Newsroom
Weyerhaeuser Reports Net Earnings of $733 Million for 2005, Or $2.98 Per Diluted Share, on Net Sales of $22.6 Billion
PRNewswire-FirstCall
FEDERAL WAY, Wash.
Feb 3, 2006
Weyerhaeuser Company (NYSE: WY) today reported net earnings of $733 million for 2005, or $2.98 per diluted share, on net sales of $22.6 billion. This compares with net earnings of $1.3 billion, or $5.43 per diluted share, on net sales of $21.9 billion for the full year 2004.
(Logo: http://www.newscom.com/cgi-bin/prnh/20040116/WYLOGO-a http://www.newscom.com/cgi-bin/prnh/20040116/WYLOGO-b )
For the fourth quarter 2005, Weyerhaeuser reported a net loss of $211 million, or 86 cents per diluted share, on net sales of $5.9 billion. Last year, Weyerhaeuser reported fourth quarter net earnings of $199 million, or 82 cents per diluted share, on net sales of $5.7 billion.
The loss for fourth quarter 2005 included the following after-tax items:
-- Charges of $438 million, or $1.78 per diluted share, for closure of
facilities.
-- Charges of $32 million, or 13 cents per diluted share, for additional
asset impairment charges.
-- A charge of $25 million, or 10 cents per diluted share, associated with
the settlement of litigation.
-- A loss of $10 million, or 4 cents per diluted share, for early
extinguishment of debt.
-- A gain of $34 million, or 13 cents per diluted share, on the sale of
the company's French composite panels assets.
-- Income of $28 million, or 12 cents per diluted share, for the
cumulative effect of a change to begin capitalizing Weyerhaeuser
interest to assets of Weyerhaeuser Real Estate Company.
Fourth quarter 2004 earnings include the following after-tax items:
-- A loss of $34 million, or 14 cents per diluted share, for early
extinguishment of debt.
-- A gain of $24 million, or 10 cents per diluted share, for gains on the
sale of facilities.
-- A charge of $19 million, or 8 cents per diluted share, for the
impairment of assets in the company's French composite panels business.
-- A charge of $16 million, or 7 cents per diluted share, recognized in
connection with a change in the method of estimating workers'
compensation liabilities.
-- A charge of $15 million, or 6 cents per diluted share, for the net book
value of technology donated to a university.
During 2005, Weyerhaeuser's ongoing strategic review resulted in the following significant actions:
-- Selling its British Columbia coastal operations and French composite
panels business and a laminated beam facility;
-- Announcing its intention to sell its North American and Irish composite
panels assets, a pulp facility, three corrugated sheet plants and a
specialty packaging plant; and
-- Closing a paper facility, a specialty pulp mill, a fine paper machine,
a containerboard machine, a large-log sawmill, seven corrugated
converting plants, two hardwood facilities, a bag plant, an I-joist
facility and a veneer and plywood facility.
"Despite extremely challenging business conditions, we took significant steps in 2005 to make us more competitive and position us to generate greater returns while returning cash to shareholders," said Steven R. Rogel, chairman, president and chief executive officer. "Our strong cash flow allowed us to pay down debt to our target levels, implement a 25 percent increase in our dividend and initiate a stock buy back program. We also began reorganizing our wood products, containerboard and packaging businesses into integrated supply chains and continued to grow our real estate business. In 2006, we will continue to confront the challenges our businesses face with the goal of creating a stronger company."
SUMMARY OF FOURTH QUARTER FINANCIAL HIGHLIGHTS
Millions (except per share data) 4Q 2005 4Q 2004 Change
Net earnings (loss) ($211) $199 ($410)
Earnings (loss) per diluted share ($0.86) $0.82 ($1.68)
Net sales $5,868 $5,685 $183
SUMMARY OF ANNUAL FINANCIAL HIGHLIGHTS
Millions (except per share data) 2005 2004 Change
Net earnings $733 $1,283 ($550)
Earnings per diluted share $2.98 $5.43 ($2.45)
Net sales $22,629 $21,931 $698
SEGMENT RESULTS FOR FOURTH QUARTER
(Contributions to Pre-Tax Earnings)
Millions 4Q 2005 4Q 2004 Change
Timberlands $183 $217 ($34)
Wood Products $26 $72 ($46)
Cellulose Fiber and White Papers ($477) $35 ($512)
Containerboard, Packaging and
Recycling ($188) $81 ($269)
Real Estate and Related Assets $250 $217 $33
TIMBERLANDS
4Q 2005 3Q 2005 Change
Contribution to pre-tax
earnings (millions) $183 $191 ($8)
Fourth quarter earnings decreased slightly from the third quarter due primarily to salvage costs associated with hurricane Katrina and continued high fuel costs for logging and hauling. Fourth quarter results also include $3 million of pre-tax timberland severance costs due to the announced closure of the Prince Albert pulp and paper facility in Saskatchewan, Canada.
The continued strength of domestic and export log prices should produce first quarter earnings that are similar to fourth quarter 2005.
WOOD PRODUCTS
4Q 2005 3Q 2005 Change
Contribution to pre-tax earnings
(millions) $26 $124 ($98)
Earnings in the fourth quarter include $91 million of pre-tax charges associated with the closure of a plywood mill at Wright City, Oklahoma, the closure of a lumber mill at Aberdeen, Washington, and the potential closure of a lumber mill at Big River, Saskatchewan. Third quarter earnings included $6 million of pre-tax charges associated with facility closures.
Excluding the charges, earnings decreased $13 million from the third quarter. Demand for structural panels increased following the hurricanes and caused panel prices to surge early in the quarter, but panel prices returned to normal seasonal levels late in the quarter. Prices and volume for softwood lumber declined due to seasonal factors. Shipment volumes for engineered lumber products also declined on average from the third quarter.
Manufacturing costs for panels increased in the fourth quarter largely due to a significant rise in natural gas prices. Manufacturing costs for engineered lumber products increased due to the higher prices for oriented strand board.
