- Net income attributable to Rayonier of
$39.4 million or $0.32 per share, on revenues of $171.4
million
- Pro forma net income of $40.6 million
or $0.33 per share
- Operating income of $49.7 million, pro
forma operating income of $50.9 million and Adjusted EBITDA of
$87.2 million
- Year-to-date cash provided by
operations of $163.9 million and cash available for distribution
(CAD) of $123.5 million
Rayonier Inc. (NYSE:RYN) today reported third quarter net income
attributable to Rayonier of $39.4 million, or $0.32 per share, on
revenues of $171.4 million. This compares to net income
attributable to Rayonier of $19.7 million, or $0.16 per share, on
revenues of $151.7 million in the prior year quarter. The third
quarter results include $1.2 million of costs related to
shareholder litigation.1 The prior year third quarter results
included $1.5 million of costs related to shareholder litigation1
and $0.4 million of expense related to the write-off of capitalized
financing costs in connection with new credit facilities. Excluding
these items, pro forma net income2 was $40.6 million, or $0.33 per
share, versus $21.6 million, or $0.17 per share, in the prior year
period.
The following table summarizes the current quarter and
comparable prior year period results on an actual and pro forma
basis:
Three Months Ended
September 30, September 30, (millions of dollars,
except earnings per share (EPS))
2016 2015 $
EPS $ EPS Revenues $171.4 $151.7
Net income attributable to Rayonier $39.4 $0.32 $19.7
$0.16 Costs related to shareholder litigation1 1.2 0.01 1.5 0.01
Expense related to the write-off of
capitalized financing costs
— — 0.4 — Pro forma net income2 $40.6
$0.33 $21.6 $0.17
Third quarter operating income was $49.7 million versus $27.8
million in the prior year period. The third quarter operating
income includes $1.2 million of costs related to shareholder
litigation.1 The prior year third quarter operating income included
$1.5 million of costs related to shareholder litigation.1 Excluding
this item, pro forma operating income2 was $50.9 million versus
$29.3 million in the prior year period. Third quarter Adjusted
EBITDA2 was $87.2 million versus $65.8 million in the prior year
period.
The following table summarizes operating income (loss), pro
forma operating income (loss)2 and Adjusted EBITDA2 for the current
quarter and comparable prior year period:
Three Months
Ended September 30, Pro forma Operating Income
Operating Income (Loss)
(Loss)(2)
Adjusted EBITDA(2)
(millions of dollars)
2016 2015 2016
2015 2016 2015 Southern Timber $8.2 $10.5 $8.2
$10.5 $18.2 $24.9 Pacific Northwest Timber (3.3 ) 3.1 (3.3 ) 3.1
3.4 7.3 New Zealand Timber 6.6 (0.9 ) 6.6 (0.9 ) 12.6 6.1 Real
Estate 43.1 20.0 43.1 20.0 56.6 30.9 Trading 0.5 0.4 0.5 0.4 0.5
0.4 Corporate and other (5.4 ) (5.3 ) (4.2 ) (3.8 ) (4.1 ) (3.8 )
Total $49.7 $27.8 $50.9 $29.3 $87.2
$65.8
Year-to-date cash provided by operating activities was $163.9
million versus $143.4 million in the prior year period.
Year-to-date cash available for distribution (CAD)2 of $123.5
million increased $22.6 million versus the prior year period
primarily due to higher Adjusted EBITDA2 ($27.4 million), partially
offset by higher cash interest paid ($1.7 million), higher cash
taxes paid ($0.1 million) and higher capital expenditures ($3.0
million).
“Our strong overall results this quarter reflect the balance and
diversity of our portfolio, as favorable Real Estate and New
Zealand Timber results more than offset the impact of lower harvest
volumes across all our regions,” said David Nunes, President and
CEO. “Southern Timber volumes decreased 23% relative to the prior
year quarter as our ability to harvest in Texas and Louisiana
continued to be hampered by wet ground conditions from heavy
rainfall, and as we reduced volumes in certain eastern markets
following unseasonably dry weather, which led to higher mill
inventories and softer market conditions. Average stumpage prices
in Southern Timber increased by 1%, primarily due to geographic
mix. In the Pacific Northwest, harvest volumes decreased 32%
relative to the prior year quarter, partially offset by a 3%
increase in average domestic and export sawtimber prices. New
Zealand Timber results were well above the prior year quarter even
though harvest volumes were 23% lower. This performance improvement
was driven by an 18% increase in export prices, reflecting strong
demand from China for Radiata pine logs, as well as a 25% increase
in domestic sawtimber prices as a result of solid domestic demand
and a strengthening of the New Zealand dollar. Real Estate results
were significantly above the prior year quarter due to a large
Non-Strategic / Timberland sale in Georgia and continued strong
demand for Rural HBU properties.”
