Weyerhaeuser Reports Third Quarter Results

• Achieved net earnings of $239 million, or $0.33 per diluted share
• Generated Adjusted EBITDA of $509 million, a 9 percent increase compared with second quarter 2023
• Received approval for the company's first forest carbon credits

SEATTLE, Oct. 26, 2023 /PRNewswire/ -- Weyerhaeuser Company (NYSE: WY) today reported third quarter net earnings of $239 million, or 33 cents per diluted share, on net sales of $2.0 billion. This compares with net earnings of $310 million, or 42 cents per diluted share, on net sales of $2.3 billion for the same period last year and net earnings of $230 million for second quarter 2023. There were no special items in third quarter 2023 or the same period last year. Net earnings before special items were $238 million for second quarter 2023. Adjusted EBITDA for third quarter 2023 was $509 million compared with $583 million for the same period last year and $469 million for second quarter 2023.

"In the third quarter, we delivered solid results across our businesses," said Devin W. Stockfish, president and chief executive officer. "In addition, we achieved an important milestone in our Natural Climate Solutions growth program with the approval of our first forest carbon credits in Maine. Looking ahead, although near-term market conditions have moderated, we remain constructive on the longer-term demand fundamentals that support our businesses. Our balance sheet is exceptionally strong, and we remain focused on maintaining our industry-leading operating performance, serving our customers and delivering superior long-term value and returns for our shareholders."

WEYERHAEUSER FINANCIAL HIGHLIGHTS		2023				2023				2022
(millions, except per share data)		Q2				Q3				Q3
Net sales		$	1,997			$	2,022			$	2,276
Net earnings		$	230			$	239			$	310
Net earnings per diluted share		$	0.31			$	0.33			$	0.42
Weighted average shares outstanding, diluted			732				732				741
Net earnings before special items(1)(2)		$	238			$	239			$	310
Net earnings per diluted share before special items(1)		$	0.32			$	0.33			$	0.42
Adjusted EBITDA(1)		$	469			$	509			$	583
Net cash from operations		$	496			$	523			$	562
Adjusted FAD(3)		$	415			$	424			$	468

(1)	Net earnings before special items is a non-GAAP measure that management believes provides helpful context in understanding the company's earnings performance. Additionally, Adjusted EBITDA is a non-GAAP measure that management uses to evaluate the performance of the company. Adjusted EBITDA, as we define it, is operating income adjusted for depreciation, depletion, amortization, basis of real estate sold and special items. Net earnings before special items and Adjusted EBITDA should not be considered in isolation from, and are not intended to represent an alternative to, our GAAP results. Reconciliations of net earnings before special items and Adjusted EBITDA to GAAP earnings are included within this release.
(2)	Special items for prior periods presented are included in the reconciliation tables within this release.
(3)	Adjusted Funds Available for Distribution (Adjusted FAD) is a non-GAAP measure that management uses to evaluate the company's liquidity. Adjusted FAD, as we define it, is net cash from operations adjusted for capital expenditures and significant non-recurring items. Adjusted FAD measures cash generated during the period (net of capital expenditures and significant non-recurring items) that is available for dividends, repurchases of common shares, debt reduction, acquisitions, and other discretionary and nondiscretionary capital allocation activities. Adjusted FAD should not be considered in isolation from, and is not intended to represent an alternative to, our GAAP results. A reconciliation of Adjusted FAD to net cash from operations is included within this release.

TIMBERLANDS

FINANCIAL HIGHLIGHTS		2023				2023
(millions)		Q2				Q3				Change
Net sales		$	567			$	521			$	(46)
Net contribution to pretax earnings		$	104			$	78			$	(26)
Adjusted EBITDA		$	172			$	143			$	(29)

Q3 2023 Performance – In the West, fee harvest and domestic sales volumes were moderately lower than the second quarter as a result of higher elevation harvest operations and temporary harvest restrictions due to wildfire risk. Export sales volumes were significantly lower, which was partially driven by fewer export shipments to Japan. Sales realizations were slightly lower, partially driven by a reduction in export volumes, while domestic sales realizations were comparable. Per unit log and haul costs were lower. In the South, fee harvest volumes were moderately lower, partly due to wet conditions early in the quarter. Sales realizations were slightly lower, and per unit log and haul costs were comparable. Forestry and road costs in the West and South were seasonally higher.

Q4 2023 Outlook – Weyerhaeuser anticipates fourth quarter earnings and Adjusted EBITDA will be comparable to the third quarter. In the West, the company expects fee harvest volumes, sales realizations and forestry and road costs to be comparable. Per unit log and haul costs are expected to be moderately higher. In the South, the company expects fee harvest volumes, sales realizations and per unit log and haul costs to be comparable to the third quarter. Forestry and road costs are expected to be moderately lower.

