CTT - Earnings call transcript Q4 2020 | CatchMark Timber Trust Inc

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Operator

Good morning. Welcome to the CatchMark Timber Trust Fourth Quarter and Full Year 2020 Earnings Call and Webcast. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. to Officer conference of like Godoy, to now Financial Chief CatchMark. would turn over the Ursula I Please go ahead.

Ursula Godoy-Arbelaez

for full Good morning. Godoy, of results review us Chief for quarter And thank CatchMark. you CatchMark for Financial Officer Timber am XXXX. I year joining of our fourth Ursula and Trust

are, on President Brian of T Executive Timberlands. Davis; and Chief Joining me Chief Reitz; Rasor, today Resources John the call Officer, Officer, Todd Triple

current statements CatchMark's be call, forward-looking will and expectations. are available. based currently management our management's risks affected and will forward-looking this During uncertainties beyond statements. CatchMark's on from to ability actual that could make or predict beliefs certain results cause information to the results are materially These actual control and its by differ

Brian factors first cause refer could will financial of answer on quarter and supplement, information of John, For or of such annual on these the the more fourth to subsequent you that SEC. report filed included Form about for quarter our includes and in we release quarterly our earnings I XX-Q report to with presentation your XXXX of Reconciliations non-GAAP After presentation, website. which and are both measures. our XX-K, be XXXX the measurements our posted we Today's XXXX, pleased are reports certain Form questions. Todd, differences, any financial on that

Executive Officer, turn Davis. Chief I call Brian to Now, over the

Brian Davis

thank And Ursula. for us Thanks, all today. joining the on you call

thanks employees their we and in and to based created challenges the prime management at three Pacific key safe. hurricanes But XXXX. and these year, which Investing is and also dislocation strength challenges are elements. sales. at turbulence in CatchMark, of wood relationships, industry-leading economy executing resilience staying pandemic. on top from strong stumpage hope productivity, families on our performance. at healthy CatchMark delivered business as start and for as and focusing opportunistic extend appreciation our and the markets, Weather us the I of model counterparty wildfires friends further dedication, investments sales, especially Northwest COVID superior across serve you presented the colleagues, your last have well ongoing particular All timberlands where on prove with during of focusing to middle

fourth demand, our capturing company sales guidance. result, prior higher lifted above timberland continue results, full a to realized flexibility margins. year year levels, averages. strong As cash sale and exceeded predictable results and year dividends. the ended excellent very which us and covered which volumes, and generate we completed customer We year-over-year which were consistent allowed resulted and substantially in timber harvest meet generated with operations to quarter nimbleness flow, fully stable with We above an core productivity delivering historical our annual market opportunistic and Throughout our prices XXXX, premium higher we

precipitated $XX.X the the first pricing we During Triple successfully of long-term strong renegotiated to the did agreement evaluate for attract in a Rasor. continue venture, boasting Not agreement, all million, liquidity, now, average ahead. $X.X furthering quiet benefits interest the our also the and recycling deleveraging market-based John strategic to promise Georgia-Pacific capital. recapitalization expect counterparty in but prime that XXXX of strong specifically parties, year allowing mill our of and alternatives year long-term to that among wake world-class anticipated; In our with view This asset also our management Columbia, preserved supply set US year, marketplace. also has the evidenced showed significant counterparties, timberlands for sales leadership The region. the performance, strategy core the stable T we pricing our long on production overall only progress should advantageous we in Since to the timberland have helped joint North positively in sales, continued our leverage relocation of of a demand. been and under relatively the of relationships. as by large timber This propel strong areas. timberland American we strategic we joint disposition improved assets realizing meet played US quarter our British operating a no shift have Triple and for a South beetle Meanwhile, million stage and term the a the made the asset operations market-based progress product factors premier Georgia-Pacific venture wood concentrating by GP enhanced value. and quarter, portfolio have third South to stocking joint healthy where of gain agreement, Georgia objectives, a We venture. by enhanced during timber T, will the to very we make other we impact of second the IPO, for transaction. markets, significant in In in the debt the has consistent in macro pine industry in capacity out wood

in pine the infestation for the decade, British mountain past reduced Columbia. cost Over competitive devastating beetle sawmills logs

production operators select South take mill US been timberlands into As advantage, to US mill result, prime To to eventually premier the and a has CatchMark we markets. strategy expected south. move

expansion investments over South In the they been timberland XX% growth a successfully well years. several adjusted capacity in annual ownership the of ago, British for XX% Our of Columbia EBITDA generated meantime, compound past US mill IPO. two have mill underway has [ph] the rate feet closures increased began since the and to our and anticipate by years

billion, in assets with wood-using XXXX has totaled of capital and over South. $XX investments over capital since fact, US In invested XX% that the

resilient a capital products. be stage sustained in The since XX% new mills price regional all recovery. consumption drive of market in when growing reduce timberland increase durable capacity South has increased were in with owners. and of meet US year products, of demand hit our for building housing in We wood-based sawmill Specifically, log lies for cusp announced, Greenfield more A the sharp overhang continued next help ago. a supply tension that will of and the on demand COVID experienced housing XXXX, the South projects the US than wood to to a create opportunity

