PotlatchDeltic(PCH) - 2025 Q2 - Quarterly Results

Q2 2025 Financial & Operational Overview Financial Highlights PotlatchDeltic reported Q2 2025 net income of $7.4 million on revenues of $275.0 million, reflecting strong Timberlands and Real Estate performance despite Wood Products weakness, supported by share repurchases and robust liquidity Q2 2025 Key Financial Metrics | Metric (in millions, except per share data) | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Revenues | $275.0 | $268.3 | $320.7 | | Net income | $7.4 | $25.8 | $13.7 | | Net income per diluted share | $0.09 | $0.33 | $0.17 | | Total Adjusted EBITDDA | $52.0 | $63.4 | $103.2 | | Total Adjusted EBITDDA Margin | 18.9% | 23.6% | 32.2% | | Net cash from operations | $41.0 | $49.1 | $100.6 | - CEO Eric Cremers noted that overall financial results were solid despite economic uncertainty, with strong performance from the Timberlands and Real Estate businesses offsetting soft demand in the Wood Products segment[2] - The company executed its capital allocation strategy by repurchasing 1,418,800 shares for $55.9 million, at an average price of $39 per share, and paid its regular quarterly dividend of $0.45 per share[2][3][4] - The company maintained strong liquidity of $395 million as of June 30, 2025[3] Business Segment Performance (Q2 2025 vs. Q1 2025) Timberlands The Timberlands segment saw a slight decrease in performance, with Adjusted EBITDDA falling by $2.8 million compared to Q1 2025, primarily due to lower harvest volumes and higher forest management costs, partially offset by increased Northern sawlog prices Timberlands Performance (Q2 2025 vs Q1 2025) | Metric (in millions) | Q2 2025 | Q1 2025 | Change (in millions) | | :--- | :--- | :--- | :--- | | Timberlands Revenues | $101.7 | $102.5 | $(0.8) | | Timberlands Adjusted EBITDDA | $39.6 | $42.4 | $(2.8) | - Northern sawlog prices increased, driven by higher cedar prices[7] - Southern harvest volumes decreased due to lower stumpage sales[7] - Forest management costs rose due to seasonally higher activity[7] Wood Products The Wood Products segment experienced a significant decline, with Adjusted EBITDDA decreasing by $10.0 million from the previous quarter, driven by lower lumber prices, increased log costs, higher inventory charges, and unfavorable manufacturing impacts Wood Products Performance (Q2 2025 vs Q1 2025) | Metric (in millions) | Q2 2025 | Q1 2025 | Change (in millions) | | :--- | :--- | :--- | :--- | | Wood Products Revenues | $171.8 | $164.6 | $7.2 | | Wood Products Adjusted EBITDDA | $1.7 | $11.7 | $(10.0) | - Average lumber price decreased 1% to $450 per thousand board feet (MBF)[8] - Log costs increased, particularly due to higher indexed pricing in Idaho[8] - A $3.0 million higher lumber inventory charge compared to Q1[8] - Manufacturing costs were unfavorably impacted by $2.8 million due to an equipment upgrade and a power supply issue[8] Real Estate The Real Estate segment delivered stable results, with Adjusted EBITDDA remaining flat compared to Q1 2025, supported by significant rural land and residential lot sales Real Estate Performance (Q2 2025 vs Q1 2025) | Metric (in millions) | Q2 2025 | Q1 2025 | Change (in millions) | | :--- | :--- | :--- | :--- | | Real Estate Revenues | $29.1 | $27.6 | $1.5 | | Real Estate Adjusted EBITDDA | $22.7 | $22.7 | $— | - 7,457 acres of rural land sold at an average price of $3,108 per acre[18] - 18 residential lots sold at an average price of $102,222 per lot[18] Consolidated Financial Statements Condensed Consolidated Statements of Operations This section presents the company's unaudited income statement for the three and six months ended June 30, 2025, compared to the same periods in 2024 and the prior quarter, detailing revenues, costs, operating income, and net income Income Statement Highlights (Three Months Ended June 30) | Metric (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Revenues | $274,985 | $320,671 | | Operating income | $13,846 | $17,446 | | Net income | $7,354 | $13,678 | | Diluted EPS | $0.09 | $0.17 | Condensed Consolidated Balance Sheets This section provides the company's unaudited balance sheet as of June 30, 2025, compared to December 31, 2024, outlining the company's assets, liabilities, and stockholders' equity Balance Sheet Highlights | Metric (in thousands) | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $95,277 | $151,551 | | Total current assets | $258,854 | $299,130 | | Total assets | $3,184,703 | $3,305,443 | | Total liabilities | $1,262,776 | $1,267,773 | | Total stockholders' equity | $1,921,927 | $2,037,670 | Condensed Consolidated Statements of Cash Flows This section details the company's cash inflows and outflows from operating, investing, and financing activities for the three and six months ended June 30, 2025, showing a net decrease in cash for the quarter Cash Flow Summary (Three Months Ended June 30, 2025) | Activity (in thousands) | Amount | | :--- | :--- | | Net cash from operating activities | $40,999 | | Net cash from investing activities | $(554) | | Net cash from financing activities | $(91,969) | | Change in cash and cash equivalents | $(51,524) | Segment Information This section provides a detailed breakdown of revenues and Adjusted EBITDDA by business segment (Timberlands, Wood Products, Real Estate) for the three and six-month periods ended June 30, 2025 and 2024 Segment Revenues (Three Months Ended June 30) | Segment (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Timberlands | $101,664 | $98,802 | | Wood Products | $171,819 | $153,579 | | Real Estate | $29,096 | $95,732 | Segment Adjusted EBITDDA (Three Months Ended June 30) | Segment (in thousands) | 2025 | 2024 | | :--- | :--- | :--- | | Timberlands | $39,566 | $34,124 | | Wood Products | $1,723 | $(6,805) | | Real Estate | $22,720 | $89,568 | | Total Adjusted EBITDDA | $52,025 | $103,173 | Supplementary Information Non-GAAP Measures & Reconciliations This section defines and explains the rationale for using non-GAAP financial measures such as Total Adjusted EBITDDA and Adjusted Net Income, providing reconciliations to comparable GAAP measures to reflect core business operations - Management uses non-GAAP measures like Total Adjusted EBITDDA and Adjusted Net Income to evaluate operational performance and enhance comparability period-over-period[10][11][12] Reconciliation of Net Income to Total Adjusted EBITDDA (Q2 2025) | Item (in thousands) | Amount | | :--- | :--- | | Net income (GAAP) | $7,354 | | Interest expense, net | $10,412 | | Income taxes | $(3,530) | | Depreciation, depletion and amortization | $26,370 | | Basis of real estate sold | $11,481 | | Other adjustments | $(119) | | Total Adjusted EBITDDA | $52,025 | Other Information This section contains details about the upcoming investor conference call, an overview of the company's REIT operations, and important forward-looking statements outlining potential risks and uncertainties - The company is a leading Real Estate Investment Trust (REIT) owning 2.1 million acres of timberlands across seven states and operates six sawmills and an industrial-grade plywood mill[16] - A conference call to discuss Q2 2025 results is scheduled for July 29, 2025, at 9:00 a.m. Pacific Time[14] - Forward-looking statements are subject to numerous risks, including changes in the U.S. housing market, timber prices, interest rates, trade policies, and production capacity in the forest products industry[19]