RYN - Earnings call transcript Q4 2024

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Operator

Welcome, and thank you for joining Rayonier's Fourth Quarter and Full Year 2024 Conference Call. [Operator Instructions].

Now I will turn the meeting over to Mr. Collin Mings, Vice President, Capital Markets and Strategic Planning.

Collin Mings

Thank you, and good morning. teleconference quarter investor Rayonier's to covering earnings. fourth Welcome

supplement yesterday website afternoon earnings rayonier.com. statements are released financial and our Our and were available at on

I provisions of presentations, securities in laws. made would you federal to include pursuant harbor forward-looking statements like these safe the remind to we that

referenced Our and forward-looking They to results differ and from the forms Page XX-Q SEC make. with the on actual earnings some may of our also cause we of release statements are may list the XX-K financial filed factors X that materially supplement.

also Throughout we GAAP non-GAAP presentations, release are these which our defined in reconciled will and nearest discuss the financial materials. to measures, supplemental earnings and measures

With teleconference Mark opening that, our from start comments with our Mark? President let's McHugh, and CEO.

Mark McHugh

everyone. morning, Thanks, Collin. Good

will And real high-level turning financial Officer, consolidated and and Vice April make and Resource discuss before comment President our Vice I'll Executive outlook New over Senior estate Then U.S. Financial it review Officer, review First, Chief and President segments, will timber Doug XXXX. Long, Tice, for the Chief some our our to to results. following timber our April our results. results on Zealand of comments

prior the nimble per forma market pro and year slightly persistent net which $XX Full XXXX full million, we our to -- and full These share. pleased our financial to of above prior the better-than-expected $X.XX headwinds. X% year roughly year. us year million amid was finish were quarter range fourth or results, above adjusted We EBITDA $XXX allowed results deliver with guidance execution resilience income of high end demonstrate

primarily The forma we million Zealand significantly per versus improved in New $X.XX of quarter, net Real income prior adjusted was fourth generated our results adjusted $XX in increase the or driven and pro quarter $XXX in year segment. million the Estate XX% Timber by EBITDA EBITDA and -- of We share.

period. prior The acre million dispositions, value real excluding our per our value. significant increased team's up by roughly premiums adjusted large estate price $X,XXX, the generating of Our portfolio $XX bolstered optimize HBU contribution business ability by weighted development timberland improved year above delivered the Real and of Estate of our strong average from demonstrating million, was from $XX EBITDA to segment extraordinarily an

our operating to segment Shifting results. Timber

on Timber volumes significantly modestly adjusted fourth higher The stumpage of Southern the XX% Our segment quarter was and X% of largely EBITDA impact lower a realizations. average million, generated throughout by was the offset quarter income period. Hurricane year driven in following $XX the stumpage salvage net by harvest A the volume non-timber prices decline in large market decline part weighted up in prior from Helene.

in million Timber in $X quarter In decrease offset lower volumes decrease quarter cost by our and prior delivered fourth average Pacific segment, harvest was a adjusted Northwest X% X% non-timber of flat versus year as income. prices a and log the EBITDA largely higher were

foreign exchange lower realizations Turning the favorable volume, New to net offset increased increase EBITDA adjusted impacts, of Zealand versus by million Timber costs, higher quarter. $X sales. million in EBITDA credit was driven stumpage adjusted The Fourth quarter partially prior lower and segment. $XX carbon year our by higher

quarter. announced the operationally, acres we large closed the $XXX to year to of million totaling strong fourth the successfully addition during on In finish XXX,XXX previously approximately dispositions

capital allowed have on while call, share. and As reduce shareholders CAD per our also generating discussed us earnings to accretion return to November leverage to these transactions

fourth of the $XXX to original quarter. target, million and repurchases, including us Xx cash, $XX our in closed -- of roughly shareholders To $X approximately and million form share $XXX net allowed of share million date, return has and special dispositions, to capital repurchases we've reduce which below XX% in the billion leverage now of on dividends of to over

to XXXX. outlook Turning for our

slight April dispositions discuss expectations million reflects as to greater the relative EBITDA adjusted million. in the fourth the realized we providing guidance The year the completed our call, at last in lower year. as will quarter segment results $XXX well EBITDA of XXXX modestly in Real full $XXX the extraordinarily adjusted detail As Estate strong decline in later are midpoint to following

Overall, as with will the we move cautiously demand. new improve year, timber are we that gradually along market into prices optimistic end

rural year, we another development properties. platform estate the from trends this In for contribution expect favorable given our real our addition, HBU demand continued strong and

capture we flow relates growth encouraged carbon pipeline remain of on drive opportunities coming in we the solar storage, as continue by land-based build to will the which the years. expect to especially that it Lastly, and and front, cash solutions meaningful

With that, our fourth to quarter details April over let on me results. for more financial turn it

April Tice

Thanks, Mark.

highlights the financial to Page of X Moving the on supplement.

was million For the million fourth included sales million income restructuring income basis, totaled gain while $X.XX quarter, from the income net to $XXX $X.X was of $XXX with or dispositions, cash $XXX million, $XX $X.X fourth $X.XX in terminated items or share. Rayonier forma quarter million income associated costs and was flow operating per attributable charges. settlements On a forma Pro legal million, net pro share. million $XXX of $X.X a hedge, large million a of from and per

