Weyerhaeuser Reports Second Quarter Results

- Net earnings before special items increased fourfold compared with second quarter 2012

- Net sales increased approximately 20 percent to $2.1 billion, highest since 2008

- Acquired approximately 645,000 acres of unique, high-value timberlands in Washington and Oregon through purchase of Longview Timber LLC

26 Jul, 2013, 03:05 ET from Weyerhaeuser Company

FEDERAL WAY, Wash., July 26, 2013 /PRNewswire/ -- Weyerhaeuser Company (NYSE: WY) today reported net earnings to common shareholders of $196 million, or 35 cents per diluted share, for the second quarter. As there were no special items this period, this compares with net earnings before special items of $47 million, or 9 cents per diluted share, for the same period last year. Net sales for the second quarter of 2013 totaled $2.1 billion, compared with net sales of $1.8 billion for the second quarter of 2012.

(Logo: http://photos.prnewswire.com/prnh/20120111/AQ34535LOGO)

"This was a milestone quarter for Weyerhaeuser," said Dan Fulton, president and chief executive officer. "We moved forward both strategically and operationally with the acquisition of Longview Timber LLC and by delivering strong operating results in this improving housing market."

WEYERHAEUSER FINANCIAL HIGHLIGHTS

2013

2013

2012

(millions, except per share data)

1Q

2Q

2Q

Net sales

$1,951

$2,141

$1,793

Net earnings attributable to Weyerhaeuser common shareholders

$144

$196

$84

Weighted average shares outstanding, diluted(1)

551

558

540

Earnings per diluted share

$0.26

$0.35

$0.16

Net earnings before special items

$144

$196

$47

Earnings per diluted share before special items

$0.26

$0.35

$0.09

Net cash from operations

($61)

$374

$267

Net change in cash and cash equivalents(2,3)

($259)

$1,723

$133

Cash and cash equivalents at end of period(2,3)

$639

$2,362

$861

(1) Weyerhaeuser's common shares outstanding increased to approximately 578 million basic shares, or 583 million shares on a diluted basis, during the second quarter of 2013 following the issuance of 29 million common shares in conjunction with the acquisition of Longview Timber LLC. The company also issued 13.8 million mandatory convertible preference shares with a conversion date of July 1, 2016. Subsequent to the end of the second quarter, the company issued an additional 4.35 million common shares in connection with the exercise of an overallotment option.

(2) During the second quarter of 2013, Weyerhaeuser received $1,450 million from issuance of common and mandatory convertible preference shares related to the acquisition of Longview Timber LLC. These funds are recorded as "Cash and cash equivalents designated for purchase of Longview Timber LLC" on the Consolidated Balance Sheet.

(3) First quarter includes $156 million for debt repayment.

TIMBERLANDS

FINANCIAL HIGHLIGHTS (millions)

1Q 2013

2Q 2013

Change

Net sales to unaffiliated customers

$293

$333

$40

Intersegment sales

224

166

(58)

Total net sales

$517

$499

($18)

Contribution to earnings

$104

$114

$10

2Q 2013 Performance - Earnings from disposition of non-strategic timberlands increased $11 million compared with the first quarter. In the West, improved selling prices for export and domestic logs were mostly offset by slightly lower fee harvest volumes, increased logging costs, and seasonally higher road and silviculture expenses. Southern fee harvest volumes and log realizations were comparable to the first quarter.

3Q 2013 Outlook - On July 23, 2013, Weyerhaeuser completed the acquisition of Longview Timber LLC. Earnings from these operations will be included in the Timberlands segment beginning in the third quarter of 2013.

Weyerhaeuser anticipates lower earnings from the Timberlands segment in the third quarter, as the positive contribution from a partial quarter of Longview Timber earnings will not offset a normal seasonal decline in the contribution from the company's existing operations. The company expects seasonally higher road and silviculture costs, weaker domestic and export prices for Western logs, and a seasonal reduction in fee harvest from existing Western operations. These should be partially offset by seasonally higher Southern harvest volumes and somewhat higher earnings from disposition of non-strategic timberlands.

