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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 28, 1997 or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to ________
Commission File Number 1-4825
WEYERHAEUSER COMPANY
A Washington Corporation (IRS Employer Identification
No. 91-0470860)
Tacoma, Washington 98477
Telephone (253) 924-2345
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange on
Title of Each Class Which Registered
- ------------------------------- --------------------------
Common Shares ($1.25 par value) Chicago Stock Exchange
New York Stock Exchange
Pacific Stock Exchange
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days. Yes
_X_ No___.
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or
any amendment to this Form 10-K. [ ].
As of February 27, 1998, 198,568,139 shares of the registrant's common
stock ($1.25 par value) were outstanding and the aggregate market
value of the registrant's voting shares held by non-affiliates was
approximately $9,915,996,441.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Report to Shareholders for the fiscal year
ended December 28, 1997 are incorporated by reference into Parts I, II and
IV.
Portions of the Notice of 1998 Annual Meeting of Shareholders and
Proxy Statement are incorporated by reference into Part III.
Weyerhaeuser Company and Subsidiaries
TABLE OF CONTENTS
PART I Page
----
Item 1. Business 3
Item 2. Properties 7
Item 3. Legal Proceedings 10
Item 4. Submission of Matters to a Vote of Security Holders 12
PART II
Item 5. Market Price of and Dividends on the Registrant's
Common Equity and Related Stockholder Matters 13
Item 6. Selected Financial Data 13
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 13
Item 8. Financial Statements and Supplementary Information 13
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 13
PART III
Item 10. Directors and Executive Officers of the Registrant 14
Item 11. Executive Compensation 14
Item 12. Security Ownership of Certain Beneficial Owners
and Management 14
Item 13. Certain Relationships and Related Transactions 14
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports
on Form 8-K 15
Signatures 16
Report of Independent Public Accountants on Financial
Statement Schedules 17
Schedule II Valuation and Qualifying Accounts 18
2
Weyerhaeuser Company and Subsidiaries
PART I
Item 1. Business
- -----------------
Weyerhaeuser Company (the company) was incorporated in the state of
Washington in January 1900 as Weyerhaeuser Timber Company. It is
principally engaged in the growing and harvesting of timber and the
manufacture, distribution and sale of forest products, real estate
development and construction, and other real estate related
activities. Its business segments are timberlands and wood products;
pulp, paper and packaging; and real estate and related assets.
Information with respect to the description and general development of the
company's business, included on pages 30 through 34, Description of the
Business of the Company, contained in the company's 1997 Annual Report to
Shareholders, is incorporated herein by reference.
Financial information with respect to industry segments, included in Note
19 of Notes to Financial Statements contained in the company's 1997
Annual Report to Shareholders, is incorporated herein by reference.
Timberlands and Wood Products
The company is engaged in the management of 5.2 million acres of
company-owned and .2 million acres of leased commercial forestland in the
United States (60% in the South and 40% in the Pacific Northwest), most of
it highly productive and located extremely well to serve both domestic and
international markets. The company has, additionally, long-term license
arrangements in Canada covering approximately 23.7 million acres (of
which 16.5 million acres are considered to be productive forestland). The
combined total timber inventory on these U.S. and Canadian lands is
approximately 273 million cunits (a cunit is 100 cubic feet of solid
wood), of which approximately 75% is softwood species. The relationship
between cubic measurement and the quantity of end products that may be
produced from timber varies according to the species, size and quality
of timber, and will change through time as the mix of these variables
changes. To sustain the timber supply from its fee timberlands, the
company is engaged in extensive planting, suppression of
nonmerchantable species, precommercial and commercial thinning,
fertilization and operational pruning, all of which increase the yield
from its fee timberland acreage.
Inventory Thousands of Acres at December 28, 1997
--------- -------------------------------------------
Millions Fee Long-term License
of Cunits Ownership Leases Arrangements Total
--------- --------- --------- ------------ -------
Geographic Area
United States
West 57 2,048 -- -- 2,048
South 36 3,123 237 -- 3,360
--------- --------- --------- ------------ -------
Total United States 93 5,171 237 -- 5,408
--------- --------- --------- ------------ -------
Canada
Alberta 91 -- -- 7,453 7,453
British Columbia 10 38 -- 3,800 3,838
Saskatchewan 79 -- -- 12,462 12,462
--------- --------- --------- ------------ -------
Total Canada 180 38 -- 23,715 23,753
--------- --------- --------- ------------ -------
TOTAL 273 5,209 237 23,715 29,161
========= ========= ========= ============ =======
Thousands of Acres
Thousands of Acres Millions of -----------------------
------------------ Seedlings Stocking
Harvested Planted Planted Control Fertilization
--------- ------- ----------- --------- -------------
1997 Activity
West 35.6 32.3 17.2 5.3 73.2
South 55.2 55.4 31.2 -- 200.0
--------- ------- ----------- --------- -------------
Total United States 90.8 87.7 48.4 5.3 273.2
========= ======= =========== ========= =============
3
Weyerhaeuser Company and Subsidiaries
PART I
Item 1. Business - Continued
- -----------------------------
The company's wood products businesses produce and sell softwood
lumber, plywood and veneer; composite panels; oriented strand board;
hardwood lumber and plywood; doors; treated products; logs; chips and
timber. These products are sold primarily through the company's own
sales organizations. Building materials are sold to wholesalers,
retailers and industrial users.
