Weyerhaeuser Company (NYSE:WY) 2025 Investor Day December 11, 2025 09:00 AM ET Company ParticipantsNone - Video NarratorHong Shen - Production SupportTravis Keatley - Senior Vice President of TimberlandsCharles Perron-Piché - VP of Equity ResearchPaul Hossain - Senior VP and Chief Development OfficerKetan Mamtora - Director of Equity ProductsDenise Merle - Senior VP and Chief Administration OfficerBrian Chaney - Senior Vice President of Wood ProductsDevin Stockfish - CEOJohn Petrides - Portfolio ManagerDavi ...

Financial Performance - Q3 2025 - Sales reached $1775 million in Q3 2025, compared to $1241 million in Q3 2024[10] - Operating income was $417 million in Q3 2025, significantly higher than $188 million in Q3 2024[10] - Adjusted EBITDA increased to $1143 million in Q3 2025 from $572 million in Q3 2024[10] - Net income attributable to Rayonier Inc was $432 million in Q3 2025, compared to $288 million in Q3 2024[10] Year-to-Date (YTD) Performance - Q3 2025 - Cash provided by operating activities was $2049 million for the nine months ended September 30, 2025, compared to $1738 million for the same period in 2024[10] - Cash available for distribution (CAD) was $1535 million for the nine months ended September 30, 2025, compared to $771 million in 2024[10] - Adjusted EBITDA reached $1862 million YTD in 2025, up from $1352 million YTD in 2024[17] Segment Performance - Q3 2025 - Southern Timber segment's operating income was $225 million in Q3 2025, compared to $198 million in Q3 2024[12] - Pacific Northwest Timber segment's operating income was $18 million in Q3 2025, compared to $08 million in Q3 2024[12] - Real Estate segment's operating income was $264 million in Q3 2025, compared to $86 million in Q3 2024[12]

Core Insights - The financial sector has provided over $425 billion in financing to companies contributing to deforestation over the past decade, with $72 billion allocated in the last 18 months alone [1][2] - The increase in lending to forest-risk commodity companies has coincided with significant deforestation, with a record loss of 6.7 million hectares of tropical and boreal forests last year [3] - Major banks, particularly Banco do Brasil, are leading in financing these sectors, with nearly $8 billion provided in the first nine months of this year [4] - Asset managers have increased their investments in forest-risk commodities by $7.8 billion over the past decade, totaling approximately $33 billion by the end of September [5][6] - The report calls for regulatory changes to prevent banks and investors from profiting from deforestation and human rights violations [7][8]

Financial Data and Key Metrics Changes - Total adjusted EBITDA for Q3 2025 was $89 million, up from $52 million in Q2 2025, primarily driven by strong real estate activity [5][16] - Adjusted EBITDA for the timberland segment increased from $40 million in Q2 to $41 million in Q3 [16] - The wood products segment reported an EBITDA loss of $2 million in Q3, compared to a positive $2 million in Q2, due to lower lumber prices [8][18] Business Line Data and Key Metrics Changes - Timberlands harvested 1.9 million tons in Q3, with Idaho producing its highest quarterly volume of 411,000 tons [7][16] - The wood products segment shipped 333 million board feet in Q3, an increase of 30 million board feet from Q2 [8][18] - Real estate generated adjusted EBITDA of $63 million in Q3, up from $23 million in Q2, with significant sales in rural real estate [10][19] Market Data and Key Metrics Changes - Sawlog prices in Idaho declined by 5% per ton compared to Q2, while average southern sawlog prices increased by just over 1% [17] - The overall demand in the U.S. housing market remains constrained, but mortgage rates have fallen to 6.1%, improving affordability [13] - The repair and remodel market is experiencing muted activity due to economic uncertainty, but demand for home improvement is expected to remain stable [14] Company Strategy and Development Direction - The proposed merger with Rayonier is expected to create significant strategic and financial benefits, including increased scale and operational efficiencies [6][7] - The company is focused on expanding its natural climate solutions portfolio, including opportunities in solar and lithium development [11][12] - Capital allocation remains disciplined, with a focus on executing the strategic plan and maintaining a solid financial position [13][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term fundamentals driving demand in the industry, despite near-term headwinds [15] - Lumber prices are expected to stabilize, supported by a more balanced supply-demand dynamic [10][15] - The company anticipates a decline in total adjusted EBITDA in Q4 due to fewer rural real estate acres sold and seasonally lower harvest volumes [24] Other Important Information - The company repurchased $60 million of common stock in the first half of the year, but share repurchases will be limited prior to the merger closing [12] - The company maintains $388 million in liquidity, including $89 million in cash [21] Q&A Session Summary Question: Insights on pulpwood markets in the U.S. South - Management acknowledged recent mill closures affecting pulpwood prices but emphasized their scale and customer relationships allow them to maintain steady log takeaway [25][26] Question: Performance in wood products and cash margins - Management indicated that while there was a loss in wood products, operational execution was strong, and they expect prices to move slightly higher in Q4 [29][30] Question: Factors driving better-than-expected real estate performance - Management noted that larger conservation sales significantly contributed to the outperformance in real estate, with strong demand for rural properties [33] Question: Outlook for supply constraints and pricing - Management mentioned that curtailments in production are expected to support improved pricing in 2026, despite a slow period in Q4 [38][39] Question: Revenue from conservation sales - Management indicated that conservation sales contributed about 25% of total rural revenues, with prices up approximately 10% year-over-year [40][41]

