News Room

Print News Release

Weyerhaeuser reports second quarter results

-- Net earnings increased 18% compared with first quarter

-- Earnings before special items increased 21% compared with first quarter and 57% compared with one year ago

-- Highest Wood Products EBITDA on record

Jul 27, 2018

SEATTLE, July 27, 2018 /PRNewswire/ -- Weyerhaeuser Company (NYSE: WY) today reported second quarter net earnings of $317 million, or 42 cents per diluted share, on net sales of $2.1 billion. This compares with earnings of $24 million, or 3 cents per diluted share, on net sales of $1.8 billion for the same period last year.

Weyerhaeuser Company logo. (PRNewsFoto/Weyerhaeuser Company)

View our earnings release and financial statements in a printer-friendly PDF.

Excluding net after-tax special charges of $15 million, the company reported net earnings of $332 million, or 44 cents per diluted share for the second quarter. This compares with net earnings before special items of $212 million for the same period last year and $275 million for the first quarter of 2018.  Adjusted EBITDA for the second quarter was $637 million compared with $506 million for the second quarter of last year and $544 million for the first quarter of 2018.

"I am very pleased with our second quarter financial results, as each of our businesses delivered solid operational performance and capitalized on market conditions to drive strong year-over-year improvement, including the highest Wood Products EBITDA on record," said Doyle R. Simons, president and chief executive officer. "In addition, we delivered Weyerhaeuser's highest EBITDA since 2006, when the company's operations were nearly three times larger than they are today. Looking forward, housing market fundamentals remain strong, and we remain relentlessly focused on driving operational excellence and fully capitalizing on market conditions to drive value for shareholders."

WEYERHAEUSER FINANCIAL HIGHLIGHTS

2018

 

2018

 

2017

(millions, except per share data)

Q1

 

Q2

 

Q2

Net sales

$1,865

 

$2,065

 

$1,808

Net earnings

$269

 

$317

 

$24

Net earnings per diluted share

$0.35

 

$0.42

 

$0.03

Weighted average shares outstanding, diluted

759

 

761

 

756

Net earnings before special items(1)

$275

 

$332

 

$212

Net earnings per diluted share before special items

$0.36

 

$0.44

 

$0.28

Adjusted EBITDA(2)

$544

 

$637

 

$506

           

 

(1)

First quarter 2018 after-tax special items include charges of $21 million for environmental remediation and a $15 million benefit from product remediation insurance proceeds. Second quarter 2018 special items include $15 million of net after-tax charges for product remediation. Second quarter 2017 after-tax special items include a $147 million non-cash impairment charge for the Uruguay business, and charges of $31 million for product remediation, $8 million for countervailing and antidumping duties on Canadian softwood lumber the company sold into the United States and $2 million for Plum Creek merger-related costs. Beginning first quarter 2018, these duties are no longer reported as a special item.

 

(2)

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, adjusted for depreciation, depletion, amortization, basis of real estate sold, unallocated pension service costs 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

2018

 

2018

   

(millions)

Q1

 

Q2

 

Change

Net sales

$733

 

$667

 

($66)

Contribution to pre-tax earnings

$189

 

$161

 

($28)

Adjusted EBITDA

$268

 

$240

 

($28)

2Q 2018 Performance - In the South, log sales volumes were comparable with the first quarter and average realizations declined slightly due to a greater proportion of pulpwood sales. Unit logging costs increased seasonally due to additional thinning activity. In the West, slightly higher average log sales realizations were more than offset by seasonally higher forestry, road and unit logging costs. Fuel costs increased in both regions.

3Q 2018 Outlook - Weyerhaeuser expects third quarter earnings and Adjusted EBITDA will be lower than the second quarter, but slightly higher than the third quarter of 2017. The company anticipates seasonally higher road and forestry costs and higher fuel and unit logging costs. In the West, average sales realizations are expected to be slightly lower than the second quarter and fee harvest volumes will be comparable. In the South, the company anticipates higher fee harvest volumes and comparable average log sales realizations.

 

REAL ESTATE, ENERGY & NATURAL RESOURCES

           

FINANCIAL HIGHLIGHTS

2018

 

2018

   

(millions)

Q1

 

Q2

 

Change

Net sales

$51

 

$58

 

$7

Contribution to pre-tax earnings

$25

 

$22

 

($3)

Adjusted EBITDA

$41

 

$47

 

$6

2Q 2018 Performance - Real Estate sales increased slightly compared with the first quarter and Energy and Natural Resources royalties were modestly higher. Adjusted EBITDA increased, but earnings were slightly lower due to a higher average land basis on the mix of properties sold.

