UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
April 29, 2011
(Date of earliest event report)
WEYERHAEUSER COMPANY
(Exact name of registrant as specified in charter)
| Washington | 1-4825 | 91-0470860 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(IRS Employer Identification Number) |
Federal Way, Washington 98063-9777
(Address of principal executive offices)
(zip code)
Registrant’s telephone number, including area code:
(253) 924-2345
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Exhibit 99.1 |
||
| Exhibit 99.2 |
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On April 29, 2011, Weyerhaeuser Company issued a press release announcing its financial results for the quarter ended March 31, 2011. Copies of the press release and the exhibits thereto are furnished as Exhibits 99.1 and 99.2 to this report.
In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
| (d) | The following items are filed as exhibits to this report: |
| 99.1 | Press release of Weyerhaeuser Company issued April 29, 2011 reporting results of operations for the quarter ended March 31, 2011 |
| 99.2 | Exhibits to press release of Weyerhaeuser Company issued April 29, 2011 |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WEYERHAEUSER COMPANY | ||||||
| By | /s/ Jerald W. Richards | |||||
| Its: | Chief Accounting Officer | |||||
| Date: April 29, 2011 | ||||||
Exhibit 99.1
| For more information contact: |
Media – Bruce Amundson (253) 924-3047 | |
| Analysts – Kathryn McAuley (253) 924-2058 | ||
Weyerhaeuser Reports First Quarter Results
FEDERAL WAY, Wash. (Apr. 29, 2011) – Weyerhaeuser Company (NYSE: WY) today reported net earnings of $99 million for the first quarter, or 18 cents per diluted share, on net sales of $1.6 billion. This compares with a net loss of $20 million on net sales of $1.4 billion for the same period last year.
Earnings for the first quarter of 2011 include an after-tax gain of $96 million on the previously announced sale of 82,000 acres of non-strategic timberlands in southwest Washington. Excluding this special item, the company reported net earnings of $3 million. This compares to a net loss before special items of $15 million in the first quarter of 2010.
“During the first quarter we continued to make progress in our drive to improve our financial performance despite anemic housing market conditions,” said Dan Fulton, president and chief executive officer. “We are leveraging our strength in the export markets to take advantage of increased demand from Asia. Our businesses are running more efficiently and our work to eliminate costs continues. We remain focused on making further improvements to achieve our goal of delivering superior returns.”
WEYERHAEUSER
| FINANCIAL HIGHLIGHTS (millions, except per share data) |
1Q 2011 | 4Q 2010 | 1Q 2010 | |||||||||
| Net sales |
$ | 1,578 | $ | 1,664 | $ | 1,419 | ||||||
| Net earnings (loss) |
$ | 99 | $ | 171 | ($ | 20 | ) | |||||
| Weighted average shares outstanding, diluted |
540 | 538 | 211 | |||||||||
| Earnings (loss) per diluted share |
$ | 0.18 | $ | 0.32 | ($ | 0.10 | ) | |||||
| Net earnings (loss) before special items |
$ | 3 | $ | 52 | ($ | 15 | ) | |||||
| Earnings (loss) per diluted share before special items |
$ | 0.00 | $ | 0.10 | ($ | 0.07 | ) | |||||
Weyerhaeuser’s outstanding shares increased substantially from the first quarter of 2010 due to a special dividend of approximately 324 million shares of common stock and $560 million in cash, paid on Sept. 1, 2010 in conjunction with the company’s conversion to a REIT.
TIMBERLANDS
| FINANCIAL HIGHLIGHTS (millions) | 1Q 2011 | 4Q 2010 | Change | |||||||||
| Net sales |
$ | 230 | $ | 207 | $ | 23 | ||||||
| Contribution to pre-tax earnings before special items |
$ | 89 | $ | 56 | $ | 33 | ||||||
| Pre-tax gain from special items |
$ | 152 | $ | 0 | $ | 152 | ||||||
| GAAP contribution to pre-tax earnings |
$ | 241 | $ | 56 | $ | 185 | ||||||
1Q 2011 Performance – First quarter earnings before special items increased $33 million compared with fourth quarter, as strong export demand resulted in improved selling prices and volumes for western logs. Fee harvest volumes increased, resulting in lower per unit logging costs. These improvements were partially offset by higher fuel costs.
First quarter results include a pre-tax gain of $152 million from the previously announced sale of 82,000 acres of non-strategic timberlands located in southwest Washington.
2Q 2011 Outlook – Excluding the disposition of non-strategic timberlands, Weyerhaeuser expects slightly higher earnings in the second quarter compared with the first. The company anticipates modestly improved selling prices for western logs and higher harvest volumes to be largely offset by higher fuel expenses and seasonally higher road and silviculture costs.
WOOD PRODUCTS
| FINANCIAL HIGHLIGHTS (millions) | 1Q 2011 | 4Q 2010 | Change | |||||||||
| Net sales |
$ | 624 | $ | 572 | $ | 52 | ||||||
| Charge to pre-tax earnings before special items |
($ | 36 | ) | ($ | 85 | ) | $ | 49 | ||||
| Pre-tax gains (charges) from special items |
$ | 0 | ($ | 103 | ) | $ | 103 | |||||
| GAAP charge to pre-tax earnings |
($ | 36 | ) | ($ | 188 | ) | $ | 152 | ||||
1Q 2011 Performance –The segment’s results before special items improved $49 million compared with the fourth quarter. Selling prices increased across most product lines. Per unit manufacturing costs declined due to continued cost reductions and improved operating rates for lumber and oriented strand board. This was partially offset by increased log costs.
