Date: Thu, 20 Nov 1997 21:28:17 GMT Server: Apache/1.1.1 Content-type: text/html Set-Cookie: Apache=heart172880061297751; path=/ Content-length: 24059 Last-modified: Fri, 24 Oct 1997 20:48:11 GMT
Earnings, Distributions And Other News
Rayonier Timberlands, L.P. Announces Third Quarter Results
STAMFORD, CONNECTICUT, October 14, 1997 — Rayonier Forest Resources Company (RFR), the managing general partner of Rayonier Timberlands, L.P. (NYSE:LOG), today reported third quarter 1997 Partnership income of $16.6 million, or $1.00 per Class A Unit, which is $0.7 million, or 6 cents per Class A Unit, above the 1996 third quarter. Operating cash flow allocable to each Class A Unit was $1.07, 6 cents per Class A Unit higher than the prior year. Sales for the quarter were $29.2 million, $2.2 million higher than last year’s third quarter.
For the nine month period, Partnership income was $68.2 million, or $3.83 per Class A Unit, which is $9.5 million, or 38 cents per Class A Unit, below 1996 results. Operating cash flow allocable to each Class A Unit was $4.04, 36 cents per Class A Unit below last year. Sales for the first nine months of 1997 were $104.5 million, down $8.3 million from last year.
In the Northwest region, realized prices for the third quarter increased slightly from prior year levels. Combined timber sales and delivered log volume was 10 percent above the prior year. As a result, third quarter sales increased $1.8 million to $16.3 million and operating income rose $2.4 million to $10.9 million. Approximately 79 percent of the anticipated annual harvest had been cut in the first nine months.
In the Southeast region, third quarter sales increased $0.4 million to $12.9 million while operating income declined $1.2 million to $9.5 million as the timing of miscellaneous income more than offset slightly higher sales prices and volumes. Approximately 74 percent of the anticipated annual harvest had been cut in the first nine months.
RFR continues to caution unitholders that when the Initial Term of the Partnership ends on December 31, 2000, the Primary Account of the Partnership will be closed but unitholders will not be entitled to have their Partnership Capital accounts redeemed until the Partnership formally ends in the year 2035. After December 31, 2000, the interest of Class A unitholders in the Partnership's future revenues, expenses and cash flows will decrease from 95 percent to 4 percent. On a pro forma basis, using 1996 results as an example, cash flow allocable per Class A Unit would decline from $5.69 to approximately 24 cents. In addition, there will be substantial Secondary Account debt that will mature on January 1, 2001. This debt (incurred to fund long-term investment in such areas as reforestation and silvicultural activities including accrued interest) is expected to exceed $350 million, more than three times 1996’s net operating cash flow. In accordance with the Partnership Agreement, all Secondary Account debt must be repaid before any distribution of Partnership cash flow resumes. As a result, it is expected that the market price of Class A Units should be decreasing substantially as December 31, 2000 approaches.
Rayonier Timberlands, L.P. grows and sells timber in the U.S. on 778,000 acres in the Southeast and on 369,000 acres in the Northwest. Rayonier Inc., the Special General Partner, owns 74.7 percent of the 20 million outstanding Class A Units of Rayonier Timberlands, L.P. The balance is publicly traded on the NYSE.
FINANCIAL HIGHLIGHTS
SEPTEMBER 30, 1997 (unaudited)
(thousands of dollars, except per unit information)
Third Quarter | Nine Months | ||||||||||
Ended September 30, | Ended September 30, | ||||||||||
1997 | 1996 | 1997 | 1996 | ||||||||
Sales | $ | 29,224 | $ | 27,010 | $ | 104,453 | $ | 112,773 | |||
Partnership income | $ | 16,558 | $ | 15,811 | $ | 68,230 | $ | 77,742 | |||
Income per Class A Unit | $ | 1.00 | $ | 0.94 | $ | 3.83 | $ | 4.21 | |||
Operating cash flow allocable | |||||||||||
to a Class A Unit | $ | 1.07 | $ | 1.01 | $ | 4.04 | $ | 4.40 | |||
Third Quarter | Nine Months | ||||||||||
Ended September 30, | Ended September 30, | ||||||||||
1997 | 1996 | 1997 | 1996 | ||||||||
Timber and timberland sales | |||||||||||
Northwest | $ | 16,282 | $ | 14,487 | $ | 63,060 | $ | 72,471 | |||
Southeast | 12,942 | 12,523 | 41,393 | 40,302 | |||||||
Total | $ | 29,224 | $ | 27,010 | $ | 104,453 | $ | 112,773 | |||
Operating income | |||||||||||
Northwest | $ | 10,921 | $ | 8,507 | $ | 48,162 | $ | 55,285 | |||
Southeast | 9,462 | 10,655 | 31,358 | 32,544 | |||||||
Corporate and other | (491) | (491) | (1,475) | (1471) | |||||||
Total | $ | 19,892 | $ | 18,671 | $ | 78,045 | $ | 86,358 | |||
Partnership income | $ | 16,558 | $ | 15,811 | $ | 68,230 | $ | 77,742 | |||
Income per Class A Unit | $ | 1.00 | $ | 0.94 | $ | 3.83 | $ | 4.21 | |||
Operating cash flow allocable | |||||||||||
to a Class A Unit | $ | 1.07 | $ | 1.01 | $ | 4.04 | $ | 4.40 | |||
Northwest harvest volumes | |||||||||||
Stumpage, in millions of board feet | 24.2 | 13.8 | 111.0 | 96.6 | |||||||
Delivered logs, in millions of board feet | 14.3 | 21.1 | 35.6 | 51.0 | |||||||
Total | 38.5 | 34.9 | 146.6 | 147.6 | |||||||
Southeast harvest volumes | |||||||||||
Pine, in thousands of short green tons | 453.3 | 431.9 | 1,431.0 | 1,325.2 | |||||||
Hardwoods, in thousands of short green tons | 44.6 | 64.1 | 124.7 | 166.4 | |||||||
Total | 497.9 | 496.0 | 1,555.7 | 1,491.6 | |||||||