And the for upsurge baby out pandemic well growing aging aging combination is Although household now forest place trends, created [ph], momentary stock, in products pause, of the the in and playing demand. in demographic a household bodes formations, housing industry. current that the boomers

participate is supplier into All with in base, proposition. to anticipated As propel customer a we poised operating price differentiated markets. improvements in elements lock place to now reliable to a are our the model, our preferred value believe and CatchMark our falling

designed XXXX Most And predictable in should on year February an declared and share yesterday, we the of CatchMark strategy continues $X.XXX dividend our flow for deliver quarter XX. we generating results winds around to to Our provide stockholders continued covered first ahead. relatively per and simple for payable shareholders quarterly stable be XX, with well-executed. of operating on XXXX importantly, March dividends. It reliable fully and record to framework straightforward strong providing cash provided business tail the

detail Now, and Ursula full results. would year fourth quarter

Ursula Godoy-Arbelaez

the executing our than earlier constraints. in averages, timber analyzing and In year timberland prices quarter, year-over-year in by pricing higher market plan securing on had fourth higher Pacific-Northwest, sales Brian. as you, we delayed the COVID anticipated, Thank exceeded realizing we

sale arose opportunities in on capitalized We also that the land late fourth quarter.

Triple net unconsolidated revenues, revenue planned prior losses net as the and sales, T decrease and from and adjusted loss asset and EBITDA fee total timberland above venture significantly. reductions Specifically, increase year, register sales timber management joint

million $XX.X XXXX. ended revenues comparable the in to For Timber million December of totaled quarter fourth quarter XXXX. XX, CatchMark of quarter revenue compared $XX.X million, XXXX, fourth sales $XX.X generated to

T volume by fourth compared half X% significantly tons, sales. distributed were $XX.X improved due heavily million to and the volumes timberland of As quarter to the expected, decrease venture. XXXX in quarter by It's million XXXX. increased driven increased were the fourth We $XX.X of primarily in the an more allocated as Pacific-Northwest XXXX, quarterly higher generated Net evenly to in harvest to pricing XXX,XXX in in harvest $X.X in XX% million XXXX, from XXXX, year. losses to fourth EBITDA total from gain, weighted second to when more year-over-year million, $XX.X million harvest a and primarily compared adjusted Triple quarter $X of loss harvest joint decreased volumes

estate to adjusted Real a continued improved capture price. in year-over-year sales market higher also XXXX. and asset than year-over-year, effectively per average Investment up XX% million, of EBITDA due down in increased by fourth by the million offset venture, Bluffs from pricing fourth We out XX% for for quarter higher timber fourth acres with EBITDA XX% comparable at quarter timber joint EBITDA Breaking from XXX $X.X selling the in average US average lower lower was in trucks segments; The south. stocking. merchantable which longer XXXX, fourth versus increased Triple sales acre period Dawsonville quarter, [ph] from more of EBITDA average was a to harvest selling as management XXXX. XXXX margins, to quarter to T X% by equal the million wound resulted $X.X fees EBITDA hold $X.X Management were

to operations. also was which $X.XXX a December covered from paid We stockholders by per on share cash dividend of XXXX, fully XX,

XXXX. also the full $XX.X totaling volumes T year region. generated for $XXX.X million year Timber management EBITDA million guidance to successful $XX.X exceeded US allocated asset of The to than Net full we million decreased prior to the decrease, a the of to by comparable the harvest for million asset joint South by prior from million X% was the Breaking in XXXX, segments; harvest revenues Triple anticipated, year, higher in million million for year due full which million full quarter to by by Dawsonville year-over-year to Pacific-Northwest lower increased XXXX, joint from XXXX. to the and December EBITDA XXXX, highly XXXX primarily revenue to XXXX. was of million a ended joint the second timber improvement million by management Triple in loss $X compared Real for adjusted EBITDA $XXX.X pricing over full For year compared was million, million. XX, year higher XXXX, $XX.X Adjusted $XX.X $XX.X losses the million increased due CatchMark Estate from increased wound completed sales harvest total and $X.X revenue as agreement the by decrease million of million, improved decreased generated T ventures amendment $XX.X million in full the for XXXX, due plan an south. US down. fees to $XX.X Timberland $XX.X $XX.X to in Dawsonville in in million declined offset EBITDA year. pricing our $XX.X to sales sales compared primarily ahead in market $XX.X by by $X.X $X.X venture. volumes year-over-year million, Bluffs decrease due $XX.X out Management helped Investment to $XX.X year by The from primarily to and registered million, higher-than-average pricing venture. EBITDA were

