- Third quarter net income attributable to Rayonier of $20.6
million ($0.14 per share) on revenues of $195.3 million
- Third quarter pro forma net income of $21.6 million ($0.15 per
share) on pro forma revenues of $195.3 million
- Third quarter operating income of $40.9 million, pro forma
operating income of $30.5 million, and Adjusted EBITDA of $64.7
million
- Year-to-date cash provided by operations of $209.9 million and
cash available for distribution (CAD) of $158.8 million
Rayonier Inc. (NYSE:RYN) today reported third quarter net income
attributable to Rayonier of $20.6 million, or $0.14 per share, on
revenues of $195.3 million. This compares to net income
attributable to Rayonier of $75.8 million, or $0.53 per share, on
revenues of $364.7 million in the prior year quarter.
The third quarter results included a $1.1 million timber
write-off resulting from a fire casualty event in Washington.1
Excluding this item, pro forma net income for the quarter was $21.6
million. The prior year third quarter results included $14.5
million of income from a Large Disposition,2 a $7.2 million gain on
Fund II Timberland Dispositions attributable to Rayonier,3 a $3.7
million gain on investment in Timber Funds,4 and a $0.9 million
gain on debt extinguishments.5 Excluding these items and pro forma
net income adjustments attributable to noncontrolling interests in
the operating partnership,6 pro forma net income7 was $50.3
million, or $0.35 per share, on pro forma revenues7 of $251.8
million in the prior year period.
The following table summarizes the current quarter and
comparable prior year period results:
Three Months Ended
(millions of dollars, except earnings per
share (EPS))
September 30, 2022
September 30, 2021
$
EPS
$
EPS
Revenues
$195.3
$364.7
Large Dispositions2
—
(20.0
)
Fund II Timberland Dispositions
attributable to Rayonier3
—
(17.5
)
Sales attributable to noncontrolling
interests in Timber Funds
—
(75.4
)
Pro forma revenues7
$195.3
$251.8
Net income attributable to Rayonier
$20.6
$0.14
$75.8
$0.53
Timber write-off resulting from a fire
casualty event1
1.1
0.01
—
—
Large Dispositions2
—
—
(14.5
)
(0.10
)
Fund II Timberland Dispositions
attributable to Rayonier3
—
—
(7.2
)
(0.05
)
Gain on investment in Timber Funds4
—
—
(3.7
)
(0.03
)
Gain related to debt extinguishments5
—
—
(0.9
)
—
Pro forma net income adjustments
attributable to noncontrolling interests in the operating
partnership6
—
—
0.8
—
Pro forma net income7
$21.6
$0.15
$50.3
$0.35
Third quarter operating income was $40.9 million versus $123.3
million in the prior year period. Third quarter operating income
included a $16.0 million gain on the sale of a multi-family
apartment complex in Bainbridge Island, Washington, which was held
in a joint venture acquired as part of our merger with Pope
Resources in 2020. This gain is reflected in our condensed
statement of consolidated income under the caption "Other operating
income, net." Pro forma operating income excludes $11.5 million of
this gain that was attributable to noncontrolling interests.
Adjusting for the $11.5 million gain attributable to noncontrolling
interests8 and the $1.1 million timber write-off resulting from a
casualty event,1 current quarter pro forma operating income7 was
$30.5 million. Prior year third quarter operating income included
$14.5 million of income from a Large Disposition,2 a $7.2 million
gain on Fund II Timberland Dispositions attributable to Rayonier,3
a $3.7 million gain on investment in Timber Funds,4 and $30.5
million of operating income attributable to noncontrolling
interests in the Timber Funds segment. Excluding these items, pro
forma operating income7 was $67.4 million in the prior year period.
Third quarter Adjusted EBITDA7 was $64.7 million versus $114.6
million in the prior year period.
The following table summarizes operating income, pro forma
operating income (loss),7 and Adjusted EBITDA7 for the current
quarter and comparable prior year period:
Three Months Ended September
30,
Operating Income
Pro forma Operating Income
(Loss)7
Adjusted EBITDA7
(millions of dollars)
2022
2021
2022
2021
2022
2021
Southern Timber
$22.5
$12.8
$22.5
$12.8
$36.6
$24.4
Pacific Northwest Timber
2.2
2.1
3.3
2.1
12.6
12.5
New Zealand Timber
9.3
13.3
9.3
13.3
15.6
19.9
Timber Funds
—
41.3
—
(0.2
)
—
0.5
Real Estate
15.7
60.6
4.3
46.1
8.4
63.8
Trading
0.2
—
0.2
—
0.2
—
Corporate and Other
(9.0
)
(6.7
)
(9.0
)
(6.7
)
(8.6
)
(6.4
)
Total
$40.9
$123.3
$30.5
$67.4
$64.7
$114.6
Year-to-date cash provided by operating activities was $209.9
million versus $277.4 million in the prior year period.
Year-to-date cash available for distribution (CAD)7 of $158.8
million decreased $45.0 million versus the prior year period,
primarily due to lower Adjusted EBITDA7 ($33.6 million), higher
cash taxes paid ($7.3 million), higher capital expenditures ($3.5
million), and higher cash interest paid ($0.6 million).
"We are encouraged by our third quarter results, particularly
given the challenges presented by ongoing cost pressures, the
recent slowdown in the U.S. housing market, and continued headwinds
in China as it relates to our export business," said David Nunes,
President and CEO. "While Adjusted EBITDA declined significantly
versus the prior year quarter, this was primarily due to
exceptionally strong Real Estate results in the prior year period.