REAL ESTATE, ENERGY & NATURAL RESOURCES

FINANCIAL HIGHLIGHTS		2023				2023
(millions)		Q2				Q3				Change
Net sales		$	80			$	105			$	25
Net contribution to pretax earnings		$	52			$	56			$	4
Adjusted EBITDA		$	70			$	94			$	24

Q3 2023 Performance – Earnings and Adjusted EBITDA increased from the second quarter due to higher real estate sales. The number of acres sold increased significantly due to the timing of transactions. The average price per acre was significantly lower and the average basis as a percentage of sales was significantly higher due to the mix of properties sold.

Q4 2023 Outlook – Weyerhaeuser anticipates fourth quarter earnings and Adjusted EBITDA will be lower than the third quarter due to the timing and mix of real estate sales. The company now expects full year 2023 Adjusted EBITDA to be approximately $310 million, a $10 million increase from prior outlook, and continues to expect basis as a percentage of real estate sales to be 35 to 40 percent for the full year.  

WOOD PRODUCTS

FINANCIAL HIGHLIGHTS		2023				2023
(millions)		Q2				Q3				Change
Net sales		$	1,500			$	1,537			$	37
Net contribution to pretax earnings		$	218			$	277			$	59
Adjusted EBITDA		$	270			$	328			$	58

Q3 2023 Performance – Sales realizations for lumber were comparable to the second quarter average, while sales realizations for oriented strand board increased 39 percent. Sales volumes for lumber were slightly lower due to reduced production at several mills, partially driven by temporary operational disruptions. Unit manufacturing costs were comparable and log costs were moderately lower. For oriented strand board, sales volumes were moderately lower and unit manufacturing costs were slightly higher due to planned downtime for annual maintenance. Sales realizations were slightly lower for most engineered wood products, while sales volumes were slightly higher, primarily for solid section products. Unit manufacturing costs were slightly higher and raw material costs were higher, primarily for oriented strand board webstock.

Q4 2023 Outlook – Weyerhaeuser anticipates fourth quarter earnings and Adjusted EBITDA will be moderately lower than the third quarter, excluding the effect of changes in average sales realizations for lumber and oriented strand board. For lumber, the company expects moderately higher sales volumes, comparable log costs, and slightly lower unit manufacturing costs. For oriented strand board, the company anticipates moderately higher sales volumes, slightly higher fiber costs, and slightly lower unit manufacturing costs. For engineered wood products, the company expects lower sales realizations, slightly higher raw material costs, and slightly lower sales volumes, primarily for solid section products. For distribution, the company anticipates lower results compared to the third quarter, primarily driven by a decrease in commodity realizations.

ABOUT WEYERHAEUSER

Weyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control approximately 11 million acres of timberlands in the U.S. and manage additional timberlands 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 products in North America. Our company is a real estate investment trust. In 2022, we generated $10.2 billion in net sales and employed approximately 9,200 people who serve customers worldwide. Our common stock trades on the New York Stock Exchange under the symbol WY. Learn more at www.weyerhaeuser.com. 

EARNINGS CALL INFORMATION

Weyerhaeuser will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on October 27, 2023 to discuss third quarter results.

To access the live webcast and presentation online, go to the Investor Relations section on www.weyerhaeuser.com on October 27, 2023.

To join the conference call from within North America, dial 1-877-407-0792 (access code: 13734909) at least 15 minutes prior to the call. Those calling from outside North America should dial 201-689-8263 (access code: 13734909). Replays will be available for two weeks at 1-844-512-2921 (access code: 13734909) from within North America, and at 1-412-317-6671 (access code: 13734909) 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, including, but not limited to, with respect to our outlook and expectations concerning the following: long-term demand drivers and fundamentals and future operating performance and delivery of long-term shareholder value and returns; earnings and Adjusted EBITDA for the company and for each of our businesses; fee harvest volumes, sales realizations, log and haul costs and forestry and road costs for our Timberlands business; sales volumes, log costs and unit manufacturing costs for our lumber business; sales volumes, fiber costs and unit manufacturing costs for our oriented strand board business; sales volumes, sales realizations and raw material costs for our engineered wood products business; commodity realizations for our distribution business; and basis as a percentage of real estate sales in our Real Estate, Energy and Natural Resources business. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often involve use of words and expressions such as "anticipate," "expect," "looking forward," "maintain," "planned," "will," and similar words and expressions. They may use the positive, negative or another variation of those and similar words and expressions. These forward-looking statements are based on our current expectations and assumptions and are not guarantees of future events or performance. The realization of our expectations and the accuracy of our assumptions are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include, but are not limited to:

• the effect of general economic conditions, including employment rates, interest rate levels, inflation, housing starts, general availability and cost of financing for home mortgages and the relative strength of the U.S. dollar;
• the effect of COVID-19 and other viral or disease outbreaks and their potential effects on our business, results of operations, cash flows, financial condition and future prospects;
• market demand for the company's products, including market demand for our timberland properties with higher and better uses, which is related to, among other factors, the strength of the various U.S. business segments and U.S. and international economic conditions;
• changes in currency exchange rates, particularly the relative value of the U.S. dollar to the Japanese yen, the Chinese yuan, and the Canadian dollar, and the relative value of the euro to the yen;
• restrictions on international trade and tariffs imposed on imports or exports;
• the availability and cost of shipping and transportation;
• economic activity in Asia, especially Japan and China;
• performance of our manufacturing operations, including maintenance and capital requirements;
• potential disruptions in our manufacturing operations;
• the level of competition from domestic and foreign producers;
• the successful execution of our internal plans and strategic initiatives, including restructuring and cost reduction initiatives;
• our ability to hire and retain capable employees;
• the successful and timely execution and integration of our strategic acquisitions, including our ability to realize expected benefits and synergies, and the successful and timely execution of our strategic divestitures, each of which is subject to a number of risks and conditions beyond our control including, but not limited to, timing and required regulatory approvals or the occurrence of any event, change or other circumstances that could give rise to a termination of any acquisition or divestiture transaction under the terms of the governing transaction agreements;
• raw material availability and prices;
• the effect of weather;
• changes in global or regional climate conditions and governmental response to such changes;
• the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters;
• energy prices;
• transportation and labor availability and 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 employee retirements as it relates to the cost of pension benefits and changes in the market price of our common stock on charges for share-based compensation;
• the accuracy of our estimates of costs and expenses related to contingent liabilities and the accuracy of our estimates of charges related to casualty losses;
• changes in accounting principles; and
• other risks and uncertainties identified in our 2022 Annual Report on Form 10-K, as well as those set forth from time to time in our other public statements, reports, registration statements, prospectuses, information statements and other filings with the SEC.

It is not possible to predict or identify all risks and uncertainties that might affect the accuracy of our forward-looking statements and, consequently, our descriptions of such risks and uncertainties should not be considered exhaustive. There is no guarantee that any of the events anticipated by these forward-looking statements will occur, and if any of the events do occur, there is no guarantee what effect they will have on the company's business, results of operations, cash flows, financial condition and future prospects.

Forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update or revise any forward-looking statements, whether because of new information, future events, or otherwise.

RECONCILIATION OF ADJUSTED EBITDA TO NET EARNINGS

We reconcile Adjusted EBITDA to net earnings for the consolidated company and to operating income (loss) for the business segments, as those are the most directly comparable U.S. GAAP measures for each.

The table below reconciles Adjusted EBITDA for the quarter ended June 30, 2023:

(millions)		Timberlands				Real Estate & ENR				Wood Products				Unallocated Items				Total
Adjusted EBITDA by Segment:
Net earnings																		$	230
Interest expense, net of capitalized interest																			70
Income taxes																			25
Net contribution (charge) to earnings		$	104			$	52			$	218			$	(49)			$	325
Non-operating pension and other post-employment benefit costs			—				—				—				12				12
Interest income and other			—				—				—				(18)				(18)
Operating income (loss)			104				52				218				(55)				319
Depreciation, depletion and amortization			68				5				52				1				126
Basis of real estate sold			—				13				—				—				13
Special items included in operatingincome (loss)(1)			—				—				—				11				11
Adjusted EBITDA		$	172			$	70			$	270			$	(43)			$	469

(1)	Operating income (loss) for Unallocated Items includes a pretax special item consisting of an $11 million noncash environmental remediation charge.

 

The table below reconciles Adjusted EBITDA for the quarter ended September 30, 2023:

(millions)		Timberlands				Real Estate & ENR				Wood Products				Unallocated Items				Total
Adjusted EBITDA by Segment:
Net earnings																		$	239
Interest expense, net of capitalizedinterest																			72
Income taxes																			54
Net contribution (charge) to earnings		$	78			$	56			$	277			$	(46)			$	365
Non-operating pension and other post-employment benefit costs			—				—				—				12				12
Interest income and other			—				—				—				(24)				(24)
Operating income (loss)			78				56				277				(58)				353
Depreciation, depletion and amortization			65				4				51				2				122
Basis of real estate sold			—				34				—				—				34
Adjusted EBITDA		$	143			$	94			$	328			$	(56)			$	509

 

The table below reconciles Adjusted EBITDA for the quarter ended September 30, 2022:

(millions)		Timberlands				Real Estate & ENR				Wood Products				Unallocated Items				Total
Adjusted EBITDA by Segment:
Net earnings																		$	310
Interest expense, net of capitalizedinterest																			67
Income taxes																			77
Net contribution (charge) to earnings		$	107			$	48			$	344			$	(45)			$	454
Non-operating pension and other post-employment benefit costs			—				—				—				12				12
Interest income and other			—				—				—				(9)				(9)
Operating income (loss)			107				48				344				(42)			$	457
Depreciation, depletion and amortization			61				5				51				2				119
Basis of real estate sold			—				7				—				—				7
Adjusted EBITDA		$	168			$	60			$	395			$	(40)			$	583

 

 

The table below reconciles Adjusted EBITDA for the year-to-date period ended September 30, 2023:

(millions)		Timberlands				Real Estate & ENR				Wood Products				Unallocated Items				Total
Adjusted EBITDA by Segment:
Net earnings																		$	620
Interest expense, net of capitalized interest																			208
Income taxes																			101
Net contribution (charge) to earnings		$	302			$	161			$	590			$	(124)			$	929
Non-operating pension and other post-employment benefit costs			—				—				—				33				33
Interest income and other			—				—				—				(54)				(54)
Operating income (loss)			302				161				590				(145)				908
Depreciation, depletion and amortization			201				12				156				5				374
Basis of real estate sold			—				80				—				—				80
Special items included in operatingincome (loss)(1)			—				—				—				11				11
Adjusted EBITDA		$	503			$	253			$	746			$	(129)			$	1,373

(1)	Operating income (loss) for Unallocated Items includes a pretax special item consisting of an $11 million noncash environmental remediation charge.

RECONCILIATION OF NET EARNINGS BEFORE SPECIAL ITEMS TO NET EARNINGS

We reconcile net earnings before special items to net earnings and net earnings per diluted share before special items to net earnings per diluted share, as those are the most directly comparable U.S. GAAP measures. We believe the measures provide meaningful supplemental information for investors about our operating performance, better facilitate period to period comparisons and are widely used by analysts, lenders, rating agencies and other interested parties.

The table below reconciles net earnings before special items to net earnings:

		2023				2023				2022
(millions)		Q2				Q3				Q3
Net earnings		$	230			$	239			$	310
Environmental remediation charge			8				—				—
Net earnings before special items		$	238			$	239			$	310

 

The table below reconciles net earnings per diluted share before special items to net earnings per diluted share:

		2023				2023				2022
		Q2				Q3				Q3
Net earnings per diluted share		$	0.31			$	0.33			$	0.42
Environmental remediation charge			0.01				—				—
Net earnings per diluted share before special items		$	0.32			$	0.33			$	0.42

 

RECONCILIATION OF ADJUSTED FAD TO NET CASH FROM OPERATIONS

We reconcile Adjusted FAD to net cash from operations, as that is the most directly comparable U.S. GAAP measure. We believe the measure provides meaningful supplemental information for investors about our liquidity.

The table below reconciles Adjusted FAD to net cash from operations:

		2023				2023				2022				2023
(millions)		Q2				Q3				Q3				Q3 YTD
Net cash from operations		$	496			$	523			$	562			$	1,145
Capital expenditures			(81)				(99)				(94)				(251)
Adjusted FAD		$	415			$	424			$	468			$	894

 

 

 

Weyerhaeuser Company																			Exhibit 99.2
Q3.2023 Analyst Package
Preliminary results (unaudited)
Consolidated Statement of Operations
		Q1				Q2				Q3								Year-to-Date
in millions		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Net sales		$	1,881			$	1,997			$	2,022			$	2,276			$	5,900			$	8,361
Costs of sales			1,512				1,528				1,520				1,694				4,560				5,130
Gross margin			369				469				502				582				1,340				3,231
Selling expenses			22				22				22				24				66				70
General and administrative expenses			101				108				107				100				316				294
Other operating costs, net			10				20				20				1				50				19
Operating income			236				319				353				457				908				2,848
Non-operating pension and other post-employment benefit costs			(9)				(12)				(12)				(12)				(33)				(38)
Interest income and other			12				18				24				9				54				9
Interest expense, net of capitalized interest			(66)				(70)				(72)				(67)				(208)				(204)
Loss on debt extinguishment			—				—				—				—				—				(276)
Earnings before income taxes			173				255				293				387				721				2,339
Income taxes			(22)				(25)				(54)				(77)				(101)				(470)
Net earnings		$	151			$	230			$	239			$	310			$	620			$	1,869
Per Share Information
		Q1				Q2				Q3								Year-to-Date
		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Earnings per share, basic and diluted		$	0.21			$	0.31			$	0.33			$	0.42			$	0.85			$	2.51
Dividends paid per common share		$	1.09			$	0.19			$	0.19			$	0.18			$	1.47			$	1.99
Weighted average shares outstanding (in thousands):
Basic			733,163				732,021				731,046				740,058				732,069				743,990
Diluted			733,546				732,362				731,742				740,975				732,542				745,081
Common shares outstanding at end of period (in thousands)			732,507				730,850				730,128				737,547				730,128				737,547
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization (Adjusted EBITDA)
		Q1				Q2				Q3								Year-to-Date
in millions		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Net earnings		$	151			$	230			$	239			$	310			$	620			$	1,869
Non-operating pension and other post-employment benefit costs			9				12				12				12				33				38
Interest income and other			(12)				(18)				(24)				(9)				(54)				(9)
Interest expense, net of capitalized interest			66				70				72				67				208				204
Loss on debt extinguishment			—				—				—				—				—				276
Income taxes			22				25				54				77				101				470
Operating income			236				319				353				457				908				2,848
Depreciation, depletion and amortization			126				126				122				119				374				360
Basis of real estate sold			33				13				34				7				80				77
Special items included in operating income			—				11				—				—				11				—
Adjusted EBITDA(1)		$	395			$	469			$	509			$	583			$	1,373			$	3,285

