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Weyerhaeuser reports fourth quarter, full year results

- Generated full year net earnings of over $1 billion or $1.39 per diluted share

- Increased Adjusted EBITDA by nearly 55 percent

- Merged with Plum Creek, ahead of schedule on capturing synergies

- Sold Cellulose Fibers businesses for $2.5 billion and net gain of $546 million

- Repurchased $2 billion of common shares

Feb 3, 2017

SEATTLE, Feb. 3, 2017 /PRNewswire/ -- Weyerhaeuser Company (NYSE: WY) today reported fourth quarter net earnings to common shareholders of $551 million, or 73 cents per diluted share, on net sales of $1.6 billion. This compares with net earnings of $59 million, or 11 cents per diluted share, on net sales of $1.3 billion for the same period last year.

Fourth quarter results include after-tax earnings of $489 million from discontinued operations, primarily consisting of gains from the divestiture of the Cellulose Fibers pulp mills and printing papers business, and net after-tax charges of $44 million for special items. Excluding discontinued operations and special items, the company reported net earnings of $106 million or 14 cents per diluted share. This compares with net earnings from continuing operations before special items of $81 million for the same period last year and $172 million for third quarter 2016.

For the full year 2016, Weyerhaeuser reported net earnings attributable to common shareholders of $1.005 billion, or $1.39 per diluted share, on net sales of $6.4 billion. This compares with net earnings of $462 million on net sales of $5.2 billion for the same period last year. 2016 results include after-tax earnings of $612 million from discontinued operations related to the divested Cellulose Fibers segment.

Full year 2016 includes net after-tax charges of $141 million from special items. Excluding these items, the company reported net earnings from continuing operations before special items of $534 million, or 75 cents per diluted share. This compares with net earnings from continuing operations before special items of $382 million for the full year 2015.

"2016 was a transformational year for Weyerhaeuser. Through our merger with Plum Creek and the $2.5 billion divestiture of our Cellulose Fibers business, we became a focused timber, land and forest products company and nearly doubled the size of our timberland holdings," said Doyle R. Simons, president and chief executive officer. "In addition to completing these significant portfolio changes, we increased Adjusted EBITDA by nearly 55 percent, delivered more than $100 million of operational excellence improvements, captured significant merger synergies, and achieved the highest annual Wood Products earnings in over a decade. Finally, we returned cash to shareholders through a $2 billion share repurchase. Entering 2017, we remain strongly committed to driving industry-leading performance, continuing to capture benefits of the merger, and demonstrating disciplined capital allocation to drive superior value for shareholders."

WEYERHAEUSER FINANCIAL HIGHLIGHTS 
Weyerhaeuser merged with Plum Creek Timber Company, Inc. (Plum Creek) on February 19, 2016.  The financial statements presented within this release do not include Plum Creek financial results for any period prior to the February 19, 2016 merger date.

During 2016, Weyerhaeuser sold its Cellulose Fibers businesses. Results for the Cellulose Fibers segment are presented as discontinued operations. All periods presented have been revised to separate results of discontinued operations from the results of our continuing operations.

WEYERHAEUSER FINANCIAL HIGHLIGHTS

2016

   

2016

   

2015

   

2016

 

2015

 

(millions, except per share data)

Q3

   

Q4

   

Q4

   

Full Year

 

Net sales

$

1,709

   

$

1,596

   

$

1,266

   

$

6,365

 

$

5,246

 
                 

Net earnings attributable to common shareholders

$

227

   

$

551

   

$

59

   

$

1,005

 

$

462

 

Weighted average shares outstanding, diluted(1)

754

   

753

   

514

   

722

 

520

 

Earnings per diluted share

$

0.30

   

$

0.73

   

$

0.11

   

$

1.39

 

$

0.89

 
                 

Net earnings from continuing operations attributable to Weyerhaeuser common shareholders before special items(2)

$

172

   

$

106

   

$

81

   

$

534

 

$

382

 

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

$

0.23

   

$

0.14

   

$

0.16

   

$

0.75

 

$

0.74

 
                 

Adjusted EBITDA(3)

$

434

   

$

400

   

$

248

   

$

1,583

 

$

1,025

 
                 

(1) In first quarter 2016, Weyerhaeuser issued approximately 279 million shares in conjunction with the Plum Creek merger. During 2016, Weyerhaeuser repurchased approximately 68 million shares to complete our $2 billion accelerated repurchase commitment, part of the $2.5 billion repurchase authorization announced in conjunction with the merger transaction. In third quarter 2016, the company issued approximately 23 million shares as a result of the conversion of its mandatory convertible preference shares.

(2) After-tax special items for fourth quarter 2016 include a $24 million tax adjustment, $11 million for Plum Creek merger-related costs and $9 million of non-cash charges related to legacy real estate projects. Full year 2016 and full year 2015 include after-tax special charges from continuing operations of $141 million and $15 million respectively, primarily for Plum Creek merger-related costs.

(3) 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, basis in real estate sold, pension and postretirement costs not allocated to business segments and special items. Adjusted EBITDA excludes results from joint ventures. Adjusted EBITDA should not be considered in isolation from and is not intended to represent an alternative to our GAAP results. A reconciliation of Adjusted EBITDA to GAAP earnings is included within this release.

TIMBERLANDS

FINANCIAL HIGHLIGHTS (millions)

3Q 2016

   

4Q 2016

   

Change

Net sales

$

700

   

$

672

   

$

(28)

Contribution to pre-tax earnings

$

122

   

$

123

   

$

1

Adjusted EBITDA

$

223

   

$

223

   

$

4Q 2016 Performance - In the South, average log sales realizations were comparable to third quarter and silviculture expenses decreased seasonally.  In the West, modestly higher sales realizations for domestic and export logs were offset by lower harvest volumes and seasonally higher logging and road costs.

1Q 2017 Outlook - Weyerhaeuser expects first quarter earnings and Adjusted EBITDA from the Timberlands segment will be comparable to the fourth quarter. In the South, the company anticipates lower fee harvest volumes, comparable log price realizations and a seasonal increase in forestry and silviculture expenses. In the West, the company expects modestly higher log sales volumes and improved average realizations due to higher export mix.

REAL ESTATE, ENERGY AND NATURAL RESOURCES

FINANCIAL HIGHLIGHTS (millions)

3Q 2016

   

4Q 2016

   

Change

Net sales

$

48

   

$

102

   

$

54

Contribution to pre-tax earnings

$

15

   

$

13

   

$

(2)

Pre-tax charge for special items

$

   

$

14

   

$

14

Contribution to pre-tax earnings before special items

$

15

   

$

27

   

$

12

Adjusted EBITDA

$

37

   

$

90

   

$

53

4Q 2016 Performance - Real Estate sales increased significantly compared with third quarter, and earnings from Energy and Natural Resources operations were modestly higher. Special items for the fourth quarter included $14 million of non-cash charges related to legacy real estate projects.

1Q 2017 Outlook - Weyerhaeuser expects a significant seasonal decline in earnings and Adjusted EBITDA in the first quarter compared with the fourth quarter due to lower real estate sales. The company anticipates full year 2017 Adjusted EBITDA for the segment will exceed $250 million.