Notably, total Adjusted EBITDA for our timber segments increased
14% versus the prior year period, as favorable results in our
Southern Timber segment more than offset lower Adjusted EBITDA in
our New Zealand Timber segment."
"Southern Timber Adjusted EBITDA improved 50% over the prior
year quarter, as strong demand and favorable geographic mix drove
18% higher net stumpage prices and drier weather conditions across
the region drove a 27% increase in harvest volumes. In Pacific
Northwest Timber, Adjusted EBITDA improved 1% over the prior year
quarter, as a 13% increase in weighted-average log prices more than
offset higher costs and an 11% reduction in harvest volumes.
Overall, we were pleased by our ability to maintain pricing gains
during the quarter and thus absorb higher costs across both
regions, as customer demand remained healthy."
"In New Zealand, the operating environment remained very
challenging throughout the third quarter. Our New Zealand Timber
segment Adjusted EBITDA declined 22% versus the prior year quarter,
primarily driven by an 18% decrease in weighted-average delivered
log prices due to COVID-related disruptions and a slowdown in
construction activity in China."
"Following a strong first half of the year, closing activity in
our Real Estate segment moderated in the third quarter as expected.
Real Estate segment Adjusted EBITDA was $55.4 million below the
prior year quarter, as the prior year period benefited from the
closing of two significant development transactions totaling $62.5
million in revenue. Despite the decline in Adjusted EBITDA, we were
encouraged by continued strong pricing for rural land in our
markets during the third quarter."
Southern Timber
Third quarter sales of $64.5 million increased $19.7 million, or
44%, versus the prior year period. Harvest volumes increased 27% to
1.50 million tons versus 1.19 million tons in the prior year
period, as more favorable weather conditions led to improved
production. Average pine sawtimber stumpage prices increased 19% to
$33.31 per ton versus $28.06 per ton in the prior year period, due
to continued strong demand from sawmills as well as competition
from pulp mills for chip-n-saw volume. Average pine pulpwood
stumpage prices rose 19% to $22.77 per ton versus $19.14 per ton in
the prior year period, driven by strong end-market demand and a
favorable geographic mix. Overall, weighted-average stumpage prices
(including hardwood) increased 18% to $25.80 per ton versus $21.88
per ton in the prior year period. Operating income of $22.5 million
increased $9.7 million versus the prior year period due to higher
net stumpage realizations ($5.8 million), higher volumes ($3.8
million), higher non-timber income ($1.3 million), and lower
depletion rates ($0.5 million), partially offset by higher overhead
and other costs ($1.7 million).
Third quarter Adjusted EBITDA7 of $36.6 million was 50%, or
$12.2 million, above the prior year period.
Pacific Northwest Timber
Third quarter sales of $34.4 million increased $2.9 million, or
9%, versus the prior year period, notwithstanding a decline in
harvest volumes of 11% to 307,000 tons versus 346,000 tons in the
prior year period. Average delivered sawtimber prices increased 10%
to $117.86 per ton versus $107.56 per ton in the prior year period,
driven by continued healthy demand from domestic lumber mills as
well as a favorable species mix, as a higher proportion of
Douglas-fir sawtimber was harvested in the current year quarter.
Average delivered pulpwood prices increased 62% to $50.74 per ton
versus $31.34 per ton in the prior year period, reflecting strong
end-market demand coupled with supply constraints due to fewer
residuals and increased competition for a limited supply of
smaller-sized logs. Operating income of $2.2 million improved $0.1
million versus the prior year period due to higher net stumpage
realizations ($1.9 million) and higher non-timber income ($0.5
million), partially offset by the write-off of timber basis due to
a fire in Washington ($1.1 million), lower volumes ($0.7 million),
and higher overhead and other costs ($0.5 million).
Third quarter Adjusted EBITDA7 of $12.6 million was 1%, or $0.1
million, above the prior year period.
New Zealand Timber
Third quarter sales of $72.5 million decreased $3.1 million, or
4%, versus the prior year period. Harvest volumes increased 7% to
712,000 tons versus 668,000 tons in the prior year period, due to
an increase in harvest activity following a relatively light start
to the year. Average delivered prices for export sawtimber
decreased 18% to $123.07 per ton versus $149.68 per ton in the
prior year period, driven by reduced demand from China due to
COVID-related disruptions as well as a slowdown in construction
activity. Average delivered prices for domestic sawtimber decreased
18% to $69.69 per ton versus $85.00 per ton in the prior year
period. The decrease in domestic sawtimber prices (in U.S. dollar
terms) was primarily driven by the decline in the NZ$/US$ exchange
rate (US$0.62 per NZ$1.00 versus US$0.70 per NZ$1.00). Excluding
the impact of foreign exchange rates, domestic sawtimber prices
decreased 8% versus the prior year period, reflecting additional
supply that was diverted into domestic markets due to export market
headwinds. Operating income of $9.3 million decreased $4.0 million
versus the prior year period due to lower net stumpage realizations
($11.2 million), higher costs ($0.3 million), and higher depletion
rates ($0.1 million), partially offset by higher carbon credit
sales ($6.0 million), higher volumes ($1.4 million), and favorable
foreign exchange impacts ($0.2 million).
Third quarter Adjusted EBITDA7 of $15.6 million was 22%, or $4.3
million, below the prior year period.
