x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to |
Large accelerated filer x | Accelerated filer o | |
Non-accelerated filer o | Smaller reporting company o |
Item | Page | ||
PART I - FINANCIAL INFORMATION | |||
1. | |||
2. | |||
3. | |||
4. | |||
PART II - OTHER INFORMATION | |||
1. | |||
2. | |||
6. | |||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
SALES | $115,801 | $163,145 | $256,106 | $306,332 | |||||||||||
Costs and Expenses | |||||||||||||||
Cost of sales | 103,689 | 123,096 | 210,923 | 238,995 | |||||||||||
Selling and general expenses | 12,727 | 13,861 | 23,626 | 27,098 | |||||||||||
Other operating income, net (Note 17) | (7,138 | ) | (11,389 | ) | (12,713 | ) | (11,764 | ) | |||||||
109,278 | 125,568 | 221,836 | 254,329 | ||||||||||||
OPERATING INCOME | 6,523 | 37,577 | 34,270 | 52,003 | |||||||||||
Interest expense | (8,483 | ) | (15,612 | ) | (17,027 | ) | (26,286 | ) | |||||||
Interest income and miscellaneous expense, net | (1,196 | ) | (4,385 | ) | (2,691 | ) | (5,397 | ) | |||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (3,156 | ) | 17,580 | 14,552 | 20,320 | ||||||||||
Income tax benefit (expense) | 296 | (13,556 | ) | 768 | (5,961 | ) | |||||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS | (2,860 | ) | 4,024 | 15,320 | 14,359 | ||||||||||
DISCONTINUED OPERATIONS, NET (Note 2) | |||||||||||||||
Income from discontinued operations, net of income tax expense of $0, $5,966, $0 and $21,231 | — | 12,084 | — | 43,092 | |||||||||||
NET (LOSS) INCOME | (2,860 | ) | 16,108 | 15,320 | 57,451 | ||||||||||
Less: Net loss attributable to noncontrolling interest | (1,324 | ) | (245 | ) | (891 | ) | (328 | ) | |||||||
NET (LOSS) INCOME ATTRIBUTABLE TO RAYONIER INC. | (1,536 | ) | 16,353 | 16,211 | 57,779 | ||||||||||
OTHER COMPREHENSIVE (LOSS) INCOME | |||||||||||||||
Foreign currency translation adjustment, net of income tax expense of $732, $0, $1,074 and $0 | (25,395 | ) | 3,517 | (39,717 | ) | 21,320 | |||||||||
New Zealand joint venture cash flow hedges, net of income tax benefit (expense) of $1,133, $401, $1,501 and ($100) | (2,917 | ) | (920 | ) | (3,863 | ) | 791 | ||||||||
Amortization of pension and postretirement plans, net of income tax expense of $179, $35,944, $337 and $36,875 | 743 | 58,873 | 1,524 | 60,970 | |||||||||||
Total other comprehensive (loss) income | (27,569 | ) | 61,470 | (42,056 | ) | 83,081 | |||||||||
COMPREHENSIVE (LOSS) INCOME | (30,429 | ) | 77,578 | (26,736 | ) | 140,532 | |||||||||
Less: Comprehensive (loss) income attributable to noncontrolling interest | (9,731 | ) | 297 | (13,522 | ) | 5,722 | |||||||||
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO RAYONIER INC. | ($20,698 | ) | $77,281 | ($13,214 | ) | $134,810 | |||||||||
(LOSS) EARNINGS PER COMMON SHARE (Note 3) | |||||||||||||||
BASIC (LOSS) EARNINGS PER SHARE ATTRIBUTABLE TO RAYONIER INC. | |||||||||||||||
Continuing Operations | ($0.01 | ) | $0.03 | $0.13 | $0.12 | ||||||||||
Discontinued Operations | — | 0.10 | — | 0.34 | |||||||||||
Net (Loss) Income | ($0.01 | ) | $0.13 | $0.13 | $0.46 | ||||||||||
DILUTED (LOSS) EARNINGS PER SHARE ATTRIBUTABLE TO RAYONIER INC. | |||||||||||||||
Continuing Operations | ($0.01 | ) | $0.03 | $0.13 | $0.11 | ||||||||||
Discontinued Operations | — | 0.09 | — | 0.33 | |||||||||||
Net (Loss) Income | ($0.01 | ) | $0.12 | $0.13 | $0.44 | ||||||||||
Dividends declared per share | $0.25 | $0.49 | $0.50 | $0.98 |
June 30, 2015 | December 31, 2014 | ||||||
ASSETS | |||||||
CURRENT ASSETS | |||||||
Cash and cash equivalents | $91,632 | $161,558 | |||||
Accounts receivable, less allowance for doubtful accounts of $42 and $42 | 19,444 | 24,018 | |||||
Inventory (Note 14) | 13,362 | 8,383 | |||||
Prepaid and other current assets | 21,222 | 19,745 | |||||
Total current assets | 145,660 | 213,704 | |||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | 2,086,729 | 2,088,501 | |||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS (NOTE 5) | 69,726 | 77,433 | |||||
PROPERTY, PLANT AND EQUIPMENT | |||||||
Land | 1,833 | 1,833 | |||||
Buildings | 8,977 | 8,961 | |||||
Machinery and equipment | 3,388 | 3,503 | |||||
Construction in progress | 772 | 579 | |||||
Total property, plant and equipment, gross | 14,970 | 14,876 | |||||
Less — accumulated depreciation | (8,536 | ) | (8,170 | ) | |||
Total property, plant and equipment, net | 6,434 | 6,706 | |||||
OTHER ASSETS | 57,772 | 66,771 | |||||
TOTAL ASSETS | $2,366,321 | $2,453,115 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
CURRENT LIABILITIES | |||||||
Accounts payable | $22,396 | $20,211 | |||||
Current maturities of long-term debt | 30,000 | 129,706 | |||||
Accrued taxes | 15,811 | 11,405 | |||||
Accrued payroll and benefits | 4,596 | 6,390 | |||||
Accrued interest | 8,043 | 8,433 | |||||
Other current liabilities | 31,614 | 25,857 | |||||
Total current liabilities | 112,460 | 202,002 | |||||
LONG-TERM DEBT | 722,353 | 621,849 | |||||
PENSION AND OTHER POSTRETIREMENT BENEFITS (Note 13) | 33,396 | 33,477 | |||||
OTHER NON-CURRENT LIABILITIES | 20,840 | 20,636 | |||||
COMMITMENTS AND CONTINGENCIES (Notes 11 and 12) | |||||||
SHAREHOLDERS’ EQUITY | |||||||
Common Shares, 480,000,000 shares authorized, 126,492,061 and 126,773,097 shares issued and outstanding | 694,835 | 702,598 | |||||
Retained earnings | 743,528 | 790,697 | |||||
Accumulated other comprehensive loss | (34,250 | ) | (4,825 | ) | |||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,404,113 | 1,488,470 | |||||
Noncontrolling interest | 73,159 | 86,681 | |||||
TOTAL SHAREHOLDERS’ EQUITY | 1,477,272 | 1,575,151 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $2,366,321 | $2,453,115 |
Six Months Ended June 30, | |||||||
2015 | 2014 | ||||||
OPERATING ACTIVITIES | |||||||
Net income | $15,320 | $57,451 | |||||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||
Depreciation, depletion and amortization | 53,826 | 56,316 | |||||
Non-cash cost of land sold and real estate development costs recovered upon sale | 4,938 | 5,398 | |||||
Stock-based incentive compensation expense | 2,588 | 5,980 | |||||
Deferred income taxes | (1,322 | ) | 10,103 | ||||
Depreciation and amortization from discontinued operations | — | 37,985 | |||||
Amortization of losses from pension and postretirement plans | 1,861 | 5,896 | |||||
Other | 944 | (43 | ) | ||||
Changes in operating assets and liabilities: | |||||||
Receivables | 2,414 | 9,988 | |||||
Inventories | (8,107 | ) | 4,765 | ||||
Accounts payable | 3,874 | 27,299 | |||||
Income tax receivable/payable | (321 | ) | 5,217 | ||||
All other operating activities | 9,868 | 7,885 | |||||
Expenditures for dispositions and discontinued operations | — | (5,096 | ) | ||||
CASH PROVIDED BY OPERATING ACTIVITIES | 85,883 | 229,144 | |||||
INVESTING ACTIVITIES | |||||||
Capital expenditures | (26,130 | ) | (33,597 | ) | |||
Capital expenditures from discontinued operations | — | (47,050 | ) | ||||
Real estate development costs | (578 | ) | (2,595 | ) | |||
Purchase of timberlands | (88,414 | ) | (74,817 | ) | |||
Change in restricted cash | 4,160 | 63,128 | |||||
Other | 3,689 | (478 | ) | ||||
CASH USED FOR INVESTING ACTIVITIES | (107,273 | ) | (95,409 | ) | |||
FINANCING ACTIVITIES | |||||||
Issuance of debt | 59,100 | 1,238,389 | |||||
Repayment of debt | (31,472 | ) | (1,107,062 | ) | |||
Dividends paid | (63,421 | ) | (124,628 | ) | |||
Proceeds from the issuance of common shares | 718 | 3,347 | |||||
Repurchase of common shares | (9,057 | ) | (1,834 | ) | |||
Debt issuance costs | — | (12,380 | ) | ||||
Net cash disbursed upon spin-off of Performance Fibers business | — | (106,420 | ) | ||||
Other | — | (680 | ) | ||||
CASH USED FOR FINANCING ACTIVITIES | (44,132 | ) | (111,268 | ) | |||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (4,404 | ) | (50 | ) | |||
CASH AND CASH EQUIVALENTS | |||||||
Change in cash and cash equivalents | (69,926 | ) | 22,417 | ||||
Balance, beginning of year | 161,558 | 199,644 | |||||
Balance, end of period | $91,632 | $222,061 | |||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid during the period: | |||||||
Interest (a) | $15,303 | $26,980 | |||||
Income taxes | 270 | 10,417 | |||||
Non-cash investing activity: | |||||||
Capital assets purchased on account | 2,396 | 11,547 |
(a) | Interest paid is presented net of patronage refunds received of $1.3 million for the six months ended June 30, 2015 and $2.1 million for the six months ended June 30, 2014. For additional information on patronage refunds, see Note 13 — Debt in the 2014 Form 10-K. |
1. | BASIS OF PRESENTATION |
2. | DISCONTINUED OPERATIONS |
Three Months Ended June 30, 2014 | Six Months Ended June 30, 2014 | ||||||
Sales | $212,680 | $456,180 | |||||
Cost of sales and other | (174,961 | ) | (368,868 | ) | |||
Transaction expenses | (19,669 | ) | (22,989 | ) | |||
Income from discontinued operations before income taxes | 18,050 | 64,323 | |||||
Income tax expense | (5,966 | ) | (21,231 | ) | |||
Income from discontinued operations, net | $12,084 | $43,092 |
Three Months Ended June 30, 2014 | Six Months Ended June 30, 2014 | ||||||
Interest expense allocated to the Performance Fibers business | ($1,910 | ) | ($4,205 | ) |
Three Months Ended June 30, 2014 | Six Months Ended June 30, 2014 | ||||||
Depreciation and amortization | $17,336 | $37,985 | |||||
Capital expenditures | 29,880 | 47,050 |
Three Months Ended June 30, 2014 | Six Months Ended June 30, 2014 | ||||||
Hardwood purchases | $1,190 | $3,935 |
3. | (LOSS) EARNINGS PER COMMON SHARE |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
(Loss) income from continuing operations | ($2,860 | ) | $4,024 | $15,320 | $14,359 | ||||||||||
Less: Net (loss) from continuing operations attributable to noncontrolling interest | (1,324 | ) | (245 | ) | (891 | ) | (328 | ) | |||||||
(Loss) income from continuing operations attributable to Rayonier Inc. | ($1,536 | ) | $4,269 | $16,211 | $14,687 | ||||||||||
Income from discontinued operations, net, attributable to Rayonier Inc. | — | $12,084 | — | 43,092 | |||||||||||
Net (loss) income attributable to Rayonier Inc. | ($1,536 | ) | $16,353 | $16,211 | $57,779 | ||||||||||
Shares used for determining basic (loss) earnings per common share | 126,635,710 | 126,434,376 | 126,625,081 | 126,390,891 | |||||||||||
Dilutive effect of: | |||||||||||||||
Stock options | — | 293,213 | 146,754 | 296,768 | |||||||||||
