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EX-99.1 - EXHIBIT 99.1 - WEYERHAEUSER COa2018q4ex-991.htm
8-K - 8-K - WEYERHAEUSER COwy2018q48kearningsrelease.htm


Weyerhaeuser Company
 
 


 
 


 
 

Exhibit 99.2
 
Q4.2018 Analyst Package
 
 



 
 


 
 


 
Preliminary results (unaudited)
 
 


 
 




 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated Statement of Operations

 
 


 
 








Q1
 
Q2
 
Q3
 
Q4
 
Year-to-Date
in millions
Mar 31, 2018
 
Jun 30, 2018
 
Sep 30, 2018
 
Dec 31, 2018
 
Dec 31, 2017
 
Dec 31, 2018
 
Dec 31, 2017
Net sales
$
1,865

 
$
2,065

 
$
1,910

 
$
1,636

 
$
1,823

 
$
7,476

 
$
7,196

Costs of sales
1,348

 
1,447

 
1,452

 
1,345

 
1,316

 
5,592

 
5,298

Gross margin
517

 
618

 
458

 
291

 
507

 
1,884

 
1,898

Selling expenses
23

 
23

 
20

 
22

 
21

 
88

 
87

General and administrative expenses
78

 
80

 
78

 
82

 
72

 
318

 
310

Research and development expenses
2

 
2

 
2

 
2

 
2

 
8

 
14

Charges for integration and restructuring, closures and asset impairments
2

 

 

 

 
16

 
2

 
194

Charges (recoveries) for product remediation, net
(20
)
 
20

 

 

 
50

 

 
290

Other operating costs (income), net
28

 
17

 
21

 
8

 
(130
)
 
74

 
(128
)
Operating income
404

 
476

 
337

 
177

 
476

 
1,394

 
1,131

Non-operating pension and other postretirement benefit (costs) credits
(24
)
 
(13
)
 
(17
)
 
(218
)
 
(16
)
 
(272
)
 
(62
)
Interest income and other
12

 
11

 
13

 
24

 
10

 
60

 
40

Interest expense, net of capitalized interest
(93
)
 
(92
)
 
(93
)
 
(97
)
 
(96
)
 
(375
)
 
(393
)
Earnings (loss) before income taxes
299

 
382

 
240

 
(114
)
 
374

 
807

 
716

Income taxes
(30
)
 
(65
)
 
15

 
21

 
(103
)
 
(59
)
 
(134
)
Net earnings (loss)
$
269

 
$
317

 
$
255

 
$
(93
)
 
$
271

 
$
748

 
$
582

 
 
Per Share Information


Q1
 
Q2
 
Q3
 
Q4
 
Year-to-Date
 
Mar 31, 2018
 
Jun 30, 2018
 
Sep 30, 2018
 
Dec 31, 2018
 
Dec 31, 2017
 
Dec 31, 2018
 
Dec 31, 2017
Earnings (loss) per share, basic and diluted
$
0.35

 
$
0.42

 
$
0.34

 
$
(0.12
)
 
$
0.36

 
$
0.99

 
$
0.77

Dividends paid per common share
$
0.32

 
$
0.32

 
$
0.34

 
$
0.34

 
$
0.32

 
$
1.32

 
$
1.25

Weighted average shares outstanding (in thousands):
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
756,815

 
757,829

 
754,986

 
748,694

 
755,409

 
754,556

 
753,085

Diluted
759,462

 
760,533

 
757,389

 
750,025

 
758,463

 
756,827

 
756,666

Common shares outstanding at end of period (in thousands)
756,700

 
757,646

 
749,199

 
746,391

 
755,223

 
746,391

 
755,223


 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization (Adjusted EBITDA)*

Q1
 
Q2
 
Q3
 
Q4
 
Year-to-Date
in millions
Mar 31, 2018
 
Jun 30, 2018
 
Sep 30, 2018
 
Dec 31, 2018
 
Dec 31, 2017
 
Dec 31, 2018
 
Dec 31, 2017
Net earnings (loss)
$
269

 
$
317

 
$
255

 
$
(93
)
 
$
271

 
$
748

 
$
582

Non-operating pension and other postretirement benefit costs (credits)
24

 
13

 
17

 
218

 
16

 
272

 
62

Interest income and other
(12
)
 
(11
)
 
(13
)
 
(24
)
 
(10
)
 
(60
)
 
(40
)
Interest expense, net of capitalized interest
93

 
92

 
93

 
97

 
96

 
375

 
393

Income taxes
30

 
65

 
(15
)
 
(21
)
 
103

 
59

 
134

Operating income
404

 
476

 
337

 
177

 
476

 
1,394

 
1,131

Depreciation, depletion and amortization
120

 
119

 
122

 
125

 
127

 
486

 
521

Basis of real estate sold
12

 
22

 
46

 
44

 
33

 
124

 
81

Unallocated pension service costs

 

 

 

 
1

 

 
4

Special items included in operating income
8

 
20

 

 

 
(86
)
 
28

 
343

Adjusted EBITDA*
$
544

 
$
637

 
$
505

 
$
346

 
$
551

 
$
2,032

 
$
2,080

 
 
 
 
 
 
 
 
 
 
 
 
 
 
*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, unallocated pension service costs 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.