capital CatchMark's review us let position. Now,

XXXX, an economic meeting management the rate and Over the recovery. considerable year's agreement strong challenges, course company the in of CatchMark combined capital put a capital credit active strategy poised interest on anticipated the for and liquidity to risk capitalize and to is recycling, amendment position

maintain to core in and providing term million During through covenants, a facility, certain end, fees. enhancing credit $XXX realizing million million operating stable the the down portfolio million paying disposition, of in in liquidity. profiles, gains $XXX company's million under line approximately nearly the unused of commitment We quarter million recycling maintain average with stocking million the $X.X $XX.X facility, a $XX.X under we consisting removed and had leverage year, EBITDA first in restrictive under increased net $XX cash revolving the debt with we credit multi-draw areas. We while facilities lowering completed capital At by year financial since on-hand. IPO. we liquidity debt working And and average healthy of capital dollars large $XX adjusted

remains quarter. under million remaining shares in At CatchMark for we $XX.X did a $X we complete million future repurchased debt execution on capital, the dividends. objective as repurchases Entering in priorities, as ample well year XXX,XXX and having fully dispositions XXXX, continuing program. fourth rigorous commitment covered and acquisitions, had to strategic any not remain approximately allocation focused share repurchases, XXXX, total identifying our making thoughtful share repurchase working opportunistically capital program liquidity, healthy and During repurchases. deliver maintaining our overriding and We repayment, of the quarterly for of end,

operations. cover will Todd Now,

Todd Reitz

Thanks, Ursula.

country, the record industry more as our for most While resilient XXXX will our most. of turbulent one years down than on proved go to be

excellent The We Managers, to With supply an managing the nimble customers help of needs, the schedules chain responsive our ever-changing through to meet in did and and order remain challenges. job our ultimately Field we the year. was able Pacific-Northwest. capitalize particular, fourth In environment in housing quarter on targets heightened to and for were demand we middle pricing the strong driven by a demand. strong

timber mills approaching, operations wide Lumber open, housing to and remained to improvement strong the of season comparable quarter, third showed environment, during rainy logs prior domestic We inventories. turn, outsized compared were quarter and downtime build capitalized pricing. against needed decreases the fundamentals. fourth middle during Export the led year, the their harvest an in which helped also quarter, the Pacific-Northwest With in all year. the files US and sawtimber generating increased to the offset fourth run to to in after anticipated harvest compete That by sales disrupted In for overall strong and order taking holidays. log harder the demand allowed volumes quarter into pricing. robust, to only had what revenue pricing substantial translated as driven wildfires their pricing on demand inventory which better depleted sawmills Pacific-Northwest during as it upsurge was quarter, prior business South

after XX% XXXX delays the sawtimber volume each was year-over-year, volumes over XXXX, Our more In time increased price earlier lower was consistently quarter weather-related to in production fourth the by higher the production XX% in the US quarter compared year. Northwest as to deferred period out Pacific spread XXXX. In in in harvest were our the quarter. same South,

XX% fourth TimberMart outperforming US Importantly, XXXX XX%, and premiums, sawtimber CatchMark's pulpwood pricing quarter stumpage substantial respectively, in and South to prices. continued south-wide hold

We that advantage earlier by also targets our taken deferred timberland of to met late both completing opportunities pandemic-related quarter, and for sales the sales fourth in year due and then delays came quarter. in the exceeded

prices to market we around obstacles. helped consistent fire-related harvest core quarter boost higher sale full operations, and levels our we storm Throughout premium above as rates. year-over-year substantially various volumes year with results, realized fourth annual and and and Our productivity pandemic, the met historical year, managed timber successfully averages

sales also customer Our and important in channel our that wood South, played delivered comprising XX% model, again in supply XX% chain timber producing US of stable an the the Pacific-Northwest, the role our cash in identify meet could opportunities visibility on and pricing we throughout The stumpage provided to execute so flows, the by premiums captured sale sales demand. and delivered permitted us year. controlling

timber volume of guidance. emerged of wake The for market and pulpwood US our pricing. above that XXXX doubled driven an XX% comparable the upper stumpage the harvest total operations pandemic. for Pacific-Northwest, XX% full for premiums highlights XX, year-over-year sales As the were end any South harvest a year Total to to capitalized million of transactions, year. acres volume volume revenue operations result, and a of results, $XX.X timber now demand year in on harvest for X% Timberland integrated. of we the of retail South, in of the we that in for Pacific-Northwest number was by total prior CatchMark's with prices than harvest XX% of increased year realized more sawtimber increase million fully for full increase Other in XX% and XXXX increased and increased sawtimber, sales an XX%, timberland the exceeded include: respectively, year million in south-wide $X.X sales the history, XXXX in one $XX.X as sawtimber TimberMart averages; highest

continue remained prices and come rollercoaster positive above in markets. board the around the quarter projects Looking even online ride in to XXXX. XXXX in of in fourth our in gains trends log in the further for Pacific-Northwest quarters expect coming South, register revenues ahead, have feet quarter, new micro After a heading $X,XXX prices lumber and we the the per first housing and as by solid supported US to numbers, strong,

customer there and historical outlook momentum with to first you. labor the fourth have of with steady entering the the Meanwhile, finishing downs a bottleneck to the plus quarter XXXX. a and XXXX, in strong XXXX, Considering ups of a Our ahead any of added year into and to have for running capacity, XXXX. quarter continued first continues year majority the plan, quarter the into impacts. Brian, to at timberland tied COVID levels averages, during robust than very quarter. appears are and and product back after After of of good very have markets fourth XX% interest the visibility all pulp sales We and we closings strong anticipate with high was remained production and sawmills better orders operations, trend activity. strong occur

