wy-ex992_7.htm

Weyerhaeuser Company

Exhibit 99.2

Q2.2019 Analyst Package

Preliminary results (unaudited)

Consolidated Statement of Operations

	Q1			Q2						Year-to-Date
in millions	March 31, 2019			June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Net sales	$	1,643		$	1,692		$	2,065		$	3,335		$	3,930
Costs of sales		1,322			1,390			1,447			2,712			2,795
Gross margin		321			302			618			623			1,135
Selling expenses		21			21			23			42			46
General and administrative expenses		89			80			80			169			158
Research and development expenses		1			2			2			3			4
Other operating costs, net		36			13			37			49			47
Operating income		174			186			476			360			880
Non-operating pension and other postretirement benefit costs		(470	)		(10	)		(13	)		(480	)		(37	)
Interest income and other		10			6			11			16			23
Interest expense, net of capitalized interest		(107	)		(91	)		(92	)		(198	)		(185	)
Earnings (loss) before income taxes		(393	)		91			382			(302	)		681
Income taxes		104			37			(65	)		141			(95	)
Net earnings (loss)	$	(289	)	$	128		$	317		$	(161	)	$	586

Per Share Information

	Q1			Q2				Year-to-Date
	March 31, 2019			June 30, 2019		June 30, 2018		June 30, 2019			June 30, 2018
Earnings (loss) per share, basic and diluted	$	(0.39	)	$	0.17	$	0.42	$	(0.22	)	$	0.77
Dividends paid per common share	$	0.34		$	0.34	$	0.32	$	0.68		$	0.64
Weighted average shares outstanding (in thousands):
Basic		746,603			745,486		757,829		746,041			757,317
Diluted		746,603			746,232		760,533		746,041			759,992
Common shares outstanding at end of period (in thousands)		744,767			744,905		757,646		744,905			757,646

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

	Q1			Q2						Year-to-Date
in millions	March 31, 2019			June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Net earnings (loss)	$	(289	)	$	128		$	317		$	(161	)	$	586
Non-operating pension and other postretirement benefit costs		470			10			13			480			37
Interest income and other		(10	)		(6	)		(11	)		(16	)		(23	)
Interest expense, net of capitalized interest		107			91			92			198			185
Income taxes		(104	)		(37	)		65			(141	)		95
Operating income		174			186			476			360			880
Depreciation, depletion and amortization		123			124			119			247			239
Basis of real estate sold		48			33			22			81			34
Special items included in operating income		20			—			20			20			28
Adjusted EBITDA⁽¹⁾	$	365		$	343		$	637		$	708		$	1,181

⁽¹⁾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, 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

Q2.2019 Analyst Package

Preliminary results (unaudited)

Special Items Included in Net Earnings (Income Tax Affected)

	Q1			Q2					Year-to-Date
in millions	March 31, 2019			June 30, 2019			June 30, 2018		June 30, 2019			June 30, 2018
Net earnings (loss)	$	(289	)	$	128		$	317	$	(161	)	$	586
Early extinguishment of debt charge⁽¹⁾		9			—			—		9			—
Environmental remediation charge		—			—			—		—			21
Legal charge		15			—			—		15			—
Pension settlement charges		345			(5	)		—		340			—
Product remediation charges (recoveries), net		—			—			15		—			—
Net earnings before special items⁽²⁾	$	80		$	123		$	332	$	203		$	607

	Q1			Q2					Year-to-Date
	March 31, 2019			June 30, 2019			June 30, 2018		June 30, 2019			June 30, 2018
Net earnings (loss) per diluted share	$	(0.39	)	$	0.17		$	0.42	$	(0.22	)	$	0.77
Early extinguishment of debt charge⁽¹⁾		0.01			—			—		0.01			—
Environmental remediation charge		—			—			—		—			0.03
Legal charge		0.02			—			—		0.02			—
Pension settlement charges		0.47			(0.01	)		—		0.46			—
Product remediation charges (recoveries), net		—			—			0.02		—			—
Net earnings per diluted share before special items⁽²⁾	$	0.11		$	0.16		$	0.44	$	0.27		$	0.80

⁽¹⁾ During first quarter 2019, we recorded a $12 million pretax ($9 million after-tax) charge related to the early extinguishment of debt. This charge is included in Interest expense, net of capitalized interest in the Consolidated Statement of Operations.