(1)

Adjusted EBITDA is a non-GAAP measure that management uses to evaluate the performance of the company. Adjusted EBITDA, as we define it, is operating income adjusted for depreciation, depletion, amortization, basis of real estate sold and special items. Our definition of Adjusted EBITDA may be different from similarly titled measures reported by other companies. Adjusted EBITDA should not be considered in isolation from, and is not intended to represent an alternative to, our GAAP results.

 

 

 

Weyerhaeuser Company																		Total Company Statistics
Q3.2023 Analyst Package
Preliminary results (unaudited)
Special Items Included in Net Earnings (Income Tax Affected)
		Q1				Q2				Q3								Year-to-Date
in millions		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Net earnings		$	151			$	230			$	239			$	310			$	620			$	1,869
Loss on debt extinguishment(1)			—				—				—				—				—				207
Environmental remediation charge			—				8				—				—				8				—
Net earnings before special items(2)		$	151			$	238			$	239			$	310			$	628			$	2,076
		Q1				Q2				Q3								Year-to-Date
		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Net earnings per diluted share		$	0.21			$	0.31			$	0.33			$	0.42			$	0.85			$	2.51
Loss on debt extinguishment(1)			—				—				—				—				—				0.28
Environmental remediation charge			—				0.01				—				—				0.01				—
Net earnings per diluted share before special items(2)		$	0.21			$	0.32			$	0.33			$	0.42			$	0.86			$	2.79
(1) We recorded a total pretax loss on debt extinguishment of $276 million ($207 million after-tax) in first quarter 2022.
(2) Net earnings before special items is a non-GAAP measure that management believes provides helpful context in understanding the company's      earnings performance. Net earnings before special items should not be considered in isolation from, and is not intended to represent an     alternative to, our GAAP results.
Selected Total Company Items
		Q1				Q2				Q3								Year-to-Date
in millions		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Pension and post-employment costs:
Pension and post-employment service costs		$	6			$	5			$	6			$	9			$	17			$	27
Non-operating pension and other post-employment benefit costs			9				12				12				12				33				38
Total company pension and post-employment costs		$	15			$	17			$	18			$	21			$	50			$	65

 

 

 

Weyerhaeuser Company
Q3.2023 Analyst Package
Preliminary results (unaudited)
Condensed Consolidated Balance Sheet
in millions		March 31,2023				June 30,2023				September 30,2023				December 31,2022
ASSETS
Current assets:
Cash and cash equivalents		$	797			$	1,095			$	1,173			$	1,581
Short-term investments			—				665				668				—
Receivables, net			440				462				443				357
Receivables for taxes			28				18				18				42
Inventories			586				539				528				550
Prepaid expenses and other current assets			202				188				186				216
Total current assets			2,053				2,967				3,016				2,746
Property and equipment, net			2,157				2,133				2,106				2,171
Construction in progress			222				260				311				222
Timber and timberlands at cost, less depletion			11,564				11,512				11,521				11,604
Minerals and mineral rights, less depletion			211				207				203				214
Deferred tax assets			8				8				8				8
Other assets			365				383				385				375
Total assets		$	16,580			$	17,470			$	17,550			$	17,340
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt		$	981			$	980			$	861			$	982
Accounts payable			266				254				288				247
Accrued liabilities			403				473				537				511
Total current liabilities			1,650				1,707				1,686				1,740
Long-term debt, net			4,072				4,817				4,818				4,071
Deferred tax liabilities			101				105				113				96
Deferred pension and other post-employment benefits			346				348				349				344
Other liabilities			335				352				356				340
Total liabilities			6,504				7,329				7,322				6,591
Total equity			10,076				10,141				10,228				10,749
Total liabilities and equity		$	16,580			$	17,470			$	17,550			$	17,340