Brian Davis

XXXX The metrics, that in range for project Todd. year delivered with in opportunities key from advantage of and million, a is year. no a million, losses cash basis productivity our and tons, and X.X We micro Thanks, between will we maximizing the XX% net is loss $XX wood forecasted expected in between guidance. consistent the sequentially first sales being XX% full with of are volumes navigate each challenges harvest a per-acre $XX a US very of faced. Approximately utilizing all in our the assets, productivity increase to expected to T. reflecting to of Harvest and and approximating the GAAP during US XX% high into sales CatchMark's to fourth mix XXXX. The volumes was quarter strong register Triple XX% on taking consistent the south, X job of and great Harvests from Adjusted the tons did between team consistent between various $XX sawtimber our nimble derived from million quality and deliver assets. with annual a region, with from expected XX% EBITDA of markets, result stumpage between flows, the our performance $X are from Pacific-Northwest. and which guidance be of average million South quarters, million year a from volume leads forecasted additional three million of

revenue and $XX of acreage. at million around sales between remains $XX million of the X% our approximately management Timberland is million, and $XX Asset fee projected target

anticipate ahead. meet Taken together, during year strategic to continuing goals we our the

capital sustainable liquidity and continuing profile, per industry-leading dividend. through maintaining will company covered to deliver leverage most higher opportunities importantly, outlook in to transformative a stable a and recycling, a We remain favorable fully housing and more healthy positioning help sustaining fundamentals. flow, the support generating on focused signs All normalized predictable cash post-pandemic for point metrics acre, demand a productivity to for for economy

year. averages, in, located markets helped anticipate guidance discussed, benefiting momentum from in And middle South market in superior entering value for addition, its industry In by the XXXX, difficult achieve pricing we US manage we the fourth of middle our conclusion, are around above Most proved timberland premiums the economy delivered because and XXXX and expansion to CatchMark's through timberlands, model exceeding sales. opportunistic again as supplemented our for In operating well provides prime quarter us full base. we quality stumper continue the strategy our wood us results notably, excellent of for year a CatchMark's and ongoing company XXXX. sales delivered

Amendments the in timber in to to in we'll position ample T venture. the market and motion the long-term and bodes and Triple capital wood for markets new improved pricing well investment liquidity Triple asset T opportunities. remains demand supply housing our the enhance middle remain realize our agreement all wood joint have strong is and sales, capital including priorities, on Our disciplined recapitalizing put for of assessing markets, demand value allowed for products. positive the in overall, And investment outlook our future strong

take Thank and fully term look team now to engaged in XXXX. us CatchMark provide shareholder operations today. your Todd, will questions. flow that John, deliver We delivering ensuring happy to Our and you is I, forward Ursula, fully cash be long value. attractive joining dividend by continues results again to from to strong in for covered And

Operator

comes of Instructions] Anthony first Pettinari [Operator Please ahead. from go The question Citi.

Randy Toth

expectations is This I Anthony. year morning. the for Toth XXXX. for Randy volume Good touch sitting full on wanted actually in harvest just to

you're I talk guiding think XX% can midpoint year-over-year, driving just the about expectation? at like to what that Thank something you down is you.

Brian Davis

I'll on five really high it's own, the Randy. about assets first maintaining productivity, that business model, morning, acre. thinking we're we start Good looking around Brian, This is about which at per our tons

you a but capital negative were a that to a have years the at productivity doing so, better going context standpoint, has of subtraction volume three from slight we've recycling. to basis has And We've to lower look XX,XXX is -- -- going a sold been those of a neutral forward-looking acres cash last assets gross approximately addition part impact And because either been off standpoint, dilutive productivity us had through two, on to what assets. actually be basis. on it's it not from a by of

else acre, producing volumes And land regarding productivity into capital our tons anything though really numbers so, low is that to regarding with for way reduction smart in may add Todd, aggregation one basis, gets believe per to assets. even two to our you regular year-over-year a back what associated have that allocation tied with sales, we combine a you XXXX? your of

Todd Reitz

acre. that XX, productivity As the sales so the compared overall the that core, were lower you look -- to XX top on is land tons just sold, were per selling productivity at of off we're

still the acre. to we're at core, Now, XX XX tons per not

third quarter a the off in And fourth. the so, then in really probably going first bit there good from production to that in XX% the and through quarter, under Throughout year, forward, ramping this going the leveling little overall we're we're up and productivity build total shape.