$XX the prior $XXX from the was period. million quarter, Our in year adjusted in million fourth EBITDA up

and at resources Page X. Moving the of on to liquidity bottom capital

for on measures year the for financial partially adjusted interest other expenditures, higher A cash reconciliation $XXX is taxes activities offset slightly distribution, paid. provided cash of versus higher was lower provided cash of EBITDA, year supplement. capital increase or driven lower X the The million to and CAD operating Page available by GAAP by period. Our by paid and $XXX the net cash in was million CAD, prior

and XX of timberland As dispositions paid declared OP in share on December, shares In common units a we early the aggregate, $XX cash year-end. shares. million taxable completed which dividend arising X.X distributed combination the a of and $X.XX cash following being in in January million special the of from the and quarter, resulted dividend special gains fourth during result per a was

have we For purposes, shares the units and modeling dividend. X.X XXX.X OP million million now outstanding following special approximately

have REIT further share that we capital our reduce allocation future and to continue to income other retained capital end, By repurchases believe at represent meet current priorities. repurchases on we to fund requirement, taxable distribution the of this compelling price. To of -- execute debt, stock share or flexibility issuing part use significant a shares

repurchases share new $XX act affords moving quarter, ex to share. $X.XX special of fourth share it an to the December, per to million dividend per prior quarter During the date occurred price at repurchase $XXX us share with we as repurchases XXX,XXX our average which our repurchased shares Board Notably, relates approved capacity share fourth respect a to forward. program, dividend. opportunistically In significant roughly

After reduce $X.X of meaningfully million Proceeds from debt. cash plan have our of $XXX roughly allowed quarter paying we us with total a debt and off $XXX fourth also disposition the during the billion of million to leverage. closed quarter, of

net the trailing EBITDA dividend last end component we Our quarter and cash forma of week. or X.Xx pro adjusted the to XX debt special approximately for months X.Xx -- was at that paid

and We stock cost quarter value no weighted enterprise At maturity to of quarter end, significant at approximately was XX%. debt closing our -- our years, average was our weighted until of debt on with debt the the XXXX. was based on approximately maturities net X price portfolio our the average debt X.X% end

first in market The that dividend I quarter share yesterday after adjustment per X.X% note quarterly $X.XXX per dividend we our the closed. from will share declared the $X.XXX reflects also to its in regarding dividend, consistent and impact anticipated increase with communications ordinarily dividend. outstanding X.X% of our is the the shares and our a quarterly previous as result units recent special on

Doug to review to detailed turn of call provide I'll the a timber over results. our now more

Douglas Long

April. Thanks,

the disposition our Hurricane operations by prior Let's realizations. harvest constraints year Page start and quarter Oklahoma quarter quarter was $XX well lower as resulting EBITDA with prior more net offset on salvage acreage, contractors harvest segment. volumes to some fourth above of year X% volumes fell properties the temporarily to higher non-timber Southern in due stumpage our shifting costs Helene. production X than on the of impacted million Adjusted and lower Total as as from Timber the revenue versus

higher revenue in favorable compared per ton, increased period due the Atlantic salvage the to to year by mix decrease pricing $X was in stumpage million of non-timber and the solutions timber land-based sawlog year versus geographic easement Average period, business less a a XX% prior driven $XX pipeline region. Meanwhile, low-priced growth and prior our revenues. availability

average net year quarter lower roughly and stumpage per fourth Oakwood geographic weighted X% $XX in prices than salvage the $XX XX% at to pricing stumpage was the per year versus roughly ton. the to decreased prior prior quarter ton Overall, availability volume. of due quarter mix also

the dry shifting to lumber salvage weather fourth the their highest relatively log in Encouragingly, ample soft logs. the X our Southern In weighed led golf In upward which markets, green levels with also gray their quarters. markets, quarter Yellow was to procurement ended near quarter mills an Atlantic region pricing. on conditions and trend Pine during supply in on currently sit prices demand

continues Overall, salvage Southern in we the region. declines availability will gain the for volume lumber and the believe to market markets Atlantic Pine North outlook in improve Yellow share gray overall as American the of

Shifting to pulpwood.

pulp in customers, region improvements to dry weighed for salvage mill implementations pulpwood ground region demand and While Gulf from Atlantic prices. operations by our the which quota in conditions the encouraged led have been ample market in end on supply elevated the we inventories sustained and during quarter, hurricane

operations, the direct impact hurricane our the now season operations minor complete. portfolio largely salvage As most are and to it to was salvage our relates on relatively

several likely our first on persist continue of availability markets XXXX over and the may weigh Atlantic last which of dynamic to we the through and However, this been salvage pricing. that volume certainly expect has the will a half in headwind months,

$XX $X stumpage and compared X% weaker domestic quarter unfavorable our Moving average by prior harvest due lower non-timber lower sawlog to to were line harvested chip-n-saw demand in the Total and the period, year reflecting as XX. year product in period, impact mix an Page the the Timber per from and volumes delivered lumber mills from prior decreased the current the Northwest proportion in largely fourth was At decreased realizations combination million year segment pricing in EBITDA recent quarter offset year a to of our ton, in fourth costs period. was as dispositions net adjusted higher on of of X% the harvest prior a quarter of with Washington. as quarter Fourth income. volumes higher Pacific

prior per pulpwood up X% Meanwhile, at $XX quarter. was versus pricing ton, the year

in Northwest well both market Western in lumber reductions positioned SPF Pacific improving. have export as demand mills supply XXXX, show toward markets producers that there quarter, prices the domestic soft remained are indications To Canadian conditions this positive potential to begun to further momentum from from lumber producers. end, region with benefit and for gradually in during the are fourth While look we

are export Douglas addition, in the optimistic Chinese Japan. reemerge signs of and response logs anticipated an in In fir cautiously attention in will we demand to market from stabilization recovery gradually the market of property in

to EBITDA year results quarter. New million lower for Adjusted the Zealand. carbon shows credit EBITDA adjusted was in key stumpage our higher the was and and period above increase $X foreign the exchange prior operating prior partially favorable Page realizations the driven fourth million income. by higher Moving segment. net compared XX by lower impacts, quarter costs, to $XX volumes, of in The year metrics offset

export the prior quarter. delivered X% per to $XXX ton sawtimber Average compared prices increased of year

by gains increasing X% only with stumpage largely versus offset higher the However, realizations freight these net were port prior quarter. year and costs. pricing

approximately was XX,XXX In cubic meters ports December, day. per offtake Chinese from