Fourth quarter included special items of $103 million for asset impairments, closures and restructuring.
2Q 2011 Outlook – Weyerhaeuser anticipates a smaller loss from the segment in the second quarter due to seasonally higher sales volumes and improved operating rates.
CELLULOSE FIBERS
| FINANCIAL HIGHLIGHTS (millions) | 1Q 2011 | 4Q 2010 | Change | |||||||||
| Net sales |
$ | 506 | $ | 511 | ($ | 5 | ) | |||||
| Contribution to pre-tax earnings before special items |
$ | 86 | $ | 138 | ($ | 52 | ) | |||||
| Pre-tax gains (charges) from special items |
$ | 0 | $ | 0 | $ | 0 | ||||||
| GAAP contribution to pre-tax earnings |
$ | 86 | $ | 138 | ($ | 52 | ) | |||||
1Q 2011 Performance – First quarter earnings declined $52 million compared with fourth quarter. Average selling prices for pulp were slightly lower. Maintenance costs increased and production declined as the segment completed two planned annual maintenance outages in the first quarter, compared with one in the fourth quarter. Chemical, energy and fiber costs also increased.
2Q 2011 Outlook – Weyerhaeuser expects higher earnings from the Cellulose Fibers segment in the second quarter. The company anticipates higher selling prices, partially offset by increased maintenance costs due to an increase in the number of scheduled annual maintenance outages.
REAL ESTATE
| FINANCIAL HIGHLIGHTS (millions) | 1Q 2011 | 4Q 2010 | Change | |||||||||
| Net sales |
$ | 160 | $ | 305 | ($ | 145 | ) | |||||
| Contribution (charge) to pre-tax earnings before special items |
($ | 1 | ) | $ | 33 | ($ | 34 | ) | ||||
| Pre-tax charges from special items |
$ | 0 | ($ | 20 | ) | $ | 20 | |||||
| GAAP contribution (charge) to pre-tax earnings |
($ | 1 | ) | $ | 13 | ($ | 14 | ) | ||||
1Q 2011 Performance – Earnings before special items declined $34 million compared with the fourth quarter due to seasonally fewer home sale closings and lower margins. Home sale closings decreased 40 percent compared with the fourth quarter to 363 single-family homes. Margins on homes closed declined due to mix.
First quarter earnings included $1 million from the sale of land and lots, compared with $6 million from sale of land, lots and apartments in the fourth quarter.
Fourth quarter included special items of $20 million for asset impairments and restructuring.
2Q 2011 Outlook – Weyerhaeuser anticipates a small profit from single-family homebuilding operations in the second quarter due to a seasonal increase in home sale closings.
CORPORATE AND OTHER
| FINANCIAL HIGHLIGHTS (millions) | 1Q 2011 | 4Q 2010 | Change | |||||||||
| Contribution (charge) to pre-tax earnings before special items |
($ | 41 | ) | $ | 2 | ($ | 43 | ) | ||||
| Pre-tax gains from special items |
$ | 0 | $ | 39 | ($ | 39 | ) | |||||
| GAAP contribution (charge) to pre-tax earnings |
($ | 41 | ) | $ | 41 | ($ | 82 | ) | ||||
Earnings before special items declined $43 million compared with the fourth quarter, primarily due to non-cash pension and postretirement charges and higher share-based compensation expense.
First quarter segment results included pension and postretirement charges of $12 million, as the company amortized actuarial losses deferred in prior years. Fourth quarter included pension and postretirement credits of $19 million.
Share-based compensation expense for the segment increased $8 million compared with the fourth quarter, primarily due to a larger mark-to-market adjustment resulting from an increase in the company’s stock price.
Fourth quarter special items of $39 million included a gain on the sale of five short line railroads, partially offset by charges for restructuring, closures and impairments.
ABOUT WEYERHAEUSER
Weyerhaeuser Company, one of the world’s largest forest products companies, began operations in 1900. We grow and harvest trees, build homes and make a range of forest products essential to everyday lives. We manage our timberland on a sustainable basis in compliance with internationally recognized forestry standards. At the end of 2010, we employed approximately 14,000 employees in 10 countries. We have customers worldwide and generated $6.6 billion in sales in 2010. Our stock trades on the New York Stock exchange under the symbol WY. Additional information about us is available at http://www.weyerhaeuser.com.
EARNINGS CALL INFORMATION
Weyerhaeuser will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on April 29 to discuss first quarter results.
To access the conference call from within North America, dial (877) 296-9413 (access code – 29868744) at least 15 minutes prior to the call. Those calling from outside North America should dial 1-(706) 679-2458 (access code – 29868744). Replays will be available for one week at (800) 642-1687 (access code – 29868744) from within North America and at 1-(706) 645-9291 (access code – 29868744) from outside North America.
The call is being webcast through Weyerhaeuser’s Internet site at http://investor.weyerhaeuser.com and is accessible by selecting the “Q1 2011 Earnings Conference Call” link.
