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Press release from PR Newswire

Weyerhaeuser Reports Fourth Quarter, Full Year Results

Friday, January 25, 2013

Weyerhaeuser Reports Fourth Quarter, Full Year Results03:05 EST Friday, January 25, 2013- Fourth quarter 2012 net earnings increased 22 percent compared with third quarter. - Full year 2012 net sales rose 14 percent and net earnings before special items increased 78 percent. - Total shareholder return for 2012 exceeded 50 percent.FEDERAL WAY, Wash., Jan. 25, 2013 /PRNewswire/ -- Weyerhaeuser Company (NYSE: WY) today reported net earnings of $143 million, or 26 cents per diluted share, for the fourth quarter. This compares with net earnings of $65 million, or 12 cents per diluted share, and net earnings before special items of $77 million, or 14 cents per diluted share, for the same period last year. Net sales for the fourth quarter of 2012 totaled $2.0 billion, compared with net sales of $1.6 billion for the fourth quarter of 2011.(Logo: http://photos.prnewswire.com/prnh/20120111/AQ34535LOGO)For the full year 2012, Weyerhaeuser reported net earnings of $385 million, or 71 cents per diluted share, on net sales of $7.1 billion. This compares with net earnings of $331 million, or 61 cents per diluted share, on net sales from continuing operations of $6.2 billion for the full year 2011."As I look forward to 2013, I am excited by the opportunity to build on the momentum of this past year," said Dan Fulton, president and chief executive officer. "In 2012, we began to realize the results of our work to position the company to capture the benefits of an improving housing market. As a result, our bottom line improved significantly, the Board increased the dividend, and our total shareholder return exceeded 50 percent, one of the best in our industry."WEYERHAEUSER FINANCIAL HIGHLIGHTS20122011(millions, except per share data)3Q4Q4QNet sales$1,772$2,000$1,615Net earnings$117$143$65Weighted average shares outstanding, diluted542547538Earnings per diluted share$0.22$0.26$0.12Net earnings before special items$117$143$77Earnings per diluted share before special items$0.22$0.26$0.14Net cash from operations$122$252$147Net change in cash and cash equivalents(1)($253)$290($18)Cash and cash equivalents at end of period(1)$608$898$953(1) Net change in cash and cash equivalents for the third quarter of 2012 includes $181 million for debt repayment and a $97 million payment on a note related to a timber monetization undertaken in 2002. Fourth quarter of 2012 includes $110 million received upon maturity of financial investments related to that timber monetization.TIMBERLANDS FINANCIAL HIGHLIGHTS (millions)3Q 20124Q 2012ChangeNet sales$267$298$31Contribution to pre-tax earnings$80$95$154Q 2012 Performance - Earnings increased compared with the third quarter due to improved selling prices and stronger market demand for export and domestic logs. Fee harvest volumes increased in both the West and the South. Earnings from disposition of non-strategic timberlands decreased $5 million.1Q 2013 Outlook - Excluding dispositions of non-strategic timberlands, Weyerhaeuser expects earnings from the segment to be comparable to the fourth quarter. The company anticipates improved selling prices for Western domestic and export logs, offset by a seasonal decline in Southern fee harvest volumes. Earnings from dispositions of non-strategic timberlands are expected to decrease.WOOD PRODUCTSFINANCIAL HIGHLIGHTS (millions)3Q 20124Q 2012ChangeNet sales$816$832$16Contribution to pre-tax earnings$59$38($21)4Q 2012 Performance - Stronger than expected market conditions for oriented strand board and lumber resulted in higher average selling prices and sales volumes for those products. However, all product lines experienced higher raw material costs. Engineered wood products operating rates decreased due to maintenance and seasonally weaker market conditions.1Q 2013 Outlook - Weyerhaeuser anticipates significantly higher earnings from the Wood Products segment in the first quarter. The company expects increased average sales realizations for lumber and oriented strand board and seasonally higher sales volumes across all product lines. Unit manufacturing costs are expected to decline due to improved operating rates, partially offset by higher raw material costs.CELLULOSE FIBERSFINANCIAL HIGHLIGHTS (millions)3Q 20124Q 2012ChangeNet sales$459$463$4Contribution to pre-tax earnings$78$61($17)4Q 2012 Performance - Average sales realizations for pulp declined, and chemical and energy costs increased. Sales realizations and