X.X levels, year meters, prior Chinese at from sluggish. ago. slightly as levels adjusted remains weaker generally remains soft. softwood were have they demand log slightly environment At a inventories property up the demand million end stood December, sector of ports China's Inventory log to relatively approximately cubic Although than higher at the year

Zealand sawlog Shifting increased the quarter prior from domestic market. delivered to year the prices Fourth X% period. average New

contribute encouraged in basis in last property interest New of XXXX. headwinds to The signs rate and are points environment in as of anticipated New economic is demand we lower by August its lowered Zealand has stabilization market confidence market While improved increased by since XXX Bank Zealand rate domestic to consumer the of the Reserve year. cash persist, official

lower New as New to income Zealand million carbon $X a non-timber year decisions modestly announced period. generally well stabilized in reflects August. in quarter prices policy of lower Fourth Positively, The as to volume decrease the prior as Zealand pricing year sold have carbon decreased prior $X million of following compared credits period. relative year-over-year in primarily

registered we segment, the Trading our in in quarter. Lastly, loss slight operating a fourth

our As activities provide designed our trading a and additional low are business. export generate typically reminder, of economies feed timber scale to margins to primarily

April to to back results. estate over real it cover turn now our I'll

April Tice

Thanks, Doug.

the period. from roughly $XXX the the XX, sold, acres estate Page revenue large quarter. our XXX,XXX the contribution XXX,XXX As on million which quarter was Real Real during year detailed of fourth above roughly totaled on dispositions during Estate segment prior acres considerably completed included

million fourth Excluding an per acres quarter X,XXX transactions, acre. these average sales price at sold of on totaled $XX $X,XXX roughly

of achieved strong as that average higher per on proportion rural The closed above significant well timberland as development price the period both sales our team a during acre value the premiums sales. land reflects

of Center will EBITDA quarterly mix activity per commercial totaled parcel was This a primarily our uses. largest contribution million, XX-acre segment development project residential The fourth project adjusted Drilling heartwood acre. industrial, homes strongest quarter million in the and for $XX Estate more Village the build-for-rent was Georgia. in transaction bring X Heartwood's improved down, residential sales sold with enhance or Real Savannah, that million, diverse south will $XXX,XXX in $XX in and focused $X.X development the to over of the category years.

also In of closed a pod a acre, for sale parcels project, acre. development $X.X acre well of a X.X a credit closed $X million $XXX,XXX million $XXX,XXX. roughly a we $XX,XXX addition, per union for we the In our residential X-acre parcel commercial for development XX-acre Wildlight per as for or as or industrial

Entering XXXX, homebuilders sales interest both Heartwood our the projects in of and as continues favorably. to continues be a there trend healthy residential to Wildlight -- pace from

projects. overall we some be While at developers the both have the to time as rate interest current contend extended the with for momentum with line deals commercial pleased environment, continue

sales exit master including In category, of golf amenitized million The a our St. residential totaled in buyer to totaling development property as course, construct Marys, plan a acre directly X X,XXX of $XX.X we Interstate units. east XX a community, about sold plans highly unimproved X,XXX Georgia.

benefit of of Similar price the in from also payments to to our community the based we sales land homes as they final will the on many true-up homebuilders sold. selling are

planned residential uses. our holdings, with this nearby master mix We will XXX community including for catalyze demand a and expect for acres entitlements that over commercial adjacent land improved of

finish the Turning by transaction see favorable pricing consisting pipeline last of increased exceptionally average heading Fourth rates at rural an continue to approximately expectations remaining We of rural roughly quarter interest an elevated, $X,XXX per our strong the to rural Despite over the had totaled category. our been into million, price X,XXX the acre. as $XX conversion acres of sales year our buyer months relatively interest several year-end. and exceeded for have and to we encouraged properties. demand

meaningfully continue the to contributed interest buyers, the strong In during addition, see we from conservation-focused quarter. activity which fourth sales to

favorable we Moving and the XXXX. as and the low interest business for progress forward, and supply real through remain shortage, rates spur the both our should outlook long-term development estate that demand unemployment, of expect optimistic historically demographic trends prospect housing properties for rural further lower migration and about we

G outlook adjusted attributable our to and Rayonier reconciliation on income guidance Schedule provides to of XXXX. our EBITDA. our net financial of moving our our now segment -- shows by for release supplement from to a guidance XX Page We of earnings

to of $XX $XXX For full attributable XXXX, EBITDA to of to million per and we earnings $XXX achieve $XXX Rayonier million million expect million. to Net year share to adjusted $X.XX of $X.XX. income

guidance disposition as Our part previously any announced of of the sales excludes asset billion plan. potential $X impact our additional

volume to expect the harvest tons, achieve starting prior million XXXX partially the volume of respect increase to Oklahoma carryover reduced some segment, million with offset modest due volumes XXXX, by to X.X X.X Timber of year, full With Southern segments, into we from primarily the our individual versus our to disposition. year planned a

expect anticipate versus full pricing, that will lower salvage of the realizations the as slightly realizations in into to prior due year prime trend be stumpage we continued to while volume relates year, to year progresses, higher part we the it As the market. impact

adjusted expect modest results. slightly a year full year. benefited decrease Overall, significant compared Lastly, million the activity. pipeline income full we non-timber to million, we prior below XXXX year easement year for $XXX to expect full which $XXX in of from XXXX EBITDA as

decrease expect In our The from our to in yield resulting year year to volumes reduction sustainable segment, Pacific reflects the approximately dispositions the Washington. Pacific tons. anticipated Timber Northwest of the we Northwest harvest relative XXX,XXX in full recent achieve prior

expect these results. weighted of the prior modestly year versus we on result $XX as million full year conditions. full year factors, log that adjusted to we Further, increase average a of million XXXX full improving will Based pricing $XX to year demand expect the comparable EBITDA