3Q 2018 Outlook - Weyerhaeuser anticipates third quarter earnings and Adjusted EBITDA will be higher than the second quarter. We continue to expect full year 2018 Adjusted EBITDA for the segment will be approximately $250 million.

 

WOOD PRODUCTS

           

FINANCIAL HIGHLIGHTS

2018

 

2018

   

(millions)

Q1

 

Q2

 

Change

Net sales

$1,309

 

$1,525

 

$216

Contribution to pre-tax earnings

$270

 

$329

 

$59

Pre-tax charge (benefit) for special items

($20)

 

$20

 

$40

Contribution to pre-tax earnings before special items

$250

 

$349

 

$99

Adjusted EBITDA

$286

 

$385

 

$99

2Q 2018 Performance - Average sales realizations for lumber and oriented strand board improved significantly compared with the first quarter, and engineered wood products realizations increased modestly. Sales volumes rose seasonally for all product lines. These factors were partially offset by higher log, raw material and transportation costs.

Second quarter special items consist of a $20 million net pre-tax charge for finalization of product remediation costs.

3Q 2018 Outlook - Weyerhaeuser expects earnings before special items and Adjusted EBITDA will decrease compared with the second quarter. The company anticipates moderately lower average sales realizations for lumber and oriented strand board. As previously disclosed, sales volumes for oriented strand board will be lower due to an extended outage at our Grayling, Michigan mill for a scheduled press replacement.

           

UNALLOCATED

           

FINANCIAL HIGHLIGHTS

2018

 

2018

   

(millions)

Q1

 

Q2

 

Change

Contribution to pre-tax earnings

($92)

 

($38)

 

$54

Pre-tax charge for special items

$28

 

$ -

 

($28)

Contribution to pre-tax earnings before special items

($64)

 

($38)

 

$26

Adjusted EBITDA

($51)

 

($35)

 

$16

2Q 2018 Performance - Second quarter results include a small non-cash benefit from elimination of intersegment profit in inventory and LIFO due to reduced log and lumber inventories. This compares with a charge in the first quarter. Non-cash non-operating pension and post-retirement expense also decreased due to finalization of measurements of year-end pension plan assets and liabilities.

ABOUT WEYERHAEUSER

Weyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control 12.4 million acres of timberlands 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 2017, we generated $7.2 billion in net sales and employed approximately 9,300 people who serve customers worldwide. We are listed on the North American and World Dow Jones Sustainability Indices. 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 July 27, 2018, to discuss second quarter results.

To access the live webcast and presentation online, go to the Investor Relations section on www.weyerhaeuser.com  on July 27, 2018.

To join the conference call from within North America, dial 855-223-0757 (access code: 5882807) at least 15 minutes prior to the call. Those calling from outside North America should dial 574-990-1206 (access code: 5882807). Replays will be available for two weeks at 855-859-2056 (access code: 5882807) from within North America and at 404-537-3406 (access code: 5882807) 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, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934, including without limitation with respect to the following for the third quarter of 2018: earnings and Adjusted EBITDA for each of our Timber and Real Estate, Energy & Natural Resources business segments; earnings before special items and Adjusted EBITDA for our Wood Products business segment; log sales realizations, fee harvest volumes, road and forestry costs and fuel and unit logging costs in our timber business; and sales realizations for lumber and oriented strand board and sales volumes for oriented strand board for our Wood Products business. These statements generally are identified by words such as "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," and expressions such as "will be," "will continue," "will likely result," and similar words and expressions. These statements are based on our current expectations and assumptions and are not guarantees of future performance.  The realization of our expectations and the accuracy of our assumptions are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to:

  • the effect of general economic conditions, including employment rates, interest rate levels, housing starts, availability of financing for home mortgages and strength of the U.S. dollar;
  • market demand for our 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;
  • changes in currency exchange rates, particularly the relative value of the U.S. dollar to the yen and the Canadian dollar, and the relative value of the euro to the yen;
  • restrictions on international trade, tariffs imposed on imports and the availability and cost of shipping and transportation;
  • economic activity in Asia, especially Japan and China;
  • performance of our manufacturing operations, including maintenance requirements;
  • potential disruptions in our manufacturing operations;
  • the level of competition from domestic and foreign producers;
  • 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, including restructuring and cost reduction initiatives;
  • the successful and timely execution and integration of our strategic acquisitions, including our ability to realize expected benefits and synergies, and the successful and timely execution of our strategic divestitures, each of which is subject to a number of risks and conditions beyond our control including, but not limited to, timing and required regulatory approvals;
  • 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 matters described under "Risk Factors" in our 2017 Annual Report on Form 10-K, as well as those set forth from time to time in our other public statements and other reports and filings with the Securities and Exchange Commission.

Forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise.

For more information contact:
Analysts - Beth Baum, 206-539-3907
Media - Nancy Thompson, 919-861-0342

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 quarter ended March 31, 2018:

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

269

 

Interest expense, net of capitalized interest

               

93

 

Income taxes

               

30

 

Net contribution to earnings

$

189

   

$

25

   

$

270

   

$

(92)

   

$

392

 

Non-operating pension and other postretirement benefit costs

   

   

   

24

   

24

 

Interest income and other

   

   

   

(12)

   

(12)

 

Operating income (loss)

189

   

25

   

270

   

(80)

   

404

 

Depreciation, depletion and amortization

79

   

4

   

36

   

1

   

120

 

Basis of real estate sold

   

12

   

   

   

12

 

Special items(1)(2)

   

   

(20)

   

28

   

8

 

Adjusted EBITDA

$

268

   

$

41

   

$

286

   

$

(51)

   

$

544

 
 

(1)

Pre-tax special items attributable to Wood Products include a $20 million benefit from product remediation insurance proceeds.

 

(2)

Pre-tax special items included in Unallocated Items consist of charges of $28 million for environmental remediation.

The table below reconciles Adjusted EBITDA for the quarter ended June 30, 2018:

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

317

 

Interest expense, net of capitalized interest

               

92

 

Income taxes

               

65

 

Net contribution to earnings

$

161

   

$

22

   

$

329

   

$

(38)

   

$

474

 

Non-operating pension and other postretirement benefit costs

   

   

   

13

   

13

 

Interest income and other

   

   

   

(11)

   

(11)

 

Operating income (loss)

161

   

22

   

329

   

(36)

   

476

 

Depreciation, depletion and amortization

79

   

3

   

36

   

1

   

119

 

Basis of real estate sold

   

22

   

   

   

22

 

Special items(1)

   

   

20

   

   

20

 

Adjusted EBITDA

$

240

   

$

47

   

$

385

   

$

(35)

   

$

637

 
 

(1)

Pre-tax special items included in Wood Products consist of net charges of $20 million for finalization of product remediation costs.

The table below reconciles Adjusted EBITDA for the quarter ended June 30, 2017:

DOLLAR AMOUNTS IN MILLIONS

Timberlands

 

Real Estate
& ENR

 

Wood
Products

 

Unallocated
Items

 

Total

Adjusted EBITDA by Segment:

                 

Net earnings

               

$

24

 

Interest expense, net of capitalized interest

               

100

 

Income taxes

               

34

 

Net contribution to earnings

$

(12)

   

$

23

   

$

177

   

$

(30)

   

$

158

 

Non-operating pension and other postretirement benefit costs

   

   

   

8

   

8

 

Interest income and other

   

   

   

(9)

   

(9)

 

Operating income (loss)

(12)

   

23

   

177

   

(31)

   

157

 

Depreciation, depletion and amortization

87

   

4

   

36

   

2

   

129

 

Basis of real estate sold

   

10

   

   

   

10

 

Special items(1)

147

   

   

61

   

2

   

210

 

Adjusted EBITDA

$

222

   

$

37

   

$

274

   

$

(27)

   

$

506

 
 

(1)

Pre-tax special items include $147 million of impairment charges related to our Uruguayan operations; $50 million for product remediation; $11 million of countervailing and antidumping duties; and $2 million of Plum Creek merger-related costs.

   
   
   

 

Weyerhaeuser Company

Exhibit 99.2

Q2.2018 Analyst Package

 

Preliminary results (unaudited)

                   

Consolidated Statement of Operations

                   

in millions

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Net sales

$

1,865

   

$

2,065

   

$

1,808

   

$

3,930

   

$

3,501

 

Cost of products sold

1,348

   

1,447

   

1,336

   

2,795

   

2,608

 

Gross margin

517

   

618

   

472

   

1,135

   

893

 

Selling expenses

23

   

23

   

22

   

46

   

44

 

General and administrative expenses

78

   

80

   

76

   

158

   

163

 

Research and development expenses

2

   

2

   

4

   

4

   

8

 

Charges for integration and restructuring, closures and asset impairments

2

   

   

151

   

2

   

164

 

Charges (recoveries) for product remediation, net

(20)

   

20

   

50

   

   

50

 

Other operating costs (income), net

28

   

17

   

12

   

45

   

14

 

Operating income

404

   

476

   

157

   

880

   

450

 

Non-operating pension and other postretirement benefit costs

(24)

   

(13)

   

(8)

   

(37)

   

(30)

 

Interest income and other

12

   

11

   

9

   

23

   

18

 

Interest expense, net of capitalized interest

(93)

   

(92)

   

(100)

   

(185)