volumes for liquid packaging board decreased due to operational issues that are now resolved. These factors were partially offset by lower maintenance costs and improved pulp mill productivity due to fewer days of scheduled annual maintenance outages.1Q 2013 Outlook - Weyerhaeuser expects lower earnings from the Cellulose Fibers segment in the first quarter. The company anticipates increased maintenance expenses, partially offset by slightly higher average selling prices for pulp.REAL ESTATE FINANCIAL HIGHLIGHTS (millions)3Q 20124Q 2012ChangeNet sales$230$407$177Contribution to pre-tax earnings$17$81$644Q 2012 Performance - Fourth quarter included earnings of $16 million from single-family homebuilding and $65 million from land sales, compared with $17 million from single-family homebuilding in the third quarter. Home closings increased seasonally to 842 single-family homes. Average margins on homes closed declined to 20 percent due to mix, and selling costs increased due to the additional closing volume.At the end of the fourth quarter the backlog of homes sold, but not closed, totaled 774 units, compared with 429 units one year ago.1Q 2013 Outlook - Weyerhaeuser anticipates a slight profit from single-family homebuilding in the first quarter. Home closings should decline seasonally to approximately 500 homes, with margins comparable to fourth quarter. Selling expenses are expected to decrease due to lower closing volumes.ABOUT WEYERHAEUSERWeyerhaeuser Company, one of the world's largest private owners of timberlands, began operations in 1900. We own or control more than 6 million acres of timberlands, primarily in the U.S., and manage another 14 million acres under long-term licenses in Canada. We manage these timberlands on a sustainable basis in compliance with internationally recognized forestry standards. We are also one of the largest manufacturers of wood and cellulose fibers products, and we develop real estate, primarily as a builder of single-family homes. Our company is a real estate investment trust. In 2012, we generated $7.1 billion in sales and employed approximately 13,200 people who serve customers worldwide. We are listed on the Dow Jones World Sustainability Index. Our stock trades on the New York Stock exchange under the symbol WY. More information about us is available at www.weyerhaeuser.com.EARNINGS CALL INFORMATIONWeyerhaeuser will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on Jan. 25 to discuss fourth quarter results.To access the conference call from within North America, dial 877-296-9413 (access code ? 86484844) at least 15 minutes prior to the call. Those calling from outside North America should dial 706-679-2458 (access code ? 86484844). Replays will be available for one week at 855-859-2056 (access code ? 86484844) from within North America and at 404-537-3406 (access code ? 86484844) from outside North America.The call is being webcast through Weyerhaeuser's Internet site at http://investor.weyerhaeuser.com and is accessible by selecting the "Q4 2012 Weyerhaeuser Co. Earnings Conference Call" link.The webcast is available through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at www.fulldisclosure.com, Thomson's individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson's password-protected site, StreetEvents (www.streetevents.com).FORWARD LOOKING STATEMENTS This news release contains statements concerning the company's future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on various assumptions and may not be accurate because of risks and uncertainties surrounding these assumptions. Factors listed below, as well as other factors, may cause actual results to differ significantly from these forward-looking statements. There is no guarantee that any of the events anticipated by these forward-looking statements will occur. If any of the events occur, there is no guarantee what effect they will have on company operations or financial condition. The company will not update these forward-looking statements after the date of this news release.Some forward-looking statements discuss the company's plans, strategies and intentions. They use words such as "expects," "may," "will," "believes," "should," "approximately," "anticipates," "estimates," and "plans."  