Sales volumes by major product class are as follows (millions):
1997 1996 1995 1994 1993
------ ------ ------ ------ ------
Raw materials - cubic ft. 584 577 535 564 547
Softwood lumber - board ft. 4,869 4,745 4,515 4,402 4,230
Softwood plywood and veneer -
sq. ft. (3/8") 2,042 2,172 2,324 2,685 2,435
Composite panels - sq. ft. (3/4") 551 604 648 660 626
Oriented strand board -
sq. ft. (3/8") 2,462 2,083 1,931 1,803 1,672
Hardboard - sq. ft. (7/16") -- 193 201 167 140
Hardwood lumber - board ft. 362 349 293 254 240
Engineered wood products - lineal ft. 137 116 128 71 47
Hardwood doors (thousands) 730 652 648 617 556
Selected product prices:
1997 1996 1995 1994 1993
------ ------ ------ ------ ------
Export logs (#2 sawlog-bark on) -$/MBF
Cascade - Douglas fir $1,065 $1,330 $1,365 $1,168 $1,224
Coastal - Hemlock 628 611 750 804 831
Coastal - Douglas fir 981 1,246 1,217 1,085 1,104
Lumber (common) - $/MBF
2x4 Douglas fir (kiln dried) 418 422 332 408 418
2x4 Douglas fir (green) 381 386 308 364 383
2x4 Southern yellow pine
(kiln dried) 453 422 364 419 397
2x4 Spruce-pine-fir (kiln dried) 354 351 251 343 334
Plywood (1/2" CDX) - $/MSF
West 312 307 331 334 321
South 261 256 301 298 282
Oriented strand board (7/16"-24/16)
North Central price - $/MSF 142 184 245 265 236
4
Weyerhaeuser Company and Subsidiaries
PART I
Item 1. Business - Continued
- -----------------------------
Pulp, Paper and Packaging
The company's pulp, paper and packaging businesses include: Pulp,
which manufactures chemical wood pulp for world markets; Newsprint,
which manufactures newsprint at the company's North Pacific Paper
Corporation mill and markets it to West Coast and Japanese newspaper
publishers; Paper, which manufactures and markets a range of both
coated and uncoated fine papers through paper merchants and printers;
Containerboard Packaging, which manufactures linerboard and
corrugating medium, which is primarily used in the production of
corrugated packaging, and manufactures and markets industrial and
agricultural packaging; Paperboard, which manufactures and markets
bleached paperboard, used for production of liquid containers, to West
Coast and Pacific Rim customers; Recycling, which operates an
extensive wastepaper collection system and markets it to company mills and
worldwide customers; and Chemicals, which produces chlorine, caustic
and tall oil, which are used principally by the company's pulp, paper
and packaging operations.
Sales volumes by major product class are as follows (thousands):
1997 1996 1995 1994 1993
------ ------ ------ ------ ------
Pulp - air-dry metric tons 1,982 1,868 2,060 2,068 1,886
Newsprint - metric tons 684 629 663 638 609
Paper - tons 1,146 1,007 1,006 998 990
Paperboard - tons 243 205 230 201 222
Containerboard - tons 389 346 259 254 290
Packaging - MSF 44,508 42,323 34,342 34,483 31,386
Recycling - tons 2,229 2,011 1,467 985 851
Selected product prices (per ton):
1997 1996 1995 1994 1993
------ ------ ------ ------ ------
Pulp - NBKP-air-dry metric-U.S. $ 566 $ 579 $ 883 $ 566 $ 445
Newsprint - metric-West Coast U.S. 550 636 662 460 435
Paper - uncoated free sheet-U.S. 740 745 946 617 627
Linerboard - 42 lb.-Eastern U.S. 326 367 505 367 295
Recycling - old corrugated containers 76 53 128 78 27
Recycling - old newsprint 15 18 99 46 16
5
Weyerhaeuser Company and Subsidiaries
PART I
Item 1. Business - Continued
- -----------------------------
Real Estate and Related Assets
The company's real estate and related assets businesses are
principally engaged in real estate development and construction
through the company's real estate subsidiary, Weyerhaeuser Real Estate
Company, and in other real estate related activities through the
company's financial services subsidiary, Weyerhaeuser Financial
Services, Inc. Development and construction consists of developing
single-family housing and residential lots for sale, including the
development of master-planned communities.
In May 1997, the company's wholly owned subsidiary, Weyerhaeuser
Mortgage Company (WMC), was sold. WMC was the principal business
within the financial services segment. GNA Corporation, a subsidiary that
specialized in the sale of life insurance annuities and mutual funds to
the customers of financial institutions, was sold in April 1993.
With the sale of WMC, the financial services segment is no longer
material to the results of the company. Beginning with the third
quarter, the remaining real estate activities in financial services have
been combined with real estate into one segment entitled real estate and
related assets.