WOOD PRODUCTS

FINANCIAL HIGHLIGHTS (millions)

1Q 2013

2Q 2013

Change

Net sales to unaffiliated customers

$988

$1,065

$77

Intersegment sales

18

18

0

Total net sales

$1,006

$1,083

$77

Contribution to earnings

$178

$136

($42)

2Q 2013 Performance - Lumber sales volumes improved 13 percent compared with the first quarter, and sales volumes for most other products improved slightly. These improvements were more than offset by lower average selling prices for oriented strand board and higher raw material costs. Manufacturing costs increased due to higher maintenance expense and unplanned downtime in oriented strand board and engineered wood products mills. Distribution business margins declined due to falling prices for commodity products throughout most of the second quarter.

3Q 2013 Outlook - Weyerhaeuser anticipates lower earnings from the Wood Products segment in the third quarter. The company expects substantially lower average selling prices for oriented strand board and lower lumber realizations. These should be partially offset by improved sales volumes across most product lines, lower log and maintenance costs, and improved operating rates.

CELLULOSE FIBERS

FINANCIAL HIGHLIGHTS (millions)

1Q 2013

2Q 2013

Change

Net sales

$474

$476

$2

Contribution to earnings

$31

$57

$26

2Q 2013 Performance - Maintenance costs declined and pulp mill productivity increased due to a reduction in major maintenance projects. Energy, fiber, and chemical costs declined and average pulp price realizations improved slightly.

3Q 2013 Outlook - Weyerhaeuser expects comparable earnings from the Cellulose Fibers segment in the third quarter. The company anticipates slightly higher average selling prices due to mix, slightly improved sales volumes and lower fiber and energy costs, offset by increased maintenance expense.

REAL ESTATE

FINANCIAL HIGHLIGHTS (millions)

1Q 2013

2Q 2013

Change

Net sales

$196

$267

$71

Contribution to earnings

$0

$14

$14

2Q 2013 Performance - Home closings increased seasonally to 636 single-family homes, and average margins on homes closed improved due to mix. These factors were partially offset by increased selling costs due to the higher closing volume. Second quarter results include earnings of $2 million from land and lot sales.

At the end of the second quarter the backlog of homes sold, but not closed, totaled 1,438 units, compared with 1,033 units one year ago.

3Q 2013 Outlook - Weyerhaeuser expects slightly higher earnings from single-family homebuilding in the third quarter. Single-family closing volume should increase seasonally to more than 700 single-family homes, with lower average margins due to mix. The company anticipates higher selling-related expenses due to the additional closing volume, and somewhat higher earnings from land and lot sales.

ABOUT WEYERHAEUSER Weyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control nearly 7 million acres of timberlands, primarily in the U.S., and manage another 14 million acres under long-term licenses in Canada. We manage these timberlands on a sustainable basis in compliance with internationally recognized forestry standards. We are also one of the largest manufacturers of wood and cellulose fibers products, and we develop real estate, primarily as a builder of single-family homes. Our company is a real estate investment trust. In 2012, we generated $7.1 billion in sales and employed approximately 13,200 people who serve customers worldwide. We are listed on the Dow Jones World Sustainability Index. Our common stock trades on the New York Stock Exchange under the symbol WY.

EARNINGS CALL INFORMATION Weyerhaeuser will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on July 26 to discuss second quarter results.

To access the live webcast and presentation online, go to the Investor Relations section on www.weyerhaeuser.com on July 26.

To join the conference call from within North America, dial 877-296-9413 (access code – 86488658) at least 15 minutes prior to the call. Those calling from outside North America should dial 706-679-2458 (access code – 86488658). Replays will be available for two weeks at 855-859-2056 (access code – 86488658) from within North America and at 404-537-3406 (access code – 86488658) from outside North America.

FORWARD LOOKING STATEMENTS This news release contains statements concerning the company's future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on various assumptions and may not be accurate because of risks and uncertainties surrounding these assumptions. Factors listed below, as well as other factors, may cause actual results to differ significantly from these forward-looking statements. There is no guarantee that any of the events anticipated by these forward-looking statements will occur. If any of the events occur, there is no guarantee what effect they will have on company operations or financial condition. The company will not update these forward-looking statements after the date of this news release.

Some forward-looking statements discuss the company's plans, strategies and intentions. They use words such as "expects," "may," "will," "believes," "should," "approximately," "anticipates," "estimates," and "plans." In addition, these words may use the positive or negative or other variations of those terms.

