

 

2

 

3

Minerals, oil and gas

7

 

7

 

7

Products from international operations

24

 

24

 

24

Other products

14

 

13

 

11

Total

$      359

 

$    351

 

$      377

Logs
Third Party Sales
Realizations
(per cubic meter)

West

$ 106.73

 

$ 98.83

 

$ 114.46

South

$   45.56

 

$ 45.33

 

$   44.88

Canada

$   38.82

 

$ 34.84

 

$   35.30

International

$   18.64

 

$ 19.35

 

$   16.99

Logs
Third Party Sales
Volumes
(cubic meters, thousands)

West

2,121

 

2,120

 

2,246

South

1,454

 

1,271

 

1,385

Canada

254

 

245

 

156

International

148

 

150

 

147

Total

3,977

 

3,786

 

3,934

Logs
Fee Harvest Volumes
(cubic meters, thousands)

West

2,754

 

2,911

 

2,875

South

3,145

 

2,732

 

2,866

International

260

 

239

 

249

Total

6,159

 

5,882

 

5,990

 

Weyerhaeuser Company

Wood Products Segment

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

         
             

Segment Statement of Operations  

             

in millions

 

Q4.2014

 

Q1.2015

 

Q1.2014

Sales to unaffiliated customers

$    947

 

$    923

 

$    898

Intersegment sales

20

 

19

 

19

Total net sales

967

 

942

 

917

Cost of products sold

855

 

829

 

791

Gross margin

112

 

113

 

126

Selling expenses

24

 

23

 

25

General and administrative expenses

32

 

27

 

37

Research and development expenses

1

 

 

1

Other operating costs (income), net

(1)

 

1

 

(1)

Operating income

56

 

62

 

64

Interest income and other

 

 

Net contribution to earnings

$     56

 

$     62

 

$     64

             

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*

             

in millions

 

Q4.2014

 

Q1.2015

 

Q1.2014

Operating income

$     56

 

$     62

 

$     64

Depreciation, depletion and amortization

30

 

26

 

29

Adjusted EBITDA*

$     86

 

$     88

 

$     93

* Non-GAAP measure - see page 8 for definition.

         
             

Selected Segment Items

             
   

Q4.2014

 

Q1.2015

 

Q1.2014

Total decrease (increase) in working capital(1)

$      29

 

$     (99)

 

$   (137)

Cash spent for capital expenditures

$     (78)

 

$     (37)

 

$     (18)

(1)Working capital does not include cash balances.

         
             

Segment Statistics

             

in millions, except for third-party sales realizations

Q4.2014

 

Q1.2015

 

Q1.2014

 

Structural Lumber
(board feet)

Third party net sales

$    459

 

$    434

 

$    427

Third party sales realizations

$    415

 

$    403

 

$    432

Third party sales volumes(1)

1,106

 

1,075

 

989

Production volumes

1,013

 

1,043

 

1,009

Outside purchase volumes

94

 

89

 

78

 

Engineered Solid
Section
(cubic feet)

Third party net sales

$      94

 

$      94

 

$      90

Third party sales realizations

$ 2,060

 

$ 1,965

 

$ 1,959

Third party sales volumes(1)

4.5

 

4.8

 

4.6

Production volumes

4.6

 

5.0

 

4.9

Outside purchase volumes

 

 

1.8

 

Engineered
I-joists
(lineal feet)

Third party net sales

$      63

 

$      61

 

$      59

Third party sales realizations

$ 1,549

 

$ 1,510

 

$ 1,454

Third party sales volumes(1)

40

 

41

 

40

Production volumes

33

 

43

 

44

Outside purchase volumes

2

 

1

 

1

 

Oriented Strand
Board
(square feet 3/8')

Third party net sales

$    146

 

$    137

 

$    148

Third party sales realizations

$    206

 

$    196

 

$    230

Third party sales volumes(1)

709

 

700

 

641

Production volumes

694

 

704

 

657

Outside purchase volumes

61

 

65

 

53

 

Softwood Plywood
(square feet 3/8')

Third party net sales

$      36

 

$      33

 

$      30

Third party sales realizations

$    384

 

$    366

 

$    332

Third party sales volumes(1)

93

 

89

 

90

Production volumes

61

 

61

 

59

Outside purchase volumes

42

 

37

 

33

(1)Volumes include sales of internally produced products and products purchased for resale primarily through our distribution business.