Real Estate
Third quarter sales of $12.4 million decreased $80.9 million
versus the prior year period, while operating income of $15.7
million decreased $44.9 million versus the prior year period. Third
quarter operating income included an $11.5 million gain
attributable to noncontrolling interests8 associated with the
Bainbridge Island multi-family apartment complex sale. Excluding
this item, pro forma operating income7 was $4.3 million. The prior
year third quarter sales and operating income included $20.0
million and $14.5 million, respectively, from a Large Disposition.2
Excluding this item, pro forma sales7 were $73.4 million and pro
forma operating income7 was $46.1 million in the prior year period.
Pro forma sales7 and pro forma operating income7 decreased versus
the prior year period due to a lower number of acres sold (1,828
acres sold versus 4,131 acres sold in the prior year period) and a
decrease in weighted-average prices ($5,064 per acre versus $17,490
per acre in the prior year period).
Improved Development sales of $2.3 million included $0.8 million
from the Wildlight development project north of Jacksonville,
Florida and $1.5 million from the Heartwood development project
south of Savannah, Georgia. Sales in Wildlight consisted of 13
residential lots ($65,000 per lot). Sales in Heartwood consisted of
a 15-acre commercial parcel to be used for a healthcare campus for
$1.0 million ($67,000 per acre) and 10 residential lots for $0.4
million ($44,000 per lot). This compares to prior year period
Improved Development sales of $27.8 million, which included a
significant sale in the Heartwood / Belfast Commerce Park.
There were no Unimproved Development sales in the third quarter.
This compares to prior year period sales of $37.5 million, which
consisted of a 359-acre sale in Kingston, Washington for $105,000
per acre.
Rural sales of $7.0 million consisted of 1,809 acres at an
average price of $3,848 per acre. This compares to prior year
period sales of $6.9 million, which consisted of 3,260 acres at an
average price of $2,128 per acre.
Third quarter Adjusted EBITDA7 of $8.4 million was $55.4 million
below the prior year period.
Trading
Third quarter sales of $11.6 million decreased $14.0 million
versus the prior year period, primarily due to lower volumes and
prices. Sales volumes decreased 46% to 95,000 tons versus 177,000
tons in the prior year period, reflecting constrained export market
demand. The Trading segment generated operating income of $0.2
million versus breakeven results in the prior year period.
Third quarter Adjusted EBITDA7 of $0.2 million was above
breakeven results in the prior year period.
Other Items
Third quarter corporate and other operating expenses of $9.0
million increased $2.2 million versus the prior year period,
primarily due to higher compensation and benefits expenses ($1.4
million) and higher legal and other overhead expenses ($0.8
million).
Third quarter interest expense of $9.1 million decreased $2.2
million versus the prior year period due to lower average
outstanding debt and a lower weighted-average interest rate as
compared to the prior year period.
Third quarter income tax expense of $1.2 million decreased $1.6
million versus the prior year period. The New Zealand subsidiary is
the primary driver of income tax expense.
Outlook
"Based on our year-to-date results and our expectations for the
fourth quarter, we are on track to achieve our prior full-year
Adjusted EBITDA guidance," added Nunes. "In our Southern Timber
segment, we expect full-year Adjusted EBITDA in line with our prior
guidance based on healthy demand trends and continued strong
pricing in our markets. In our Pacific Northwest Timber segment, we
expect full-year Adjusted EBITDA toward the higher end of our prior
guidance, as we expect continued strong pricing for both pulpwood
and sawtimber as compared to the prior year, albeit partially
offset by ongoing cost pressures. In our New Zealand Timber
segment, we expect full-year Adjusted EBITDA toward the lower end
of our prior guidance due to ongoing export market headwinds, as
demand from China remains constrained. In our Real Estate segment,
we expect full-year Adjusted EBITDA toward the lower end of our
prior guidance, as we now anticipate that a few transactions will
be deferred into early 2023 and that demand for certain rural
properties will likely moderate with the recent increase in
interest rates."
Conference Call
A conference call and live audio webcast will be held on
Thursday, November 3, 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 Saturday, December 3, 2022, by
dialing 866-568-3705 (domestic) or 203-369-3811 (international),
passcode: 11322.
Complimentary copies of Rayonier press releases and other
financial documents are also available by calling (904)
357-9100.
1"Timber write-off resulting from a
casualty event" includes the write-off of merchantable and
pre-merchantable timber volume destroyed by a casualty event that
cannot be salvaged.
2"Large Dispositions" are defined as
transactions involving the sale of timberland that exceed $20
million in size and do not have a demonstrable premium relative to
timberland value.
3"Fund II Timberland Dispositions
attributable to Rayonier" represent the proportionate share of Fund
II Timberland Dispositions that are attributable to Rayonier.
4"Gain on investment in Timber Funds"
represents the gain recognized on the sale of rights to manage two
Timber funds (Funds III and IV) previously managed by the Company’s
Olympic Resources Management (ORM) subsidiary, as well as its
co-investment stake in both funds.
5"Gain related to debt extinguishments"
includes prepayment penalties and the write-off of fair market
value adjustments and unamortized capitalized loan costs.
6"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.
7"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.
8"Gain associated with the multi-family
apartment complex sale attributable to noncontrolling interests"
represents the gain recognized in connection with the sale of
property by the Bainbridge Landing joint venture attributable to
noncontrolling interests.