   

(199)

 

Earnings before income taxes

299

   

382

   

58

   

681

   

239

 

Income taxes

(30)

   

(65)

   

(34)

   

(95)

   

(58)

 

Net earnings

$

269

   

$

317

   

$

24

   

$

586

   

$

181

 
 

Per Share Information

 
 

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Earnings per share, basic and diluted

$

0.35

   

$

0.42

   

$

0.03

   

$

0.77

   

$

0.24

 

Dividends paid per common share

$

0.32

   

$

0.32

   

$

0.31

   

$

0.64

   

$

0.62

 

Weighted average shares outstanding (in thousands):

                 

Basic

756,815

   

757,829

   

752,630

   

757,317

   

751,674

 

Diluted

759,462

   

760,533

   

756,451

   

759,992

   

755,625

 

Common shares outstanding at end of period (in thousands)

756,700

   

757,646

   

752,711

   

757,646

   

752,711

 
 

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

 

in millions

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Net earnings

$

269

   

$

317

   

$

24

   

$

586

   

$

181

 

Non-operating pension and other postretirement benefit costs

24

   

13

   

8

   

37

   

30

 

Interest income and other

(12)

   

(11)

   

(9)

   

(23)

   

(18)

 

Interest expense, net of capitalized interest

93

   

92

   

100

   

185

   

199

 

Income taxes

30

   

65

   

34

   

95

   

58

 

Operating income

404

   

476

   

157

   

880

   

450

 

Depreciation, depletion and amortization

120

   

119

   

129

   

239

   

262

 

Basis of real estate sold

12

   

22

   

10

   

34

   

24

 

Unallocated pension service costs

   

   

   

   

2

 

Special items

8

   

20

   

210

   

28

   

222

 

Adjusted EBITDA*

$

544

   

$

637

   

$

506

   

$

1,181

   

$

960

 
                   

*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 adjusted for depreciation, depletion, amortization, basis of real estate sold, unallocated pension service costs, 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.

 
 
 

 

Weyerhaeuser Company

Total Company Statistics

Q2.2018 Analyst Package

     

Preliminary results (unaudited)

 
                   

Special Items Included in Net Earnings (Income Tax Affected)

                   

in millions

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Net earnings

$

269

   

$

317

   

$

24

   

$

586

   

$

181

 

Plum Creek merger and integration-related costs

   

   

2

   

   

12

 

Restructuring, impairment and other charges

   

   

147

   

   

147

 

Environmental remediation charges (recoveries)

21

   

   

   

21

   

 

Countervailing and antidumping duties charges (credits)(1)

   

   

8

   

   

8

 

Product remediation charges (recoveries), net

(15)

   

15

   

31

   

   

31

 

Net earnings before special items

$

275

   

$

332

   

$

212

   

$

607

   

$

379

 
                   
                   
                   
 

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Net earnings per diluted share

$

0.35

   

$

0.42

   

$

0.03

   

$

0.77

   

$

0.24

 

Plum Creek merger and integration-related costs

   

   

   

   

0.02

 

Restructuring, impairment and other charges

   

   

0.20

   

   

0.19

 

Environmental remediation charges (recoveries)

0.03

   

   

   

0.03

   

 

Countervailing and antidumping duties charges (credits)(1)

   

   

0.01

   

   

0.01

 

Product remediation charges (recoveries), net

(0.02)

   

0.02

   

0.04

   

   

0.04

 

Net earnings per diluted share before special items

$

0.36

   

$

0.44

   

$

0.28

   

$

0.80

   

$

0.50

 

(1)As of first quarter 2018, countervailing and antidumping duties are no longer reported as a special item.

                   
                   
 

Selected Total Company Items

 

in millions

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Pension and postretirement costs:

                 

Pension and postretirement service costs

$

10

   

$

8

   

$

7

   

$

18

   

$

17

 

Non-operating pension and other postretirement benefit costs

24

   

13

   

8

   

37

   

30

 

Total company pension and postretirement costs

$

34

   

$

21

   

$

15

   

$

55

   

$

47

 

 

 

       
       
       

Weyerhaeuser Company

 

Q2.2018 Analyst Package

Preliminary results (unaudited)

   

Consolidated Balance Sheet

           

in millions

March 31,
 2018

 

June 30,
 2018

 

December 31,
 2017

 

ASSETS

         

Current assets:

         

Cash and cash equivalents

$

598

   

$

901

   

$

824

 

Receivables, less discounts and allowances

481

   

491

   

396

 

Receivables for taxes

24

   

23

   

14

 

Inventories

445

   

414

   

383

 

Prepaid expenses and other current assets

118

   

146

   

98

 

Current restricted financial investments held by variable interest entities

253

   

