PotlatchDeltic Corporation Reports Fourth Quarter and Full Year 2022 Results

PotlatchDeltic Corporation today reported net income of $3.8 million, or $0.05 per diluted share, on revenues of $253.1 million for the quarter ended December 31, 2022. Excluding after tax special items consisting of CatchMark merger related expenses and an environmental charge, adjusted net income was $9.3 million, or $0.12 per diluted share for the fourth quarter of 2022. Net income was $39.2 million, or $0.58 per diluted share, on revenues of $248.4 million for the quarter ended December 31, 2021. Excluding a net loss on fire damage, adjusted net income was $39.9 million, or $0.59 per diluted share for the fourth quarter of 2021.

Net income for the full year 2022 was $333.9 million, or $4.58 per diluted share, on revenues of $1.3 billion. Excluding after tax special items consisting of a pension settlement charge, a gain on insurance recoveries, CatchMark merger related expenses and an environmental charge, adjusted net income was $350.0 million, or $4.80 per diluted share for 2022. Net income for the full year 2021 was $423.9 million, or $6.26 per diluted share, on revenues of $1.3 billion. Excluding a net gain on insurance recoveries, adjusted net income was $421.4 million, or $6.22 per diluted share for 2021.

2022 Highlights

• Generated Total Adjusted EBITDDA of $574.1 million and Total Adjusted EBITDDA margin of 43%
• Acquired CatchMark Timber Trust, Inc. adding nearly 350,000 acres of superior site index southern timberlands
• Also acquired 46,000 acres of well stocked timberlands in three bolt-on transactions
• Announced $131 million expansion and modernization of Waldo, Arkansas sawmill
• Rebuilt and restarted the large log line at the Ola, Arkansas sawmill
• Returned $208 million to shareholders through regular dividends and a Q4 special dividend
• Repurchased 1.2 million shares for $55 million, or $45 per share
• Maintained strong liquidity position of $643 million as of December 31, 2022

“Each of our businesses delivered exceptional results in 2022 leading to our second highest Total Adjusted EBITDDA on record and marking our third straight year of very strong financial performance,” said Eric Cremers, president and chief executive officer. “2022 was also a very active year for successfully deploying capital, including acquiring nearly 400,000 acres of high-quality timberland and committing to expand and modernize our Waldo, Arkansas sawmill. Additionally, we returned $263 million to shareholders in 2022, including $55 million of share repurchases and a $76 million special dividend. With our disciplined capital allocation strategy and our strong balance sheet and liquidity we are well positioned to continue increasing shareholder value,” stated Mr. Cremers.

Business Performance: Q4 2022 vs. Q3 2022

Timberlands

Fourth Quarter 2022 Highlights

• Timberlands Adjusted EBITDDA decreased $13.9 million from Q3 2022
• Northern sawlog prices decreased 18% due primarily to lower indexed sawlog prices
• A seasonal decline in Southern harvest volumes was moderated by the first full quarter of CatchMark operations
• Southern sawlog prices increased 3%, reflecting the addition of strong CatchMark markets
• Higher log & haul costs were primarily due to inflationary pressures, including increased diesel costs

Wood Products

Fourth Quarter 2022 Highlights

• Wood Products Adjusted EBITDDA decreased $28.9 million from Q3 2022
• Average lumber price decreased 17% to $473 per MBF in Q4 2022
• Lumber production declined in Q4 2022 leading to lower fixed cost absorption
• Log costs decreased primarily due to lower index pricing in Idaho
• Plywood shipments and price realizations declined on lower demand

Real Estate

Fourth Quarter 2022 Highlights

• Real Estate Adjusted EBITDDA decreased $6.9 million from Q3 2022
• Sold 1,329 acres of rural land at an average price of $2,837 per acre
• Sold 24 residential lots at an average price of $132,000 per lot
• Sold 5 commercial acres at an average of $437,407 per acre

Outlook

“While higher interest rates and their expected impact on housing starts are expected to create headwinds for our operating results in 2023, we continue to remain very bullish on long-term housing-related fundamentals that drive demand in our business. We are encouraged by the recent increase in lumber prices and improvement in housing affordability. During 2023, we expect to harvest 7.7 million tons in our Timberlands segment, ship around 1.1 billion board feet in lumber in our Wood Products segment and sell about 18,000 rural acres and 150 residential lots in our Real Estate segment,” stated Mr. Cremers.

For the complete press release, click here.

About PotlatchDeltic

PotlatchDeltic (Nasdaq: PCH) is a leading Real Estate Investment Trust (REIT) that owns nearly 2.2 million acres of timberlands in Alabama, Arkansas, Georgia, Idaho, Louisiana, Mississippi and South Carolina. Through its taxable REIT subsidiary, the company also operates six sawmills, an industrial-grade plywood mill, a residential and commercial real estate development business and a rural timberland sales program. PotlatchDeltic, a leader in sustainable forest management, is committed to environmental and social responsibility and to responsible governance. More information can be found at www.potlatchdeltic.com.

Contact:

Jerry Richards – Vice President and Chief Financial Officer – Investor@PotlatchDeltic.com – (509) 835-1521

Source: PotlatchDeltic Corporation