Southern Timber
Third quarter sales of $27.8 million decreased $7.0 million, or
20%, versus the prior year period. Harvest volumes decreased 23% to
1.09 million tons versus 1.42 million tons in the prior year
period. This decrease in harvest volumes was driven by wet weather
in the Gulf states, which restricted our ability to harvest in that
region, and curtailed harvest activity in certain eastern markets
in response to softer market conditions resulting from dry weather
and higher mill inventories. Average sawtimber stumpage prices
decreased 4% to $26.17 per ton versus $27.27 per ton in the prior
year period, while average pulpwood stumpage prices increased 6% to
$17.36 per ton versus $16.39 per ton in the prior year period. The
decrease in average sawtimber prices was driven by mix,
specifically heavy rainfall resulting in decreased volume in one of
the Company’s higher-priced sawtimber regions. The increase in
average pulpwood prices was also driven by mix, as an increased
proportion of volume came from higher-priced regions. Overall,
weighted-average stumpage prices (including hardwood) increased 1%
to $19.76 per ton versus $19.63 per ton in the prior year period.
Operating income of $8.2 million decreased $2.3 million versus the
prior year period due to lower volumes ($3.0 million), higher
overhead and road maintenance costs ($0.3 million) and lower
non-timber income ($0.2 million), which were partially offset by
lower depletion rates ($1.0 million) and higher weighted-average
stumpage prices ($0.2 million).
Third quarter Adjusted EBITDA2 of $18.2 million was $6.7 million
below the prior year period.
Pacific Northwest Timber
Third quarter sales of $16.1 million decreased $5.5 million, or
25%, versus the prior year period. Harvest volumes decreased 32% to
241,000 tons versus 353,000 tons in the prior year period, as
additional volume from our Oregon acquisition was more than offset
by harvest curtailments in Washington in response to weaker than
expected export market conditions in the beginning of the quarter.
Average delivered sawtimber prices increased 3% to $76.69 per ton
versus $74.33 per ton in the prior year period, while average
delivered pulpwood prices decreased 13% to $40.07 per ton versus
$45.88 per ton in the prior year period. The increase in average
sawtimber prices was due to an overall strengthening of export and
domestic sawtimber markets, combined with additional volume from
Oregon, which generally commands a higher sawtimber price than
Washington. The decrease in pulpwood prices was due to the
increased availability of wood chips in certain market areas.
Operating loss of $3.3 million versus operating income of $3.1
million in the prior year period was primarily due to higher
depletion rates resulting from our Oregon acquisition ($3.8
million), lower volumes ($2.6 million), higher overhead and
severance taxes ($0.5 million) and lower non-timber income ($0.1
million), which were partially offset by higher prices ($0.6
million).
Third quarter Adjusted EBITDA2 of $3.4 million was $3.9 million
below the prior year period.
New Zealand Timber
Third quarter sales of $42.2 million increased $1.1 million, or
3%, versus the prior year period. Harvest volumes decreased 23% to
552,000 tons versus 721,000 tons in the prior year period. Average
delivered prices for export sawtimber increased 18% to $97.44 per
ton versus $82.42 per ton in the prior year period, while average
delivered prices for domestic sawtimber increased 25% to $75.06 per
ton versus $60.12 per ton in the prior year period. The increase in
export sawtimber prices was primarily due to stronger demand from
China. The increase in domestic sawtimber prices (in U.S. dollar
terms) was driven primarily by strong demand for construction
materials and the rise in the NZ$/US$ exchange rate (US$0.72 per
NZ$1.00 versus US$0.66 per NZ$1.00). Excluding the impact of
foreign exchange rates, domestic sawtimber prices increased 15%
from the prior year period. Operating income of $6.6 million
increased $7.5 million versus the prior year period due to higher
prices ($6.6 million), changes in volume/mix ($0.3 million), lower
depletion rates ($0.1 million), favorable changes in foreign
exchange impacts ($1.2 million) and higher carbon credit sales
($0.3 million), which were partially offset by higher forest
management and overhead costs ($1.0 million).
Third quarter Adjusted EBITDA2 of $12.6 million was $6.5 million
above the prior year period.
Real Estate
Third quarter sales of $60.6 million increased $25.4 million
versus the prior year period, while operating income of $43.1
million increased $23.1 million versus the prior year period. Sales
and operating income increased in the third quarter due to higher
volumes (23,601 acres sold versus 14,204 acres sold in the prior
year period), and a 4% increase in weighted-average prices ($2,569
per acre versus $2,480 per acre in the prior year period).
Unimproved Development sales of $1.4 million were comprised of a
73-acre tract in St. John’s County, Florida for approximately
$18,500 per acre.
Rural sales of $6.4 million were comprised of 2,069 acres at an
average price of $3,082 per acre.
Non-strategic / Timberland sales of $52.8 million were comprised
of 21,459 acres at an average price of $2,465 per acre, including
17,772 acres in Georgia for $2,720 per acre.
Third quarter Adjusted EBITDA2 of $56.6 million was $25.7
million above the prior year period.
Trading
Third quarter sales of $24.7 million increased $5.7 million
versus the prior year period due to higher volumes and prices.
Sales volumes increased 16% to 269,000 tons versus 231,000 tons in
the prior year period. Average prices increased 11% to $91.80 per
ton versus $82.45 per ton in the prior year period. The increases
in both volumes and prices were primarily due to stronger demand
from China. Operating income of $0.5 million increased $0.1 million
versus the prior year period.
