- First quarter net income attributable to Rayonier of $29.3
million ($0.20 per share) on revenues of $222.0 million
- First quarter operating income of $45.3 million and Adjusted
EBITDA of $98.1 million
- First quarter cash provided by operations of $49.7 million and
cash available for distribution (CAD) of $64.5 million
Rayonier Inc. (NYSE:RYN) today reported first quarter net income
attributable to Rayonier of $29.3 million, or $0.20 per share, on
revenues of $222.0 million. This compares to net income
attributable to Rayonier of $10.8 million, or $0.08 per share, on
revenues of $191.4 million in the prior year quarter.
The following table summarizes the current quarter and
comparable prior year period results:
Three Months Ended
(millions of dollars, except earnings per
share (EPS))
March 31, 2022
March 31, 2021
$
EPS
$
EPS
Revenues
$222.0
$191.4
Sales attributable to noncontrolling
interests in Timber Funds
—
(11.9
)
Pro forma revenues1
$222.0
$179.5
Net income attributable to Rayonier
$29.3
$0.20
$10.8
$0.08
First quarter operating income was $45.3 million versus $28.5
million in the prior year period. Prior year first quarter
operating income included $1.1 million of operating income
attributable to noncontrolling interests in the Timber Funds
segment. Excluding this item, pro forma operating income1 was $27.4
million in the prior year period. First quarter Adjusted EBITDA1
was $98.1 million versus $69.5 million in the prior year
period.
The following table summarizes operating income, pro forma
operating income1 and Adjusted EBITDA1 for the current quarter and
comparable prior year period:
Three Months Ended March
31,
Operating Income
Pro forma Operating
Income1
Adjusted EBITDA1
(millions of dollars)
2022
2021
2022
2021
2022
2021
Southern Timber
$30.3
$17.3
$30.3
$17.3
$48.4
$31.7
Pacific Northwest Timber
6.6
1.3
6.6
1.3
21.5
17.6
New Zealand Timber
5.4
14.0
5.4
14.0
10.4
21.2
Timber Funds
—
1.5
—
0.4
—
1.0
Real Estate
10.2
1.7
10.2
1.7
24.7
5.1
Trading
0.4
0.2
0.4
0.2
0.4
0.2
Corporate and Other
(7.6
)
(7.6
)
(7.6
)
(7.6
)
(7.2
)
(7.3
)
Total
$45.3
$28.5
$45.3
$27.4
$98.1
$69.5
Cash provided by operating activities was $49.7 million versus
$53.9 million in the prior year period. Cash available for
distribution (CAD)1 of $64.5 million increased $17.2 million versus
the prior year period primarily due to higher Adjusted EBITDA1
($28.6 million), partially offset by higher cash taxes paid ($9.2
million), higher cash interest paid ($1.1 million) and higher
capital expenditures ($1.1 million).
“We are pleased with our strong start to 2022,” said David
Nunes, President and CEO. “Adjusted EBITDA of $98.1 million was 41%
higher than the prior year quarter, as favorable results in our
Southern Timber, Pacific Northwest Timber and Real Estate segments
more than offset lower Adjusted EBITDA in our New Zealand Timber
segment.”
“We achieved record quarterly Adjusted EBITDA in both of our
U.S. timber segments, driven primarily by continued pricing
momentum. Southern Timber Adjusted EBITDA improved 53% over the
prior year quarter, as strong demand drove 31% higher net stumpage
prices and favorable logging conditions led to a 25% increase in
harvest volumes. In Pacific Northwest Timber, Adjusted EBITDA
improved 22% over the prior year quarter, as a 17% increase in
weighted-average log prices more than offset higher costs and a 6%
reduction in harvest volumes.”
“New Zealand Timber Adjusted EBITDA declined 51% versus the
prior year quarter, as modestly higher weighted-average log prices
were more than offset by 14% lower harvest volumes, compressed
margins due to significantly higher shipping costs, and an
unfavorable exchange rate variance.”
“Real Estate segment Adjusted EBITDA was $19.6 million above the
prior year quarter, driven by a significant increase in acres sold,
partially offset by a modest decrease in weighted-average prices
due to the mix of acreage sold.”