Performance and restricted shares | — | 201,956 | 30,515 | 194,995 | |||||||||||
Assumed conversion of Senior Exchangeable Notes (a) | — | 2,631,514 | 702,301 | 2,579,402 | |||||||||||
Assumed conversion of warrants (a) | — | 2,738,606 | — | 2,656,633 | |||||||||||
Shares used for determining diluted (loss) earnings per common share | 126,635,710 | 132,299,665 | 127,504,651 | 132,118,689 | |||||||||||
Basic (loss) earnings per common share attributable to Rayonier Inc.: | |||||||||||||||
Continuing operations | ($0.01 | ) | $0.03 | $0.13 | $0.12 | ||||||||||
Discontinued operations | — | 0.10 | — | 0.34 | |||||||||||
Net (loss) income | ($0.01 | ) | $0.13 | $0.13 | $0.46 | ||||||||||
Diluted (loss) earnings per common share attributable to Rayonier Inc.: | |||||||||||||||
Continuing operations | ($0.01 | ) | $0.03 | $0.13 | $0.11 | ||||||||||
Discontinued operations | — | 0.09 | — | 0.33 | |||||||||||
Net (loss) income | ($0.01 | ) | $0.12 | $0.13 | $0.44 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||
Anti-dilutive shares excluded from the computations of diluted (loss) earnings per share: | |||||||||||
Stock options, performance and restricted shares (b) | 158,191 | 507,044 | 937,236 | 499,193 | |||||||
Assumed conversion of exchangeable note hedges (a) | — | 2,631,514 | 702,301 | 2,579,402 | |||||||
Assumed conversion of Senior Exchangeable Notes due 2015 (b) | 501,189 | — | — | — | |||||||
Total | 659,380 | 3,138,558 | 1,639,537 | 3,078,595 |
Three Months Ended June 30, | |||||||||||||
2015 | 2014 | ||||||||||||
Income tax (benefit) expense at federal statutory rate | ($1,105 | ) | 35.0 | % | $6,153 | 35.0 | % | ||||||
REIT income and taxable losses | 1,077 | (34.1 | ) | (5,625 | ) | (32.0 | ) | ||||||
Foreign operations | 101 | (3.2 | ) | (728 | ) | (4.1 | ) | ||||||
Net operating loss valuation allowance | (216 | ) | 6.9 | — | — | ||||||||
Non-deductible real estate losses | — | — | 590 | 3.4 | |||||||||
Other | (153 | ) | 4.8 | 119 | 0.6 | ||||||||
Income tax (benefit) expense before discrete items | ($296 | ) | 9.4 | % | $509 | 2.9 | % | ||||||
CBPC valuation allowance | — | — | 15,574 | 88.7 | |||||||||
Spin-off related costs | — | — | 797 | 4.5 | |||||||||
Deferred tax inventory valuations | — | — | (3,293 | ) | (18.7 | ) | |||||||
Other | — | — | (31 | ) | (0.3 | ) | |||||||
Income tax (benefit) expense as reported for continuing operations | ($296 | ) | 9.4 | % | $13,556 | 77.1 | % | ||||||
Six Months Ended June 30, | |||||||||||||
2015 | 2014 | ||||||||||||
Income tax expense at federal statutory rate | $5,093 | 35.0 | % | $7,112 | 35.0 | % | |||||||
REIT income and taxable losses | (6,894 | ) | (47.4 | ) | (13,823 | ) | (69.3 | ) | |||||
Foreign operations | (645 | ) | (4.4 | ) | (841 | ) | (0.3 | ) | |||||
Net operating loss valuation allowance | 1,386 | 9.5 | — | — | |||||||||
Non-deductible real estate losses | — | — | 681 | 1.2 | |||||||||
Other | 292 | 2.0 | 138 | 0.3 | |||||||||
Income tax benefit before discrete items | ($768 | ) | (5.3 | )% | ($6,733 | ) | (33.1 | )% | |||||
CBPC valuation allowance | — | — | 15,574 | 76.6 | |||||||||
Spin-off related costs | — | — | 797 | 3.9 | |||||||||
Deferred tax inventory valuations | — | — | (3,293 | ) | (16.2 | ) | |||||||
Other | — | — | (384 | ) | (1.9 | ) | |||||||
Income tax (benefit) expense as reported for continuing operations | ($768 | ) | (5.3 | )% | $5,961 | 29.3 | % |
Higher and Better Use Timberlands and Real Estate Development Costs | |||||||||||
Land and Timber | Development Costs | Total | |||||||||
Non-current portion at December 31, 2014 | $65,959 | $11,474 | $77,433 | ||||||||
Plus: Current portion (a) | 4,875 | 57 | 4,932 | ||||||||
Total Balance at December 31, 2014 | 70,834 | 11,531 | 82,365 | ||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | (4,205 | ) | (57 | ) | (4,262 | ) | |||||
Timber depletion from harvesting activities and basis of timber sold in real estate sales | (1,340 | ) | — | (1,340 | ) | ||||||
Capitalized real estate development costs (b) | — | 926 | 926 | ||||||||
Capital expenditures (silviculture) | 100 | — | 100 | ||||||||
Acquisitions | — | — | — | ||||||||
Transfers | — | — | — | ||||||||
Other | — | (28 | ) | (28 | ) | ||||||
Total Balance at June 30, 2015 | 65,389 | 12,372 | 77,761 | ||||||||
Less: Current portion (a) | (7,488 | ) | (547 | ) | (8,035 | ) | |||||
Non-current portion at June 30, 2015 | $57,901 | $11,825 | $69,726 |
(a) | The current portion of Higher and Better Use Timberlands and Real Estate Development Costs is recorded in Inventory. See Note 14 — Inventory for additional information. |
(b) | Capitalized real estate development costs for the six months ended June 30, 2015 of $926,000 consisted of $578,000 in cash outflows and a $348,000 change in accrued spending. |
6. | RESTRICTED DEPOSITS |
7. | SHAREHOLDERS’ EQUITY |
Rayonier Inc. Shareholders’ Equity | ||||||||||||||||||||||
Common Shares | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Non-controlling Interest | Total Shareholders’ Equity | ||||||||||||||||||
Shares (a) | Amount | |||||||||||||||||||||
Balance, December 31, 2013 | 126,257,870 | $692,100 | $1,015,209 | ($46,139 | ) | $94,073 | $1,755,243 | |||||||||||||||
Net income (loss) | — | — | 99,337 | — | (1,491 | ) | 97,846 | |||||||||||||||
Dividends ($2.03 per share) | — | — | (256,861 | ) | — | — | (256,861 | ) | ||||||||||||||
Contribution to Rayonier Advanced Materials | — | (301 | ) | (61,318 | ) | 80,749 | — | 19,130 | ||||||||||||||
Adjustments to Rayonier Advanced Materials (b) | — | — | (5,670 | ) | (2,556 | ) | — | (8,226 | ) | |||||||||||||
Issuance of shares under incentive stock plans | 561,701 | 5,579 | — | — | — | 5,579 | ||||||||||||||||
Stock-based compensation | — | 7,869 | — | — | — | 7,869 | ||||||||||||||||
Tax deficiency on stock-based compensation | — | (791 | ) | — | — | — | (791 | ) | ||||||||||||||
Repurchase of common shares | (46,474 | ) | (1,858 | ) | — | — | — | (1,858 | ) | |||||||||||||
Net loss from pension and postretirement plans | — | — | — | (24,147 | ) | — | (24,147 | ) | ||||||||||||||
Noncontrolling interest redemption of shares | — | — | — | — | (931 | ) | (931 | ) | ||||||||||||||
Foreign currency translation adjustment | — | — | — | (11,526 | ) | (4,321 | ) | (15,847 | ) | |||||||||||||
Joint venture cash flow hedges | — | — | — | (1,206 | ) | (649 | ) | (1,855 | ) | |||||||||||||
Balance, December 31, 2014 | 126,773,097 | $702,598 | $790,697 | ($4,825 | ) | $86,681 | $1,575,151 | |||||||||||||||
Net income (loss) | — | — | 16,211 | — | (891 | ) | 15,320 | |||||||||||||||
Dividends ($0.50 per share) | — | — | (63,380 | ) | — | — | (63,380 | ) | ||||||||||||||
Issuance of shares under incentive stock plans | 134,448 | 718 | — | — | — | 718 | ||||||||||||||||
Stock-based compensation | — | 2,588 | — | — | — | 2,588 | ||||||||||||||||
Tax deficiency on stock-based compensation | — | (272 | ) | — | — | — | (272 | ) | ||||||||||||||
Repurchase of common shares (c) (d) | (415,484 | ) | (10,797 | ) | — | — | — | (10,797 | ) | |||||||||||||
Net gain from pension and postretirement plans | — | — | — | 1,524 | — | 1,524 | ||||||||||||||||
Foreign currency translation adjustment | — | — | — | (28,438 | ) | (11,279 | ) | (39,717 | ) | |||||||||||||
Joint venture cash flow hedges | — | — | — | (2,511 | ) | (1,352 | ) | (3,863 | ) | |||||||||||||
Balance, June 30, 2015 | 126,492,061 | $694,835 | $743,528 | ($34,250 | ) | $73,159 | $1,477,272 |
(a) | The Company’s common shares are registered in North Carolina and have a $0.00 par value. |
(b) | Primarily relates to adjustments made to the Rayonier Advanced Materials contribution as income taxes and pension and postretirement plan assets and obligations were finalized. |
(c) | During the second quarter the Company repurchased approximately $10.7 million of common stock at an average price of $25.94 per share. As of June 30, 2015, the Company had 126.5 million shares of common stock outstanding and $89.3 million remaining in its share repurchase authorization announced in June 2015. |
(d) | Includes shares of the Company’s common stock purchased from employees in non-open market transactions. The shares of stock were sold by current and former employees of the Company in exchange for cash that was used to pay withholding taxes associated with the vesting of restricted stock awards under the Company’s stock incentive plan. The price per share surrendered is based on the closing price of the company’s stock on the respective vesting dates of the awards. |
8. | SEGMENT AND GEOGRAPHICAL INFORMATION |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
SALES | 2015 | 2014 | 2015 | 2014 | |||||||||||
Southern Timber | $32,681 | $31,525 | $68,212 | $65,402 | |||||||||||
Pacific Northwest Timber | 17,102 | 25,053 | 36,256 | 58,090 | |||||||||||
New Zealand Timber | 39,223 | 44,543 | 80,417 | 82,307 | |||||||||||
Real Estate | 6,945 | 34,017 | 30,736 | 39,547 | |||||||||||
Trading | 19,850 | 29,224 | 40,485 | 64,910 | |||||||||||
Intersegment Eliminations | — | (1,217 | ) | — | (3,924 | ) | |||||||||
Total | $115,801 | $163,145 | $256,106 | $306,332 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
OPERATING INCOME | 2015 | 2014 | 2015 | 2014 | |||||||||||
Southern Timber | $11,777 | $8,886 | $24,190 | $19,379 | |||||||||||
Pacific Northwest Timber | 1,687 | 8,785 | 4,275 | 21,427 | |||||||||||
New Zealand Timber | (945 | ) | 2,249 | 4,749 | 4,660 | ||||||||||
Real Estate | 1,421 | 27,764 | 14,003 | 28,489 | |||||||||||
Trading | (84 | ) | (132 | ) | 186 | (544 | ) | ||||||||
Corporate and other | (7,333 | ) | (9,975 | ) | (13,133 | ) | (21,408 | ) | |||||||
Total Operating Income | $6,523 | $37,577 | 34,270 | 52,003 | |||||||||||
Unallocated interest expense and other | (9,679 | ) | ($19,997 | ) | (19,718 | ) | (31,683 | ) | |||||||
Total (loss) income from continuing operations before income taxes | ($3,156 | ) | $17,580 | $14,552 | $20,320 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
DEPRECIATION, DEPLETION AND AMORTIZATION | 2015 | 2014 | 2015 | 2014 | |||||||||||
Southern Timber | $12,650 | $10,709 | $26,951 | $22,705 | |||||||||||
Pacific Northwest Timber | 2,941 | 5,194 | 6,731 | 11,492 | |||||||||||
New Zealand Timber | 7,183 | 7,669 | 15,186 | 14,163 | |||||||||||
Real Estate | 1,006 | 6,422 | 4,818 | 7,333 | |||||||||||