WOOD PRODUCTS

FINANCIAL HIGHLIGHTS (millions)

3Q 2016

   

4Q 2016

   

Change

Net sales

$

1,194

   

$

1,039

   

$

(155)

Contribution to pre-tax earnings

$

170

   

$

99

   

$

(71)

Adjusted EBITDA

$

203

   

$

132

   

$

(71)

4Q 2016 Performance - Sales volumes declined seasonally across all product lines during the fourth quarter.  Average sales realizations for lumber were slightly lower and oriented strand board realizations were comparable to third quarter levels. Operating rates decreased primarily due to maintenance and planned downtime for the installation of capital projects.

1Q 2017 Outlook - Weyerhaeuser expects higher earnings and Adjusted EBITDA from the Wood Products segment in the first quarter. The company expects higher sales volumes, comparable sales realizations for lumber and oriented strand board, and seasonally improved operating rates and manufacturing costs.

DISCONTINUED OPERATIONS

Discontinued operations include the company's Cellulose Fibers segment, which consisted of pulp mills, a liquid packaging board facility, and a printing papers joint venture. Sales of the Cellulose Fibers pulp mills and printing papers business closed on December 1, 2016 and November 1, 2016 respectively.  The sale of the liquid packaging board business closed on August 31, 2016.

FINANCIAL HIGHLIGHTS (millions)

3Q 2016

   

4Q 2016

   

Change

Total net sales

$

420

   

$

231

   

$

(189)

Earnings from discontinued operations before income taxes

$

47

   

$

35

   

$

(12)

Income taxes

$

(23)

   

$

(51)

   

$

(28)

Net earnings (loss) from operations

$

24

   

$

(16)

   

$

(40)

Net gain on divestitures

$

41

   

$

505

   

$

464

Net earnings from discontinued operations

$

65

   

$

489

   

$

424

4Q 2016 Performance - Earnings increased primarily due to gains on the divestiture of the Cellulose Fibers pulp mills and printing papers business.

ABOUT WEYERHAEUSER
Weyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control over 13 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 products. Our company is a real estate investment trust. In February 2016, we merged with Plum Creek Timber Company, Inc. In 2016, we generated $6.4 billion in net sales and employed approximately 10,400 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 February 3 to discuss fourth quarter results.

To access the live webcast and presentation online, go to the Investor Relations section on www.weyerhaeuser.com on February 3.

To join the conference call from within North America, dial 877-296-9413 (access code: 43726350) at least 15 minutes prior to the call. Those calling from outside North America should dial 706-679-2458 (access code: 43726350). Replays will be available for two weeks at 855-859-2056 (access code: 43726350) from within North America and at 404-537-3406 (access code: 43726350) 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 "outlook," "expects," "may," "will," "believes," "should," "approximately," "anticipates," "estimates," "plans," or other similar words. In addition, these words may use the positive or negative or another variation of those and similar words.

This release contains forward-looking statements regarding the company's expectations during the first quarter of 2017, including with respect to: earnings and Adjusted EBITDA; cost and operational synergies from the merger with Plum Creek; log price realizations, log sales volumes and export mix, harvest volumes and silviculture expense; real estate sales volumes; and sales volumes, operating rates and manufacturing costs across Wood Products product lines and expected realizations for lumber and oriented strand board.

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

  • the effect of general economic conditions, including employment rates, interest rates, housing starts, general availability of financing for home mortgages and the relative strength of the U.S. dollar;
  • market demand for the company's products, including market demand for our timberland properties with higher and better uses, which is related to, among other factors, the strength of the various U.S. business segments and U.S. and international economic conditions;
  • performance of our manufacturing operations, including maintenance requirements;
  • potential disruptions in our manufacturing operations;
  • the level of competition from domestic and foreign producers;
  • our ability to successfully realize the expected benefits from the merger with Plum Creek;
  • the results of our strategic alternatives review of our operations in Uruguay;
  • raw material availability and prices;
  • the effect of weather;
  • the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters;
  • energy prices;
  • the successful execution of our internal plans and strategic initiatives,
  • transportation and labor 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 our common stock on charges for share-based compensation;
  • changes in accounting principles; and
  • other factors described under "Risk Factors" in our 2015 Annual Report on Form 10-K, our Registration Statement on Form S-4/A filed on December 23, 2015 and in our other filings from time to time with the Securities and Exchange Commission.

We are also a large exporter and our business is thus 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.

     

For more information contact:

 

Analysts - Beth Baum or Krista Kochivar (206) 539-3907

   

Media - Anthony Chavez (206) 539-4406

 
 

RECONCILIATION OF ADJUSTED EBITDA TO NET EARNINGS

 

We reconcile Adjusted EBITDA to net earnings for the consolidated company and to operating income for the business segments, as those are the most directly comparable U.S. GAAP measures for each.

 

The table below reconciles Adjusted EBITDA for the year ended December 31, 2016:

 

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

1,027

 

Earnings from discontinued operations, net of income taxes

               

(612)

 

Interest expense, net of capitalized interest

               

431

 

Income taxes

               

89

 

Net contribution to earnings

$

499

   

$

55

   

$

512

   

$

(131)

   

$

935

 

Equity (earnings) loss from joint ventures

   

(2)

   

   

(20)

   

(22)

 

Interest income and other

   

   

   

(43)

   

(43)

 

Operating income

499

   

53

   

512

   

(194)

   

870

 

Depreciation, depletion and amortization

366

   

13

   

129

   

4

   

512

 

Basis of real estate sold

   

109

   

   

   

109

 

Non-operating pension and postretirement credits

   

   

   

(43)

   

(43)

 

Special items(1)(2)

   

14

   

   

121

   

135

 

Adjusted EBITDA

$

865

   

$

189

   

$

641

   

$

(112)

   

$

1,583

 
 

(1) Pre-tax special items included in Real Estate & ENR relate to non-cash charges recorded for legacy real estate projects.

(2) Pre-tax special items included in Unallocated Items consist of:  $146 million Plum Creek merger-related costs, $36 million gain on sale of nonstrategic assets, and $11 million of legal expense.

 
 

The table below reconciles Adjusted EBITDA for the year ended December 31, 2015:

 

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

506

 

Earnings from discontinued operations, net of income taxes

               

(95)

 

Interest expense, net of capitalized interest

               

341

 

Income taxes

               

(58)

 

Net contribution to earnings

$

470

   

$

79

   

$

258

   

$

(113)

   

$

694

 

Equity (earnings) loss from joint ventures

   

   

   

   

 

Interest income and other

   

   

   

(36)

   

(36)

 

Operating income

470

   

79

   

258

   

(149)

   

658

 

Depreciation, depletion and amortization

208

   

1

   

106

   

10

   

325

 

Basis of real estate sold

   

18

   

   

   

18

 

Non-operating pension and postretirement credits

   

   

   

(11)

   

(11)

 

Special items(1)(2)

   

   

8

   

27

   

35

 

Adjusted EBITDA

$

678

   

$

98

   

$

372

   

$

(123)

   

$

1,025

 
 

(1) Pre-tax special items included in Wood Products are restructuring charges related to the closure of four distribution centers.

(2) Pre-tax special items included in Unallocated Items consist of a $13 million noncash impairment charge related to a nonstrategic asset that was sold in the second quarter and $14 million of Plum Creek merger-related costs.