Page 1 of 8




Weyerhaeuser Company
 
 
 
 
 
 
 
 
Total Company Statistics
 
Q4.2018 Analyst Package
 
 
 
 
 
 
 
 
 
 

 
Preliminary results (unaudited)
 
 
 
 
 
 
 
 
 


Special Items Included in Net Earnings (Income Tax Affected)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Q1
 
Q2
 
Q3
 
Q4
 
Year-to-Date
in millions
Mar 31, 2018
 
Jun 30, 2018
 
Sep 30, 2018
 
Dec 31, 2018
 
Dec 31, 2017
 
Dec 31, 2018
 
Dec 31, 2017
Net earnings (loss)
$
269

 
$
317

 
$
255

 
$
(93
)
 
$
271

 
$
748

 
$
582

Plum Creek merger and integration-related costs

 

 

 

 
12

 

 
27

Restructuring, impairments and other charges

 

 

 

 

 

 
151

Gain on sale of timberlands and other nonstrategic assets

 

 

 
(10
)
 
(99
)
 
(10
)
 
(99
)
Environmental remediation charges (recoveries)
21

 

 

 

 
(26
)
 
21

 
(26
)
Product remediation charges (recoveries), net
(15
)
 
15

 

 

 
31

 

 
180

Countervailing and antidumping duties charges (credits)(1)

 

 

 

 
(7
)
 

 
5

Tax adjustments(2)

 

 
(41
)
 
21

 
52

 
(20
)
 
52

Pension settlement charge(3)

 

 

 
152

 

 
152

 

Net earnings before special items
$
275

 
$
332

 
$
214

 
$
70

 
$
234

 
$
891

 
$
872

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Q1
 
Q2
 
Q3
 
Q4
 
Year-to-Date
 
Mar 31, 2018
 
Jun 30, 2018
 
Sep 30, 2018
 
Dec 31, 2018
 
Dec 31, 2017
 
Dec 31, 2018
 
Dec 31, 2017
Net earnings (loss) per diluted share
$
0.35

 
$
0.42

 
$
0.34

 
$
(0.12
)
 
$
0.36

 
$
0.99

 
$
0.77

Plum Creek merger and integration-related costs

 

 

 

 
0.02

 

 
0.03

Restructuring, impairments and other charges

 

 

 

 

 

 
0.21

Gain on sale of timberlands and other nonstrategic assets

 

 

 
(0.01
)
 
(0.14
)
 
(0.01
)
 
(0.14
)
Environmental remediation charges (recoveries)
0.03

 

 

 

 
(0.03
)
 
0.03

 
(0.03
)
Product remediation charges (recoveries), net
(0.02
)
 
0.02

 

 

 
0.04

 

 
0.23

Countervailing and antidumping duties charges (credits)(1)

 

 

 

 
(0.01
)
 

 
0.01

Tax adjustments(2)

 

 
(0.06
)
 
0.03

 
0.07

 
(0.03
)
 
0.07

Pension settlement charge(3)

 

 

 
0.20

 

 
0.20

 

Net earnings per diluted share before special items
$
0.36

 
$
0.44

 
$
0.28

 
$
0.10

 
$
0.31

 
$
1.18

 
$
1.15

 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) As of first quarter 2018, countervailing and antidumping duties are no longer reported as a special item.
(2) During third quarter 2018, we recorded a tax benefit related to our contribution to our U.S. qualified pension plan. During fourth quarter 2018 and 2017, we recorded tax adjustment charges of $21 million and $52 million, respectively.
(3) During fourth quarter 2018, we recorded a $200 million non-cash pre-tax settlement charge related to our U.S. qualified pension plan lump sum offer.