Southern Timber
First quarter sales of $76.8 million increased $25.1 million, or
49%, versus the prior year period. Harvest volumes increased 25% to
1.90 million tons versus 1.51 million tons in the prior year
period, as drier ground conditions enabled stumpage customers to
ramp up production to meet strong demand. Average pine sawtimber
stumpage prices increased 29% to $35.46 per ton versus $27.51 per
ton in the prior year period, driven by strong domestic lumber
demand coupled with elevated chip-n-saw pricing due to increased
competition from pulp mills. Average pine pulpwood stumpage prices
increased 41% to $24.11 per ton versus $17.10 per ton in the prior
year period, reflecting strong competition across our wood baskets
as customers looked to secure supply and replenish low mill
inventories. Overall, weighted-average stumpage prices (including
hardwood) increased 31% to $27.94 per ton versus $21.35 per ton in
the prior year period. Operating income of $30.3 million increased
$13.0 million versus the prior year period due to higher net
stumpage realizations ($12.5 million) and higher volumes ($4.5
million), partially offset by higher costs ($2.1 million), lower
non-timber income ($1.8 million) and higher depletion rates ($0.1
million).
First quarter Adjusted EBITDA1 of $48.4 million was 53%, or
$16.7 million, above the prior year period.
Pacific Northwest Timber
First quarter sales of $46.3 million increased $4.8 million, or
11%, versus the prior year period, notwithstanding a decline in
harvest volumes of 6% to 505,000 tons versus 536,000 tons in the
prior year period. Average delivered sawtimber prices increased 16%
to $105.69 per ton versus $90.98 per ton in the prior year period,
driven by strong domestic lumber demand. Average delivered pulpwood
prices increased 28% to $37.69 per ton versus $29.36 per ton in the
prior year period, primarily driven by improved demand due to the
restart of idled pulp mill capacity in the region. Operating income
of $6.6 million improved $5.3 million versus the prior year period
due to higher net stumpage realizations ($5.8 million) and lower
depletion rates ($0.4 million), partially offset by higher costs
($0.5 million), lower volumes ($0.3 million) and lower non-timber
income ($0.1 million).
First quarter Adjusted EBITDA1 of $21.5 million was 22%, or $3.9
million, above the prior year period.
New Zealand Timber
First quarter sales of $51.4 million decreased $6.2 million, or
11%, versus the prior year period. Harvest volumes decreased 14% to
515,000 tons versus 599,000 tons in the prior year period, as
production at the beginning of the year was deferred in response to
port congestion and elevated log inventories in China. Average
delivered prices for export sawtimber increased 5% to $127.59 per
ton versus $121.65 per ton in the prior year period. The increase
in export sawtimber prices versus the prior year period reflected
the ability of log exporters to partially pass on higher costs to
customers, as well as the newly implemented restriction on
competing log imports into China from Russia. However, favorable
export pricing was more than offset by higher shipping and
demurrage costs due to ongoing supply chain and port congestion
issues. Average delivered prices for domestic sawtimber decreased
6% to $75.99 per ton versus $80.95 per ton in the prior year
period. The decrease in domestic sawtimber prices (in U.S. dollar
terms) was driven by the decline in the NZ$/US$ exchange rate
(US$0.67 per NZ$1.00 versus US$0.72 per NZ$1.00). Excluding the
impact of foreign exchange rates, domestic sawtimber prices
improved 1% versus the prior year period. Operating income of $5.4
million decreased $8.6 million versus the prior year period due to
lower net stumpage realizations ($6.2 million), lower volumes ($2.6
million), higher costs ($0.6 million) and unfavorable foreign
exchange impacts ($1.5 million), partially offset by higher carbon
credit sales ($1.5 million) and lower depletion rates ($0.8
million).
First quarter Adjusted EBITDA1 of $10.4 million was 51%, or
$10.8 million, below the prior year period.
Real Estate
First quarter sales of $34.2 million increased $23.7 million
versus the prior year period, while operating income of $10.2
million increased $8.5 million versus the prior year period. Higher
segment results in the current year period were driven by a
significant increase in the number of acres sold (8,734 acres sold
versus 2,395 acres sold in the prior year period), partially offset
by a decrease in weighted-average prices ($3,815 per acre versus
$4,183 per acre in the prior year period).
Improved Development sales of $5.0 million included $3.6 million
from the Wildlight development project north of Jacksonville,
Florida and $1.4 million from the Richmond Hill development project
(which has now been branded as Heartwood) south of Savannah,
Georgia. Sales in Wildlight consisted of 52 residential lots,
reflecting an average price of $70,000 per lot or $339,000 per
acre. Sales in Richmond Hill (Heartwood) included ten residential
lots for $0.4 million (an average price of $44,000 per lot or
$251,000 per acre) and a 4-acre commercial property for $0.9
million ($246,000 per acre). This compares to prior year period
Improved Development sales of $0.3 million.