253

   

 

Total current assets

1,919

   

2,228

   

1,715

 

Property and equipment, net

1,573

   

1,597

   

1,618

 

Construction in progress

275

   

282

   

225

 

Timber and timberlands at cost, less depletion

12,888

   

12,790

   

12,954

 

Minerals and mineral rights, less depletion

306

   

302

   

308

 

Goodwill

40

   

40

   

40

 

Deferred tax assets

244

   

168

   

268

 

Other assets

278

   

279

   

316

 

Restricted financial investments held by variable interest entities

362

   

362

   

615

 

Total assets

$

17,885

   

$

18,048

   

$

18,059

 
           

LIABILITIES AND EQUITY

         

Current liabilities:

         

Current maturities of long-term debt

$

   

$

   

$

62

 

Current debt (nonrecourse to the company) held by variable interest entities

209

   

209

   

209

 

Accounts payable

245

   

270

   

249

 

Accrued liabilities

457

   

543

   

645

 

Total current liabilities

911

   

1,022

   

1,165

 

Long-term debt

5,928

   

5,924

   

5,930

 

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

302

   

302

   

302

 

Deferred pension and other postretirement benefits

1,454

   

1,224

   

1,487

 

Other liabilities

299

   

295

   

276

 

Total liabilities

8,894

   

8,767

   

9,160

 

Total equity

8,991

   

9,281

   

8,899

 

Total liabilities and equity

$

17,885

   

$

18,048

   

$

18,059

 
       
       
       

Weyerhaeuser Company

   

Q2.2018 Analyst Package

 

Preliminary results (unaudited)

         

Consolidated Statements of Cash Flows

                   

in millions

Q1

 

Q2

 

Year-to-Date

 

March 31,
 2018

 

June 30,
 2018

 

June 30,
 2017

 

June 30,
 2018

 

June 30,
 2017

Cash flows from operations:

                 

Net earnings

$

269

   

$

317

   

$

24

   

$

586

   

$

181

 

Noncash charges (credits) to income:

                 

Depreciation, depletion and amortization

120

   

119

   

129

   

239

   

262

 

Basis of real estate sold

12

   

22

   

10

   

34

   

24

 

Deferred income taxes, net

10

   

15

   

3

   

25

   

6

 

Pension and other postretirement benefits

34

   

21

   

15

   

55

   

47

 

   Share-based compensation expense

9

   

9

   

9

   

18

   

19

 

   Charges for impairments of assets

1

   

   

147

   

1

   

147

 

Change in:

                 

Receivables, less allowances

(83)

   

(18)

   

(8)

   

(101)

   

(78)

 

Receivables and payables for taxes

5

   

10

   

(17)

   

15

   

(53)

 

Inventories

(66)

   

30

   

21

   

(36)

   

(7)

 

Prepaid expenses

(5)

   

4

   

(4)

   

(1)

   

(13)

 

Accounts payable and accrued liabilities

(173)

   

103

   

192

   

(70)

   

55

 

Pension and postretirement benefit contributions and payments

(16)

   

(16)

   

(15)

   

(32)

   

(37)

 

Other

19

   

(19)

   

(17)

   

   

(29)

 

Net cash from operations

$

136

   

$

597

   

$

489

   

$

733

   

$

524

 

Cash flows from investing activities:

                 

Capital expenditures for property and equipment

$

(61)

   

$

(83)

   

$

(74)

   

$

(144)

   

$

(126)

 

Capital expenditures for timberlands reforestation

(20)

   

(14)

   

(13)

   

(34)

   

(36)

 

Proceeds from sale of nonstrategic assets

2

   

   

4

   

2

   

12

 

Other

3

   

24

   

45

   

27

   

44

 

Cash from (used in) investing activities

$

(76)

   

$

(73)

   

$

(38)

   

$

(149)

   

$

(106)

 

Cash flows from financing activities:

                 

Cash dividends on common shares

$

(242)

   

$

(243)

   

$

(233)

   

$

(485)

   

$

(466)

 

Payments of long-term debt

(62)

   

   

   

(62)

   

 

Proceeds from exercise of stock options

25

   

23

   

26

   

48

   

81

 

Other

(7)

   

(1)

   

2

   

(8)

   

(8)

 

Cash from (used in) financing activities

$

(286)

   

$

(221)

   

$

(205)

   

$

(507)

   

$

(393)

 
                   

Net change in cash and cash equivalents

$

(226)

   

$

303

   

$

246

   

$

77

   

$

25

 

Cash and cash equivalents at beginning of period

824

   

598

   

455

   

824

   

676

 

Cash and cash equivalents at end of period

$

598

   

$

901

   