X.X year volumes Zealand to full New expect of X.X our tons. In million harvest segment, we million

As sales a it pricing achieved adjusted We anticipate and to period -- EBITDA results. full domestic pricing modest of full of as the increase volatility. pricing also to in in increases in we -- both we million year modest sawtimber to a relates unusual to supply-demand up expect credit we year dynamics has $XX export $XX in pricing, versus XXXX relative carbon drive Overall, full expect XXXX. million, XXXX market stabilized We following modestly year improving

to Real Turning segment. Estate our

strong demand are and We the by for HBU continued value realizations properties. encouraged our

suggests current land as rural as another development for projects. both pipeline well improved Our sales our solid program our year

full Overall, similar down a million of to to $XX adjusted EBITDA year than we first year However, $XX with the we activity EBITDA the million. correspondingly modestly very of less million, $XX quarter adjusted from XXXX, anticipate XXXX expect in closing light full results. exceptionally low strong

realign also scale reduced This total initiatives. difficult our to in focus efficient led an while adjustments us of XXXX, dispositions light XXXX structure actions recent but guidance organizational recent we maintain strategic reduce light completed also resources to have growth activity. costs U.S. our XXX,XXX we disposition on expected structure XX% of acreage. and Since Our overhead following November roughly important the acres, took reflects approximately necessary the make reallocating cost to of to company, in savings totaling of overhead

these to translated and restructuring workforce Overall, in the of reduction quarter, $X.X estimated for expenses. severance-related charges resulted U.S. XX% in a actions million in our roughly fourth

Mark back comments. I'll call closing the now for to turn

Mark McHugh

Thanks, April.

Before difficult effort several headwinds facing concluding the displayed strategic XXXX, today's call, the I'd our recognize navigating while in throughout . initiatives exceptional like advancing important timber by our to team businesses. simultaneously

were counterparties On XXX,XXX Alabama. announce easement the storage, portfolio. carbon affiliate continues given with team our our discussions in land-based build of solutions attributes an opportunities broadly, space number to pipeline a of pleased a agreement and covering high-quality future of poor favorable approximately More the front, of reliant acres a with new and capture recently advance to we strong

In total, lease of and we capture we carbon for and Continuing financial acres option solar Investor to materialize that XX,XXX we that year-end, XXX,XXX as business Rayonier, are had strategic toward EBITDA development. under and by is approximately we for last Day XXXX contributions priority and key a adjusted encouraged storage beginning acres under targets land-based grow the February. solutions our build at the to are communicated our as XXXX approximately

As capital manner we timberland capitalizing disconnect also values in of on our dispositions, I that private in on and NAV on and has public structure roughly a closed CAD -- share. accretive between We've discussed both tremendous earlier, million $XXX plan the disposition to per and and made realignment now progress XXXX. been

sheet the interest sales with on well evaluation we toward with public-private disconnect. view forward, Zealand as improving capitalizing streamlining strategic our balance Looking further asset joint our positioning venture advance continue of respect in to to potential portfolio, and our other as a our New alternatives

weather and our macroeconomic Further, recently ever-evolving events agility actions for organizational as local team discussed, dynamics, to our market an we've our structure adjusting Throughout environment. April demonstrated XXXX, severe footprint. taken smaller remarkable realign to

emerging position advance capture strategic to will were decisions us such while to ready difficult, operate remaining efficiently more our opportunities. While and priorities they

remodel of the more improving U.S. anticipate housing remain market an in shifts production prospect will we that to into into as likewise recovery market American repair may market on duty cuts, potential U.S. new expected conditions an improving translate North higher continued lumber and production demand Canadian from lumber constraints Looking into end and supply the Further, ahead, the and rates we tariffs conditions. optimistic of operating the U.S. translate undersupplied the

exceptionally as both volume detailed the sales to front, Lastly, we I real on finished strong timberland of achieved earlier, quarter with terms an estate in premiums and the values. year

that Looking across and more our the further that we're ahead, demand believe positive we by real improved development we financing categories our bolster platform. seeing momentum the are across continues to encouraged favorable especially estate build conditions could

how while team deliver our able to In market relentless results also sum, creation. on was the throughout year conditions strong navigate I'm proud shareholder to driving challenging of focus maintaining financial a value

and remarks, prepared operator call the questions. I'll our to concludes turn for now the That back

Operator

[Operator McKellar from RBC. Instructions]. Matthew

Matthew McKellar

wrong, of pressure through operations, the volumes salvage correct of do stronger year volumes you're in sounds specifically, year? salvage this own wrap up imply own if half the salvage from on the maybe on is wrapping Please like you year. the relatively put it continue this up? maybe in first And expecting Does also me anything heard I market price about the your the Rayonier expect to second the your in should to volumes other be through half salvage operations we salvage the the

Douglas Long

that. with start I'll Doug. is This Sure.

So large yes, Bend Florida was X from into and North way CAT and Hurricane coming Georgia. a then hurricane Helene to Carolina. the all obviously, is Big a across

really that we saw in so seen haven't my career. I And something

the it's significant market So point, area. to in in stumpage and it's that had -- a definitely impact your impacted

of acres through acres we've million a couple Florida much impacted still And land and that Georgia. were and backlog in of a cleaned of basically. had that XX lot over we pretty seeing So up, we're people forest only thousand working while other

going that year. headwinds that's the expect of create do the to we so first into some going half And

wood imagine based crews baskets. are self a of that of pivoted also from of path operations and timber the damaged and salvage then both can You most there within underway, scale, the neighboring on lot that

us afforestation wood this as our was ] were of to unexpected takers it higher seeing drop a costs. to basket led impact so that we're volume wood try to reduces in order much Georgia in owners was steep the small, timberland influx [ the pricing up price damaged, of clean that really while So in to

dynamic that. thought what QX. it that the the but So down originally sooner, entirety that of there's wood we a there for pricing winding market length the would contended we've is of in be And lot that of seen from with

continue salvage so And operations. on people with their

And sometime that it the and first in think XXXX a going do half that at so we wrap should half. first headwind into see being least of up

and So around that. volumes to your point, working we're staging our

geographic are we able we have, areas. harvest the diversity other to in With

So we're trying go as steady putting will to we particular problem not have rate the because exacerbate the flex into we to but continue much a by we ability areas, to more run pretty we have as go volume areas across geographic forward.