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, 2022, Rayonier owned or leased under long-term
agreements approximately 2.7 million acres of timberlands located
in the U.S. South (1.79 million acres), U.S. Pacific Northwest
(486,000 acres) and New Zealand (417,000 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
September 30, 2022
(unaudited)
(millions of dollars, except per
share information)
Three Months Ended
Nine Months Ended
September 30,
June 30,
September 30,
September 30,
September 30,
2022
2022
2021
2022
2021
SALES
$195.3
$246.3
$364.7
$663.7
$847.6
Costs and Expenses
Cost of sales
(152.1
)
(194.3
)
(233.3
)
(507.4
)
(579.0
)
Selling and general expenses
(16.9
)
(17.3
)
(13.2
)
(49.0
)
(41.9
)
Other operating income, net
14.6
0.8
5.1
14.4
9.5
OPERATING INCOME
40.9
35.5
123.3
121.7
236.2
Interest expense
(9.1
)
(9.1
)
(11.3
)
(26.5
)
(34.3
)
Interest and other miscellaneous income,
net
1.3
0.2
1.3
1.0
0.2
INCOME BEFORE INCOME TAXES
33.1
26.6
113.3
96.2
202.1
Income tax expense
(1.2
)
(1.3
)
(2.8
)
(8.1
)
(13.1
)
NET INCOME
31.9
25.3
110.5
88.1
189.0
Less: Net income attributable to
noncontrolling interests in the operating partnership
(0.5
)
(0.6
)
(2.2
)
(1.7
)
(4.3
)
Less: Net income attributable to
noncontrolling interests in consolidated affiliates
(10.8
)
(0.6
)
(32.5
)
(12.4
)
(40.8
)
NET INCOME ATTRIBUTABLE TO RAYONIER
INC.
$20.6
$24.1
$75.8
$74.0
$143.9
EARNINGS PER COMMON SHARE
Basic earnings per share attributable to
Rayonier Inc.
$0.14
$0.16
$0.53
$0.51
$1.03
Diluted earnings per share attributable to
Rayonier Inc.
$0.14
$0.16
$0.53
$0.50
$1.03
Pro forma net income per share (a)
$0.15
$0.16
$0.35
$0.51
$0.66
Weighted Average Common Shares used for
determining
Basic EPS
146,370,340
146,257,311
141,777,574
146,022,718
139,749,358
Diluted EPS (b)
150,232,889
150,244,379
146,439,568
150,011,281
144,365,110
(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 September 30, 2022, there were 146,422,825
common shares and 3,211,327 Redeemable Operating Partnership Units
outstanding.
A
RAYONIER INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
September 30, 2022
(unaudited)
(millions of dollars)
September 30,
December 31,
2022
2021
Assets
Cash and cash equivalents (excluding
Timber Funds)
$260.9
$358.7
Cash and cash equivalents (Timber
Funds)
0.9
3.5
Restricted cash (Timber Funds)
1.5
6.3
Assets held for sale
2.4
5.1
Other current assets
89.4
77.9
Timber and timberlands, net of depletion
and amortization
2,750.5
2,895.0
Higher and better use timberlands and real
estate development investments
116.0
106.9
Property, plant and equipment
44.5
44.5
Less - accumulated depreciation
(16.7
)
(14.9
)
Net property, plant and equipment
27.8
29.6
Restricted cash (excluding Timber
Funds)
16.3
0.6
Right-of-use assets
95.7
101.8
Other assets
111.0
51.0
$3,472.4
$3,636.4
Liabilities, Noncontrolling Interests
in the Operating Partnership and Shareholders’ Equity
Current maturities of long-term debt
—
125.0
Distribution payable (Timber Funds)
1.6
6.3
Other current liabilities
110.8
100.4
Long-term debt
1,257.8
1,242.8
Long-term lease liability
87.6
93.4
Other non-current liabilities
93.7
119.1
Noncontrolling interests in the operating
partnership
96.2
133.8
Total Rayonier Inc. shareholders’
equity
1,813.4
1,771.8
Noncontrolling interests in consolidated
affiliates
11.3
43.8
Total shareholders’ equity
1,824.7
1,815.6
$3,472.4
$3,636.4
B
RAYONIER INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
September 30, 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
Net income
—
—
24.7
—
0.6
25.3
Net income attributable to noncontrolling
interests in the operating partnership
—
—
(0.6
)
—
—
(0.6
)
Dividends ($0.285 per share)
—
—
(42.1
)
—
—
(42.1
)
Issuance of shares under incentive stock
plans
304,887
2.0
—
—
—
2.0
Stock-based compensation
—
4.4
—
—
—
4.4
Adjustment of noncontrolling interests in
the operating partnership
—
—
11.4
—
—
11.4
Other (a)
(90,843
)
(4.0
)
—
(25.4
)
(32.2
)
(61.6
)
Balance, June 30, 2022
146,321,732
$1,424.3
$382.5
$0.6
$13.0
$1,820.4
Net income
—
—
21.1
—
10.8
31.9
Net income attributable to noncontrolling
interests in the operating partnership
—
—
(0.5
)
—
—
(0.5
)
Dividends ($0.285 per share)
—
—
(42.1
)
—
—
(42.1
)
Issuance of shares under incentive stock
plans
760
—
—
—
—
—
Stock-based compensation
—
2.6
—
—
—
2.6
Adjustment of noncontrolling interests in