The webcast is available through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at http://www.fulldisclosure.com,
Thomson’s individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson’s password-protected site, StreetEvents (http://www.streetevents.com).
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. These statements are based on various assumptions and may not be accurate because of risks and uncertainties surrounding these assumptions. Factors listed below, as well as other factors, may cause actual results to differ significantly from these forward-looking statements. There is no guarantee that any of the events anticipated by these forward-looking statements will occur. If any of the events occur, there is no guarantee what effect they will have on company operations or financial condition. The company will not update these forward-looking statements after the date of this news release.
Some forward-looking statements discuss the company’s plans, strategies and intentions. They use words such as “expects,” “may,” “will,” “believes,” “should,” “approximately,” “anticipates,” “estimates,” and “plans.” In addition, these words may use the positive or negative or other variations of those terms.
This release contains forward-looking statements regarding the company’s expectations during the second quarter of 2011, including housing market conditions; market challenges for our Timberlands, Wood Products and Real Estate segments; higher selling prices for western logs and higher harvest volumes in Timberlands, partially offset by higher fuel expenses and seasonally higher road and silviculture costs; improved operating rates, higher selling prices and cost reductions in the Wood Products segment, partially offset by increased log costs; higher selling prices, partially offset by increased scheduled maintenance costs in the Cellulose Fiber segment; and a seasonal increase in home sale closings and lower margins and average prices in our single-family homebuilding operations.
Major risks, uncertainties and assumptions that affect the company’s businesses and may cause actual results to differ from these forward-looking statements, include, but are not limited to:
| • | the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages, and strength of the U.S. dollar; |
| • | market demand for the company’s products, which is related to the strength of the various U.S. business segments and economic conditions; |
| • | performance of the company’s manufacturing operations, including maintenance requirements; |
| • | raw material prices; |
| • | energy prices; |
| • | transportation costs; |
| • | the successful execution of internal performance plans, including restructurings and cost reduction initiatives; |
| • | the level of competition from domestic and foreign producers; |
| • | the effect of the Japanese disaster on demand for company products; |
| • | the effect of weather; |
| • | the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters; |
| • | federal tax policies; |
| • | the effect of forestry, land use, environmental and other governmental regulations; |
| • | legal proceedings; |
| • | the effect of timing of retirements and changes in the market price of company stock on charges for stock-based compensation; |
| • | changes in accounting principles; |
| • | performance of pension fund investments and related derivatives; and |
| • | other factors described under “Risk Factors” in the Company’s annual report on Form 10-K. |
The company also is a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan and China. It also is affected by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the euro and the Canadian dollar. Restrictions on international trade or tariffs imposed on imports also may affect the company.
Exhibit 99.2
Weyerhaeuser Company
Q1.2011 Analyst Package
Preliminary results, subject to audit
Consolidated Statement of Operations
| in millions | Q4 | Q1 | ||||||||||
| Dec 31, | March 31, | March 31, | ||||||||||
| 2010 | 2011 | 2010 | ||||||||||
| Net sales and revenues |
$ | 1,664 | $ | 1,578 | $ | 1,419 | ||||||
| Cost of products sold |
1,362 | 1,324 | 1,232 | |||||||||
| Gross margin |
302 | 254 | 187 | |||||||||
| Selling, general and administrative expenses |
178 | 179 | 163 | |||||||||
| Research and development expenses |
10 | 7 | 8 | |||||||||
| Charges for restructuring, closures and impairments |
127 | 4 | 2 | |||||||||
| Other operating income, net |