⁽²⁾ Net Earnings before special items is a non-GAAP measure that management believes provides helpful context in understanding the company’s earnings performance. Net Earnings before special items should not be considered in isolation from and is not intended to represent an alternative to our GAAP results.

Selected Total Company Items

	Q1		Q2				Year-to-Date
in millions	March 31, 2019		June 30, 2019		June 30, 2018		June 30, 2019		June 30, 2018
Pension and postretirement costs:
Pension and postretirement service costs	$	8	$	8	$	8	$	16	$	18
Non-operating pension and other postretirement benefit costs		470		10		13		480		37
Total company pension and postretirement costs	$	478	$	18	$	21	$	496	$	55

Page 2 of 8

Weyerhaeuser Company

Q2.2019 Analyst Package

Preliminary results (unaudited)

Consolidated Balance Sheet

in millions	March 31, 2019		June 30, 2019		December 31, 2018
ASSETS
Current assets:
Cash and cash equivalents	$	259	$	212	$	334
Receivables, less discounts and allowances		398		408		337
Receivables for taxes		163		157		137
Inventories		451		425		389
Prepaid expenses and other current assets		141		132		152
Current restricted financial investments held by variable interest entities		362		362		253
Total current assets		1,774		1,696		1,602
Property and equipment, net		1,917		1,901		1,857
Construction in progress		102		134		136
Timber and timberlands at cost, less depletion		12,586		12,516		12,671
Minerals and mineral rights, less depletion		291		288		294
Deferred tax assets		18		33		15
Other assets		444		461		312
Restricted financial investments held by variable interest entities		—		—		362
Total assets	$	17,132	$	17,029	$	17,249

LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt	$	—	$	—	$	500
Current debt (nonrecourse to the company) held by variable interest entities		302		302		302
Borrowings on line of credit		245		140		425
Accounts payable		243		271		222
Accrued liabilities		411		510		490
Total current liabilities		1,201		1,223		1,939
Long-term debt		6,156		6,153		5,419
Deferred tax liabilities		34		17		43
Deferred pension and other postretirement benefits		542		515		527
Other liabilities		398		397		275
Total liabilities		8,331		8,305		8,203
Total equity		8,801		8,724		9,046
Total liabilities and equity	$	17,132	$	17,029	$	17,249

Page 3 of 8

Weyerhaeuser Company

Q2.2019 Analyst Package

Preliminary results (unaudited)

Consolidated Statement of Cash Flows

	Q1			Q2						Year-to-Date
in millions	March 31, 2019			June 30, 2019			June 30, 2018			June 30, 2019			June 30, 2018
Cash flows from operations:
Net earnings (loss)	$	(289	)	$	128		$	317		$	(161	)	$	586
Noncash charges to earnings (loss):
Depreciation, depletion and amortization		123			124			119			247			239
Basis of real estate sold		48			33			22			81			34
Deferred income taxes, net		(123	)		(43	)		15			(166	)		25
Pension and other postretirement benefits		478			18			21			496			55
Share-based compensation expense		9			7			9			16			18
Change in:
Receivables, less allowances		(77	)		(10	)		(18	)		(87	)		(101	)
Receivables and payables for taxes		(31	)		6			10			(25	)		15
Inventories		(60	)		28			30			(32	)		(36	)
Prepaid expenses and other current assets		(5	)		8			4			3			(1	)
Accounts payable and accrued liabilities		(82	)		127			103			45			(70	)
Pension and postretirement benefit contributions and payments		(14	)		(13	)		(16	)		(27	)		(32	)
Other		9			(17	)		(19	)		(8	)		1
Net cash from (used in) operations	$	(14	)	$	396		$	597		$	382		$	733
Cash flows from investing activities:
Capital expenditures for property and equipment	$	(41	)	$	(71	)	$	(83	)	$	(112	)	$	(144	)
Capital expenditures for timberlands reforestation		(18	)		(13	)		(14	)		(31	)		(34	)
Proceeds from note receivable held by variable interest entities		253			—			—			253			—
Other		18			1			24			19			29
Net cash from (used in) investing activities	$	212		$	(83	)	$	(73	)	$	129		$	(149	)
Cash flows from financing activities:
Cash dividends on common shares	$	(254	)	$	(253	)	$	(243	)	$	(507	)	$	(485	)
Net proceeds from issuance of long-term debt		739			—			—			739			—
Payments of long-term debt		(512	)		—			—			(512	)		(62	)
Proceeds from borrowing on line of credit		245			140			—			385			—
Payments on line of credit		(425	)		(245	)		—			(670	)		—
Proceeds from exercise of stock options		2			2			23			4			48
Repurchases of common shares		(60	)		—			—			(60	)		—
Other		(8	)		(4	)		(1	)		(12	)		(8	)
Net cash used in financing activities	$	(273	)	$	(360	)	$	(221	)	$	(633	)	$	(507	)