The company incurred $16 million in countervailing and anti-dumping duties and related costs on Canadian softwood lumber the company sold into the United States in the fourth quarter, compared with $19 million in the third quarter. Starting in December, the company is paying a combined duty rate of 13.1 percent, down from the 25.9 percent rate that was in effect since December 2004. At this new rate, the segment expects to incur approximately $10 million per quarter in duties and related costs.
Weyerhaeuser expects lower first quarter 2006 earnings compared with fourth quarter 2005 earnings before special charges. During the first quarter, demand for wood products should follow the normal seasonal trends with pricing remaining similar to fourth quarter levels. The company expects manufacturing expenses to increase due to higher energy and raw material costs.
CELLULOSE FIBER AND WHITE PAPERS
4Q 2005 3Q 2005 Change
Contribution (charge) to pre-tax
earnings (millions) ($477) ($2) ($475)
In the fourth quarter, Weyerhaeuser recorded $427 million of pre-tax charges related to the announced closures of the Prince Albert pulp and paper operations and a paper machine at Dryden. Manufacturing costs continued to escalate due to higher energy, freight, chemical and raw material costs. Prices for fine paper and pulp remained unchanged. Fine paper volumes increased modestly while pulp experienced a normal seasonal decline in shipments.
Announced first quarter price increases for market pulp and fine paper should result in improved earnings in the first quarter 2006 despite continued cost pressures.
CONTAINERBOARD, PACKAGING AND RECYCLING
4Q 2005 3Q 2005 Change
Contribution (charge) to pre-tax
earnings (millions) ($188) $36 ($224)
Fourth quarter earnings include a pre-tax charge of $130 million related to the closure of several facilities and a pre-tax charge of $38 million related to a settlement of linerboard antitrust lawsuits. Earnings, excluding charges, decreased significantly from the third quarter due to lower box prices coupled with higher energy and transportation costs. Costs for old corrugated containers (OCC) were lower in fourth quarter.
The company expects higher pricing, increased box shipments and lower OCC costs to result in improved first quarter earnings for the segment.
REAL ESTATE AND RELATED ASSETS
4Q 2005 3Q 2005 Change
Contribution to pre-tax
earnings (millions) $250 $145 $105
Fourth quarter earnings increased from third quarter primarily due to the expected strong single-family home closings and higher single-family margins, partially offset by a $33 million pre-tax impairment charge related to unimproved land in Northern California.
The backlog of homes sold, but not closed, at the end of the fourth quarter was comparable to year-ago levels. Weyerhaeuser expects lower first quarter 2006 earnings due to a normal seasonal decline in single-family home closings.
OTHER
The company will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on Feb. 3 to discuss the fourth quarter results.
To access the conference call, listeners calling from within North America should dial 1-888-221-5699 at least 15 minutes before the start of the conference call. Those wishing to access the call from outside North America should dial 1-706-643-3795. Replays of the call will be available for one week following completion of the live call and can be accessed at 1-800-642-1687 (access code - 3890458) within North America and at 1-706-645-9291 (access code - 3890458) from outside North America.
The call is being web cast and can be accessed through Weyerhaeuser's Internet site at http://investor.weyerhaeuser.com/ by clicking on the "Q4 2005 Earnings Conference Call" link.
The web cast also is being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.fulldisclosure.com, Thomson/CCBN's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected event management site, StreetEvents (www.streetevents.com).
Weyerhaeuser Company, one of the world's largest integrated forest products companies, was incorporated in 1900. In 2005, sales were $22.6 billion. It has offices or operations in 18 countries, with customers worldwide. Weyerhaeuser is principally engaged in the growing and harvesting of timber; the manufacture, distribution and sale of forest products; and real estate construction, development and related activities. Additional information about Weyerhaeuser's businesses, products and practices is available at http://www.weyerhaeuser.com/ .
This news release contains statements concerning the company's future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Some of these forward-looking statements can be identified by the use of forward-looking terminology such as "expects," "may," "will," "believes," "should," "approximately," anticipates," "estimates," and "plans," and the negative or other variations of those terms or comparable terminology or by discussions of strategy, plans or intentions. In particular, some of these forward-looking statements deal with expectations regarding the company's markets in the first quarter 2006; expected earnings and performance of the company's business segments during the first quarter 2006, demand and pricing for the company's products in the first quarter 2006, higher raw material, energy, chemical, transportation and manufacturing costs in the first quarter 2006, seasonal slowdowns in single-family home closings in the first quarter of 2006, and related matters. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to:
-- The effect of general economic conditions, including the level of
interest rates and housing starts;
-- Market demand for the company's products, which may be tied to the
relative strength of various U.S. business segments;
-- Energy prices;
-- Raw material prices;
-- Chemical prices;
-- Performance of the company's manufacturing operations;
-- The successful execution of internal performance plans;
-- The level of competition from domestic and foreign producers;
-- The effect of forestry, land use, environmental and other governmental
regulations, and changes in accounting regulations;
-- The effect of weather;
-- The risk of loss from fires, floods and other natural disasters;
-- Transportation costs;
-- Legal proceedings; and
-- Performance of pension fund investments and related derivatives.
The company is also a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan, and by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the Euro and the Canadian dollar, and restrictions on international trade or tariffs imposed on imports, including the countervailing and anti-dumping duties imposed on the company's softwood lumber shipments from Canada to the United States. These and other factors could cause or contribute to actual results differing materially from such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will occur, or if any of them occurs, what effect they will have on the company's results of operations or financial condition. The company expressly declines any obligation to publicly revise any forward-looking statements that have been made to reflect the occurrence of events after the date of this news release.