Other Items
Third quarter corporate and other operating expenses of $5.4
million increased $0.1 million versus the prior year period due to
increased selling, general and administrative expenses ($0.2
million) and timberland transaction costs ($0.2 million), which
were partially offset by lower costs related to shareholder
litigation1 ($0.3 million).
Third quarter interest expense of $8.5 million increased $0.9
million versus the prior year period due to higher outstanding
debt, partially offset by lower average rates and $0.4
million of expense related to the write-off of capitalized
financing costs in the prior year period.
Third quarter income tax expense of $0.8 million was principally
related to the New Zealand JV.
Outlook
“Based on our strong results for the first nine months and
expectations for the balance of the year, we now anticipate
full-year Adjusted EBITDA of $228 to $235 million, well above our
prior guidance of $195 to $215 million,” added Nunes. “We continue
to expect relatively flat prices in our Southern Timber and Pacific
Northwest Timber segments for the remainder of the year, and we
will continue to adjust harvest levels as appropriate to maximize
the long-term value of our assets. In our New Zealand Timber
segment, we expect continued strong performance driven by solid
demand in both domestic and export markets. In our Real Estate
segment, following an extraordinarily strong third quarter, we
expect relatively light closings in the fourth quarter. We continue
to be encouraged by interest in our Wildlight development project
north of Jacksonville, Florida.”
Portfolio Management Update
“In addition to delivering strong operational performance
year-to-date, we have continued to focus on upgrading our
timberland assets through active portfolio management. To this end,
we have recently entered into several acquisition and disposition
transactions,” said Nunes.
Dispositions: We recently agreed to sell 62,100 acres of
relatively young (average age 11 years) timberland in Alabama and
Mississippi for $120 million in three separate transactions. Two of
these transactions totaling $78 million closed in October, and the
remaining $42 million transaction is scheduled to close in January
of next year. Consistent with our disclosure practices, these Large
Dispositions will be excluded from our Adjusted EBITDA.
Acquisitions: In the third quarter, we acquired 37,500 acres of
high-quality timberland in Texas for $77 million in three separate
transactions. Relative to our recent dispositions, these new
properties have an older average age of 15 years and higher
inventory stocking levels.
“Together with the Pacific Northwest portfolio realignment that
we announced in the second quarter, we are excited about the
overall upgrade to our timberland portfolio that these transactions
represent. We will continue to identify and act on opportunities to
enhance long-term shareholder value through active portfolio
management and nimble capital allocation,” concluded Nunes.
Conference Call
A conference call and live webcast will be held on Thursday,
November 3, 2016 at 10:00 AM EDT to discuss these results.
Access to the live webcast will be available at
www.rayonier.com. A replay of the webcast will be archived on the
Company’s website and available shortly after the call.
Investors may listen to the conference call by dialing
800-369-1184 (domestic) or 415-228-3898 (international), passcode:
Rayonier. A replay of the conference call will be available one
hour following the call until Thursday, November 10, 2016 by
dialing 866-443-1213 (domestic) or 203-369-1091 (international),
passcode: 11032016.
Complimentary copies of Rayonier press releases and other
financial documents are also available by calling
1-800-RYN-7611.
1“Costs related to shareholder litigation” include expenses
incurred as a result of the securities litigation, the shareholder
derivative demands and the Securities and Exchange Commission
investigation. See Note 10—Contingencies of Item 8 — Financial
Statements and Supplementary Data in the Company’s most recent
Annual Report on Form 10-K.
2Pro forma net income, Pro forma revenues (sales), Pro forma
operating income, Adjusted EBITDA and CAD are non-GAAP measures
defined and reconciled to GAAP in the attached exhibits.
About Rayonier
Rayonier is a leading timberland real estate investment trust
with assets located in some of the most productive softwood timber
growing regions in the United States and New Zealand. As of
September 30, 2016, Rayonier owned, leased or managed
approximately 2.7 million acres of timberlands located in the U.S.
South (1.9 million acres), U.S. Pacific Northwest (379,000 acres)
and New Zealand (436,000 acres). More information is available at
www.rayonier.com.
___________________________________________________________________________
Forward-Looking Statements - Certain statements in this
presentation regarding anticipated financial outcomes including
Rayonier’s earnings guidance, if any, business and market
conditions, outlook, expected dividend rate, Rayonier’s business
strategies, including expected harvest schedules, timberland
acquisitions, sales of non-strategic timberlands, the anticipated
benefits of Rayonier’s business strategies, and other similar
statements relating to Rayonier’s future events, developments or
financial or operational performance or results, are
“forward-looking statements” made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
and other federal securities laws. These forward-looking statements
are identified by the use of words such as “may,” “will,” “should,”
“expect,” “estimate,” “believe,” “intend,” “project,” ‘anticipate”
and other similar language. However, the absence of these or
similar words or expressions does not mean that a statement is not
forward-looking. While management believes that these
forward-looking statements are reasonable when made,
forward-looking statements are not guarantees of future performance
or events and undue reliance should not be placed on these
statements.