Net change in cash and cash equivalents	$	(75	)	$	(47	)	$	303		$	(122	)	$	77
Cash and cash equivalents at beginning of period		334			259			598			334			824
Cash and cash equivalents at end of period	$	259		$	212		$	901		$	212		$	901

Cash paid during the period for:
Interest, net of amount capitalized	$	127		$	59		$	67		$	186		$	172
Income taxes	$	50		$	1		$	41		$	51		$	58

Page 4 of 8

Weyerhaeuser Company

Timberlands Segment

Q2.2019 Analyst Package

Preliminary results (unaudited)

Segment Statement of Operations⁽¹⁾

in millions	Q1.2019			Q2.2019			Q2.2018			YTD.2019			YTD.2018
Sales to unaffiliated customers	$	431		$	401		$	476		$	832		$	966
Intersegment sales		125			131			139			256			281
Total net sales		556			532			615			1,088			1,247
Costs of sales		413			405			431			818			853
Gross margin		143			127			184			270			394
Selling expenses		1			—			—			1			1
General and administrative expenses		22			25			24			47			46
Research and development expenses		1			1			1			2			3
Other operating income, net		(1	)		(1	)		(2	)		(2	)		(6	)
Operating income and Net contribution to earnings	$	120		$	102		$	161		$	222		$	350

⁽¹⁾ In January 2019, we changed the way we report our Canadian Forestlands operations, which are primarily operated to supply Weyerhaeuser’s Canadian Wood Products manufacturing facilities. As a result, we no longer report related intersegment sales in the Timberlands segment and we will now record the minimal associated third-party log sales in the Wood Products segment. These collective transactions did not contribute any earnings to the Timberlands segment. We have conformed prior year presentations with the current year.

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization⁽²⁾

in millions	Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Operating income	$	120	$	102	$	161	$	222	$	350
Depreciation, depletion and amortization		73		73		79		146		158
Adjusted EBITDA⁽²⁾	$	193	$	175	$	240	$	368	$	508

⁽²⁾See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

Selected Segment Items

in millions	Q1.2019			Q2.2019			Q2.2018			YTD.2019			YTD.2018
Total decrease (increase) in working capital⁽³⁾	$	(24	)	$	46		$	70		$	22		$	30
Cash spent for capital expenditures	$	(26	)	$	(25	)	$	(29	)	$	(51	)	$	(57	)

⁽³⁾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⁽⁴⁾

		Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Third Party	Delivered logs:
Net Sales	West	$	205	$	194	$	262	$	399	$	528
(millions)	South		159		156		158		315		315
	North		29		17		20		46		45
	Total delivered logs		393		367		440		760		888
	Stumpage and pay-as-cut timber		9		10		11		19		26
	Recreational and other lease revenue		15		15		14		30		28
	Other revenue		14		9		11		23		24
	Total	$	431	$	401	$	476	$	832	$	966
Delivered Logs	West	$	106.92	$	104.07	$	132.24	$	105.52	$	131.91
Third Party Sales	South	$	35.35	$	35.45	$	34.55	$	35.40	$	34.69
Realizations (per ton)	North	$	59.68	$	62.10	$	64.92	$	60.52	$	62.59
Delivered Logs	West		1,920		1,864		1,984		3,784		4,003
Third Party Sales	South		4,499		4,400		4,560		8,899		9,070
Volumes (tons, thousands)	North		494		263		313		757		717
Fee Harvest Volumes	West		2,385		2,455		2,360		4,840		4,803
(tons, thousands)	South		6,492		6,367		6,630		12,859		13,381
	North		627		378		423		1,005		972

⁽⁴⁾ 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 & Natural Resources Segment

