Rayonier Inc. RYN reported a third-quarter 2024 pro-forma net income of 12 cents per share, missing the Zacks Consensus Estimate and the year-ago quarter’s figure of 13 cents.
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Total revenues came in at $195.0 million, which lagged the Zacks Consensus Estimate of $222.4 million. On a year-over-year basis, the figure decreased 3.3%. Adjusted EBITDA came in at $71.8 million, down from $78.9 million in the prior-year period. This 9% decrease year over year is due to a lower contribution from its New Zealand Timber segment.
According to Mark McHugh, president and CEO of Rayonier, “We delivered solid operational results in the third quarter, despite macroeconomic challenges that continue to adversely impact our timber businesses.”. He also noted, “During the third quarter, we also significantly advanced our $1 billion disposition initiative, which led to the closing of several large transactions following the end of the quarter.”
Concurrent with the earnings release, Rayonier announced completed and pending timberland dispositions aggregating around 200,000 acres for a total purchase price of $495 million. The company also updated its full-year adjusted EBITDA guidance to reflect current outlook and disposition activity.
RYN’s Segmental Performance
In the third quarter, the pro-forma operating income in the company’s Southern Timber segment came in at $19.8 million, which increased $1.2 million from the prior-year quarter. Higher non-timber income and lower costs were partly offset by lower volumes, higher depletion expenses and lower net stumpage realizations.
The Pacific Northwest Timber segment reported a pro-forma operating income of $0.8 million compared to a loss of $0.6 million a year ago. This was driven by lower depletion expenses, lower costs and higher volumes, offset by lower net stumpage realizations.
The New Zealand Timber segment recorded pro-forma operating income of $8.9 million, down from the year-earlier quarter’s $17.6 million. This rise was due to lower carbon credit income, lower net stumpage realizations, higher costs and lower volumes, which were partly mitigated by favorable foreign exchange impacts and lower depletion rates.
Real Estate’s pro-forma operating income was $8.6 million, down from $9.2 million reported in the year-ago period. This reflects lower acres sold, offset by higher weighted-average prices.
The Trading segment reported an operating loss of $0.1 million, consistent with the prior-year quarter.
RYN’s Balance Sheet
Rayonier exited the third quarter of 2024 with $74.2 million in cash and cash equivalents, down from $141.9 million as of June 30, 2024.
RYN’s Outlook
Management expects full-year net income attributable to Rayonier in the band of $343-$359 million, EPS of $2.30 to $2.40, pro forma EPS of 36 to 40 cents and adjusted EBITDA of $275 to $290 million.
The Zacks Consensus Estimate for 2024 EPS is currently pegged at 38 cents.
The revised expectations for the year reflect slightly lower harvest volumes due to its recently announced timberland dispositions.
Currently, Rayonier carries a Zacks Rank #4 (Sell).
Rayonier Inc. Price, Consensus and EPS Surprise
Rayonier Inc. price-consensus-eps-surprise-chart | Rayonier Inc. Quote
Performance of Other REITs
Public Storage PSA reported third-quarter 2024 core funds from operations (FFO) per share of $4.20, which missed the Zacks Consensus Estimate of $4.25. Also, the figure declined 3% year over year.
Public Storage experienced lower realized annual rent per occupied square foot and a decline in occupancy, as well as a rise in other direct property costs, repairs and maintenance expenses, marketing expenses and interest expenses, in the quarter. Presently, PSA carries a Zacks Rank #3 (Hold).
Federal Realty Investment Trust’s FRT third-quarter 2024 FFO per share of $1.71 narrowly missed the Zacks Consensus Estimate of $1.72. However, this marked a rise of 3.6% from the year-ago quarter’s tally of $1.65.
Results reflected healthy leasing activity and significant occupancy gains at its properties. FRT also tightened and increased its guidance for 2024 FFO per share. Currently, FRT carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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