This release contains forward-looking statements regarding the company's expectations during the third quarter of 2013, including weaker domestic and export prices for Western logs, seasonally lower fee harvest from existing Western operations, comparable log price realizations and seasonally higher harvest volumes in the South, seasonally higher road and silviculture costs, somewhat higher earnings from disposition of non-strategic timberlands, just over two months of earnings from Longview Timber, seasonal slowdown in existing operations, and lower earnings from the Timberlands segment; substantially lower average selling prices for oriented strand board, lower lumber realizations, improved sales volumes across most product lines, lower log prices in the West, lower manufacturing costs and improved operating rates for OSB and engineered wood products, and lower earnings from the Wood Products segment; modestly improved average sales realizations and volumes for pulp and liquid packaging board, lower fiber and energy costs, higher maintenance costs and lower productivity due to additional planned annual outage days, and comparable earnings from the Cellulose Fibers segment; and seasonally increased home closings to more than 700 single-family homes, lower average margins due to mix, higher selling-related expenses due to the additional closing volume, somewhat higher earnings from the sale of land and lots, and higher earnings in the Real Estate segment.

Major risks, uncertainties and assumptions that affect the company's businesses and may cause actual results to differ from these forward-looking statements, include, but are not limited to:

  • the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages, and strength of the U.S. dollar;
  • market demand for the company's products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions;
  • performance of the company's manufacturing operations, including maintenance requirements;
  • the level of competition from domestic and foreign producers;
  • the successful execution of internal performance plans, including restructurings and cost reduction initiatives;
  • raw material prices;
  • energy prices;
  • the effect of weather;
  • the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters;
  • transportation costs;
  • federal tax policies;
  • the effect of forestry, land use, environmental and other governmental regulations;
  • legal proceedings;
  • performance of pension fund investments and related derivatives;
  • the effect of timing of retirements and changes in the market price of company stock on charges for stock-based compensation;
  • changes in accounting principles; and
  • other factors described under "Risk Factors" in the Company's annual report on Form 10-K and quarterly reports on Form 10-Q.

The company also is a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan and China. It is affected by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the euro and the Canadian dollar, and the relative value of the euro and the yen. Restrictions on international trade or tariffs imposed on imports also may affect the company.

For more information contact:

 Analysts - Kathryn McAuley (253) 924-2058

 Media - Anthony Chavez (253) 924-7148

 

Exhibit 99.2

Weyerhaeuser Company

Q2.2013 Analyst Package

Preliminary results, subject to audit

Consolidated Statement of Operations

in millions

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Net Sales

$ 1,951

$ 2,141

$ 1,793

$ 4,092

$ 3,287

Cost of products sold

1,533

1,664

1,516

3,197

2,806

Gross margin

418

477

277

895

481

Selling expenses

51

54

47

105

89

General and administrative expenses

118

108

95

226

203

Research and development expenses

7

8

8

15

15

Charges for restructuring, closures and impairments

4

6

4

10

16

Other operating income, net

(18)

(10)

(53)

(28)

(119)

Operating income

256

311

176

567

277

Interest income and other

11

10

11

21

23

Interest expense, net of capitalized interest

(82)

(81)

(86)

(163)

(173)

Earnings before income taxes

185

240

101

425

127

Income taxes

(41)

(42)

(17)

(83)

(2)

Net earnings

144

198

84

342

125

Dividends on preference shares

(2)

(2)

Net earnings attributable to Weyerhaeuser common shareholders

$     144

$     196

$       84

$     340

$     125

Per Share Information

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Basic earnings per share attributable to Weyerhaeuser common shareholders

$     0.26

$     0.35

$     0.16

$     0.62

$     0.23

Diluted earnings per share attributable to Weyerhaeuser common shareholders

$     0.26

$     0.35

$     0.16

$     0.61

$     0.23

Dividends paid per common share

$     0.17

$     0.20

$     0.15

$     0.37

$     0.30

Weighted average shares outstanding (in thousands):

Basic

545,234

552,855

537,966

549,159

537,667

Diluted

550,785

557,588

540,033

554,301

539,880

Common shares outstanding at end of period (in thousands)

546,573

577,874

537,526

577,874

537,526

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*

in millions

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Net earnings

$      144

$      198

$        84

$      342

$      125

Interest income and other

(11)

(10)

(11)

(21)

(23)

Interest expense, net of capitalized interest

82

81

86

163

173

Income taxes

41

42

17

83

2

Operating income

256

311

176

567

277

Depreciation, depletion and amortization

112

111

113

223

226

Non-operating pension and postretirement costs

10

12

7

22

14

Special items

(57)

(95)

Capitalized interest included in cost of products sold

9

13

19

22

22

Adjusted EBITDA, excluding special items*

$     387

$     447

$     258

$     834

$     444

* Non-GAAP measure - see page 9 for definition.