the operating partnership
—
—
23.4
—
—
23.4
Other (a)
100,333
3.7
—
(2.2
)
(12.5
)
(11.0
)
Balance, September 30, 2022
146,422,825
$1,430.6
$384.4
($1.6
)
$11.3
$1,824.7
Common Shares
Retained Earnings
Accumulated
Other
Comprehensive Loss
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
Issuance of shares under the
"at-the-market" (ATM) equity offering program, net of commissions
and offering costs of $0.9 million
2,199,459
80.0
—
—
—
80.0
Net income
—
—
58.9
—
4.5
63.4
Net income attributable to noncontrolling
interests in the operating partnership
—
—
(1.7
)
—
—
(1.7
)
Dividends ($0.27 per share)
—
—
(38.0
)
—
—
(38.0
)
Issuance of shares under incentive stock
plans
185,544
3.3
—
—
—
3.3
Stock-based compensation
—
2.9
—
—
—
2.9
Measurement period adjustment of
noncontrolling
interests in consolidated affiliates
—
—
—
—
9.0
9.0
Adjustment of noncontrolling interests in
the operating partnership
—
—
(15.4
)
—
—
(15.4
)
Other (a)
(35,986
)
(1.1
)
—
(8.3
)
(6.5
)
(15.9
)
Balance, June 30, 2021
141,319,907
$1,231.3
$411.5
($33.4
)
$388.1
$1,997.5
Issuance of shares under the
"at-the-market" (ATM) equity offering program, net of commissions
and offering costs of $0.7 million
1,390,968
51.1
—
—
—
51.1
Net income
—
—
78.0
—
32.5
110.5
Net income attributable to noncontrolling
interests in the operating partnership
—
—
(2.2
)
—
—
(2.2
)
Dividends ($0.27 per share)
—
—
(38.9
)
—
—
(38.9
)
Issuance of shares under incentive stock
plans
5,740
0.2
—
—
—
0.2
Stock-based compensation
—
2.1
—
—
—
2.1
Disposition of noncontrolling interests in
consolidated affiliates
—
—
—
—
(255.5
)
(255.5
)
Adjustment of noncontrolling interests in
the operating partnership
—
—
1.7
—
—
1.7
Other (a)
332,843
12.2
—
(3.2
)
(83.0
)
(74.0
)
Balance, September 30, 2021
143,049,458
$1,296.9
$450.1
($36.6
)
$82.1
$1,792.5
(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 nine
months ended September 30, 2022 also includes the redemption of
104,414 Redeemable Operating Partnership Units, respectively, for
an equal number of Rayonier Inc. common shares, common stock
offering costs associated with the “at-the-market” (ATM) equity
offering program, as well as changes related to the
recapitalization of the New Zealand JV.
C
RAYONIER INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
September 30, 2022
(unaudited)
(millions of dollars)
Nine Months Ended September
30,
2022
2021
Cash provided by operating
activities:
Net income
$88.1
$189.0
Depreciation, depletion and
amortization
114.2
121.2
Non-cash cost of land and improved
development
20.3
22.8
Gain on large dispositions of
timberlands
—
(44.8
)
Gain on sale of Timber Funds III &
IV
—
(3.7
)
Gain on Fund II timberland
dispositions
—
(36.0
)
Stock-based incentive compensation
expense
9.8
7.1
Deferred income taxes
(6.7
)
7.6
Other items to reconcile net income to
cash provided by operating activities
(1.1
)
13.0
Changes in working capital and other
assets and liabilities
(14.7
)
1.2
209.9
277.4
Cash (used for) provided by investing
activities:
Capital expenditures
(48.2
)
(47.5
)
Real estate development investments
(10.9
)
(9.2
)
Purchase of timberlands
(3.2
)
(51.9
)
Net proceeds from large dispositions of
timberlands
—
54.7
Net proceeds from sale of Timber Funds III
& IV
—
31.1
Net proceeds from Fund II timberland
dispositions
—
85.2
Other
6.4
6.9
(55.9
)
69.3
Cash (used for) provided by financing
activities:
Net (decrease) increase in debt
(125.0
)
26.4
Dividends paid
(123.6
)
(114.3
)
Distributions to noncontrolling interests
in the operating partnership
(2.8
)
(3.4
)
Proceeds from the issuance of common
shares under incentive stock plan
2.6
4.7
Proceeds from the issuance of common
shares under the "at-the-market" (ATM) equity offering program, net
of commissions and offering costs
31.9
166.5
Distributions to noncontrolling interests
in consolidated affiliates
(16.5
)
(19.6
)
Make-whole fee on NWFCS debt
prepayment
—
(6.2
)
Other
(4.2
)
(6.4
)
(237.6
)
47.7
Effect of exchange rate changes on cash
and restricted cash
(6.0
)
(0.3
)
Cash, cash equivalents and restricted
cash:
Change in cash, cash equivalents and
restricted cash
(89.6
)
394.1
Balance, beginning of year
369.1
87.5
Balance, end of period
$279.5
$481.6
D
RAYONIER INC. AND
SUBSIDIARIES
BUSINESS SEGMENT SALES, PRO
FORMA SALES, OPERATING INCOME,
PRO FORMA OPERATING INCOME AND
ADJUSTED EBITDA