 
 
 
Selected Total Company Items


Q1
 
Q2
 
Q3

Q4

Year-to-Date
in millions
Mar 31, 2018
 
Jun 30, 2018
 
Sep 30, 2018

Dec 31, 2018

Dec 31, 2017

Dec 31, 2018

Dec 31, 2017
Pension and postretirement costs:
 
 
 
 
 










Pension and postretirement service cost
$
10

 
$
8

 
$
10

 
$
9

 
$
9

 
$
37

 
$
35

Non-operating pension and other postretirement benefit costs
24

 
13

 
17

 
218

 
16

 
272

 
62

Total company pension and postretirement costs
$
34

 
$
21

 
$
27

 
$
227

 
$
25

 
$
309

 
$
97


 
 
 
 
 
 
 
 
 
 
 
 
 

Page 2 of 8




Weyerhaeuser Company
 
 
 
 



 
Q4.2018 Analyst Package
 
 
 
 


Preliminary results (unaudited)
 
 
 
 





Consolidated Balance Sheet











March 31,
2018

June 30,
2018

September 30,
2018

December 31,
2018

December 31,
2017
in millions


ASSETS









Current assets:









Cash and cash equivalents
$
598

 
$
901

 
$
348

 
$
334

 
$
824

Receivables, less discounts and allowances
481

 
491

 
444

 
337

 
396

Receivables for taxes
24

 
23

 
140

 
137

 
14

Inventories
445

 
414

 
389

 
389

 
383

Prepaid expenses and other current assets
118

 
146

 
140

 
152

 
98

Current restricted financial investments held by variable interest entities
253

 
253

 
253

 
253

 

Total current assets
1,919

 
2,228

 
1,714

 
1,602

 
1,715

Property and equipment, net
1,573

 
1,597

 
1,672

 
1,857

 
1,618

Construction in progress
275

 
282

 
255

 
136

 
225

Timber and timberlands at cost, less depletion
12,888

 
12,790

 
12,727

 
12,671

 
12,954

Minerals and mineral rights, less depletion
306

 
302

 
297

 
294

 
308

Deferred tax assets
244

 
168

 
71

 
15

 
268

Other assets
318

 
319

 
329

 
312

 
356

Restricted financial investments held by variable interest entities
362

 
362

 
362

 
362

 
615

Total assets
$
17,885

 
$
18,048

 
$
17,427

 
$
17,249

 
$
18,059


 
 
 
 
 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
Current liabilities:
 
 
 
 
 
 
 
 
 
Current maturities of long-term debt
$

 
$

 
$

 
$
500

 
$
62

Current debt (nonrecourse to the company) held by variable interest entities
209

 
209

 
511

 
302

 
209

Borrowings on line of credit

 

 

 
425

 

Accounts payable
245

 
270

 
271

 
222

 
249

Accrued liabilities
457

 
543

 
491

 
490

 
645

Total current liabilities
911

 
1,022

 
1,273

 
1,939

 
1,165

Long-term debt
5,928

 
5,924

 
5,921

 
5,419

 
5,930

Long-term debt (nonrecourse to the company) held by variable interest entities
302

 
302

 

 

 
302

Deferred tax liabilities

 

 

 
43

 

Deferred pension and other postretirement benefits
1,454

 
1,224

 
885

 
527

 
1,487

Other liabilities
299

 
295

 
291

 
275

 
276

Total liabilities
8,894

 
8,767

 
8,370

 
8,203

 
9,160

Total equity
8,991

 
9,281

 
9,057

 
9,046

 
8,899

Total liabilities and equity
$
17,885

 
$
18,048

 
$
17,427

 
$
17,249

 
$
18,059


Page 3 of 8




Weyerhaeuser Company












 
Q4.2018 Analyst Package










Preliminary results (unaudited)













Consolidated Statement of Cash Flows
 
 
 
 
 
 
 
 
 
 

Q1

Q2

Q3

Q4

Year-to-Date
in millions
Mar 31, 2018

Jun 30, 2018

Sep 30, 2018

Dec 31, 2018

Dec 31, 2017

Dec 31, 2018

Dec 31, 2017
Cash flows from operations:













Net earnings (loss)
$
269

 
$
317

 
$
255

 
$
(93
)
 
$
271

 
$
748

 
$
582

Noncash charges (credits) to income:
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation, depletion and amortization
120

 
119

 
122

 
125

 
127

 
486

 
521

Basis of real estate sold
12

 
22

 
46

 
44

 
33

 
124

 
81

Deferred income taxes, net
10

 
15

 
86

 
(39
)
 
35

 
72

 
44

Pension and other postretirement benefits
34

 
21

 
27

 
227

 
25

 
309

 
97

Share-based compensation expense
9

 
9

 
13

 
11

 
11

 
42

 
40

Charges for impairment of assets
1

 

 