 

Weyerhaeuser Company

Cellulose Fibers Segment

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

         
             

Segment Statement of Operations

             

in millions

 

Q4.2014

 

Q1.2015

 

Q1.2014

Total net sales

$   482

 

$   447

 

$   461

Cost of products sold

379

 

394

 

390

Gross margin

103

 

53

 

71

Selling expenses

4

 

3

 

4

General and administrative expenses

18

 

17

 

20

Research and development expenses

2

 

2

 

2

Other operating income, net

(8)

 

(8)

 

(9)

Operating income

87

 

39

 

54

Interest income and other

 

(6)

 

Net contribution to earnings

$     87

 

$     33

 

$     54

             

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*

             

in millions

 

Q4.2014

 

Q1.2015

 

Q1.2014

Operating income

$     87

 

$     39

 

$     54

Depreciation, depletion and amortization

39

 

39

 

38

Adjusted EBITDA*

$   126

 

$     78

 

$     92

* Non-GAAP measure - see page 8 for definition.

         
             

Selected Segment Items

             
   

Q4.2014

 

Q1.2015

 

Q1.2014

Total decrease (increase) in working capital(1)

$    (47)

 

$      40

 

$      31

Cash spent for capital expenditures

$    (26)

 

$    (27)

 

$    (26)

(1)Working capital does not include cash balances.

         
             

Segment Statistics

             
   

Q4.2014

 

Q1.2015

 

Q1.2014

 

Pulp
(air-dry metric tons)

Third party net sales (millions)

$    405

 

$    360

 

$    363

Third party sales realizations

$    886

 

$    854

 

$    825

Third party sales volumes (thousands)

458

 

421

 

440

Production volumes (thousands)

468

 

442

 

459

Liquid
Packaging
Board
(metric tons)

Third party net sales (millions)

$      63

 

$      74

 

$      80

Third party sales realizations

$ 1,133

 

$ 1,194

 

$ 1,237

Third party sales volumes (thousands)

55

 

62

 

65

Production volumes (thousands)

70

 

60

 

70

 

Weyerhaeuser Company

Unallocated Items

Q1.2015 Analyst Package

     

Preliminary results, subject to audit

         
           

Unallocated items are gains or charges not related to or allocated to an individual operating segment. They include a portion of items such as: share-based compensation, pension and postretirement costs, foreign exchange transaction gains and losses associated with financing and the elimination of intersegment profit in inventory and the LIFO reserve.

           

Contribution to Earnings

           

in millions

Q4.2014

 

Q1.2015

 

Q1.2014

Unallocated corporate function expenses

$       (7)

 

$       (9)

 

$       (7)

Unallocated share-based compensation

(7)

 

3

 

3

Unallocated pension & postretirement credits

50

 

3

 

55

Foreign exchange losses

(11)

 

(29)

 

(15)

Elimination of intersegment profit in inventory and LIFO

(2)

 

(12)

 

(19)

Other

(15)

 

(19)

 

9

Operating income (loss)

8

 

(63)

 

26

Interest income and other

10

 

9

 

9

Net contribution to earnings from continuing operations(1)

$     18

 

$    (54)

 

$     35

(1)We have reclassified certain results from the prior periods to present the results of operations discontinued in 2014 separately.
Our reclassifications had no effect on net earnings or Weyerhaeuser shareholders' interest.

           
           

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*

           

in millions

Q4.2014

 

Q1.2015

 

Q1.2014

Operating income (loss)

$        8

 

$    (63)

 

$     26

Depreciation, depletion and amortization

3

 

5

 

4

Non-operating pension and postretirement credits

(12)

 

(3)

 

(10)

Special items

(31)

 

13

 

(49)

Adjusted EBITDA*

$    (32)

 

$    (48)

 

$    (29)

* Non-GAAP measure - see below for definition.

         
           

Unallocated Special Items Included in Net Contribution to Earnings (Pre-Tax)

           
 

Q4.2014

 

Q1.2015

 

Q1.2014

Gain on postretirement plan amendment

$      38

 

$      —

 

$      45

Restructuring, impairments and other charges

(7)

 

(13)

 

(18)

Gain on sale of non-strategic asset

 

 

22

Total

$     31

 

$    (13)

 

$     49

           

Unallocated Selected Items

           
 

Q4.2014

 

Q1.2015

 

Q1.2014

Total decrease (increase) in working capital(1)

$      16

 

$   (127)

 

$     (35)

Cash spent for capital expenditures

$       (2)

 

$       (1)

 

$      —

(1)Working capital does not include cash balances.

         
           

*Adjusted EBITDA is a non-GAAP measure that management uses to evaluate the performance of the company. Adjusted EBITDA, as we define it, is operating income from continuing operations adjusted for depreciation, depletion, amortization, pension and postretirement costs not allocated to business segments (primarily interest cost, expected return on plan assets, amortization of actuarial loss and amortization of prior service cost/credit), special items and discontinued operations. Adjusted EBITDA should not be considered in isolation from and is not intended to represent an alternative to our GAAP results.

 

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SOURCE Weyerhaeuser Company


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