Trading | — | — | — | — | |||||||||||
Corporate and other | 70 | 341 | 140 | 623 | |||||||||||
Total | $23,850 | $30,335 | $53,826 | $56,316 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
NON-CASH COST OF LAND SOLD AND REAL ESTATE COSTS RECOVERED UPON SALE | 2015 | 2014 | 2015 | 2014 | |||||||||||
Southern Timber | — | — | — | — | |||||||||||
Pacific Northwest Timber | — | — | — | — | |||||||||||
New Zealand Timber | — | (2 | ) | — | 2,096 | ||||||||||
Real Estate | 1,191 | 2,324 | 4,938 | 3,302 | |||||||||||
Trading | — | — | — | — | |||||||||||
Corporate and other | — | — | — | — | |||||||||||
Total | $1,191 | $2,322 | $4,938 | $5,398 |
9. | DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES |
Three Months Ended June 30, | |||||||||
Income Statement Location | 2015 | 2014 | |||||||
Derivatives designated as cash flow hedges: | |||||||||
Foreign currency exchange contracts | Other comprehensive (loss) income | ($1,621 | ) | ($818 | ) | ||||
Foreign currency option contracts | Other comprehensive (loss) income | (2,658 | ) | (504 | ) | ||||
Derivative designated as a net investment hedge: | |||||||||
Foreign currency exchange contract | Other comprehensive (loss) income | $2,173 | — | ||||||
Derivatives not designated as hedging instruments: | |||||||||
Foreign currency exchange contracts | Other operating (income) expense | — | — | ||||||
Foreign currency option contracts | Other operating (income) expense | 546 | — | ||||||
Interest rate swaps | Interest income and miscellaneous expense, net | (1,417 | ) | (729 | ) | ||||
Fuel hedge contracts | Cost of sales (benefit) | — | (92 | ) | |||||
Six Months Ended June 30, | |||||||||
Income Statement Location | 2015 | 2014 | |||||||
Derivatives designated as cash flow hedges: | |||||||||
Foreign currency exchange contracts | Other comprehensive (loss) income | ($2,308 | ) | $669 | |||||
Foreign currency option contracts | Other comprehensive (loss) income | (3,339 | ) | 221 | |||||
Derivative designated as a net investment hedge: | |||||||||
Foreign currency exchange contract | Other comprehensive (loss) income | 3,107 | — | ||||||
Derivatives not designated as hedging instruments: | |||||||||
Foreign currency exchange contracts | Other operating (income) expense | — | 25 | ||||||
Foreign currency option contracts | Other operating (income) expense | 546 | 7 | ||||||
Interest rate swaps | Interest and miscellaneous (expense) income, net | (3,273 | ) | (1,862 | ) | ||||
Fuel hedge contracts | Cost of sales (benefit) | — | 225 |
Notional Amount | |||||||
June 30, 2015 | December 31, 2014 | ||||||
Derivatives designated as cash flow hedges: | |||||||
Foreign currency exchange contracts | $28,200 | $28,540 | |||||
Foreign currency option contracts | 135,700 | 79,400 | |||||
Derivative designated as a net investment hedge: | |||||||
Foreign currency exchange contract | 23,828 | 27,419 | |||||
Derivatives not designated as hedging instruments: | |||||||
Interest rate swaps | 129,352 | 161,968 |
Location on Balance Sheet | Fair Value Assets / (Liabilities) (a) | ||||||||
June 30, 2015 | December 31, 2014 | ||||||||
Derivatives designated as cash flow hedges: | |||||||||
Foreign currency exchange contracts | Prepaid and other current assets | — | $132 | ||||||
Other assets | — | 59 | |||||||
Other current liabilities | (2,197 | ) | (272 | ) | |||||
Other non-current liabilities | (639 | ) | — | ||||||
Foreign currency option contracts | Prepaid and other current assets | — | 299 | ||||||
Other assets | — | 198 | |||||||
Other current liabilities | (3,614 | ) | (1,439 | ) | |||||
Other non-current liabilities | (653 | ) | (196 | ) | |||||
Derivative designated as a net investment hedge: | |||||||||
Foreign currency exchange contract | Prepaid and other current assets | 2,884 | — | ||||||
Other current liabilities | — | (223 | ) | ||||||
Derivatives not designated as hedging instruments: | |||||||||
Interest rate swaps | Other non-current liabilities | (8,271 | ) | (7,247 | ) | ||||
Total derivative contracts: | |||||||||
Prepaid and other current assets | $2,884 | $431 | |||||||
Other assets | — | 257 | |||||||
Total derivative assets | 2,884 | 688 | |||||||
Other current liabilities | (5,811 | ) | (1,934 | ) | |||||
Other non-current liabilities | (9,563 | ) | (7,443 | ) | |||||
Total derivative liabilities | ($15,374 | ) | ($9,377 | ) |
(a) | See Note 10 — Fair Value Measurements for further information on the fair value of the Company’s derivatives including their classification within the fair value hierarchy. |
10. | FAIR VALUE MEASUREMENTS |
June 30, 2015 | December 31, 2014 | ||||||||||||||||||||
Asset (liability) | Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||||||
Level 1 | Level 2 | Level 1 | Level 2 | ||||||||||||||||||
Cash and cash equivalents | $91,632 | $91,632 | — | $161,558 | $161,558 | — | |||||||||||||||
Restricted cash (a) | 2,528 | 2,528 | — | 6,688 | 6,688 | — | |||||||||||||||
Current maturities of long-term debt | (30,000 | ) | — | (32,812 | ) | (129,706 | ) | — | (156,762 | ) | |||||||||||
Long-term debt | (722,353 | ) | — | (725,543 | ) | (621,849 | ) | — | (628,476 | ) | |||||||||||
Interest rate swaps (b) | (8,271 | ) | — | (8,271 | ) | (7,247 | ) | — | (7,247 | ) | |||||||||||
Foreign currency exchange contracts (b) | 48 | — | 48 | (304 | ) | — | (304 | ) | |||||||||||||
Foreign currency option contracts (b) | (4,267 | ) | — | (4,267 | ) | (1,138 | ) | — | (1,138 | ) |
(a) | Restricted cash is recorded in “Other Assets” and represents the proceeds from LKE sales deposited with a third-party intermediary. |
(b) | See Note 9 — Derivative Financial Instruments and Hedging Activities for information regarding the Balance Sheet classification of the Company’s derivative financial instruments. |
11. | GUARANTEES |
Financial Commitments | Maximum Potential Payment | Carrying Amount of Associated Liability | ||||||
Standby letters of credit (a) | $16,685 | $15,000 | ||||||
Guarantees (b) | 2,254 | 43 | ||||||
Surety bonds (c) | 776 | — | ||||||
Total financial commitments | $19,715 | $15,043 |
(a) | Approximately $15 million of the standby letters of credit serve as credit support for industrial revenue bonds. The remaining letters of credit support various insurance related agreements, primarily workers’ compensation. These letters of credit will expire at various dates during 2015 and will be renewed as required. |
(b) | In conjunction with a timberland sale and note monetization in 2004, the Company issued a make-whole agreement pursuant to which it guaranteed $2.3 million of obligations of a special-purpose entity that was established to complete the monetization. At June 30, 2015, the Company has a de minimis liability to reflect the fair market value of its obligation to perform under the make-whole agreement. |
(c) | Rayonier issues surety bonds primarily to secure timber harvesting obligations in the State of Washington and to provide collateral for the Company’s workers’ compensation self-insurance program in that state. These surety bonds expire at various dates during 2015 and 2016 and are expected to be renewed as required. |
12. | CONTINGENCIES |
• | Sating v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01395; filed November 12, 2014 in the United States District Court for the Middle District of Florida; |
• | Keasler v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01398, filed November 13, 2014 in the United States District Court for the Middle District of Florida; |
• | Lake Worth Firefighters’ Pension Trust Fund v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01403, filed November 13, 2014 in the United States District Court for the Middle District of Florida; |
• | Christie v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01429, filed November 21, 2014 in the United States District Court for the Middle District of Florida; and |
• | Brown v. Rayonier Inc. et al, Civil Action No. 1:14-cv-08986, initially filed in the United States District Court for the Southern District of New York and later transferred to the United States District Court for the Middle District of Florida and assigned as Civil Action No. 3:14-cv-01474. |
13. | EMPLOYEE BENEFIT PLANS |
Pension | Postretirement | ||||||||||||||
Three Months Ended June 30, | Three Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Components of Net Periodic Benefit Cost | |||||||||||||||
Service cost | $371 | $1,544 | $3 | $147 | |||||||||||
Interest cost | 830 | 4,452 | 13 | 199 | |||||||||||
Expected return on plan assets | (1,007 | ) | (6,330 | ) | — | — | |||||||||
Amortization of prior service cost | 3 | 277 | — | 4 | |||||||||||
Amortization of losses | 916 | 2,603 | 3 | 116 | |||||||||||
Amortization of negative plan amendment | — | — | — | (133 | ) | ||||||||||
Net periodic benefit cost (a) | $1,113 | $2,546 | $19 | $333 |
Pension | Postretirement | ||||||||||||||
Six Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Components of Net Periodic Benefit Cost | |||||||||||||||
Service cost | $742 | $3,168 | $6 | $326 | |||||||||||
Interest cost | 1,659 | 9,135 | 26 | 405 | |||||||||||
Expected return on plan assets | (2,014 | ) | (12,988 | ) | — | — | |||||||||
Amortization of prior service cost | 6 | 569 | — | 8 | |||||||||||
Amortization of losses | 1,849 | 5,340 | 6 | 245 | |||||||||||
Amortization of negative plan amendment | — | — | — | (267 | ) | ||||||||||
Net periodic benefit cost (a) | $2,242 | $5,224 | $38 | $717 | |||||||||||
(a) | Net periodic benefit cost for the three and six months ended June 30, 2014 includes $2.0 million and $4.0 million, respectively, recorded in “Income from discontinued operations, net” on the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income. |
14. | INVENTORY |
June 30, 2015 | December 31, 2014 | ||||||
Finished goods inventory | |||||||
Real estate inventory (a) | $8,035 | $4,932 | |||||
Log inventory | 5,327 | 3,451 | |||||
Total inventory | $13,362 | $8,383 |
(a) | Represents HBU real estate (including capitalized development costs) expected to be sold within 12 months. |
15. | DEBT |
16. | ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS) |
Foreign currency translation gains/ (losses) | Net investment hedge of New Zealand JV | New Zealand JV cash flow hedges | Unrecognized components of employee benefit plans | Total | |||||||||||||||