In addition, these words may use the positive or negative or other variations of those terms.This release contains forward-looking statements regarding the company's expectations during the first quarter of 2013, including improved selling prices for Western domestic and export logs, a seasonal decline in Southern fee harvest volumes, decreased earnings from dispositions of non-strategic timberlands, and comparable earnings from the Timberlands segment excluding disposition of non-strategic timberlands; increased average sales realizations for lumber and oriented strand board, seasonally higher sales volumes across all product lines, improved operating rates, higher raw material costs, and significantly higher earnings from the Wood Products segment; increased maintenance expenses, slightly higher average selling prices for pulp, and lower earnings from the Cellulose Fibers segment; and seasonally lower home closings, comparable margins, decreased selling expenses due to lower closing volumes, and a slight profit from single-family homebuilding in the Real Estate segment.Major risks, uncertainties and assumptions that affect the company's businesses and may cause actual results to differ from these forward-looking statements, include, but are not limited to:the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages, and strength of the U.S. dollar; market demand for the company's products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; performance of the company's manufacturing operations, including maintenance requirements; the level of competition from domestic and foreign producers; raw material prices; the effect of weather; the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters; energy prices; the successful execution of internal performance plans, including restructurings and cost reduction initiatives; transportation costs; federal tax policies; the effect of forestry, land use, environmental and other governmental regulations; legal proceedings; performance of pension fund investments and related derivatives; the effect of timing of retirements and changes in the market price of company stock on charges for stock-based compensation; changes in accounting principles; and other factors described under "Risk Factors" in the Company's annual report on Form 10-K and quarterly reports on Form 10-Q.The company also is a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan and China. It is affected by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the euro and the Canadian dollar, and the relative value of the euro and the yen. Restrictions on international trade or tariffs imposed on imports also may affect the company.Weyerhaeuser CompanyExhibit 99.2Q4.2012 Analyst PackagePreliminary results, subject to auditConsolidated Statement of Operationsin millionsQ1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Net sales and revenues$ 1,494$ 1,793$ 1,772$ 2,000$ 1,615$ 7,059$ 6,216Cost of products sold1,2901,5161,4241,5801,3175,8105,120Gross margin2042773484202981,2491,096Selling expenses4247495645194178General and administrative expenses10895107126104436423Research and development expenses788993230Charges for restructuring, closures and impairments124106313283Other operating income, net(66)(53)(28)(33)(22)(180)(212)Operating income101176202256131735594Interest income and other12111514125247Interest expense, net of capitalized interest(87)(86)(87)(88)(88)(348)(384)Earnings from continuing operations before income taxes2610113018255439257Income taxes15(17)(13)(40)10(55)62Earnings from continuing operations418411714265384319Earnings from discontinued operations, net of income taxes??????12Net earnings418411714265384331Add: net loss attributable to noncontrolling interests???1?1?Net earnings attributable to Weyerhaeuser common shareholders$       41$       84$     117$     143$       65$     385$     331Per Share Informationin millionsQ1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Earnings per share attributable to Weyerhaeuser common shareholders, basic:Continuing operations$     0.08$     0.16$     0.22$     0.26$     0.12$     0.71$     0.60Discontinued operations??????0.02Net earnings per share$     0.08$     0.16$     0.22$     0.26$     0.12$     0.71$     0.62Earnings per share attributable to Weyerhaeuser common shareholders, diluted:Continuing operations$     0.08$     0.16$     0.22$     0.26$     0.12$     0.71$     0.59Discontinued operations??????0.02Net earnings per share$     0.08$     0.16$     0.22$     0.26$     0.12$     0.71$     0.61Dividends paid per share$     0.15$     0.15$     0.15$     0.17$     0.15$     0.62$     0.60Weighted average shares outstanding (in thousands):Basic537,368537,966539,094542,101536,432539,140537,534Diluted539,728540,033542,311547,137538,119542,310539,879Common shares outstanding at end of period (in thousands)537,409537,526540,672542,393536,425542,393536,425Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*in