(66 | ) | (174 | ) | (70 | ) | ||||||
| Operating income |
53 | 238 | 84 | |||||||||
| Interest income and other |
10 | 11 | 42 | |||||||||
| Impairments of investments and other related charges |
(3 | ) | — | — | ||||||||
| Interest expense, net of capitalized interest |
(96 | ) | (93 | ) | (106 | ) | ||||||
| Earnings (loss) before taxes |
(36 | ) | 156 | 20 | ||||||||
| Income tax benefit (provision) |
207 | (57 | ) | (38 | ) | |||||||
| Net earnings (loss) |
171 | 99 | (18 | ) | ||||||||
| Less: net earnings attributable to noncontrolling interests |
— | — | (2 | ) | ||||||||
| Net earnings (loss) attributable to Weyerhaeuser common shareholders |
$ | 171 | $ | 99 | $ | (20 | ) | |||||
| Per Share Information | ||||||||||||
| Q4 | Q1 | |||||||||||
| Dec 31, | March 31, | March 31, | ||||||||||
| 2010 | 2011 | 2010 | ||||||||||
| Basic earnings (loss) per share attributable to Weyerhaeuser common shareholders |
$ | 0.32 | $ | 0.18 | $ | (0.10 | ) | |||||
| Diluted earnings (loss) per share attributable to Weyerhaeuser common shareholders |
$ | 0.32 | $ | 0.18 | $ | (0.10 | ) | |||||
| Dividends paid per share |
$ | 0.05 | $ | 0.15 | $ | 0.05 | ||||||
| Weighted average shares outstanding (in thousands): |
||||||||||||
| Basic |
535,956 | 537,140 | 211,440 | |||||||||
| Diluted |
538,376 | 540,476 | 211,440 | |||||||||
| Common shares outstanding at end of period (in thousands) |
535,976 | 538,408 | 211,557 | |||||||||
Page 1 of 9
Weyerhaeuser Company
Q1.2011 Analyst Package
Preliminary results, subject to audit
Consolidated Balance Sheet
| in millions | March
31, 2011 |
Dec 31, 2010 |
||||||
| Assets |
||||||||
| Forest Products |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 1,459 | $ | 1,466 | ||||
| Receivables, less allowances |
505 | 451 | ||||||
| Inventories |
544 | 478 | ||||||
| Prepaid expenses |
85 | 81 | ||||||
| Deferred tax assets |
155 | 113 | ||||||
| Total current assets |
2,748 | 2,589 | ||||||
| Property and equipment, net |
3,151 | 3,217 | ||||||
| Construction in progress |
149 | 123 | ||||||
| Timber and timberlands at cost, less depletion charged to disposals |
4,003 | 4,035 | ||||||
| Investments in and advances to equity affiliates |
192 | 194 | ||||||
| Goodwill |
40 | 40 | ||||||
| Other assets |
424 | 363 | ||||||
| Restricted assets held by special purpose entities |
914 | 915 | ||||||
| 11,621 | 11,476 | |||||||
| Real Estate |
||||||||
| Cash and cash equivalents |
4 | 1 | ||||||
| Receivables, less allowances |
54 | 51 | ||||||
| Real estate in process of development and for sale |
515 | 517 | ||||||
| Land being processed for development |
978 | 974 | ||||||
| Investments in and advances to equity affiliates |
15 | 16 | ||||||
| Deferred tax assets |
266 | 266 | ||||||
| Other assets |
119 | 120 | ||||||
| Consolidated assets not owned |
8 | 8 | ||||||
| 1,959 | 1,953 | |||||||
| Total assets |
$ | 13,580 | $ | 13,429 | ||||
| Liabilities |
||||||||
| Forest Products |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 359 | $ | 340 | ||||
| Accrued liabilities |
686 | 734 | ||||||
| Total current liabilities |
1,045 | 1,074 | ||||||
| Long-term debt |
4,710 | 4,710 | ||||||
| Deferred income taxes |
485 | 366 | ||||||
| Deferred pension and other postretirement benefits |
908 | 930 | ||||||
| Other liabilities |
405 | 393 | ||||||
| Liabilities (nonrecourse to Weyerhaeuser) held by special purpose entities |
771 | 772 | ||||||
| 8,324 | 8,245 | |||||||
| Real Estate |
||||||||
| Long-term debt |
348 | 350 | ||||||
| Other liabilities |
196 | 212 | ||||||
| Consolidated liabilities not owned |
8 | 8 | ||||||
| 552 | 570 | |||||||
| Total liabilities |
8,876 | 8,815 | ||||||
| Equity |
||||||||
| Total Weyerhaeuser shareholders’ interest |
4,702 | 4,612 | ||||||
| Noncontrolling interests |
2 | 2 | ||||||
| Total equity |
4,704 | 4,614 | ||||||
| Total liabilities and equity |
$ | 13,580 | $ | 13,429 | ||||
Page 2 of 9
Weyerhaeuser Company
Q1.2011 Analyst Package
Preliminary results, subject to audit
Consolidated Statement of Cash Flows
| in millions | Q4 | Q1 | ||||||||||
| Dec 31, | March 31, | March 31, | ||||||||||
| 2010 | 2011 | 2010 | ||||||||||
| Cash flows from operations: |
||||||||||||
| Net earnings (loss) |
$ | 171 | $ | 99 | $ | (18 | ) | |||||
| Noncash charges (credits) to income (loss): |
||||||||||||
| Depreciation, depletion and amortization |
127 | 123 | 126 | |||||||||
| Deferred income taxes, net |
(341 | ) | 39 | 34 | ||||||||
| Pension and other postretirement benefits |
