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Weyerhaeuser buys high-quality Timberlands in Alabama

Posted on by darion

Additional investments will further strengthen Southern Timberlands’ portfolio and increase its presence in attractive markets

SEATTLE, July 25, 2024 /PRNewswire/ — Weyerhaeuser Company (NYSE: WY) today announced the acquisition of 84,300 acres of high-quality timberlands in Alabama for $244 million. Secured through multiple transactions, the total acreage consists of mature, highly productive timberlands that are well integrated with Weyerhaeuser’s existing operations. Additionally, the acquisitions are expected to deliver portfolio-leading cash flow and tons of harvested per acre to the company’s Southern Timberlands business.

Key Features of Acquisitions:

  • Located in one of the strongest lumber and fiber markets in the southern United States
  • Financial ownership with 74% of pine-planted areas and high land productivity
  • Mature pines are expected to produce an average of 6.4 tons per acre (or 540,000 tons) of crop per year for the first 10 years
  • Expected average adjusted EBITDA of approximately $150 per acre (or $12.5 million) per year from timber operations over the first 10 years

“These transactions represent compelling opportunities to expand our portfolio of high-quality, well-managed timberlands that generate solid returns for our shareholders,” said Devin W. Stockfish, chairman and chief executive officer. “They further demonstrate our disciplined approach to timberland growth and reinforce our long-term outlook that the asset class will appreciate over time. Including these transactions, by the end of 2025, we will have closed approximately $775 million toward our goal of growing our timberland portfolio through $1 billion of disciplined investment.”

Of the multiple deals involved, one closed in the second quarter of 2024 for $48 million. The remaining deals are under contract and are expected to close by the end of the year, subject to customary closing conditions. Once all acquisitions are complete, Weyerhaeuser will own or operate approximately 695,000 acres of timberlands in Alabama, along with two mills, a Timberlands office and a seed orchard – employing more than 350 people in the state.

ABOUT WEYERHAEUSER
Weyerhaeuser Company, one of the world’s largest privately owned timberlands owners, began operations in 1900 and currently owns or controls approximately 10.5 million acres of timberlands in the United States, as well as 14 million acres of timberlands managed under long-term licenses in Canada. Weyerhaeuser has been a global leader in sustainability for more than a century, managing 100 percent of its timberlands sustainably, consistent with internationally recognized sustainable forestry standards. Weyerhaeuser is also one of the largest manufacturers of wood products in North America and has additional business lines around real estate, climate solutions, energy and natural resources, among others. In 2023, the company generated $7.7 billion in net sales and employed approximately 9,300 people serving customers worldwide. Operating as a real estate investment trust, Weyerhaeuser common stock is traded on the New York Stock Exchange under the symbol WY. Learn more at www.weyerhaeuser.com.

NON-GAAP FINANCIAL MEASURES
This press release refers to projected estimates of Adjusted EBITDA, a non-GAAP measure that management uses to evaluate the Company’s performance. Adjusted EBITDA, as we define it, is operating income adjusted for depreciation, amortization, accumulated depreciation, basis in real estate sold and special items. Adjusted EBITDA should not be considered in isolation from, and is not intended to be an alternative to, our GAAP results. We have not provided a reconciliation of this projected non-GAAP financial measure to the most comparable GAAP measure of net income because Adjusted EBITDA, as we define it, excludes the impact of certain items listed above in our definition of Adjusted EBITDA and management cannot estimate these items or the impact they will have on Adjusted EBITDA on a forward-looking basis without unreasonable effort. As a result, investors may not be able to accurately compare the expected impact of acquisitions to our historical results or the results or expected results of other companies that may have treated such matters differently. However, management believes that providing this forward-looking non-GAAP information about acquisitions is useful to investors, and given the uncertain nature of forward-looking statements, we believe that investors are able to consider the inherent limitations of this forward-looking non-GAAP information. We cannot predict the occurrence, timing or amount of any of the items that we exclude from our estimate of Adjusted EBITDA. Accordingly, the actual impact of these items, once determined, could potentially be material to the calculation of Adjusted EBITDA and actual results could differ materially from our estimate.

FORECASTING STATEMENTS
This press release contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, with respect to the Company’s expectations regarding the occurrence, timing and expected financial contributions and economic results of its acquisitions of certain timberlands in Alabama, including expected synergies, Adjusted EBITDA, Adjusted EBITDA per acre and average annual tons of harvested. Forward-looking statements can be identified by our use of certain words in such statements, including, without limitation, words such as “expected” and “will” and similar words, terms and phrases using such terms and words. We also refer to expected results by or events that will occur by or at a future date, and such references also constitute forward-looking statements. All forward-looking statements speak only as of the date hereof, are based on current expectations and involve and are subject to a number of assumptions, risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These risks and uncertainties include, but are not limited to, those identified in our 2023 Annual Report on Form 10-K, as well as those set forth from time to time in our other public statements, reports, registration statements, prospectuses, information statements and other filings with the Securities and Exchange Commission. In addition, Weyerhaeuser may not be able to complete the remaining portions of the transaction within the time period indicated, or at all, due to a number of factors, including, without limitation, the occurrence of any event, change or other circumstances that could cause the transaction to be completed in accordance with the terms of the purchase and sale agreement governing the transaction or the failure to satisfy other closing conditions. There is no assurance that any of the events contemplated by these forward-looking statements will occur. If any of the events occur, there is no assurance as to the effect they will have on the company’s business, results of operations, cash flows, financial condition and future prospects. The company undertakes no obligation to update these forward-looking statements after the date of this press release.

For more information contact:

Weyerhaeuser
Analysts -Andy Taylor, 206-539-3907
Media – Nancy Thompson, 919-861-0342

SOURCE Weyerhaeuser Company