Q2.2019 Analyst Package

Preliminary results (unaudited)

Segment Statement of Operations

in millions	Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Net sales	$	118	$	81	$	58	$	199	$	109
Costs of sales		56		39		30		95		49
Gross margin		62		42		28		104		60
General and administrative expenses		7		7		6		14		13
Operating income and Net contribution to earnings	$	55	$	35	$	22	$	90	$	47

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization⁽¹⁾

in millions	Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Operating income	$	55	$	35	$	22	$	90	$	47
Depreciation, depletion and amortization		3		3		3		6		7
Basis of real estate sold		48		33		22		81		34
Adjusted EBITDA⁽¹⁾	$	106	$	71	$	47	$	177	$	88

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

Selected Segment Items

in millions

Q1.2019

Q2.2019

Q2.2018

YTD.2019

YTD.2018

Cash spent for capital expenditures

—

Segment Statistics

		Q1.2019			Q2.2019			Q2.2018			YTD.2019			YTD.2018
	Real Estate	$	96		$	59		$	38		$	155		$	72
Net Sales	Energy and Natural Resources		22			22			20			44			37
(millions)	Total	$	118		$	81		$	58		$	199		$	109
Acres Sold	Real Estate		38,834			47,031			16,290			85,865			38,061
Price per Acre	Real Estate	$	2,424		$	1,063		$	2,258		$	1,678		$	1,847
Basis as a Percent of Real Estate Net Sales	Real Estate		50	%		56	%		58	%		52	%		47	%

Page 6 of 8

Weyerhaeuser Company

Wood Products Segment

Q2.2019 Analyst Package

Preliminary results (unaudited)

Segment Statement of Operations ⁽¹⁾

in millions	Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Net sales	$	1,094	$	1,210	$	1,531	$	2,304	$	2,855
Costs of sales		967		1,070		1,125		2,037		2,145
Gross margin		127		140		406		267		710
Selling expenses		19		20		22		39		43
General and administrative expenses		35		34		31		69		65
Research and development expenses		—		1		1		1		1
Other operating costs (income), net		4		4		23		8		2
Operating income and Net contribution to earnings	$	69	$	81	$	329	$	150	$	599

⁽¹⁾In January 2019, we changed the way we report our Canadian Forestlands operations, which are primarily operated to supply Weyerhaeuser’s Canadian Wood Products manufacturing facilities. As a result, we will now record the minimal associated third-party log sales in the Wood Products segment. These transactions do not contribute any earnings to the Wood Products segment. We have conformed prior year presentations with the current year.

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization⁽²⁾

in millions	Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Operating income	$	69	$	81	$	329	$	150	$	599
Depreciation, depletion and amortization		46		47		36		93		72
Special items		—		—		20		—		—
Adjusted EBITDA⁽²⁾	$	115	$	128	$	385	$	243	$	671

⁽²⁾See definition of Adjusted EBITDA (a non-GAAP measure) on page 1.

Segment Special Items Included in Net Contribution to Earnings (Pretax)

in millions		Q1.2019				Q2.2019				Q2.2018				YTD.2019				YTD.2018
Product remediation (charges) recoveries, net		$	—			$	—			$	(20	)		$	—			$	—

Selected Segment Items

in millions	Q1.2019			Q2.2019			Q2.2018			YTD.2019			YTD.2018
Total decrease (increase) in working capital⁽³⁾	$	(155	)	$	75		$	3		$	(80	)	$	(223	)
Cash spent for capital expenditures	$	(30	)	$	(53	)	$	(68	)	$	(83	)	$	(120	)