The following important factors, among others, could cause
actual results or events to differ materially from those expressed
in forward-looking statements that may have been made in this
document: the cyclical and competitive nature of the industries in
which we operate; fluctuations in demand for, or supply of, our
forest products and real estate offerings; entry of new competitors
into our markets; changes in global economic conditions and world
events; fluctuations in demand for our products in Asia, and
especially China; various lawsuits relating to matters arising out
of our previously announced internal review and restatement of our
consolidated financial statements; the uncertainties of potential
impacts of climate-related initiatives; the cost and availability
of third party logging and trucking services; the geographic
concentration of a significant portion of our timberland; our
ability to identify, finance and complete timberland acquisitions;
changes in environmental laws and regulations regarding timber
harvesting, delineation of wetlands, and endangered species, that
may restrict or adversely impact our ability to conduct our
business, or increase the cost of doing so; adverse weather
conditions, natural disasters and other catastrophic events such as
hurricanes, wind storms and wildfires, which can adversely affect
our timberlands and the production, distribution and availability
of our products; interest rate and currency movements; our capacity
to incur additional debt; changes in tariffs, taxes or treaties
relating to the import and export of our products or those of our
competitors; changes in key management and personnel; our ability
to meet all necessary legal requirements to continue to qualify as
a real estate investment trust (“REIT”) and changes in tax laws
that could adversely affect beneficial tax treatment; the cyclical
nature of the real estate business generally; a delayed or weak
recovery in the housing market; the lengthy, uncertain and costly
process associated with the ownership, entitlement and development
of real estate, especially in Florida, which also may be affected
by changes in law, policy and political factors beyond our control;
unexpected delays in the entry into or closing of real estate
transactions; changes in environmental laws and regulations that
may restrict or adversely impact our ability to sell or develop
properties; the timing of construction and availability of public
infrastructure; and the availability of financing for real estate
development and mortgage loans.
For additional factors that could impact future results, please
see Item 1A - Risk Factors in the Company’s most recent Annual
Report on Form 10-K and similar discussion included in other
reports that we subsequently file with the Securities and Exchange
Commission (the "SEC”). Forward-looking statements are only as of
the date they are made, and the Company undertakes no duty to
update its forward-looking statements except as required by law.
You are advised, however, to review any further disclosures we make
on related subjects in our subsequent reports filed with the
SEC.
Non-GAAP Financial Measures - To supplement Rayonier’s
financial statements presented in accordance with generally
accepted accounting principles in the United States (“GAAP”),
Rayonier uses certain non-GAAP measures, including “cash available
for distribution,” “pro forma sales,” “pro forma operating income,”
“pro forma net income,” and “Adjusted EBITDA,” which are defined
and further explained in this communication. Reconciliation of such
measures to the nearest GAAP measures can also be found in this
communication. Rayonier’s definitions of these non-GAAP measures
may differ from similarly titled measures used by others. These
non-GAAP measures should be considered supplemental to, and not a
substitute for, financial information prepared in accordance with
GAAP.
RAYONIER INC. AND SUBSIDIARIES CONDENSED STATEMENTS OF
CONSOLIDATED INCOME September 30, 2016 (unaudited)
(millions of dollars, except per share information)
Three Months Ended Nine Months Ended September 30,
June 30, September 30, September 30, September 30,
2016 2016 2015 2016 2015
SALES $171.4 $261.6
$151.7 $567.8 $407.8 Costs and Expenses Cost of sales
116.6 138.2 116.0 362.8 327.0 Selling and general expenses 10.6
11.3 10.7 31.6 34.3 Other operating income, net (5.5 ) (9.5 ) (2.8
) (20.9) (15.5 )
OPERATING INCOME 49.7 121.6 27.8 194.3 62.0
Interest expense (8.5 ) (8.0 ) (7.6 ) (23.6) (24.6 ) Interest
income and miscellaneous income (expense), net 0.2 0.3
(1.6 ) (1.2) (4.2 )
INCOME BEFORE INCOME TAXES 41.4
113.9 18.6 169.5 33.2 Income tax (expense) benefit (0.8 ) (2.3 )
0.6 (2.2) 1.3
NET INCOME 40.6 111.6 19.2 167.3
34.5 Less: Net income (loss) attributable to noncontrolling
interest 1.2 1.8 (0.5 ) 3.7 (1.4 )
NET INCOME
ATTRIBUTABLE TO RAYONIER INC. $39.4 $109.8 $19.7
$163.6 $35.9
EARNINGS PER COMMON SHARE Basic
earnings per share attributable to Rayonier Inc. $0.32 $0.90 $0.16
$1.34 $0.28 Diluted earnings per share attributable to Rayonier
Inc. $0.32 $0.89 $0.16 $1.33 $0.28 Pro forma net income (a)
$0.33 $0.07 $0.17 $0.52 $0.31
Weighted Average Common Shares used for determining
Basic EPS 122,597,927 122,567,853 125,143,706
122,574,094 126,125,802 Diluted EPS 122,882,633
122,820,914 125,305,972 122,782,900
126,770,703 (a) Pro forma net income per share is a
non-GAAP measure. See Schedule F for definition and a
reconciliation to the nearest GAAP measure.