 

Weyerhaeuser Company

Q2.2013 Analyst Package

Preliminary results, subject to audit

Consolidated Balance Sheet

in millions

March 31, 2013

June 30, 2013

December 31, 2012

ASSETS

Forest Products:

Current assets:

    Cash and cash equivalents

$        635

$        908

$        893

    Receivables, less allowances

628

583

468

    Receivables for taxes

65

43

95

    Inventories

596

561

531

    Prepaid expenses

89

96

83

    Deferred tax assets

189

144

65

    Total current assets

2,202

2,335

2,135

Property and equipment, net

2,785

2,706

2,859

Construction in progress

56

72

50

Timber and timberlands at cost, less depletion charged to disposals

3,954

3,949

3,961

Cash and cash equivalents designated for the purchase of Longview Timber LLC

1,450

Investments in and advances to equity affiliates

191

186

192

Goodwill

40

42

40

Deferred tax assets

70

64

189

Other assets

351

349

358

Assets held by variable interest entities

804

621

805

10,453

11,774

10,589

Real Estate:

Cash and cash equivalents

4

4

5

Receivables, less allowances

75

74

72

Real estate in process of development and for sale

724

769

658

Land being processed for development

897

913

904

Investments in and advances to equity affiliates

20

20

21

Deferred tax assets

204

201

202

Other assets

100

112

94

Assets held by variable interest entities

33

41

47

2,057

2,134

2,003

Total assets

$ 12,510

$ 13,908

$ 12,592

LIABILITIES AND EQUITY

Forest Products:

Current liabilities:

    Notes payable

$          —

$            2

$          —

    Current maturities of long-term debt

184

163

340

    Accounts payable

357

341

329

    Accrued liabilities

531

568

561

    Total current liabilities

1,072

1,074

1,230

Long-term debt

3,842

3,842

3,842

Deferred income taxes

46

38

Deferred pension and other postretirement benefits

1,856

1,785

1,930

Other liabilities

455

446

499

Liabilities (nonrecourse to the company) held by variable interest entities

680

516

681

7,951

7,701

8,182

Real Estate:

Long-term debt

109

109

109

Other liabilities

172

188

187

Liabilities (nonrecourse to the company) held by variable interest entities

2

4

1

283

301

297

Total liabilities

8,234

8,002

8,479

Equity:

Total Weyerhaeuser shareholders' interest

4,244

5,868

4,070

Noncontrolling interests

32

38

43

Total equity

4,276

5,906

4,113

Total liabilities and equity

$ 12,510

$ 13,908

$ 12,592

 

Weyerhaeuser Company

Q2.2013 Analyst Package

Preliminary results, subject to audit

Consolidated Statement of Cash Flows

in millions

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Cash flows from operations:

Net earnings

$      144

$    198

$      84

$    342

$    125

Noncash charges (credits) to income:

    Depreciation, depletion and amortization

112

111

113

223

226

    Deferred income taxes, net

26

23

13

49

7

    Pension and other postretirement benefits

24

28

(30)

52

(58)

    Share-based compensation expense

12

10

8

22

18

    Charges for impairment of assets

1

2

4

3

12

    Net gains on dispositions of assets

(7)

(14)

(10)

(21)

(17)

    Foreign exchange transaction losses

4

4

9

8

2

Change in:

    Receivables less allowances

(165)

45

(18)

(120)

(23)

    Receivable for taxes

30

22

18

52

16

    Inventories

(68)

32

28

(36)

(12)

    Real estate and land

(59)

(62)

7

(121)

(48)

    Prepaid expenses

(13)

(1)

(12)

(14)

(20)

    Accounts payable and accrued liabilities

(66)

34

65

(32)