For more information contact: Media - Bruce Amundson 253-924-3047
Analysts - Kathryn McAuley 253-924-2058
WEYERHAEUSER COMPANY
STATISTICAL INFORMATION (unaudited)
CONSOLIDATED EARNINGS Q1 Q2
(in millions) March 27, March 28, June 26, June 27,
2005 2004 2005 2004
Net sales and revenues:
Weyerhaeuser (1) $4,716 $4,418 $5,160 $5,179
Real Estate and Related Assets 655 469 648 524
Total net sales and revenues 5,371 4,887 5,808 5,703
Costs and expenses:
Weyerhaeuser:
Costs of products sold 3,621 3,408 3,947 3,766
Depreciation, depletion and
amortization 323 315 325 316
Selling expenses 117 119 118 121
General and administrative
expenses 223 238 217 233
Research and development expenses 14 12 12 13
Taxes other than payroll and
income taxes 46 48 48 47
Charges for integration and
restructuring 5 15 4 13
Charges for closure of facilities 5 4 3 --
Other operating costs, net (2) (3) 9 17 (40) 43
4,363 4,176 4,634 4,552
Real Estate and Related Assets:
Costs and operating expenses 426 321 441 381
Depreciation and amortization 3 2 4 4
Selling expenses 33 27 36 30
General and administrative
expenses 24 17 25 19
Taxes other than payroll and
income taxes 1 1 -- --
Other operating costs, net -- 1 (2) 1
Impairment of long-lived assets -- -- -- --
487 369 504 435
Total costs and expenses 4,850 4,545 5,138 4,987
Operating income 521 342 670 716
Interest expense and other:
Weyerhaeuser:
Interest expense incurred (4) (196) (195) (179) (218)
Less interest capitalized -- 3 2 1
Interest income and other 27 3 20 5
Equity in income (loss) of
affiliates (5) -- -- 4 7
Real Estate and Related Assets:
Interest expense incurred (14) (15) (14) (14)
Less interest capitalized 14 15 14 14
Interest income and other 5 11 (2) 9
Equity in income of unconsolidated
entities 10 9 13 20
Earnings before income taxes 367 173 528 540
Income taxes (6) (128) (57) (229) (183)
Earnings from continuing operations 239 116 299 357
Earnings from discontinued operations,
net of taxes (7) -- 5 121 12
Net earnings $239 $121 $420 $369
Basic net earnings per share:
Continuing operations $0.98 $0.52 $1.23 $1.52
Discontinued operations -- 0.02 0.49 0.05
Net earnings per share $0.98 $0.54 $1.72 $1.57
Diluted net earnings per share:
Continuing operations $0.98 $0.52 $1.22 $1.52
Discontinued operations -- 0.02 0.49 0.05
Net earnings per share $0.98 $0.54 $1.71 $1.57
Dividends paid per share $0.40 $0.40 $0.50 $0.40
Weighted average shares outstanding
(in thousands)
Basic 242,863 223,728 244,702 234,494
Diluted 244,185 225,072 245,881 235,475
CONSOLIDATED EARNINGS Q3 Q4
(in millions) Sept. 25, Sept. 26, Dec. 25, Dec. 26,
2005 2004 2005 2004
Net sales and revenues:
Weyerhaeuser (1) $4,986 $5,065 $4,852 $4,774
Real Estate and Related Assets 596 591 1,016 911
Total net sales and revenues 5,582 5,656 5,868 5,685
Costs and expenses:
Weyerhaeuser:
Costs of products sold 3,912 3,735 3,980 3,706
Depreciation, depletion and
amortization 327 314 332 318
Selling expenses 118 122 108 119
General and administrative
expenses 236 225 223 246
Research and development expenses 18 13 17 17
Taxes other than payroll and
income taxes 69 51 16 48
Charges for integration and
restructuring 2 8 10 3
Charges for closure of facilities 29 13 656 0
Other operating costs, net (2) (3) (32) (300) 3 7
4,679 4,181 5,345 4,464
Real Estate and Related Assets:
Costs and operating expenses 401 414 677 647
Depreciation and amortization 4 3 5 5
Selling expenses 36 31 46 37
General and administrative
expenses 27 19 28 26
Taxes other than payroll and
income taxes 1 1 1 --
Other operating costs, net (2) (19) 1 --
Impairment of long-lived assets -- -- 33 --
467 449 791 715
Total costs and expenses 5,146 4,630 6,136 5,179
Operating income 436 1,026 (268) 506
Interest expense and other:
Weyerhaeuser:
Interest expense incurred (4) (193) (184) (171) (241)
Less interest capitalized 3 0 4 5
Interest income and other 143 7 24 9
Equity in income (loss) of
affiliates (5) 2 4 (12) 3
Real Estate and Related Assets:
Interest expense incurred (13) (14) (14) (14)
Less interest capitalized 13 14 14 14
Interest income and other 4 1 5 10
Equity in income of unconsolidated
entities 14 12 20 11
Earnings before income taxes 409 866 (398) 303
Income taxes (6) (120) (293) 153 (94)
Earnings from continuing operations 289 573 (245) 209
Earnings from discontinued operations,
net of taxes (7) (4) 21 34 (10)
Net earnings $285 $594 $(211) $199
Basic net earnings per share:
Continuing operations $1.17 $2.37 $(1.00) $0.86
Discontinued operations (0.01) 0.09 0.14 (0.04)
Net earnings per share $1.16 $2.46 $(0.86) $0.82
Diluted net earnings per share:
Continuing operations $1.17 $2.36 $(1.00) $0.86
Discontinued operations (0.01) 0.09 0.14 (0.04)
Net earnings per share $1.16 $2.45 $(0.86) $0.82
Dividends paid per share $0.50 $0.40 $0.50 $0.40
Weighted average shares outstanding
(in thousands)
Basic 245,009 241,621 245,215 242,114
Diluted 246,190 242,649 246,198 243,472
CONSOLIDATED EARNINGS Year ended
(in millions) Dec. 25, Dec. 26,
2005 2004
Net sales and revenues:
Weyerhaeuser (1) $19,714 $19,436
Real Estate and Related Assets 2,915 2,495
Total net sales and revenues 22,629 21,931
Costs and expenses:
Weyerhaeuser:
Costs of products sold 15,460 14,615
Depreciation, depletion and
amortization 1,307 1,263
Selling expenses 461 481
General and administrative
expenses 899 942
Research and development
expenses 61 55
Taxes other than payroll and
income taxes 179 194
Charges for integration and
restructuring 21 39
Charges for closure of
facilities 693 17