(2 | ) | 24 | (1 | ) | |||||||
| Share-based compensation expense |
8 | 14 | 6 | |||||||||
| Equity in loss of equity affiliates |
3 | 2 | 3 | |||||||||
| Charges for impairment of assets |
112 | 1 | 2 | |||||||||
| Net gains on dispositions of assets and operations |
(46 | ) | (156 | ) | (83 | ) | ||||||
| Foreign exchange transaction gains |
(4 | ) | (7 | ) | (10 | ) | ||||||
| Decrease (increase) in working capital: |
||||||||||||
| Receivables less allowances |
36 | (59 | ) | (87 | ) | |||||||
| Receivable for taxes |
62 | 1 | 568 | |||||||||
| Inventories |
2 | (66 | ) | (65 | ) | |||||||
| Real estate and land |
48 | (2 | ) | (36 | ) | |||||||
| Prepaid expenses |
14 | (10 | ) | (13 | ) | |||||||
| Accounts payable and accrued liabilities |
(44 | ) | (78 | ) | (47 | ) | ||||||
| Deposits on land positions and other assets |
3 | — | 3 | |||||||||
| Pension contributions |
(27 | ) | (1 | ) | (132 | ) | ||||||
| Other |
87 | (33 | ) | (72 | ) | |||||||
| Net cash from operations |
209 | (109 | ) | 178 | ||||||||
| Cash flows from investing activities: |
||||||||||||
| Property and equipment |
(79 | ) | (35 | ) | (46 | ) | ||||||
| Timberlands reforestation |
(10 | ) | (12 | ) | (13 | ) | ||||||
| Redemption of short-term investments |
2 | — | 47 | |||||||||
| Proceeds from sale of assets and operations |
53 | 193 | 115 | |||||||||
| Repayments from pension trust |
— | — | 50 | |||||||||
| Other |
(17 | ) | 5 | (3 | ) | |||||||
| Cash from investing activities |
(51 | ) | 151 | 150 | ||||||||
| Cash flows from financing activities: |
||||||||||||
| Notes, commercial paper borrowings and revolving credit facilities, net |
(1 | ) | — | (3 | ) | |||||||
| Cash dividends |
(27 | ) | (81 | ) | (11 | ) | ||||||
| Change in book overdrafts |
33 | 3 | (4 | ) | ||||||||
| Payments on debt |
(65 | ) | (2 | ) | (17 | ) | ||||||
| Exercises of stock options |
— | 34 | — | |||||||||
| Other |
1 | — | (2 | ) | ||||||||
| Cash from financing activities |
(59 | ) | (46 | ) | (37 | ) | ||||||
| Net change in cash and cash equivalents |
99 | (4 | ) | 291 | ||||||||
| Cash and cash equivalents at beginning of period |
1,368 | 1,467 | 1,869 | |||||||||
| Cash and cash equivalents at end of period |
$ | 1,467 | $ | 1,463 | $ | 2,160 | ||||||
| Cash paid (received) during the year for: |
||||||||||||
| Interest, net of amount capitalized |
$ | 57 | $ | 156 | $ | 153 | ||||||
| Income taxes |
$ | (9 | ) | $ | 2 | $ | (444 | ) | ||||
Page 3 of 9
| Weyerhaeuser Company Q1.2011 Analyst Package Preliminary results, subject to audit |
Total Company Statistics |
Special Items Included in Net Earnings
| in millions | Q4 | Q1 | ||||||||||
| Dec 31, | March 31, | March 31, | ||||||||||
| 2010 | 2011 | 2010 | ||||||||||
| Net earnings (loss) |
$ | 171 | $ | 99 | $ | (20 | ) | |||||
| Income tax adjustments |
(177 | ) | — | 31 | ||||||||
| Gain on sale of wood products assets |
— | — | (26 | ) | ||||||||
| Gain on sale of railroads |
(31 | ) | — | — | ||||||||
| Gain on sale of 82,000 acres of non-strategic timberlands |
— | (96 | ) | — | ||||||||
| Charges for closures, restructuring and impairments |
89 | — | — | |||||||||
| Net earnings (loss) before special items |
$ | 52 | $ | 3 | $ | (15 | ) | |||||
| Q4 | Q1 | |||||||||||
| Dec 31, | March 31, | March 31, | ||||||||||
| 2010 | 2011 | 2010 | ||||||||||
| Net earnings (loss) per diluted share |
$ | 0.32 | $ | 0.18 | $ | (0.10 | ) | |||||
| Income tax adjustments |
(0.33 | ) | — | 0.15 | ||||||||
| Gain on sale of wood products assets |
— | — | (0.12 | ) | ||||||||
| Gain on sale of railroads |
(0.06 | ) | — | — | ||||||||
| Gain on sale of 82,000 acres of non-strategic timberlands |
— | (0.18 | ) | — | ||||||||
| Charges for closures, restructuring and impairments |
0.17 | — | — | |||||||||
| Net earnings (loss) before special items per diluted share |
$ | 0.10 | $ | — | $ | (0.07 | ) | |||||
| Selected Total Company Items | ||||||||||||
| in millions | Q4 | Q1 | ||||||||||
| Dec 31, | March 31, | March 31, | ||||||||||
| 2010 | 2011 | 2010 | ||||||||||
| Depreciation, depletion and amortization: |
||||||||||||
| Cost of products sold |
$ | 112 | $ | 107 | $ | 110 | ||||||
| Selling, general and administrative expenses |
15 | 16 | 16 | |||||||||
| Total depreciation, depletion and amortization |
$ | 127 | $ | 123 | $ | 126 | ||||||
| Pension and postretirement credits (costs): |
||||||||||||
| Pension and postretirement costs allocated to business segments |
$ | (12 | ) | $ | (12 | ) | $ | (12 | ) | |||
