Published on : Tuesday, July 30, 2013
Plum Creek Timber Company, Inc. announced second quarter earnings of $46 million, or $0.28 per diluted share, on revenues of $303 million. Earnings for the second quarter of 2012 were $36 million, or $0.22 per diluted share, on revenues of $294 million.
Earnings for the first six months of 2013 improved $37 million compared to the same period of 2012. Earnings were $102 million, or $0.62 per diluted share, on revenues of $643 million. Earnings for the first six months of 2012 were $65 million, or $0.40 per diluted share, on revenues of $631 million.
Adjusted EBITDA, a non-GAAP measure of operating performance, for the first six months of 2013 was $232 million, similar to the $234 million in the same period of 2012. Plum Creek Timber ended the quarter with $355 million in cash and cash equivalents. A reconciliation of adjusted EBITDA to net income and cash flow from operations is provided as an attachment to this release.
“Each of our business segments performed well during the second quarter,” said Rick Holley, chief executive officer. “We are experiencing fundamental demand improvement and better pricing; although, we remain in the very early stages of the housing recovery. As the industry adjusts to this change in the demand environment, regional markets we serve are recovering at different rates. This is when our unmatched, geographic diversity gives us tremendous operating flexibility. It allows us to act and capitalize on strong local markets, growing earnings and cash flow while maximizing the long-term value of our asset base.”
The Northern Resources segment reported operating profit of $8 million during the second quarter, an increase of $4 million compared to the second quarter of 2012. Average sawlog prices increased $8 per ton, or 11 percent, compared to second quarter 2012 levels on improved demand from both domestic and export customers. Pulpwood prices were similar to the prices realized during the second quarter of 2012. As planned, total Northern segment volumes decreased approximately 160,000 tons, or 17 percent, from the second quarter harvest of 2012. Most of the reduction in harvest volume consisted of lower-margin pulpwood.
Operating profit in the Southern Resources segment was $23 million, up $1 million from the $22 million reported for second quarter of 2012. Higher prices for both sawlogs and pulpwood offset lower harvest volumes. Sawlog prices increased $1 per ton, or 5 percent, and pulpwood prices increased $1 per ton, or 10 percent, compared to the second quarter of 2012. Overall the Southern harvest declined about 500,000 tons, or 14 percent, compared to the second quarter of 2012. While our full-year 2013 Southern harvest is planned to be similar to 2012’s harvest level, the 2013 harvest is weighted to the second half of the year to capture the expected improvement in log prices.
The Manufacturing segment reported operating income of $14 million, a $5 million improvement over the second quarter of 2012. Strong demand and pricing continued to benefit each of the company’s manufactured product lines. Plywood prices increased 13 percent compared to the second quarter of 2012 on strong industrial demand. Plywood sales volume declined 6 percent compared to the same period of 2012 due to reduced log availability. MDF prices were up 8 percent compared to second quarter 2012 while sales volume grew 15 percent. In April of this year, the company re-opened its Evergreen lumber mill, boosting lumber sales volume by 21 percent compared to the second quarter of 2012. Average lumber prices declined approximately one percent as the product mix shifted to include lower-priced stud lumber from the re-opened mill.
Tags: business segments, cash and cash equivalents, cash flow, chief executive officer, deman, diluted share, ebitda, fundamental demand, geographic diversity, local markets, net income, operating profit, plum creek timber, plum creek timber company, regional markets