But is on our to we pricing. weigh do this going think geographic

we in we're area that. with So volume still meet that things to have we like do moving that that and commitments mills have

be our us going start for some to will headwinds it's So footprint, but can. we move the around we year as volume southern geographically to across

Mark McHugh

XXXX, a . Unfortunately, stumpage of overall be pretty X decline add to prior quarter, biggest to anticipating transitory quarter that Matt, but relates as anticipating that, that relates quarter the to XXXX. year-over-year we relative impact -- X fourth going this Doug impact, And said, or we're the was significant factor -- pricing. of it we year as quarter. I'd it's a driver quarters that like had in just in impact to this to we're really it the expect well, of

outlook the the that's So for major again, factors, that's one straining factor of U.S. pricing main in our not gains if the

South in XXXX.

a the lumber, we anticipating, production, lumber I pricing believe in in due market of in increased nice is Hopefully, the with And see which to we'll the that that, glut in Canadian South that coincides stumpage extent pickup the of pickup half. duties in through pretty back second could to as half a the the works really, we see start think everybody year. the volume, on tailwind to

that overall expectations South. our impact the full ongoing the again, certainly has volume in But gains muted for pricing year salvage

Matthew McKellar

Great.

for looks Next general me, terms timberland just are expectations outlook, your in what like market the M&A in XXXX? for of what

Mark McHugh

is portion a investments. Overall, $X on the M&A Mark. specifically or to acquisitions. there's targeting funds of of billion this estimate that. supply, to I'd about especially carbon for respect timberland outstrip to that properties. available climate-focused We higher-quality we demand those the billion And are I'll Yes, take market capital continued think has with $X that significant say

With for those a property lot the values of all successful we're still have seen seeing strong the paid higher-quality to market, market very on and that certainly outcomes said, assets. come assets whole hasn't recently, particularly been that transaction we being but there

medium-sized the have over of in deals years U.S. the For couple past example, to there smaller been several

where seen we've of in value acre South, $X,XXX. excess per

think market we as on that unique as, assets, quite assets angle. again, right the limited relatively with for overall, still So the especially is now. volume competitive, again, market well But quality higher carbon

for As acquisitions, now as the financing as make timberland given buying it to cost really debt appetite our capital, to costs timberland it's math assets. right relates our tough well overall on our of work

per market acre pursuing. competitive, M&A up. move to is those the timberland be higher-quality we would And Again, we've continued generally for especially values highly see those assets, which are the ones that

in May Creek South the average acre the per example, For acre value U.S.

acre, XXXX. sits about currently is per $XX.XX X% at from roughly year-end which South up

our timberland momentum share So, seen same that for with said, all that assets in value haven't we reflected price.

well a the selling our year towards assets, you to with rather So been over view know, advantage putting sheet positioning as in take both improving than balance of share buyback as position opportunities. a as we've buying past assets ourselves

So in stock. buy public and the timberland us think short, market best own our is I'd certainly say in place now right for that we buying by assets the cheapest back the place to

Operator

is caller next with Mark Seaport. Our Weintraub

Mark Weintraub

own that rural sales. versus you generally? be How to you much the values these anything some you might bit got happening strong I the the specifics a of feel where land little color in of of very on were very, more markets the was was hoping on selling the that lands get more properties you

Mark McHugh

our is that pulling kudos quarter. real those our very to strong back-end to together team was team the which transactions this saying fourth year loaded. We entering really be heavily Mark. quarter, to knew by the what results. Mark, worked was pipeline I'd to an exceptional major The going estate start very for contributed in several hard close

to achieve, able HBU pleased quarter. particularly our And overall, quality really that been the we think So been very portfolio. in the reflects of we've we've the fourth with that, pricing

pricing is to our also we big think is think generate what that continue think appreciated don't We industry-leading fully a also And our estate of HBU are story this part part It's on real we and value transactions. the that story. really market. creation by our premiums we of

as and context, sold noted, for $X,XXX. achieved acres price properties we HBU per development about acre fourth a the X,XXX you of weighted in quarter, average Again, unimproved of

was within see and momentum continue build able pleased our impressed team to that there, we what the with HBU to very again, So portfolio. accomplish and

Mark Weintraub

Mark, you was took it of that that were portion the to high what that tended see what swath that a were the up? did -- Or extremely average you across higher? be averages And certain was selling

Mark McHugh

were the more that And we to dial. quarter. had major of in we've those on more transactions. of estate or tend be past, real can going anticipated. as really why Well, transactions into ended there lumpy. for up that's the those X transactions results X They quarter, to expectations We that in driven pipeline be tend Again, number said estate ultimately, the we the muted were in a fourth move the real heavily than by converting

$XX,XXX transaction of excess in per an There was was that X development transaction unimproved acre. particular in

I X,XXX acres was total. just that think in over

of types business. pleased rural the our And average. again, quarter. we're those those But again, going results the don't certainly seeing to transactions, every you with have overall, HBU So very when that's in get skew you

Mark Weintraub

time particular. in then -- you're and years any you a that alternative comments more away? meaningful And are see update you still expected to appreciated could on land it's going we lines. the Do solar any X anticipate I you. pickup in solar Got Or thinking If this year? revenue year, on

April Tice

Yes, take Mark, I'll that.

