Date: Thu, 20 Nov 1997 21:26:54 GMT Server: Apache/1.1.1 Content-type: text/html Set-Cookie: Apache=heart25632880061214859; path=/ Content-length: 14033 Last-modified: Wed, 05 Feb 1997 21:43:19 GMT
For the nine month period, Partnership income was $77.7 million, down $1.2 million from 1995, primarily due to higher interest expense. Income per Class A Unit of $4.21, was 5 cents per Class A Unit higher than 1995 results. Operating cash flow allocable to each Class A Unit was $4.40, up 5 cents per Class A Unit. Sales for the first nine months of 1996 were $112.8 million, $1.3 million above last year.
In the Northwest region, stumpage and delivered log volume for the third quarter was 32 percent higher than the prior year as customers expanded harvesting in recognition of stronger export and domestic log markets. The volume increase was offset by a 25 percent decline in prices from prior year levels, reflective of weak export and domestic log markets at the time the contracts were initiated. As a result, third quarter sales decreased $0.2 million to $14.5 million and operating income declined $0.9 million to $8.5 million. Approximately 80 percent of the anticipated annual harvest had been cut in the first nine months.
In the Southeast region, third quarter sales increased $1.2 million to $12.5 million and operating income rose $1.5 million to $10.7 million from the prior year, reflecting higher volume partially offset by lower prices. Pine prices declined 12 percent from the prior year due to contracts previously entered into during weak pulp and paper markets. Approximately 72 percent of the anticipated annual harvest had been cut in the first nine months.
Rayonier Forest Resources continues to caution unitholders that the market value of Class A Units is expected to decline substantially as the end of the Initial Term approaches December 31, 2000. Class A unitholders are generally entitled to 95 percent of Partnership earnings and cash flows during the 15-year Initial Term, which began in 1985. After the year 2000, Class A unitholders will only have a 4 percent interest in Partnership revenues, expenses and cash flow. On a pro forma basis, using 1995 results as an example, cash allocable per Class A Unit would decline from $6.17 for the full year to approximately 22 cents. In addition, on December 31, 2000, the Secondary Account is expected to have debt (incurred to fund long-term investment in such areas as reforestation and silvicultural activities including accrued interest) of over $350 million, more than three times 1995's net operating cash flow. In accordance with the Partnership Agreement, all Secondary Account debt must be repaid before any distribution of Partnership cash flow resumes.
Rayonier Timberlands, L.P. grows and sells timber in the U.S. on 782,000 acres in the Southeast and on 369,000 acres in the Northwest. Rayonier Inc., the Special General Partner, owns 74.7 percent of the 20 million outstanding Class A Units of Rayonier Timberlands, L.P. The balance is publicly traded on the NYSE.
Editor's Note: Earnings for Rayonier Inc. (NYSE:RYN), the parent company of Rayonier Timberlands, were released yesterday.
(thousands of dollars, except per unit information)
Third Quarter Ended September 30, |
Nine Months Ended September 30, |
|||
1996 |
1995 |
1996 |
1995 |
|
Sales | $27,010 |
$26,029 |
$112,773 |
$111,449 |
Partnership income | $15,811 |
$15,645 |
$77,742 |
$78,987 |
Income per publicly traded Class A Unit | $0.94 |
$0.88 |
$4.21 |
$4.16 |
Operating cash flow allocable to a publicly traded Class A Unit |
$1.01 |
$0.93 |
$4.40 |
$4.35 |
(thousands of dollars, except volumes and per unit information)
Third Quarter Ended September 30, |
Nine Months Ended September 30, |
|||
1996 |
1995 |
1996 |
1995 |
|
Timber and timberland sales | ||||
Northwest | $14,487 | $14,670 | $72,471 | $64,069 |
Southeast | 12,523 |
11,359 |
40,302 |
47,380 |
Total | $27,010 |
$26,029 |
$112,773 |
$111,449 |
Operating income | ||||
Northwest | $8,507 | $9,382 | $55,285 | $49,185 |
Southeast | 10,655 | 9,154 | 32,544 | 38,173 |
Corporate and other | (491) |
(458) |
(1,471) |
(1,382) |
Total | $18,671 |
$18,078 |
$86,358 |
$85,976 |
Partnership income | $15,811 |
$15,645 |
$77,742 |
$78,987 |
Income per publicly | ||||
traded Class A Unit | $0.94 |
$0.88 |
$4.21 |
$4.16 |
Operating cash flow allocable to a | ||||
publicly traded Class A Unit | $1.01 |
$0.93 |
$4.40 |
$4.35 |
Northwest harvest volumes | ||||
Stumpage, in millions of board feet | 13.8 | 10.6 | 96.6 | 79.0 |
Delivered logs, in millions of board feet |
21.1 |
15.8 |
51.0 |
35.9 |
Total | 34.9 |
26.4 |
147.6 |
114.9 |
Southeast harvest volumes | ||||
Pine, in thousands of short green tons | 431.9 | 303.4 | 1,325.2 | 1,304.5 |
Hardwoods, in thousands of short green tons |
64.1 |
72.5 |
166.4 |
163.8 |
Total | 496.0 |
375.9 |
1,491.6 |
1,468.3 |