September 30, 2022
(unaudited)
(millions of dollars)
Three Months Ended
Nine Months Ended
September 30,
June 30,
September 30,
September 30,
September 30,
2022
2022
2021
2022
2021
Sales
Southern Timber
$64.5
$66.3
$44.8
$207.6
$145.8
Pacific Northwest Timber
34.4
39.2
31.5
119.8
108.4
New Zealand Timber
72.5
78.9
75.6
202.7
213.7
Timber Funds
—
—
94.5
—
128.1
Real Estate
12.4
34.4
93.4
81.0
178.4
Trading
11.6
27.7
25.6
52.7
76.8
Intersegment Eliminations
(0.1
)
(0.1
)
(0.7
)
(0.2
)
(3.6
)
Sales
$195.3
$246.3
$364.7
$663.7
$847.6
Pro forma sales (a)
Southern Timber
$64.5
$66.3
$44.8
$207.6
$145.8
Pacific Northwest Timber
34.4
39.2
31.5
119.8
108.4
New Zealand Timber
72.5
78.9
75.6
202.7
213.7
Timber Funds
—
—
1.6
—
8.5
Real Estate
12.4
34.4
73.4
81.0
122.4
Trading
11.6
27.7
25.6
52.7
76.8
Intersegment Eliminations
(0.1
)
(0.1
)
(0.7
)
(0.2
)
(3.6
)
Pro forma sales
$195.3
$246.3
$251.8
$663.7
$672.0
Operating income (loss)
Southern Timber
$22.5
$24.1
$12.8
$76.9
$47.1
Pacific Northwest Timber
2.2
2.9
2.1
11.7
5.3
New Zealand Timber
9.3
8.0
13.3
22.7
48.0
Timber Funds
—
—
41.3
—
44.8
Real Estate
15.7
11.0
60.6
37.0
112.8
Trading
0.2
(0.4
)
—
0.1
0.6
Corporate and Other
(9.0
)
(10.1
)
(6.7
)
(26.6
)
(22.3
)
Operating income
$40.9
$35.5
$123.3
$121.7
$236.2
Pro forma operating income (loss)
(a)
Southern Timber
$22.5
$24.1
$12.8
$76.9
$47.1
Pacific Northwest Timber
3.3
2.9
2.1
12.8
5.3
New Zealand Timber
9.3
8.0
13.3
22.7
48.0
Timber Funds
—
—
(0.2
)
—
0.6
Real Estate
4.3
11.0
46.1
25.5
68.0
Trading
0.2
(0.4
)
—
0.1
0.6
Corporate and Other
(9.0
)
(10.1
)
(6.7
)
(26.6
)
(22.3
)
Pro forma operating income
$30.5
$35.5
$67.4
$111.3
$147.3
Adjusted EBITDA (a)
Southern Timber
$36.6
$38.7
$24.4
$123.7
$86.6
Pacific Northwest Timber
12.6
14.3
12.5
48.4
44.1
New Zealand Timber
15.6
14.9
19.9
40.8
68.7
Timber Funds
—
—
0.5
—
2.8
Real Estate
8.4
25.4
63.8
58.4
97.9
Trading
0.2
(0.4
)
—
0.1
0.6
Corporate and Other
(8.6
)
(9.8
)
(6.4
)
(25.7
)
(21.4
)
Adjusted EBITDA
$64.7
$83.0
$114.6
$245.8
$279.4
(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
September 30, 2022
(unaudited)
(millions of dollars, except per
share information)
LIQUIDITY MEASURES:
Nine Months Ended
September 30,
September 30,
2022
2021
Cash Provided by Operating
Activities
$209.9
$277.4
Working capital and other balance sheet
changes
(2.9
)
(13.5
)
Cash Available for Distribution
attributable to NCI in Timber Funds
—
(12.5
)
Capital expenditures (a)
(48.2
)
(47.5
)
Cash Available for Distribution
(b)
$158.8
$203.9
Net Income
$88.1
$189.0
Operating income attributable to NCI in
Timber Funds
—
(33.3
)
Interest, net attributable to NCI in
Timber Funds
—
0.3
Net Income (Excluding NCI in Timber
Funds)
$88.1
$156.0
Interest, net and miscellaneous income
attributable to Rayonier
25.0
33.8
Income tax expense attributable to
Rayonier
8.1
13.1
Depreciation, depletion and amortization
attributable to Rayonier
114.2
109.3
Non-cash cost of land and improved
development
20.3
22.8
Timber write-offs resulting from casualty
event attributable to Rayonier (c)
1.1
—
Non-operating expense
0.5
—
Gain associated with the multi-family
apartment complex sale attributable to NCI (d)
(11.5
)
—
Gain on investment in Timber Funds (e)
—
(3.7
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
(7.2
)
Large Dispositions (g)
—
(44.8
)
Adjusted EBITDA (h)
$245.8
$279.4
Cash interest paid attributable to
Rayonier (i)
(24.2
)
(23.5
)
Cash taxes paid attributable to
Rayonier
(14.6
)
(7.3
)
Capital expenditures attributable to
Rayonier (a)
(48.2
)
(44.7
)
Cash Available for Distribution
(b)
$158.8
$203.9
Cash Available for Distribution
(b)
$158.8
$203.9
Real estate development investments
(10.9
)
(9.2
)
Cash Available for Distribution after
real estate development investments
$147.9
$194.7
PRO FORMA SALES (j):
Three Months Ended
Southern Timber
Pacific Northwest
Timber
New Zealand Timber
Timber Funds
Real Estate
Trading
Intersegment
Eliminations
Total
September 30, 2022
Sales
$64.5
$34.4
$72.5
—
$12.4
$11.6
($0.1
)
$195.3
Pro forma sales
$64.5
$34.4
$72.5
—
$12.4
$11.6
($0.1
)
$195.3
June 30, 2022
Sales
$66.3
$39.2
$78.9
—
$34.4
$27.7
($0.1
)
$246.3
Pro forma sales
$66.3
$39.2
$78.9
—
$34.4
$27.7
($0.1
)
$246.3
September 30, 2021
Sales
$44.8
$31.5
$75.6
$94.5
$93.4
$25.6
($0.7
)
$364.7
Sales attributable to noncontrolling
interests in Timber Funds
—
—
—
(75.4
)
—
—
—
(75.4