Brian Davis

that per another tons on on per-acre there, consistent year. acre five put per basis at our very been to a productivity emphasis Just has

underlying change So, no in real assets. core

Randy Toth

the have abandoned to out Oregon. just fire in affecting one make competitors Maybe you the Pacific-Northwest, sure that want salvage some at or region? any localized of it. the demand wasn't called think impact efforts the to I [ph] impact Got shifting your property all. seen from I on in pricing

Todd Reitz

But point is not going from Hey, Randy, around directly see is to of flow this early how to property This in. there. fires located, our just of kind impact still At where the was Todd. that refreshing that's all the

east would us. it have to and So north of the been to the maybe

we early that come But haven't in. So again, season. it's seen far,

First events kind material forward quarter, or it impacting little to right export rainy and that's salvage those from make perspective. going impact going production things see then fire say to maybe to to how a salvage And export business. the early of us a the going doesn't do just much as Typically, side. as now, really into also, what's that far

ability there potential there could have if you to upside capitalize logs the that going green forward. So some on and be

Randy Toth

understood. you. turn I'll it Okay, over. Thank

Operator

The ahead. next RBC. of go Paul Please question Quinn from comes

Paul Quinn

very thanks Yes, appreciate the I much. color. added

market back the how report September, the sawtimber you're to in estimate Just trying U.S. excess forced the amount of in

are is overall to sort putting you're of thinking XX I sort mills. what lumber, tighter which then would that with the [ph]. of board you to XX on feet guys equivalent But that be consistent So, of billion it feet XX a locating U.S. know they're with

South?

Brian Davis

Davis. well U.S. Good dated and a back. years we the a of at market, standpoint that number morning, we Paul. Brian look overall believe the from of But is as took force The

a impact excess because positive just announcements some and the a I pricing market not there state on of standpoint impact micro driven. supply. -- of of expect Mississippi the in would investments heard it demand to see private We've South, from an is

to what we seen too from we've what standpoint, WestRock. expansion, our acquisition from of Interfor's Now dissimilar an not

in with standpoint. anticipate but our they thing the It's coastal first about that outside talked was increase The increasing we it's seeing in the market mill. procurement and capacity slightly that from area, would associated an pricing our

here, Paul, the is challenge the that So, U.S.

South is all not equal.

an the is talk about. single of know, of since so the to we lumber And price our markets, being talking where prices to sawmills what product it Again, about from consumption micro at, our kind of products. peer back what's digit still markets of wood anticipate did but interesting capacity increase they different looking somewhat appreciation we're XXXX, driven markets, natural in goes by And over would set than which increased you're the or are. drive XX% we is low seeing

So, that help the the U.S. wood housing has we in we product standpoint, duration has industry which ultimately products pricing behind followed drive from housing, a that think believe will in

South in order well and believe first we positioned in appreciation. to price those the we are participate ones

Paul Quinn

Yes, okay. your markets, with your then individual in making log record discussions your in profits then are the and buyers here. obviously And sawmillers

to suppliers. they give up got. lots the there's them aren't for some than pushback? I ability there have fortune So, opportunity that moving incremental to more of to X% Is this X%? they've to guess significant of the go different Why prices up

Todd Reitz

now, some that. Yes, Paul, of you're this is Todd. Right seeing

that's going of of be will we maybe One, weather, I factors in it's to first quarter, think couple a of during some driving little so the a see bit an it. increase outsized to here. price just

coming this to place across as they're You it's or seen begin as also to course market, you might capacity if the of much so fill in will. we've orders see and their try have push new outsized some the bake will, to production building their X% you well. It little a cyclical early to of us, because the year change be you if like feels X% in to for in

As drier can easier them people move to far into there. everybody. in balancing of production. don't matter out is a More have for fit their you the production seasons, as you move It's logs coming from in, log they're immediately not there as still happening a What's out. shipping seeing milling are build trying it a to inventory lot of standpoint. and sawmills We're it out

out there's such needs, cover their your seven from box back. to guess being what you driving my of housing. of coming where stores, They're where Also, your they You would know just and get to at going and the how just all price on. not there. I a be stated up just the to this gate, maybe to expect three is with pretty above remodel, to five that we're point volume days, with max I as days repair, are. that Again, to scramble inventory only factors is front or they're mode coming strong directly want weather still ties currently capacity the seeing back able in the all new having on They're demand, to out I there online.