$

701

   

$

901

   

$

701

 
                   

Cash paid during the period for:

                 

Interest, net of amount capitalized

$

105

   

$

67

   

$

72

   

$

172

   

$

192

 

Income taxes

$

17

   

$

41

   

$

47

   

$

58

   

$

106

 
       
       
       

Weyerhaeuser Company

Timberlands Segment

 

Q2.2018 Analyst Package

     

Preliminary results (unaudited)

   

Segment Statement of Operations

 

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Sales to unaffiliated customers

$

505

   

$

482

   

$

469

   

$

987

   

$

955

   

Intersegment sales

228

   

185

   

163

   

413

   

365

   

Total net sales

733

   

667

   

632

   

1,400

   

1,320

   

Cost of products sold

526

   

485

   

476

   

1,011

   

995

   

Gross margin

207

   

182

   

156

   

389

   

325

   

Selling expenses

1

   

   

1

   

1

   

2

   

General and administrative expenses

23

   

25

   

23

   

48

   

47

   

Research and development expenses

2

   

1

   

4

   

3

   

7

   

Charges for integration and restructuring, closures and asset impairments

   

   

147

   

   

147

   

Other operating costs (income), net

(8)

   

(5)

   

(7)

   

(13)

   

(14)

   

Operating income and Net contribution to earnings

$

189

   

$

161

   

$

(12)

   

$

350

   

$

136

   
   
   

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

 

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Operating income

$

189

   

$

161

   

$

(12)

   

$

350

   

$

136

   

Depreciation, depletion and amortization

79

   

79

   

87

   

158

   

181

   

Special items

   

   

147

   

   

147

   

Adjusted EBITDA*

$

268

   

$

240

   

$

222

   

$

508

   

$

464

   

*See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

         
   
   

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

 

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Restructuring, impairment and other charges

$

   

$

   

$

(147)

   

$

   

$

(147)

   
   
   

Selected Segment Items

 

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Total decrease (increase) in working capital(1)

$

(40)

   

$

70

   

$

(5)

   

$

30

   

$

(42)

   

Cash spent for capital expenditures

$

(28)

   

$

(29)

   

$

(25)

   

$

(57)

   

$

(55)

   

(1) Represents the change in prepaid assets, accounts receivable, accounts payable, accrued liabilities and log inventory for the Timberlands and Real Estate & ENR segments combined.

   
   

Segment Statistics(2)(3)

 
 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Third Party
Net Sales
(millions)

Delivered logs:

                   

  West

$

266

   

$

262

   

$

227

   

$

528

   

$

452

   

  South

157

   

158

   

148

   

315

   

296

   

  North

25

   

20

   

16

   

45

   

43

   

  Other

14

   

7

   

11

   

21

   

31

   

Total delivered logs

462

   

447

   

402

   

909

   

822

   

Stumpage and pay-as-cut timber

15

   

11

   

17

   

26

   

29

   

Products from international operations

   

   

21

   

   

40

   

Recreational and other lease revenue

14

   

15

   

15

   

29

   

29

   

Other revenue

14

   

9

   

14

   

23

   

35

   

Total

$

505

   

$

482

   

$

469

   

$

987

   

$

955

   

Delivered Logs

Third Party Sales

Realizations (per ton)

West

$

131.59

   

$

132.24

   

$

105.84

   

$

131.91

   

$

105.06

   

South

$

34.83

   

$

34.55

   

$

34.48

   

$

34.69

   

$

34.48

   

North

$

60.79

   

$

64.92

   

$

63.49

   

$

62.59

   

$

60.97

   

Delivered Logs

Third Party Sales

Volumes

(tons, thousands)

West

2,019

   

1,984

   

2,143

   

4,003

   

4,300

   

South

4,510

   

4,560

   

4,285

   

9,070

   

8,578

   

North

404

   

313

   

253

   

717

   

707

   

Other

317

   

81

   

292

   

398

   

802

   

Fee Harvest Volumes

(tons, thousands)

West

2,443

   

2,360

   

2,652

   

4,803

   

5,309

   

South

6,751

   

6,630

   

6,473

   

13,381

   

12,846

   

North

549

   

423

   

383

   

972

   

1,005

   

Other

   

   

444

   

   

815

   

(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 (our management agreement for the Twin Creeks Venture began in April 2016 and terminated in December 2017).

 
   

(3) Western logs are primarily transacted in MBF but are converted to ton equivalents for external reporting purposes.