There were no Unimproved Development sales in the first quarter
or the prior year period.
Rural sales of $16.9 million consisted of 4,751 acres at an
average price of $3,567 per acre. This compares to prior year
period sales of $9.8 million, which consisted of 2,394 acres at an
average price of $4,079 per acre.
Timberland & Non-Strategic sales of $11.4 million consisted
of 3,966 acres at an average price of $2,874 per acre. There were
no Timberland & Non-Strategic sales in the prior year
period.
First quarter Adjusted EBITDA1 of $24.7 million was $19.6
million above the prior year period.
Trading
First quarter sales of $13.4 million decreased $3.2 million
versus the prior year period primarily due to lower volumes,
partially offset by higher prices. Sales volumes decreased 21% to
112,000 tons versus 141,000 tons in the prior year period,
reflecting elevated log inventories in China and constrained export
market demand. The Trading segment generated operating income of
$0.4 million versus $0.2 million in the prior year period.
Other Items
First quarter corporate and other operating expenses of $7.6
million were flat versus the prior year period.
First quarter interest expense of $8.3 million decreased $1.7
million versus the prior year period due to lower average
outstanding debt and lower borrowing costs.
First quarter income tax expense of $5.5 million increased $2.1
million versus the prior year period. The New Zealand subsidiary is
generally the primary driver of income tax expense, although the
increase in the first quarter was attributable to the retirement of
an installment note in the taxable REIT subsidiary.
In September 2020, we established an at-the-market (ATM) equity
offering program under which we may sell common shares, from time
to time, having an aggregate sales price of up to $300 million.
There were approximately 726,000 shares issued under the ATM
program during the three months ended March 31, 2022 at an average
price of $41.46 per share.
Outlook
“Following a solid start to the year, we are well on track to
achieve our prior full-year Adjusted EBITDA guidance,” added
Nunes.
“In our Southern Timber segment, we expect to achieve our
full-year volume guidance and are encouraged by the year-over-year
pricing gains that have been realized across our operating areas.
Overall, we continue to expect a significant increase in full-year
Adjusted EBITDA from this segment as compared to the prior year.
However, we anticipate lower quarterly harvest volumes for the
remainder of the year as compared to the first quarter, as we
experienced above-average stumpage removals to start the year.
Also, while we expect net stumpage realizations to remain well
above prior year levels, we anticipate modestly lower
weighted-average prices for the remainder of the year as compared
to the first quarter due to higher mill inventories, a higher
proportion of thinning volume, and a less favorable geographic
mix.”
“In our Pacific Northwest Timber segment, we expect to achieve
our full-year volume guidance, although we expect lower quarterly
harvest volumes for the balance of the year following strong
removals in the first quarter. We further expect that
weighted-average log prices will remain near first quarter levels
for the balance of the year, driven by continued strong sawtimber
demand and improving pulpwood markets.”
“In our New Zealand Timber segment, we expect to achieve our
full-year volume guidance with increased quarterly harvest volumes
for the balance of the year. While a significant level of
uncertainty remains around the ongoing COVID-19 related disruptions
in China, we expect that once demand stabilizes, constrained log
supplies will drive export sawtimber prices higher. We further
expect that domestic sawtimber and pulpwood pricing will remain
relatively flat for the remainder of the year. Consistent with our
previous guidance, we anticipate a higher Adjusted EBITDA
contribution from this segment in the second half versus the first
half of the year.”
“In our Real Estate segment, we expect to achieve our full-year
Adjusted EBITDA guidance. Following strong Real Estate results in
the first quarter, we anticipate lower quarterly results for the
balance of the year.”
Conference Call
A conference call and live audio webcast will be held on
Thursday, May 5, 2022 at 10:00 AM (ET) to discuss these
results.
Access to the live audio 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
888-604-9366 (domestic) or 517-308-9338 (international), passcode:
RAYONIER. A replay of the conference call will be available one
hour following the call until Sunday, June 5, 2022 by dialing
800-568-4850 (domestic) or 203-369-3813 (international), passcode:
5522.
Complimentary copies of Rayonier press releases and other
financial documents are also available by calling (904)
357-9100.