millionsQ1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Operating income$     101$     176$     202$     256$     131$     735$     594Depreciation, depletion and amortization113113112118117456476Non-operating pension and postretirement costs777852926Special items(38)(57)??19(95)(100)Capitalized interest included in cost of products sold31969123729Adjusted EBITDA, excluding special items*$     186$     258$     327$     391$     284$ 1,162$ 1,025* Non-GAAP measureWeyerhaeuser CompanyQ4.2012 Analyst PackagePreliminary results, subject to auditConsolidated Balance Sheetin millionsMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011ASSETSForest Products:Current assets:Cash and cash equivalents$        726$        857$        602$        893$        950Receivables, less allowances479488504468468Receivables for taxes246979522Inventories517487512531476Prepaid expenses8086838368Deferred tax assets1131001176581Total current assets1,9392,0241,9152,1352,065Property and equipment, net2,8292,7702,7592,8592,901Construction in progress19220822050145Timber and timberlands at cost, less depletion charged to disposals3,9703,9633,9673,9613,978Investments in and advances to equity affiliates189187188192192Goodwill4040404040Deferred tax assets50485618936Other assets442435352358444Assets held by variable interest entities91491691480591610,56510,59110,41110,58910,717Real Estate:Cash and cash equivalents24653Receivables, less allowances3038367241Real estate in process of development and for sale606581602658555Land being processed for development943959982904936Investments in and advances to equity affiliates1920202121Deferred tax assets246238233202240Other assets113899894113Assets held by variable interest entities?364781,9591,9321,9832,0031,917Total assets$ 12,524$ 12,523$ 12,394$ 12,592$ 12,634LIABILITIES AND EQUITYForest Products:Current liabilities:Current maturities of long-term debt$        167$        184$        340$        340$          12Accounts payable343360356329336Accrued liabilities536576558561593Total current liabilities1,0461,1201,2541,230941Long-term debt4,0264,0053,8423,8424,181Deferred income taxes158140124?129Deferred pension and other postretirement benefits1,4701,4291,3781,9361,467Other liabilities407400477493408Liabilities (nonrecourse to the company) held by variable interest entities7757786806817767,8827,8727,7558,1827,902Real Estate:Long-term debt283283109109285Other liabilities154171177187172Liabilities (nonrecourse to the company) held by variable interest entities???18437454286297465Total liabilities8,3198,3268,0418,4798,367Equity:Total Weyerhaeuser shareholders' interest4,1974,1864,3404,0704,263Noncontrolling interests81113434Total equity4,2054,1974,3534,1134,267Total liabilities and equity$ 12,524$ 12,523$ 12,394$ 12,592$ 12,634Weyerhaeuser CompanyQ4.2012 Analyst PackagePreliminary results, subject to auditConsolidated Statement of Cash Flowsin millionsQ1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Cash flows from operations:Net earnings$     41$     84$   117$   142$     65$   384$   331Noncash charges (credits) to income:Depreciation, depletion and amortization113113112118117456480Deferred income taxes, net(6)1315405162(26)Pension and other postretirement benefits(28)(30)192021(19)81Share-based compensation expense10810963725Charges for impairment of assets8475192456Net gains on dispositions of assets(7)(10)(22)(30)(9)(69)(236)Foreign exchange transaction (gains) losses(7)9(10)2(5)(6)6Change in:Receivables less allowances(5)(18)(10)?(19)(33)(53)Receivable for taxes(2)18(1)2(18)17(37)Inventories(40)28(22)(20)(6)(54)(46)Real estate and land(55)7(47)2037(75)(12)Prepaid expenses(8)(12)2217(16)3Accounts payable and accrued liabilities(56)651(5)(59)5(133)Deposits on land positions and other assets?22(11)(7)54(4)Pension and postretirement contributions(35)(33)(41)(36)(79)(145)(143)Other17(1)3(10)49(1)Net cash from operations(60)267122252147581291Cash flows from investing activities:Property and equipment(54)(68)(75)(59)(76)(256)(212)Timberlands reforestation(10)(7)(5)(7)(6)(29)(29)Proceeds from sale of assets6181244980362Proceeds of investments (payments of liabilities) held by special purpose entities??(97)110?13?Other1(1)(1)17?1Cash from investing activities(57)(58)(166)89(66)(192)122Cash flows from financing activities:Cash dividends(81)(80)(81)(92)(81)(334)(323)Change in book overdrafts(29)9(12)?28(32)2Payments on debt(2)(4)(181)?(33)(187)(583)Exercises of stock options526639111238Repurchase of common stock????(13)?