 

 
1

 
1

 
154

Net gains on disposition of discontinued and other operations

 

 

 

 

 

 
(1
)
Net gains on sale of nonstrategic assets
(2
)
 

 

 
(14
)
 
(2
)
 
(16
)
 
(16
)
Net gains on sale of southern timberlands

 

 

 

 
(99
)
 

 
(99
)
Change in:
 
 
 
 
 
 
 
 
 
 
 
 
 
Receivables, less allowances
(83
)
 
(18
)
 
46

 
117

 
78

 
62

 
(35
)
Receivables and payables for taxes
5

 
10

 
(124
)
 
6

 
66

 
(103
)
 
(50
)
Inventories
(66
)
 
30

 
27

 
(5
)
 
(43
)
 
(14
)
 
(39
)
Prepaid expenses and other current assets
(5
)
 
4

 
(6
)
 
(11
)
 
(3
)
 
(18
)
 
(12
)
Accounts payable and accrued liabilities
(173
)
 
103

 
(63
)
 
(21
)
 
(78
)
 
(154
)
 
106

Pension and postretirement contributions and payments
(16
)
 
(16
)
 
(323
)
 
(26
)
 
(19
)
 
(381
)
 
(78
)
Other
21

 
(19
)
 
(19
)
 
(29
)
 
(49
)
 
(46
)
 
(94
)
Net cash from (used in) operations
$
136

 
$
597

 
$
87

 
$
292

 
$
354

 
$
1,112

 
$
1,201

Cash flows from investing activities:
 
 
 
 
 
 
 
 
 
 
 
 
 
Capital expenditures for property and equipment

$
(61
)
 
$
(83
)
 
$
(94
)
 
$
(130
)
 
$
(145
)
 
$
(368
)
 
$
(358
)
Capital expenditures for timberlands reforestation
(20
)
 
(14
)
 
(11
)
 
(14
)
 
(15
)
 
(59
)
 
(61
)
Proceeds from disposition of discontinued and other operations

 

 

 

 

 

 
403

Proceeds from sale of nonstrategic assets
2

 

 

 
2

 
6

 
4

 
26

Proceeds from sale of southern timberlands

 

 

 

 
203

 

 
203

Proceeds from redemption of ownership in related party

 

 

 

 
108

 

 
108

Other
3

 
24

 
(10
)
 
(34
)
 
18

 
(17
)
 
46

Cash from (used in) investing activities
$
(76
)
 
$
(73
)
 
$
(115
)
 
$
(176
)
 
$
175

 
$
(440
)
 
$
367

Cash flows from financing activities:
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash dividends on common shares
$
(242
)
 
$
(243
)
 
$
(256
)
 
$
(254
)
 
$
(242
)
 
$
(995
)
 
$
(941
)
Proceeds from issuance of long-term debt

 

 

 

 

 

 
225

Payments on long-term debt
(62
)
 

 

 

 

 
(62
)
 
(831
)
Proceeds from borrowing on line of credit

 

 

 
425

 

 
425

 
100

Payments on line of credit

 

 

 

 

 

 
(100
)
Payments on debt held by variable interest entities

 

 

 
(209
)
 

 
(209
)
 

Proceeds from exercise of stock options
25

 
23

 
4

 

 
39

 
52

 
128

Repurchase of common shares

 

 
(273
)
 
(93
)
 

 
(366
)
 

Other
(7
)
 
(1
)
 

 
1

 
1

 
(7
)
 
(1
)
Cash from (used in) financing activities
$
(286
)
 
$
(221
)
 
$
(525
)
 
$
(130
)
 
$
(202
)
 
$
(1,162
)
 
$
(1,420
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net change in cash and cash equivalents
$
(226
)
 
$
303

 
$
(553
)
 
$
(14
)
 
$
327

 
$
(490
)
 
$
148

Cash and cash equivalents at beginning of period
824

 
598

 
901

 
348

 
497

 
824

 
676

Cash and cash equivalents at end of period
$
598

 
$
901

 
$
348

 
$
334

 
$
824

 
$
334

 
$
824

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash paid (received) during the year for:
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest, net of amount capitalized
$
105

 
$
67

 
$
113

 
$
73

 
$
66

 
$
358

 
$
381

Income taxes
$
17

 
$
41

 
$
22

 
$
15

 
$
40

 
$
95

 
$
169


Page 4 of 8




Weyerhaeuser Company
 
 
 
 
 
 
 
 
Timberlands Segment
 
Q4.2018 Analyst Package
 
 
 
 


 
 
 


 
Preliminary results (unaudited)
 