1“Pro forma net income, Pro forma revenues (sales), Pro forma
operating income (loss), 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 March
31, 2022, Rayonier owned or leased under long-term agreements
approximately 2.7 million acres of timberlands located in the U.S.
South (1.80 million acres), U.S. Pacific Northwest (486,000 acres)
and New Zealand (419,000 acres). More information is available at
www.rayonier.com.
_______________________________________________________________________
Forward-Looking Statements - Certain statements in this
press release regarding anticipated financial outcomes including
Rayonier’s earnings guidance, if any, business and market
conditions, outlook, expected dividend rate, Rayonier’s business
strategies, expected harvest schedules, timberland acquisitions and
dispositions, 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, including any downturn
in the housing market; entry of new competitors into our markets;
changes in global economic conditions and world events, including
the war in Ukraine; business disruptions arising from public health
crises and outbreaks of communicable diseases, including the
current outbreak of the virus known as the novel coronavirus;
fluctuations in demand for our products in Asia, and especially
China; the uncertainties of potential impacts of climate-related
initiatives; the cost and availability of third party logging,
trucking and ocean freight 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, endangered species and development of real
estate generally, 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; the lengthy,
uncertain and costly process associated with the ownership,
entitlement and development of real estate, especially in Florida
and Washington, including changes in law, policy and political
factors beyond our control; the availability of financing for real
estate development and mortgage loans; 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; and
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.
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
(loss),” “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
March 31, 2022
(unaudited)
(millions of dollars, except per
share information)
Three Months Ended
March 31,
December 31,
March 31,
2022
2021
2021
SALES
$222.0
$262.0
$191.4
Costs and Expenses
Cost of sales
(161.0
)
(217.2
)
(151.3
)
Selling and general expenses
(14.7
)
(15.9
)
(14.0
)
Other operating (expense) income, net
(1.0
)
4.6
2.4
OPERATING INCOME
45.3
33.5
28.5
Interest expense
(8.3
)
(10.6
)
(10.0
)
Interest and other miscellaneous (expense)
income, net
(0.5
)
0.2
—
INCOME BEFORE INCOME TAXES
36.5
23.1
18.5
Income tax expense
(5.5
)
(1.6
)
(3.5
)
NET INCOME
31.0
21.5
15.0
Less: Net income attributable to
noncontrolling interests in the operating partnership
(0.7
)
(0.2
)
(0.4
)
Less: Net income attributable to
noncontrolling interests in consolidated affiliates
(1.0
)
(12.6
)
(3.8
)
NET INCOME ATTRIBUTABLE TO RAYONIER
INC.
$29.3
$8.7
$10.8
EARNINGS PER COMMON SHARE
Basic earnings per share attributable to
Rayonier Inc.
$0.20
$0.06
$0.08
Diluted earnings per share attributable to
Rayonier Inc.
$0.20
$0.06
$0.08
Pro forma net income per share (a)
$0.20
$0.01
$0.08
Weighted Average Common Shares used for
determining
Basic EPS
145,430,171
143,968,773
137,870,821
Diluted EPS (b)
149,547,076
148,079,383
142,558,797
(a)
Pro forma net income per share is a
non-GAAP measure. See Schedule F for definition and reconciliation
to the nearest GAAP measure.
(b)
Diluted earnings per share is calculated
based on the weighted average number of shares of common stock
outstanding combined with the incremental weighted average number
of shares that would have been outstanding assuming all potentially
dilutive securities (including Redeemable Operating Partnership
Units) were converted into shares of common stock at the earliest
date possible. As of March 31, 2022, there were 146,107,688 common
shares and 3,313,206 Redeemable Operating Partnership Units
outstanding.