A
RAYONIER INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED
BALANCE SHEETS September 30, 2016 (unaudited)
(millions of dollars) September 30, December
31, 2016 2015
Assets Cash and cash equivalents $110.0 $51.8
Assets held for sale 47.4 — Other current assets 56.7 53.9 Timber
and timberlands, net of depletion and amortization 2,325.5 2,066.8
Higher and better use timberlands and real estate development
investments 70.3 65.4 Property, plant and equipment 20.0 15.8 Less
- accumulated depreciation (8.9 ) (9.1 ) Net property, plant and
equipment 11.1 6.7 Other assets 50.4 71.3 $2,671.4
$2,315.9
Liabilities and Shareholders’ Equity
Current maturities of long-term debt $31.8 — Other current
liabilities 68.4 $59.5 Long-term debt 1,033.3 830.6 Other
non-current liabilities 89.3 64.1 Total Rayonier Inc. shareholders’
equity 1,361.2 1,288.1 Noncontrolling interest 87.4 73.6
Total shareholders’ equity 1,448.6 1,361.7
$2,671.4 $2,315.9
B
RAYONIER INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF SHAREHOLDERS’ EQUITY September 30, 2016
(unaudited) (millions of dollars, except share
information)
Common Shares
Accumulated
Other
Non-
Retained
Comprehensive
controlling
Shareholders’
Shares
Amount
Earnings
Income/(Loss)
Interest
Equity
Balance, December 31, 2014 126,773,097 $702.6 $790.7 ($4.8 )
$86.7 $1,575.2 Net income (loss) — — 46.2 — (2.3 ) 43.9 Dividends
($1.00 per share) — — (124.9 ) — — (124.9 ) Issuance of shares
under incentive stock
Plans
205,219 2.1 — — — 2.1 Stock-based compensation — 4.5 — — — 4.5
Repurchase of common shares made under repurchase program
(4,202,697 ) — (100.0 ) — — (100.0 ) Other (a) (5,402 ) (0.4 ) 0.8
(28.7 ) (10.8 ) (39.1 )
Balance, December 31, 2015
122,770,217 $708.8 $612.8 ($33.5 ) $73.6 $1,361.7 Net income — —
163.6 — 3.7 167.3 Dividends ($0.75 per share) — — (92.1 ) — — (92.1
) Issuance of shares under incentive stock
Plans
149,666 0.9 — — — 0.9 Stock-based compensation — 3.9 — — — 3.9
Repurchase of common shares made under repurchase program (35,200 )
— (0.7 ) — — (0.7 ) Other (a) (8,648 ) (5.6 ) — 3.1
10.1 7.6
Balance, September 30, 2016
122,876,035 $708.0 $683.6 ($30.4 ) $87.4
$1,448.6
(a)
Primarily includes shares purchased from employees in
non-open market transactions to pay withholding taxes associated
with the vesting of restricted stock, actuarial changes and
amortization of pension and postretirement plan liabilities,
foreign currency translation adjustments, and mark-to-market
adjustments of qualifying cash flow hedges. The nine months ended
September 30, 2016 also include changes as a result of the
recapitalization of the New Zealand JV.
C
RAYONIER INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS September 30, 2016 (unaudited)
(millions of dollars) Nine Months Ended
September 30, 2016 2015
Cash provided by operating
activities: Net income $167.3 $34.5 Depreciation, depletion and
amortization 83.7 85.8 Non-cash cost of land and improved
development 10.1 9.5 Gain on sale of large disposition of
timberlands (101.3 ) — Other items to reconcile net income to cash
provided by operating activities 9.9 4.1 Changes in working capital
and other assets and liabilities (5.8 ) 9.5 163.9
143.4
Cash used for investing activities: Capital
expenditures (40.2 ) (37.2 ) Real estate development investments
(4.8 ) (2.0 ) Purchase of timberlands (353.8 ) (88.5 ) Assets
purchased in business acquisition (1.1 ) — Net proceeds from large
disposition of timberlands 127.0 — Change in restricted cash 22.4
(17.8 ) Other (3.6 ) 2.6 (254.1 ) (142.9 )
Cash provided
by (used for) financing activities: Net increase in debt 239.6
78.2 Dividends paid (92.1 ) (94.3 ) Proceeds from the issuance of
common shares 0.9 1.3 Repurchase of common shares made under
repurchase program (0.7 ) (73.6 ) Debt issuance costs (0.8 ) (1.7 )
Other (0.1 ) — 146.8 (90.1 )
Effect of exchange
rate changes on cash 1.6 (6.2 )
Cash and cash
equivalents: Change in cash and cash equivalents 58.2 (95.8 )
Balance, beginning of year 51.8 161.6 Balance, end of
period $110.0 $65.8
D
RAYONIER INC. AND SUBSIDIARIES BUSINESS SEGMENT SALES,
PRO FORMA SALES, OPERATING INCOME, PRO FORMA OPERATING
INCOME AND ADJUSTED EBITDA September 30, 2016
(unaudited) (millions of dollars) Three
Months Ended Nine Months Ended September 30, June 30,
September 30, September 30, September 30, 2016 2016 2015
2016 2015
Sales Southern Timber $27.8 $29.6 $34.8 $102.2
$103.0 Pacific Northwest Timber 16.1 16.9 21.6 52.3 57.8 New