we solutions XXXX. financial contribution really about in were pleased from the So land-based

so contribution do year. almost progressing. provide we could grow time, we you it under was that the over saw So visibility the year. under CCS $XX in the acres as about and out to course supplement, you we're that broke and in lease and see of million the happy why supplement, that's for for over we're how expect solar in the this And growth We the the the option had

the solar leases. in and is revenue option solution the sales payments rents land our of base bulk for The CCS

have revenues off inherently be so a still as portfolio it now are up. base. in limited counterparties, of And number those to ramps growing relatively the they We small and churn a going we're right

where of forward, believe So at pieces. point get agreement about be really rate fair can't of impact of would the that any million yet, we by a or we I for the to least assume at this quarter trajectory $XX particular a year that some into going a associated we're with the NDAs at or not moving run Investor the individual But point, given of we'd say we're on lease we any the XXXX. Day EBITDA communicated in that especially overall,

Mark McHugh

fairly be that, years those -- arena. at reiterated X, of we long Investor as it, XXXX. beyond land-based tend Again, from major that land-based them now, in Mark, Day, there of and timetables we right I X in occur to like probably will solutions solutions discussed anticipate years I really our call projects. recognize permitting certainly contribution more most pickup are all just to be pipeline the CCS. with that in CCS to that X in contributors tend essentially solar, so that X associated Those solar to

you been years X X over pipeline. from I has really the converting leases is source start predictable get to last in flow regularity. is think the converting portion leases higher becomes of into bulk leases of more where CCS of a cash to that a of where really growth. it's degree -- some the solar you building over kind so that there of that arena of some options in that to annually, and into injection converting options like royalties base with see up And But we'd and have solar into stabilized years activity probably where And now that

to CCS occur can a permits, to see more fairly those in again significant complex injection but to very is years be that start again, building, around going expect way achieve. couple that with happy more how out. really is be to ramp a pipeline of binary which But we

Mark Weintraub

a jump first. let follow-up, others you Okay. but to on if get I'll back have I'll

Operator

Our Roxland Mike next Truist. caller is with

Michael Roxland

question. Just to finished I that's is are first at -- come corporate -- the guess with realignment? continuing pursue your to there this you more Or and point, are you

throughout portfolio? be, Second are your ways drive that to other question would looking efficiency you're there

April Tice

Yes, take I'll that.

we're at current So at a keep our examination, always general, I environment. we've to the say close particularly done from expenses in point, operating looking ways this would a realignment, given eye corporate but on

a -- we in do OP have so And large how fresh U.S. so field almost that base over I the took and organized anticipate both looking mean, dispositions asset we our we by recall at that. at the of course, look our XX were XX%. the last reduced And operations months,

the South Pacific and Northwest.

a to for corporate. that that overhead wanted ways we that's ways did it We're that where looked our at also really We the efficient. at say did cost in be and we grow and only the effort. our not we reduce -- to were operations, areas solutions. the We in how putting in were resources making to streamline looking sure processes continuous but our would to our that always I looking allocating we particularly and land-based and

And a for point, ways taken so that's those year. be this looking and and efficient. to more not this We're for that impact always one from the we've But actions done.

Michael Roxland

of And to looks U.S. Orange, make IP's like Got Texas. in site secondly, it is going it. Gypsum closed then use just

acreage I around think had and you some there. simple

over can to from benefit talk operations? chips up potential you So bring any Rayonier as about U.S. and property takes starts the

Douglas Long

fiber see learn that about broaden understand get that to that be the be Understand virgin that. mill. Sure. announcement recycled they to mill. about not use basically still This We're we haven't intend percent waiting some what for plans you to Yes, that is happy to more answer loop Doug. in are chips will I'll and -- versus their fiber, recycled fiber. we're been would

to question. a early able that it's be too address So to little yet

actually we're where once So waiting this and to find completed out that they've goes.

Michael Roxland

we regard real But there probably it. could sense? they be will your use say fiber some upside some . Got is Doug,

Douglas Long

this be fiber, would virgin they sure hurry that If know do use just not yet it's we're are. market, plans at the what in but to time. point now, for Right me definitely positive that for

Michael Roxland

turning on. last then question And one before

Just on to Obviously, momentum that. cuts you driving lot solutions. of a land-based for

to they're $XX the IRA. And bump to disbursements from Just any that a $XX, looking -- curbing you from in the what of and obviously, ton do new $XX in intent ton. a credits they're the administration guys concerns about terms got

disbursed wind, like And the from new from certain curtails so IRA onshore if if the approvals administration both suspended they, and they've offshore. let's things suspend say, for approvals

I looking X project think New they just do. Jersey to were stopped

they're ESG sure, new the and make about around led have to concern land-based reservations what administration you want solutions. any doing So

Douglas Long

it how Sure, Doug the it's again. all unknowns Yes, how know going are I think out. play administration. a or days every there's it's And still of to for as early relates to day, new we lot

some in, go come out Some hours. XX within

goes. that like that not been offshore said, mentioned are initiatives that how to That's been favored. vehicles it's watching pretty we're wind you related documented the So But clear. and well electric

to impact land-based continue in the business, unpopular and had We our lot southern to on IRA that states. or entirety key that legislation would driving in meaningfully of think and those rural particularly some be are solutions to a provisions complex the job its given particularly it has roll the that repeal in very of really duration the growth back

of and jobs read last read From recently, congressional the districts based IRA created year. on XX% of Republican we investments the in newly what XX% about were the approximately state I've

money So the the particular. is of and a in lot into flowing South that rural South