⁽³⁾ 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		Q1.2019		Q2.2019		Q2.2018		YTD.2019		YTD.2018
Structural Lumber	Third party net sales	$	444	$	495	$	681	$	939	$	1,250
(volumes presented	Third party sales realizations	$	392	$	388	$	541	$	390	$	521
in board feet)	Third party sales volumes⁽⁴⁾		1,133		1,274		1,261		2,407		2,401
	Production volumes		1,145		1,193		1,180		2,338		2,340
Engineered Solid	Third party net sales	$	116	$	134	$	139	$	250	$	268
Section	Third party sales realizations	$	2,218	$	2,214	$	2,156	$	2,216	$	2,123
(volumes presented	Third party sales volumes⁽⁴⁾		5.2		6.1		6.4		11.3		12.6
in cubic feet)	Production volumes		5.9		6.0		6.4		11.9		12.7
Engineered	Third party net sales	$	70	$	86	$	92	$	156	$	170
I-joists	Third party sales realizations	$	1,709	$	1,662	$	1,630	$	1,683	$	1,609
(volumes presented	Third party sales volumes⁽⁴⁾		41		52		57		93		106
in lineal feet)	Production volumes		44		47		52		91		108
Oriented Strand	Third party net sales	$	160	$	156	$	277	$	316	$	509
Board	Third party sales realizations	$	223	$	213	$	367	$	218	$	341
(volumes presented	Third party sales volumes⁽⁴⁾		717		733		754		1,450		1,493
in square feet 3/8")	Production volumes		729		736		747		1,465		1,481
Softwood Plywood	Third party net sales	$	44	$	44	$	55	$	88	$	105
(volumes presented	Third party sales realizations	$	383	$	380	$	461	$	382	$	450
in square feet 3/8")	Third party sales volumes⁽⁴⁾		115		115		118		230		233
	Production volumes		98		104		105		202		202
Medium Density	Third party net sales	$	38	$	45	$	47	$	83	$	90
Fiberboard	Third party sales realizations	$	846	$	833	$	839	$	839	$	839
(volumes presented	Third party sales volumes⁽⁴⁾		44		55		55		99		106
in square feet 3/4")	Production volumes		45		61		57		106		107

⁽⁴⁾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

Q2.2019 Analyst Package

Preliminary results (unaudited)

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

Contribution to Earnings

in millions	Q1.2019			Q2.2019			Q2.2018			YTD.2019			YTD.2018
Unallocated corporate function and variable compensation expense	$	(19	)	$	(12	)	$	(19	)	$	(31	)	$	(37	)
Liability classified share-based compensation		(4	)		—			(2	)		(4	)		(2	)
Foreign exchange gain (loss)		(3	)		2			2			(1	)		—
Elimination of intersegment profit in inventory and LIFO		(5	)		(5	)		3			(10	)		(18	)
Other		(39	)		(17	)		(20	)		(56	)		(59	)
Operating income (loss)		(70	)		(32	)		(36	)		(102	)		(116	)
Non-operating pension and other postretirement benefit costs		(470	)		(10	)		(13	)		(480	)		(37	)
Interest income and other		10			6			11			16			23
Net contribution to earnings (loss)	$	(530	)	$	(36	)	$	(38	)	$	(566	)	$	(130	)

Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization⁽¹⁾

in millions	Q1.2019			Q2.2019			Q2.2018			YTD.2019			YTD.2018
Operating income (loss)	$	(70	)	$	(32	)	$	(36	)	$	(102	)	$	(116	)
Depreciation, depletion and amortization		1			1			1			2			2
Special items		20			—			—			20			28
Adjusted EBITDA⁽¹⁾	$	(49	)	$	(31	)	$	(35	)	$	(80	)	$	(86	)

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

Unallocated Special Items Included in Net Contribution to Earnings (Pretax)

in millions	Q1.2019			Q2.2019		Q2.2018		YTD.2019			YTD.2018
Environmental remediation insurance charge	$	—		$	—	$	—	$	—		$	(28	)
Legal charge		(20	)		—		—		(20	)	—
Special items included in operating income (loss)		(20	)		—		—		(20	)		(28	)
Pension settlement charges⁽²⁾		(455	)		6		—		(449	)	—
Gain on sale of nonstrategic assets		—			—		—	—			—
Special items included in net contribution to earnings (loss)	$	(475	)	$	6	$	—	$	(469	)	$	(28	)

⁽²⁾ During first quarter 2019, we recorded a $455 million pretax noncash settlement charge related to the transfer of pension assets and liabilities through the purchase of a group annuity contract. This charge was updated based on final pension asset and liability amounts during second quarter 2019, resulting in a $6 million pretax benefit for the quarter and a net $449 million pretax charge for year-to-date 2019.

Unallocated Selected Items

in millions		Q1.2019				Q2.2019				Q2.2018				YTD.2019				YTD.2018
Cash spent for capital expenditures		$	(3	)		$	(6	)		$	—			$	(9	)		$	(1	)

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