(37)Other(1)(3)(1)2(1)(3)(24)Cash from financing activities(108)(76)(209)(51)(99)(444)(927)Net change in cash and cash equivalents(225)133(253)290(18)(55)(514)Cash and cash equivalents at beginning of period9537288616089719531,467Cash and cash equivalents at end of period$   728$   861$   608$   898$   953$   898$   953Cash paid (received) during the year for:Interest, net of amount capitalized$   116$     57$   117$     51$     58$   341$   420Income taxes$    (10)$     (5)$       1$       1$       7$   (13)$     28Weyerhaeuser CompanyTotal Company StatisticsQ4.2012 Analyst PackagePreliminary results, subject to auditSpecial Items Included in Net Earningsin millionsQ1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Net earnings$    41$    84$  117$  143$    65$  385$  331Income tax adjustments??????(83)Gain on sale of 82,000 acres of non-strategic timberlands??????(96)Loss on early extinguishment of debt??????16Restructuring, impairments and other charges10???121036Gain on postretirement plan amendment(34)(33)???(67)?Gain on sale of properties?(4)???(4)(9)Tax settlements(8)????(8)?Charges related to the sale of hardwoods??????14Gain on sale of Westwood Shipping Lines??????(31)Net earnings before special items$       9$    47$  117$  143$    77$  316$  178Q1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Net earnings per diluted share$ 0.08$ 0.16$ 0.22$ 0.26$ 0.12$ 0.71$ 0.61Income tax adjustments??????(0.15)Gain on sale of 82,000 acres of non-strategic timberlands??????(0.18)Loss on early extinguishment of debt??????0.03Restructuring, impairments and other charges0.02???0.020.020.07Gain on postretirement plan amendment(0.06)(0.06)???(0.12)?Gain on sale of properties?(0.01)???(0.01)(0.02)Tax settlements(0.02)????(0.02)?Charges related to the sale of hardwoods??????0.03Gain on sale of Westwood Shipping Lines??????(0.06)Net earnings before special items per diluted share$ 0.02$ 0.09$ 0.22$ 0.26$ 0.14$ 0.58$ 0.33Selected Total Company Items, Excluding Discontinued Operationsin millionsQ1Q2Q3Q4Year-to-dateMar 31, 2012Jun 30, 2012Sep 30, 2012Dec 31, 2012Dec 31, 2011Dec 31, 2012Dec 31, 2011Depreciation, depletion and amortization:Cost of products sold$   102$   103$   102$   109$   104$   416$   422Selling, general and administrative expenses1110109134054Total depreciation, depletion and amortization$   113$   113$   112$   118$   117$   456$   476Pension and postretirement costs:Pension and postretirement costs allocated to business segments$     13$     14$     12$     12$     12$     51$     46Pension and postretirement costs not allocated777852926Total company pension and postretirement costs$     20$     21$     19$     20$     17$     80$     72Total decrease (increase) in Forest Products working capital (1)$  (148)$   103$    (29)$    (85)$    (41)$  (159)$  (211)Cash spent for capital expenditures$    (64)$    (75)$    (80)$    (66)$    (82)$  (285)$  (238)(1)Working capital does not include cash balances.Weyerhaeuser CompanyTimberlands SegmentQ4.2012 Analyst PackagePreliminary results, subject to auditSegment Statement of Operationsin millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Sales to and revenues from unaffiliated customers$     250$     262$     267$     298$     274$   1,077$   1,044Intersegment sales190146162185167683646Total net sales and revenues4404084294834411,7601,690Cost of products sold3533133363743581,3761,290Gross margin87959310983384400Selling expenses22323910General and administrative expenses23212120188581Research and development expenses454661918Restructuring, closures and impairments???2?2?Other operating income, net(11)(10)(14)(14)(14)(49)(196)Operating income6977799370318487Interest income and other1?11134Loss attributable to noncontrolling interest???1?1?Net contribution to earnings?$      70$      77$      80$      95$      71$     322$     491Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*in millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Operating income$      69$      77$      79$      93$      70$     318$     487Depreciation, depletion and amortization3534353835142137Special items??????(152)Adjusted EBITDA, excluding special items*$   104$   111$   114$   131$   105$     460$     472* Non-GAAP measureSegment Special Items Included in Net Contribution to Earnings (Pre-Tax)Q1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Gain on sale of 82,000 acres of non-strategic timberlands$      ?$      ?$      ?$      ?$      ?$        ?