 
 

The table below reconciles Adjusted EBITDA for the quarter ended December 31, 2016:

 

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

551

 

Earnings from discontinued operations, net of income taxes

               

(489)

 

Interest expense, net of capitalized interest

               

108

 

Income taxes

               

25

 

Net contribution to earnings

$

123

   

$

13

   

$

99

   

$

(40)

   

$

195

 

Equity (earnings) loss from joint ventures

   

(1)

   

   

   

(1)

 

Interest income and other

   

   

   

(9)

   

(9)

 

Operating income

123

   

12

   

99

   

(49)

   

185

 

Depreciation, depletion and amortization

100

   

4

   

33

   

   

137

 

Basis of real estate sold

   

60

   

   

   

60

 

Non-operating pension and postretirement credits

   

   

   

(10)

   

(10)

 

Special items(1)(2)

   

14

   

   

14

   

28

 

Adjusted EBITDA

$

223

   

$

90

   

$

132

   

$

(45)

   

$

400

 
 

(1) Pre-tax special items included in Real Estate & ENR relate to non-cash charges recorded for legacy real estate projects.

(2) Pre-tax special items included in Unallocated Items are Plum Creek merger-related costs.

 
 

The table below reconciles Adjusted EBITDA for the quarter ended September 30, 2016:

 

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

227

 

Earnings from discontinued operations, net of income taxes

               

(65)

 

Interest expense, net of capitalized interest

               

114

 

Income taxes

               

22

 

Net contribution to earnings

$

122

   

$

15

   

$

170

   

$

(9)

   

$

298

 

Equity (earnings) loss from joint ventures

   

(1)

   

   

(8)

   

(9)

 

Interest income and other

   

   

   

(15)

   

(15)

 

Operating income

122

   

14

   

170

   

(32)

   

274

 

Depreciation, depletion and amortization

101

   

4

   

33

   

   

138

 

Basis of real estate sold

   

19

   

   

   

19

 

Non-operating pension and postretirement credits

   

   

   

(11)

   

(11)

 

Special items(1)

   

   

   

14

   

14

 

Adjusted EBITDA

$

223

   

$

37

   

$

203

   

$

(29)

   

$

434

 
 

(1) Pre-tax special items include $14 million of Plum Creek merger-related costs.

 
 

The table below reconciles Adjusted EBITDA for the quarter ended December 31, 2015:

 

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

70

 

Earnings from discontinued operations, net of income taxes

               

16

 

Interest expense, net of capitalized interest

               

87

 

Income taxes

               

(22)

 

Net contribution to earnings

$

107

   

$

27

   

$

40

   

$

(23)

   

$

151

 

Equity (earnings) loss from joint ventures

   

   

   

   

 

Interest income and other

   

   

   

(9)

   

(9)

 

Operating income

107

   

27

   

40

   

(32)

   

142

 

Depreciation, depletion and amortization

53

   

1

   

27

   

1

   

82

 

Basis of real estate sold

   

5

   

   

   

5

 

Non-operating pension and postretirement credits

   

   

   

(3)

   

(3)

 

Special items(1)(2)

   

   

8

   

14

   

22

 

Adjusted EBITDA

$

160

   

$

33

   

$

75

   

$

(20)

   

$

248

 
 

(1) Pre-tax special items included in Wood Products are restructuring charges related to the closure of four distribution centers.

(2) Pre-tax special items included in Unallocated Items consist of Plum Creek merger-related costs.

 
 

Weyerhaeuser Company

Exhibit 99.2

Q4.2016 Analyst Package

Preliminary results (unaudited)

Consolidated Statement of Operations (1)(2)

 

in millions

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,

2016

 

Jun 30,

2016

 

Sep 30,

2016

 

Dec 31,

2016

 

Dec 31,

2015

 

Dec 31,

2016

 

Dec 31,
2015

Net Sales

$

1,405

 

$

1,655

 

$

1,709

 

$

1,596

 

$

1,266

 

$

6,365

 

$

5,246

Cost of products sold

1,089

 

1,258

 

1,314

 

1,265

 

998

 

4,926

 

4,121

Gross margin

316

 

397

 

395

 

331

 

268

 

1,439

 

1,125

Selling expenses

23

 

22

 

22

 

22

 

26

 

89

 

99

General and administrative expenses

76

 

94

 

78

 

84

 

75

 

332

 

259

Research and development expenses

5

 

4

 

5

 

5

 

6

 

19

 

18

Charges for integration and restructuring, closures and asset impairments

111

 

14

 

16

 

29

 

23

 

170

 

39

Other operating costs (income), net

(52)

 

5

 

 

6

 

(4)

 

(41)

 

52

Operating income from continuing operations

153

 

258

 

274

 

185

 

142

 

870

 

658

Equity earnings from joint ventures

5

 

7

 

9

 

1

 

 

22

 

Interest income and other

9

 

10

 

15

 

9

 

9

 

43

 

36

Interest expense, net of capitalized interest

(95)

 

(114)

 

(114)

 

(108)

 

(87)

 

(431)

 

(341)

Earnings from continuing operations before income taxes

72

 

161

 

184

 

87

 

64

 

504

 

353

Income taxes

(11)

 

(31)

 

(22)

 

(25)

 

22

 

(89)

 

58

Earnings from continuing operations

61

 

130

 

162

 

62

 

86

 

415

 

411

Earnings (loss) from discontinued operations, net of income taxes

20

 

38

 

65

 

489

 

(16)

 

612

 

95

Net earnings

81

 

168

 

227

 

551

 

70

 

1,027

 

506

Dividends on preference shares

(11)

 

(11)

 

 

 

(11)

 

(22)

 

(44)

Net earnings attributable to Weyerhaeuser common shareholders

$

70

 

$

157

 

$

227

 

$

551

 

$

59

 

$

1,005

 

$

462

 

(1)

Discontinued operations as presented herein consist of the operations of our Cellulose Fibers segment. The corresponding assets and liabilities were classified as held for sale on our balance sheet as of June 30, 2016. All periods presented have been revised to separate the results of discontinued operations from the results of our continuing operations. Detailed operating results of discontinued operations are presented on page 10.

   

(2)

Amounts presented reflect the balances and results of operations acquired in our merger with Plum Creek Timber, Inc., beginning on the merger date of February 19, 2016.

   

Per Share Information

 
 

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,
2016

 

Jun 30,

2016

 

Sep 30,
2016

 

Dec 31,

2016

 

Dec 31,
2015

 

Dec 31,

2016

 

Dec 31,

2015

Earnings per share attributable to Weyerhaeuser common shareholders, basic:

               

Continuing operations

$

0.08

   

$

0.16

   

$

0.22

   

$

0.09

   

$

0.15

   

$

0.55

   

$

0.71

 

Discontinued operations

0.03

   

0.05

   

0.08

   

0.65

   

(0.04)

   

0.85

   

0.18

 

Net earnings per share

$

0.11

   

$

0.21

   

$

0.30

   

$

0.74

   

$

0.11

   

$

1.40

   

$

0.89

 
                           

Earnings per share attributable to Weyerhaeuser common shareholders, diluted:

               

Continuing operations

$

0.08

   

$

0.16

   

$

0.21

   

$

0.08

   

$

0.15

   

$

0.55

   

$

0.71

 

Discontinued operations

0.03

   

0.05

   

0.09

   

0.65

   

(0.04)

   

0.84

   

0.18

 

Net earnings per share

$

0.11

   

$

0.21

   

$

0.30

   

$

0.73

   

$

0.11

   

$

1.39

   

$

0.89

 
                           

Dividends paid per common share

$

0.31

   

$

0.31

   

$

0.31

   

$

0.31

   

$

0.31

   

$

1.24

   

$

1.20

 
                           