 
 
 






Segment Statement of Operations


 
 
 
 









in millions

Q1.2018
 
Q2.2018
 
Q3.2018

Q4.2018

Q4.2017

YTD.2018

YTD.2017
Sales to unaffiliated customers
$
505

 
$
482

 
$
468

 
$
460

 
$
496

 
$
1,915

 
$
1,942

Intersegment sales
228

 
185

 
185

 
204

 
218

 
802

 
762

Total net sales
733

 
667

 
653

 
664

 
714

 
2,717

 
2,704

Costs of sales
526

 
485

 
505

 
536

 
531

 
2,052

 
2,043

Gross margin
207

 
182

 
148

 
128

 
183

 
665

 
661

Selling expenses
1

 

 
1

 

 
1

 
2

 
4

General and administrative expenses
23

 
25

 
23

 
25

 
19

 
96

 
90

Research and development expenses
2

 
1

 
2

 
1

 
2

 
6

 
12

Charges for integration and restructuring, closures and asset impairments

 

 

 

 

 

 
147

Other operating costs (income), net
(8
)
 
(5
)
 
(4
)
 
(5
)
 
(104
)
 
(22
)
 
(124
)
Operating income and Net contribution to earnings
$
189

 
$
161

 
$
126

 
$
107

 
$
265

 
$
583

 
$
532



 
 
 
 












Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*


 
 
 
 












in millions

Q1.2018
 
Q2.2018
 
Q3.2018

Q4.2018

Q4.2017
 
YTD.2018
 
YTD.2017
Operating income
$
189

 
$
161

 
$
126

 
$
107

 
$
265

 
$
583

 
$
532

Depreciation, depletion and amortization
79

 
79

 
80

 
81

 
86

 
319

 
356

Special items

 

 

 

 
(99
)
 

 
48

Adjusted EBITDA*
$
268

 
$
240

 
$
206

 
$
188

 
$
252

 
$
902

 
$
936

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


 
 
 
 












Segment Special Items Included in Net Contribution to Earnings (Pre-Tax)  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
in millions
 
Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Restructuring, impairments and other charges
$

 
$

 
$

 
$

 
$

 
$

 
$
(147
)
Gain on sale of timberlands and other nonstrategic assets
$

 
$

 
$

 
$

 
$
99

 
$

 
$
99

Total
 
$

 
$

 
$

 
$

 
$
99

 
$

 
$
(48
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selected Segment Items


 
 
 
 












in millions

Q1.2018
 
Q2.2018
 
Q3.2018

Q4.2018

Q4.2017
 
YTD.2018
 
YTD.2017
Total decrease (increase) in working capital(1)
$
(40
)
 
$
70

 
$
(32
)
 
$
(7
)
 
$
(15
)
 
$
(9
)
 
$
5

Cash spent for capital expenditures
$
(28
)
 
$
(29
)
 
$
(25
)
 
$
(35
)
 
$
(36
)
 
$
(117
)
 
$
(115
)
(1) Represents the change in prepaid assets, accounts receivable, accounts payable, accrued liabilities and log inventory for the Timberlands and Real Estate & ENR segments combined.


 
 
 
 












Segment Statistics(2)(3)


 
 
 
 













Q1.2018
 
Q2.2018
 
Q3.2018

Q4.2018

Q4.2017
 
YTD.2018
 
YTD.2017
Third Party
Net Sales
(millions)
Delivered logs:

 

 









West
$
266

 
$
262

 
$
238

 
$
221

 
$
242

 
$
987

 
$
915

South
157

 
158

 
157

 
153

 
165

 
625

 
616

North
25

 
20

 
25

 
29

 
27

 
99

 
95

Other
14

 
7

 
9

 
11

 
11

 
41

 
59

Total delivered logs
462

 
447

 
429

 
414

 
445

 
1,752

 
1,685

Stumpage and pay-as-cut timber
15

 
11

 
13

 
20

 
21

 
59

 
73

Products from international operations

 

 

 

 

 