$      152Selected Segment ItemsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Total decrease (increase) in working capital (1)$       (9)$         6$       19$     (37)$       (6)$      (21)$      (26)Cash spent for capital expenditures$     (12)$     (15)$     (17)$     (16)$     (13)$      (60)$      (53)(1)Working capital does not include cash balances.Segment StatisticsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Third Party Net Sales and Revenue (millions)Logs:West$     130$     146$     132$     151$     139$      559$      545South5056606753233196Canada725551917Total Logs187204197223197811758Pay as cut timber sales1198993734Timberlands exchanges872420155977Higher and better use land sales4549142225Minerals, oil and gas7789103153Products from international operations252926262710686Other products81?221111Total$     250$     262$     267$     298$     274$   1,077$   1,044 LogsThird Party SalesRealizations(per cubic meter)West$  99.10$  94.47$  89.28$  96.46$  99.71$   94.72$ 103.57South$  40.48$  41.15$  42.04$  43.30$  39.82$   41.83$   40.10Canada$  36.35$  34.66$  35.23$  38.70$  34.04$   36.51$   34.65International$  22.97$  23.53$  23.76$  24.30$  17.03$   23.66$   28.11 LogsThird Party SalesVolumes(cubic meters,thousands)West1,3081,5511,480.1,5591,3965,8985,267South1,2281,3541,430.1,5631,3275,5754,879Canada20554133.139146531479International788299.8475343314Total2,8193,0413,1423,3452,94412,34710,939 LogsFee Harvest Volumes(cubic meters,thousands)West1,6791,8311,784.1,8761,6337,1706,595South2,7142,7882,809.3,1772,66811,4889,738International172161198.232265763854Total4,5654,7804,7915,2854,56619,42117,187Weyerhaeuser CompanyWood Products SegmentQ4.2012 Analyst PackagePreliminary results, subject to auditSegment Statement of Operations  in millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Sales to and revenues from unaffiliated customers$     634$     776$     816$     832$     542$    3,058$    2,276Intersegment sales20201816197480Total net sales and revenues6547968348485613,1322,356Cost of products sold6117087137485732,7802,359Gross margin4388121100(12)352(3)Selling expenses21212324198979General and administrative expenses2929313427123113Research and development expenses1121154Charges for restructuring, closures and impairments122120664Other operating costs (income), net5(1)42(2)10(17)Operating income (loss)(14)365938(77)119(246)Interest income and other1????13Net contribution to earnings from continuing operations(13)365938(77)120(243)Net contribution to earnings from discontinued hardwoods operations??????(25)Net contribution to earnings?$    (13)$      36$      59$      38$    (77)$     120$    (268)Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*in millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Operating income (loss)$    (14)$      36$      59$      38$    (77)$     119$    (246)Depreciation, depletion and amortization3433333335133151Special items?(6)??19(6)52Adjusted EBITDA, excluding special items*$      20$      63$      92$      71$    (23)$     246$      (43)* Non-GAAP measureSegment Special Items Included in Net Contribution to Earnings (Pre-Tax)  Q1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Gain on sale of property$      ?$         6$      ?$      ?$      ?$           6$           5Charges for restructuring and impairments????(19)?(57)Total special items from continuing operations?6??(19)6(52)Charges related to sale of discontinued hardwoods operations??????(22)Total$      ?$        6$      ?$      ?$    (19)$          6$      (74)Selected Segment ItemsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Total decrease (increase) in working capital (1)$   (112)$         5$     (21)$         9$       18$     (119)$       (23)Cash spent for capital expenditures$       (6)$     (15)$     (16)$     (19)$     (14)$       (56)$       (35)(1)Working capital does not include cash balances.Segment Statisticsin millions, except for third-party sales realizationsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Structural Lumber(board feet)Third Party Net Sales and Revenue$     291$     370$     363$     376$     256$    1,400$    1,087Third Party Sales Realizations$     311$     350$     359$     366$     296$       347$       303Third Party Sales Volumes9371,0561,0131,0258634,0313,586Production Volumes9581,0049459398423,8463,528Engineered SolidSection(cubic feet)Third Party Net Sales and Revenue$       65$       70$       76$       68$       55$       279$       235Third Party Sales Realizations$  1,830$  1,789$  1,800$  1,817$  1,783$    1,808$    1,920Third Party Sales Volumes3.63.94.23.73.115.412.3Production Volumes3.73.84.33.62.715.413.4EngineeredI-joists(lineal feet)Third Party Net Sales and Revenue$       41$       49$       53$       