Weighted average shares outstanding (in thousands):

                         

Basic

632,004

   

743,140

   

749,587

   

748,835

   

511,175

   

718,560

   

516,371

 

Diluted

634,872

   

747,701

   

754,044

   

752,768

   

514,167

   

722,401

   

519,618

 
                           

Common shares outstanding at end of period

(in thousands)

759,044

   

733,010

   

747,933

   

748,528

   

510,483

   

748,528

   

510,483

 

Weyerhaeuser Company

           

Q4.2016 Analyst Package

               

Preliminary results (unaudited)

               
                           

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization (Adjusted EBITDA)*

                           

in millions

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,

2016

 

Jun 30,

2016

 

Sep 30,

2016

 

Dec 31,

2016

 

Dec 31,

2015

 

Dec 31,

2016

 

Dec 31,

2015

Net earnings

$

81

   

$

168

   

$

227

   

$

551

   

$

70

   

$

1,027

   

$

506

 

(Earnings) loss from discontinued operations, net of tax

(20)

   

(38)

   

(65)

   

(489)

   

16

   

(612)

   

(95)

 

Equity earnings from joint ventures

(5)

   

(7)

   

(9)

   

(1)

   

   

(22)

   

 

Interest income and other

(9)

   

(10)

   

(15)

   

(9)

   

(9)

   

(43)

   

(36)

 

Interest expense, net of capitalized interest

95

   

114

   

114

   

108

   

87

   

431

   

341

 

Income taxes

11

   

31

   

22

   

25

   

(22)

   

89

   

(58)

 

Operating income from continuing operations

153

   

258

   

274

   

185

   

142

   

870

   

658

 

Depreciation, depletion and amortization

104

   

133

   

138

   

137

   

82

   

512

   

325

 

Basis of real estate sold

17

   

13

   

19

   

60

   

5

   

109

   

18

 

Non-operating pension and postretirement credits

(12)

   

(10)

   

(11)

   

(10)

   

(3)

   

(43)

   

(11)

 

Special items in operating income

74

   

19

   

14

   

28

   

22

   

135

   

35

 

Adjusted EBITDA*

$

336

   

$

413

   

$

434

   

$

400

   

$

248

   

$

1,583

   

$

1,025

 
                           

*Adjusted EBITDA is a non-GAAP measure that management uses to evaluate the performance of the company. Beginning in the first quarter of 2016, we revised our definition of Adjusted EBITDA to add back the basis of real estate sold. We have revised our prior-period presentation to conform to our current reporting.

 

Adjusted EBITDA, as we define it, is operating income from continuing operations adjusted for depreciation, depletion, amortization, basis of real estate sold, pension and postretirement costs not allocated to business segments and special items. Adjusted EBITDA excludes results from joint ventures.

 

Our definition of Adjusted EBITDA may be different from similarly titled measures reported by other companies. Adjusted EBITDA should not be considered in isolation from and is not intended to represent an alternative to our GAAP results.

                           

Special Items Included in Net Earnings (income tax affected)

                           

in millions

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,

2016

 

Jun 30,

2016

 

Sep 30,

2016

 

Dec 31,
2016

 

Dec 31,

2015

 

Dec 31,

2016

 

Dec 31,
2015

Net earnings attributable to Weyerhaeuser common shareholders

$

70

   

$

157

   

$

227

   

$

551

   

$

59

   

$

1,005

   

$

462

 

Plum Creek merger-and integration-related costs

98

   

4

   

10

   

11

   

14

   

123

   

14

 

Gain on sale of non-strategic asset

(22)

   

   

   

   

   

(22)

   

 

Legal expense

   

7

   

   

   

   

7

   

 

Restructuring, impairments and other charges

   

   

   

9

   

5

   

9

   

14

 

Tax adjustment

   

   

   

24

   

(13)

   

24

   

(13)

 

Net earnings attributable to Weyerhaeuser common shareholders before special items

146

   

168

   

237

   

595

   

65

   

1,146

   

477

 

(Earnings) loss from discontinued operations, net of tax

(20)

   

(38)

   

(65)

   

(489)

   

16

   

(612)

   

(95)

 

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

$

126

   

$

130

   

$

172

   

$

106

   

$

81

   

$

534

   

$

382

 
                           
 

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,

2016

 

Jun 30,

2016

 

Sep 30,

2016

 

Dec 31,

2016

 

Dec 31,

2015

 

Dec 31,
2016

 

Dec 31,
2015

Net earnings per diluted share attributable to Weyerhaeuser common shareholders

$

0.11

   

$

0.21

   

$

0.30

   

$

0.73

   

$

0.11

   

$

1.39

   

$

0.89

 

Plum Creek merger-and integration-related costs

0.15

   

   

0.02

   

0.01

   

0.03

   

0.17

   

0.03

 

Gain on sale of non-strategic asset

(0.03)

   

   

   

   

   

(0.03)

   

 

Legal expense

   

0.01

   

   

   

   

0.01

   

 

Restructuring, impairments and other charges

   

   

   

0.01

   

0.01

   

0.01

   

0.03

 

Tax adjustment

   

   

   

0.04

   

(0.03)

   

0.04

   

(0.03)

 

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

0.23

   

0.22

   

0.32

   

0.79

   

0.12

   

1.59

   

0.92

 

(Earnings) loss from discontinued operations, net of tax

(0.03)

   

(0.05)

   

(0.09)

   

(0.65)

   

0.04

   

(0.84)

   

(0.18)

 

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

$

0.20

   

$

0.17

   

$

0.23

   

$

0.14

   

$

0.16

   

$

0.75

   

$

0.74

 
               

Weyerhaeuser Company

       

Q4.2016 Analyst Package

           

Preliminary results (unaudited)

           

Consolidated Balance Sheet

                   

in millions

March 31,
 2016

 

June 30,
 2016

 

September 30,
 2016

 

December 31,
 2016

 

December 31,
 2015

     

ASSETS

                 

Current assets:

                 

Cash and cash equivalents

$

411

   

$

485

   

$

769

   

$

676

   

$

1,011

 

Receivables, less allowances

382

   

409

   

412

   

390

   

276

 

Receivables for taxes

25

   

7

   

5

   

84

   

30

 

Inventories

423

   

387

   

368

   

358

   

325

 

Prepaid expenses and other current assets

123

   

132

   

150

   

114

   

63

 

Assets of discontinued operations

1,929

   

1,908

   

1,652

   

   

1,934

 

Total current assets

3,293

   

3,328

   

3,356

   

1,622

   

3,639

 

Property and equipment, net

1,446

   

1,462

   

1,476

   

1,562

   

1,233

 

Construction in progress

151

   

172

   

202

   

213

   

144

 

Timber and timberlands at cost, less depletion charged to disposals

14,547

   

14,474

   

14,424

   

14,299

   

6,479

 

Minerals and mineral rights, net

325

   

319

   

321

   

319

   

14

 

Investments in and advances to equity affiliates

938

   

905

   

73

   

56

   

 

Goodwill

40

   

40

   

40

   

40

   

40

 

Deferred tax assets

291

   

250

   

122

   

293

   

254

 

Other assets

409

   

424

   

317

   

224

   

302

 

Restricted financial investments held by variable interest entities

615

   

615

   

615

   

615

   

615

 

Total assets

$

22,055

   

$

21,989

   

$

20,946

   

$

19,243

   

$

12,720

 
                   