9

    Deposits on land positions and other assets

(1)

(9)

22

(10)

22

Pension and postretirement contributions

(37)

(32)

(33)

(69)

(68)

Other

2

(17)

(1)

(15)

16

Net cash from operations

(61)

374

267

313

207

Cash flows from investing activities:

Property and equipment

(35)

(47)

(68)

(82)

(122)

Timberlands reforestation

(13)

(8)

(7)

(21)

(17)

Proceeds from sale of assets

6

8

18

14

24

Proceeds of investments held by special purpose entities

22

22

Other

(4)

(1)

(4)

Cash from investing activities

(42)

(29)

(58)

(71)

(115)

Cash flows from financing activities:

Net proceeds from issuance of common shares(1)

781

781

Net proceeds from issuance of preference shares(1)

669

669

Cash dividends on common shares

(93)

(109)

(80)

(202)

(161)

Change in book overdrafts

3

4

9

7

(20)

Payments on debt

(156)

(21)

(4)

(177)

(6)

Exercises of stock options

81

51

2

132

7

Other

9

3

(3)

12

(4)

Cash from financing activities

(156)

1,378

(76)

1,222

(184)

Net change in cash and cash equivalents

(259)

1,723

133

1,464

(92)

Cash and cash equivalents at beginning of period

898

639

728

898

953

Cash and cash equivalents at end of period

$      639

$ 2,362

$    861

$ 2,362

$    861

Cash paid (received) during the year for:

Interest, net of amount capitalized

$      111

$      55

$      54

$    166

$    168

Income taxes

$        (2)

$       (4)

$       (5)

$       (6)

$     (15)

(1) During second quarter 2013, we received $1,450 million in cash related to the issuance of common shares and mandatory convertible preference shares related to the acquisition of Longview Timber LLC. We have recorded this cash as "Cash and cash equivalents designated for the purchase of Longview Timber LLC" on our Consolidated Balance Sheet.

 

Weyerhaeuser Company

Total Company Statistics

Q2.2013 Analyst Package

Preliminary results, subject to audit

Special Items Included in Net Earnings

in millions

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Net earnings attributable to Weyerhaeuser common shareholders

$    144

$  196

$         84

$       340

$       125

Restructuring, impairments and other charges

10

Gain on postretirement plan amendment

(33)

(67)

Tax settlements

(8)

Gain on sale of property

(4)

(4)

Net earnings attributable to Weyerhaeuser common shareholders before special items

$    144

$  196

$         47

$       340

$         56

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Net earnings per diluted share attributable to Weyerhaeuser common shareholders

$   0.26

$ 0.35

$      0.16

$      0.61

$      0.23

Restructuring, impairments and other charges

0.02

Gain on postretirement plan amendment

(0.06)

(0.12)

Tax settlements

(0.02)

Gain on sale of property

(0.01)

(0.01)

Net earnings per diluted share attributable to Weyerhaeuser common shareholders before special items

$   0.26

$ 0.35

$      0.09

$      0.61

$      0.10

Selected Total Company Items

in millions

Q1

Q2

Year-to-date

March 31, 2013

June 30, 2013

June 30, 2012

June 30, 2013

June 30, 2012

Depreciation, depletion and amortization:

Cost of products sold

$      103

$    102

$        103

$        205

$        205

Selling, general and administrative expenses

9

9

10

18

21

Total depreciation, depletion and amortization

$      112

$    111

$        113

$        223

$        226

Pension and postretirement costs:

Pension and postretirement costs allocated to business segments

$        14

$      16

$          14

$          30

$          27

Pension and postretirement costs not allocated

10

12

7

22

14

Total company pension and postretirement costs

$        24

$      28

$          21

$          52

$          41

Total decrease (increase) in Forest Products working capital(1)

$    (334)

$    161

$        103

$      (173)

$        (45)

Cash spent for capital expenditures

$      (48)

$    (55)

$        (75)

$      (103)

$      (139)

(1)Working capital does not include cash balances.