Other operating costs, net (2) (3) (60) (233)
19,021 17,373
Real Estate and Related Assets:
Costs and operating expenses 1,945 1,763
Depreciation and amortization 16 14
Selling expenses 151 125
General and administrative
expenses 104 81
Taxes other than payroll and
income taxes 3 2
Other operating costs, net (3) (17)
Impairment of long-lived assets 33 --
2,249 1,968
Total costs and expenses 21,270 19,341
Operating income 1,359 2,590
Interest expense and other:
Weyerhaeuser:
Interest expense incurred (4) (739) (838)
Less interest capitalized 9 9
Interest income and other 214 24
Equity in income (loss) of
affiliates (5) (6) 14
Real Estate and Related Assets:
Interest expense incurred (55) (57)
Less interest capitalized 55 57
Interest income and other 12 31
Equity in income of unconsolidated
entities 57 52
Earnings before income taxes 906 1,882
Income taxes (6) (324) (627)
Earnings from continuing operations 582 1,255
Earnings from discontinued
operations, net of taxes (7) 151 28
Net earnings $733 $1,283
Basic net earnings per share:
Continuing operations $2.38 $5.33
Discontinued operations 0.62 0.12
Net earnings per share $3.00 $5.45
Diluted net earnings per share:
Continuing operations $2.36 $5.31
Discontinued operations 0.62 0.12
Net earnings per share $2.98 $5.43
Dividends paid per share $1.90 $1.60
Weighted average shares outstanding
(in thousands)
Basic 244,447 235,453
Diluted 245,559 236,546
(1) The first, second, third and fourth quarters of 2005 include charges
of $22 million, $27 million, $19 million and $16 million, respectively,
or $84 million year-to-date, for countervailing and anti-dumping duties
and related costs. The first, second, third and fourth quarters of 2004
include charges of $26 million, $34 million, $31 million and $27 million,
respectively, or $118 million year-to-date, for countervailing and anti-
dumping duties and related costs.
(2) The first, second, third and fourth quarters of 2005 include net
foreign exchange gains (losses) of $13 million, ($13) million, $37
million and ($21) million, respectively, for a year-to-date net gain of
$16 million. The first, second, third and fourth quarters of 2004 include
net foreign exchange gains (losses) of ($9) million, ($7) million, $16
million and $27 million, respectively, for a total year-to-date net gain
of $27 million. These gains and losses result primarily from
fluctuations in Canadian and New Zealand exchange rates.
(3) The first quarter of 2005 includes a $12 million charge for the
settlement of a linerboard antitrust lawsuit. The second quarter of 2005
includes an $18 million charge related to alder litigation and $57
million of income related to the recognition of a deferred gain from
previous timberlands sales. The third quarter of 2005 includes a $115
million gain on the sale of an investment in a joint venture. The fourth
quarter of 2005 includes a $38 million charge for the settlement of
linerboard antitrust litigation and $43 million of income for the
cumulative effect of a change to begin capitalizing Weyerhaeuser interest
to assets of Weyerhaeuser Real Estate Company.
The first quarter of 2004 includes a $49 million charge for the
settlement of lawsuits involving the market for Pacific Northwest alder
logs and a $33 million gain on the sale of an oriented strand board mill
in Slave Lake, Alberta. The second quarter of 2004 includes a $16 million
charge resulting from an adverse judgment in a lawsuit involving the
market for Pacific Northwest alder logs. The third quarter of 2004
includes a $271 million gain on the sale of timberlands in Georgia, and a
$20 million gain due to the reduction of the reserve for hardboard siding
claims. The fourth quarter of 2004 includes a net gain of $36 million on
the sale of facilities, and charges of $24 million recognized in
connection with a change in the method of estimating workers'
compensation liabilities and $23 million for the net book value of
technology donated to a university.
(4) The third and fourth quarters of 2005 include charges of $21 million
and $15 million, respectively, for the early extinguishment of debt. The
second and fourth quarters of 2004 include charges of $21 million and $52
million, respectively, for the early extinguishment of debt.
(5) The fourth quarter of 2005 includes a $15 million charge related to
the impairment of an investment in an equity affiliate.
(6) The second quarter of 2005 includes a charge of $44 million related
to the repatriation of $1.1 billion of eligible Canadian earnings under
the provisions of the American Jobs Creation Act of 2004. The third
quarter of 2005 includes a one-time tax benefit of $14 million related to
a change in the Ohio state income tax law.
(7) Includes the net operating results of the company's coastal British
Columbia and French composites operations. The second quarter of 2005
includes a gain of $110 million, including a tax benefit of $46 million,
related to the sale of the coastal British Columbia operations. The
third quarter of 2005 includes a $1 million charge related to the
termination of pension plans associated with these operations. The
fourth quarter of 2005 includes a pretax gain of $57 million and related
tax expense of $23 million associated with the sale of the French
composites operations. The third quarter of 2004 includes a $25 million
gain from a tenure reallocation agreement with the British Columbia
government. The fourth quarter of 2004 includes a $29 million charge for
the impairment of assets in the French composites operations.