47$       37$       190$       161Third Party Sales Realizations$  1,285$  1,211$  1,248$  1,265$  1,258$    1,250$    1,264Third Party Sales Volumes3240433730152128Production Volumes3437393726147122Oriented StrandBoard(square feet 3/8')Third Party Net Sales and Revenue$     111$     138$     169$     194$       90$       612$       354Third Party Sales Realizations$     197$     214$     268$     290$     173$       244$       179Third Party Sales Volumes5656436306705162,5081,977Production Volumes6016266426425412,5112,127Softwood Plywood (square feet 3/8')Third Party Net Sales and Revenue$       23$       26$       34$       32$       18$       115$         66Third Party Sales Realizations$     309$     332$     356$     347$     274$       338$       264Third Party Sales Volumes7381959165340249Production Volumes5150545947214197Weyerhaeuser CompanyCellulose Fibers SegmentQ4.2012 Analyst PackagePreliminary results, subject to auditSegment Statement of Operationsin millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Total net sales and revenues$   473$   459$   459$   463$   523$  1,854$  2,058Cost of products sold4074043643853681,5601,524Gross margin66559578155294534Selling expenses454551818General and administrative expenses20171918197476Research and development expenses2222288Charges for restructuring, closures and impairments????1?1Other operating income, net(9)(4)(5)(6)(7)(24)(19)Operating income49357559135218450Interest income and other(1)132152Net contribution to earnings?$      48$      36$      78$      61$   136$     223$     452Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*in millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Operating income$      49$      35$      75$      59$   135$     218$     450Depreciation, depletion and amortization3736374037150147Adjusted EBITDA, excluding special items*$      86$      71$   112$      99$   172$     368$     597* Non-GAAP measureSelected Segment ItemsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Total decrease (increase) in working capital (1)$       45$       24$     (20)$     (30)$     (28)$         19$       (65)Cash spent for capital expenditures$     (45)$     (44)$     (45)$     (26)$     (54)$     (160)$     (146)(1)Working capital does not include cash balances.Segment StatisticsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Pulp(air-dry metrictons)Third Party Net Sales and Revenue (millions)$     367$     348$     354$     364$     419$    1,433$    1,617Third Party Sales Realizations$     818$     819$     818$     799$     895$       813$       921Third Party Sales Volumes (thousands)4494254324564681,7621,756Production Volumes (thousands)4384174534654601,7731,769LiquidPackagingBoard(tons)Third Party Net Sales and Revenue (millions)$       83$       90$       84$       75$       81$       332$       346Third Party Sales Realizations$  1,181$  1,176$  1,155$  1,085$  1,151$    1,150$    1,165Third Party Sales Volumes (thousands)7076746970289297Production Volumes (thousands)6578777279292307Weyerhaeuser CompanyReal Estate SegmentQ4.2012 Analyst PackagePreliminary results, subject to auditSegment Statement of Operationsin millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Total net sales and revenues$   137$   296$   230$   407$   276$ 1,070$     838Cost of products sold113248175276191812628Gross margin24485513185258210Selling expenses15191925187871General and administrative expenses17151727197673Charges for restructuring, closures and impairments113110614Other operating income, net?(1)?(1)(1)(2)(1)Operating income (loss)(9)1416793910053Interest income and other1112255Net contribution to earnings$      (8)$      15$      17$      81$      41$     105$       58Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*in millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Operating income (loss)$      (9)$      14$      16$      79$      39$     100$       53Depreciation, depletion and amortization233441213Capitalized interest included in cost of products sold31458103023Adjusted EBITDA, excluding special items*$      (4)$      31$      24$      91$      53$     142$       89* Non-GAAP measureSelected Segment ItemsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Cash from operations$     (32)$       43$     (24)$       77$       43$        64$        18Cash spent for capital expenditures$       (1)$      ?