Weyerhaeuser (WY) 8-K Weyerhaeuser Reports First Quarter Results

Weyerhaeuser Company				Exhibit 99.2
Q1.2015 Analyst Package
Preliminary results, subject to audit
Consolidated Statement of Operations
in millions	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Net Sales	$	1,788		$	1,721		$	1,736
Cost of products sold	1,399			1,385			1,361
Gross margin	389			336			375
Selling expenses	29			28			28
General and administrative expenses	89			74			88
Research and development expenses	8			5			7
Charges for restructuring, closures and impairments	7			14			19
Other operating costs (income), net	(38		)	15			(75		)
Operating income	294			200			308
Interest income and other	10			3			9
Interest expense, net of capitalized interest	(90		)	(83		)	(83		)
Earnings from continuing operations before income taxes	214			120			234
Income taxes	(37		)	(19		)	(50		)
Earnings from continuing operations	177			101			184
Earnings from discontinued operations, net of income taxes	—			—			10
Net earnings	177			101			194
Dividends on preference shares	(11		)	(11		)	(11		)
Net earnings attributable to Weyerhaeuser common shareholders	$	166		$	90		$	183
Per Share Information
	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Earnings per share attributable to Weyerhaeuser common shareholders, basic:
Continuing operations	$	0.32		$	0.17		$	0.29
Discontinued operations	—			—			0.02
Net earnings per share	$	0.32		$	0.17		$	0.31
Earnings per share attributable to Weyerhaeuser common shareholders, diluted:
Continuing operations	$	0.31		$	0.17		$	0.29
Discontinued operations	—			—			0.02
Net earnings per share	$	0.31		$	0.17		$	0.31
Dividends paid per common share	$	0.29		$	0.29		$	0.22
Weighted average shares outstanding (in thousands):
Basic	524,838			523,426			584,915
Diluted	529,411			527,423			589,312
Common shares outstanding at end of period (in thousands)	524,474			518,735			584,961
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*
in millions	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Net earnings	$	177		$	101		$	194
Earnings from discontinued operations, net of income taxes	—			—			(10		)
Interest income and other	(10		)	(3		)	(9		)
Interest expense, net of capitalized interest	90			83			83
Income taxes	37			19			50
Operating income	294			200			308
Depreciation, depletion and amortization	125			123			123
Non-operating pension and postretirement credits	(12		)	(3		)	(10		)
Special items	(31		)	13			(49		)
Adjusted EBITDA*	$	376		$	333		$	372
* Non-GAAP measure - see page 8 for definition.

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Weyerhaeuser Company
Q1.2015 Analyst Package
Preliminary results, subject to audit
Consolidated Balance Sheet
in millions	March 31, 2015		December 31, 2014
ASSETS
Current assets:
Cash and cash equivalents	$	1,158	$	1,580
Receivables, less allowances	539		525
Receivables for taxes	23		25
Inventories	645		595
Prepaid expenses	95		80
Deferred tax assets	192		228
Total current assets	2,652		3,033
Property and equipment, net	2,524		2,623
Construction in progress	171		131
Timber and timberlands at cost, less depletion charged to disposals	6,552		6,530
Investments in and advances to equity affiliates	183		188
Goodwill	40		40
Deferred tax assets	3		8
Other assets	269		289
Restricted financial investments held by variable interest entities	615		615
Total assets	$	13,009	$	13,457
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	319	$	331
Accrued liabilities	533		587
Total current liabilities	852		918
Long-term debt	4,891		4,891
Long-term debt (nonrecourse to the company) held by variable interest entities	511		511
Deferred income taxes	195		206
Deferred pension and other postretirement benefits	1,249		1,319
Other liabilities	284		308
Total liabilities	7,982		8,153
Total equity	5,027		5,304
Total liabilities and equity	$	13,009	$	13,457