FAST those mentioned COX the and that for his extended and first carbon IT and oil technology, investments in in capture Act promote does of you that. lot XXQ focusing the made to and fossil Act. President of the particular, align but about credits, expansion gas of tax And have pipelines USE the made eligible credits IRA, including forward, law term a Trump under storage, storage, Class it the for look streamlined with multinational carbon companies X signed via capture the fuels, wells permitting And on significant his during in also going some

of about we've So outside fits you heard think the are multinationals have the ability, with made it the cut as drill U.S., baby commitments mantra from drill. well that the

carbon capturing to continues the storage, by fuels. capture use fossil allow of it So those

mentioned capture political post carbon X reliant landscape that that well Mark the in think is on the still election. still current we we and positioned So the closed

had good we've feedback So with. from people and comments working we're

that a no Day we amplified interest hungry particularly as the was seeing doubt on already curve of development even steep year, developments growth And our we're industry, at from demand lot incentives on out solar, given from clean the last a IRA, solar see before our there's growing tech them. Investor solar we energy laid strong

rate the So we drove expect coming years. on favorable growth remain on

Michael Roxland

it. Appreciate color. Got the all

Operator

next Citi. is our And Anthony Pettinari call with

Anthony Pettinari

to much expecting down think in Pacific be bridging to the for non-timber anything it's kind gap a costs? Just Northwest, guide relatively larger you're looking think kind of kind a EBITDA despite of activity flattish at I I appreciation. with or Is modest something harvest bit price reduction the of of there, there kind little whether

the Or the the Northwest any the quantification on -- And kind year? we'll average kind and about of that export this maybe impact kind pricing see out of then can of disposition and of Pacific talk XX? plans Washington you just of Pacific to of Sawtimber Northwest

Mark McHugh

that Anthony, of question. part couldn't first we the hear

you could It it? muted? So I'm really sorry, repeat just was

Anthony Pettinari

Sorry.

in Pacific reduction year-over-year appreciation. modest what of of to big kind expecting price Northwest, a down EBITDA harvest terms like looks in flattish you're despite maybe I think Just to be pretty modestly and

understand to else that wanted there if just there's bridging the So anything gap. is

Mark McHugh

I be tends of small non-timber in really don't that in the think growth we're in it's income, contributor expectation improvement some any I think which relatively material Northwest. pricing. a function Pacific of underwriting there a to

of overall asset -- guide we XXXX, So sorry, to even yes, that despite recognized XXXX recognize XX% about sold relatively I'm our there. again, is -- though base that flat that

relative pricing higher XXXX implies certainly in that 'XX? to So of expectation

Douglas Long

that the some to lower add I'd to we that operations. to thing cost on only dispositions logging The do expect based with is had, have have our we Yes. respect

some of the of ground the out. So we steeper higher some sold further

increase residual that footprint had on post we the dispositions. mentioned, based are we seeing we price So in addition that Mark looking cost savings that will, to also at the

Mark McHugh

Yes.

year? acre So on you anticipating to the an that at given per again, pretty acreage EBITDA per certainly, basis, if pickup material look relative we're last acre on EBITDA a reduced

Anthony Pettinari

was it And it terms average? much the regional close? versus mix average pricing is of -- Is impact Or the of there? sawtimber of pretty a disposition how in sort

Mark McHugh

as topography than as I portfolio said, Doug improving those a that we as percentage our felt operating and as And at just though a which so the that they at Northwest we bit were dispositions time portfolio. like Hemlock to the the cost dispositions, across generally sold portfolio, overall heavier of given is operating well those the cost mean announced to a those both the Douglas Hemlock fir, Pacific trade overall properties going that discussed premium we given were to higher average. quality of we just had the

Anthony Pettinari

Okay.

on any you then, tariffs. Mark, I indirect remarks, if think you just finer mentioned helpful. prepared wondering could impact -- maybe of regions? And point That's kind your X direct I'm maybe tariffs in Okay. of on your or

Mark McHugh

incremental as to a lead on to universal higher direct tariff certainly manufacturing the a U.S. of not the shifting the I that like companies, at closely Look, anticipating right prices U.S. mean XX% any Clearly, monitoring lumber impact least not we're tariff likely term. lot production lumber. we're Canadian other as now. the would given into goods short we're well lumber situation in

certainly lumber a for would timberland and corollary would positive being to be positive producers, for this there owners. a a that be is view prevailing The

on the lumber latter That said, noting from play, or new to duty tariffs rates not whether come assessed expected that significantly Canada it's higher this existing half of being year. in worth reset into are currently the

higher it occurs, benefit rates this assuming higher both at likewise U.S. similarly as translate well U.S. prices that in would the pricing we to which would expect lumber So mills, as would sawlog operating

from we through move factor Northwest, competes Western we dynamic the in Pacific log especially This as that year, prices which directly SPF how certainly think to with Canada. is a more in kind of about contributing the improvement

to all that effects be need could With we counteract knock-on I also mindful the of that think phenomenon. this said, potential

strained construction increases, a to translate potentially and could further prices example, remodel. this affordability, demand, for housing interest For products, in well pullback it both of increased home as building broader repair new or as rate

as positive, relates So well there tariffs, here a as as to net of puts timberland balance, takes but some and kind be lumber on producers Rayonier. short-term again, expect it certainly overall, for could like we owners

Anthony Pettinari

helpful. I'll over. turn very That's it Okay.

Operator

[Operator Instructions].

