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Plum Creek Reports Results For Second Quarter 2013

Stocks in this article: PCL

Earnings Conference Call and Supplemental Information

Plum Creek will hold a conference call today, July 29, 2013 at 5:00 p.m. ET (2:00 p.m. PT). A live webcast of the conference call may be accessed through Plum Creek’s website at www.plumcreek.com by clicking on the “Investors” section.

Investors without Internet access should dial 1-800-572-9852 at least 10 minutes prior to the start of the call, referencing Plum Creek’s earnings conference call. Those wishing to access the call from outside the United States and Canada should dial 1-706-645-9676, also referencing Plum Creek’s earnings conference call. Replay of the call will be available for 48 hours after completion of the live call and can be accessed at 1-855-859-2056 or 1-404-537-3406 (international calls), using the code 31587215.

Supplemental financial information for Plum Creek operations, including statistical data and reconciliations to non-GAAP measures is available in the Investors section of Plum Creek’s website at www.plumcreek.com.

Plum Creek is among the largest and most geographically diverse private landowners in the nation with approximately 6.3 million acres of timberlands in major timber producing regions of the United States and wood products manufacturing facilities in the Northwest. For more information, visit www.plumcreek.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Litigation Reform Act of 1995 as amended. Some of these forward-looking statements can be identified by the use of forward-looking words such as "believes," "expects," "may," "will," "should," "seek," "approximately," "intends," "plans," "estimates," or "anticipates," or the negative of those words or other comparable terminology. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions including, but not limited to, the cyclical nature of the forest products industry, our ability to harvest our timber, our ability to execute our acquisition strategy, the market for and our ability to sell or exchange non-strategic timberlands and timberland properties that have higher and better uses, and various regulatory constraints. These and other risks, uncertainties and assumptions are detailed from time to time in our filings with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the Securities Act of 1933, as amended. It is likely that if one or more of the risks materializes, or if one or more assumptions prove to be incorrect, the current expectations of Plum Creek and its management will not be realized. Forward-looking statements are not guarantees of performance, and speak only as of the date made, and neither Plum Creek nor its management undertakes any obligation to update or revise any forward-looking statements.

 
PLUM CREEK TIMBER COMPANY, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
   
(In Millions, Except Per Share Amounts) Six Months Ended June 30,
2013   2012
REVENUES:
Timber $ 316 $ 312
Real Estate 131 147
Manufacturing 185 161
Other 11   11  
Total Revenues 643   631  
 
COSTS AND EXPENSES:
Cost of Goods Sold:
Timber 232 244
Real Estate 52 84
Manufacturing 157 143
Other 2   1  
Total Cost of Goods Sold 443 472
Selling, General and Administrative 61   55  
Total Costs and Expenses 504   527  
 
Other Operating Income (Expense), net 1   1  
 
Operating Income 140 105
 
Equity Earnings from Timberland Venture 31 28
 
Interest Expense, net:
Interest Expense (Debt Obligations to Unrelated Parties) 41 40
Interest Expense (Note Payable to Timberland Venture) 29   29  
Total Interest Expense, net 70 69
 
Income before Income Taxes 101 64
 
Provision (Benefit) for Income Taxes (1 ) (1 )
   
Net Income $ 102   $ 65  
 
PER SHARE AMOUNTS:
 
Net Income per Share – Basic $ 0.63 $ 0.40
Net Income per Share – Diluted $ 0.62 $ 0.40
 
Weighted-Average Number of Shares Outstanding
– Basic 162.6 161.4
– Diluted 163.1 161.7
 
 
PLUM CREEK TIMBER COMPANY, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
   
(In Millions, Except Per Share Amounts) Quarter Ended June 30,
2013 2012
REVENUES:
Timber $ 146 $ 157
Real Estate 53 47
Manufacturing 99 85
Other 5   5
Total Revenues 303   294
 
COSTS AND EXPENSES:
Cost of Goods Sold:
Timber 108 123
Real Estate 22 16
Manufacturing 82 73
Other 1   1
Total Cost of Goods Sold 213 213
Selling, General and Administrative 29   27
Total Costs and Expenses 242   240
 
Other Operating Income (Expense), net 1   1
 
Operating Income 62 55
 
Equity Earnings from Timberland Venture 17 15
 
Interest Expense, net:
Interest Expense (Debt Obligations to Unrelated Parties) 20 19
Interest Expense (Note Payable to Timberland Venture) 15   15
Total Interest Expense, net 35 34
 