A
RAYONIER INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
March 31, 2022
(unaudited)
(millions of dollars)
March 31,
December 31,
2022
2021
Assets
Cash and cash equivalents (excluding
Timber Funds)
$256.5
$358.7
Cash and cash equivalents (Timber
Funds)
3.2
3.5
Restricted cash (Timber Funds)
5.5
6.3
Assets held for sale
2.5
5.1
Other current assets
107.4
77.9
Timber and timberlands, net of depletion
and amortization
2,869.2
2,895.0
Higher and better use timberlands and real
estate development investments
111.4
106.9
Property, plant and equipment
44.6
44.5
Less - accumulated depreciation
(15.7
)
(14.9
)
Net property, plant and equipment
28.9
29.6
Restricted cash (excluding Timber
Funds)
0.6
0.6
Right-of-use assets
104.2
101.8
Other assets
70.5
51.0
$3,559.9
$3,636.4
Liabilities, Noncontrolling Interests
in the Operating Partnership and Shareholders’ Equity
Current maturities of long-term debt
(excluding Timber Funds)
2.1
125.0
Distribution payable (Timber Funds)
5.5
6.3
Other current liabilities
85.2
100.4
Long-term debt (excluding Timber
Funds)
1,243.7
1,242.8
Long-term lease liability
95.5
93.4
Other non-current liabilities
110.1
119.1
Noncontrolling interests in the operating
partnership
136.2
133.8
Total Rayonier Inc. shareholders’
equity
1,837.0
1,771.8
Noncontrolling interests in consolidated
affiliates
44.6
43.8
Total shareholders’ equity
1,881.6
1,815.6
$3,559.9
$3,636.4
B
RAYONIER INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
March 31, 2022
(unaudited)
(millions of dollars, except
share information)
Common Shares
Retained Earnings
Accumulated Other
Comprehensive (Loss) Income
Noncontrolling Interests in
Consolidated Affiliates
Shareholders’ Equity
Shares
Amount
Balance, January 1, 2022
145,372,961
$1,389.1
$402.3
($19.6
)
$43.8
$1,815.6
Issuance of shares under the
“at-the-market” (ATM) equity offering program, net of commissions
and offering costs of $0.3 million
726,248
29.8
—
—
—
29.8
Net income
—
—
30.0
—
1.0
31.0
Net income attributable to noncontrolling
interests in the Operating Partnership
—
—
(0.7
)
—
—
(0.7
)
Dividends ($0.27 per share)
—
—
(39.9
)
—
—
(39.9
)
Issuance of shares under incentive stock
plans
11,364
0.4
—
—
—
0.4
Stock-based compensation
—
2.8
—
—
—
2.8
Adjustment of noncontrolling interests in
the Operating Partnership
—
—
(2.6
)
—
—
(2.6
)
Other (a)
(2,885
)
(0.2
)
—
45.6
(0.2
)
45.2
Balance, March 31, 2022
146,107,688
$1,421.9
$389.1
$26.0
$44.6
$1,881.6
Common Shares
Retained Earnings
Accumulated Other
Comprehensive (Loss) Income
Noncontrolling Interests in
Consolidated Affiliates
Shareholders’ Equity
Shares
Amount
Balance, January 1, 2021
137,678,822
$1,101.7
$446.3
($73.9
)
$388.5
$1,862.6
Issuance of shares under the
“at-the-market” (ATM) equity offering program, net of commissions
and offering costs of $0.2 million
1,107,814
36.7
—
—
—
36.7
Net income
—
—
11.2
—
3.8
15.0
Net income attributable to noncontrolling
interests in the Operating Partnership
—
—
(0.4
)
—
—
(0.4
)
Dividends ($0.27 per share)
—
—
(37.5
)
—
—
(37.5
)
Issuance of shares under incentive stock
plans
39,140
1.2
—
—
—
1.2
Stock-based compensation
—
2.1
—
—
—
2.1
Measurement period adjustment of
noncontrolling
interests in consolidated affiliates
—
—
—
—
0.7
0.7
Adjustment of noncontrolling interests in
the Operating Partnership
—
—
(11.9
)
—
—
(11.9
)
Other (a)
145,114
4.5
—
48.8
(11.9
)
41.4
Balance, March 31, 2021
138,970,890
$1,146.2
$407.7
($25.1
)
$381.1
$1,909.9
(a)
Primarily includes shares purchased from
employees in non-open market transactions to pay withholding taxes
associated with the vesting of shares granted under the Company’s
Incentive Stock Plan, amortization of pension and post-retirement
plan liabilities, foreign currency translation adjustments,
mark-to-market adjustments of qualifying cash flow hedges,
distributions to noncontrolling interests in consolidated
affiliates and the allocation of other comprehensive income to
noncontrolling interests in the operating partnership. The three
months ended March 31, 2022 also includes the redemption of 2,535
Redeemable Operating Partnership Units, respectively, for an equal
number of Rayonier Inc. common shares.