WEYERHAEUSER COMPANY
STATISTICAL INFORMATION (unaudited)
Net sales and revenues (in millions): Q1 Q2
March 27, March 28, June 26, June 27,
2005 2004 2005 2004
Timberlands:
Logs $182 $193 $195 $211
Other products 82 58 63 66
264 251 258 277
Wood Products:
Softwood lumber 892 819 1,032 1,106
Plywood 183 221 196 263
Veneer 13 11 10 12
Composite panels 120 108 132 133
OSB 288 338 306 456
Hardwood lumber 94 90 102 100
Engineered I-Joists 160 134 213 178
Engineered Solid Section 190 148 241 194
Logs 27 23 24 38
Other products 272 255 339 312
2,239 2,147 2,595 2,792
Cellulose Fiber and White Papers:
Pulp 376 339 355 371
Paper 599 535 611 538
Coated groundwood 42 36 47 37
Liquid packaging board 47 49 52 53
Other products 14 10 12 13
1,078 969 1,077 1,012
Containerboard, Packaging and
Recycling:
Containerboard 117 81 101 80
Packaging 898 853 969 918
Recycling 92 80 92 91
Bags 22 19 21 18
Other products 34 33 40 34
1,163 1,066 1,223 1,141
Real Estate and Related Assets 655 469 648 524
Corporate and Other 149 135 151 147
Less sales of discontinued operations (177) (150) (144) (190)
$5,371 $4,887 $5,808 $5,703
Contribution (charge) to earnings: Q1 Q2
(in millions) March 27, March 28, June 26, June 27,
2005 2004 2005 2004
Timberlands (1)(2) $200 $159 $210 $201
Wood Products (3)(4)(5)(6) 131 173 204 448
Cellulose Fiber and White Papers (7) 19 (25) 16 14
Containerboard, Packaging and
Recycling (8)(9) 48 24 99 62
Real Estate and Related Assets (10) 183 120 156 118
Corporate and Other (11)(12)(13) (17) (76) 99 (67)
$564 $375 $784 $776
Net sales and revenues (in millions): Q3 Q4
Sept. 25, Sept. 26, Dec. 25, Dec. 26,
2005 2004 2005 2004
Timberlands:
Logs $188 $197 $196 $221
Other products 65 51 76 105
253 248 272 326
Wood Products:
Softwood lumber 889 1,089 811 901
Plywood 184 237 172 208
Veneer 9 11 12 10
Composite panels 122 138 123 122
OSB 267 341 303 255
Hardwood lumber 95 89 99 86
Engineered I-Joists 202 189 181 177
Engineered Solid Section 244 203 221 189
Logs 6 32 5 32
Other products 326 315 290 280
2,344 2,644 2,217 2,260
Cellulose Fiber and White Papers:
Pulp 381 381 370 380
Paper 604 583 603 570
Coated groundwood 45 39 46 44
Liquid packaging board 50 53 54 53
Other products 16 15 12 16
1,096 1,071 1,085 1,063
Containerboard, Packaging and
Recycling:
Containerboard 86 94 91 113
Packaging 929 916 914 897
Recycling 87 87 81 89
Bags 20 20 20 23
Other products 47 43 46 46
1,169 1,160 1,152 1,168
Real Estate and Related Assets 596 591 1,016 911
Corporate and Other 146 135 154 158
Less sales of discontinued operations (22) (193) (28) (201)
$5,582 $5,656 $5,868 $5,685
Contribution (charge) to earnings: Q3 Q4
(in millions) Sept. 25, Sept. 26, Dec. 25, Dec. 26,
2005 2004 2005 2004
Timberlands (1)(2) $191 $450 $183 $217
Wood Products (3)(4)(5)(6) 124 362 26 72
Cellulose Fiber and White Papers (7) (2) 80 (477) 35
Containerboard, Packaging and
Recycling (8)(9) 36 82 (188) 81
Real Estate and Related Assets (10) 145 155 250 217
Corporate and Other (11)(12)(13) 101 (45) 33 (83)
$595 $1,084 $(173) $539
Net sales and revenues (in millions): Year ended
Dec. 25, Dec. 26,
2005 2004
Timberlands:
Logs $761 $822
Other products 286 280
1,047 1,102
Wood Products:
Softwood lumber 3,624 3,915
Plywood 735 929
Veneer 44 44
Composite panels 497 501
OSB 1,164 1,390
Hardwood lumber 390 365
Engineered I-Joists 756 678
Engineered Solid Section 896 734
Logs 62 125
Other products 1,227 1,162
9,395 9,843
Cellulose Fiber and White Papers:
Pulp 1,482 1,471
Paper 2,417 2,226
Coated groundwood 180 156
Liquid packaging board 203 208
Other products 54 54
4,336 4,115
Containerboard, Packaging and
Recycling:
Containerboard 395 368
Packaging 3,710 3,584
Recycling 352 347
Bags 83 80
Other products 167 156
4,707 4,535
Real Estate and Related Assets 2,915 2,495
Corporate and Other 600 575
Less sales of discontinued operations (371) (734)
$22,629 $21,931
Contribution (charge) to earnings: Year ended
(in millions) Dec. 25, Dec. 26,
2005 2004
Timberlands (1)(2) $784 $1,027
Wood Products (3)(4)(5)(6) 485 1,055
Cellulose Fiber and White Papers (7) (444) 104
Containerboard, Packaging and
Recycling (8)(9) (5) 249
Real Estate and Related Assets (10) 734 610
Corporate and Other (11)(12)(13) 216 (271)
$1,770 $2,774
(1) The 2004 third quarter includes a $271 million gain on the sale of
timberlands in Georgia and a $5 million gain from a tenure reallocation
agreement with the British Columbia government.
(2) The first quarter of 2005 includes $3 million of charges related to
the closure of facilities. The third quarter of 2005 includes a $5
million loss related to hurricane damage. The fourth quarter of 2005
includes charges of $3 million related to the closure of facilities and
$6 million for losses associated with hurricane damage.
(3) The first, second, third and fourth quarters of 2005 include charges
of $22 million, $27 million, $19 million and $16 million, respectively,
or $84 million year-to-date, for countervailing and anti-dumping duties
and related costs. The first, second, third and fourth quarters of 2004
include charges of $26 million, $34 million, $31 million and $27 million,
respectively, or $118 million year-to-date, for countervailing and anti-
dumping duties and related costs.
(4) The second quarter of 2005 includes an $18 million charge related to
alder litigation. The third quarter of 2005 includes $9 million of
income related to the reduction of reserves for alder litigation and an
insurance settlement related to product liability claims. The first
quarter of 2004 includes a $49 million charge for the settlement of
lawsuits involving the market for Pacific Northwest alder logs. The
second quarter of 2004 includes a $16 million charge resulting from an
adverse judgment in a lawsuit involving the market for Pacific Northwest
alder logs. The third quarter of 2004 includes a $20 million gain due to
the reduction of the reserve for hardboard siding claims.
