Rayonier Inc. (NYSE:RYN) Q1 2024 Earnings Call Transcript

Rayonier Inc. (NYSE:RYN) Q1 2024 Earnings Call Transcript May 2, 2024

Rayonier Inc. isn't one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Operator: Welcome, and thank you for joining Rayonier's First Quarter 2024 Conference Call. [Operator Instructions] Today's conference is being recorded. 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. Welcome to Rayonier's investor teleconference covering first quarter earnings. Our earnings statements and financial supplement were released yesterday afternoon and are available on our website at rayonier.com. I would like to remind you that in these presentations, we include forward-looking statements made pursuant to the safe harbor provisions of federal securities laws. Our earnings release and Forms 10-K and 10-Q filed with the SEC list some of the factors that may cause actual results to differ materially from the forward-looking statements we may make. They are also referenced on Page 2 of our financial supplement. Throughout these presentations, we will also discuss non-GAAP financial measures, which are defined and reconciled to the nearest GAAP measures in our earnings release and supplemental materials. With that, let's start our teleconference with opening comments from Mark McHugh, our President and CEO. Mark?

Aerial view of Timberland Real Estate Investment Trust's woodlands in the U.S. South and Pacific Northwest.

Mark McHugh: Thanks, Collin. Good morning, everyone. First, I'll make some high-level comments before turning it over to April Tice, Senior Vice President and Chief Financial Officer, to review our consolidated financial results. Then ask Doug Long, Executive Vice President and Chief Resource Officer, to comment on our U.S. and New Zealand Timber results. And following the review of our timber segments, April will discuss our real estate results and our outlook for the balance of the year. As this is my first earnings call since officially stepping into the CEO role, I want to reiterate how honored I feel that our Board has entrusted me to lead Rayonier at this exciting time for our company. I'm fortunate to be partnering with an experienced and dedicated team of senior leaders, all of whom are incredibly energized by the refreshed vision that we've laid out for Rayonier and eager to execute on our future growth opportunities.

On that note, I'd like to also formally welcome April to our earnings call this quarter in her new role as CFO. April has held multiple positions of increasing responsibility within the finance and accounting department since she joined Rayonier in 2010, most recently serving as our Chief Accounting Officer for the last three years before she assumed the CFO role last month. April has been instrumental in building out our finance and accounting department as well as implementing a transparent financial reporting framework for the company. I'm confident that her transition into the CFO role will continue to be seamless. Now I'll switch gears and discuss our first quarter results, which were modestly improved relative to the prior year quarter and in line with our expectations at the start of the year.

Specifically, we generated adjusted EBITDA of $56 million and pro forma net income of $7 million or $0.05 per share. The 3% increase in adjusted EBITDA versus the prior year period was driven by stronger results from our Southern Timber and New Zealand Timber segments, partially offset by lower results in our Pacific Northwest Timber and Real Estate segments. Drilling down further on our operating segment results. Our Southern Timber segment generated first quarter adjusted EBITDA of $45 million, up $2 million from the prior year period, as a 6% increase in harvest volumes more than offset a 4% decline in net stumpage realizations. In our Pacific Northwest Timber segment, first quarter adjusted EBITDA of $5 million was down $2 million from the prior year quarter, driven by a 17% reduction in harvest volumes due to the Oregon sale completed late last year, as well as an 11% decline in weighted average log prices.

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