Balance as of December 31, 2013 | $36,914 | — | ($342 | ) | ($82,711 | ) | ($46,139 | ) | |||||||||||
Other comprehensive income/(loss) before reclassifications | (11,381 | ) | (145 | ) | 510 | 47,938 | (a) | 36,922 | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | — | (1,716 | ) | 6,108 | (b) | 4,392 | ||||||||||||
Net other comprehensive income/(loss) | (11,381 | ) | (145 | ) | (1,206 | ) | 54,046 | 41,314 | |||||||||||
Balance as of December 31, 2014 | $25,533 | ($145 | ) | ($1,548 | ) | ($28,665 | ) | ($4,825 | ) | ||||||||||
Other comprehensive income/(loss) before reclassifications | (30,456 | ) | 2,019 | (3,700 | ) | — | (32,137 | ) | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | — | 1,188 | 1,524 | (c) | 2,712 | |||||||||||||
Net other comprehensive income/(loss) | (30,456 | ) | 2,019 | (2,512 | ) | 1,524 | (29,425 | ) | |||||||||||
Balance as of June 30, 2015 | ($4,923 | ) | $1,874 | ($4,060 | ) | ($27,141 | ) | ($34,250 | ) |
(a) | Reflects $78 million, net of taxes, of comprehensive income due to the transfer of losses to Rayonier Advanced Materials Pension Plans. This comprehensive income was offset by $30 million, net of taxes, of losses as a result of revaluations required due to the spin-off at December 31, 2014. See Note 22 — Employee Benefit Plans in the 2014 Form 10-K for additional information. |
(b) | This accumulated other comprehensive income component is comprised of $5 million from the computation of net periodic pension cost and the $1 million write-off of a deferred tax asset related to the revaluation and transfer of liabilities as a result of the spin-off. |
(c) | This component of other comprehensive income is included in the computation of net periodic pension cost. See Note 13 — Employee Benefit Plans for additional information. |
Details about accumulated other comprehensive income components | Amount reclassified from accumulated other comprehensive income | Affected line item in the income statement | ||||||||
June 30, 2015 | June 30, 2014 | |||||||||
Realized loss (gain) on foreign currency exchange contracts | $1,504 | ($2,542 | ) | Other operating income, net | ||||||
Realized loss (gain) on foreign currency option contracts | 1,035 | (937 | ) | Other operating income, net | ||||||
Noncontrolling interest | (889 | ) | 1,218 | Comprehensive (loss) income attributable to noncontrolling interest | ||||||
Income tax (benefit) expense on loss from foreign currency contracts | (462 | ) | 254 | Income tax benefit | ||||||
Net gain on cash flow hedges reclassified from accumulated other comprehensive income | 1,188 | (2,007 | ) | |||||||
Income tax expense on pension plan contributed to Rayonier Advanced Materials | — | 843 | Income tax expense | |||||||
Net loss (gain) from accumulated other comprehensive income | $1,188 | ($1,164 | ) |
17. | OTHER OPERATING INCOME, NET |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Lease income, primarily from hunting leases | $5,890 | $3,966 | $9,999 | $7,003 | |||||||||||
Other non-timber income | 688 | 440 | 2,052 | 993 | |||||||||||
Foreign currency income (loss) | 108 | 1,232 | 215 | (255 | ) | ||||||||||
Gain (loss) on sale or disposal of property, plant & equipment | 3 | (20 | ) | 3 | (20 | ) | |||||||||
(Loss) gain on foreign currency exchange contracts | (645 | ) | — | (994 | ) | (32 | ) | ||||||||
Bankruptcy claim settlement | — | 5,779 | — | 5,779 | |||||||||||
Gain (loss) on sale of carbon credits (a) | 352 | (307 | ) | 352 | (307 | ) | |||||||||
Miscellaneous income (expense), net | 742 | 299 | 1,086 | (1,397 | ) | ||||||||||
Total | $7,138 | $11,389 | $12,713 | $11,764 |
(a) | Loss in 2014 reflects surrender of carbon credit units. |
18. | CONSOLIDATING FINANCIAL STATEMENTS |
CONDENSED CONSOLIDATING STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME | |||||||||||||||||||||||
For the Three Months Ended June 30, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
SALES | — | — | — | $115,801 | — | $115,801 | |||||||||||||||||
Costs and Expenses | |||||||||||||||||||||||
Cost of sales | — | — | — | 103,689 | — | 103,689 | |||||||||||||||||
Selling and general expenses | — | 6,330 | — | 6,397 | — | 12,727 | |||||||||||||||||
Other operating expense (income), net | — | (461 | ) | — | (6,677 | ) | — | (7,138 | ) | ||||||||||||||
— | 5,869 | — | 103,409 | — | 109,278 | ||||||||||||||||||
OPERATING (LOSS) INCOME | — | (5,869 | ) | — | 12,392 | — | 6,523 | ||||||||||||||||
Interest expense | (3,169 | ) | (131 | ) | (2,409 | ) | (2,774 | ) | — | (8,483 | ) | ||||||||||||
Interest and miscellaneous income (expense), net | 1,871 | 817 | (137 | ) | (3,747 | ) | — | (1,196 | ) | ||||||||||||||
Equity in (loss) income from subsidiaries | (238 | ) | 4,966 | 2,796 | — | (7,524 | ) | — | |||||||||||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (1,536 | ) | (217 | ) | 250 | 5,871 | (7,524 | ) | (3,156 | ) | |||||||||||||
Income tax (expense) benefit | — | (21 | ) | 948 | (631 | ) | — | 296 | |||||||||||||||
NET (LOSS) INCOME | (1,536 | ) | (238 | ) | 1,198 | 5,240 | (7,524 | ) | (2,860 | ) | |||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | — | (1,324 | ) | — | (1,324 | ) | |||||||||||||||
NET (LOSS) INCOME ATTRIBUTABLE TO RAYONIER INC. | (1,536 | ) | (238 | ) | 1,198 | 6,564 | (7,524 | ) | (1,536 | ) | |||||||||||||
OTHER COMPREHENSIVE LOSS | |||||||||||||||||||||||
Foreign currency translation adjustment | (18,008 | ) | (18,008 | ) | (74 | ) | (25,395 | ) | 36,090 | (25,395 | ) | ||||||||||||
New Zealand joint venture cash flow hedges | (1,896 | ) | (1,896 | ) | (1,896 | ) | (2,917 | ) | 5,688 | (2,917 | ) | ||||||||||||
Amortization of pension and postretirement plans, net of income tax | 743 | 743 | (5 | ) | (5 | ) | (733 | ) | 743 | ||||||||||||||
Total other comprehensive loss | (19,161 | ) | (19,161 | ) | (1,975 | ) | (28,317 | ) | 41,045 | (27,569 | ) | ||||||||||||
COMPREHENSIVE LOSS | (20,697 | ) | (19,399 | ) | (777 | ) | (23,077 | ) | 33,521 | (30,429 | ) | ||||||||||||
Less: Comprehensive loss attributable to noncontrolling interest | — | — | — | (9,730 | ) | (1 | ) | (9,731 | ) | ||||||||||||||
COMPREHENSIVE LOSS ATTRIBUTABLE TO RAYONIER INC. | ($20,697 | ) | ($19,399 | ) | ($777 | ) | ($13,347 | ) | $33,522 | ($20,698 | ) | ||||||||||||
CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | |||||||||||||||||||||||
For the Three Months Ended June 30, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
SALES | — | — | — | $163,145 | — | $163,145 | |||||||||||||||||
Costs and Expenses | |||||||||||||||||||||||
Cost of sales | — | — | — | 123,096 | — | 123,096 | |||||||||||||||||
Selling and general expenses | — | 2,394 | — | 11,467 | — | 13,861 | |||||||||||||||||
Other operating expense (income), net | — | 1,573 | — | (12,962 | ) | — | (11,389 | ) | |||||||||||||||
— | 3,967 | — | 121,601 | — | 125,568 | ||||||||||||||||||
OPERATING (LOSS) INCOME | — | (3,967 | ) | — | 41,544 | — | 37,577 | ||||||||||||||||
Interest expense | (3,196 | ) | (225 | ) | (10,982 | ) | (1,209 | ) | — | (15,612 | ) | ||||||||||||
Interest and miscellaneous income (expense), net | 2,733 | (3,003 | ) | (1,098 | ) | (3,017 | ) | — | (4,385 | ) | |||||||||||||
Equity in income (loss) from subsidiaries | 16,814 | 23,549 | (54,081 | ) | — | 13,718 | — | ||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 16,351 | 16,354 | (66,161 | ) | 37,318 | 13,718 | 17,580 | ||||||||||||||||
Income tax benefit (expense) | — | 460 | 4,409 | (18,425 | ) | — | (13,556 | ) | |||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | 16,351 | 16,814 | (61,752 | ) | 18,893 | 13,718 | 4,024 | ||||||||||||||||
DISCONTINUED OPERATIONS, NET | |||||||||||||||||||||||
Income from discontinued operations, net of income taxes | — | — | — | 12,084 | — | 12,084 | |||||||||||||||||
NET INCOME (LOSS) | 16,351 | 16,814 | (61,752 | ) | 30,977 | 13,718 | 16,108 | ||||||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | — | (245 | ) | — | (245 | ) | |||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO RAYONIER INC. | 16,351 | 16,814 | (61,752 | ) | 31,222 | 13,718 | 16,353 | ||||||||||||||||
OTHER COMPREHENSIVE INCOME | |||||||||||||||||||||||
Foreign currency translation adjustment | 2,653 | 2,653 | 513 | 3,517 | (5,819 | ) | 3,517 | ||||||||||||||||
New Zealand joint venture cash flow hedges | (598 | ) | (598 | ) | (598 | ) | (920 | ) | 1,794 | (920 | ) | ||||||||||||
Amortization of pension and postretirement plans, net of income tax | 58,873 | 58,873 | 92,714 | 92,714 | (244,301 | ) | 58,873 | ||||||||||||||||
Total other comprehensive income | 60,928 | 60,928 | 92,629 | 95,311 | (248,326 | ) | 61,470 | ||||||||||||||||
COMPREHENSIVE INCOME | 77,279 | 77,742 | 30,877 | 126,288 | (234,608 | ) | 77,578 | ||||||||||||||||
Less: Comprehensive income attributable to noncontrolling interest | — | — | — | 297 | — | 297 | |||||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $77,279 | $77,742 | $30,877 | $125,991 | ($234,608 | ) | $77,281 | ||||||||||||||||
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | |||||||||||||||||||||||
For the Six Months Ended June 30, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
SALES | — | — | — | $256,106 | — | $256,106 | |||||||||||||||||
Costs and Expenses | |||||||||||||||||||||||
Cost of sales | — | — | — | 210,923 | — | 210,923 | |||||||||||||||||
Selling and general expenses | — | 11,279 | — | 12,347 | — | 23,626 | |||||||||||||||||
Other operating income, net | — | (461 | ) | — | (12,252 | ) | — | (12,713 | ) | ||||||||||||||
— | 10,818 | — | 211,018 | — | 221,836 | ||||||||||||||||||
OPERATING (LOSS) INCOME | — | (10,818 | ) | — | 45,088 | — | 34,270 | ||||||||||||||||
Interest expense | (6,337 | ) | (223 | ) | (4,841 | ) | (5,626 | ) | — | (17,027 | ) | ||||||||||||
Interest and miscellaneous income (expense), net | 3,807 | 1,654 | (281 | ) | (7,871 | ) | — | (2,691 | ) | ||||||||||||||
Equity in income from subsidiaries | 18,741 | 28,149 | 4,223 | — | (51,113 | ) | — | ||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 16,211 | 18,762 | (899 | ) | 31,591 | (51,113 | ) | 14,552 | |||||||||||||||
Income tax (expense) benefit | — | (21 | ) | 1,908 | (1,119 | ) | — | 768 | |||||||||||||||
NET INCOME | 16,211 | 18,741 | 1,009 | 30,472 | (51,113 | ) | 15,320 | ||||||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | — | (891 | ) | — | (891 | ) | |||||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 16,211 | 18,741 | 1,009 | 31,363 | (51,113 | ) | 16,211 | ||||||||||||||||