LIABILITIES AND EQUITY

                 

Current liabilities:

                 

Current maturities of long-term debt

$

   

$

   

$

1,981

   

$

281

   

$

 

Notes payable

4

   

1

   

1

   

1

   

4

 

Accounts payable

284

   

300

   

234

   

233

   

204

 

Accrued liabilities

483

   

590

   

533

   

691

   

427

 

Liabilities of discontinued operations

674

   

666

   

578

   

   

690

 

Total current liabilities

1,445

   

1,557

   

3,327

   

1,206

   

1,325

 

Note payable to timberland venture

835

   

830

   

   

   

 

Long-term debt

7,715

   

8,013

   

6,329

   

6,329

   

4,787

 

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

511

   

511

   

511

   

511

   

511

 

Deferred pension and other postretirement benefits

983

   

926

   

875

   

1,322

   

987

 

Deposit received from contribution of timberlands to related party

   

437

   

429

   

426

   

 

Other liabilities

285

   

285

   

285

   

269

   

241

 

Total liabilities

11,774

   

12,559

   

11,756

   

10,063

   

7,851

 

Total equity

10,281

   

9,430

   

9,190

   

9,180

   

4,869

 

Total liabilities and equity

$

22,055

   

$

21,989

   

$

20,946

   

$

19,243

   

$

12,720

 

Weyerhaeuser Company

Q4.2016 Analyst Package

Preliminary results (unaudited)

Consolidated Statement of Cash Flows

                           

in millions

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,

2016

 

Jun 30,
2016

 

Sep 30,

2016

 

Dec 31,

2016

 

Dec 31,
2015

 

Dec 31,

2016

 

Dec 31,

2015

Cash flows from operations:

                         

Net earnings

$

81

   

$

168

   

$

227

   

$

551

   

$

70

   

$

1,027

   

$

506

 

Noncash charges (credits) to income:

                         

Depreciation, depletion and amortization

142

   

147

   

139

   

137

   

120

   

565

   

479

 

Basis of real estate sold

17

   

13

   

19

   

60

   

5

   

109

   

18

 

Deferred income taxes, net

18

   

38

   

40

   

(255)

   

(10)

   

(159)

   

 

Gains on sales of discontinued operations

   

   

(60)

   

(729)

   

   

(789)

   

 

Gains on sales of non-strategic assets

(41)

   

(10)

   

(10)

   

(12)

   

(8)

   

(73)

   

(38)

 

Pension and other postretirement benefits

4

   

1

   

   

   

10

   

5

   

42

 

Other noncash charges (credits)

8

   

26

   

13

   

27

   

103

   

74

   

198

 

Change in:

                         

Receivables less allowances

(47)

   

(43)

   

(6)

   

42

   

58

   

(54)

   

17

 

Receivable for taxes

10

   

25

   

2

   

69

   

(16)

   

106

   

(5)

 

Inventories

(43)

   

60

   

32

   

12

   

19

   

61

   

10

 

Prepaid expenses

(1)

   

   

(2)

   

8

   

5

   

5

   

3

 

Accounts payable and accrued liabilities

(70)

   

106

   

25

   

(50)

   

12

   

11

   

(35)

 

Pension and postretirement contributions

(17)

   

(12)

   

(54)

   

(16)

   

(24)

   

(99)

   

(83)

 

Distributions received from joint ventures

5

   

   

   

9

   

15

   

14

   

15

 

Other

(19)

   

(27)

   

(18)

   

(4)

   

(20)

   

(68)

   

(52)

 

Net cash from operations

47

   

492

   

347

   

(151)

   

339

   

735

   

1,075

 
                           

Cash flows from investing activities:

                         

Capital expenditures:

                         

Purchases of property and equipment

(57)

   

(83)

   

(120)

   

(191)

   

(167)

   

(451)

   

(443)

 

Timberlands reforestation costs

(16)

   

(18)

   

(9)

   

(16)

   

(7)

   

(59)

   

(40)

 

Acquisition of timberlands

(6)

   

(2)

   

(2)

   

   

(2)

   

(10)

   

(36)

 

Proceeds from sales of discontinued operations

   

   

285

   

2,201

   

   

2,486

   

 

Proceeds from sale of non-strategic assets

70

   

13

   

11

   

10

   

12

   

104

   

19

 

Proceeds from contribution of timberlands to related party

   

440

   

   

   

   

440

   

 

Other

33

   

   

52

   

(36)

   

1

   

49

   

13

 

Cash from (used in) investing activities

24

   

350

   

217

   

1,968

   

(163)

   

2,559

   

(487)

 
                           

Cash flows from financing activities:

                         

Cash dividends on common shares

(241)

   

(228)

   

(231)

   

(232)

   

(159)

   

(932)

   

(619)

 

Cash dividends on preference shares

   

(11)

   

(11)

   

   

(22)

   

(22)

   

(44)

 

Proceeds from issuance of long-term debt

1,098

   

300

   

300

   

   

   

1,698

   

 

Payments of long-term debt

(720)

   

(3)

   

   

(1,700)

   

   

(2,423)

   

 

Repurchase of common stock

(798)

   

(831)

   

(374)

   

   

(34)

   

(2,003)

   

(518)

 

Other

(7)

   

8

   

39

   

12

   

3

   

52

   

25

 

Cash from financing activities

(668)

   

(765)

   

(277)

   

(1,920)

   

(212)

   

(3,630)

   

(1,156)

 
                           

Net change in cash and cash equivalents

(597)

   

77

   

287

   

(103)

   

(36)

   

(336)

   

(568)

 
                           

Cash from continuing operations at beginning of period

$

1,011

   

$

411

   

$

485

   

$

769

   

$

1,046

   

$

1,011

   

1,577

 

Cash from discontinued operations at beginning of period

1

   

4

   

7

   

10

   

2

   

1

   

$

3

 

Cash and cash equivalents at beginning of period

$

1,012

   

$

415

   

$

492

   

$

779

   

$

1,048

   

$

1,012

   

$

1,580

 
                           

Cash from continuing operations at end of period

$

411

   

$

485

   

$

769

   

$

676

   

$

1,011

   

$

676

   

$

1,011

 

Cash from discontinued operations at end of period

4

   

7

   

10

   

   

1

   

   

1

 

Cash and cash equivalents at end of period

$

415

   

$

492

   

$

779

   

$

676

   

$

1,012

   

$

676

   

$

1,012

 
                           

Cash paid (received) during the year for:

                         

Interest, net of amount capitalized

$

133

   

$

92

   

$

142

   

$

79

   

$

57

   

$

446

   

$

347

 

Income taxes

$

(13)

   

$

(12)

   

$

(1)

   

$

511

   

$

10

   

$

485

   

$

14

 
                   

Weyerhaeuser Company

         

Total Company Statistics

Q4.2016 Analyst Package

               

Preliminary results (unaudited)

                   
 

Selected Total Company Items

 

in millions

Q1

 

Q2

 

Q3

 

Q4

 

Year-to-date

 

Mar 31,

2016

 

Jun 30,

2016

 

Sep 30,

2016

 

Dec 31,

2016

 

Dec 31,
2015

 

Dec 31,

2016

 

Dec 31,

2015

Pension and postretirement costs:

                         

Pension and postretirement costs allocated to business segments

$

7

   

$

8

   

$

8

   

$

7

   

$

9

   

$

30

   

$

36

 

Pension and postretirement costs (credits) not allocated

(12)