Volume information:
1997 1996 1995 1994 1993
------ ------ ------ ------ ------
Units sold:
Single-family units (1) 2,914 2,773 3,114 3,934 3,879
Multi-family units (1) 324 234 117 475 1,141
Lots (1) 1,988 2,522 1,628 2,157 1,372
Commercial space
(thousand sq. ft.) 615 569 -- 389 88
Amounts in millions
Loan servicing portfolio $ -- $4,354 $10,952 $11,300 $8,400
Single-family loan originations $1,168 $3,436 $ 2,196 $ 2,763 $4,405
(1) Includes one-half of joint venture sales.
6
Weyerhaeuser Company and Subsidiaries
PART I
Item 2. Properties
- -------------------
Timberlands and Wood Products
Facilities and annual production are summarized by major product class as
follows (millions):
Number
Production of
Capacity Facilities 1997 1996 1995 1994 1993
---------- ---------- ----- ----- ----- ----- -----
Logs - cubic ft. -- -- 995 912 914 671 673
Softwood lumber -
board ft. 3,790 27 3,992 3,701 3,419 3,249 3,135
Softwood plywood
and veneer -
sq. ft. (3/8") 1,008 5 1,092 1,243 1,292 1,249 1,188
Composite panels -
sq. ft. (3/4") 600 5 478 535 583 594 564
Oriented strand
board - sq. ft.
(3/8") 2,195 6 2,041 1,687 1,654 1,568 1,443
Hardboard - sq. ft.
(7/16") -- -- -- 86 124 122 120
Hardwood lumber -
board ft. 413 12 345 333 278 229 221
Hardwood doors
(thousands) 850 1 740 646 643 597 522
Principal manufacturing facilities are located as follows:
Softwood lumber and plywood Hardwood lumber
Alabama, Arkansas, Georgia, Arkansas, Michigan, Oklahoma,
Louisiana, Mississippi, Oregon, Pennsylvania,
North Carolina, Oklahoma, Oregon, Washington and Wisconsin
Washington and Alberta,
British Columbia and Hardwood doors
Saskatchewan, Canada Wisconsin
Composite panels
Georgia, North Carolina, Oregon
and Wisconsin
Oriented strand board
Michigan, North Carolina,
West Virginia and Alberta, Canada
7
Weyerhaeuser Company and Subsidiaries
PART I
Item 2. Properties - Continued
- -------------------------------
Pulp, Paper and Packaging
Facilities and annual production are summarized by major product class as
follows (thousands):
Number
Production of
Capacity Facilities 1997 1996 1995 1994 1993
---------- ---------- ------ ------ ------ ------ ------
Pulp - air-dry
metric tons 2,180 8 2,063 2,004 2,159 2,041 2,096
Newsprint - metric
tons 715 1 704 631 687 651 618
Paper - tons 1,126 5 1,128 1,034 1,060 982 1,007
Paperboard - tons 230 1 231 206 229 189 217
Containerboard -
tons 2,480 4 2,381 2,331 2,329 2,357 2,269
Packaging - MSF 50,000 46 46,488 44,471 36,041 36,020 32,795
Recycling - tons -- 28 3,655 3,428 2,754 2,042 1,847
Principal manufacturing facilities are located as follows:
Pulp Containerboard
Georgia, Mississippi, North North Carolina, Oklahoma and Oregon
Carolina, Washington and Alberta,
British Columbia and Packaging
Saskatchewan, Canada Arizona, California, Colorado,
Connecticut, Florida, Georgia,
Newsprint Hawaii, Illinois, Indiana, Iowa,
Washington Kentucky, Maryland, Michigan,
Minnesota, Mississippi, Missouri,
Paper Nebraska, New Jersey, New York,
Mississippi, North Carolina, North Carolina, Ohio, Oregon,
Washington, Wisconsin and Tennessee, Texas, Virginia,
Saskatchewan, Canada Washington and Wisconsin
Paperboard Recycling
Washington Arizona, California, Colorado,
Georgia, Illinois, Iowa, Kansas,
Maryland, Minnesota, Nebraska,
North Carolina, Oklahoma, Oregon,
Tennessee, Texas, Utah, Virginia,
Washington and West Virginia
Chemicals
Georgia, Mississippi, North
Carolina, Oklahoma, Oregon and
Washington
8
Weyerhaeuser Company and Subsidiaries
PART I
Item 2. Properties - Continued
- -------------------------------
Real Estate and Related Assets
Single-family housing Commercial development
California, Maryland, Nevada, California, Florida, Maryland
Texas, Virginia and Washington and Washington
Residential land development Real estate investments
Arkansas, California, Florida, Arizona, California, Colorado,
Georgia, Maryland, Nevada, North Nevada, Oregon and Washington
Carolina, Texas, Virginia and
Washington
Mortgage securities
California
9
Weyerhaeuser Company and Subsidiaries
PART I
Item 3. Legal Proceedings
- --------------------------
Trial began in May 1992 in a federal income tax refund case that the
company filed in July 1989 in the United States Claims Court. The
complaint contended that the company overpaid federal income taxes in 1977
through 1983. The alleged overpayments resulted from the
disallowance of certain timber casualty losses and certain deductions
claimed by the company arising from export transactions. The refund
sought was approximately $29 million, plus statutory interest from the
dates of the alleged overpayments. The company settled the portion of the
case relating to export transactions and received a tax refund of
approximately $10 million, plus statutory interest. In September
1994, the United States Court of Federal Claims (successor to the
United States Claims Court) issued an opinion on the casualty loss
issues which resulted in the allowance of additional tax refunds of
approximately $2 million, plus statutory interest. Both the company and
the government appealed the decision. On August 2, 1996, the Court of
Appeals for the Federal Circuit issued its opinion on the remaining
timber casualty loss issues, ruling in favor of the company on both the
company's appeal and the government's appeal. The United States Supreme
Court denied the government's request for certiorari on January 21, 1997.