Income before Income Taxes 44 36
 
Provision (Benefit) for Income Taxes (2 )
   
Net Income $ 46   $ 36
 
PER SHARE AMOUNTS:
 
Net Income per Share – Basic $ 0.28 $ 0.22
Net Income per Share – Diluted $ 0.28 $ 0.22
 
Weighted-Average Number of Shares Outstanding
– Basic 162.9 161.5
– Diluted 163.4 161.7
 
 
PLUM CREEK TIMBER COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
   
(In Millions, Except Per Share Amounts)

June 30, 2013

December 31, 2012

ASSETS
Current Assets:
Cash and Cash Equivalents $ 355 $ 356
Accounts Receivable 40 22
Inventories 49 49
Deferred Tax Asset 8 7
Assets Held for Sale 49 61
Other Current Assets 37   13  
538 508
 
Timber and Timberlands, net 3,420 3,363
Mineral Rights, net 87 87
Property, Plant and Equipment, net 118 127
Equity Investment in Timberland Venture 208 204
Deferred Tax Asset 19 19
Investment in Grantor Trusts (at Fair Value) 42 39
Other Assets 33   37  
Total Assets $ 4,465   $ 4,384  
 
LIABILITIES
Current Liabilities:
Current Portion of Long-Term Debt $ 74 $ 248
Line of Credit 353 104
Accounts Payable 28 26
Interest Payable 22 26
Wages Payable 15 29
Taxes Payable 13 9
Deferred Revenue 33 23
Other Current Liabilities 10   7  
548 472
 
Long-Term Debt 1,815 1,815
Note Payable to Timberland Venture 783 783
Other Liabilities 91   91  
Total Liabilities 3,237   3,161  
 
Commitments and Contingencies
 
STOCKHOLDERS’ EQUITY
Preferred Stock, $0.01 Par Value, Authorized Shares – 75.0, Outstanding – None
Common Stock, $0.01 Par Value, Authorized Shares – 300.6, Outstanding (net of Treasury Stock) – 163.0 at June 30, 2013 and 162.0 at December 31, 2012 2 2
Additional Paid-In Capital 2,328 2,288
Retained Earnings (Accumulated Deficit) (135 ) (97 )
Treasury Stock, at Cost, Common Shares – 27.0 at June 30, 2013 and 26.9 at December 31, 2012 (940 ) (938 )
Accumulated Other Comprehensive Income (Loss) (27 ) (32 )
Total Stockholders’ Equity 1,228   1,223  
Total Liabilities and Stockholders’ Equity $ 4,465   $ 4,384  
 
 
PLUM CREEK TIMBER COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
   
Six Months Ended June 30,
(In Millions) 2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 102 $ 65
Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities:
Depreciation, Depletion and Amortization 51 56
Basis of Real Estate Sold 42 75
Equity Earnings from Timberland Venture (31 ) (28 )
Distributions from Timberland Venture 27 28
Deferred Income Taxes (1 ) (1 )
Deferred Revenue from Long-Term Gas Leases (Net of Amortization) (4 ) (5 )
Timber Deed Acquired (18 ) (98 )
Pension Plan Contributions (7 )
Working Capital Changes (40 ) (2 )
Other 12   6  
Net Cash Provided By (Used In) Operating Activities 140   89  
 
CASH FLOWS FROM INVESTING ACTIVITIES
Capital Expenditures (Excluding Timberland Acquisitions) (31 ) (35 )
Timberlands Acquired (78 ) (13 )
Other   (1 )
Net Cash Provided By (Used In) Investing Activities (109 ) (49 )
 
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends (140 ) (136 )
Borrowings on Line of Credit 721 1,129
Repayments on Line of Credit (472 ) (1,026 )
Debt Issuance Costs (3 )
Principal Payments and Retirement of Long-Term Debt (174 )
Proceeds from Stock Option Exercises 35 3
Acquisition of Treasury Stock (2 ) (1 )
Net Cash Provided By (Used In) Financing Activities (32 ) (34 )
 
Increase (Decrease) In Cash and Cash Equivalents (1 ) 6
Cash and Cash Equivalents:
Beginning of Period 356 254
   