   

(10)

   

(11)

   

(10)

   

(3)

   

(43)

   

(11)

 

Accelerated pension costs included in Plum Creek merger-related costs (not allocated)

5

   

   

   

   

   

5

   

 

Total pension and postretirement costs for continuing operations

   

(2)

   

(3)

   

(3)

   

6

   

(8)

   

25

 

Pension and postretirement service costs directly attributable to discontinued operations

4

   

3

   

3

   

3

   

4

   

13

   

17

 

Total company pension and postretirement costs

$

4

   

$

1

   

$

   

$

   

$

10

   

$

5

   

$

42

 
                           

Cash spent for capital expenditures for continuing operations

$

(51)

   

$

(89)

   

$

(100)

   

$

(185)

   

$

(141)

   

$

(425)

   

$

(365)

 
             
             

Weyerhaeuser Company

         

Timberlands Segment

Q4.2016 Analyst Package

               

Preliminary results (unaudited)

                   
                             

Segment Statement of Operations

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Sales to unaffiliated customers

$

387

   

$

471

   

$

484

   

$

463

   

$

312

   

$

1,805

   

$

1,273

 

Intersegment sales

222

   

193

   

216

   

209

   

205

   

840

   

830

 

Total net sales

609

   

664

   

700

   

672

   

517

   

2,645

   

2,103

 

Cost of products sold

459

   

509

   

559

   

527

   

390

   

2,054

   

1,566

 

Gross margin

150

   

155

   

141

   

145

   

127

   

591

   

537

 

Selling expenses

1

   

2

   

1

   

1

   

1

   

5

   

5

 

General and administrative expenses

28

   

32

   

20

   

24

   

21

   

104

   

82

 

Research and development expenses

4

   

4

   

4

   

5

   

6

   

17

   

16

 

Charges for integration and restructuring, closures and asset impairments

   

   

   

   

   

   

 

Other operating income, net

(12)

   

(8)

   

(6)

   

(8)

   

(8)

   

(34)

   

(36)

 

Operating income and Net contribution to earnings

$

129

   

$

125

   

$

122

   

$

123

   

$

107

   

$

499

   

$

470

 
                             

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

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Operating income

$

129

   

$

125

   

$

122

   

$

123

   

$

107

   

$

499

   

$

470

 

Depreciation, depletion and amortization

70

   

95

   

101

   

100

   

53

   

366

   

208

 

Adjusted EBITDA*

$

199

   

$

220

   

$

223

   

$

223

   

$

160

   

$

865

   

$

678

 

* See definition of Adjusted EBITDA (a non-GAAP measure) on page 2.

                             

Selected Segment Items

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Total decrease (increase) in working capital(1)

$

(53)

   

$

28

   

$

(15)

   

$

20

   

$

4

   

$

(20)

   

$

18

 

Cash spent for capital expenditures

$

(20)

   

$

(31)

   

$

(26)

   

$

(39)

   

$

(17)

   

$

(116)

   

$

(75)

 

(1) Working capital does not include cash balances. Represents the change in combined working capital of Timberlands and Real Estate & ENR.

                             

Segment Statistics(2)

                             
 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Third Party
Net Sales
(millions)

Logs:

                         

West

$

215

   

$

232

   

$

217

   

$

201

   

$

203

   

$

865

   

$

830

 

South

101

   

154

   

160

   

151

   

61

   

566

   

241

 

North

13

   

19

   

29

   

30

   

   

91

   

 

Other

7

   

7

   

11

   

13

   

7

   

38

   

24

 

Total delivered logs

336

   

412

   

417

   

395

   

271

   

1,560

   

1,095

 

Stumpage and pay-as-cut timber

15

   

23

   

24

   

23

   

10

   

85

   

37

 

Products from international operations

16

   

21

   

21

   

21

   

18

   

79

   

87

 

Recreational and other lease revenue

6

   

8

   

15

   

15

   

7

   

44

   

25

 

Other revenue

14

   

7

   

7

   

9

   

6

   

37

   

29

 

Total

$

387

   

$

471

   

$

484

   

$

463

   

$

312

   

$

1,805

   

$

1,273

 

Delivered Logs

Third Party Sales

Realizations

(per ton)

West

$

100.71

   

$

98.21

   

$

98.18

   

$

100.43

   

$

101.54

   

$

99.32

   

$

101.12

 

South

$

36.39

   

$

35.54

   

$

35.27

   

$

34.98

   

$

36.87

   

$

35.46

   

$

37.13

 

North

$

59.31

   

$

65.43

   

$

59.17

   

$

59.28

   

$

   

$

60.47

   

$

 

International

$

15.73

   

$

23.29

   

$

24.27

   

$

25.72

   

$

16.60

   

$

21.79

   

$

18.01

 

Delivered Logs
Third Party Sales
Volumes
(tons, thousands)(3)

West

2,133

   

2,363

   

2,209

   

2,008

   

2,005

   

8,713

   

8,212

 

South

2,781

   

4,340

   

4,538

   

4,308

   

1,636

   

15,967

   

6,480

 

North

210

   

292

   

503

   

495

   

   

1,500

   

 

International

146

   

89

   

117

   

118

   

158

   

470

   

714

 

Other

169

   

169

   

263

   

342

   

167

   

943

   

551

 

Fee Harvest Volumes
(tons, thousands)(3)

West

2,801

   

2,980

   

2,744

   

2,558

   

2,596

   

11,083

   

10,563

 

South

5,030

   

7,061

   

6,992

   

7,260

   

3,565

   

26,343

   

14,113

 

North

260

   

454

   

678

   

652

   

   

2,044

   

 

International

299

   

248

   

242

   

330

   

255

   

1,119

   

980

 

Other

   

181

   

191

   

329

   

   

701

   

 

(2)

The Western region includes Washington and Oregon. The Southern region includes Virginia, North Carolina, South Carolina, Florida, Georgia, Alabama, Mississippi, Louisiana, Arkansas, Texas and Oklahoma. The Northern region includes West Virginia, Maine, New Hampshire, Vermont, Michigan, Wisconsin and Montana. Other includes our Canadian operations and managed Twin Creeks operations.

   

(3)

Beginning in first quarter 2016, we report log sales and fee harvest volumes in tons. Prior period volumes have been converted from cubic meters to tons using conversion factors as follows:

 

     West: 1.056 m3 = 1 ton

 

     South: 0.818 m3 = 1 ton

 

     Canada (in Other):  1.244 m3 = 1 ton

 

     International:  0.907 m3 = 1 ton

   

Weyerhaeuser Company

Real Estate, Energy and Natural Resources Segment

Q4.2016 Analyst Package

                 

Preliminary results (unaudited)

                     
                             

Segment Statement of Operations

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Sales to unaffiliated customers

$

39

   

$

38

   

$

48

   

$

101

   

$

32

   

$

226

   

$

101

 

Intersegment sales

   

   

   

1

   

   

1

   

 

Total net sales

39

   

38

   

48

   

102

   

32

   

227

   

101

 

Cost of products sold

20

   

19

   

26

   

69

   

5

   

134

   

20

 

Gross margin

19

   

19

   

22

   

33

   

27

   

93

   

81

 

Selling expenses

   

   

   

   

   

   

 

General and administrative expenses

4

   

8

   

7

   

7

   

3

   

26

   

6

 

Charges for integration, restructuring, closures and asset  impairments

   

1

   

   

14

   

   

15

   

 

Other operating income, net

   

(2)

   

1

   

   

(3)

   

(1)

   

(4)

 

Operating income

15

   

12

   

14

   

12

   

27

   

53

   

79

 

Equity earnings from joint ventures(1)

   

   

1

   

1

   

   

2

   

 

Net contribution to earnings

$

15

   

$

12

   

$

15

   

$

13

   

$

27

   

$

55

   

$

79

 

(1) Equity earnings (loss) from joint ventures attributed to the Real Estate and ENR segment are generated from our investments in our real estate development ventures.