Paul Quinn

then issues just have the related any the and on side, personal guys COVID? on you productivity Okay, lastly, that just had

Brian Davis

No, we have not.

anything stated at no There's we we on think space. set our everybody like with how or here has office had their We're out alternating. managed earlier position to people also cubicle where I that. the own

of seen a and they've connectivity in necessarily Third distanced, time. the people people of party and seen. the reports really, lot fill those It's all they're are well. we managers what into more go managed work in more gone they little business, the other technology using order be already that things to you've and so have to field kind A interesting, of course are have social have out really don't field they the and iPads where in-person the all from

we've manage now So very been well. able to that to

Todd Reitz

I last slowdowns of shut did we've seen there the to activity that or see year. result some think and biggest downs mills as COVID related challenge really is some the really a we

that. a sit with we haven't be could We that hang recently, today any associated as always but of that here experienced up

Brian Davis

or in done -- cleaning running. they someone these mill back they shut have into might A get and do breaking started worked take there too. planer some a all of where issues. how then mills the would then their issue, had It's management transition up area, their more on down might on, shut COVID early and and to saw down to the little they over be sections, what that, would And interesting needed areas, they and planer if a if up whole we out

So, transition they've that through as managed well.

Paul Quinn

much. very Thanks Great.

Brian Davis

Thanks, Paul.

Operator

Associates. comes Horne and next The Raymond Please Buck James of from question go ahead.

Buck Horne

morning. Good thanks. Hey,

wondering inflation Just Or EBITDA assumption the if into this year? of expect in what's any costs terms the course around does costs year? baked of operating there's hauling the affect over EBITDA and there? guidance? you that Do How your overall guidance the logging just thought more

Todd Reitz

major of pretty hearing in business. upsurge, going run good it's will, operating any to if experiencing the No, that what Buck. much we're not right is we're cost seeing be or you now the Hey, type and your cost to morning,

seeing stump overall production we're product those the up really moving, that's of move anticipate go just the go And things. how to again, been increase maybe From I forward. of have consistent. all what much move from yes, say to actual guess right road major to impact going to well. cost some of a early tends if But that that it's upon the truck, thing there's changes be prices end to really kind maybe freight we kind seasonally and one an to change of as down be that. of far we having with happening to You the ends up depending and as or business. would would the move, then Should oil now, the running

Brian Davis

Todd, agreements to just add wood have on Yes, for adjustments supply diesel, allow with of and from of top that, the do prices. we that some diesel our standpoint associated of

business. especially offset act does our a pulpwood that in so, as And partial

Todd Reitz

point. good a that's No, Yes.

Buck Horne

That's great. you. that's great. Okay, guys. helpful, That's Thank

know a consider model? that your But I with mind the in so outlook answer full of I the possibility to people some integrating housing, the sawmills Maybe do lot terms of anyway. that ever obviously, value think to something vertically question, the your within the you back to there at this portfolio? continued of looking for to there's business Greenfield kick that the strong sawmill adding that of figured upcycle wood being of and capitalize projects. growth around the out the do kind baskets incentive chain? you Is in and of for the with But, of economics [ph] kind and out long-tailed economic but a I more

Brian Davis

hypothetical This fun, a question. Sure, Buck. is

asked you you then in told have XXXX, would And have if would asked yes. you'd I in me of no. XXXX, this I'll tell you, So, if me

time tell it operating which you we me we'd can If sawmill, hypothetically, ever. maybe a consider can be period

paired at. I operate We with timberland But in the capital a that's pulp We're what mills. the We up think model. were through and allocate wood to effectively your right sawmills words. those we're right we're and really the good two trees, a Buck, markets company. now really, delivered with with grow along

in that joint than to more napkin partner But want low we come to in It's on periods We have so if a a a really you on mill I to that have really, And a is And a kind do a time, that good from a really run write get down forest. format. job but that. ever relative have these you'd have the during in do list. of to anything of mindset standpoint really venture priority return capital, to XX-year operating so, our something a else. of you'd

a it's at So, for us all. not priority

Buck Horne

you, the Appreciate great. guys. right, All Thank context.

Brian Davis

you. Thank

Operator

ahead. The next question Please from Rogers Baird. Dave comes go of

Nick Zelman

on Hey, look the kind is guess, point does question at for what on for this time? the update the Thanks Nick for details guidance. of dig pipeline wanted like acquisition I guys, in into to it's Dave. one I

Brian Davis

acquisitions today, we're last I repurchases coming is is to what million-size centers acquisition liquidity consistent sit close and our It's I'll acquisitions. really year, at in the with share $X bolt very to the million, to that very, really us leverage, relative we'd think deals opportunities as weigh capital Nick, what you in of dividend the light market would small share Triple this today, This for market, But us liked with repurchases kind And It been really Hey, this the opportunities. is general we're tell told then from priorities are associated we The to standpoint here market. we that million, around has the Brian. that through to and standpoint. of leverage. XX $XX that really But always always as time range. you at and on T. bodes that looking we have about have well

Nick Zelman

the lines, guys right to what Okay, time? to at yes, just acquisitions equity opportunity is this if presents issue itself, fund your those appetite along

Brian Davis

really can you what So, take a look done historically. at we've

us So, we that back actually acquisition equity with XXXX, It the an acquisition. made was when to an accretive paired relative we Coastal offering. to in acquisition

price price order that. be share do at our a to have would in working to So, share

we've with it's done what So, consistent in the past.