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Weyerhaeuser Company
Q1.2015 Analyst Package
Preliminary results, subject to audit
Consolidated Statement of Cash Flows
in millions	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Cash flows from operations:
Net earnings	$	177		$	101		$	194
Noncash charges (credits) to income:
Depreciation, depletion and amortization	125			123			126
Deferred income taxes, net	35			13			36
Pension and other postretirement benefits	(48		)	10			(47		)
Share-based compensation expense	11			8			9
Charges for impairment of assets	1			13			—
Net gains on dispositions of assets and operations	(2		)	(16		)	(25		)
Foreign exchange transaction losses	12			29			14
Change in:
Receivables less allowances	57			(16		)	(1		)
Receivable for taxes	(1		)	2			67
Inventories	(20		)	(57		)	(88		)
Real estate and land	—			—			(72		)
Prepaid expenses	11			(11		)	3
Accounts payable and accrued liabilities	(22		)	(91		)	(80		)
Deposits on land positions and other assets	—			—			12
Pension and postretirement contributions	(16		)	(20		)	(33		)
Other	(16		)	(11		)	(6		)
Net cash from operations	304			77			109
Cash flows from investing activities:
Property and equipment	(115		)	(71		)	(51		)
Timberlands reforestation	(9		)	(18		)	(14		)
Acquisition of timberlands	(3		)	(32		)	—
Proceeds from sale of assets	4			2			19
Other	(1		)	—			—
Cash from investing activities	(124		)	(119		)	(46		)
Cash flows from financing activities:
Cash dividends on common shares	(152		)	(152		)	(129		)
Cash dividends on preference shares	(22		)	—			—
Change in book overdrafts	—			—			(6		)
Exercises of stock options	35			21			15
Repurchase of common stock	(80		)	(253		)	—
Other	(1		)	4			2
Cash from financing activities	(220		)	(380		)	(118		)
Net change in cash and cash equivalents	(40		)	(422		)	(55		)
Cash and cash equivalents at beginning of period	1,620			1,580			835
Cash and cash equivalents at end of period	$	1,580		$	1,158		$	780
Cash paid (received) during the year for:
Interest, net of amount capitalized	$	66		$	114		$	101
Income taxes	$	3		$	1		$	(50	)

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Weyerhaeuser Company	Total Company Statistics
Q1.2015 Analyst Package
Preliminary results, subject to audit
Special Items Included in Net Earnings
in millions	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Net earnings attributable to Weyerhaeuser common shareholders	$	166		$	90		$	183
Restructuring, impairments and other charges	4			9			13
Gain on sale of non-strategic asset	—			—			(14		)
Gain on postretirement plan amendment	(25		)	—			(29		)
Net earnings attributable to Weyerhaeuser common shareholders before special items	145			99			153
Earnings from discontinued operations, net of income taxes	—			—			(10		)
Net earnings from continuing operations attributable to Weyerhaeuser common shareholders before special items	$	145		$	99		$	143
	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Net earnings per diluted share attributable to Weyerhaeuser common shareholders	$	0.31		$	0.17		$	0.31
Restructuring, impairments and other charges	0.01			0.02			0.02
Gain on sale of non-strategic asset	—			—			(0.02		)
Gain on postretirement plan amendment	(0.05		)	—			(0.05		)
Net earnings per diluted share attributable to Weyerhaeuser common shareholders before special items	0.27			0.19			0.26
Earnings from discontinued operations, net of income taxes	—			—			(0.02		)
Net earnings from continuing operations per diluted share attributable to Weyerhaeuser common shareholders before special items	$	0.27		$	0.19		$	0.24
Selected Total Company Items
in millions	Q4			Q1
	December 31, 2014			March 31, 2015			March 31, 2014
Depreciation, depletion and amortization:
Cost of products sold	$	119		$	118		$	117
Selling, general and administrative expenses	6			5			6
Total depreciation, depletion and amortization	$	125		$	123		$	123
Pension and postretirement costs:
Pension and postretirement costs allocated to business segments	$	12		$	13		$	10
Pension and postretirement credits not allocated	(12		)	(3		)	(10		)
Total company pension and postretirement costs	$	—		$	10		$	—
Total decrease (increase) in working capital(1)	$	6		$	(212	)	$	(170	)
Cash spent for capital expenditures	$	(124	)	$	(89	)	$	(63	)
(1) Working capital does not include cash balances.