                             

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

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Operating income

 

$

15

   

$

12

   

$

14

   

$

12

   

$

27

   

$

53

   

$

79

 

Depreciation, depletion and amortization

2

   

3

   

4

   

4

   

1

   

13

   

1

 

Basis of real estate sold

17

   

13

   

19

   

60

   

5

   

109

   

18

 

Special items

   

   

   

14

   

   

14

   

 

Adjusted EBITDA*

$

34

   

$

28

   

$

37

   

$

90

   

$

33

   

$

189

   

$

98

 

* See definition of Adjusted EBITDA (a non-GAAP measure) on page 2.

 

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

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Restructuring, impairments and other charges

$

   

$

   

$

   

$

(14)

   

$

   

$

(14)

   

$

 
 

Selected Segment Items

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Cash spent for capital expenditures

$

   

$

(1)

   

$

   

$

   

$

   

$

(1)

   

$

 
                             

Segment Statistics

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Net Sales

(millions)

Real Estate

$

30

   

$

26

   

$

31

   

$

85

   

$

25

   

$

172

   

$

75

 

Energy and natural resources

9

   

12

   

17

   

16

   

7

   

54

   

26

 

Total

$

39

   

$

38

   

$

48

   

$

101

   

$

32

   

$

226

   

$

101

 

Acres sold

Real Estate

15,225

   

10,020

   

12,853

   

44,589

   

6,765

   

82,687

   

27,390

 

Price per acre

Real Estate

$

1,980

   

$

2,555

   

$

2,354

   

$

1,903

   

$

3,450

   

$

2,072

   

$

2,490

 
                   

Weyerhaeuser Company

         

Wood Products Segment

Q4.2016 Analyst Package

               

Preliminary results (unaudited)

                   
                             

Segment Statement of Operations

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Sales to unaffiliated customers

$

979

   

$

1,146

   

$

1,177

   

$

1,032

   

$

922

   

$

4,334

   

$

3,872

 

Intersegment sales

22

   

22

   

17

   

7

   

21

   

68

   

82

 

Total net sales

1,001

   

1,168

   

1,194

   

1,039

   

943

   

4,402

   

3,954

 

Cost of products sold

862

   

957

   

980

   

889

   

841

   

3,688

   

3,487

 

Gross margin

139

   

211

   

214

   

150

   

102

   

714

   

467

 

Selling expenses

22

   

20

   

21

   

21

   

25

   

84

   

94

 

General and administrative expenses

27

   

30

   

24

   

28

   

28

   

109

   

102

 

Research and development expenses

1

   

   

1

   

   

   

2

   

2

 

Charges for restructuring, closures and impairments

1

   

4

   

1

   

1

   

9

   

7

   

10

 

Other operating income, net

1

   

1

   

(3)

   

1

   

   

   

1

 

Operating income and Net contribution to earnings

$

87

   

$

156

   

$

170

   

$

99

   

$

40

   

$

512

   

$

258

 
                             

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

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Operating income

$

87

   

$

156

   

$

170

   

$

99

   

$

40

   

$

512

   

$

258

 

Depreciation, depletion and amortization

30

   

33

   

33

   

33

   

27

   

129

   

106

 

Special items

   

   

   

   

8

   

   

8

 

Adjusted EBITDA*

$

117

   

$

189

   

$

203

   

$

132

   

$

75

   

$

641

   

$

372

 

* See definition of Adjusted EBITDA (a non-GAAP measure) on page 2.

                             

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

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Restructuring, impairments and other charges

$

   

$

   

$

   

$

   

$

(8)

   

$

   

$

(8)

 
                             

Selected Segment Items

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Total decrease (increase) in working capital(1)

$

(132)

   

$

35

   

$

49

   

$

32

   

$

79

   

$

(16)

   

$

45

 

Cash spent for capital expenditures

$

(29)

   

$

(52)

   

$

(71)

   

$

(145)

   

$

(122)

   

$

(297)

   

$

(287)

 

(1) Working capital does not include cash balances.

               
                             

Segment Statistics

                             

in millions, except for third-party sales realizations

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Structural Lumber
(board feet)

Third party net sales

$

419

   

$

498

   

$

495

   

$

427

   

$

402

   

$

1,839

   

$

1,741

 

Third party sales realizations

$

364

   

$

399

   

$

401

   

$

392

   

$

360

   

$

390

   

$

379

 

Third party sales volumes(2)

1,152

   

1,249

   

1,233

   

1,089

   

1,114

   

4,723

   

4,588

 

Production volumes

1,129

   

1,205

   

1,130

   

1,052

   

1,035

   

4,516

   

4,252

 

Engineered Solid
Section
(cubic feet)

Third party net sales

$

109

   

$

115

   

$

119

   

$

107

   

$

105

   

$

450

   

$

428

 

Third party sales realizations

$

1,971

   

$

1,922

   

$

1,916

   

$

1,930

   

$

1,987

   

$

1,934

   

$

2,008

 

Third party sales volumes(2)

5.5

   

6.0

   

6.2

   

5.6

   

5.3

   

23.3

   

21.3

 

Production volumes

5.6

   

5.9

   

5.7

   

5.6

   

5.1

   

22.8

   

20.9

 

Engineered
I-joists
(lineal feet)

Third party net sales

$

66

   

$

73

   

$

79

   

$

72

   

$

68

   

$

290

   

$

284

 

Third party sales realizations

$

1,507

   

$

1,471

   

$

1,475

   

$

1,485

   

$

1,515

   

$

1,484

   

$

1,512

 

Third party sales volumes(2)

44

   

50

   

53

   

48

   

45

   

195

   

188

 

Production volumes

46

   

46

   

49

   

43

   

44

   

184

   

185

 

Oriented Strand
Board
(square feet 3/8')

Third party net sales

$

163

   

$

182

   

199

   

$

163

   

$

160

   

$

707

   

$

595

 

Third party sales realizations

$

214

   

$

240

   

256

   

$

255

   

$

221

   

$

241

   

$

200

 

Third party sales volumes(2)

759

   

761

   

776

   

638

   

723

   

2,934

   

2,972

 

Production volumes

749

   

733

   

777

   

651

   

697

   

2,910

   

2,847

 

Softwood Plywood

(square feet 3/8')

Third party net sales

$

35

   

$

50

   

$

48

   

$

41

   

$

27

   

$

174

   

$

129

 

Third party sales realizations

$

317

   

$

382

   

$

378

   

$

364

   

$

308

   

$

368

   

$

339

 

Third party sales volumes(2)

110

   

131

   

127

   

113

   

91

   

481

   

381

 

Production volumes

88

   

111

   

105

   

92

   

57

   

396

   

248

 

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

                   

Weyerhaeuser Company

     

Unallocated Items

Q4.2016 Analyst Package

           

Preliminary results (unaudited)

               
                           

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, equity earnings from our Timberland Venture, and the LIFO reserve.