OTHER COMPREHENSIVE LOSS | |||||||||||||||||||||||
Foreign currency translation adjustment | (28,438 | ) | (28,438 | ) | (926 | ) | (39,718 | ) | 57,803 | (39,717 | ) | ||||||||||||
New Zealand joint venture cash flow hedges | (2,511 | ) | (2,511 | ) | (2,511 | ) | (3,863 | ) | 7,533 | (3,863 | ) | ||||||||||||
Amortization of pension and postretirement plans, net of income tax | 1,524 | 1,524 | 15 | 15 | (1,554 | ) | 1,524 | ||||||||||||||||
Total other comprehensive loss | (29,425 | ) | (29,425 | ) | (3,422 | ) | (43,566 | ) | 63,782 | (42,056 | ) | ||||||||||||
COMPREHENSIVE LOSS | (13,214 | ) | (10,684 | ) | (2,413 | ) | (13,094 | ) | 12,669 | (26,736 | ) | ||||||||||||
Less: Comprehensive loss attributable to noncontrolling interest | — | — | — | (13,522 | ) | — | (13,522 | ) | |||||||||||||||
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO RAYONIER INC. | ($13,214 | ) | ($10,684 | ) | ($2,413 | ) | $428 | $12,669 | ($13,214 | ) | |||||||||||||
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | |||||||||||||||||||||||
For the Six Months Ended June 30, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non-guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
SALES | — | — | — | $306,332 | — | $306,332 | |||||||||||||||||
Costs and Expenses | |||||||||||||||||||||||
Cost of sales | — | — | — | 238,995 | — | 238,995 | |||||||||||||||||
Selling and general expenses | — | 4,544 | — | 22,554 | — | 27,098 | |||||||||||||||||
Other operating expense (income), net | — | 3,948 | — | (15,712 | ) | — | (11,764 | ) | |||||||||||||||
— | 8,492 | — | 245,837 | — | 254,329 | ||||||||||||||||||
OPERATING (LOSS) INCOME | — | (8,492 | ) | — | 60,495 | — | 52,003 | ||||||||||||||||
Interest expense | (6,389 | ) | (468 | ) | (17,672 | ) | (1,757 | ) | — | (26,286 | ) | ||||||||||||
Interest and miscellaneous income (expense), net | 5,431 | (2,189 | ) | (2,145 | ) | (6,494 | ) | — | (5,397 | ) | |||||||||||||
Equity in income (loss) from subsidiaries | 58,737 | 70,049 | (22,951 | ) | — | (105,835 | ) | — | |||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 57,779 | 58,900 | (42,768 | ) | 52,244 | (105,835 | ) | 20,320 | |||||||||||||||
Income tax (expense) benefit | — | (163 | ) | 7,233 | (13,031 | ) | — | (5,961 | ) | ||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS | 57,779 | 58,737 | (35,535 | ) | 39,213 | (105,835 | ) | 14,359 | |||||||||||||||
DISCONTINUED OPERATIONS, NET | |||||||||||||||||||||||
Income from discontinued operations, net of income taxes | — | — | — | 43,092 | — | 43,092 | |||||||||||||||||
NET INCOME (LOSS) | 57,779 | 58,737 | (35,535 | ) | 82,305 | (105,835 | ) | 57,451 | |||||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | — | (328 | ) | — | (328 | ) | |||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO RAYONIER INC. | 57,779 | 58,737 | (35,535 | ) | 82,633 | (105,835 | ) | 57,779 | |||||||||||||||
OTHER COMPREHENSIVE INCOME | |||||||||||||||||||||||
Foreign currency translation adjustment | 15,547 | 15,547 | 1,279 | 21,312 | (32,365 | ) | 21,320 | ||||||||||||||||
New Zealand joint venture cash flow hedges | 514 | 514 | 514 | 791 | (1,542 | ) | 791 | ||||||||||||||||
Amortization of pension and postretirement plans, net of income tax | 60,970 | 60,970 | 94,334 | 94,334 | (249,638 | ) | 60,970 | ||||||||||||||||
Total other comprehensive income | 77,031 | 77,031 | 96,127 | 116,437 | (283,545 | ) | 83,081 | ||||||||||||||||
COMPREHENSIVE INCOME | 134,810 | 135,768 | 60,592 | 198,742 | (389,380 | ) | 140,532 | ||||||||||||||||
Less: Comprehensive income attributable to noncontrolling interest | — | — | — | 5,722 | — | 5,722 | |||||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $134,810 | $135,768 | $60,592 | $193,020 | ($389,380 | ) | $134,810 | ||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEETS | |||||||||||||||||||||||
As of June 30, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
ASSETS | |||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||
Cash and cash equivalents | $5,366 | $94 | $45,847 | $40,325 | — | $91,632 | |||||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | — | 91 | 19,353 | — | 19,444 | |||||||||||||||||
Inventory | — | — | — | 13,362 | — | 13,362 | |||||||||||||||||
Prepaid and other current assets | — | 1,855 | 3,008 | 16,359 | — | 21,222 | |||||||||||||||||
Total current assets | 5,366 | 1,949 | 48,946 | 89,399 | — | 145,660 | |||||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | — | 2,086,729 | — | 2,086,729 | |||||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | — | 69,726 | — | 69,726 | |||||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 480 | — | 5,954 | — | 6,434 | |||||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,516,408 | 2,182,721 | 843,077 | — | (4,542,206 | ) | — | ||||||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 252,815 | — | 21,928 | — | (274,743 | ) | — | ||||||||||||||||
OTHER ASSETS | 2,570 | 16,476 | 1,325 | 37,401 | — | 57,772 | |||||||||||||||||
TOTAL ASSETS | $1,777,159 | $2,201,626 | $915,276 | $2,289,209 | ($4,816,949 | ) | $2,366,321 | ||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||
Accounts payable | — | $3,434 | $83 | $18,879 | — | $22,396 | |||||||||||||||||
Current maturities of long-term debt | — | — | 30,000 | — | — | 30,000 | |||||||||||||||||
Accrued taxes | — | 14 | — | 15,797 | — | 15,811 | |||||||||||||||||
Accrued payroll and benefits | — | 2,476 | — | 2,120 | — | 4,596 | |||||||||||||||||
Accrued interest | 3,046 | (12 | ) | 2,505 | 35,499 | (32,995 | ) | 8,043 | |||||||||||||||
Other current liabilities | — | 2,420 | 9,570 | 19,624 | — | 31,614 | |||||||||||||||||
Total current liabilities | 3,046 | 8,332 | 42,158 | 91,919 | (32,995 | ) | 112,460 | ||||||||||||||||
LONG-TERM DEBT | 370,000 | — | 115,972 | 236,381 | — | 722,353 | |||||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,081 | — | (685 | ) | — | 33,396 | ||||||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,615 | — | 14,225 | — | 20,840 | |||||||||||||||||
INTERCOMPANY PAYABLE | — | 636,190 | — | (254,315 | ) | (381,875 | ) | — | |||||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,404,113 | 1,516,408 | 757,146 | 2,128,525 | (4,402,079 | ) | 1,404,113 | ||||||||||||||||
Noncontrolling interest | — | — | — | 73,159 | — | 73,159 | |||||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,404,113 | 1,516,408 | 757,146 | 2,201,684 | (4,402,079 | ) | 1,477,272 | ||||||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,777,159 | $2,201,626 | $915,276 | $2,289,209 | ($4,816,949 | ) | $2,366,321 |
CONDENSED CONSOLIDATING BALANCE SHEETS | |||||||||||||||||||||||
As of December 31, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
ASSETS | |||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||
Cash and cash equivalents | $102,218 | $11 | $8,094 | $51,235 | — | $161,558 | |||||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | — | 1,409 | 22,609 | — | 24,018 | |||||||||||||||||
Inventory | — | — | — | 8,383 | — | 8,383 | |||||||||||||||||
Prepaid and other current assets | — | 2,003 | 6 | 17,736 | — | 19,745 | |||||||||||||||||
Total current assets | 102,218 | 2,014 | 9,509 | 99,963 | — | 213,704 | |||||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | — | 2,088,501 | — | 2,088,501 | |||||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | — | 77,433 | — | 77,433 | |||||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 433 | — | 6,273 | — | 6,706 | |||||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,463,303 | 1,923,185 | 640,678 | — | (4,027,166 | ) | — | ||||||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 248,233 | — | 21,500 | — | (269,733 | ) | — | ||||||||||||||||
OTHER ASSETS | 2,763 | 16,610 | 1,759 | 45,639 | — | 66,771 | |||||||||||||||||
TOTAL ASSETS | $1,816,517 | $1,942,242 | $673,446 | $2,317,809 | ($4,296,899 | ) | $2,453,115 | ||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||
Accounts payable | — | $2,687 | $123 | $17,401 | — | $20,211 | |||||||||||||||||
Current maturities of long-term debt | — | — | 129,706 | — | — | 129,706 | |||||||||||||||||
Accrued taxes | — | 11 | — | 11,394 | — | 11,405 | |||||||||||||||||
Accrued payroll and benefits | — | 3,253 | — | 3,137 | — | 6,390 | |||||||||||||||||
Accrued interest | 3,047 | (3 | ) | 2,520 | 31,281 | (28,412 | ) | 8,433 | |||||||||||||||
Other current liabilities | — | 928 | 145 | 24,784 | — | 25,857 | |||||||||||||||||
Total current liabilities | 3,047 | 6,876 | 132,494 | 87,997 | (28,412 | ) | 202,002 | ||||||||||||||||
LONG-TERM DEBT | 325,000 | — | 31,000 | 265,849 | — | 621,849 | |||||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,161 | — | (684 | ) | — | 33,477 | ||||||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,436 | — | 14,200 | — | 20,636 | |||||||||||||||||
INTERCOMPANY PAYABLE | — | 431,466 | — | (153,754 | ) | (277,712 | ) | — | |||||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 509,952 | 2,017,520 | (3,990,775 | ) | 1,488,470 | ||||||||||||||||
Noncontrolling interest | — | — | — | 86,681 | — | 86,681 | |||||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 509,952 | 2,104,201 | (3,990,775 | ) | 1,575,151 | ||||||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,816,517 | $1,942,242 | $673,446 | $2,317,809 | ($4,296,899 | ) | $2,453,115 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||
For the Six Months Ended June 30, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
CASH (USED FOR) PROVIDED BY OPERATING ACTIVITIES | ($25,092 | ) | ($13,561 | ) | — | $110,401 | $14,135 | $85,883 | |||||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||||||
Capital expenditures | — | (134 | ) | — | (25,996 | ) | — | (26,130 | ) | ||||||||||||||
Real estate development costs | — | — | — | (578 | ) | — | (578 | ) | |||||||||||||||
Purchase of timberlands | — | — | — | (88,414 | ) | — | (88,414 | ) | |||||||||||||||
Change in restricted cash | — | — | — | 4,160 | — | 4,160 | |||||||||||||||||
Investment in Subsidiaries | — | — | 8,753 | — | (8,753 | ) | — | ||||||||||||||||
Other | — | — | — | 3,689 | — | 3,689 | |||||||||||||||||
CASH (USED FOR) PROVIDED BY INVESTING ACTIVITIES | — | (134 | ) | 8,753 | (107,139 | ) | (8,753 | ) | (107,273 | ) | |||||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||||||