 
   
   
   

Weyerhaeuser Company

 

Real Estate, Energy and Natural
Resources Segment

 

Q2.2018 Analyst Package

   

Preliminary results (unaudited)

     
             

Segment Statement of Operations

 
   

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Net sales

$

51

   

$

58

   

$

46

   

$

109

   

$

99

   

Cost of products sold

19

   

30

   

16

   

49

   

36

   

Gross margin

32

   

28

   

30

   

60

   

63

   

General and administrative expenses

7

   

6

   

7

   

13

   

14

   

Other operating costs (income), net

   

   

   

   

   

Operating income and net contribution to earnings

$

25

   

$

22

   

$

23

   

$

47

   

$

49

   
   
   

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

 
   

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Operating income

$

25

   

$

22

   

$

23

   

$

47

   

$

49

   

Depreciation, depletion and amortization

4

   

3

   

4

   

7

   

7

   

Basis of real estate sold

12

   

22

   

10

   

34

   

24

   

Adjusted EBITDA*

$

41

   

$

47

   

$

37

   

$

88

   

$

80

   

*See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

         
   
   

Selected Segment Items

 
   

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Cash spent for capital expenditures

$

   

$

   

$

(1)

   

$

   

$

(1

   
   
   

Segment Statistics

 
   
 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

 

Net Sales
(millions)

Real Estate

$

34

   

$

38

   

$

27

   

$

72

   

$

64

   

Energy and Natural Resources

17

   

20

   

19

   

37

   

35

   

Total

$

51

   

$

58

   

$

46

   

$

109

   

$

99

   

Acres Sold

Real Estate

21,771

   

16,290

   

10,003

   

38,061

   

23,260

   

Price per Acre

Real Estate

$

1,539

   

$

2,258

   

$

2,714

   

$

1,847

   

$

2,537

   

 

               
               
               

Weyerhaeuser Company

     

Wood Products Segment

Q2.2018 Analyst Package

     

Preliminary results (unaudited)

 
                     

Segment Statement of Operations

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Net sales

$

1,309

   

$

1,525

   

$

1,293

   

$

2,834

   

$

2,447

 

Cost of products sold

1,005

   

1,119

   

1,002

   

2,124

   

1,928

 

Gross margin

304

   

406

   

291

   

710

   

519

 

Selling expenses

21

   

22

   

19

   

43

   

40

 

General and administrative expenses

34

   

31

   

32

   

65

   

64

 

Research and development expenses

   

1

   

   

1

   

1

 

Charges for integration and restructuring, closures and asset impairments

2

   

   

2

   

2

   

3

 

Charges (recoveries) for product remediation, net

(20)

   

20

   

   

   

 

Other operating costs (income), net

(3)

   

3

   

61

   

   

62

 

Operating income and Net contribution to earnings

$

270

   

$

329

   

$

177

   

$

599

   

$

349

 
 
 

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

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Operating income

$

270

   

$

329

   

$

177

   

$

599

   

$

349

 

Depreciation, depletion and amortization

36

   

36

   

36

   

72

   

71

 

Special items

(20)

   

20

   

61

   

   

61

 

Adjusted EBITDA*

$

286

   

$

385

   

$

274

   

$

671

   

$

481

 

*See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

       
 
 

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

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Countervailing and antidumping duties (charges) credits(1)

$

   

$

   

$

(11)

   

$

   

$

(11)

 

Product remediation (charges) recoveries, net

20

   

(20)

   

(50)

   

   

(50)

 

Total

$

20

   

$

(20)

   

$

(61)

   

$

   

$

(61)

 

(1) As of first quarter 2018, countervailing and antidumping duties are no longer reported as a special item.

 
 

Selected Segment Items

in millions

 

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Total decrease (increase) in working capital(2)

$

(226)

   

$

3

   

$

113

   

$

(223)

   

$

(9)

 

Cash spent for capital expenditures

$

(52)

   

$

(68)

   

$

(61)

   

$

(120)

   

$

(105)

 

(2) Represents the change in prepaid assets, accounts receivable, accounts payable, accrued liabilities and inventory for the Wood Products segment.

 

Segment Statistics

in millions, except for third party sales realizations

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Structural Lumber
(volumes presented

in board feet)

Third party net sales

$

569

   

$

681

   

$

538

   

$

1,250

   

$

1,016

 

Third party sales realizations

$

498

   

$

541

   

$

441

   

$

521

   

$

427

 

Third party sales volumes(3)

1,140

   

1,261

   

1,218

   

2,401

   

2,376

 

Production volumes

1,160

   

1,180

   

1,146

   

2,340

   

2,298

 

Engineered Solid
Section
(volumes presented

in cubic feet)

Third party net sales

$

129

   

$

139

   

$

130

   

$

268

   

$

247

 

Third party sales realizations

$

2,088

   

$

2,156

   

$

1,979

   

$

2,123

   

$

1,931

 

Third party sales volumes(3)