On October 23, 1997, the United States Court of Federal Claims entered a
judgment in favor of the company for refund of taxes in the amount of
$9 million plus statutory interest. The company has received a partial
refund of $7 million in tax plus statutory interest. The government
filed an appeal on the remaining $2 million tax refund plus statutory
interest, but such appeal was withdrawn in January 1998. The remaining
refund is being processed by the government.
On March 6, 1992, the company filed a complaint in the Superior Court for
King County, Washington, against a number of insurance companies. The
complaint sought a declaratory judgment that the insurance companies
were obligated to defend the company and to pay, on the company's
behalf, certain claims relating to alleged environmental damage from
toxic substances to sites owned by third parties and the company. The
company subsequently agreed to settlements with all but one of the
defendants. The remaining defendant provided first layer excess coverage
during a three year period. That defendant's liability on groups
of sites is being tried in three phases. Two trials against the
remaining defendant, affecting nine sites, began in October 1994 and
February 1996, respectively, and resulted in verdicts assigning 100
percent clean-up responsibility to the defendant on three sites,
partial responsibility on three others and a finding of no liability as to
the remaining three. With respect to the remaining sites, a voluntary
dismissal was taken on 6 sites, and on the final 10 sites the defendant's
offer of judgment was accepted in June 1997. Final judgment for $7.8
million on the sites covered by the two trials was received on December 19,
1997.
The company conducted a review of its 10 major pulp and paper
facilities to evaluate the facilities' compliance with federal
Prevention of Significant Deterioration (PSD) regulations. The
results of the reviews were disclosed to seven state agencies and the
Environmental Protection Agency (EPA) during 1994 and 1995. At the
Cosmopolis, Washington, Columbus, Mississippi, and Flint River,
Georgia, facilities, the state regulatory agencies agreed with the
company's conclusions regarding the status of each facility. For the
Cosmopolis facility, the Washington Department of Ecology agreed the
changes made at the facility did not require PSD review. For the
Columbus and Flint River facilities, the states concluded the original PSD
permits issued to the facilities require updating. The company will
update emissions data for the Columbus and Flint River facilities as part
of the Title V permitting process. No penalties were assessed for the
issues identified at Columbus and Flint River. Agreements resolving the
alleged PSD issues have been reached with the states of Washington,
Oklahoma and North Carolina, as noted below. No issues were identified
at the company's Rothschild, Wisconsin, facility. In April 1995, EPA
Region X issued a Notice of Violation (NOV) to the company and to North
Pacific Paper Corporation (NORPAC), a joint venture in which the
company currently has a 50 percent ownership interest. The NOV
addresses alleged PSD violations at NORPAC's Longview, Washington,
newsprint manufacturing facility. A settlement resolving alleged PSD
issues at the Longview/NORPAC complex was reached with the State of
Washington on January 26, 1996. On November 14, 1995, the company
entered into a settlement with the State of Oklahoma to resolve alleged
PSD violations at the company's Valliant, Oklahoma, containerboard
manufacturing facility. The company also entered into Special Orders by
Consent with the State of North Carolina to resolve alleged PSD issues at
the New Bern, North Carolina, pulp mill and the Plymouth, North
Carolina, pulp and paper complex. No decision has been made by the
Lane County Oregon Regional Air Pollution Control Authority concerning
alleged PSD and permit violations at the company's Springfield, Oregon,
containerboard manufacturing facility.
10
Weyerhaeuser Company and Subsidiaries
PART I
Item 3. Legal Proceedings - Continued
- --------------------------------------
The Washington Department of Ecology issued a $10 thousand penalty to the
company because of three accidental chlorine releases which occurred
at the company's pulp mill in Longview on March 18, 1996, which has been
paid. The EPA is also investigating.
The Washington Department of Ecology has issued a NOV and a $40
thousand penalty because of an accidental spill of an estimated
8,700 gallons of crude sulfate turpentine on January 27, 1997, at the
company's pulp and paper operations in Longview. The penalty was
paid. The EPA investigated the January incident. EPA and the company are
negotiating a possible settlement of an EPA enforcement action.
On June 20, 1996, the Wisconsin Department of Natural Resources (WDNR)
issued a NOV for alleged air violations at the Marshfield, Wisconsin, wood
products manufacturing facility. No penalty was assessed in the NOV. The
NOV was referred to the Wisconsin Department of Justice (WDOJ) for
enforcement action on July 2, 1996. The company settled with WDNR in
September 1997 and paid a $65 thousand penalty.