Issuance of debt | — | — | 57,000 | 2,100 | — | 59,100 | |||||||||||||||||
Repayment of debt | — | — | (28,000 | ) | (3,472 | ) | — | (31,472 | ) | ||||||||||||||
Dividends paid | (63,421 | ) | — | — | — | — | (63,421 | ) | |||||||||||||||
Proceeds from the issuance of common shares | 718 | — | — | — | — | 718 | |||||||||||||||||
Repurchase of common shares | (9,057 | ) | — | — | — | — | (9,057 | ) | |||||||||||||||
Intercompany distributions | — | 13,778 | — | (8,396 | ) | (5,382 | ) | — | |||||||||||||||
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES | (71,760 | ) | 13,778 | 29,000 | (9,768 | ) | (5,382 | ) | (44,132 | ) | |||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | — | (4,404 | ) | — | (4,404 | ) | |||||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||||||
Change in cash and cash equivalents | (96,852 | ) | 83 | 37,753 | (10,910 | ) | — | (69,926 | ) | ||||||||||||||
Balance, beginning of year | 102,218 | 11 | 8,094 | 51,235 | — | 161,558 | |||||||||||||||||
Balance, end of period | $5,366 | $94 | $45,847 | $40,325 | — | $91,632 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | |||||||||||||||||||||||
For the Six Months Ended June 30, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
CASH PROVIDED BY OPERATING ACTIVITIES | $138,535 | $150,518 | — | $87,098 | ($147,007 | ) | $229,144 | ||||||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||||||
Capital expenditures | — | (201 | ) | — | (33,396 | ) | — | (33,597 | ) | ||||||||||||||
Capital expenditures from discontinued operations | — | — | — | (47,050 | ) | — | (47,050 | ) | |||||||||||||||
Real estate development costs | — | — | — | (2,595 | ) | — | (2,595 | ) | |||||||||||||||
Purchase of timberlands | — | — | — | (74,817 | ) | — | (74,817 | ) | |||||||||||||||
Change in restricted cash | — | — | — | 63,128 | — | 63,128 | |||||||||||||||||
Investment in Subsidiaries | — | — | (62,800 | ) | — | 62,800 | — | ||||||||||||||||
Other | — | — | — | (478 | ) | — | (478 | ) | |||||||||||||||
CASH USED FOR INVESTING ACTIVITIES | — | (201 | ) | (62,800 | ) | (95,208 | ) | 62,800 | (95,409 | ) | |||||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||||||
Issuance of debt | — | — | 1,238,389 | — | — | 1,238,389 | |||||||||||||||||
Repayment of debt | — | — | (1,107,062 | ) | — | — | (1,107,062 | ) | |||||||||||||||
Dividends paid | (124,628 | ) | — | — | — | — | (124,628 | ) | |||||||||||||||
Proceeds from the issuance of common shares | 3,347 | — | — | — | — | 3,347 | |||||||||||||||||
Repurchase of common shares | (1,834 | ) | — | — | — | — | (1,834 | ) | |||||||||||||||
Debt issuance costs | — | — | (12,380 | ) | — | — | (12,380 | ) | |||||||||||||||
Net cash disbursed upon spin-off of Performance Fibers business | (106,420 | ) | — | — | — | — | (106,420 | ) | |||||||||||||||
Intercompany distributions | — | (149,525 | ) | — | 65,318 | 84,207 | — | ||||||||||||||||
Other | — | — | — | (680 | ) | — | (680 | ) | |||||||||||||||
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES | (229,535 | ) | (149,525 | ) | 118,947 | 64,638 | 84,207 | (111,268 | ) | ||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | — | (50 | ) | — | (50 | ) | |||||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||||||
Change in cash and cash equivalents | (91,000 | ) | 792 | 56,147 | 56,478 | — | 22,417 | ||||||||||||||||
Balance, beginning of year | 130,181 | 304 | 10,719 | 58,440 | — | 199,644 | |||||||||||||||||
Balance, end of period | $39,181 | $1,096 | $66,866 | $114,918 | — | $222,061 |
CONDENSED CONSOLIDATING STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME | |||||||||||||||||||
For the Three Months Ended June 30, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
SALES | — | — | $115,801 | — | $115,801 | ||||||||||||||
Costs and Expenses | |||||||||||||||||||
Cost of sales | — | — | 103,689 | — | 103,689 | ||||||||||||||
Selling and general expenses | — | 6,330 | 6,397 | — | 12,727 | ||||||||||||||
Other operating income, net | — | (461 | ) | (6,677 | ) | — | (7,138 | ) | |||||||||||
— | 5,869 | 103,409 | — | 109,278 | |||||||||||||||
OPERATING (LOSS) INCOME | — | (5,869 | ) | 12,392 | — | 6,523 | |||||||||||||
Interest expense | (3,169 | ) | (2,540 | ) | (2,774 | ) | — | (8,483 | ) | ||||||||||
Interest and miscellaneous income (expense), net | 1,871 | 680 | (3,747 | ) | — | (1,196 | ) | ||||||||||||
Equity in (loss) income from subsidiaries | (238 | ) | 6,564 | — | (6,326 | ) | — | ||||||||||||
(LOSS) INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | (1,536 | ) | (1,165 | ) | 5,871 | (6,326 | ) | (3,156 | ) | ||||||||||
Income tax benefit (expense) | — | 927 | (631 | ) | — | 296 | |||||||||||||
NET (LOSS) INCOME | (1,536 | ) | (238 | ) | 5,240 | (6,326 | ) | (2,860 | ) | ||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | (1,324 | ) | — | (1,324 | ) | ||||||||||||
NET (LOSS) INCOME ATTRIBUTABLE TO RAYONIER INC. | (1,536 | ) | (238 | ) | 6,564 | (6,326 | ) | (1,536 | ) | ||||||||||
OTHER COMPREHENSIVE LOSS | |||||||||||||||||||
Foreign currency translation adjustment | (18,008 | ) | (18,008 | ) | (25,395 | ) | 36,016 | (25,395 | ) | ||||||||||
New Zealand joint venture cash flow hedges | (1,896 | ) | (1,896 | ) | (2,917 | ) | 3,792 | (2,917 | ) | ||||||||||
Amortization of pension and postretirement plans, net of income tax | 743 | 743 | (5 | ) | (738 | ) | 743 | ||||||||||||
Total other comprehensive loss | (19,161 | ) | (19,161 | ) | (28,317 | ) | 39,070 | (27,569 | ) | ||||||||||
COMPREHENSIVE LOSS | (20,697 | ) | (19,399 | ) | (23,077 | ) | 32,744 | (30,429 | ) | ||||||||||
Less: Comprehensive loss attributable to noncontrolling interest | — | — | (9,730 | ) | (1 | ) | (9,731 | ) | |||||||||||
COMPREHENSIVE LOSS ATTRIBUTABLE TO RAYONIER INC. | ($20,697 | ) | ($19,399 | ) | ($13,347 | ) | $32,745 | ($20,698 | ) | ||||||||||
CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | |||||||||||||||||||
For the Three Months Ended June 30, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
SALES | — | — | $163,145 | — | $163,145 | ||||||||||||||
Costs and Expenses | |||||||||||||||||||
Cost of sales | — | — | 123,096 | — | 123,096 | ||||||||||||||
Selling and general expenses | — | 2,394 | 11,467 | — | 13,861 | ||||||||||||||
Other operating expense (income), net | — | 1,573 | (12,962 | ) | — | (11,389 | ) | ||||||||||||
— | 3,967 | 121,601 | — | 125,568 | |||||||||||||||
OPERATING (LOSS) INCOME | — | (3,967 | ) | 41,544 | — | 37,577 | |||||||||||||
Interest expense | (3,196 | ) | (11,207 | ) | (1,209 | ) | — | (15,612 | ) | ||||||||||
Interest and miscellaneous income (expense), net | 2,733 | (4,101 | ) | (3,017 | ) | — | (4,385 | ) | |||||||||||
Equity in income from subsidiaries | 16,814 | 31,220 | — | (48,034 | ) | — | |||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 16,351 | 11,945 | 37,318 | (48,034 | ) | 17,580 | |||||||||||||
Income tax benefit (expense) | — | 4,869 | (18,425 | ) | — | (13,556 | ) | ||||||||||||
INCOME FROM CONTINUING OPERATIONS | 16,351 | 16,814 | 18,893 | (48,034 | ) | 4,024 | |||||||||||||
DISCONTINUED OPERATIONS, NET | |||||||||||||||||||
Income from discontinued operations, net of income taxes | — | — | 12,084 | — | 12,084 | ||||||||||||||
NET INCOME | 16,351 | 16,814 | 30,977 | (48,034 | ) | 16,108 | |||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | (245 | ) | — | (245 | ) | ||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 16,351 | 16,814 | 31,222 | (48,034 | ) | 16,353 | |||||||||||||
OTHER COMPREHENSIVE INCOME | |||||||||||||||||||
Foreign currency translation adjustment | 2,653 | 2,655 | 3,517 | (5,308 | ) | 3,517 | |||||||||||||
New Zealand joint venture cash flow hedges | (598 | ) | (598 | ) | (920 | ) | 1,196 | (920 | ) | ||||||||||
Amortization of pension and postretirement plans, net of income tax | 58,873 | 58,873 | 92,714 | (151,587 | ) | 58,873 | |||||||||||||
Total other comprehensive income | 60,928 | 60,930 | 95,311 | (155,699 | ) | 61,470 | |||||||||||||
COMPREHENSIVE INCOME | 77,279 | 77,744 | 126,288 | (203,733 | ) | 77,578 | |||||||||||||
Less: Comprehensive income attributable to noncontrolling interest | — | — | 297 | — | 297 | ||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $77,279 | $77,744 | $125,991 | ($203,733 | ) | $77,281 | |||||||||||||
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | |||||||||||||||||||
For the Six Months Ended June 30, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
SALES | — | — | $256,106 | — | $256,106 | ||||||||||||||
Costs and Expenses | |||||||||||||||||||
Cost of sales | — | — | 210,923 | — | 210,923 | ||||||||||||||
Selling and general expenses | — | 11,279 | 12,347 | — | 23,626 | ||||||||||||||
Other operating income, net | — | (461 | ) | (12,252 | ) | — | (12,713 | ) | |||||||||||
— | 10,818 | 211,018 | — | 221,836 | |||||||||||||||
OPERATING (LOSS) INCOME | — | (10,818 | ) | 45,088 | — | 34,270 | |||||||||||||
Interest expense | (6,337 | ) | (5,064 | ) | (5,626 | ) | — | (17,027 | ) | ||||||||||
Interest and miscellaneous income (expense), net | 3,807 | 1,373 | (7,871 | ) | — | (2,691 | ) | ||||||||||||
Equity in income from subsidiaries | 18,741 | 31,363 | — | (50,104 | ) | — | |||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 16,211 | 16,854 | 31,591 | (50,104 | ) | 14,552 | |||||||||||||
Income tax benefit (expense) | — | 1,887 | (1,119 | ) | — | 768 | |||||||||||||
NET INCOME | 16,211 | 18,741 | 30,472 | (50,104 | ) | 15,320 | |||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | (891 | ) | — | (891 | ) | ||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 16,211 | 18,741 | 31,363 | (50,104 | ) | 16,211 | |||||||||||||
OTHER COMPREHENSIVE LOSS | |||||||||||||||||||
Foreign currency translation adjustment | (28,438 | ) | (28,438 | ) | (39,718 | ) | 56,877 | (39,717 | ) | ||||||||||
New Zealand joint venture cash flow hedges | (2,511 | ) | (2,511 | ) | (3,863 | ) | 5,022 | (3,863 | ) | ||||||||||
Amortization of pension and postretirement plans, net of income tax | 1,524 | 1,524 | 15 | (1,539 | ) | 1,524 | |||||||||||||
Total other comprehensive loss | (29,425 | ) | (29,425 | ) | (43,566 | ) | 60,360 | (42,056 | ) | ||||||||||
COMPREHENSIVE LOSS | (13,214 | ) | (10,684 | ) | (13,094 | ) | 10,256 | (26,736 | ) | ||||||||||
Less: Comprehensive loss attributable to noncontrolling interest | — | — | (13,522 | ) | — | (13,522 | ) | ||||||||||||