Ketan is caller BMO Capital next Mamtora Our Markets. with

Ketan Mamtora

a Clearly, balance of program. the progress you've sheet net the First on side the made question asset disposition with lot leverage. on

here As need capture any you more will what talked do focused think from be guys disparity you a can on today, on . we sales sheet about? to more do values standpoint? that further kind Or balance kind you'll of the sit of you

Mark McHugh

Ketan, this is Yes, Mark.

first discussed announced As achieve to front we the pleased the we're calls, prior XX we've on to disposition we recall very objectives. on had with what been that date. X able When months plan we ago,

our net to that assets debt at disconnect leverage market shareholders. the reduce was was Xx to to of portion net this a private in EBITDA second capitalize capital on lower. to we public-private First or And that saw market and monetizing by the values returning

average of of forma forma recent X.Xx. believe -- net current almost about weighted completed XXx. timberland the dividend special And our to pro X.Xx around about forma pro debt million we've then, I'm multiple at it's for special Since a or dividend, the year-end, sorry, X.Xx pro dispositions I at EBITDA for $XXX EBITDA is

do value out all to with that generated think we significant along set for So long I'd achieving putting we've plan. a And gone towards way shareholders way. together, we've the what we the very accretion say our

we think of here, our still disposition of have terms profile. I'd on in very we structure position approach. focused a our to In target. now luxury capital our terms very we're of billion in right that where We're I patient getting in and $X say debt advantageous from go sitting that opportunistic and being But the

be can So to patient afford here. we again,

only we they options But going pursue we're think strategic maximize Ultimately, enhance value as for opportunity additional to exists. if We still our be that, and we dispositions that positioning to going our assess going again, think opportunistic shareholders. we're forward.

Ketan Mamtora

that that targeted? you where exceptionally kind this open sort values, in nothing there's If a you overshooting kind number $X of get be But would helpful. you all That's to something of where Mark. billion cap, you of Understood, a is strong find $X right? have billion

Mark McHugh

compelling still certainly assets And values $X to were or us we doing averse acquisitions, various to around on Yes. if to the flexibility transactions, which that deliberately to those other we're into billion able the exceed if Look, timberland looking more overshoot achieve to not again, target, considering. we're we so not exchange have give the potential we're but distribution. redeploy opportunities growth that proceeds target, potentially flexibility like-kind some would some particular, through we're in

think where I of buyback we look if Alternatively, shareholders, to certainly delever given right compelling that's now, how is. and feel stock we return especially opportunity, kind we further to a could see the capital which

portfolio with with nimble value long-term building always mindset of We've per a view capital share. allocation that management. really active towards and operated

to mindset going additional that we're continue to so adhere And as consider dispositions. to we

Ketan Mamtora

one then and Understood. perhaps here And as in well. can question, chime Doug other

If you look at U.S.

lumber over the production South, last years, U.S. increase XX in seen in the we've significant

billion call markets XX not look feet coastal to right, you and sort the actually board also Yet, like roughly. billion the XX from during Southern Georgia. board log prices at some the just South, and prices but southern average, if they wood of it feet pulp Florida in are down, years, same of XX

as period production confidence So and I'm that today, curious, sort gives in as you what of as the U.S. you XX-year we sit more lumber comes look here at that

will South log prices? that increase southern we in see

Mark McHugh

shifting in several last unpack move anticipated. sorry, -- dynamics have lot timber prices dynamics in of years as been that to I south have a a question, higher the as that think not lumber and Yes. Look, and over Ketan. There's been I'm had there caused lot much the

and and last, over that lumber. think it, driven again, we've why prices. has use a lumber there's here Pine between now of that been some persisted those recently, develop prices and exists of Yellow those seen around that of fair different I months is Southern And that for disconnect One types the been of lumber the call XX this certainly end just right dynamics discussion that's preferred SPF amount by why

a to a tends Southern construction, example, use use in preferred So for Yellow single-family to have preferred remodel. SPF and have in Pine tends repair

SPF the that's the that And repair pullback lumber. lumber between big and that, activity, with really that's think drivers developed disconnect of remodel been one so in of SYP our we

and the see come of that to we historically out had the continue U.S. been of that So more capacity production Canada thesis yes, as shifted to

or was South of that to shift the U.S. the thought it more would production

that translate have that to profitable and environment. SYP, say now for haven't the sawlogs. expected as I'd prices is that disconnect been or that, been demand type market South, the would we have has But in just mills right of now that between as this that given issue SPF right higher would Southern

where been are some Again, pretty of after resale the move. rapid right really, that drives people that we remodel right of spending. it's suffering mortgage issues transitory. resale kind the People expects sell the these I effect that should lock-in pick couldn't before either activity rates that think home, they a essentially And to And buy or activity it R&R has they afford again, limited. it. to tend that been the following do we in rise from and market think up. We've remodel or of -- this expect repair

irrespective I that a as that of create the is some in market for think meaningful pretty think see in be think we on the balance, a pickup in R&R should And pricing we we anticipated duties to that normalize. prices new meaningful think into pretty SYP we to tariffs think sawlog lumber southern could going higher. And kind well Again, again, prices We lumber of that, normalization you a lumber So come what's any think that should prices play. if couple could starting to both sawlog we're of after activity. midyear, that, tailwind more SPF. drive We uptick South. see with as SYP to relative

materialized but though timetable at time XX an But would here does your the point feel many the entering here different coming it hasn't points years, the in point years. over last it kind X, as we're inflection that have that on expected in of

Ketan Mamtora

perspective. appreciate I helpful. very That's that

Operator

And Mark Weintraub our comes with last Seaport. from question

Mark Weintraub

I hope I'll to really is it keep a fair this question. short. try

Or played or that strategic financial So a out can -- point? anything at any give Has this a Zealand. process given a when a year year be that ago should the to thinking you how about hired ago, ago. alternatives that evaluate that New us was we there announced is -- was year color largely for almost that help adviser you

Mark McHugh

the in when strategic has there. don't strategic have we actively this that of still Zealand on complexities alternatives process specific at engaged anything that evaluation a that report initially that given some process joint be Recall that New we to We lengthy than Yes. announced indicated process we not very there. point That we say to of of New Zealand, that other of venture concluded. review alternatives structure our expected for could are

still So through again, in we're a but working it, further to this not we're at position point. comment

Operator

am time, I at And showing no further this sir. questions,

Collin Mings

All is like to Collin follow-up everybody right. questions. joining with any This Please Mings. thank for contact us. I'd us

Operator

Thank you. conference call. This today's concludes

You this time. at disconnect may and go ahead

Rayonier (RYN) 6 Feb 252024 Q4 Earnings call transcript