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Weyerhaeuser Company		Timberlands Segment
Q1.2015 Analyst Package
Preliminary results, subject to audit
Segment Statement of Operations
in millions		Q4.2014			Q1.2015			Q1.2014
Sales to unaffiliated customers		$	359		$	351		$	377
Intersegment sales		225			228			238
Total net sales		584			579			615
Cost of products sold		424			405			431
Gross margin		160			174			184
Selling expenses		1			2			2
General and administrative expenses		25			22			26
Research and development expenses		5			3			4
Other operating income, net		(14		)	(15		)	(12		)
Operating income		143			162			164
Interest income and other		—			—			—
Net contribution to earnings		$	143		$	162		$	164
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*
in millions		Q4.2014			Q1.2015			Q1.2014
Operating income		$	143		$	162		$	164
Depreciation, depletion and amortization		53			53			52
Adjusted EBITDA*		$	196		$	215		$	216
* Non-GAAP measure - see page 8 for definition.
Selected Segment Items
		Q4.2014			Q1.2015			Q1.2014
Total decrease (increase) in working capital(1)		$	8		$	(26	)	$	(29	)
Cash spent for capital expenditures		$	(18	)	$	(24	)	$	(19	)
(1) Working capital does not include cash balances.
Segment Statistics
		Q4.2014			Q1.2015			Q1.2014
Third Party  Net Sales (millions)	Logs:
	West	$	227		$	210		$	257
	South	66			58			62
	Canada	10			8			6
	Total logs	303			276			325
	Chip sales	3			4			3
	Timberlands exchanges	3			25			4
	Higher and better use land sales	5			2			3
	Minerals, oil and gas	7			7			7
	Products from international operations	24			24			24
	Other products	14			13			11
	Total	$	359		$	351		$	377
Logs Third Party Sales Realizations (per cubic meter)	West	$	106.73		$	98.83		$	114.46
	South	$	45.56		$	45.33		$	44.88
	Canada	$	38.82		$	34.84		$	35.30
	International	$	18.64		$	19.35		$	16.99
Logs Third Party Sales Volumes (cubic meters, thousands)	West	2,121			2,120			2,246
	South	1,454			1,271			1,385
	Canada	254			245			156
	International	148			150			147
	Total	3,977			3,786			3,934
Logs Fee Harvest Volumes (cubic meters, thousands)	West	2,754			2,911			2,875
	South	3,145			2,732			2,866
	International	260			239			249
	Total	6,159			5,882			5,990

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Weyerhaeuser Company		Wood Products Segment
Q1.2015 Analyst Package
Preliminary results, subject to audit
Segment Statement of Operations
in millions		Q4.2014			Q1.2015			Q1.2014
Sales to unaffiliated customers		$	947		$	923		$	898
Intersegment sales		20			19			19
Total net sales		967			942			917
Cost of products sold		855			829			791
Gross margin		112			113			126
Selling expenses		24			23			25
General and administrative expenses		32			27			37
Research and development expenses		1			—			1
Other operating costs (income), net		(1		)	1			(1		)
Operating income		56			62			64
Interest income and other		—			—			—
Net contribution to earnings		$	56		$	62		$	64
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*
in millions		Q4.2014			Q1.2015			Q1.2014
Operating income		$	56		$	62		$	64
Depreciation, depletion and amortization		30			26			29
Adjusted EBITDA*		$	86		$	88		$	93
* Non-GAAP measure - see page 8 for definition.
Selected Segment Items
		Q4.2014			Q1.2015			Q1.2014
Total decrease (increase) in working capital(1)		$	29		$	(99	)	$	(137	)
Cash spent for capital expenditures		$	(78	)	$	(37	)	$	(18	)
(1) Working capital does not include cash balances.
Segment Statistics
in millions, except for third-party sales realizations		Q4.2014			Q1.2015			Q1.2014
Structural Lumber (board feet)	Third party net sales	$	459		$	434		$	427
	Third party sales realizations	$	415		$	403		$	432
	Third party sales volumes(1)	1,106			1,075			989
	Production volumes	1,013			1,043			1,009
	Outside purchase volumes	94			89			78
Engineered Solid Section (cubic feet)	Third party net sales	$	94		$	94		$	90
	Third party sales realizations	$	2,060		$	1,965		$	1,959
	Third party sales volumes(1)	4.5			4.8			4.6
	Production volumes	4.6			5.0			4.9
	Outside purchase volumes	—			—			1.8
Engineered I-joists (lineal feet)	Third party net sales	$	63		$	61		$	59
	Third party sales realizations	$	1,549		$	1,510		$	1,454
	Third party sales volumes(1)	40			41			40
	Production volumes	33			43			44
	Outside purchase volumes	2			1			1
Oriented Strand Board (square feet 3/8')	Third party net sales	$	146		$	137		$	148
	Third party sales realizations	$	206		$	196		$	230
	Third party sales volumes(1)	709			700			641
	Production volumes	694			704			657
	Outside purchase volumes	61			65			53
Softwood Plywood (square feet 3/8')	Third party net sales	$	36		$	33		$	30
	Third party sales realizations	$	384		$	366		$	332
	Third party sales volumes(1)	93			89			90
	Production volumes	61			61			59
	Outside purchase volumes	42			37			33
(1) Volumes include sales of internally produced products and products purchased for resale primarily through our distribution business.