(5) The second quarter of 2005 includes a $6 million gain related to a
tenure reallocation agreement with the British Columbia government. The
third quarter of 2004 includes a $20 million gain from a tenure
reallocation agreement with the British Columbia government.
(6) The first, second, third and fourth quarters of 2005 include charges
of $1 million, $1 million, $6 million and $91 million, respectively,
associated with the closure of facilities. The first quarter of 2004
includes a credit of $2 million for the reversal of closure costs accrued
in prior years and a $33 million gain on the sale of an oriented strand
board mill in Slave Lake, Alberta. The second quarter of 2004 includes a
$5 million net loss on the sale of facilities. The third quarter of 2004
includes a $2 million net gain on the sale or closure of facilities. The
fourth quarter of 2004 includes charges of $3 million for the closure of
facilities and a gain of $36 million on the sale of facilities.
(7) The third and fourth quarters of 2005 include net charges of $22
million and $427 million, respectively, related to facility closures.
The second quarter of 2004 includes a $2 million asset impairment charge
related to assets held for sale.
(8) The first and fourth quarters of 2005 include charges of $12 million
and $38 million, respectively, associated with the settlement of
linerboard antitrust lawsuits. The third quarter of 2005 includes a $1
million loss related to hurricane damage.
(9) The first, second, third and fourth quarters of 2005 include charges
of $4 million, $2 million, $1 million and $130 million, respectively, for
the closure of facilities. The first quarter of 2004 includes closure
costs of $3 million. The second quarter of 2004 includes a net gain of
$1 million on the sales of a facility and a joint venture investment.
The third quarter of 2004 includes closure costs of $12 million,
including a pension termination charge of $9 million related to a closure
that occurred in a previous year. The fourth quarter of 2004 includes a
credit of $3 million for the reversal of closure costs accrued in prior
years.
(10) The first, second, third and fourth quarters of 2005 include net
gains (losses) on land and lot sales of $57 million, $21 million, ($1)
and $2 million, respectively. The fourth quarter of 2005 also includes a
$33 million charge for the impairment of unimproved land. The first
quarter of 2004 includes a $22 million gain on a land sale. The third
quarter of 2004 includes a gain of $18 million on the sale of a multi-
family site. The fourth quarter of 2004 includes a $24 million net gain
on land and lot sales.
(11) The second quarter of 2005 includes a $64 million pretax gain on the
sale of the company's operations in coastal British Columbia and $57
million of income related to the recognition of a deferred gain from
previous timberlands sales. The third quarter of 2005 includes a $115
million gain on the sale of an investment in a joint venture. The fourth
quarter of 2005 includes a $57 million gain on the sale of the company's
French composites operations and $43 million of income for the cumulative
effect of a change to begin capitalizing Weyerhaeuser interest to assets
of Weyerhaeuser Real Estate Company. The fourth quarter of 2004 includes
a $7 million gain for the settlement of an insurance claim relating to
the Cemwood litigation.
(12) The fourth quarter of 2005 includes charges of $15 million related
to the impairment of an investment in an equity affiliate and a $5
million charge related to the closure of facilities. The fourth quarter
of 2004 includes charges of $29 million for the impairment of assets in
the company's French composites operations, $24 million recognized in
connection with a change in the method of estimating workers'
compensation liabilities and $23 million for the net book value of
technology donated to a university.
(13) The first, second, third and fourth quarters of 2005 include net
foreign exchange gains (losses) of $13 million, ($12) million, $38
million and ($20) million, respectively, for a year-to-date net gain of
$19 million. The first, second, third and fourth quarters of 2004
include net foreign exchange gains (losses) of ($10) million, ($6)
million, $16 million and $26 million, respectivley, for a $26 million net
gain year-to-date. These gains and losses result primarily from
fluctuations in Canadian and New Zealand exchange rates.
WEYERHAEUSER COMPANY
STATISTICAL INFORMATION (unaudited)
Third party sales volumes: Q1 Q2
March 27, March 28, June 26, June 27,
2005 2004 2005 2004
Timberlands (thousands):
Logs - cunits 864 1,044 863 954
Wood Products (millions):
Softwood lumber - board feet 2,057 2,054 2,355 2,393
Plywood - square feet (3/8") 537 642 600 668
Veneer - square feet (3/8") 60 55 59 60
Composite panels - square feet
(3/4") 299 301 317 324
Oriented strand board - square
feet (3/8") 908 981 1,041 1,143
Hardwood lumber - board feet 102 103 114 117
Engineered I-Joists - LF 108 108 138 132
Engineered Solid Section - CF 9 8 10 10
Logs - cunits (in thousands) 187 170 177 279
Cellulose Fiber and White Papers
(thousands):
Pulp - air-dry metric tons 629 624 587 642
Paper - tons 736 741 742 718
Coated groundwood - tons 58 59 62 61
Liquid packaging board - tons 60 66 65 72
Paper converting - tons 475 467 494 459
Containerboard, Packaging and
Recycling (thousands):
Containerboard - tons 295 250 259 221
Packaging - MSF 17,354 18,146 18,600 18,917
Recycling - tons 692 678 695 701
Kraft bags and sacks - tons 23 24 22 23
Real Estate and Related Assets:
Single-family homes sold 1,378 1,506 1,525 1,564