Q3 2025 Financial Performance - Total Adjusted EBITDDA reached $89.3 million, driven by strong Real Estate segment performance[10] - Timberlands Adjusted EBITDDA was $41.0 million, reflecting seasonally higher harvest volumes[10, 19] - Wood Products Adjusted EBITDDA was negative $(2.5) million, impacted by lower lumber prices[10] - Real Estate Adjusted EBITDDA significantly increased to $63.1 million due to rural real estate sales and increased Chenal Valley sales[10, 51] Timberlands Segment - Northern Timberlands Adjusted EBITDDA was $21.2 million with sawlog harvest volume at 403 thousand tons and an average price of $128 per ton[30] - Southern Timberlands Adjusted EBITDDA was $19.8 million with sawlog harvest volume at 614 thousand tons and an average price of $47 per ton[36] Wood Products Segment - Lumber shipment volume increased to 333 MMBF, but the average lumber price decreased by 12% to $396 per MBF[10, 44, 46] Real Estate Segment - Rural land sales involved 15,636 acres at an average price of $3,280 per acre[10, 53, 55] - Development segment sold 55 residential lots at an average price of $138,938 per lot and 13 commercial acres at $532,942 per acre[10, 53, 57] Capital Allocation and Liquidity - Cash Available for Distribution (CAD) was $118.5 million for the trailing twelve months[10] - The company maintains a strong liquidity position with $388 million available and a net debt to enterprise value of 23.1%[11]

Financial Data and Key Metrics Changes - Weyerhaeuser reported third-quarter GAAP earnings of $80 million, or $0.11 per diluted share, on net sales of $1.7 billion, with adjusted EBITDA totaling $217 million for the quarter [3][4] - Excluding special items, earnings were $40 million, or $0.06 per diluted share, reflecting solid execution against a challenging market backdrop [3][4] - Cash generated from operations was $210 million, with total debt just under $5.5 billion and approximately $400 million in cash at quarter-end [18][19] Business Line Data and Key Metrics Changes - **Timberlands**: Contributed $80 million to second-quarter earnings, with adjusted EBITDA of $148 million, a $4 million decrease from the second quarter [8] - **Real Estate, Energy, and Natural Resources (ENR)**: Contributed $69 million to third-quarter earnings and $91 million to adjusted EBITDA, with a $52 million decrease from the prior quarter [11][12] - **Wood Products**: Excluding special items, reported a $48 million loss in the third quarter, with adjusted EBITDA down $93 million compared to the second quarter [14][17] Market Data and Key Metrics Changes - Log pricing in the domestic market faced downward pressure due to ample supply and elevated log inventories, leading to decreased average domestic sales realizations [9][10] - The Japanese log market softened, resulting in increased finished goods inventories and decreased log prices, although sales volumes were moderately higher [9][10] - Southern saw log markets moderated slightly, while fiber markets remained stable, with a slight increase in fee harvest volumes [10][11] Company Strategy and Development Direction - The company is focused on optimizing its Timberlands portfolio through strategic acquisitions and divestitures, completing two acquisitions totaling $459 million and advancing three divestiture packages expected to generate $410 million in cash proceeds [4][5][6] - Weyerhaeuser aims to enhance the return profile of its timberlands while balancing capital allocation to drive long-term shareholder value [6][19] - The company remains constructive on long-term demand fundamentals supporting growth in housing and climate solutions [4][32] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging market backdrop but expressed confidence in the company's ability to navigate current conditions due to a strong balance sheet and operational excellence [3][4] - The outlook for the fourth quarter anticipates lower earnings and adjusted EBITDA in Timberlands, driven by lower sales volumes and realizations [21][24] - Management expects a gradual improvement in housing demand as macroeconomic conditions stabilize, with a favorable long-term outlook supported by demographic trends [30][31] Other Important Information - The company completed the sale of its Princeton Mill for $85 million, with expectations of receiving the remainder of the transaction proceeds in the coming months [6][7] - Weyerhaeuser's natural climate solutions business is on track to reach $100 million of adjusted EBITDA by year-end, with solid demand for carbon credits [13][24] Q&A Session Summary Question: Thoughts on lumber and OSB capacity - Management acknowledged the challenging year for lumber and OSB, emphasizing the need for housing in the U.S. and the importance of balancing short-term and long-term strategies [35][36][38] Question: Timberlands portfolio positioning - Management expressed satisfaction with recent Timberlands transactions and reiterated a commitment to active portfolio management [39][40] Question: Cash generation from Timberlands transactions - Management highlighted a significant increase in annual EBITDA from past acquisitions and divestitures, emphasizing the value creation potential of their integrated portfolio [41][42] Question: Strategies to lower costs in wood products - Management noted ongoing efforts to focus on costs and operational excellence, with a roadmap for achieving a first quartile cost structure across mills [44][46] Question: Leverage and capital allocation priorities - Management reaffirmed a commitment to maintaining an investment-grade credit rating and highlighted the flexibility in capital allocation to navigate challenging markets [48][49] Question: Competitive dynamics in the timber space - Management acknowledged the benefits of scale and integration in the timber industry, emphasizing Weyerhaeuser's strong position with 10.4 million acres of land [51][52] Question: Rising prices in HBU properties - Management indicated that rising prices for HBU properties are due to a combination of mix and geography dynamics, with continued strong interest in Timberlands [56][57]