 
63

Recreational and other lease revenue
14

 
15

 
15

 
15

 
14

 
59

 
59

Other revenue
14

 
9

 
11

 
11

 
16

 
45

 
62

Total
$
505

 
$
482

 
$
468

 
$
460

 
$
496

 
$
1,915

 
$
1,942

Delivered Logs
Third Party Sales
Realizations (per ton)
West
$
131.59

 
$
132.24

 
$
125.67

 
$
112.58

 
$
121.41

 
$
125.59

 
$
111.58

South
$
34.83

 
$
34.55

 
$
34.88

 
$
34.38

 
$
34.53

 
$
34.66

 
$
34.43

North
$
60.79

 
$
64.92

 
$
60.97

 
$
57.27

 
$
60.77

 
$
60.55

 
$
60.38

Delivered Logs
Third Party Sales
Volumes
(tons, thousands)
West
2,019

 
1,984

 
1,897

 
1,958

 
1,992

 
7,858

 
8,202

South
4,510

 
4,560

 
4,521

 
4,417

 
4,790

 
18,008

 
17,895

North
404

 
313

 
414

 
497

 
439

 
1,628

 
1,574

Other
317

 
81

 
154

 
204

 
232

 
756

 
1,458

Fee Harvest Volumes
(tons, thousands)
West
2,443

 
2,360

 
2,305

 
2,463

 
2,544

 
9,571

 
10,083

South
6,751

 
6,630

 
6,478

 
6,849

 
7,350

 
26,708

 
27,149

North
549

 
423

 
537

 
620

 
635

 
2,129

 
2,205

Other

 

 

 

 

 

 
1,384

(2) The Western region includes Washington and Oregon. The Southern region includes Virginia, North Carolina, South Carolina, Florida, Georgia, Alabama, Mississippi, Louisiana, Arkansas, Texas and Oklahoma. The Northern region includes West Virginia, Maine, New Hampshire, Vermont, Michigan, Wisconsin and Montana. Other includes our Canadian operations and formerly managed Twin Creeks operations (our management agreement for the Twin Creeks Venture began in April 2016 and terminated in December 2017).
(3) Western logs are primarily transacted in MBF but are converted to ton equivalents for external reporting purposes.


Page 5 of 8




Weyerhaeuser Company
 
 
Real Estate, Energy and Natural Resources Segment
 
Q4.2018 Analyst Package
 
 
 
 


 
 
 
 

 
Preliminary results (unaudited)
 
 
 
 








 
 
 
 









Segment Statement of Operations


 
 
 
 









in millions

Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Net sales
$
51

 
$
58

 
$
96

 
$
102

 
$
100

 
$
307

 
$
281

Costs of sales
19

 
30

 
54

 
52

 
43

 
155

 
110

Gross margin
32

 
28

 
42

 
50

 
57

 
152

 
171

General and administrative expenses
7

 
6

 
6

 
7

 
6

 
26

 
26

Other operating costs (income), net

 

 

 

 
1

 

 

Operating income
25

 
22

 
36

 
43

 
50

 
126

 
145

Interest income and other

 

 

 
1

 

 
1

 
1

Net contribution to earnings
$
25

 
$
22

 
$
36

 
$
44

 
$
50

 
$
127

 
$
146

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*


 
 
 
 












in millions

Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Operating income
 
$
25

 
$
22

 
$
36

 
$
43

 
$
50

 
$
126

 
$
145

Depreciation, depletion and amortization
4

 
3

 
4

 
3

 
4

 
14

 
15

Basis of real estate sold
12

 
22

 
46

 
44

 
33

 
124

 
81

Adjusted EBITDA*
$
41

 
$
47

 
$
86

 
$
90

 
$
87

 
$
264

 
$
241

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


















in millions

Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Cash spent for capital expenditures
$

 
$

 
$

 
$

 
$

 
$

 
$
(2
)


 
 
 
 









Segment Statistics


 
 
 
 














Q1.2018

Q2.2018

Q3.2018

Q4.2018

Q4.2017
 
YTD.2018
 
YTD.2017

Net Sales
(millions)
Real Estate
$
34

 
$
38

 
$
76

 
$
81

 
$
80

 
$
229

 
$
208

Energy and Natural Resources
17

 
20

 
20

 
21

 
20

 
78

 
73

Total
$
51

 
$
58

 
$
96

 
$
102

 
$
100

 
$
307

 
$
281

Acres sold
Real Estate
21,771

 
16,290

 
61,681

 
31,833

 
38,226

 
131,575

 
97,235

Price per acre
Real Estate
$
1,539

 
$
2,258

 
$
1,209

 
$
2,479

 
$
2,076

 
$
1,701

 
$
2,079



Page 6 of 8




Weyerhaeuser Company
 
 
 
 
 
 
 
 
Wood Products Segment
 
Q4.2018 Analyst Package
 
 
 
 


 
 
 
 

 
Preliminary results (unaudited)
 
 
 
 








 
 
 
 









Segment Statement of Operations  


 
 