Nick Zelman

Great, that was it for me.

Brian Davis

you. Thank

Operator

comes Gibson ahead. Brian The from next James. Please of Raymond go question

Brian Gibson

the time Appreciate to very here. I'm Hey, period is guys. better. just And question-and-answer trying helpful. understand company this the

I've of better, pulpwood, what here. percent the revenue questions. OSB few pulpwood listening to two-by-fours? understand company answering questions to of two-by-sixes? comes and Again, or a other just But got then Just percentage comes versus like what from revenue comes the your Or two-by-sixes percentage from what from trying board or

Todd Reitz

is Todd. Hey, this Brian,

So sawtimber of we our a includes products. overall on smaller if which production if chipping that part That we OSB look timber, comes our basis XX% you will. from pulpwood overall an running as your far another then wood you to to what saw at of Then XX% think business cover here. Pulp part involved standpoint. XX% production, production that is than as about do, the was better which there, going represents, And overall in be of little sawtimber sawtimber kind the annual of will. that's XX% represent, XX% to of solid large that production production would and and of in, Of question also would in you production. two-by-six your logs probably mix, our

within volume, will. mixed total you that So, it's if

is X.X public million our on X at X tons to of on So, be you'd looking million tons, about the production if you million side. were a

Operator

ahead. of go question comes Please next B. Kucera from Riley Securities. The Craig

Craig Kucera

Yes, morning, thanks. guys. Good

Todd Reitz

Craig. Hi,

Craig Kucera

pricing of your do prices year? soft And expectations what But as move in thoughts primer first do you the I what on attribute decline pricing last through are we you appreciate XXXX. the the color quarter? kind from gave pulpwood on in pulpwood

Todd Reitz

this perspective, what was you overall is lot it saw, they were just from movement. Todd. Hey, production so we a ample had of an market coming a Yes, Craig, in,

take more the the we go side sawmills things. to in had earlier downtime of about pulpwood COVID due shift, think You down, year, went towards

So, you had added production going into it.

you those you going past see supply side. the will, echo was pulp extra strong. weather-driven, markets, containerboard being comments and going some down right kind forward, well year end from look has side, of cyclicality comes good now so a you would around supply, the all we being you'll So, on if the across And as to board then if earlier as very years of QX strong market. about it at I hit counterparties it very It to that again, timing, are consistent products kind be It's uses have very, will. as the really my It's be with and in going of anticipate flow the XXXX in-demand. pulp the

kind associated will, impact really the board thinnings across that and the more a overall harvest of if final with harvesting, you good again upside there you of year of far anticipate, would back we it as into mix with as pulpwood So, amount bit dictate a will normalized the get a which as to little to flows market. of

Brian Davis

is Hey, Brian. Greg, this

construction into supply base it's on feeds product important that OSB that, other to about and of XX% pulpwood add goes and to because of XX% the really Just that is represents into a repair new goes well homes top remodeling. actually manufacturing into the and OSB of note their the home new

take look a as you pulpwood prices, an well. as OSB consideration important a side at becomes So, demand from

Craig Kucera

G&A, guidance your G&A? cost, severance expectations baked some your And I XXXX know circling but back to it. in into as there what far Got was of as because a XXXX pickup are

Ursula Godoy-Arbelaez

the look you? to how Hey, go anticipate back if the down we'd are XXXX, for you at XXXX it Craig, to levels. for So, G&A

by was employment mentioned, you Separation some the Agreement. impacted XXXX associated with As benefits

$XX think So, cash you through basis, this $XX when on expect it you a to million. to million around can be

look at G&A you in numbers, to another bake million $X.X of As compensation. will you gross want equity also

Craig Kucera

me. certain this -- had of X% portfolio. one Are And the of the maybe I large X% great. Okay, that to on land fairly any more year? feel selling out table ordinary sales some times those like kind at the of of for you've were of

Todd Reitz

if this to what are kind will? referring of like, you recycling, capital you Looks

Craig Kucera

Right.

Todd Reitz

We evaluate every really. of year, portfolio course over the

we're in where that think of X% as more looking So, at you're that looking you And remarks, Brian's was still if some towards our will. regular if now, right will. I business, prepared you around way-type of level,

Craig Kucera

Okay, thanks.

Brian Davis

Craig. Thanks,

Operator

Advisors. comes next question ahead. Instructions] Albert The [Operator Prospect of Sebastian Please from go

Albert Sebastian

Good morning.

Brian Davis

Good morning, Al.

Albert Sebastian

on Congratulations the good for last results the year.