 

 

 

Weyerhaeuser Company
Q3.2023 Analyst Package
Preliminary results (unaudited)
Consolidated Statement of Cash Flows
		Q1				Q2				Q3								Year-to-Date
in millions		March 31, 2023				June 30, 2023				Sept 30,2023				Sept 30,2022				Sept 30,2023				Sept 30,2022
Cash flows from operations:
Net earnings		$	151			$	230			$	239			$	310			$	620			$	1,869
Noncash charges (credits) to earnings:
Depreciation, depletion and amortization			126				126				122				119				374				360
Basis of real estate sold			33				13				34				7				80				77
Pension and other post-employment benefits			15				17				18				21				50				65
Share-based compensation expense			8				9				9				8				26				25
Loss on debt extinguishment			—				—				—				—				—				276
Other			3				(1)				(6)				3				(4)				17
Change in:
Receivables, net			(83)				(22)				28				121				(77)				81
Receivables and payables for taxes			14				13				24				(12)				51				15
Inventories			(36)				50				9				28				23				(30)
Prepaid expenses and other current assets			(9)				17				(13)				(4)				(5)				(7)
Accounts payable and accrued liabilities			(87)				57				73				(8)				43				(23)
Pension and post-employment benefit contributions and payments			(6)				(5)				(5)				(5)				(16)				(19)
Other			(3)				(8)				(9)				(26)				(20)				(41)
Net cash from operations		$	126			$	496			$	523			$	562			$	1,145			$	2,665
Cash flows from investing activities:
Capital expenditures for property and equipment		$	(50)			$	(69)			$	(90)			$	(86)			$	(209)			$	(207)
Capital expenditures for timberlands reforestation			(21)				(12)				(9)				(8)				(42)				(38)
Acquisition of timberlands			—				(2)				(68)				(3)				(70)				(286)
Purchase of short-term investments			—				(664)				—				—				(664)				—
Other			2				(2)				3				—				3				1
Net cash from investing activities		$	(69)			$	(749)			$	(164)			$	(97)			$	(982)			$	(530)
Cash flows from financing activities:
Cash dividends on common shares		$	(799)			$	(139)			$	(138)			$	(133)			$	(1,076)			$	(1,485)
Net proceeds from issuance of long-term debt			—				743				—				—				743				881
Payments on long-term debt			—				—				(118)				—				(118)				(1,203)
Repurchases of common shares			(34)				(51)				(24)				(143)				(109)				(402)
Other			(8)				(2)				(1)				—				(11)				(5)
Net cash from financing activities		$	(841)			$	551			$	(281)			$	(276)			$	(571)			$	(2,214)
Net change in cash, cash equivalents and restricted cash		$	(784)			$	298			$	78			$	189			$	(408)			$	(79)
Cash, cash equivalents and restricted cash at beginning of period			1,581				797				1,095				1,731				1,581				1,999
Cash, cash equivalents and restricted cash at end of period		$	797			$	1,095			$	1,173			$	1,920			$	1,173			$	1,920
Cash paid during the period for:
Interest, net of amounts capitalized		$	57			$	70			$	63			$	62			$	190			$	211
Income taxes, net of refunds		$	6			$	12			$	22			$	92			$	40			$	446

 

 

 

Weyerhaeuser Company																		Timberlands Segment
Q3.2023 Analyst Package
Preliminary results (unaudited)
Segment Statement of Operations
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Sales to unaffiliated customers		$	462			$	417			$	380			$	441			$	1,259			$	1,421
Intersegment sales			142				150				141				133				433				450
Total net sales			604				567				521				574				1,692				1,871
Costs of sales			461				439				417				442				1,317				1,360
Gross margin			143				128				104				132				375				511
Selling expenses			—				—				1				1				1				1
General and administrative expenses			25				24				25				25				74				73
Other operating income, net			(2)				—				—				(1)				(2)				(5)
Operating income and Net contribution to earnings		$	120			$	104			$	78			$	107			$	302			$	442
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization(1)
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Operating income		$	120			$	104			$	78			$	107			$	302			$	442
Depreciation, depletion and amortization			68				68				65				61				201				192
Adjusted EBITDA(1)		$	188			$	172			$	143			$	168			$	503			$	634
(1)  See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.
Selected Segment Items
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Total (increase) decrease in working capital(2)		$	(24)			$	51			$	23			$	14			$	50			$	37
Cash spent for capital expenditures(3)		$	(26)			$	(22)			$	(26)			$	(22)			$	(74)			$	(75)

(2)  Represents the change in prepaid assets, accounts receivable, accounts payable, accrued liabilities and log inventory for the Timberlands and Real Estate & ENR segments combined.