Single-family homes closed 1,189 1,065 1,279 1,216
Single-family homes sold but not
closed at end of period 2,561 2,702 2,807 3,050
Third party sales volumes: Q3 Q4
Sept. 25, Sept. 26, Dec. 25, Dec. 26,
2005 2004 2005 2004
Timberlands (thousands):
Logs - cunits 886 904 939 1,018
Wood Products (millions):
Softwood lumber - board feet 2,179 2,299 2,059 2,144
Plywood - square feet (3/8") 558 672 485 647
Veneer - square feet (3/8") 51 55 61 55
Composite panels - square feet
(3/4") 308 315 305 294
Oriented strand board - square
feet (3/8") 1,008 1,078 991 1,011
Hardwood lumber - board feet 105 102 106 95
Engineered I-Joists - LF 125 133 113 123
Engineered Solid Section - CF 10 10 9 9
Logs - cunits (in thousands) 41 237 46 248
Cellulose Fiber and White Papers
(thousands):
Pulp - air-dry metric tons 653 633 633 659
Paper - tons 757 737 761 680
Coated groundwood - tons 56 60 56 63
Liquid packaging board - tons 64 69 69 69
Paper converting - tons 494 470 501 443
Containerboard, Packaging and
Recycling (thousands):
Containerboard - tons 238 245 254 285
Packaging - MSF 18,560 18,287 19,117 17,535
Recycling - tons 665 645 676 670
Kraft bags and sacks - tons 22 23 22 25
Real Estate and Related Assets:
Single-family homes sold 1,608 1,313 1,174 992
Single-family homes closed 1,257 1,345 1,922 1,638
Single-family homes sold but not
closed at end of period 3,158 3,018 2,410 2,372
Third party sales volumes: Year ended
Dec. 25, Dec. 26,
2005 2004
Timberlands (thousands):
Logs - cunits 3,552 3,920
Wood Products (millions):
Softwood lumber - board feet 8,650 8,890
Plywood - square feet (3/8") 2,180 2,629
Veneer - square feet (3/8") 231 225
Composite panels - square feet
(3/4") 1,229 1,234
Oriented strand board - square
feet (3/8") 3,948 4,213
Hardwood lumber - board feet 427 417
Engineered I-Joists - LF 484 496
Engineered Solid Section - CF 38 37
Logs - cunits (in thousands) 451 934
Cellulose Fiber and White Papers
(thousands):
Pulp - air-dry metric tons 2,502 2,558
Paper - tons 2,996 2,876
Coated groundwood - tons 232 243
Liquid packaging board - tons 258 276
Paper converting - tons 1,964 1,839
Containerboard, Packaging and
Recycling (thousands):
Containerboard - tons 1,046 1,001
Packaging - MSF 73,631 72,885
Recycling - tons 2,728 2,694
Kraft bags and sacks - tons 89 95
Real Estate and Related Assets:
Single-family homes sold 5,685 5,375
Single-family homes closed 5,647 5,264
Single-family homes sold but not
closed at end of period 2,410 2,372
Total production volumes: Q1 Q2
March 27, March 28, June 26, June 27,
2005 2004 2005 2004
Timberlands (thousands):
Fee Depletion - cunits 2,248 2,265 2,231 2,404
Wood Products (millions):
Softwood lumber - board feet 1,821 1,760 1,869 1,881
Plywood - square feet (3/8") 303 422 302 405
Veneer - square feet (3/8") (1) 517 585 529 609
Composite panels - square feet
(3/4") 267 268 282 281
Oriented strand board - square
feet (3/8") 1,007 1,031 1,019 1,056
Hardwood lumber - board feet 92 89 96 96
Engineered I-Joists - LF 133 110 132 124
Engineered Solid Section - CF 11 9 10 11
Cellulose Fiber and White Papers
(thousands):
Pulp - air-dry metric tons 621 619 614 636
Paper - tons (2) 763 743 752 736
Coated groundwood - tons 55 55 59 61
Liquid packaging board - tons 60 61 64 67
Paper converting - tons 475 460 487 442
Containerboard, Packaging and
Recycling (thousands):
Containerboard - tons (3) 1,503 1,503 1,581 1,598
Packaging - MSF 18,628 19,493 19,915 20,208
Recycling - tons (4) 1,624 1,607 1,673 1,707
Kraft bags and sacks - tons 23 24 22 23
Total production volumes: Q3 Q4
Sept. 25, Sept. 26, Dec. 25, Dec. 26,
2005 2004 2005 2004
Timberlands (thousands):
Fee Depletion - cunits 2,098 2,189 2,153 2,155
Wood Products (millions):
Softwood lumber - board feet 1,651 1,819 1,645 1,727
Plywood - square feet (3/8") 296 405 254 396
Veneer - square feet (3/8") (1) 486 592 447 600
Composite panels - square feet
(3/4") 268 272 263 245
Oriented strand board - square
feet (3/8") 1,017 1,022 1,035 972
Hardwood lumber - board feet 91 84 85 80
Engineered I-Joists - LF 108 136 110 134
Engineered Solid Section - CF 10 11 10 10
Cellulose Fiber and White Papers
(thousands):
Pulp - air-dry metric tons 663 652 604 639
Paper - tons (2) 765 766 780 761
Coated groundwood - tons 60 62 60 62
Liquid packaging board - tons 69 71 71 67
Paper converting - tons 483 471 505 465
Containerboard, Packaging and
Recycling (thousands):
Containerboard - tons (3) 1,597 1,604 1,587 1,586
Packaging - MSF 19,416 19,473 20,130 18,648
Recycling - tons (4) 1,716 1,703 1,730 1,701
Kraft bags and sacks - tons 21 23 22 24
Total production volumes: Year ended
Dec. 25, Dec. 26,
2005 2004
Timberlands (thousands):
Fee Depletion - cunits 8,730 9,013
Wood Products (millions):
Softwood lumber - board feet 6,986 7,187
Plywood - square feet (3/8") 1,155 1,628
Veneer - square feet (3/8") (1) 1,979 2,386
Composite panels - square feet
(3/4") 1,080 1,066
Oriented strand board - square
feet (3/8") 4,078 4,081
Hardwood lumber - board feet 364 349
Engineered I-Joists - LF 483 504
Engineered Solid Section - CF 41 42
Cellulose Fiber and White Papers
(thousands):
Pulp - air-dry metric tons 2,502 2,546
Paper - tons (2) 3,060 3,006
Coated groundwood - tons 234 240
Liquid packaging board - tons 264 266
Paper converting - tons 1,950 1,838
Containerboard, Packaging and
Recycling (thousands):
Containerboard - tons (3) 6,268 6,291
Packaging - MSF 78,089 77,822
Recycling - tons (4) 6,743 6,718
Kraft bags and sacks - tons 88 94
(1) Veneer production represents lathe production and includes volumes
that are further processed into plywood and engineered lumber products by
company mills.