C
RAYONIER INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
March 31, 2022
(unaudited)
(millions of dollars)
Three Months Ended March 31,
2022
2021
Cash provided by operating
activities:
Net income
$31.0
$15.0
Depreciation, depletion and
amortization
47.4
45.2
Non-cash cost of land and improved
development
5.4
1.8
Stock-based incentive compensation
expense
2.8
2.1
Deferred income taxes
(8.0
)
(1.1
)
Other items to reconcile net income to
cash provided by operating activities
(2.1
)
(3.3
)
Changes in working capital and other
assets and liabilities
(26.8
)
(5.8
)
49.7
53.9
Cash used for investing
activities:
Capital expenditures
(15.6
)
(15.8
)
Real estate development investments
(3.1
)
(3.0
)
Purchase of timberlands
(2.8
)
(29.9
)
Other
2.6
4.3
(18.9
)
(44.4
)
Cash used for financing
activities:
Net decrease in debt
(122.9
)
—
Dividends paid
(39.4
)
(37.5
)
Distributions to noncontrolling interests
in the operating partnership
(0.9
)
(1.2
)
Proceeds from the issuance of common
shares under incentive stock plan
0.6
1.2
Proceeds from the issuance of common
shares under the “at-the-market” (ATM) equity offering program, net
of commissions and offering costs
30.9
32.5
Distributions to noncontrolling interests
in consolidated affiliates
(2.7
)
(8.8
)
Other
(0.3
)
—
(134.7
)
(13.8
)
Effect of exchange rate changes on cash
and restricted cash
0.6
(0.1
)
Cash, cash equivalents and restricted
cash:
Change in cash, cash equivalents and
restricted cash
(103.3
)
(4.4
)
Balance, beginning of year
369.1
87.5
Balance, end of period
$265.8
$83.1
D
RAYONIER INC. AND
SUBSIDIARIES
BUSINESS SEGMENT SALES, PRO
FORMA SALES, OPERATING INCOME,
PRO FORMA OPERATING INCOME AND
ADJUSTED EBITDA
March 31, 2022
(unaudited)
(millions of dollars)
Three Months Ended
March 31,
December 31,
March 31,
2022
2021
2021
Sales
Southern Timber
$76.8
$58.7
$51.7
Pacific Northwest Timber
46.3
34.7
41.5
New Zealand Timber
51.4
67.5
57.6
Timber Funds
—
71.3
14.9
Real Estate
34.2
11.5
10.5
Trading
13.4
18.6
16.7
Intersegment Eliminations
(0.1
)
(0.3
)
(1.5
)
Sales
$222.0
$262.0
$191.4
Pro forma sales (a)
Southern Timber
$76.8
$58.7
$51.7
Pacific Northwest Timber
46.3
34.7
41.5
New Zealand Timber
51.4
67.5
57.6
Timber Funds
—
0.3
3.0
Real Estate
34.2
11.5
10.5
Trading
13.4
18.6
16.7
Intersegment Eliminations
(0.1
)
(0.3
)
(1.5
)
Pro forma sales
$222.0
$191.0
$179.5
Operating income (loss)
Southern Timber
$30.3
$19.0
$17.3
Pacific Northwest Timber
6.6
1.5
1.3
New Zealand Timber
5.4
3.6
14.0
Timber Funds
—
18.4
1.5
Real Estate
10.2
(0.3
)
1.7
Trading
0.4
(0.5
)
0.2
Corporate and Other
(7.6
)
(8.2
)
(7.6
)
Operating income
$45.3
$33.5
$28.5
Pro forma operating income (loss)
(a)
Southern Timber
$30.3
$19.0
$17.3
Pacific Northwest Timber
6.6
1.5
1.3
New Zealand Timber
5.4
3.6
14.0
Timber Funds
—
(0.7
)
0.4
Real Estate
10.2
(0.3
)
1.7
Trading
0.4
(0.5
)
0.2
Corporate and Other
(7.6
)
(8.2
)
(7.6
)
Pro forma operating income
$45.3
$14.4
$27.4
Adjusted EBITDA (a)
Southern Timber
$48.4
$33.6
$31.7
Pacific Northwest Timber
21.5
13.2
17.6
New Zealand Timber
10.4
9.8
21.2
Timber Funds
—
(0.6
)
1.0
Real Estate
24.7
2.8
5.1
Trading
0.4
(0.5
)
0.2
Corporate and Other
(7.2
)
(7.9
)
(7.3
)
Adjusted EBITDA
$98.1
$50.4
$69.5
(a)
Pro forma sales, Pro forma operating
income (loss) and Adjusted EBITDA are non-GAAP measures. See
Schedule F for definitions and reconciliations.