On October 2, 1996, the WDNR conducted an inspection of a building
demolition project at the company's Marshfield, Wisconsin facility. The
WDNR noted several potential non-compliance issues in the work performed
by the asbestos abatement subcontractor retained for the project. Upon
learning of the issues observed by WDNR, the company removed the asbestos
abatement subcontractor from the plantsite. The WDNR and EPA Region V
are reviewing the work performed to evaluate whether an enforcement
action should be brought against the asbestos abatement subcontractor, the
general contractor, and/or the company.
In November 1996, an action was filed against the company in Superior
Court for King County, Washington, on behalf of a purported class of all
individuals and entities that own property in the United States on which
exterior hardboard siding manufactured by the company has been installed
since 1980. The action alleges the company has manufactured and
distributed defective hardboard siding and has breached express
warranties and consumer protection statutes in its sale of hardboard
siding. The action seeks compensatory damages, including prejudgment
interest, and seeks damages for the cost of replacing siding that rots
subsequent to the entry of any judgment. In January 1997, an action was
filed, also in Superior Court for King County, Washington, on behalf
of a purported class of all individuals, proprietorships,
partnerships, corporations, and other business entities in the United
States on whose homes, condominiums, apartment complexes or commercial
buildings hardboard siding manufactured by the company has been
installed. The action alleges the company has breached express and
implied warranties in its sale of hardboard siding and also has
violated the Consumer Protection Act of the State of Washington. The
action seeks damages, prejudgment interest, costs and reasonable
attorney fees. In December 1997, the two cases were consolidated for the
purpose of discovery and resolution of the class certification issue.
Also, in December 1997, the plaintiffs in the first of the two cases filed
a motion to change the trial date and for leave to move for class
certification. In January 1998, the court denied this motion. This
case was settled for approximately $11 thousand and dismissed in March
1998. The second case is currently set for trial in May 1998 without class
certification. The company is a defendant in approximately eighteen other
hardboard siding cases, two of which purport to be class actions on behalf
of purchasers of single- or multi-family residences that contain the
company's hardboard siding, one in Nebraska and one in Iowa.
On August 7, 1997, the company entered a plea of guilty to a
misdemeanor violation of the Migratory Bird Treaty Act in the U.S.
District Court, Western District of Washington, at Tacoma. The
misdemeanor violation involved the accidental poisoning of a hawk and an
owl in the course of starling pest control at the company's
Longview, Washington, pulp mill. The company and the Department of
Justice agreed to a disposition of the misdemeanor which involved an
undertaking by the company to conduct a starling control research
project at its Longview mill.
In December 1997, the Oklahoma Department of Environmental Quality
issued a NOV for alleged failure to comply with audit requirements for a
bark boiler at the company's Valliant, Oklahoma, containerboard
manufacturing facility. No penalty was specified.
11
Weyerhaueser Company and Subsidiaries
PART I
Item 3. Legal Proceedings - Continued
- --------------------------------------
The company is also a party to various proceedings relating to the
clean-up of hazardous waste sites under the Comprehensive
Environmental Response Compensation and Liability Act, commonly known as
"Superfund," and similar state laws. The EPA and/or various state agencies
have notified the company that it may be a potentially responsible
party with respect to other hazardous waste sites as to which no
proceedings have been instituted against the company. The company is
also a party to other legal proceedings generally incidental to its
business. Although the final outcome of any legal proceeding is subject
to a great many variables and cannot be predicted with any degree of
certainty, the company presently believes that any ultimate outcome
resulting from the legal proceedings discussed herein, or all of them
combined, would not have a material effect on the company's current
financial position, liquidity or results of operations; however, in any
given future reporting period, such legal proceedings could have a
material effect on results of operations.
Item 4. Submission of Matters to a Vote of Security Holders
- ------------------------------------------------------------
There were no matters submitted to a vote of security holders during the
fourth quarter of the fiscal year ended December 28, 1997.
12
Weyerhaeuser Company and Subsidiaries
PART II
Item 5. Market Price of and Dividends on the Registrant's Common
- ----------------------------------------------------------------------
Equity and Related Stockholder Matters
- --------------------------------------
Information with respect to market information, stockholders and
dividends included in Notes 20 and 21 of Notes to Financial Statements in
the company's 1997 Annual Report to Shareholders, is incorporated herein
by reference.
Item 6. Selected Financial Data
- --------------------------------
Information with respect to selected financial data included in Note
21 of Notes to Financial Statements in the company's 1997 Annual Report to
Shareholders, is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
- --------------------------------------------------------------------------
Results of Operations
- ---------------------
Information with respect to Management's Discussion and Analysis
included on pages 1 and 18-40 contained in the company's 1997 Annual
Report to Shareholders, is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Information
- -----------------------------------------------------------
Financial statements and supplementary information, contained in the
company's 1997 Annual Report to Shareholders are incorporated herein by
reference:
Page(s) in
Annual Report
to
Shareholders
-------------
Report of Independent Public Accountants 40
Consolidated Statement of Earnings 41
Consolidated Balance Sheet 42, 43
Consolidated Statement of Cash Flows 44, 45
Consolidated Statement of Shareholders' Interest 46
Notes to Financial Statements 47-65
Selected Quarterly Financial Information (Unaudited) 63
Item 9. Changes in and Disagreements with Accountants on Accounting and
- --------------------------------------------------------------------------
Financial Disclosure
- --------------------
Not applicable.
