Rayonier(RYN) - 2025 Q2 - Quarterly Results

Financial Highlights Overall Performance Rayonier's Q2 net income surged to $408.7 million, primarily from a New Zealand joint venture sale, with Adjusted EBITDA up 35% to $44.9 million Q2 2025 vs. Q2 2024 Financial Results (in millions, except EPS) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenues | $106.5 | $99.6 | | Net Income attributable to Rayonier | $408.7 | $1.9 | | Diluted EPS | $2.63 | $0.01 | | Pro Forma Net Income (Loss) | $9.6 | ($2.6) | | Pro Forma EPS | $0.06 | ($0.02) | | Adjusted EBITDA | $44.9 | $33.3 | - The substantial increase in net income was primarily due to a $404.4 million gain on the sale of the company's New Zealand joint venture interest[4] - Year-to-date cash available for distribution (CAD) increased by $8.3 million to $46.7 million, mainly due to lower net cash interest paid and reduced capital expenditures[6] Key Achievements & Capital Allocation The company completed its New Zealand asset disposition, repurchased $34.9 million in shares, and ended Q2 with $892.3 million cash - Completed the sale of the New Zealand joint venture interest, bringing total disposition activity to $1.45 billion since November 2023[5][7] - Repurchased approximately 1.5 million shares at an average price of $23.71 per share, totaling $34.9 million[16] - Ended the quarter with a cash balance of $892.3 million, providing significant capital allocation flexibility[5] Segment Performance Analysis Southern Timber Southern Timber's Adjusted EBITDA fell 16% to $28.4 million due to lower sales, harvest volumes, and stumpage realizations Southern Timber Q2 Performance (in millions) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Sales | $53.3 | $59.3 | | Operating Income | $12.6 | $17.1 | | Adjusted EBITDA | $28.4 | $33.9 | - Harvest volumes decreased 5% to 1.60 million tons due to softer mill demand and the impact of a large disposition in 2024[8] - Weighted-average net stumpage realizations fell 14% to $19.18 per ton, with pine sawtimber prices down 9% and pine pulpwood prices down 25%[8] Pacific Northwest Timber Pacific Northwest Timber's Adjusted EBITDA rose 17% to $7.0 million, driven by higher prices and lower costs despite reduced volumes Pacific Northwest Timber Q2 Performance (in millions) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Sales | $22.4 | $24.3 | | Operating Income (Loss) | $1.6 | ($1.5) | | Adjusted EBITDA | $7.0 | $5.9 | - Average delivered prices for domestic sawtimber increased 6% to $96.17 per ton due to strong domestic demand and favorable geographic mix[9] - Harvest volumes decreased 15% to 248,000 tons, primarily due to the impact of Large Dispositions completed in Q4 2024[9] Real Estate Real Estate's Adjusted EBITDA surged to $18.6 million, driven by higher sales of $29.4 million, increased acreage, and higher prices Real Estate Q2 Performance (in millions) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Sales | $29.4 | $15.5 | | Operating Income | $9.8 | $0.5 | | Adjusted EBITDA | $18.6 | $4.5 | - Improved Development sales included a 23-acre commercial parcel in the Heartwood project for $5.2 million ($225,000 per acre)[11] - Rural sales increased to $15.7 million (2,926 acres) from $7.5 million (1,439 acres) in the prior year period[12] Trading and Other Items Trading segment sales increased to $1.4 million with a slight operating loss, while corporate and net interest expenses decreased - Trading segment sales volumes increased to 18,000 tons from 5,000 tons in the prior year period, resulting in an operating loss of $0.1 million[13] - Corporate and other operating expenses decreased by $2.3 million year-over-year, mainly from lower compensation and benefits[14] - Interest expense decreased by $2.5 million due to lower average outstanding debt, while interest income rose by $0.6 million due to higher cash on hand[14][15] Financial Outlook Full-Year Outlook Rayonier reaffirmed full-year Adjusted EBITDA and pro forma EPS guidance, with Southern Timber near the low end and Real Estate at or above the high end - The company is on track to achieve full-year Adjusted EBITDA and pro forma EPS consistent with its prior guidance range[17] - Southern Timber: Full-year Adjusted EBITDA is expected near the lower end of the prior guidance range, with materially higher volumes and modestly higher stumpage prices anticipated in the second half of the year[18] - Real Estate: Full-year Adjusted EBITDA is now expected to be at or modestly above the high end of the prior guidance range[18] Third Quarter 2025 Guidance For Q3 2025, Rayonier projects net income between $29 million and $44 million, with Adjusted EBITDA of $80 million to $100 million Q3 2025 Guidance | Metric | Low End | High End | | :--- | :--- | :--- | | Net Income attributable to Rayonier | $29 million | $44 million | | EPS | $0.18 | $0.28 | | Adjusted EBITDA | $80 million | $100 million | - The Real Estate segment is expected to contribute $50 to $65 million in Adjusted EBITDA in Q3, though some closings could shift to Q4[18] Financial Statements Condensed Statements of Consolidated Income For H1 2025, sales decreased to $189.5 million, but net income surged to $405.3 million due to a $404.4 million gain from discontinued operations Six Months Ended June 30 (in millions) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Sales | $189.5 | $213.3 | | Operating Income | $14.6 | $13.2 | | Income from Discontinued Operations | $406.3 | $13.7 | | Net Income Attributable to Rayonier | $405.3 | $3.3 | Condensed Consolidated Balance Sheets As of June 30, 2025, the balance sheet shows stronger liquidity with cash at $892.3 million, long-term debt reduced to $844.9 million, and equity at $2.30 billion Balance Sheet Highlights (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $892.3 | $303.1 | | Total Assets | $3,514.3 | $3,474.4 | | Long-term debt | $844.9 | $1,044.4 | | Total Rayonier Inc. shareholders' equity | $2,302.2 | $1,769.3 | Condensed Consolidated Statements of Cash Flows For H1 2025, operating activities provided $88.7 million cash, investing activities provided $658.3 million (mainly from asset sales), resulting in a $549.7 million net cash increase Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $88.7 | $107.6 | | Net Cash from Investing Activities | $658.3 | ($47.4) | | Net Cash from Financing Activities | ($198.6) | ($125.1) | | Change in Cash | $549.7 | ($65.8) | Non-GAAP Financial Measures Reconciliation Reconciliation of Key Performance Indicators This section reconciles non-GAAP measures, showing H1 2025 Net Income of $410.5 million adjusted to Adjusted EBITDA of $71.9 million and Pro Forma Net Income of $6.9 million Reconciliation of Net Income to Adjusted EBITDA - Six Months Ended June 30, 2025 (in millions) | Line Item | Amount | | :--- | :--- | | Net Income | $410.5 | | Gain on sale of discontinued operations | ($404.4) | | Depreciation, depletion and amortization | $46.9 | | Other Adjustments | $18.9 | | Adjusted EBITDA | $71.9 | - Cash Available for Distribution (CAD) for the six months ended June 30, 2025 was $46.7 million, up from $38.4 million in the prior year period[47] Reconciliation of Adjusted EBITDA Guidance The company provides a Q3 2025 Adjusted EBITDA guidance reconciliation, starting with forecasted net income of $29.0-$45.0 million to reach $80.0-$100.0 million Q3 2025 Guidance Reconciliation (in millions) | Metric | Low | High | | :--- | :--- | :--- | | Net income | $29.0 | $45.0 | | Adjustments (Interest, D&A, etc.) | $51.0 | $55.0 | | Adjusted EBITDA | $80.0 | $100.0 |