Zealand Timber 42.2 47.7 41.1 126.0 121.5 Real Estate 60.6 137.3
35.2 211.3 66.0 Trading 24.7 30.1 19.0 76.0
59.5
Total sales $171.4 $261.6 $151.7
$567.8 $407.8
Pro forma sales (a) Southern Timber
$27.8 $29.6 $34.8 $102.2 $103.0 Pacific Northwest Timber 16.1 16.9
21.6 52.3 57.8 New Zealand Timber 42.2 47.7 41.1 126.0 121.5 Real
Estate 60.6 7.8 35.2 81.8 66.0 Trading 24.7 30.1 19.0
76.0 59.5
Pro forma sales $171.4 $132.1
$151.7 $438.3 $407.8
Operating income (loss)
Southern Timber $8.2 $11.1 $10.5 $35.0 $34.7 Pacific Northwest
Timber (3.3 ) 1.1 3.1 (0.9) 7.4 New Zealand Timber 6.6 10.0 (0.9 )
21.4 3.8 Real Estate 43.1 105.7 20.0 153.0 34.0 Trading 0.5 0.6 0.4
1.5 0.6 Corporate and other (5.4 ) (6.9 ) (5.3 ) (15.7) (18.5)
Operating income $49.7 $121.6 $27.8
$194.3 $62.0
Pro forma operating income (loss) (a)
Southern Timber $8.2 $11.1 $10.5 $35.0 $34.7 Pacific Northwest
Timber (3.3 ) 1.1 3.1 (0.9) 7.4 New Zealand Timber 6.6 10.0 (0.9 )
21.4 3.8 Real Estate 43.1 4.4 20.0 51.7 34.0 Trading 0.5 0.6 0.4
1.5 0.6 Corporate and other (4.2 ) (6.3 ) (3.8 ) (14.7) (15.4)
Pro forma operating income $50.9 $20.9 $29.3
$94.0 $65.1
Adjusted EBITDA (a) Southern
Timber $18.2 $21.7 $24.9 $72.1 $76.1 Pacific Northwest Timber 3.4
4.8 7.3 14.1 18.3 New Zealand Timber 12.6 16.4 6.1 40.5 26.0 Real
Estate 56.6 7.7 30.9 74.0 54.6 Trading 0.5 0.6 0.4 1.5 0.6
Corporate and other (4.1 ) (6.2 ) (3.8 ) (14.4) (15.2)
Adjusted
EBITDA $87.2 $45.0 $65.8 $187.8 $160.4
(a) Pro forma sales, Pro forma operating income and Adjusted
EBITDA are non-GAAP measures. See Schedule F for definitions and
reconciliations.
E
RAYONIER INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP
MEASURES
September 30, 2016 (unaudited)
(millions of dollars except per share
information)
LIQUIDITY MEASURES: Nine Months Ended
September 30, September 30, 2016 2015
Cash Provided by Operating
Activities $163.9 $143.4 Working capital and other balance
sheet changes (0.2 ) (5.3 ) Capital expenditures (a) (40.2 ) (37.2
)
Cash Available for Distribution (b) $123.5 $100.9
Net income $167.3 $34.5 Interest, net and miscellaneous
expense (income) 24.8 28.8 Income tax expense (benefit) 2.2 (1.3 )
Depreciation, depletion and amortization 83.7 85.8 Non-cash cost of
land and improved development 10.1 9.5 Costs related to shareholder
litigation (c) 2.2 3.1 Gain on foreign currency derivatives (d)
(1.2 ) — Large Dispositions (e) (101.3 ) —
Adjusted
EBITDA $187.8 $160.4 Cash interest paid (f) (23.6 ) (21.9 )
Cash taxes paid (0.5 ) (0.4 ) Capital expenditures (a) (40.2 )
(37.2 )
Cash Available for Distribution (b) $123.5 $100.9
Cash Available for Distribution (b) $123.5 $100.9
Real estate development investments (4.8 ) (2.0 )
Cash Available
for Distribution after real estate development investments
$118.7 $98.9 (a) Capital expenditures exclude
timberland acquisitions of $353.8 million and $88.5 million and
spending on the Rayonier office building of $3.9 million and $0.4
million during the nine months ended September 30, 2016 and
September 30, 2015, respectively. (b) Cash Available for
Distribution (CAD) is a non-GAAP measure that management uses to
measure cash generated during a period that is available for
dividend distribution, repurchase of the Company’s common shares,
debt reduction and strategic acquisitions. CAD is defined as cash
provided by operating activities adjusted for capital spending
(excluding timberland acquisitions and spending on the Rayonier
office building) and working capital and other balance sheet
changes. CAD is not necessarily indicative of the CAD that may be
generated in future periods. (c) “Costs related to shareholder
litigation” include expenses incurred as a result of the securities
litigation, the shareholder derivative demands and the Securities
and Exchange Commission investigation. See Note 10—Contingencies of
Item 8 — Financial Statements and Supplementary Data in the
Company’s most recent Annual Report on Form 10-K. (d) The Company
used foreign exchange derivatives to mitigate the risk of
fluctuations in foreign exchange rates while awaiting the capital
contribution to the New Zealand JV. (e) On April 28, 2016, the
Company completed a disposition of approximately 55,000 acres of
timberland located in Washington for a sales price and gain of
approximately $129.5 million and $101.3 million, respectively. (f)
Cash interest paid is presented net of patronage refunds received
of $0.4 million and $1.3 million for the nine months ended
September 30, 2016 and September 30, 2015, respectively.