 
 









in millions

Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Net sales
$
1,309

 
$
1,525

 
$
1,346

 
$
1,075

 
$
1,228

 
$
5,255

 
$
4,974

Costs of sales
1,005

 
1,119

 
1,071

 
991

 
947

 
4,186

 
3,880

Gross margin
304

 
406

 
275

 
84

 
281

 
1,069

 
1,094

Selling expenses
21

 
22

 
18

 
20

 
20

 
81

 
80

General and administrative expenses
34

 
31

 
32

 
33

 
32

 
130

 
126

Research and development expenses

 
1

 

 
1

 

 
2

 
2

Charges for integration and restructuring, closures and asset impairments
2

 

 

 

 
2

 
2

 
13

Charges (recoveries) for product remediation, net
(20
)
 
20

 

 

 
50

 

 
290

Other operating costs (income), net
(3
)
 
3

 
12

 
4

 
(3
)
 
16

 
14

Operating income and Net contribution to earnings
$
270

 
$
329

 
$
213

 
$
26

 
$
180

 
$
838

 
$
569



 
 
 
 












Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*


 
 
 
 












in millions

Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Operating income
$
270

 
$
329

 
$
213

 
$
26

 
$
180

 
$
838

 
$
569

Depreciation, depletion and amortization
36

 
36

 
37

 
40

 
37

 
149

 
145

Special items
(20
)
 
20

 

 

 
41

 

 
303

Adjusted EBITDA*
$
286

 
$
385

 
$
250

 
$
66

 
$
258

 
$
987

 
$
1,017

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

Segment Special Items Included in Net Contribution to Earnings (Pre-Tax)  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
in millions
 
Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Countervailing and antidumping duties (charges) credits(1)
$

 
$

 
$

 
$

 
$
9

 
$

 
$
(7
)
Restructuring, impairments and other charges

 

 

 

 

 

 
(6
)
Product remediation (charges) recoveries, net
20

 
(20
)
 

 

 
(50
)
 

 
(290
)
Total
 
$
20

 
$
(20
)
 
$

 
$

 
$
(41
)
 
$

 
$
(303
)
(1) As of first quarter 2018, countervailing and antidumping duties are no longer reported as a special item.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selected Segment Items


 
 
 
 












in millions

Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Total decrease (increase) in working capital(2)
$
(226
)
 
$
3

 
$
71

 
$
83

 
$
(81
)
 
$
(69
)
 
$
60

Cash spent for capital expenditures
$
(52
)
 
$
(68
)
 
$
(79
)
 
$
(107
)
 
$
(123
)
 
$
(306
)
 
$
(299
)
(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
Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Structural Lumber
(board feet)
Third party net sales
$
569