(2) Paper production includes unprocessed rolls and converted paper
volumes.
(3) Containerboard production represents machine production and includes
volumes that are further processed into packaging and kraft bags and
sacks by company facilities.
(4) Recycling production includes volumes processed in Weyerhaeuser
recycling facilities that are consumed by company facilities and brokered
volumes.
WEYERHAEUSER COMPANY
STATISTICAL INFORMATION
CONDENSED CONSOLIDATED BALANCE SHEET (unaudited)
(in millions)
March 27, June 26, Sept. 25, Dec. 25, Dec. 26,
Assets 2005 2005 2005 2005 2004
Weyerhaeuser
Current assets:
Cash and short-term
investments $402 $1,704 $885 $818 $1,044
Receivables, less
allowances 1,816 1,987 1,948 1,727 1,534
Inventories 2,109 2,004 1,977 1,917 1,876
Prepaid expenses 633 611 580 414 588
Assets of discontinued
operations 1,166 41 38 -- 1,183
Total current
assets 6,126 6,347 5,428 4,876 6,225
Property and equipment 11,439 11,170 11,089 10,510 11,661
Construction in progress 323 451 544 533 268
Timber and timberlands at
cost, less depletion
charged to disposals 3,712 3,709 3,691 3,705 3,733
Investments in and
advances to equity
affiliates 491 495 496 486 489
Goodwill 2,997 2,977 2,988 2,982 2,996
Deferred pension and other
assets 1,197 1,249 1,309 1,314 1,201
Restricted assets held by
special purpose entitites 914 916 914 916 909
27,199 27,314 26,459 25,322 27,482
Real Estate and Related
Assets
Cash and short-term
investments 5 11 4 286 153
Receivables, less
allowances 60 57 49 42 43
Real estate and land for
sale and development 2,083 2,333 2,288 2,222 1,947
Other assets 323 278 357 357 329
2,471 2,679 2,698 2,907 2,472
Total assets $29,670 $29,993 $29,157 $28,229 $29,954
Liabilities and Shareholders'
Interest
Weyerhaeuser
Current liabilities:
Notes payable and
commercial paper $2 $2 $3 $3 $3
Current maturities of
long-term debt 95 225 182 189 488
Accounts payable 1,122 1,198 1,144 1,241 1,130
Accrued liabilities 1,311 1,654 1,560 1,622 1,431
Liabilities of
discontinued operations 301 30 27 -- 292
Total current
liabilities 2,831 3,109 2,916 3,055 3,344
Long-term debt 9,263 8,926 8,010 7,604 9,277
Deferred income taxes 4,355 4,320 4,396 4,035 4,351
Deferred pension, other
postretirement benefits
and other liabilities 1,492 1,558 1,583 1,591 1,497
Liabilities (nonrecourse
to Weyerhaeuser) held by
special purpose entities 820 784 783 764 815
18,761 18,697 17,688 17,049 19,284
Real Estate and Related
Assets
Notes payable and
commercial paper 2 5 3 7 2
Long-term debt 869 854 852 851 867
Other liabilities 533 588 488 522 546
1,404 1,447 1,343 1,380 1,415
Total liabilities 20,165 20,144 19,031 18,429 20,699
Shareholders' interest 9,505 9,849 10,126 9,800 9,255
Total liabilities and
shareholders' interest $29,670 $29,993 $29,157 $28,229 $29,954
STATEMENT OF CASH FLOWS Q1 Q2
SELECTED INFORMATION (unaudited) March 27, March 28, June 26, June 27,
(in millions) 2005 2004 2005 2004
(Weyerhaeuser only, excludes Real
Estate & Related Assets)
Net cash from operations $(203) $(89) $713 $787
Cash paid for property and
equipment (117) (79) (196) (80)
Cash paid for timberlands
reforestation (12) (12) (6) (6)
Cash received from issuances of
debt -- -- 1 --
Revolving credit facilities,
notes and commercial paper
borrowings, net 19 67 23 (80)
Payments on debt (404) (60) (206) (813)
Proceeds from equity offering -- -- -- 954
Proceeds from the sale of
operations -- -- 1,107 --
STATEMENT OF CASH FLOWS Q3 Q4
SELECTED INFORMATION (unaudited) Sept. 25, Sept. 26, Dec. 25, Dec. 26,
(in millions) 2005 2004 2005 2004
(Weyerhaeuser only, excludes Real
Estate & Related Assets)
Net cash from operations $441 $592 $669 $745
Cash paid for property and
equipment (220) (93) (310) (222)
Cash paid for timberlands
reforestation (6) (5) (8) (7)
Cash received from issuances of
debt -- -- -- 1
Revolving credit facilities,
notes and commercial paper
borrowings, net (40) (6) 170 35
Payments on debt (965) (253) (603) (742)
Proceeds from equity offering -- -- -- --
Proceeds from the sale of
operations -- -- 102 --
STATEMENT OF CASH FLOWS Year ended
SELECTED INFORMATION (unaudited) Dec. 25, Dec. 26,
(in millions) 2005 2004
(Weyerhaeuser only, excludes Real
Estate & Related Assets)
Net cash from operations $1,620 $2,035
Cash paid for property and
equipment (843) (474)
Cash paid for timberlands
reforestation (32) (30)
Cash received from issuances of
debt 1 1
Revolving credit facilities,
notes and commercial paper
borrowings, net 172 16
Payments on debt (2,178) (1,868)
Proceeds from equity offering -- 954
Proceeds from the sale of
operations 1,209 --
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SOURCE: Weyerhaeuser Company
CONTACT: media, Bruce Amundson, +1-253-924-3047, or analysts,
Kathryn McAuley, +1-253-924-2058, both of Weyerhaeuser Company
Web site: http://www.weyerhaeuser.com/