                           

Contribution to Earnings

                           

in millions

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Unallocated corporate function expenses

$

(17)

   

$

(24)

   

$

(21)

   

$

(25)

   

$

(16)

   

$

(87)

   

$

(64)

 

Unallocated share-based compensation

(2)

   

1

   

(4)

   

2

   

(4)

   

(3)

   

6

 

Unallocated pension & postretirement credits (costs)

12

   

10

   

11

   

10

   

3

   

43

   

11

 

Foreign exchange gains (losses)

13

   

1

   

(1)

   

(7)

   

(6)

   

6

   

(46)

 

Elimination of intersegment profit in inventory and LIFO

(6)

   

(2)

   

2

   

(12)

   

1

   

(18)

   

8

 

Gain on sale of non-strategic asset

36

   

8

   

1

   

5

   

4

   

50

   

6

 

Charges for integration and restructuring, closures, and asset impairments:

                         

     Plum Creek merger- and integration-related costs

(110)

   

(8)

   

(14)

   

(14)

   

(14)

   

(146)

   

(14)

 

     Other restructuring, closures and asset impairments

   

(1)

   

(1)

   

   

   

(2)

   

(15)

 

Other

(4)

   

(20)

   

(5)

   

(8)

   

   

(37)

   

(41)

 

Operating income (loss)

(78)

   

(35)

   

(32)

   

(49)

   

(32)

   

(194)

   

(149)

 

Equity earnings from joint venture(1)

5

   

7

   

8

   

   

   

20

   

 

Interest income and other

9

   

10

   

15

   

9

   

9

   

43

   

36

 

Net contribution to earnings

$

(64)

   

$

(18)

   

$

(9)

   

$

(40)

   

$

(23)

   

$

(131)

   

$

(113)

 

(1) Equity earning from joint venture included in Unallocated Items is generated from our investment in our timberland venture.

                           

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

                           

in millions

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Operating income (loss)

$

(78)

   

$

(35)

   

$

(32)

   

$

(49)

   

$

(32)

   

$

(194)

   

$

(149)

 

Depreciation, depletion and amortization

2

   

2

   

   

   

1

   

4

   

10

 

Non-operating pension and postretirement costs (credits)

(12)

   

(10)

   

(11)

   

(10)

   

(3)

   

(43)

   

(11)

 

Special items

74

   

19

   

14

   

14

   

14

   

121

   

27

 

Adjusted EBITDA*

$

(14)

   

$

(24)

   

$

(29)

   

$

(45)

   

$

(20)

   

$

(112)

   

$

(123)

 

* See definition of Adjusted EBITDA (a non-GAAP measure) on page 2.

                           

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

                           
 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Plum Creek merger-and integration-related costs

$

(110)

   

$

(8)

   

$

(14)

   

$

(14)

   

$

(14)

   

$

(146)

   

$

(14)

 

Gain on sale of non-strategic asset

36

   

   

   

   

   

36

   

 

Legal expense

   

(11)

   

   

   

   

(11)

   

 

Restructuring, impairments and other charges

   

   

   

   

   

   

(13)

 

Tax adjustments

   

   

   

   

   

   

 

Total

$

(74)

   

$

(19)

   

$

(14)

   

$

(14)

   

$

(14)

   

$

(121)

   

$

(27)

 
                           

Unallocated Selected Items

                           
 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Cash spent for capital expenditures

$

(2)

   

$

(5)

   

$

(3)

   

$

(1)

   

$

(2)

   

$

(11)

   

$

(3)

 
 

*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.

                   

Weyerhaeuser Company

         

Discontinued Operations

Q4.2016 Analyst Package

               

Preliminary results (unaudited)

                   
                             

Discontinued operations consist of our three Cellulose Fibers businesses, which were previously disclosed as a separate reportable business segment. On August 31, 2016, we completed the sale of the liquid packaging board business. On November 1, 2016, we completed the sale of our interest in a printing papers joint venture. On December 1, 2016, we completed the sale of our pulp business.

Discontinued Operations Statement of Operations

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Total net sales

$

430

   

$

456

   

$

420

   

$

231

   

$

475

   

$

1,537

   

$

1,860

 

Cost of products sold

386

   

374

   

350

   

173

   

392

   

1,283

   

1,573

 

Gross margin

44

   

82

   

70

   

58

   

83

   

254

   

287

 

Selling expenses

4

   

3

   

3

   

2

   

4

   

12

   

14

 

General and administrative expenses

9

   

8

   

7

   

5

   

9

   

29

   

30

 

Research and development expenses

1

   

2

   

   

2

   

1

   

5

   

6

 

Charges for integration and restructuring, closures and asset impairments

6

   

25

   

13

   

19

   

1

   

63

   

2

 

Other operating income, net

(9)

   

(10)

   

(2)

   

(6)

   

(7)

   

(27)

   

(26)

 

Operating income

33

   

54

   

49

   

36

   

75

   

172

   

261

 

Equity loss from joint venture

(2)

   

(1)

   

   

(1)

   

(87)

   

(4)

   

(105)

 

Interest expense, net of capitalized interest

(2)

   

(1)

   

(2)

   

   

(1)

   

(5)

   

(6)

 

Earnings from discontinued operations before income taxes

29

   

52

   

47

   

35

   

(13)

   

163

   

150

 

Income taxes

(9)

   

(14)

   

(23)

   

(51)

   

(3)

   

(97)

   

(55)

 

Net earnings from operations

20

   

38

   

24

   

(16)

   

(16)

   

66

   

95

 

Net gain on divestitures

   

   

41

   

505

   

   

546

   

 

Net earnings from discontinued operations

$

20

   

$

38

   

$

65

   

$

489

   

$

(16)

   

$

612

   

$

95

 
                             

Discontinued Operations Selected Items

                             

in millions

 

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Depreciation, depletion and amortization

$

38

   

$

15

   

$

   

$

   

$

38

   

$

53

   

$

154

 

Cash spent for capital expenditures

$

(22)

   

$

(12)

   

$

(29)

   

$

(22)

   

$

(33)

   

$

(85)

   

$

(118)

 
                             

Segment Statistics

                             
   

Q1.2016

 

Q2.2016

 

Q3.2016

 

Q4.2016

 

Q4.2015

 

YTD.2016

 

YTD.2015

Pulp

(air-dry metric tons)

Third party net sales (millions)

$

351

   

$

350

   

$

349

   

$

231

   

$

388

   

$

1,281

   

$

1,499

 

Third party sales realizations

$

755

   

$

762

   

$

780

   

$

788

   

$

800

   

$

770

   

$

823

 

Third party sales volumes (thousands)

464

   

460

   

446

   

293

   

484

   

1,663

   

1,821

 

Production volumes (thousands)

457

   

454

   

426

   

311

   

481

   

1,648

   

1,822

 

Liquid

Packaging

Board

(metric tons)

Third party net sales (millions)

$

67

   

$

85

   

$

61

   

$

   

$

73

   

$

213

   

$

305

 

Third party sales realizations

$

1,068

   

$

1,127

   

$

1,144

   

$

   

$

1,203

   

$

1,112

   

$

1,196

 

Third party sales volumes (thousands)

63

   

76

   

53

   

   

61

   

192

   

255

 

Production volumes (thousands)

64

   

65

   

48

   

   

63

   

177

   

255

 

 

 

 

 

SOURCE Weyerhaeuser Company


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