F
PRO FORMA SALES (a)
Pacific New Southern Northwest
Zealand Real Three Months Ended Timber
Timber Timber Estate Trading
Total June 30, 2016
Sales
$
29.6
$
16.9
$
47.7
$
137.3
$
30.1
$
261.6
Large Dispositions (b) — — — (129.5 )
— (129.5 )
Pro forma sales $ 29.6 $
16.9 $ 47.7 $ 7.8 $ 30.1 $ 132.1
Pacific New Southern Northwest
Zealand Real Nine Months Ended Timber
Timber Timber Estate Trading
Total September 30, 2016 Sales $ 102.2 $ 52.3
$ 126.0 $ 211.3 $ 76.0 $ 567.8 Large Dispositions (b) —
— — (129.5 ) — (129.5 )
Pro forma sales $ 102.2 $ 52.3 $ 126.0 $ 81.8 $ 76.0
$ 438.3
PRO FORMA NET INCOME (c):
Three Months Ended Nine Months
Ended September 30, September 30, September 30, September
30, 2016 June 30, 2016 2015 2016 2015 $
PerDilutedShare
$
PerDilutedShare
$
PerDilutedShare
$
PerDilutedShare
$
PerDilutedShare
Net income attributable to Rayonier Inc. $39.4 $0.32 $109.8
$0.89 $19.7 $0.16 $163.6 $1.33 $35.9 $0.28 Costs related to
shareholder litigation (d) 1.2 0.01 0.6 0.01 1.5 0.01 2.2 0.03 3.1
0.03 Gain on foreign currency derivatives (e) — — — — — — (1.2 )
(0.01 ) — — Large Dispositions (b) — — (101.3 ) (0.83 ) — — (101.3
) (0.83 ) — —
Expense related to the write-off of
capitalized financing costs
— — — — 0.4 — — —
0.4 —
Pro forma net income $40.6 $0.33
$9.1 $0.07 $21.6 $0.17 $63.3
$0.52 $39.4 $0.31
F
PRO FORMA OPERATING INCOME (LOSS) AND ADJUSTED EBITDA
(f)(g):
Pacific New
Corporate Southern Northwest Zealand
Real and Three Months Ended Timber
Timber Timber Estate Trading
other Total September 30, 2016 Operating
income (loss) $8.2 ($3.3 ) $6.6 $43.1 $0.5 ($5.4 ) $49.7 Costs
related to shareholder litigation (d) — — — —
— 1.2 1.2 Pro forma operating income
(loss) $8.2 ($3.3 ) $6.6 $43.1 $0.5 ($4.2 ) $50.9 Depreciation,
depletion and amortization 10.0 6.7 6.0 9.2 — 0.1 32.0 Non-cash
cost of land and improved development — — —
4.3 — — 4.3 Adjusted EBITDA $18.2
$3.4 $12.6 $56.6 $0.5 ($4.1 )
$87.2
June 30, 2016 Operating income (loss)
$11.1 $1.1 $10.0 $105.7 $0.6 ($6.9 ) $121.6 Costs related to
shareholder litigation (d) — — — — — 0.6 0.6 Large Dispositions (b)
— — — (101.3 ) — — (101.3 ) Pro
forma operating income (loss) $11.1 $1.1 $10.0 $4.4 $0.6 ($6.3 )
$20.9 Depreciation, depletion and amortization 10.6 3.7 6.4 1.6 —
0.1 22.4 Non-cash cost of land and improved development — —
— 1.7 — — 1.7 Adjusted
EBITDA $21.7 $4.8 $16.4 $7.7 $0.6
($6.2 ) $45.0
September 30, 2015
Operating income (loss) $10.5 $3.1 ($0.9 ) $20.0 $0.4 ($5.3 ) $27.8
Costs related to shareholder litigation (d) — — —
— — 1.5 1.5 Pro forma operating
income (loss) $10.5 $3.1 ($0.9 ) $20.0 $0.4 ($3.8 ) $29.3
Non-operating expense — — — — — (0.1 ) (0.1 ) Depreciation,
depletion and amortization 14.4 4.2 7.0 6.3 — 0.1 32.0 Non-cash
cost of land and improved development — — —
4.6 — — 4.6 Adjusted EBITDA $24.9
$7.3 $6.1 $30.9 $0.4 ($3.8 )
$65.8
Pacific New
Corporate Southern
Northwest Zealand Real and Nine
Months Ended Timber Timber Timber
Estate Trading other Total September
30, 2016 Operating income (loss) $35.0 ($0.9 ) $21.4 $153.0
$1.5 ($15.7 ) $194.3 Costs related to shareholder litigation (d) —
— — — — 2.2 2.2 Gain on foreign currency derivatives (e) — — — — —
(1.2 ) (1.2 ) Large Dispositions (b) — — —
(101.3 ) — — (101.3 ) Pro forma operating income
(loss) $35.0 ($0.9 ) $21.4 $51.7 $1.5 ($14.7 ) $94.0 Depreciation,
depletion and amortization 37.1 15.0 17.3 14.0 — 0.3 83.7 Non-cash
cost of land and improved development — — 1.8
8.3 — — 10.1 Adjusted EBITDA $72.1
$14.1 $40.5 $74.0 $1.5 ($14.4 )
$187.8
September 30, 2015 Operating income
(loss) $34.7 $7.4 $3.8 $34.0 $0.6 ($18.5 ) $62.0 Costs related to
shareholder litigation (d) — — — — —
3.1 3.1 Pro forma operating income (loss)
$34.7 $7.4 $3.8 $34.0 $0.6 ($15.4 ) $65.1 Depreciation, depletion