13
Weyerhaeuser Company and Subsidiaries
PART III
Item 10. Directors and Executive Officers of the Registrant
- ------------------------------------------------------------
Information with respect to Directors of the company included on pages 1
through 4 of the Notice of 1998 Annual Meeting of Shareholders and
Proxy Statement dated March 9, 1998 is incorporated herein by
reference.
The executive officers of the company are as follows:
Name Title Age
- --------------------- ------------------------- ---
William R. Corbin Executive Vice President 56
Richard C. Gozon Executive Vice President 59
Steven R. Hill Senior Vice President 50
Mack L. Hogans Senior Vice President 49
Norman E. Johnson Senior Vice President 64
Thomas M. Luthy Senior Vice President 60
Steven R. Rogel President 55
William C. Stivers Senior Vice President 59
Item 11. Executive Compensation
- --------------------------------
Information with respect to executive compensation included on pages 5
through 16 of the Notice of 1998 Annual Meeting of Shareholders and
Proxy Statement dated March 9, 1998 is incorporated herein by
reference.
Item 12. Security Ownership of Certain Beneficial Owners and
- ----------------------------------------------------------------------
Management
- ----------
Information with respect to security ownership of certain beneficial
owners and management included on pages 5 and 6 of the Notice of 1998
Annual Meeting of Shareholders and Proxy Statement dated March 9, 1998 is
incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
- --------------------------------------------------------
Information with respect to certain relationships and related
transactions included on pages 20 and 21 of the Notice of 1998 Annual
Meeting of Shareholders and Proxy Statement dated March 9, 1998 is
incorporated herein by reference.
14
Weyerhaeuser Company and Subsidiaries
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
- --------------------------------------------------------------------------
Financial Statements
The consolidated financial statements of the company, together with the
report of independent public accountants, contained in the company's
1997 Annual Report to Shareholders, are incorporated in Part II, Item 8
of this Form 10-K by reference.
Page Number(s)
Financial Statement Schedules in Form 10-K
-------------
Report of Independent Public Accountants on Financial
Statement Schedules 17
Schedule II - Valuation and Qualifying Accounts 18
All other financial statement schedules have been omitted because they are
not applicable or the required information is included in the
consolidated financial statements, or the notes thereto, contained in the
company's 1997 Annual Report to Shareholders and incorporated herein by
reference.
Exhibits:
3 - (i) Articles of Incorporation
(ii) Bylaws
10 - Material Contracts
(a) Agreement with N. E. Johnson (incorporated by reference
to 1992 Form 10-K filed with the Securities and Exchange
Commission on March 12, 1993-Commission File Number
1-4825)
(b) Agreement with W. R. Corbin (incorporated by reference to
1992 Form 10-K filed with the Securities and Exchange
Commission on March 12, 1993-Commission File Number
1-4825)
(c) Agreement with R. C. Gozon (incorporated by reference to
1995 Form 10-K filed with the Securities and Exchange
Commission on March 15, 1996-Commission File Number
1-4825)
(d) Agreement with S. R. Rogel
11 - Statement Re: Computation of Per Share Earnings
(incorporated by reference to Note 2 of the 1997
Weyerhaeuser Company Annual Report to Shareholders)
13 - Portions of the 1997 Weyerhaeuser Company Annual
Report to Shareholders specifically incorporated by
reference herein
22 - Subsidiaries of the Registrant
23 - Consent of Independent Public Accountants
27 - Financial Data Schedules
Reports on Form 8-K
The registrant filed reports on Form 8-K dated January 22,
February 24, April 15, May 23, June 19, July 1, July 9, July 11, July
17, September 4, and October 15, 1997 and January 23, 1998,
respectively, reporting information under Item 5, Other Events.
15
Weyerhaeuser Company and Subsidiaries
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized on
March 13, 1998.
Weyerhaeuser Company
/s/ Steven R. Rogel
---------------------
Steven R. Rogel
President
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant in the capacities indicated on March 13, 1998.