| Pension and postretirement credits (costs) retained by Corporate segment |
19 | (12 | ) | 16 | ||||||||
| Total company pension and postretirement credits (costs) |
$ | 7 | $ | (24 | ) | $ | 4 | |||||
| Total decrease (increase) in Forest Products working capital |
$ | 98 | $ | (196 | ) | $ | 169 | |||||
| Cash spent for capital expenditures |
$ | (89 | ) | $ | (47 | ) | $ | (59 | ) | |||
Page 4 of 9
| Weyerhaeuser Company Q1.2011 Analyst Package Preliminary results, subject to audit |
Timberlands Segment |
Segment Statement of Operations
| in millions | Q4.2010 | Q1.2011 | Q1.2010 | |||||||||
| Trade sales and revenues (unaffiliated customers) |
$ | 207 | $ | 230 | $ | 202 | ||||||
| Intersegment sales |
164 | 191 | 171 | |||||||||
| Total net sales and revenues |
371 | 421 | 373 | |||||||||
| Cost of products sold |
298 | 320 | 277 | |||||||||
| Gross margin |
73 | 101 | 96 | |||||||||
| Selling, general and administrative expenses |
22 | 23 | 20 | |||||||||
| Research and development expenses |
7 | 4 | 4 | |||||||||
| Charges for restructuring, closures and impairments |
— | — | 1 | |||||||||
| Other operating income, net |
(11 | ) | (166 | ) | (10 | ) | ||||||
| Operating income |
55 | 240 | 81 | |||||||||
| Interest income and other |
1 | 1 | — | |||||||||
| Net contribution to earnings |
$ | 56 | $ | 241 | $ | 81 | ||||||
Selected Segment Items
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Depreciation, depletion and amortization |
$ | 30 | $ | 31 | $ | 30 | ||||||
| Total increase in working capital |
$ | (4 | ) | $ | (17 | ) | $ | (15 | ) | |||
| Cash spent for capital expenditures |
$ | (20 | ) | $ | (14 | ) | $ | (20 | ) | |||
Segment Special Items Included in Net Contribution to Earnings (Pre-Tax)
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Gain on sale of 82,000 acres of non-strategic timberlands |
$ | — | $ | 152 | $ | — | ||||||
Segment Statistics
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||||
| Third Party Net Sales and Revenue (millions) |
Logs: | |||||||||||||
| West |
$ | 97 | $ | 110 | $ | 82 | ||||||||
| South |
41 | 41 | 27 | |||||||||||
| Canada |
5 | 7 | 9 | |||||||||||
| Total Logs | 143 | 158 | 118 | |||||||||||
| Pay as cut timber sales | 8 | 8 | 8 | |||||||||||
| Timberlands exchanges and dispositions | 20 | 21 | 35 | |||||||||||
| Higher and better use land sales | 4 | 4 | 5 | |||||||||||
| Minerals, oil and gas | 14 | 14 | 15 | |||||||||||
| Products from international operations | 16 | 17 | 15 | |||||||||||
| Other products | 2 | 8 | 6 | |||||||||||
| Total | $ | 207 | $ | 230 | $ | 202 | ||||||||
| Logs Third Party Sales Realizations (per cubic meter) |
West | $ | 95.30 | $ | 100.20 | $ | 84.17 | |||||||
| South | $ | 41.86 | $ | 41.22 | $ | 43.21 | ||||||||
| Canada | $ | 33.84 | $ | 34.73 | $ | 34.02 | ||||||||
| International | $ | 18.21 | $ | 18.61 | $ | 20.35 | ||||||||
| Logs Third Party Sales Volumes (cubic meters, thousands) |
West | 1,020 | 1,095 | 975 | ||||||||||
| South | 993 | 1,005 | 634 | |||||||||||
| Canada | 141 | 194 | 259 | |||||||||||
| International | 74 | 72 | 78 | |||||||||||
| Total | 2,228 | 2,366 | 1,946 | |||||||||||
| Logs Fee Depletion (cubic meters, thousands) |
West | 1,290 | 1,611 | 1,431 | ||||||||||
| South | 2,116 | 2,180 | 2,140 | |||||||||||
| International | 79 | 98 | 92 | |||||||||||
| Total | 3,485 | 3,889 | 3,663 | |||||||||||
Page 5 of 9
| Weyerhaeuser Company Q1.2011 Analyst Package Preliminary results, subject to audit |
Wood Products Segment |
Segment Statement of Operations
| in millions | Q4.2010 | Q1.2011 | Q1.2010 | |||||||||
| Trade sales and revenues (unaffiliated customers) |
$ | 572 | $ | 624 | $ | 604 | ||||||
| Intersegment sales |
18 | 21 | 16 | |||||||||
| Total net sales and revenues |
590 | 645 | 620 | |||||||||
| Cost of products sold |
613 | 630 | 616 | |||||||||
| Gross margin |
(23 | ) | 15 | 4 | ||||||||
| Selling, general and administrative expenses |
63 | 55 | 68 | |||||||||
| Research and development expenses |
1 | 1 | 1 | |||||||||
| Charges for restructuring, closures and impairments |
103 | 2 | 1 | |||||||||
| Other operating income, net |
(1 | ) | (5 | ) | (46 | ) | ||||||
| Operating loss |
(189 | ) | (38 | ) | (20 | ) | ||||||
| Interest income and other |
1 | 2 | 1 | |||||||||
| Net contribution to earnings |
$ | (188 | ) | $ | (36 | ) | $ | (19 | ) | |||
Selected Segment Items
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Depreciation, depletion and amortization |