and amortization 41.4 10.9 22.2 11.1 — 0.2 85.8 Non-cash cost of
land and improved development — — — 9.5
— — 9.5 Adjusted EBITDA $76.1 $18.3
$26.0 $54.6 $0.6 ($15.2 ) $160.4
F
ADJUSTED EBITDA GUIDANCE (g): 2016
Guidance Prior Guidance Net Income to
Adjusted EBITDA Reconciliation Net income
$208.0
-
$214.0
$45.0 - $55.0 Interest, net 33.0 - 33.2 28.5 - 29.3 Income tax
expense (benefit) 2.5 - 3.5 0.5 - 1.7 Depreciation, depletion and
amortization
113.0
-
115.0
104.0 - 109.0 Non-cash cost of land and improved development
10.0
-
12.0
15.0 - 17.0 Costs related to shareholder litigation (d) 2.7 - 3.5
2.0 - 3.0 Gain on foreign currency derivatives (e) (1.2 ) - (1.2 )
— — Large Dispositions (b) (140.0 ) - (145.0 ) — —
Adjusted EBITDA $228.0 - $235.0 $195.0 -
$215.0 (a) Pro forma sales is defined as revenue adjusted
for Large Dispositions. Rayonier believes that this non-GAAP
financial measure provides investors with useful information to
evaluate our core business operations because it excludes specific
items that are not indicative of ongoing operating results. (b)
“Large Dispositions” are defined as transactions involving the sale
of timberland that exceed $20 million in size and do not have any
identified HBU premium relative to timberland value. On April 28,
2016, the Company completed a disposition of approximately 55,000
acres located in Washington for a sales price and gain of
approximately $129.5 million and $101.3 million, respectively. (c)
Pro forma net income is defined as net
income attributable to Rayonier Inc. adjusted for costs related to
shareholder litigation, the gain on foreign currency derivatives,
Large Dispositions and expense related to the write-off of
capitalized financing costs. Rayonier believes that this non-GAAP
financial measure provides investors with useful information to
evaluate our core business operations because it excludes specific
items that are not indicative of ongoing operating results.
(d) “Costs related to shareholder litigation” includes expenses
incurred as a result of the securities litigation, the shareholder
derivative demands and the Securities and Exchange Commission
investigation. See Note 10—Contingencies of Item 8 — Financial
Statements and Supplementary Data in the Company’s most recent
Annual Report on Form 10-K. (e) The Company used foreign exchange
derivatives to mitigate the risk of fluctuations in foreign
exchange rates while awaiting the capital contribution to the New
Zealand JV. (f) Pro forma operating income is defined as operating
income adjusted for costs related to shareholder litigation, the
gain on foreign currency derivatives and Large Dispositions.
Rayonier believes that this non-GAAP financial measure provides
investors with useful information to evaluate our core business
operations because it excludes specific items that are not
indicative of the ongoing operating results. (g) Adjusted EBITDA is
defined as earnings before interest, taxes, depreciation,
depletion, amortization, the non-cash cost of land and improved
development, costs related to shareholder litigation, the gain on
foreign currency derivatives and Large Dispositions. Adjusted
EBITDA is a non-GAAP measure that management uses to make strategic
decisions about the business and that investors can use to evaluate
the operational performance of the assets under management. It
removes the impact of specific items that management believes do
not directly reflect the core business operations on an ongoing
basis.
F
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161102006814/en/
Rayonier Inc.InvestorsMark McHugh, 904-357-3757orMediaRoseann
Wentworth, 904-357-9185roseann.wentworth@rayonier.com
Rayonier (NYSE:RYN)
Gráfico Histórico do Ativo
De Jun 2024 até Jul 2024
Rayonier (NYSE:RYN)
Gráfico Histórico do Ativo
De Jul 2023 até Jul 2024