(3)  Does not include cash spent for the acquisition of timberlands.

Segment Statistics(4)
			Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Third Party		Delivered logs:
Net Sales		West	$	229			$	206			$	176			$	224			$	611			$	791
(millions)		South		168				162				155				166				485				480
		North		17				7				11				15				35				40
		Total delivered logs		414				375				342				405				1,131				1,311
		Stumpage and pay-as-cut timber		16				15				12				10				43				30
		Recreational and other lease revenue		18				17				19				18				54				51
		Other revenue		14				10				7				8				31				29
		Total	$	462			$	417			$	380			$	441			$	1,259			$	1,421
Delivered Logs		West	$	137.10			$	123.45			$	119.19			$	158.59			$	126.89			$	164.97
Third Party Sales		South	$	38.23			$	37.49			$	36.92			$	38.59			$	37.56			$	38.08
Realizations (per ton)		North	$	81.71			$	78.69			$	73.81			$	83.84			$	78.46			$	79.26
Delivered Logs		West		1,674				1,661				1,479				1,411				4,814				4,793
Third Party Sales		South		4,386				4,341				4,180				4,310				12,907				12,612
Volumes (tons, thousands)		North		204				98				148				177				450				505
Fee Harvest Volumes		West		2,245				2,292				2,137				1,760				6,674				6,085
(tons, thousands)		South		6,432				6,430				6,146				6,112				19,008				18,113
		North		285				175				223				245				683				703

(4)  Western logs are primarily transacted in MBF but are converted to ton equivalents for external reporting purposes.

 

Weyerhaeuser Company                Real Estate, Energy & Natural Resources Segment
Q3.2023 Analyst Package
Preliminary results (unaudited)
Segment Statement of Operations
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Net sales		$	101			$	80			$	105			$	68			$	286			$	313
Costs of sales			41				21				43				14				105				100
Gross margin			60				59				62				54				181				213
General and administrative expenses			7				7				6				6				20				19
Operating income and Net contribution to earnings		$	53			$	52			$	56			$	48			$	161			$	194
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization(1)
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Operating income		$	53			$	52			$	56			$	48			$	161			$	194
Depreciation, depletion and amortization			3				5				4				5				12				12
Basis of real estate sold			33				13				34				7				80				77
Adjusted EBITDA(1)		$	89			$	70			$	94			$	60			$	253			$	283

(1)  See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

Selected Segment Items

in millions

Q1.2023

Q2.2023

Q3.2023

Q3.2022

YTD.2023

YTD.2022

Cash spent for capital expenditures

$

—

$

—

$

—

$

—

$

—

$

—

Segment Statistics

			Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Net Sales	Real Estate		$	72			$	47			$	79			$	30			$	198			$	217
(millions)	Energy and Natural Resources			29				33				26				38				88				96
	Total		$	101			$	80			$	105			$	68			$	286			$	313
Acres Sold	Real Estate			20,753				9,281				25,721				5,014				55,755				56,046
Price per Acre	Real Estate		$	3,241			$	4,790			$	3,033			$	5,046			$	3,403			$	3,624
Basis as a Percent of Real Estate Net Sales	Real Estate			46	%			28	%			43	%			23	%			40	%			35	%

Weyerhaeuser Company	Wood Products Segment
Q3.2023 Analyst Package
Preliminary results (unaudited)

Segment Statement of Operations
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Net sales		$	1,318			$	1,500			$	1,537			$	1,767			$	4,355			$	6,627
Costs of sales			1,159				1,218				1,195				1,360				3,572				4,050
Gross margin			159				282				342				407				783				2,577
Selling expenses			22				21				20				22				63				64
General and administrative expenses			36				37				38				36				111				106
Other operating costs, net			6				6				7				5				19				18
Operating income and Net contribution to earnings		$	95			$	218			$	277			$	344			$	590			$	2,389
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization(1)
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Operating income		$	95			$	218			$	277			$	344			$	590			$	2,389
Depreciation, depletion and amortization			53				52				51				51				156				151
Adjusted EBITDA(1)		$	148			$	270			$	328			$	395			$	746			$	2,540
(1)  See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.
Selected Segment Items
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Total (increase) decrease in working capital(2)		$	(127)			$	40			$	52			$	136			$	(35)			$	(30)
Cash spent for capital expenditures		$	(43)			$	(56)			$	(69)			$	(68)			$	(168)			$	(163)
(2)  Represents the change in prepaid assets, accounts receivable, accounts payable, accrued liabilities and inventory for the Wood Products segment.