 

Weyerhaeuser Company

Timberlands Segment

Q2.2013 Analyst Package

Preliminary results, subject to audit

Segment Statement of Operations

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Sales to unaffiliated customers

$      293

$      333

$     262

$       626

$       512

Intersegment sales

224

166

146

390

336

Total net sales

517

499

408

1,016

848

Cost of products sold

395

365

313

760

666

Gross margin

122

134

95

256

182

Selling expenses

3

2

2

5

4

General and administrative expenses

25

25

21

50

44

Research and development expenses

4

5

5

9

9

Charges for restructuring, closures and impairments

2

2

Other operating income, net

(15)

(11)

(10)

(26)

(21)

Operating income

103

113

77

216

146

Interest income and other

1

1

2

1

Net contribution to earnings

$     104

$     114

$      77

$     218

$     147

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Operating income

$     103

$     113

$      77

$     216

$     146

Depreciation, depletion and amortization

36

34

34

70

69

Adjusted EBITDA, excluding special items*

$     139

$     147

$   111

$     286

$     215

* Non-GAAP measure - see page 9 for definition.

Selected Segment Items

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Total decrease (increase) in working capital(1)

$      (10)

$      (21)

$         6

$       (31)

$         (3)

Cash spent for capital expenditures

$      (18)

$      (18)

$     (15)

$       (36)

$       (27)

(1)Working capital does not include cash balances.

Segment Statistics

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Third Party  Net Sales  (millions)

Logs:

  West

$      177

$      208

$     146

$       385

$       276

  South

61

65

56

126

106

  Canada

7

2

2

9

9

Total logs

245

275

204

520

391

Pay as cut timber sales

1

4

3

5

6

Chip sales

3

2

4

5

10

Timberlands exchanges

2

14

7

16

15

Higher and better use land sales

3

5

5

8

9

Minerals, oil and gas

8

9

7

17

14

Products from international operations

22

22

29

44

54

Other products

9

2

3

11

13

Total

$      293

$      333

$     262

$       626

$       512

Logs Third Party Sales Realizations (per cubic meter)

West

$ 105.38

$ 115.11

$  94.47

$  110.44

$    96.59

South

$   43.47

$   43.47

$  41.15

$    43.47

$    40.83

Canada

$   36.61

$   36.38

$  34.66

$    36.57

$    36.00

International

$   24.01

$   25.00

$  23.53

$    24.54

$    23.26

Logs Third Party Sales Volumes (cubic meters, thousands)

West

1,674

1,812

1,551

3,486

2,859

South

1,399

1,507

1,354

2,906

2,582

Canada

204

38

54

242

259

International

68

77

82

145

160

Total

3,345

3,434

3,041

6,779

5,860

Logs Fee Harvest Volumes (cubic meters, thousands)

West

1,995

1,921

1,831

3,916

3,510

South

2,833

2,828

2,788

5,661

5,502

International

197

167

161

364

333

Total

5,025

4,916

4,780

9.941

9.345

Weyerhaeuser Company

Wood Products Segment

Q2.2013 Analyst Package

Preliminary results, subject to audit

Segment Statement of Operations  

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Sales to unaffiliated customers

$     988

$  1,065

$     776

$    2,053

$    1,410

Intersegment sales

18

18

20

36

40

Total net sales

1,006

1,083

796

2,089

1,450

Cost of products sold

770

884

708

1,654

1,319

Gross margin

236

199

88

435

131

Selling expenses

26

24

21

50

42

General and administrative expenses

36

36

29

72

58

Research and development expenses

1

1

1

2

2

Charges for restructuring, closures and impairments

1

2

1

3

Other operating costs (income), net

(5)

1

(1)

(4)

4

Operating income

178

136

36

314

22

Interest income and other

1

Net contribution to earnings

$   178

$   136

$      36

$     314

$        23

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Operating income

$   178

$   136

$      36

$     314

$        22

Depreciation, depletion and amortization

31

31

33

62

67

Special items

(6)

(6)

Adjusted EBITDA, excluding special items*

$   209

$   167

$      63

$     376

$        83

* Non-GAAP measure - see page 9 for definition.

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

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Gain on sale of property

$      —

$      —

$         6

$        —

$           6

Total

$      —

$      —

$        6

$        —

$          6

Selected Segment Items

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Total decrease (increase) in working capital(1)

$   (194)

$       75

$         5

$     (119)

$     (107)

Cash spent for capital expenditures

$     (10)

$     (16)

$     (15)

$       (26)

$       (21)

(1)Working capital does not include cash balances.