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO RAYONIER INC. | ($13,214 | ) | ($10,684 | ) | $428 | $10,256 | ($13,214 | ) | |||||||||||
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | |||||||||||||||||||
For the Six Months Ended June 30, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
SALES | — | — | $306,332 | — | $306,332 | ||||||||||||||
Costs and Expenses | |||||||||||||||||||
Cost of sales | — | — | 238,995 | — | 238,995 | ||||||||||||||
Selling and general expenses | — | 4,544 | 22,554 | — | 27,098 | ||||||||||||||
Other operating expense (income), net | — | 3,948 | (15,712 | ) | — | (11,764 | ) | ||||||||||||
— | 8,492 | 245,837 | — | 254,329 | |||||||||||||||
OPERATING (LOSS) INCOME | — | (8,492 | ) | 60,495 | — | 52,003 | |||||||||||||
Interest expense | (6,389 | ) | (18,140 | ) | (1,757 | ) | — | (26,286 | ) | ||||||||||
Interest and miscellaneous income (expense), net | 5,431 | (4,334 | ) | (6,494 | ) | — | (5,397 | ) | |||||||||||
Equity in income from subsidiaries | 58,737 | 82,633 | — | (141,370 | ) | — | |||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 57,779 | 51,667 | 52,244 | (141,370 | ) | 20,320 | |||||||||||||
Income tax benefit (expense) | — | 7,070 | (13,031 | ) | — | (5,961 | ) | ||||||||||||
INCOME FROM CONTINUING OPERATIONS | 57,779 | 58,737 | 39,213 | (141,370 | ) | 14,359 | |||||||||||||
DISCONTINUED OPERATIONS, NET | |||||||||||||||||||
Income from discontinued operations, net of income tax | — | — | 43,092 | — | 43,092 | ||||||||||||||
NET INCOME | 57,779 | 58,737 | 82,305 | (141,370 | ) | 57,451 | |||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | (328 | ) | — | (328 | ) | ||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 57,779 | 58,737 | 82,633 | (141,370 | ) | 57,779 | |||||||||||||
OTHER COMPREHENSIVE INCOME | |||||||||||||||||||
Foreign currency translation adjustment | 15,547 | 15,547 | 21,312 | (31,086 | ) | 21,320 | |||||||||||||
New Zealand joint venture cash flow hedges | 514 | 514 | 791 | (1,028 | ) | 791 | |||||||||||||
Amortization of pension and postretirement plans, net of income tax | 60,970 | 60,970 | 94,334 | (155,304 | ) | 60,970 | |||||||||||||
Total other comprehensive income | 77,031 | 77,031 | 116,437 | (187,418 | ) | 83,081 | |||||||||||||
COMPREHENSIVE INCOME | 134,810 | 135,768 | 198,742 | (328,788 | ) | 140,532 | |||||||||||||
Less: Comprehensive income attributable to noncontrolling interest | — | — | 5,722 | — | 5,722 | ||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $134,810 | $135,768 | $193,020 | ($328,788 | ) | $134,810 | |||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEETS | |||||||||||||||||||
As of June 30, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
ASSETS | |||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||
Cash and cash equivalents | $5,366 | $45,941 | $40,325 | — | $91,632 | ||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | 91 | 19,353 | — | 19,444 | ||||||||||||||
Inventory | — | — | 13,362 | — | 13,362 | ||||||||||||||
Prepaid and other current assets | — | 4,863 | 16,359 | — | 21,222 | ||||||||||||||
Total current assets | 5,366 | 50,895 | 89,399 | — | 145,660 | ||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | 2,086,729 | — | 2,086,729 | ||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | 69,726 | — | 69,726 | ||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 480 | 5,954 | — | 6,434 | ||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,516,408 | 2,268,652 | — | (3,785,060 | ) | — | |||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 252,815 | 21,928 | — | (274,743 | ) | — | |||||||||||||
OTHER ASSETS | 2,570 | 17,801 | 37,401 | — | 57,772 | ||||||||||||||
TOTAL ASSETS | $1,777,159 | $2,359,756 | $2,289,209 | ($4,059,803 | ) | $2,366,321 | |||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||
Accounts payable | — | $3,517 | $18,879 | — | $22,396 | ||||||||||||||
Current maturities of long-term debt | — | 30,000 | — | — | 30,000 | ||||||||||||||
Accrued taxes | — | 14 | 15,797 | — | 15,811 | ||||||||||||||
Accrued payroll and benefits | — | 2,476 | 2,120 | — | 4,596 | ||||||||||||||
Accrued interest | 3,046 | 2,493 | 35,499 | (32,995 | ) | 8,043 | |||||||||||||
Other current liabilities | — | 11,990 | 19,624 | — | 31,614 | ||||||||||||||
Total current liabilities | 3,046 | 50,490 | 91,919 | (32,995 | ) | 112,460 | |||||||||||||
LONG-TERM DEBT | 370,000 | 115,972 | 236,381 | — | 722,353 | ||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,081 | (685 | ) | — | 33,396 | |||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,615 | 14,225 | — | 20,840 | ||||||||||||||
INTERCOMPANY PAYABLE | — | 636,190 | (254,315 | ) | (381,875 | ) | — | ||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,404,113 | 1,516,408 | 2,128,525 | (3,644,933 | ) | 1,404,113 | |||||||||||||
Noncontrolling interest | — | — | 73,159 | — | 73,159 | ||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,404,113 | 1,516,408 | 2,201,684 | (3,644,933 | ) | 1,477,272 | |||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,777,159 | $2,359,756 | $2,289,209 | ($4,059,803 | ) | $2,366,321 |
CONDENSED CONSOLIDATING BALANCE SHEETS | |||||||||||||||||||
As of December 31, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
ASSETS | |||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||
Cash and cash equivalents | $102,218 | $8,105 | $51,235 | — | $161,558 | ||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | 1,409 | 22,609 | — | 24,018 | ||||||||||||||
Inventory | — | — | 8,383 | — | 8,383 | ||||||||||||||
Prepaid and other current assets | — | 2,009 | 17,736 | — | 19,745 | ||||||||||||||
Total current assets | 102,218 | 11,523 | 99,963 | — | 213,704 | ||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | 2,088,501 | — | 2,088,501 | ||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | 77,433 | — | 77,433 | ||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 433 | 6,273 | — | 6,706 | ||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,463,303 | 2,053,911 | — | (3,517,214 | ) | — | |||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 248,233 | 21,500 | — | (269,733 | ) | — | |||||||||||||
OTHER ASSETS | 2,763 | 18,369 | 45,639 | — | 66,771 | ||||||||||||||
TOTAL ASSETS | $1,816,517 | $2,105,736 | $2,317,809 | ($3,786,947 | ) | $2,453,115 | |||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||
Accounts payable | — | $2,810 | $17,401 | — | $20,211 | ||||||||||||||
Current maturities of long-term debt | — | 129,706 | — | — | 129,706 | ||||||||||||||
Accrued taxes | — | 11 | 11,394 | — | 11,405 | ||||||||||||||
Accrued payroll and benefits | — | 3,253 | 3,137 | — | 6,390 | ||||||||||||||
Accrued interest | 3,047 | 2,517 | 31,281 | (28,412 | ) | 8,433 | |||||||||||||
Other current liabilities | — | 1,073 | 24,784 | — | 25,857 | ||||||||||||||
Total current liabilities | 3,047 | 139,370 | 87,997 | (28,412 | ) | 202,002 | |||||||||||||
LONG-TERM DEBT | 325,000 | 31,000 | 265,849 | — | 621,849 | ||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,161 | (684 | ) | — | 33,477 | |||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,436 | 14,200 | — | 20,636 | ||||||||||||||
INTERCOMPANY PAYABLE | — | 431,466 | (153,754 | ) | (277,712 | ) | — | ||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 2,017,520 | (3,480,823 | ) | 1,488,470 | |||||||||||||
Noncontrolling interest | — | — | 86,681 | — | 86,681 | ||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 2,104,201 | (3,480,823 | ) | 1,575,151 | |||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,816,517 | $2,105,736 | $2,317,809 | ($3,786,947 | ) | $2,453,115 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | |||||||||||||||||||
For the Six Months Ended June 30, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
CASH (USED FOR) PROVIDED BY OPERATING ACTIVITIES | ($25,092 | ) | ($13,561 | ) | $110,401 | $14,135 | $85,883 | ||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||
Capital expenditures | — | (134 | ) | (25,996 | ) | — | (26,130 | ) | |||||||||||
Real estate development costs | — | — | (578 | ) | — | (578 | ) | ||||||||||||
Purchase of timberlands | — | — | (88,414 | ) | — | (88,414 | ) | ||||||||||||
Change in restricted cash | — | — | 4,160 | — | 4,160 | ||||||||||||||
Investment in Subsidiaries | — | 8,753 | — | (8,753 | ) | — | |||||||||||||
Other | — | — | 3,689 | — | 3,689 | ||||||||||||||
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES | — | 8,619 | (107,139 | ) | (8,753 | ) | (107,273 | ) | |||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||
Issuance of debt | — | 57,000 | 2,100 | — | 59,100 | ||||||||||||||
Repayment of debt | — | (28,000 | ) | (3,472 | ) | — | (31,472 | ) | |||||||||||
Dividends paid | (63,421 | ) | — | — | — | (63,421 | ) | ||||||||||||
Proceeds from the issuance of common shares | 718 | — | — | — | 718 | ||||||||||||||
Repurchase of common shares | (9,057 | ) | — | — | — | (9,057 | ) | ||||||||||||
Intercompany distributions | — | 13,778 | (8,396 | ) | (5,382 | ) | — | ||||||||||||
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES | (71,760 | ) | 42,778 | (9,768 | ) | (5,382 | ) | (44,132 | ) | ||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | (4,404 | ) | — | (4,404 | ) | ||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||
Change in cash and cash equivalents | (96,852 | ) | 37,836 | (10,910 | ) | — | (69,926 | ) | |||||||||||
Balance, beginning of year | 102,218 | 8,105 | 51,235 | — | 161,558 | ||||||||||||||
Balance, end of period | $5,366 | $45,941 | $40,325 | — | $91,632 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | |||||||||||||||||||
For the Six Months Ended June 30, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
CASH PROVIDED BY OPERATING ACTIVITIES | $138,535 | $150,518 | $87,098 | ($147,007 | ) | $229,144 | |||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||
Capital expenditures | — | (201 | ) | (33,396 | ) | — | (33,597 | ) | |||||||||||
Capital expenditures from discontinued operations | — | — | (47,050 | ) | — | (47,050 | ) | ||||||||||||
Real estate development costs | — | — | (2,595 | ) | — | (2,595 | ) | ||||||||||||
Purchase of timberlands | — | — | (74,817 | ) | — | (74,817 | ) | ||||||||||||
Change in restricted cash | — | — | 63,128 | — | 63,128 | ||||||||||||||
Investment in Subsidiaries | — | (62,800 | ) | — | 62,800 | — | |||||||||||||