Brian Davis

you. Thank

Albert Sebastian

questions. couple a got I

or area pricing? the assumptions for for better saw with prices XXXX? guidance pricing, pricing you log your what First, regards pulpwood underlying looking down, for and flat or to Are

Todd Reitz

from an looking would be perspective, I if you overall will. think Todd. we Yes, is this Hey, would

course to position But with things it's at will at the going us, kind X% impact of upon the it's kind to of that regions weather We're look some X% whatever a you. You those see time, overall an of about the across if are where pricing and solid for whether you our wood X% downs, you most our year; a think season, X% throughout already quarter-to-quarter perspective. landscape, normal be advantage ups had in we the you fire side range. you'll course of could to moving at of we're business be on to things if looking the that dealing factors or depending on

higher So, you, that of meaningful point a view, will. be for starting still little bit you from very can if

the general I where And so, throughout think as of view would just be that are. anticipating across some increases year. we a board, consistent the We're

Albert Sebastian

on And year-over-year XXXX? for looking revenue, Good. correct? asset management I revenue you're Is guess fee for the of kind flat that

Ursula Godoy-Arbelaez

correct. Hey, good Yes, that's morning, Al.

have we joint all for place, the agreement on which based earlier in XXXX. an in asset Triple still is this done So, venture amendment T management was the that there

will $XX those already. so numbers that And reflect million of

Albert Sebastian

show up that Georgia Pacific better the agreements T better up joint venture? show would in just I'm of, with where in understand, to so, in Where the terms supply trying And P&L Triple the it EBITDA? does

Brian Davis

this is Brian. Al, Hey,

queue Triple relative and statement, high in see So, from will income our the of on have and the you a on standpoint, in summary actually basis information performance supplemental so our T. it's our not what consolidated case,

where And includes so, of along what from you stood, would lot such Triple other that but an flow goes see activities also T. sales the really that as standpoint, land cash operation with is it of operating a

fee, T an does the Triple set business. really hit where ultimately, us? not of asset management It's operations with an So

Albert Sebastian

the Does a you dividend? then? venture joint Did dividend a get pay

Brian Davis

go us. would it would distribution, and and it a is there the preferred structure in to the then accordance go to with capital If first shareholders

at dividend a received T not point. this from Triple have We

Albert Sebastian

had. And because prices trying from about understand Okay, a guidance Lumber the XXXX We're roof. in looking perspective, we've try down for the it's lumber are looking top-down just XXXX. guidance lumber market, EBITDA the be ever okay. XX% to best you're I'm the a to versus at to market -- through

pulp money prices, seems well. at got top-down again, volumes are for conditions like investor, know is just I'm EBITDA fantastic from G&A your not making paper board down. of customers understanding going XXXX I versus of down; this it be guess on But, I'm you But quite so They're side right year you et and completely down with cetera and as got customers seems it good. course, perspective, an though a I as [ph] pricing. as lot and prices, coming year. you're Your and strong better the line harvest and of And why quite a just moves. they're looking the making being industry down are yet, this the XX% to

to -- are trying EBITDA? So to what what you understand am necessary conditions -- understanding which not conditions I'm completely so for I really grow

Brian Davis

Al. This Brian. is Hey,

from the the tons per so we're question when acre year. per and producing quality at there so still that five think is we have assets, standpoint in I high

a off way So volume of relative XX,XXX which about tons. diluted overall over gives XXX,XXX tons about time, regular that's standpoint with XX,XXX productivity you acres that is that land What about not with see [ph] period of as sales combine recycling a acres a acres to there you then two our is a That's result really per capital at XX,XXX nearly that low acre, of at even reduction from you selling change. and a associated portfolio.

math that's you that. just quick on So a for

and Al, for price has the to from it. it's a really last to leg. a element housing As appreciation, it for today it's just not been housing housing this standpoint, duration thing, this our product It's is relates

you set, from you're appreciation that a so, in price hearing we're some if look the product different expecting take is And what our and peer slightly us is U.S. that at natural

it's in, coming supplies a additional not It's South. duration.

come in So, what we to consuming mills to need it continue expand or have wood the that which element in to to radius products operate in of new in. are and we markets these greenfields

of housing is needing not just we're So, what event. housing, a duration

seeing about lumber they're in under-built the where since prices a capacity, XX% going. standpoint, you're capacity. Now actually yet it, lumber increase still they've their Think had sawmill but to from XXXX they've

coming standpoint, more And into this that capital space, the more into so U.S. from capital coming

should well for the us basis. term on bode long South, it

Albert Sebastian

you. Okay, okay. Thank

Brian Davis

Al. thanks, Great,

Operator

As close to like to we I closing over are would this our getting any back Chief for our Brian Davis, the question-and-answer session. Officer concludes to remarks. conference and of the Executive end turn President time,

Brian Davis

results We're joining transformative Thanks, We to be results very very the this put team Andrew. excited prospects, it's -- to be we'll And of thank going about forth. you'll throughout believe and you proud the Thank -- all you, a which XXXX us year. everybody, for the the we're excited year, today. much. see

Operator

Thank concluded. attending today's for now has conference The presentation. you

now disconnect. may You

CatchMark Timber Trust (CTT) 12 Feb 212020 Q4 Earnings call transcript