 
$
681

 
$
581

 
$
427

 
$
517

 
$
2,258

 
$
2,058

Third party sales realizations
$
498

 
$
541

 
$
491

 
$
388

 
$
466

 
$
482

 
$
442

Third party sales volumes(3)
1,140

 
1,261

 
1,184

 
1,099

 
1,110

 
4,684

 
4,658

Production volumes
1,160

 
1,180

 
1,106

 
1,095

 
1,118

 
4,541

 
4,509

Engineered Solid
Section
(cubic feet)
Third party net sales
$
129

 
$
139

 
$
132

 
$
121

 
$
122

 
$
521

 
$
500

Third party sales realizations
$
2,088

 
$
2,156

 
$
2,208

 
$
2,139

 
$
2,076

 
$
2,148

 
$
1,995

Third party sales volumes(3)
6.2

 
6.4

 
6.0

 
5.7

 
5.9

 
24.3

 
25.1

Production volumes
6.3

 
6.4

 
6.3

 
5.3

 
5.8

 
24.3

 
25.1

Engineered
I-joists
(lineal feet)
Third party net sales
$
78

 
$
92

 
$
91

 
$
75

 
$
85

 
$
336

 
$
336

Third party sales realizations
$
1,585

 
$
1,630

 
$
1,668

 
$
1,696

 
$
1,561

 
$
1,643

 
$
1,524

Third party sales volumes(3)
49

 
57

 
54

 
44

 
54

 
204

 
220

Production volumes
56

 
52

 
46

 
37

 
52

 
191

 
213

Oriented Strand
Board
(square feet 3/8")
Third party net sales
$
232

 
$
277

 
$
215

 
$
167

 
$
233

 
$
891

 
$
904

Third party sales realizations
$
314

 
$
367

 
$
321

 
$
252

 
$
335

 
$
315

 
$
304

Third party sales volumes(3)
739

 
754

 
669

 
665

 
697

 
2,827

 
2,971

Production volumes
734

 
747

 
665

 
691

 
739

 
2,837

 
2,995

Softwood Plywood
(square feet 3/8")
Third party net sales
$
50

 
$
55

 
$
53

 
$
42

 
$
40

 
$
200

 
$
176

Third party sales realizations
$
438

 
$
461

 
$
439

 
$
396

 
$
417

 
$
435

 
$
389

Third party sales volumes(3)
115

 
118

 
122

 
104

 
95

 
459

 
453

Production volumes
97

 
105

 
106

 
96

 
86

 
404

 
370

Medium Density Fiberboard
(square feet 3/4")
Third party net sales
$
43

 
$
47

 
$
48

 
$
39

 
$
37

 
$
177

 
$
183

Third party sales realizations
$
839

 
$
839

 
$
828

 
$
835

 
$
829

 
$
835

 
$
822

Third party sales volumes(3)

51

 
55

 
59

 
47

 
45

 
212

 
222

Production volumes
50

 
57

 
61

 
52

 
50

 
220

 
232

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

Page 7 of 8




Weyerhaeuser Company
 
 
 
 
 
 
 
 
Unallocated Items
 
Q4.2018 Analyst Package
 
 
 
 


 
 
 
 

 
Preliminary results (unaudited)
 
 
 
 







 
 
 
 









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

 
 
 
 









Contribution to Earnings

 
 
 
 









in millions
Q1.2018

Q2.2018

Q3.2018

Q4.2018

Q4.2017
 
YTD.2018
 
YTD.2017
Unallocated corporate function and variable compensation expenses
$
(18
)
 
$
(19
)
 
$
(19
)
 
$
(28
)
 
$
(18
)
 
$
(84
)
 
$
(73
)
Liability classified share-based compensation

 
(2
)
 
4

 
8

 
(2
)
 
10

 
(9
)
Foreign exchange gains (loss)
(2
)
 
2

 
(2
)
 
5

 
1

 
3

 
1

Elimination of intersegment profit in inventory and LIFO
(21
)
 
3

 

 
24

 
(14
)
 
6

 
(20
)
Charges for integration and restructuring, closures and asset impairments

 

 

 

 
(14
)
 

 
(34
)
Other
(39
)
 
(20
)
 
(21
)
 
(8
)
 
28

 
(88
)
 
20

Operating income (loss)
(80
)
 
(36
)
 
(38
)
 
1

 
(19
)
 
(153
)
 
(115
)
Non-operating pension and other postretirement benefit (costs) credits
(24
)
 
(13
)
 
(17
)
 
(218
)
 
(16
)
 
(272
)
 
(62
)
Interest income and other
12

 
11

 
13

 
23

 
10

 
59

 
39

Net contribution to earnings (loss)
$
(92
)
 
$
(38
)
 
$
(42
)
 
$
(194
)
 
$
(25
)
 
$
(366
)
 
$
(138
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*
 
 
 
 
 
 
 
 
 
 
 
 
 
 
in millions
Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Operating income (loss)
$
(80
)
 
$
(36
)
 
$
(38
)
 
$
1

 
$
(19
)
 
$
(153
)
 
$
(115
)
Depreciation, depletion and amortization
1

 
1

 
1

 
1

 

 
4

 
5

Unallocated pension service costs

 

 

 

 
1

 

 
4

Special items
28

 

 

 

 
(28
)
 
28

 
(8
)
Adjusted EBITDA*
$
(51
)
 
$
(35
)
 
$
(37
)
 
$
2

 
$
(46
)
 
$
(121
)
 
$
(114
)
* See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unallocated Special Items Included in Net Contribution to Earnings (Pre-Tax)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
in millions
Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Plum Creek merger and integration-related costs
$

 
$

 
$

 
$

 
$
(14
)
 
$

 
$
(34
)
Environmental remediation insurance (charges) recoveries
(28
)
 

 

 

 
42

 
(28
)
 
42

Special items included in operating income (loss)
(28
)
 

 

 

 
28

 
(28
)
 
8

Pension settlement charge

 

 

 
(200
)
 

 
(200
)
 

Gain on sale of nonstrategic assets

 

 

 
13

 

 
13

 

Special items included in net contribution to earnings (loss)
$
(28
)

$


$


$
(187
)

$
28


$
(215
)

$
8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unallocated Selected Items
 
 
 
 
 
 
 
 
 
 
 
 
 
 
in millions
Q1.2018
 
Q2.2018
 
Q3.2018
 
Q4.2018
 
Q4.2017
 
YTD.2018
 
YTD.2017
Cash spent for capital expenditures
$
(1
)
 
$

 
$
(1
)
 
$
(2
)
 
$
(1
)
 
$
(4
)
 
$
(3
)

Page 8 of 8