$ | 43 | $ | 40 | $ | 45 | ||||||
| Total decrease (increase) in working capital |
$ | 40 | $ | (118 | ) | $ | (134 | ) | ||||
| Cash spent for capital expenditures |
$ | (21 | ) | $ | (6 | ) | $ | (2 | ) | |||
Segment Special Items Included in Net Contribution to Earnings (Pre-Tax)
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Gain on sale of assets |
$ | — | $ | — | $ | 44 | ||||||
| Charges for restructuring, closures and impairments |
(103 | ) | — | — | ||||||||
| Total |
$ | (103 | ) | $ | — | $ | 44 | |||||
Segment Statistics
| in millions, except for third-party sales realizations | Q4.2010 | Q1.2011 | Q1.2010 | |||||||||||
| Structural Lumber (board feet) |
Third Party Net Sales and Revenue |
$ | 241 | $ | 260 | $ | 241 | |||||||
| Third Party Sales Realizations |
$ | 292.63 | $ | 315.26 | $ | 316.60 | ||||||||
| Third Party Sales Volumes |
822 | 826 | 761 | |||||||||||
| Production Volumes |
785 | 893 | 801 | |||||||||||
| Engineered Solid Section (cubic feet) |
Third Party Net Sales and Revenue |
$ | 59 | $ | 62 | $ | 66 | |||||||
| Third Party Sales Realizations |
$ | 1,853.91 | $ | 1,851.05 | $ | 1,718.25 | ||||||||
| Third Party Sales Volumes |
3 | 3 | 4 | |||||||||||
| Production Volumes |
3 | 4 | 4 | |||||||||||
| Engineered I-joists (lineal feet) |
Third Party Net Sales and Revenue |
$ | 35 | $ | 33 | $ | 48 | |||||||
| Third Party Sales Realizations |
$ | 1,259.46 | $ | 1,266.51 | $ | 1,083.79 | ||||||||
| Third Party Sales Volumes |
29 | 26 | 44 | |||||||||||
| Production Volumes |
26 | 30 | 41 | |||||||||||
| Oriented Strand Board (square feet 3/8’) |
Third Party Net Sales and Revenue |
$ | 72 | $ | 85 | $ | 66 | |||||||
| Third Party Sales Realizations |
$ | 177.84 | $ | 192.16 | $ | 197.46 | ||||||||
| Third Party Sales Volumes |
408 | 445 | 334 | |||||||||||
| Production Volumes |
429 | 494 | 378 | |||||||||||
| Softwood Plywood (square feet 3/8’) | Third Party Net Sales and Revenue |
$ | 15 | $ | 17 | $ | 16 | |||||||
| Third Party Sales Realizations |
$ | 250.61 | $ | 263.83 | $ | 263.54 | ||||||||
| Third Party Sales Volumes |
57 | 63 | 60 | |||||||||||
| Production Volumes |
43 | 53 | 48 | |||||||||||
| Hardwood Lumber (square feet 3/8’) | Third Party Net Sales and Revenue |
$ | 51 | $ | 58 | $ | 54 | |||||||
| Third Party Sales Realizations |
$ | 833.75 | $ | 845.42 | $ | 814.00 | ||||||||
| Third Party Sales Volumes |
61 | 69 | 67 | |||||||||||
| Production Volumes |
51 | 58 | 59 | |||||||||||
Page 6 of 9
| Weyerhaeuser Company Q1.2011 Analyst Package Preliminary results, subject to audit |
Cellulose Fibers Segment |
Segment Statement of Operations
| in millions | Q4.2010 | Q1.2011 | Q1.2010 | |||||||||
| Total net sales and revenues |
$ | 511 | $ | 506 | $ | 410 | ||||||
| Cost of products sold |
356 | 400 | 367 | |||||||||
| Gross margin |
155 | 106 | 43 | |||||||||
| Selling, general and administrative expenses |
21 | 22 | 20 | |||||||||
| Research and development expenses |
2 | 2 | 2 | |||||||||
| Other operating income, net |
(7 | ) | (5 | ) | (2 | ) | ||||||
| Operating income |
139 | 87 | 23 | |||||||||
| Interest income and other |
(1 | ) | (1 | ) | (4 | ) | ||||||
| Net contribution to earnings |
$ | 138 | $ | 86 | $ | 19 | ||||||
Selected Segment Items
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Depreciation, depletion and amortization |
$ | 39 | $ | 36 | $ | 36 | ||||||
| Total decrease (increase) in working capital |
$ | 21 | $ | 21 | $ | (10 | ) | |||||
| Cash spent for capital expenditures |
$ | (46 | ) | $ | (26 | ) | $ | (35 | ) | |||
Segment Statistics
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||||
| Pulp (air-dry metric tons) |
Third Party Net Sales and Revenue (millions) |
$ | 402 | $ | 398 | $ | 321 | |||||||
| Third Party Sales Realizations |
$ | 926.29 | $ | 912.12 | $ | 761.78 | ||||||||
| Third Party Sales Volumes (thousands) |
434 | 436 | 422 | |||||||||||
| Production Volumes (thousands) |
453 | 437 | 437 | |||||||||||
| Liquid Packaging Board (tons) |
Third Party Net Sales and Revenue (millions) |
$ | 88 | $ | 85 | $ | 71 | |||||||
| Third Party Sales Realizations |
$ | 1,081.52 | $ | 1,148.29 | $ | 1,051.81 | ||||||||
| Third Party Sales Volumes (thousands) |
81 | 74 | 67 | |||||||||||
| Production Volumes (thousands) |
84 | 67 | 69 | |||||||||||
Page 7 of 9
| Weyerhaeuser Company Q1.2011 Analyst Package Preliminary results, subject to audit |
Real Estate Segment |
Segment Statement of Operations