/s/ Steven R. Rogel /s/ P. M. Hawley
- ------------------------------ ---------------------------
Steven R. Rogel Philip M. Hawley
President, Principal Executive Director
Officer and Director
/s/ Martha R. Ingram
---------------------------
/s/ George H. Weyerhaeuser Martha R. Ingram
- ------------------------------ Director
George H. Weyerhaeuser
Chairman of the Board and /s/ John Kieckhefer
Director ---------------------------
John I. Kieckhefer
/s/ William C. Stivers Director
- ------------------------------
William C. Stivers /s/Donald F. Mazankowski
Principal Financial Officer ---------------------------
Donald F. Mazankowski
/s/ Kenneth J. Stancato Director
- ------------------------------
Kenneth J. Stancato /s/ William D. Ruckelshaus
Principal Accounting Officer ---------------------------
William D. Ruckelshaus
/s/ John W. Creighton, Jr. Director
- ------------------------------
John W. Creighton, Jr. /s/ Richard H. Sinkfield
Director ----------------------------
Richard H. Sinkfield
/s/ W. John Driscoll Director
- ------------------------------
W. John Driscoll /s/ James N. Sullivan
Director ----------------------------
James N. Sullivan
Director
16
Weyerhaeuser Company and Subsidiaries
FINANCIAL STATEMENT SCHEDULES
Report of Independent Public Accountants on Financial Statement
Schedules
To Weyerhaeuser Company:
We have audited in accordance with generally accepted auditing
standards, the financial statements included in Weyerhaeuser
Company's annual report to shareholders incorporated by reference in this
Form 10-K, and have issued our report thereon dated February 11,
1998. Our audit was made for the purpose of forming an opinion on those
statements taken as a whole. The schedule listed on page 15 is the
responsibility of the company's management and is presented for purposes of
complying with the Securities and Exchange Commission's rules and is
not part of the basic financial statements. This schedule has
been subjected to the auditing procedures applied in the audit of the
basic financial statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth therein in
relation to the basic financial statements taken as a whole.
ARTHUR ANDERSEN LLP
Seattle, Washington,
February 11, 1998
17
Weyerhaeuser Company and Subsidiaries
FINANCIAL STATEMENT SCHEDULES
Schedule II - Valuation
and Qualifying Accounts
For the three years ended
December 28, 1997
Dollar amounts in millions
Deductions
Balance at from/ Balance at
Beginning Charged Additions (to) End of
Description of Period to Income Reserve Period
- ----------- ---------- --------- -------------- ----------
Weyerhaeuser
Reserve deducted from
related asset accounts:
Doubtful accounts -
Accounts receivable
1997 $ 7 $ 5 $ 6 $ 6
========== ========== ============= ==========
1996 $ 9 $ 4 $ 6 $ 7
========== ========== ============= ==========
1995 $ 10 $ 2 $ 3 $ 9
========== ========== ============= ==========
Real Estate and Related
Assets
Reserves and allowances
deducted from related
asset accounts:
Receivables
1997 $ 9 $ -- $ 3 $ 6
========== ========== ============= ==========
1996 $ 7 $ 3 $ 1 $ 9
========== ========== ============= ==========
1995 $ 4 $ 1 $ (2)(1) $ 7
========== ========== ============= ==========
Mortgage-related
financial
instruments
1997 $ 7 $ 13 $ (7)(2) $ 27
========== ========== ============= ==========
1996 $ 2 $ -- $ (5)(2) $ 7
========== ========== ============= ==========
1995 $ 8 $ -- $ 6 $ 2
========== ========== ============= ==========
Investment in and
advances to joint
ventures and
limited partnerships
1997 $ 27 $ -- $ 21 $ 6
========== ========== ============= ==========
1996 $ 38 $ -- $ 11 $ 27
========== ========== ============= ==========
1995 $ 49 $ -- $ 11 $ 38
========== ========== ============= ==========
(1) Includes allowances transferred in on partnership notes that were
consolidated.
(2) Includes allowances transferred in from other liabilities.
18
Weyerhaeuser Company and Subsidiaries
Exhibits Index
Exhibits:
3 - (i) Articles of Incorporation
(ii) Bylaws
10 - Material Contracts
(a) Agreement with N. E. Johnson (incorporated by reference
to 1992 Form 10-K filed with the Securities and Exchange
Commission on March 12, 1993-Commission File Number
1-4825)
(b) Agreement with W. R. Corbin (incorporated by reference to
1992 Form 10-K filed with the Securities and Exchange
Commission on March 12, 1993-Commission File Number
1-4825)
(c) Agreement with R. C. Gozon (incorporated by reference to
1995 Form 10-K filed with the Securities and Exchange
Commission on March 15, 1996-Commission File Number
1-4825)
(d) Agreement with S. R. Rogel
11 - Statement Re: Computation of Per Share Earnings
(incorporated by reference to Note 2 of the 1997
Weyerhaeuser Company Annual Report to Shareholders)
13 - Portions of the 1997 Weyerhaeuser Company Annual
Report to Shareholders specifically incorporated by
reference herein
22 - Subsidiaries of the Registrant
23 - Consent of Independent Public Accountants