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
(17.5
)
—
—
—
(17.5
)
Large Dispositions (g)
—
—
—
—
(20.0
)
—
—
(20.0
)
Pro forma sales
$44.8
$31.5
$75.6
$1.6
$73.4
$25.6
($0.7
)
$251.8
PRO FORMA SALES (j):
Nine Months Ended
Southern Timber
Pacific Northwest
Timber
New Zealand Timber
Timber Funds
Real Estate
Trading
Intersegment
Eliminations
Total
September 30, 2022
Sales
$207.6
$119.8
$202.7
—
$81.0
$52.7
($0.2
)
$663.7
Pro forma sales
$207.6
$119.8
$202.7
—
$81.0
$52.7
($0.2
)
$663.7
September 30, 2021
Sales
$145.8
$108.4
$213.7
$128.1
$178.4
$76.8
($3.6
)
$847.6
Sales attributable to noncontrolling
interests in Timber Funds
—
—
—
(102.1
)
—
—
—
(102.1
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
(17.5
)
—
—
—
(17.5
)
Large Disposition (g)
—
—
—
—
(56.0
)
—
—
(56.0
)
Pro forma sales
$145.8
$108.4
$213.7
$8.5
$122.4
$76.8
($3.6
)
$672.0
PRO FORMA NET INCOME (k):
Three Months Ended
Nine Months Ended
September 30, 2022
June 30, 2022
September 30, 2021
September 30, 2022
September 30, 2021
$
Per Diluted Share
$
Per Diluted Share
$
Per Diluted Share
$
Per Diluted Share
$
Per Diluted Share
Net Income Attributable to Rayonier
Inc.
$20.6
$0.14
$24.1
$0.16
$75.8
$0.53
$74.0
$0.50
$143.9
$1.03
Gain on investment in Timber Funds (e)
—
—
—
—
(3.7
)
(0.03
)
—
—
(3.7
)
(0.03
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
—
(7.2
)
(0.05
)
—
—
(7.2
)
(0.05
)
Loss from terminated cash flow hedge
(l)
—
—
—
—
—
—
—
—
2.2
0.02
(Gain) Loss related to debt
extinguishments and modifications (m)
—
—
—
—
(0.9
)
—
—
—
0.2
—
Timber write-offs resulting from casualty
event (c)
1.1
0.01
—
—
—
—
1.1
0.01
—
—
Large Dispositions (g)
—
—
—
—
(14.5
)
(0.10
)
—
—
(44.8
)
(0.31
)
Pro forma net income adjustments
attributable to noncontrolling interests in the operating
partnership (n)
—
—
—
—
0.8
—
—
—
1.5
—
Pro Forma Net Income
$21.6
$0.15
$24.1
$0.16
$50.3
$0.35
$75.1
$0.51
$92.1
$0.66
PRO FORMA OPERATING INCOME (LOSS) AND
ADJUSTED EBITDA (o) (h):
Three Months Ended
Southern Timber
Pacific Northwest
Timber
New Zealand Timber
Timber Funds
Real Estate
Trading
Corporate
and
Other
Total
September 30, 2022
Operating income
$22.5
$2.2
$9.3
—
$15.7
$0.2
($9.0
)
$40.9
Gain associated with the multi-family
apartment complex sale attributable to NCI (d)
—
—
—
—
(11.5
)
—
—
(11.5
)
Timber write-offs resulting from casualty
event (c)
—
1.1
—
—
—
—
—
1.1
Pro forma operating income
$22.5
$3.3
$9.3
—
$4.3
$0.2
($9.0
)
$30.5
Depreciation, depletion and
amortization
14.1
9.4
6.3
—
1.0
—
0.3
31.1
Non-cash cost of land and improved
development
—
—
—
—
3.1
—
—
3.1
Adjusted EBITDA
$36.6
$12.6
$15.6
—
$8.4
$0.2
($8.6
)
$64.7
June 30, 2022
Operating income (loss)
$24.1
$2.9
$8.0
—
$11.0
($0.4
)
($10.1
)
$35.5
Depreciation, depletion and
amortization
14.7
11.3
6.9
—
2.6
—
0.3
35.8
Non-cash cost of land and improved
development
—
—
—
—
11.8
—
—
11.8
Adjusted EBITDA
$38.7
$14.3
$14.9
—
$25.4
($0.4
)
($9.8
)
$83.0
September 30, 2021
Operating income
$12.8
$2.1
$13.3
$41.3
$60.6
—
($6.7
)
$123.3
Gain on investment in Timber Funds (e)
—
—
—
(3.7
)
—
—
—
(3.7
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
(7.2
)
—
—
—
(7.2
)
Operating income attributable to NCI in
Timber Funds
—
—
—
(30.5
)
—
—
—
(30.5
)
Large Dispositions (g)
—
—
—
—
(14.5
)
—
—
(14.5
)
Pro forma operating income (loss)
$12.8
$2.1
$13.3
($0.2
)
$46.1
—
($6.7
)
$67.4
Depreciation, depletion and
amortization
11.6
10.5
6.6
0.7
1.8
—
0.3
31.5
Non-cash cost of land and improved
development
—
—
—
—
15.8
—
—
15.8
Adjusted EBITDA
$24.4
$12.5
$19.9
$0.5
$63.8
—
($6.4
)
$114.6
PRO FORMA OPERATING INCOME AND ADJUSTED
EBITDA (o) (h):
Nine Months Ended
Southern Timber
Pacific Northwest
Timber
New Zealand Timber
Timber Funds
Real Estate
Trading
Corporate
and
Other
Total
September 30, 2022
Operating income
$76.9
$11.7
$22.7
—
$37.0
$0.1
($26.6
)
$121.7
Gain associated with the multi-family
apartment complex sale attributable to NCI (d)
—
—
—
—
(11.5
)
—
—
(11.5
)
Timber write-offs resulting from casualty
event (c)
—
1.1
—
—
—
—
—
1.1
Pro forma operating income
$76.9
$12.8
$22.7
—
$25.5
$0.1
($26.6
)
$111.3
Depreciation, depletion and
amortization
46.8
35.6
18.2
—
12.7
—
0.9
114.2
Non-cash cost of land and improved
development
—
—
—
—
20.3
—
—
20.3
Adjusted EBITDA
$123.7
$48.4
$40.8
—
$58.4
$0.1
($25.7
)
$245.8
September 30, 2021
Operating income
$47.1
$5.3
$48.0
$44.8