Financial and Operational Highlights - Acadian Timber's third quarter of 2025 showed a mix of stable market demand and operational challenges [5] - Overall product demand remained stable despite ongoing economic uncertainty, with performance varying across operating regions [5] - In New Brunswick, strong timber sales volumes were supported by consistent contractor availability [5] - Main operations faced challenges due to limited contractor capacity and reduced productivity, impacting deliveries to customers [5]

Transaction Overview - Rayonier and PotlatchDeltic will merge in an all-stock transaction, with PotlatchDeltic shareholders receiving 1.7339x Rayonier shares for each PotlatchDeltic share[1,9] - The transaction represents an 825% premium to PotlatchDeltic, based on closing stock prices as of October 10, 2025[9] - Pro forma ownership will be 54% for Rayonier shareholders and 46% for PotlatchDeltic shareholders[9] - The combined company is expected to close in late first quarter or early second quarter of 2026[9] Synergies and Financial Impact - The merger is expected to generate $40 million in annual run-rate synergies, primarily from corporate and operating overhead cost savings[8,9] - The combined company will have a pro forma market capitalization of approximately $71 billion[8] - The pro forma net leverage ratio is estimated to be approximately 25x[8] Combined Company Assets - The combined company will own approximately 42 million acres of timberlands[8,15] - The combined company's timberlands include 3227K acres in the U S South and 931K acres in the U S Northwest[18] - PotlatchDeltic's wood products facilities have the capacity to produce 12BBF of lumber annually and 150MMSF of plywood annually[21] Real Estate - Rayonier and PotlatchDeltic have demonstrated improving HBU premium realizations as well as a shift toward higher-value development sales over the past decade[37,38] - Rayonier and PotlatchDeltic have 79K acres under option for solar projects[48] - Rayonier has 154K acres under CCS lease in TX, LA, and AL[48]

Group 1 - The deal will result in a combined company with an enterprise value exceeding $8 billion [1]

Core Insights - Acadian Timber Corp. will release its third quarter results for 2025 after market close on October 29, 2025, followed by a conference call on October 30, 2025, at 1:00 PM Eastern Time [2][3] Company Overview - Acadian Timber Corp. is one of the largest timberland owners in Eastern Canada and the Northeastern U.S., managing approximately 2.4 million acres of land [5] - The company owns about 775,000 acres of freehold timberlands in New Brunswick and 300,000 acres in Maine, in addition to providing timber services for approximately 1.3 million acres of Crown licensed timberlands in New Brunswick [5] - Acadian's primary business includes forest management and the production of timber products such as softwood and hardwood sawlogs, pulpwood, and biomass by-products, serving around 90 regional customers [5] Business Strategy - The company's strategy focuses on maximizing cash flows from existing timberland assets through sustainable forest management and other land use activities [6] - Acadian aims to grow its business by acquiring assets and actively managing these assets to enhance performance [6]