Q1 2013 Earnings Call Transcript

Transcript Call Date 04/29/2013

Operator: Good day, ladies and gentlemen and welcome to the Plum Creek Q1 2013 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. As a reminder, this conference call maybe recorded.

I would now like to introduce your host for today's conference John Hobbs, Vice President of Investor Relations. Sir, you may begin.

John B. Hobbs - VP, IR: Thank you, Samia. Good afternoon, ladies and gentlemen, and welcome to the first quarter 2013 conference call for Plum Creek. I'm John Hobbs, Vice President of Investor Relations. Today we have on the line Rick Holley, CEO and David Lambert, Senior Vice President and CFO.

This call is open to all investors and members of the media. However, the Q&A portion of the call is intended for the professional investment community only. We ask that other participants please follow-up with any questions by calling me at 1-800-858-5347. I encourage you to visit our website, There you will find our press release and supplemental financial statements for the first quarter of 2013.

Before we begin, I'd like to take this time to remind everyone that certain of our statements today will be forward-looking, involving known and unknown risks, uncertainties, and other factors that may cause actual results or performance to differ from those expressed or implied. These risks and factors are routinely detailed in our filings with the Securities and Exchange Commission. Following today's prepared remarks, we'll open up the call for your questions. Rick?

Rick R. Holley - President and CEO: Good afternoon. We started our 2013 with a strong first quarter. Each of our business segments reported improved operating profit compared to the same period last year. Northern sawlog prices were up sharply over the past six months, helping drive improved results in our Northern Resources business segment. Southern sawlog markets are showing encouraging early signs of improvement as well. Our manufacturing business continues to perform very well serving less volatile specialty and industrial markets. It is expected to post one of its best years ever in terms of both earnings and cash generation. Overall, we are on track to grow adjusted EBITDA of our non-real estate business segments by $50 million this year.

Now, I'll turn it over to David to cover our first quarter details as well as our guidance for second quarter of 2013. David?

David W. Lambert - SVP and CFO: Thanks, Rick. Our first quarter results of $0.35 exceeded our initial expectations, despite real estate sales coming in $2 million below the low end of our expectations. Robust West Coast log markets and growing demand and prices for our lumber and panel products were the hallmarks of the quarter.

Northern Resources $11 million operating profit was excellent more than doubling the fourth quarters' $5 million profit; much stronger sawlog prices drove the sequential improvement in profitability.

Northern sawlog prices improved sharply throughout the first quarter, averaging $77 per ton, up $9 per ton or 13% from the fourth quarter. Sawlog demand was strong as domestic sawmills in the Pacific Northwest have ramped up lumber production significantly over the past year. The latest statistics available show West Coast lumber production up nearly 12% year-over-year through the end of February.

Read our Earnings Call Transcript disclaimer.
Add a Comment
E-mail me new replies.