6.2

   

6.4

   

6.6

   

12.6

   

12.8

 

Production volumes

6.3

   

6.4

   

6.6

   

12.7

   

12.9

 

Engineered
I-joists
(volumes presented

in lineal feet)

Third party net sales

$

78

   

$

92

   

$

85

   

$

170

   

$

158

 

Third party sales realizations

$

1,585

   

$

1,630

   

$

1,522

   

$

1,609

   

$

1,503

 

Third party sales volumes(3)

49

   

57

   

57

   

106

   

106

 

Production volumes

56

   

52

   

53

   

108

   

103

 

Oriented Strand
Board
(volumes presented

in square feet 3/8")

Third party net sales

$

232

   

$

277

   

$

225

   

$

509

   

$

428

 

Third party sales realizations

$

314

   

$

367

   

$

295

   

$

341

   

$

279

 

Third party sales volumes(3)

739

   

754

   

764

   

1,493

   

1,533

 

Production volumes

734

   

747

   

754

   

1,481

   

1,512

 

Softwood Plywood

(volumes presented

in square feet 3/8")

Third party net sales

$

50

   

$

55

   

$

47

   

$

105

   

$

91

 

Third party sales realizations

$

438

   

$

461

   

$

380

   

$

450

   

$

379

 

Third party sales volumes(3)

115

   

118

   

123

   

233

   

241

 

Production volumes

97

   

105

   

99

   

202

   

196

 

Medium Density
Fiberboard 
(volumes presented

in square feet 3/4")

Third party net sales

$

43

   

$

47

   

$

51

   

$

90

   

$

98

 

Third party sales realizations

$

839

   

$

839

   

$

845

   

$

839

   

$

820

 

Third party sales volumes(3)

51

   

55

   

60

   

106

   

119

 

Production volumes

50

   

57

   

63

   

107

   

119

 

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

 

 

Weyerhaeuser Company

     

Unallocated Items

Q2.2018 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 expense, pension and postretirement costs, foreign exchange transaction gains and losses and the elimination of intersegment profit in inventory and LIFO.

 

Contribution to Earnings

 

in millions

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Unallocated corporate function and variable compensation expense

$

(18)

   

$

(19)

   

$

(17)

   

$

(37)

   

$

(36)

 

Liability classified share-based compensation

   

(2)

   

   

(2)

   

(6)

 

Foreign exchange gains (losses)

(2)

   

2

   

   

   

(3)

 

Elimination of intersegment profit in inventory and LIFO

(21)

   

3

   

(3)

   

(18)

   

(9)

 

Charges for integration and restructuring, closures and asset impairments

   

   

(2)

   

   

(14)

 

Other

(39)

   

(20)

   

(9)

   

(59)

   

(16)

 

Operating income (loss)

(80)

   

(36)

   

(31)

   

(116)

   

(84)

 

Non-operating pension and other postretirement benefit (costs) credits

(24)

   

(13)

   

(8)

   

(37)

   

(30

 

Interest income and other

12

   

11

   

9

   

23

   

18

 

Net contribution to earnings

$

(92)

   

$

(38)

   

$

(30)

   

$

(130)

   

$

(96)

 
 

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

 

in millions

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Operating income (loss)

$

(80)

   

$

(36)

   

$

(31)

   

$

(116)

   

$

(84)

 

Depreciation, depletion and amortization

1

   

1

   

2

   

2

   

3

 

Unallocated pension service costs

   

   

   

   

2

 

Special items

28

   

   

2

   

28

   

14

 

Adjusted EBITDA*

$

(51)

   

$

(35)

   

$

(27)

   

$

(86)

   

$

(65)

 

*See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

   
 

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

 

in millions

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Plum Creek merger and integration-related costs

$

   

$

   

$

(2)

   

$

   

$

(14)

 

Environmental remediation insurance (charges) recoveries

(28)

   

   

   

(28)

   

 

Total

$

(28)

   

$

   

$

(2)

   

$

(28)

   

$

(14)

 
 

Unallocated Selected Items

 

in millions

Q1.2018

 

Q2.2018

 

Q2.2017

 

YTD.2018

 

YTD.2017

Cash spent for capital expenditures

$

(1)

   

$

   

$

   

$

(1)

   

$

(1)

 

 

 

SOURCE Weyerhaeuser Company


Top
Welcome to Weyerhaeuser's new website!

You appear to be using an older browser. This website is best viewed using the latest versions of Internet Explorer, Chrome, Safari, and Firefox. If you proceed without upgrading or switching browsers, you may not experience optimal navigation or page functionality. Thank you for your interest in Weyerhaeuser and we hope you enjoy your visit.

Update my browser now

×