Segment Statistics
in millions, except for third party sales realizations			Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Structural Lumber	Third party net sales		$	515			$	573			$	570			$	676			$	1,658			$	2,880
(volumes presented	Third party sales realizations		$	450			$	479			$	481			$	556			$	470			$	786
in board feet)	Third party sales volumes(3)			1,144				1,196				1,184				1,216				3,524				3,662
	Production volumes			1,143				1,164				1,174				1,140				3,481				3,575
Oriented Strand	Third party net sales		$	208			$	215			$	284			$	287			$	707			$	1,348
Board	Third party sales realizations		$	269			$	299			$	416			$	401			$	325			$	622
(volumes presented	Third party sales volumes(3)			773				720				683				715				2,176				2,167
in square feet 3/8")	Production volumes			761				727				724				735				2,212				2,232
Engineered Solid	Third party net sales		$	169			$	215			$	216			$	233			$	600			$	676
Section	Third party sales realizations		$	3,643			$	3,571			$	3,458			$	3,946			$	3,549			$	3,754
(volumes presented	Third party sales volumes(3)			4.7				6.0				6.2				5.9				16.9				18.0
in cubic feet)	Production volumes			4.6				5.9				5.6				6.0				16.1				18.1
Engineered	Third party net sales		$	87			$	126			$	122			$	166			$	335			$	471
I-joists	Third party sales realizations		$	3,171			$	2,901			$	2,862			$	3,525			$	2,951			$	3,312
(volumes presented	Third party sales volumes(3)			27				44				42				47				113				142
in lineal feet)	Production volumes			25				38				42				47				105				141
Softwood Plywood	Third party net sales		$	41			$	44			$	42			$	47			$	127			$	158
(volumes presented	Third party sales realizations		$	490			$	474			$	488			$	632			$	484			$	720
in square feet 3/8")	Third party sales volumes(3)			83				94				86				74				263				219
	Production volumes			74				84				77				64				235				197
Medium Density	Third party net sales		$	38			$	42			$	40			$	50			$	120			$	151
Fiberboard	Third party sales realizations		$	1,314			$	1,342			$	1,242			$	1,274			$	1,298			$	1,173
(volumes presented	Third party sales volumes(3)			29				31				33				40				93				129
in square feet 3/4")	Production volumes			34				33				34				38				101				130

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

 

 

 

Weyerhaeuser Company                                                                                                                                                                Unallocated Items

Q3.2023 Analyst Package

Preliminary results (unaudited)

Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as share-based compensation, pension and post-employment costs, elimination of intersegment profit in inventory and LIFO, foreign exchange transaction gains and losses and interest income and other.

Net Charge to Earnings
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Unallocated corporate function and variable compensation expense		$	(27)			$	(32)			$	(33)			$	(36)			$	(92)			$	(103)
Liability classified share-based compensation			—				(2)				2				2				—				5
Foreign exchange (loss) gain			(1)				2				—				9				1				12
Elimination of intersegment profit in inventory and LIFO			9				3				(4)				2				8				(39)
Other, net			(13)				(26)				(23)				(19)				(62)				(52)
Operating loss			(32)				(55)				(58)				(42)				(145)				(177)
Non-operating pension and other post-employment benefit costs			(9)				(12)				(12)				(12)				(33)				(38)
Interest income and other			12				18				24				9				54				9
Net charge to earnings		$	(29)			$	(49)			$	(46)			$	(45)			$	(124)			$	(206)
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization(1)
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Operating loss		$	(32)			$	(55)			$	(58)			$	(42)			$	(145)			$	(177)
Depreciation, depletion and amortization			2				1				2				2				5				5
Special items			—				11				—				—				11				—
Adjusted EBITDA(1)		$	(30)			$	(43)			$	(56)			$	(40)			$	(129)			$	(172)
(1)  See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.
Unallocated Special Items Included in Net Charge to Earnings (Pretax)
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Environmental remediation charge		$	—			$	11			$	—			$	—			$	11			$	—
Special items included in operating loss and net charge to earnings		$	—			$	11			$	—			$	—			$	11			$	—
Unallocated Selected Items
in millions		Q1.2023				Q2.2023				Q3.2023				Q3.2022				YTD.2023				YTD.2022
Cash spent for capital expenditures		$	(2)			$	(3)			$	(4)			$	(4)			$	(9)			$	(7)

 

For more information contact:

Analysts – Andy Taylor (206) 539-3907

Media – Nancy Thompson (919) 861-0342

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SOURCE Weyerhaeuser Company

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