Segment Statistics

in millions, except for third-party sales realizations

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Structural Lumber (board feet)

Third party net sales

$     451

$     502

$     370

$       953

$       661

Third party sales realizations

$     440

$     434

$     350

$       437

$       332

Third party sales volumes(1)

1,025

1,156

1,056

2,181

1,993

Production volumes

1,021

1,053

1,004

2,074

1,962

Outside purchase volumes

102

77

47

179

79

Engineered Solid Section (cubic feet)

Third party net sales

$       82

$       84

$       70

$       166

$       135

Third party sales realizations

$  1,850

$  1,920

$  1,789

$    1,885

$    1,809

Third party sales volumes(1)

4.4

4.4

3.9

8.8

7.5

Production volumes

4.6

4.6

3.8

9.2

7.5

Outside purchase volumes

0.9

0.4

0.2

1.3

1.2

Engineered I-joists (lineal feet)

Third party net sales

$       56

$       60

$       49

$       116

$         90

Third party sales realizations

$  1,300

$  1,358

$  1,211

$    1,330

$    1,244

Third party sales volumes(1)

43

44

40

87

72

Production volumes

44

42

37

86

71

Outside purchase volumes

3

1

2

4

4

Oriented Strand Board (square feet 3/8')

Third party net sales

$     236

$     224

$     138

$       460

$       249

Third party sales realizations

$     359

$     332

$     214

$       345

$       206

Third party sales volumes(1)

657

675

643

1,332

1,208

Production volumes

662

663

626

1,325

1,227

Outside purchase volumes

68

56

48

124

80

Softwood Plywood (square feet 3/8')

Third party net sales

$       36

$       41

$       26

$         77

$         49

Third party sales realizations

$     370

$     378

$     332

$       374

$       321

Third party sales volumes(1)

99

108

81

207

154

Production volumes

61

63

50

124

101

Outside purchase volumes

42

33

29

75

54

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

 

Weyerhaeuser Company

Cellulose Fibers Segment

Q2.2013 Analyst Package

Preliminary results, subject to audit

Segment Statement of Operations

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Total net sales

$   474

$   476

$   459

$     950

$     932

Cost of products sold

424

394

404

818

811

Gross margin

50

82

55

132

121

Selling expenses

4

5

5

9

9

General and administrative expenses

20

21

17

41

37

Research and development expenses

2

2

2

4

4

Other operating income, net

(7)

(5)

(4)

(12)

(13)

Operating income

31

59

35

90

84

Interest income and other

(2)

1

(2)

Net contribution to earnings

$      31

$      57

$      36

$        88

$        84

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Operating income

$      31

$      59

$      35

$        90

$        84

Depreciation, depletion and amortization

39

39

36

78

73

Adjusted EBITDA, excluding special items*

$      70

$      98

$      71

$     168

$     157

* Non-GAAP measure - see page 9 for definition.

Selected Segment Items

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Total decrease (increase) in working capital(1)

$       (7)

$       12

$       24

$           5

$         69

Cash spent for capital expenditures

$     (17)

$     (17)

$     (44)

$       (34)

$       (89)

(1)Working capital does not include cash balances.

Segment Statistics

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Pulp (air-dry metric tons)

Third party net sales (millions)

$     371

$     369

$     348

$       740

$       715

Third party sales realizations

$     796

$     797

$     819

$       797

$       819

Third party sales volumes (thousands)

467

462

425

929

874

Production volumes (thousands)

445

463

417

908

855

Liquid Packaging Board (tons)

Third party net sales (millions)

$       85

$       86

$       90

$       171

$       173

Third party sales realizations

$  1,079

$  1,079

$  1,176

$    1,079

$    1,179

Third party sales volumes (thousands)

78

81

76

159

146

Production volumes (thousands)

78

77

78

155

143

 

Weyerhaeuser Company

Real Estate Segment

Q2.2013 Analyst Package

Preliminary results, subject to audit

Segment Statement of Operations

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Total net sales

$   196

$   267

$   296

$     463

$     433

Cost of products sold

160

210

248

370

361

Gross margin

36

57

48

93

72

Selling expenses

18

23

19

41

34

General and administrative expenses

18

19

15

37

32

Charges for restructuring, closures and impairments

1

3

1

4

2

Other operating income, net

(1)

(1)

(1)

(1)

Operating income (loss)

(1)

13

14

12

5

Interest income and other

1

1

1

2

2

Net contribution to earnings

$      —

$      14

$      15

$        14

$          7

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Operating income (loss)

$      (1)

$      13

$      14

$        12

$          5

Depreciation, depletion and amortization

3

3

3

6

5

Capitalized interest included in cost of products sold

7

12

14

19

17

Adjusted EBITDA, excluding special items*

$        9

$      28

$      31

$        37

$        27

* Non-GAAP measure - see page 9 for definition.

