Date: Thu, 20 Nov 1997 21:26:49 GMT Server: Apache/1.1.1 Content-type: text/html Set-Cookie: Apache=heart172880061209199; path=/ Content-length: 2904 Last-modified: Wed, 05 Feb 1997 21:43:17 GMT
Rayonier Forest Resources noted that when it announced the first quarter 1996 distribution of $1.43, it said it expected that subsequent quarters’ distributions would be less. Distributions are intended to approximate actual Partnership results each year by keeping the distribution relatively constant in the second, third and fourth quarters and by making an adjustment in the first quarter of the year following to bring the cumulative distribution in line with Partnership results.
Rayonier Forest Resources continues to caution unitholders that the market value of Class A Units is expected to decline substantially as the end of the Initial Term approaches December 31, 2000. Class A unitholders are generally entitled to 95 percent of Partnership earnings and cash flows during the 15-year Initial Term, which began in 1985. After the year 2000, Class A unitholders will only have a 4 percent interest in Partnership revenues, expenses and cash flow. On a pro forma basis, using 1995 results as an example, cash allocable per Class A Unit would decline from $6.17 for the full year to approximately 22 cents. In addition, on December 31, 2000, the Secondary Account is expected to have debt (incurred to fund long-term investment in such areas as reforestation and silvicultural activities including accrued interest) of over $350 million, more than three times 1995’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.
Rayonier Timberlands, L.P. grows and sells timber in the U.S. on 782,000 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.