E
RAYONIER INC. AND
SUBSIDIARIES
RECONCILIATION OF NON-GAAP
MEASURES
March 31, 2022
(unaudited)
(millions of dollars, except per
share information)
LIQUIDITY MEASURES:
Three Months Ended
March 31,
March 31,
2022
2021
Cash Provided by Operating
Activities
$49.7
$53.9
Working capital and other balance sheet
changes
30.4
13.8
Cash Available for Distribution
attributable to NCI in Timber Funds
—
(4.6
)
Capital expenditures (a)
(15.6
)
(15.8
)
Cash Available for Distribution
(b)
$64.5
$47.3
Net Income
$31.0
$15.0
Operating income attributable to NCI in
Timber Funds
—
(1.1
)
Interest, net attributable to NCI in
Timber Funds
—
0.1
Net Income (Excluding NCI in Timber
Funds)
$31.0
$14.0
Interest, net and miscellaneous income
attributable to Rayonier
8.2
9.9
Income tax expense attributable to
Rayonier
5.5
3.5
Depreciation, depletion and amortization
attributable to Rayonier
47.4
40.3
Non-cash cost of land and improved
development
5.4
1.8
Non-operating expense
0.6
—
Adjusted EBITDA (c)
$98.1
$69.5
Cash interest paid attributable to
Rayonier (d)
(3.9
)
(2.8
)
Cash taxes paid attributable to
Rayonier
(14.0
)
(4.8
)
Capital expenditures attributable to
Rayonier (a)
(15.6
)
(14.5
)
Cash Available for Distribution
(b)
$64.5
$47.3
Cash Available for Distribution
(b)
$64.5
$47.3
Real estate development investments
(3.1
)
(3.0
)
Cash Available for Distribution after
real estate development investments
$61.4
$44.3
PRO FORMA SALES (e):
Three Months Ended
Southern Timber
Pacific Northwest
Timber
New Zealand Timber
Timber Funds
Real Estate
Trading
Intersegment
Eliminations
Total
March 31, 2022
Sales
$76.8
$46.3
$51.4
—
$34.2
$13.4
($0.1
)
$222.0
Pro forma sales
$76.8
$46.3
$51.4
—
$34.2
$13.4
($0.1
)
$222.0
December 31, 2021
Sales
$58.7
$34.7
$67.5
$71.3
$11.5
$18.6
($0.3
)
$262.0
Sales attributable to noncontrolling
interests in Timber Funds
—
—
—
(57.0
)
—
—
—
(57.0
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
(14.0
)
—
—
—
(14.0
)
Pro forma sales
$58.7
$34.7
$67.5
$0.3
$11.5
$18.6
($0.3
)
$191.0
March 31, 2021
Sales
$51.7
$41.5
$57.6
$14.9
$10.5
$16.7
($1.5
)
$191.4
Sales attributable to noncontrolling
interests in Timber Funds
—
—
—
(11.9
)
—
—
—
(11.9
)
Pro forma sales
$51.7
$41.5
$57.6
$3.0
$10.5
$16.7
($1.5
)
$179.5
PRO FORMA NET INCOME (g):
Three Months Ended
March 31, 2022
December 31, 2021
March 31, 2021
$
Per Diluted Share
$
Per Diluted Share
$
Per Diluted Share
Net Income Attributable to Rayonier
Inc.