Selected Segment Items

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Cash from operations

$     (71)

$     (56)

$       43

$     (127)

$         11

Cash spent for capital expenditures

$       (2)

$       (2)

$      —

$         (4)

$         (1)

Segment Statistics

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Net sales:

  Single-family housing

$     183

$     257

$     190

$       440

$       321

  Land

11

10

105

21

108

  Other

2

1

2

4

  Total net sales

$     196

$     267

$     296

$       463

$       433

Single-family homes sold

820

943

764

1,763

1,461

Single-family homes closed

463

636

508

1,099

857

Single-family homes sold but not closed (backlog)

1,131

1,438

1,033

1,438

1,033

Single-family cancellation rate

12.2 %

14.6 %

15.4 %

13.5 %

12.9 %

Single-family buyer traffic

17,764

20,080

17,677

37,844

31,949

Single-family average price of homes closed (in thousands)

$    394

$    405

$    374

$      400

$      375

Single-family gross margin(1)

19.5 %

21.6 %

19.3 %

20.7 %

18.4 %

(1)Single-family gross margin equals revenue less cost of sales and period costs.

 

Weyerhaeuser Company

Unallocated Items

Q2.2013 Analyst Package

Preliminary results, subject to audit

Unallocated items are gains or charges not related to or allocated to an individual operating segment. They include a portion of items such as: share-based compensation, pension and postretirement costs, foreign exchange transaction gains and losses associated with financing and the elimination of intersegment profit in inventory and the LIFO reserve.

Contribution to Earnings

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Unallocated corporate function expenses

$       (3)

$       (3)

$       (3)

$         (6)

$         (9)

Unallocated share-based compensation

(7)

5

(1)

(2)

(6)

Unallocated pension & postretirement costs

(10)

(12)

(7)

(22)

(14)

Foreign exchange losses

(4)

(4)

(8)

(8)

(2)

Elimination of intersegment profit in inventory and LIFO

(24)

8

(2)

(16)

(14)

Other

(7)

(4)

35

(11)

65

Operating income (loss)

(55)

(10)

14

(65)

20

Interest income and other

9

10

9

19

19

Net contribution to earnings

$    (46)

$      —

$      23

$      (46)

$        39

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*

in millions

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Operating income (loss)

$    (55)

$    (10)

$      14

$      (65)

$        20

Depreciation, depletion and amortization

3

4

7

7

12

Non-operating pension and postretirement costs

10

12

7

22

14

Special items

(51)

(89)

Capitalized interest included in cost of products sold

2

1

5

3

5

Adjusted EBITDA, excluding special items*

$    (40)

$        7

$    (18)

$      (33)

$      (38)

* Non-GAAP measure - see below for definition.

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

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Gain on postretirement plan amendment

$      —

$      —

$       51

$        —

$       103

Restructuring, impairments and other charges

(14)

Total

$      —

$      —

$      51

$        —

$        89

Unallocated Selected Items

Q1.2013

Q2.2013

Q2.2012

YTD.2013

YTD.2012

Total decrease (increase) in working capital(1)

$   (123)

$       95

$       68

$       (28)

$         (4)

Cash spent for capital expenditures

$       (1)

$       (2)

$       (1)

$         (3)

$         (1)

(1)Working capital does not include cash balances.

*Adjusted EBITDA excluding special items is a non-GAAP measure that management uses to evaluate the performance of the company. Adjusted EBITDA excluding special items, as we define it, is operating income adjusted for depreciation, depletion, amortization, special items and interest included in cost of products sold. Adjusted EBITDA excluding special items should not be considered in isolation from and is not intended to represent an alternative to our results computed under GAAP.

 

SOURCE Weyerhaeuser Company



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http://www.weyerhaeuser.com