27 - Financial Data Schedules
19
Weyerhaeuser Company and Subsidiaries
Exhibit 22
Subsidiaries of the Registrant
Percentage
State or Ownership of
Country of Immediate
Name Incorporation Parent
---- ----------------- -------------
Columbia & Cowlitz Railway Company Washington 100%
DeQueen and Eastern Railroad Company Arkansas 100
Dynetherm, Inc. Alabama 100
Fisher Lumber Company California 100
Golden Triangle Railroad Mississippi 100
Green Arrow Motor Express Company Delaware 100
Gryphon Asset Management, Inc. Delaware 100
J.H. Hamlen & Son, Inc. Arkansas 100
Mississippi & Skuna Valley Railroad
Company Mississippi 100
Mountain Tree Farm Company Washington 50
North Pacific Paper Corporation Delaware 50
NORPAC Sales Corporation Guam 100
Norpac Resources Inc. Delaware 100
Pacific Veneer, Ltd. Washington 90
SCA Weyerhaeuser Packaging Holding Company British Virgin
Asia Limited Islands 50
Texas, Oklahoma & Eastern Railroad Company Oklahoma 100
United Structures, Inc. California 100
Westwood Shipping Lines, Inc. Washington 100
Weycomp Claims Management Service, Inc. Texas 100
Weyerhaeuser Company of Nevada Nevada 100
Weyerhaeuser Construction Company Washington 100
Weyerhaeuser Financial Services, Inc. Delaware 100
CMO Finance Corp. Nevada 100
MJ Finance Corporation California 100
Mortgage Securities III Corporation Nevada 100
R4 Participant Corporation Nevada 100
ver Bes' Insurance Company Vermont 100
de Bes' Insurance Ltd. Bermuda 100
Weyerhaeuser Financial Investments, Inc. Nevada 100
Abfall Finance Corp. California 100
Brookview, Inc. Nevada 100
The Giddings Mortgage Investment
Company California 100
Gudig Abfall, Inc. California 100
Kachura Finance Corp. California 100
McGNT Finance Corp. California 100
Pass-Through Finance Corp. California 100
1
Weyerhaeuser Company and Subsidiaries
Exhibit 22
Subsidiaries of the Registrant - Continued
Percentage
State or Ownership of
Country of Immediate
Name Incorporation Parent
---- ----------------- -------------
RFS Finance Corp. California 100%
Trimark Development Company California 100
Trimark Realty Advisors, Inc. California 100
WFI Servicing Company Nevada 100
Woodland Hills Properties-W., Inc. Nevada 100
Monthill, Inc. California 100
WVC II, Inc. Nevada 100
Weyerhaeuser Venture Company Nevada 100
Las Positas Land Co. California 100
WAMCO, Inc. Nevada 100
Weyerhaeuser Realty Investors, Inc. Washington 100
Weyerhaeuser Forestlands International,
Inc. Washington 100
Weyerhaeuser International, Inc. Washington 100
Weyerhaeuser Canada Ltd. Canada 100
Weyerhaeuser Barbados SRL Barbados 100
Marlborough Capital Corp. SRL Barbados 100
Weyerhaeuser (BVI) Ltd. British Virgin
Islands 100
Weyerhaeuser New Zealand
Holdings, Inc. New Zealand 100
Nelson Forest Products Company New Zealand 100
Weyerhaeuser New Zealand, Inc. New Zealand 100
Weyerhaeuser de Mexico, S.A. de C.V. Mexico 100
Weyerhaeuser Saskatchewan Ltd. Canada 100
Weyerhaeuser China, Ltd. Washington 100
Weyerhaeuser GMBH Germany 100
Weyerhaeuser (Asia) Limited Hong Kong 100
Weyerhaeuser Italia, S.r.l. Italy 100
Weyerhaeuser Japan Ltd. Japan & Delaware 100
Weyerhaeuser Korea Ltd. Korea 100
Weyerhaeuser, S.A. Panama 100
Weyerhaeuser Taiwan Ltd. Delaware 100
Weyerhaeuser International Sales Corp. Guam 100
Weyerhaeuser (Mexico) Inc. Washington 100
Weyerhaeuser Midwest, Inc. Washington 100
Weyerhaeuser Overseas Finance Co. Delaware 100
Weyerhaeuser International
Finance Company Delaware 100
Weyerhaeuser Company Nova Scotia Canada 100
Weyerhaeuser Raw Materials, Inc. Delaware 100
2
Weyerhaeuser Company and Subsidiaries
Exhibit 22
Subsidiaries of the Registrant - Continued
Percentage
State or Ownership of
Country of Immediate
Name Incorporation Parent
---- ----------------- -------------
Weyerhaeuser Real Estate Company Washington 100%
Centennial Homes, Inc. Texas 100
Midway Properties, Inc. North Carolina 100
Pardee Construction Company California 100
Marmont Realty Company California 100
Pardee Construction Company
of Nevada Nevada 100
Pardee Investment Company California 100
Parvada, Inc. Nevada 100
The Quadrant Corporation Washington 100
Quadrant Real Estate Services, Inc. Washington 100
South Jersey Assets, Inc. New Jersey 100
Scarborough Constructors, Inc. Florida 100
Silverthorn Country Club, Inc. Florida 100
TMI, Inc. Texas 100
Weyerhaeuser Real Estate Company
of Nevada Nevada 100
Winchester Homes, Inc. Delaware 100
SC-WHI, Inc. Delaware 100
Weyerhaeuser Sales Company Nevada 100
The Wray Company Arizona 100
3
Weyerhaeuser Company and Subsidiaries
Exhibit 23
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation of our reports included and incorporated by reference in this
Form 10-K, into Weyerhaeuser Company's previously filed Registration
Statement No. 333-36753 on Form S-3 and Nos. 33-60527, 33-60529, 33-60521,
33-60525, 33-25928, 33-24979, 33-47392, 333-10165, 33-41414, 2-88109, 2-27929,
2-58498, 2-81463 and 333-01565 on Form S-8.
ARTHUR ANDERSEN LLP
Seattle, Washington,
March 13, 1998
1