$29.3
$0.20
$8.7
$0.06
$10.8
$0.08
Gain on investment in Timber Funds (h)
—
—
(3.8
)
(0.03
)
—
—
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
(3.1
)
(0.02
)
—
—
Pro forma net income adjustments
attributable to noncontrolling interests in the operating
partnership (i)
—
—
0.2
—
—
—
Pro Forma Net Income
$29.3
$0.20
$2.0
$0.01
$10.8
$0.08
PRO FORMA OPERATING INCOME (LOSS) AND
ADJUSTED EBITDA (j) (c):
Three Months Ended
Southern Timber
Pacific Northwest
Timber
New Zealand Timber
Timber Funds
Real Estate
Trading
Corporate and Other
Total
March 31, 2022
Operating income
$30.3
$6.6
$5.4
—
$10.2
$0.4
($7.6
)
$45.3
Depreciation, depletion and
amortization
18.1
14.9
5.0
—
9.1
—
0.3
47.4
Non-cash cost of land and improved
development
—
—
—
—
5.4
—
—
5.4
Adjusted EBITDA
$48.4
$21.5
$10.4
—
$24.7
$0.4
($7.2
)
$98.1
December 31, 2021
Operating income (loss)
$19.0
$1.5
$3.6
$18.4
($0.3
)
($0.5
)
($8.2
)
$33.5
Gain on investment in Timber Funds (h)
—
—
—
(3.8
)
—
—
—
(3.8
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
(3.1
)
—
—
—
(3.1
)
Operating income attributable to NCI in
Timber Funds
—
—
—
(12.3
)
—
—
—
(12.3
)
Pro forma operating income (loss)
$19.0
$1.5
$3.6
($0.7
)
($0.3
)
($0.5
)
($8.2
)
$14.4
Depreciation, depletion and
amortization
14.6
11.7
6.2
0.2
0.9
—
0.3
33.9
Non-cash cost of land and improved
development
—
—
—
—
2.2
—
—
2.2
Adjusted EBITDA
$33.6
$13.2
$9.8
($0.6
)
$2.8
($0.5
)
($7.9
)
$50.4
March 31, 2021
Operating income
$17.3
$1.3
$14.0
$1.5
$1.7
$0.2
($7.6
)
$28.5
Operating income attributable to NCI in
Timber Funds
—
—
—
(1.1
)
—
—
—
(1.1
)
Pro forma operating income
$17.3
$1.3
$14.0
$0.4
$1.7
$0.2
($7.6
)
$27.4
Depreciation, depletion and
amortization
14.4
16.3
7.2
0.6
1.6
—
0.3
40.3
Non-cash cost of land and improved
development
—
—
—
—
1.8
—
—
1.8
Adjusted EBITDA
$31.7
$17.6
$21.2
$1.0
$5.1
$0.2
($7.3
)
$69.5
(a)
Capital expenditures exclude timberland
acquisitions of $2.8 million and $29.9 million during the three
months ended March 31, 2022 and March 31, 2021, respectively.
(b)
Cash Available for Distribution (CAD) is
defined as cash provided by operating activities adjusted for
capital spending (excluding timberland acquisitions and real estate
development investments), CAD attributable to noncontrolling
interests in Timber Funds, and working capital and other balance
sheet changes. CAD is a non-GAAP measure of cash generated during a
period that is available for common stock dividends, distributions
to operating partnership unitholders, distributions to
noncontrolling interests, repurchase of the Company's common
shares, debt reduction, timberland acquisitions and real estate
development investments. CAD is not necessarily indicative of the
CAD that may be generated in future periods.
(c)
Adjusted EBITDA is defined as earnings
before interest, taxes, depreciation, depletion, amortization, the
non-cash cost of land and improved development, non-operating
income and expense, operating income attributable to noncontrolling
interests in Timber Funds, the gain on investment in Timber Funds
and Funds II Timberland 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 excludes specific
items that management believes are not indicative of the Company's
ongoing operating results.
(d)
Cash interest paid is presented net of
patronage refunds received of $5.5 million and $5.9 million during
the three months ended March 31, 2022 and March 31, 2021,
respectively, excluding patronage refunds attributable to
noncontrolling interests in Timber Funds.
(e)
Pro forma revenue (sales) is defined as
revenue (sales) adjusted for Fund II Timberland Dispositions and
sales attributable to the noncontrolling interests in Timber Funds.
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 Company's ongoing operating results.
(f)
“Fund II Timberland Dispositions”
represent the disposition of Fund II Timberland assets, which we
managed and owned a co-investment stake in. “Fund II Timberland
Dispositions attributable to Rayonier” represents the proportionate
share of Fund II Timberland Dispositions that are attributable to
Rayonier.
(g)
Pro forma net income is defined as net
income attributable to Rayonier Inc. adjusted for its proportionate
share of the gain on investment in Timber Funds and Fund II
Timberland 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 Company's ongoing operating
results.
(h)
“Gain on investment in Timber Funds”
reflects the gain recognized on Fund II carried interest incentive
fees in the fourth quarter of 2021.
(i)
“Pro Forma net income adjustments
attributable to noncontrolling interests in the operating
partnership” are the proportionate share of pro forma items that
are attributable to noncontrolling interests in the operating
partnership.
(j)
Pro forma operating income (loss) is
defined as operating income (loss) adjusted for operating income
attributable to noncontrolling interests in Timber Funds, the gain
on investment in Timber Funds and Fund II Timberland 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 Company's ongoing operating results.
F
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220503006394/en/
Investors/Media Collin Mings 904-357-9100
investorrelations@rayonier.com
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