End of Period $ 355   $ 260  
 
 
PLUM CREEK TIMBER COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
   
Quarter Ended June 30,
(In Millions) 2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 46 $ 36
Adjustments to Reconcile Net Income to Net Cash Provided By Operating Activities:
Depreciation, Depletion and Amortization 25 29
Basis of Real Estate Sold 17 12
Equity Earnings from Timberland Venture (17 ) (15 )
Deferred Income Taxes (2 )
Deferred Revenue from Long-Term Gas Leases (Net of Amortization) (1 ) (3 )
Pension Plan Contributions (7 )
Working Capital Changes Impacting Cash Flow:
Like-Kind Exchange Funds 53
Other Working Capital Changes 12 28
Other 6   3  
Net Cash Provided By (Used In) Operating Activities 139   83  
 
CASH FLOWS FROM INVESTING ACTIVITIES
Capital Expenditures (Excluding Timberland Acquisitions) (17 ) (17 )
Timberlands Acquired (76 ) (11 )
Net Cash Provided By (Used In) Investing Activities (93 ) (28 )
 
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends (72 ) (68 )
Borrowings on Line of Credit 430 370
Repayments on Line of Credit (355 ) (370 )
Proceeds from Stock Option Exercises 10    
Net Cash Provided By (Used In) Financing Activities 13   (68 )
 
Increase (Decrease) In Cash and Cash Equivalents 59 (13 )
Cash and Cash Equivalents:
Beginning of Period 296 273
   
End of Period $ 355   $ 260  
 
 
PLUM CREEK TIMBER COMPANY, INC.
SEGMENT DATA
(UNAUDITED)
   
Six Months Ended June 30,
(In Millions) 2013 2012
Revenues:
Northern Resources $ 127 $ 120
Southern Resources 202 202
Real Estate 131 147
Manufacturing 185 161
Other 11 11
Eliminations (13 ) (10 )
Total Revenues $ 643   $ 631  
 
Operating Income (Loss):
Northern Resources $ 19 $ 10
Southern Resources 47 43
Real Estate 75 59
Manufacturing 24 13
Other 9 9
Other Costs and Eliminations, net (34 ) (29 )
Total Operating Income $ 140   $ 105  
 
Adjusted EBITDA by Segment: (A)
Northern Resources $ 31 $ 23
Southern Resources 75 76
Real Estate 117 135
Manufacturing 32 20
Other 10 9
Other Costs and Eliminations, net (33 ) (29 )
Total $ 232   $ 234  
 

(A) Refer to the separate schedule, "Segment Data - Adjusted EBITDA" for reconciliations of Adjusted EBITDA to operating income and net cash provided by operating activities.

 
 
PLUM CREEK TIMBER COMPANY, INC.
SEGMENT DATA
(UNAUDITED)
   
Quarter Ended June 30,
(In Millions) 2013 2012
Revenues:
Northern Resources $ 53 $ 56
Southern Resources 98 105
Real Estate 53 47
Manufacturing 99 85
Other 5 5
Eliminations (5 ) (4 )
Total Revenues $ 303   $ 294  
 
Operating Income (Loss):
Northern Resources $ 8 $ 4
Southern Resources 23 22
Real Estate 30 29
Manufacturing 14 9
Other 4 4
Other Costs and Eliminations, net (17 ) (13 )
Total Operating Income $ 62   $ 55  
 
Adjusted EBITDA by Segment: (A)
Northern Resources $ 13 $ 10
Southern Resources 37 40
Real Estate 47 42
Manufacturing 18 12
Other 5 4
Other Costs and Eliminations, net (16 ) (13 )
Total $ 104   $ 95  
 

(A) Refer to the separate schedule, "Segment Data - Adjusted EBITDA" for reconciliations of Adjusted EBITDA to operating income and net cash provided by operating activities.

 

Plum Creek Timber Company, Inc.

Segment Data - Adjusted EBITDA

Reconciliation of Operating Income and Net Cash

Provided by Operating Activities

(Unaudited)

We define Adjusted EBITDA as earnings from continuing operations, excluding equity method earnings, and before interest, taxes, depreciation, depletion, amortization, and basis in lands sold. Adjusted EBITDA is not considered a measure of financial performance under U.S. generally accepted accounting principles (U.S. GAAP) and the items excluded from Adjusted EBITDA are significant components of our consolidated financial statements.

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