$       (1)$       (2)$       (1)$        (4)$        (3)Segment StatisticsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Net sales and revenues:Single-family housing$     131$     190$     229$     320$     232$      870$      768Land31051844419367Other31?3?73Total net sales and revenue$     137$     296$     230$     407$     276$   1,070$      838Single-family homes sold6977646375614062,6591,902Single-family homes closed3495086158425822,3141,912Single-family homes sold but not closed (backlog)7771,0331,055774429774429Single-family cancellation rate10.1 %15.4 %18.3 %15.9 %18.1 %14.9 %15.7 %Single-family buyer traffic14,27217,67717,89414,56710,53364,41050,125Single-family average price of homes closed (in thousands)$    376$    374$    372$    381$    398$     376$     402Single-family home gross margin - excluding impairments (1)17.3 %19.5 %24.3 %20.2 %25.4 %20.7 %23.3 %(1)Single-family gross margin excluding impairments equals revenue less cost of sales and period costs (other than impairments and deposit write-offs).Weyerhaeuser CompanyUnallocated ItemsQ4.2012 Analyst PackagePreliminary results, subject to auditUnallocated items are gains or charges not related to or allocated to an individual operating segment. They include a portion of items such as: share-based compensation; pension and postretirement costs; foreign exchange transaction gains and losses associated with financing; and the elimination of intersegment profit in inventory and the LIFO reserve.Contribution to Earningsin millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Unallocated corporate function expenses$       (6)$       (3)$       (5)$       (8)$       (8)$      (22)$      (44)Unallocated share-based compensation(5)(1)(7)(3)(6)(16)(5)Unallocated pension & postretirement costs(7)(7)(7)(8)(5)(29)(26)Foreign exchange gains (losses)6(8)11(2)47(5)Elimination of intersegment profit in inventory and LIFO ?(12)(2)(10)8(6)(16)(25)Other3035(9)?(15)56(45)Operating income (loss)614(27)(13)(36)(20)(150)Interest income and other10910983833Net contribution to earnings from continuing operations1623(17)(4)(28)18(117)Net contribution to earnings from discontinued operations??????45Net contribution to earnings$      16$      23$    (17)$      (4)$    (28)$       18$     (72)?We now report the elimination of intersegment profit on inventory and the LIFO reserve in Unallocated Items. Previously these company-level adjustments were recorded in the business segments. This provides a better understanding of business operating results. Prior period results have been adjusted to reflect the change.Adjusted Earnings before Interest, Tax, Depreciation, Depletion and Amortization, Excluding Special Items*in millionsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Operating income (loss)$        6$      14$    (27)$    (13)$    (36)$     (20)$   (150)Depreciation, depletion and amortization574361928Non-operating pension and postretirement costs777852926Special items(38)(51)???(89)?Capitalized interest included in cost of products sold?511276Adjusted EBITDA, excluding special items*$    (20)$    (18)$    (15)$      (1)$    (23)$     (54)$     (90)* Non-GAAP measure - see below for definition.Unallocated Special Items Included in Net Contribution to Earnings (Pre-Tax)Q1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Gain on postretirement plan amendment$       52$       51$      ?$      ?$      ?$      103$        ?Restructuring, impairments and other charges(14)????(14)?Total special items from continuing operations3851???89?Gain on sale of property??????9Gain on sale of Westwood Shipping Lines??????49Total$      38$      51$      ?$      ?$      ?$       89$       58Unallocated Selected ItemsQ1.2012Q2.2012Q3.2012Q4.2012Q4.2011YTD.2012YTD.2011Total decrease (increase) in working capital (1)$     (72)$       68$       (7)$     (27)$     (25)$      (38)$      (97)Cash spent for capital expenditures$      ?$       (1)$       (1)$       (3)$      ?$        (5)$        (1)(1)Working capital does not include cash balances.*Adjusted EBITDA, excluding special items is a non-GAAP measure that management uses to evaluate the performance of the company. Adjusted EBITDA, as we define it, is operating income from continuing operations adjusted for depreciation, depletion, amortization, pension and postretirement costs not allocated to business segments (primarily interest cost, expected return on plan assets, amortization of actuarial loss and amortization of prior service cost/credit), special items and interest included in cost of products sold. Adjusted EBITDA should not be considered in isolation from and is not intended to represent an alternative to our GAAP results.For more information contact:Analysts ? Kathryn McAuley (253) 924-2058Media ? Anthony Chavez (253) 924-7148SOURCE Weyerhaeuser Company