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Weyerhaeuser Company		Cellulose Fibers Segment
Q1.2015 Analyst Package
Preliminary results, subject to audit
Segment Statement of Operations
in millions		Q4.2014			Q1.2015			Q1.2014
Total net sales		$	482		$	447		$	461
Cost of products sold		379			394			390
Gross margin		103			53			71
Selling expenses		4			3			4
General and administrative expenses		18			17			20
Research and development expenses		2			2			2
Other operating income, net		(8		)	(8		)	(9		)
Operating income		87			39			54
Interest income and other		—			(6		)	—
Net contribution to earnings		$	87		$	33		$	54
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*
in millions		Q4.2014			Q1.2015			Q1.2014
Operating income		$	87		$	39		$	54
Depreciation, depletion and amortization		39			39			38
Adjusted EBITDA*		$	126		$	78		$	92
* Non-GAAP measure - see page 8 for definition.
Selected Segment Items
		Q4.2014			Q1.2015			Q1.2014
Total decrease (increase) in working capital(1)		$	(47	)	$	40		$	31
Cash spent for capital expenditures		$	(26	)	$	(27	)	$	(26	)
(1) Working capital does not include cash balances.
Segment Statistics
		Q4.2014			Q1.2015			Q1.2014
Pulp (air-dry metric tons)	Third party net sales (millions)	$	405		$	360		$	363
	Third party sales realizations	$	886		$	854		$	825
	Third party sales volumes (thousands)	458			421			440
	Production volumes (thousands)	468			442			459
Liquid Packaging Board (metric tons)	Third party net sales (millions)	$	63		$	74		$	80
	Third party sales realizations	$	1,133		$	1,194		$	1,237
	Third party sales volumes (thousands)	55			62			65
	Production volumes (thousands)	70			60			70

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Weyerhaeuser Company	Unallocated Items
Q1.2015 Analyst Package
Preliminary results, subject to audit
Unallocated items are gains or charges not related to or allocated to an individual operating segment. They include a portion of items such as: share-based compensation, pension and postretirement costs, foreign exchange transaction gains and losses associated with financing and the elimination of intersegment profit in inventory and the LIFO reserve.
Contribution to Earnings
in millions	Q4.2014			Q1.2015			Q1.2014
Unallocated corporate function expenses	$	(7	)	$	(9	)	$	(7	)
Unallocated share-based compensation	(7		)	3			3
Unallocated pension & postretirement credits	50			3			55
Foreign exchange losses	(11		)	(29		)	(15		)
Elimination of intersegment profit in inventory and LIFO	(2		)	(12		)	(19		)
Other	(15		)	(19		)	9
Operating income (loss)	8			(63		)	26
Interest income and other	10			9			9
Net contribution to earnings from continuing operations(1)	$	18		$	(54	)	$	35
(1) We have reclassified certain results from the prior periods to present the results of operations discontinued in 2014 separately. Our reclassifications had no effect on net earnings or Weyerhaeuser shareholders’ interest.
Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization*
in millions	Q4.2014			Q1.2015			Q1.2014
Operating income (loss)	$	8		$	(63	)	$	26
Depreciation, depletion and amortization	3			5			4
Non-operating pension and postretirement credits	(12		)	(3		)	(10		)
Special items	(31		)	13			(49		)
Adjusted EBITDA*	$	(32	)	$	(48	)	$	(29	)
* Non-GAAP measure - see below for definition.
Unallocated Special Items Included in Net Contribution to Earnings (Pre-Tax)
	Q4.2014			Q1.2015			Q1.2014
Gain on postretirement plan amendment	$	38		$	—		$	45
Restructuring, impairments and other charges	(7		)	(13		)	(18		)
Gain on sale of non-strategic asset	—			—			22
Total	$	31		$	(13	)	$	49
Unallocated Selected Items
	Q4.2014			Q1.2015			Q1.2014
Total decrease (increase) in working capital(1)	$	16		$	(127	)	$	(35	)
Cash spent for capital expenditures	$	(2	)	$	(1	)	$	—
(1) Working capital does not include cash balances.
*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 from continuing operations adjusted for depreciation, depletion, amortization, pension and postretirement costs not allocated to business segments (primarily interest cost, expected return on plan assets, amortization of actuarial loss and amortization of prior service cost/credit), special items and discontinued operations. Adjusted EBITDA should not be considered in isolation from and is not intended to represent an alternative to our GAAP results.

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