| in millions | Q4.2010 | Q1.2011 | Q1.2010 | |||||||||
| Total net sales and revenues |
$ | 305 | $ | 160 | $ | 151 | ||||||
| Cost of products sold |
228 | 126 | 121 | |||||||||
| Gross margin |
77 | 34 | 30 | |||||||||
| Selling, general and administrative expenses |
45 | 35 | 34 | |||||||||
| Charges for restructuring, closures and impairments |
17 | 1 | 1 | |||||||||
| Other operating (income) loss, net |
(1 | ) | — | 1 | ||||||||
| Operating income (loss) |
16 | (2 | ) | (6 | ) | |||||||
| Interest income and other |
— | 1 | 39 | |||||||||
| Impairments of investments and other related charges |
(3 | ) | — | — | ||||||||
| Loss attributable to noncontrolling interests |
— | — | (2 | ) | ||||||||
| Net contribution to earnings |
$ | 13 | $ | (1 | ) | $ | 31 | |||||
| Selected Segment Items | ||||||||||||
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Depreciation and amortization |
$ | 4 | $ | 3 | $ | 3 | ||||||
| Cash spent for capital expenditures |
$ | (2 | ) | $ | (1 | ) | $ | (1 | ) | |||
| Segment Special Items Included in Net Contribution to Earnings (Pre-Tax) | ||||||||||||
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Charges for restructuring, closures and impairments |
$ | (20 | ) | $ | — | $ | — | |||||
| Segment Statistics | ||||||||||||
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Net sales and revenues: |
||||||||||||
| Single-family housing |
$ | 266 | $ | 152 | $ | 143 | ||||||
| Land |
25 | 7 | 7 | |||||||||
| Other |
14 | 1 | 1 | |||||||||
| Total net sales and revenue |
$ | 305 | $ | 160 | $ | 151 | ||||||
| Single-family homes sold |
385 | 535 | 620 | |||||||||
| Single-family homes closed |
606 | 363 | 393 | |||||||||
| Single-family homes sold but not closed (backlog) |
439 | 611 | 877 | |||||||||
| Single-family average price of homes closed (in thousands) |
$ | 439 | $ | 419 | $ | 365 | ||||||
| Single-family home gross margin - excluding impairments (1) |
26.1 | % | 21.7 | % | 19.4 | % | ||||||
| (1) | Single-family gross margin excluding impairments equals revenue less cost of sales and period costs (other than impairments and deposit write-offs). |
Page 8 of 9
| Weyerhaeuser Company Q1.2011 Analyst Package Preliminary results, subject to audit |
Corporate & Other Segment |
Segment Statement of Operations
| in millions | Q4.2010 | Q1.2011 | Q1.2010 | |||||||||
| Trade sales and revenues (unaffiliated customers) |
$ | 69 | $ | 58 | $ | 52 | ||||||
| Intersegment sales |
5 | 3 | 4 | |||||||||
| Total net sales and revenues |
74 | 61 | 56 | |||||||||
| Cost of products sold |
54 | 63 | 42 | |||||||||
| Gross margin |
20 | (2 | ) | 14 | ||||||||
| Selling, general and administrative expenses |
27 | 44 | 21 | |||||||||
| Research and development expenses |
— | — | 1 | |||||||||
| Charges for restructuring, closures and impairments |
6 | 1 | (1 | ) | ||||||||
| Other operating (income) loss, net |
(45 | ) | 2 | (13 | ) | |||||||
| Operating income (loss) |
32 | (49 | ) | 6 | ||||||||
| Interest income and other |
9 | 8 | 6 | |||||||||
| Net contribution to earnings |
$ | 41 | $ | (41 | ) | $ | 12 | |||||
| Selected Segment Items | ||||||||||||
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Depreciation, depletion and amortization |
$ | 11 | $ | 13 | $ | 12 | ||||||
| Total decrease (increase) in working capital |
$ | 41 | $ | (82 | ) | $ | 328 | |||||
| Cash spent for capital expenditures |
$ | — | $ | — | $ | (1 | ) | |||||
| Share-based compensation expense |
$ | 8 | $ | 16 | $ | 3 | ||||||
| Foreign exchange gains |
$ | 4 | $ | 6 | $ | 9 | ||||||
| Pension and postretirement credits (costs) retained by Corporate segment |
$ | 19 | $ | (12 | ) | $ | 16 | |||||
| Segment Special Items Included in Net Contribution to Earnings (Pre-Tax) | ||||||||||||
| Q4.2010 | Q1.2011 | Q1.2010 | ||||||||||
| Charges for restructuring, closures and impairments |
$ | (7 | ) | $ | — | $ | — | |||||
| Gain on sale of railroads |
46 | — | — | |||||||||
| Total |
$ | 39 | $ | — | $ | — | ||||||
Corporate and Other includes results of our transportation operations, certain gains or charges that are not related to an individual operating segment and the portion of items such as share-based compensation, pension and postretirement costs, foreign exchange transaction gains and losses and other general and administrative expenses that are not allocated to the business segments. We sold our five short line railroads at the end of 2010 and transportation currently only consists of Westwood Shipping Lines.
Page 9 of 9