$112.8
$0.6
($22.3
)
$236.2
Gain on investment in Timber Funds (e)
—
—
—
(3.7
)
—
—
—
(3.7
)
Fund II Timberland Dispositions
attributable to Rayonier (f)
—
—
—
(7.2
)
—
—
—
(7.2
)
Operating income attributable to NCI in
Timber Funds
—
—
—
(33.3
)
—
—
—
(33.3
)
Large Dispositions (g)
—
—
—
—
(44.8
)
—
—
(44.8
)
Pro forma operating income
$47.1
$5.3
$48.0
$0.6
$68.0
$0.6
($22.3
)
$147.3
Depreciation, depletion and
amortization
39.5
38.8
20.8
2.2
7.1
—
0.9
109.3
Non-cash cost of land and improved
development
—
—
—
—
22.8
—
—
22.8
Adjusted EBITDA
$86.6
$44.1
$68.7
$2.8
$97.9
$0.6
($21.4
)
$279.4
(a)
Capital expenditures exclude timberland acquisitions of $3.2
million and $51.9 million during the nine months ended September
30, 2022 and September 30, 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)
“Timber write-off resulting from a
casualty event” includes the write-off of merchantable and
pre-merchantable timber volume destroyed by casualty events which
cannot be salvaged.
(d)
“Gain associated with the multi-family
apartment complex sale attributable to noncontrolling interests”
represents the gain recognized in connection with the sale of
property by the Bainbridge Landing joint venture attributable to
noncontrolling interests.
(e)
“Gain on investment in Timber Funds”
represents the gain recognized on the sale of rights to manage two
timber funds (Funds III and IV) previously managed by the Company’s
Olympic Resources Management (ORM) subsidiary, as well as its
co-investment stake in both funds.
(f)
“Fund II Timberland Dispositions”
represent the disposition of Fund II Timberland assets, which we
managed and owned a co-investment stake in.
(g)
“Large Dispositions” are defined as
transactions involving the sale of timberland that exceed $20
million in size and do not have a demonstrable premium relative to
timberland value.
(h)
“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 (loss) attributable to
noncontrolling interests in Timber Funds, gain associated with
apartment complex sale attributable to noncontrolling interests,
the gain on investment in timber funds, Fund II timberland
dispositions, timber write-offs resulting from casualty events 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 excludes specific items that
management believes are not indicative of the Company’s ongoing
operating results.
(i)
Cash interest paid is presented net of
patronage refunds received of $6.0 million and $6.5 million during
the nine months ended September 30, 2022 and September 30, 2021,
respectively, excluding patronage refunds attributable to
noncontrolling interests in Timber Funds.
(j)
“Pro forma revenue (sales)” is defined as
revenue (sales) adjusted for Large Dispositions, Fund II timberland
dispositions and sales attributable to 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.
(k)
“Pro forma net income” is defined as net
income attributable to Rayonier Inc. adjusted for its proportionate
share of losses from a terminated cash flow hedge, gains (losses)
related to debt extinguishments and modifications, gain on
investment in Timber Funds, Fund II timberland dispositions, timber
write-offs resulting from casualty events 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 Company’s ongoing operating results.
(l)
“Loss from terminated cash flow hedge” is
the mark to market loss recognized in earnings due to the early
termination of an interest rate swap, as the hedged cash flows will
no longer occur.
(m)
“Gain related to debt extinguishments and
modifications” includes prepayment penalties and unamortized
capitalized loan costs associated with repaid debt in addition to
legal and arrangement fees associated with refinancing, partially
offset by the write-off of fair market value adjustments.
(n)
“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.
(o)
“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 joint venture investment attributable to noncontrolling
interests, the gain on investment in Timber Funds, Fund II
timberland dispositions, timber write-offs resulting from casualty
events 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 Company’s ongoing operating
results.
F
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221101006361/en/
Investors/Media Collin Mings 904-357-9100
investorrelations@rayonier.com
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