Other | — | — | (478 | ) | — | (478 | ) | ||||||||||||
CASH USED FOR INVESTING ACTIVITIES | — | (63,001 | ) | (95,208 | ) | 62,800 | (95,409 | ) | |||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||
Issuance of debt | — | 1,238,389 | — | — | 1,238,389 | ||||||||||||||
Repayment of debt | — | (1,107,062 | ) | — | — | (1,107,062 | ) | ||||||||||||
Dividends paid | (124,628 | ) | — | — | — | (124,628 | ) | ||||||||||||
Proceeds from the issuance of common shares | 3,347 | — | — | — | 3,347 | ||||||||||||||
Repurchase of common shares | (1,834 | ) | — | — | — | (1,834 | ) | ||||||||||||
Debt issuance costs | — | (12,380 | ) | — | — | (12,380 | ) | ||||||||||||
Net cash disbursed upon spin-off of Performance Fibers business | (106,420 | ) | — | — | — | (106,420 | ) | ||||||||||||
Intercompany distributions | — | (149,525 | ) | 65,318 | 84,207 | — | |||||||||||||
Other | — | — | (680 | ) | — | (680 | ) | ||||||||||||
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES | (229,535 | ) | (30,578 | ) | 64,638 | 84,207 | (111,268 | ) | |||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | (50 | ) | — | (50 | ) | ||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||
Change in cash and cash equivalents | (91,000 | ) | 56,939 | 56,478 | — | 22,417 | |||||||||||||
Balance, beginning of year | 130,181 | 11,023 | 58,440 | — | 199,644 | ||||||||||||||
Balance, end of period | $39,181 | $67,962 | $114,918 | — | $222,061 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
(acres in 000s) | As of June 30, 2015 | As of December 31, 2014 | |||||||||||||||
Owned | Leased | Total | Owned | Leased | Total | ||||||||||||
Southern | |||||||||||||||||
Alabama | 308 | 24 | 332 | 309 | 24 | 333 | |||||||||||
Arkansas | — | 18 | 18 | — | 18 | 18 | |||||||||||
Florida | 284 | 94 | 378 | 281 | 105 | 386 | |||||||||||
Georgia | 573 | 123 | 696 | 575 | 125 | 700 | |||||||||||
Louisiana | 149 | 1 | 150 | 126 | 1 | 127 | |||||||||||
Mississippi | 91 | — | 91 | 91 | — | 91 | |||||||||||
Oklahoma | 92 | — | 92 | 92 | — | 92 | |||||||||||
Tennessee | 1 | — | 1 | 1 | — | 1 | |||||||||||
Texas | 157 | — | 157 | 158 | — | 158 | |||||||||||
1,655 | 260 | 1,915 | 1,633 | 273 | 1,906 | ||||||||||||
Pacific Northwest | |||||||||||||||||
Oregon | 6 | — | 6 | — | — | — | |||||||||||
Washington | 366 | 1 | 367 | 371 | 1 | 372 | |||||||||||
372 | 1 | 373 | 371 | 1 | 372 | ||||||||||||
New Zealand (a) | 185 | 259 | 444 | 185 | 266 | 451 | |||||||||||
Total | 2,212 | 520 | 2,732 | 2,189 | 540 | 2,729 |
(a) | Represents legal acres owned and leased by the New Zealand JV, in which Rayonier owns a 65 percent interest. As of June 30, 2015, legal acres in New Zealand were comprised of 303,000 plantable acres and 142,000 non-productive acres. |
(acres in 000s) | Acres Owned | |||||||||||||
December 31, 2014 | Acquisitions | Sales | Other | June 30, 2015 | ||||||||||
Southern | ||||||||||||||
Alabama | 309 | — | (1 | ) | — | 308 | ||||||||
Florida | 281 | 3 | — | — | 284 | |||||||||
Georgia | 575 | 1 | (3 | ) | — | 573 | ||||||||
Louisiana | 126 | 24 | (1 | ) | — | 149 | ||||||||
Mississippi | 91 | — | — | — | 91 | |||||||||
Oklahoma | 92 | — | — | — | 92 | |||||||||
Tennessee | 1 | — | — | — | 1 | |||||||||
Texas | 158 | — | (1 | ) | — | 157 | ||||||||
1,633 | 28 | (6 | ) | — | 1,655 | |||||||||
Pacific Northwest | ||||||||||||||
Oregon | — | 6 | — | — | 6 | |||||||||
Washington | 371 | — | (5 | ) | — | 366 | ||||||||
371 | 6 | (5 | ) | — | 372 | |||||||||
New Zealand (a) | 185 | — | — | — | 185 | |||||||||
Total | 2,189 | 34 | (11 | ) | — | 2,212 |
(a) | Represents legal acres owned by the New Zealand JV, in which Rayonier has a 65 percent interest. |
(acres in 000s) | Acres Leased | ||||||||||
December 31, 2014 | Expired Leases (a) | Other (b) | June 30, 2015 | ||||||||
Southern | |||||||||||
Alabama | 24 | — | — | 24 | |||||||
Arkansas | 18 | — | — | 18 | |||||||
Florida | 105 | (11 | ) | — | 94 | ||||||
Georgia | 125 | (2 | ) | — | 123 | ||||||
Louisiana | 1 | — | — | 1 | |||||||
273 | (13 | ) | — | 260 | |||||||
Pacific Northwest | |||||||||||
Washington | 1 | — | — | 1 | |||||||
New Zealand (c) | 266 | (1 | ) | (6 | ) | 259 | |||||
Total | 540 | (14 | ) | (6 | ) | 520 |
(a) | Includes acres previously under lease that have been harvested or sold. |
(b) | Includes activity for the purchase of leased acres and changes in classification between owned and leased acres. |
(c) | Represents legal acres leased by the New Zealand JV, in which Rayonier has a 65 percent interest. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Financial Information (in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Sales | |||||||||||||||
Southern Timber | $32.7 | $31.5 | $68.2 | $65.4 | |||||||||||
Pacific Northwest Timber | 17.1 | 25.1 | 36.3 | 58.1 | |||||||||||
New Zealand Timber | 39.2 | 44.4 | 80.4 | 82.3 | |||||||||||
Real Estate | |||||||||||||||
Improved Development | 0.8 | — | 0.8 | — | |||||||||||
Unimproved Development | 0.8 | 1.4 | 5.6 | 1.6 | |||||||||||
Rural | 3.3 | 5.4 | 10.1 | 10.5 | |||||||||||
Non-Strategic / Timberlands | 2.0 | 27.2 | 14.2 | 27.4 | |||||||||||
Total Real Estate | 6.9 | 34.0 | 30.7 | 39.5 | |||||||||||
Trading | 19.8 | 29.2 | 40.5 | 64.9 | |||||||||||
Intersegment Eliminations | 0.1 | ($1.1 | ) | — | (3.9 | ) | |||||||||
Total Sales | $115.8 | $163.1 | $256.1 | $306.3 | |||||||||||
Operating Income | |||||||||||||||
Southern Timber | $11.8 | $8.9 | $24.2 | $19.4 | |||||||||||
Pacific Northwest Timber | 1.7 | 8.8 | 4.3 | 21.4 | |||||||||||
New Zealand Timber | (0.9 | ) | 2.2 | 4.8 | 4.6 | ||||||||||
Real Estate | 1.4 | 27.8 | 14.0 | 28.5 | |||||||||||
Trading | (0.1 | ) | (0.1 | ) | 0.2 | (0.5 | ) | ||||||||
Corporate and other | (7.4 | ) | (10.0 | ) | (13.2 | ) | (21.4 | ) | |||||||
Operating Income | 6.5 | 37.6 | 34.3 | 52.0 | |||||||||||
Interest Expense, Interest Income and Other | (9.7 | ) | (20.0 | ) | (19.7 | ) | (31.7 | ) | |||||||
Income Tax Benefit (Expense) | 0.3 | (13.6 | ) | 0.7 | (5.9 | ) | |||||||||
(Loss) Income from Continuing Operations | (2.9 | ) | 4.0 | 15.3 | 14.4 | ||||||||||
Discontinued Operations, Net | — | 12.1 | — | 43.1 | |||||||||||
Net (Loss) Income | (2.9 | ) | 16.1 | 15.3 | 57.5 | ||||||||||
Less: Net (loss) income attributable to noncontrolling interest | (1.4 | ) | (0.3 | ) | (0.9 | ) | (0.3 | ) | |||||||
Net (Loss) Income Attributable to Rayonier Inc. | ($1.5 | ) | $16.4 | $16.2 | $57.8 | ||||||||||
Adjusted EBITDA (a) | |||||||||||||||
Southern Timber | $24.4 | $19.6 | $51.2 | $42.1 | |||||||||||
Pacific Northwest Timber | 4.6 | 14.0 | 11.0 | 32.9 | |||||||||||
New Zealand Timber | 6.2 | 9.9 | 19.9 | 20.9 | |||||||||||
Real Estate | 3.6 | 36.5 | 23.8 | 39.1 | |||||||||||
Trading | (0.1 | ) | (0.1 | ) | 0.2 | (0.5 | ) | ||||||||
Corporate and Other | (5.6 | ) | (9.7 | ) | (11.5 | ) | (20.8 | ) | |||||||
Total Adjusted EBITDA (a) | $33.1 | $70.2 | $94.6 | $113.7 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Southern Timber Overview | 2015 | 2014 | 2015 | 2014 | |||||||||||
Sales Volume (in thousands of tons) | |||||||||||||||
Pine Pulpwood | 845 | 707 | 1,750 | 1,483 | |||||||||||
Pine Sawtimber | 375 | 363 | 793 | 750 | |||||||||||
Total Pine Volume | 1,220 | 1,070 | 2,543 | 2,233 | |||||||||||
Hardwood | 74 | 79 | 121 | 190 | |||||||||||
Total Volume | 1,294 | 1,149 | 2,664 | 2,423 | |||||||||||
Percentage Delivered Sales | 25 | % | 36 | % | 25 | % | 33 | % | |||||||
Percentage Stumpage Sales | 75 | % | 64 | % | 75 | % | 67 | % | |||||||
Net Stumpage Pricing (dollars per ton) | |||||||||||||||
Pine Pulpwood | $19.10 | $18.94 | $18.96 | $18.74 | |||||||||||
Pine Sawtimber | 27.33 | 26.16 | 28.13 | 26.63 | |||||||||||
Weighted Average Pine | $21.63 | $21.39 | $21.94 | $21.55 | |||||||||||
Hardwood | 11.33 | 11.58 | 11.79 | 12.91 | |||||||||||
Weighted Average Total | $21.03 | $20.71 | $21.37 | $20.71 | |||||||||||
Summary Financial Data (in millions of dollars) | |||||||||||||||
Sales | $32.7 | $31.5 | $68.2 | $65.40 | |||||||||||
Less: Cut and Haul | (5.5 | ) | (7.7 | ) | (11.3 | ) | (15.2 | ) | |||||||
Net Stumpage Sales | $27.2 | $23.8 | $56.9 | $50.2 | |||||||||||
Operating Income | $11.8 | $8.9 | $24.2 | $19.4 | |||||||||||
Adjusted EBITDA (a) | $24.4 | $19.6 | $51.2 | $42.1 | |||||||||||
Other Data | |||||||||||||||
Non-Timber Income (in millions of dollars) | $4.4 | $2.4 | $8.0 | $4.5 | |||||||||||
Period-End Acres (in thousands) | 1,915 | 1,901 | 1,915 | 1,901 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Sales (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $31.5 | $65.4 | |||||
Changes Attributable to: | |||||||
Volume/Mix | 1.3 | 2.3 | |||||
Price | (0.1 | ) | 0.5 | ||||
June 30, 2015 | $32.7 | $68.2 |
Operating Income (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $8.9 | $19.4 | |||||
Changes Attributable to: | |||||||
Volume/Mix | 1.9 | 3.2 | |||||
Price | 0.1 | 0.9 | |||||
Cost | (0.5 | ) | (1.0 | ) | |||
Non-timber income | 1.9 | 3.4 | |||||
Depreciation, depletion and amortization | (0.6 | ) | (1.7 | ) | |||
Other | 0.1 | — | |||||
June 30, 2015 | $11.8 | $24.2 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $19.6 | $42.1 | |||||
Changes Attributable to: | |||||||
Volume/Mix | 3.3 | 5.8 | |||||
Price | 0.1 | 0.9 | |||||
Cost | (0.5 | ) | (1.0 | ) | |||
Non-timber income | 1.9 | 3.4 | |||||
Other | — | — | |||||
June 30, 2015 | $24.4 | $51.2 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Pacific Northwest Timber Overview | 2015 | 2014 | 2015 | 2014 | |||||||||||
Sales Volume (in thousands of tons) | |||||||||||||||
Pulpwood | 63 | 73 | 118 | 158 | |||||||||||
Sawtimber | 187 | 375 | 457 | 833 | |||||||||||
Total Volume | 250 | 448 | 575 | 991 | |||||||||||
Sales Volume (converted to MBF) | |||||||||||||||
Pulpwood | 5,985 | 6,860 | 11,125 | 14,971 | |||||||||||
Sawtimber | 25,180 | 49,093 | 58,635 | 103,663 | |||||||||||
Total Volume | 31,165 | 55,953 | 69,760 | 118,634 | |||||||||||
Percentage Delivered Sales | 100 | % | 41 | % | 88 | % | 44 | % | |||||||
Percentage Stumpage Sales | — | 59 | % | 12 | % | 56 | % | ||||||||
Delivered Log Pricing (in dollars per ton) | |||||||||||||||
Pulpwood | $43.37 | $37.10 | $43.29 | $37.55 | |||||||||||
Sawtimber | 76.80 | 84.46 | 73.98 | 83.05 | |||||||||||
Weighted Average Log Price | $68.36 | $74.51 | $67.63 | $74.21 | |||||||||||
Summary Financial Data (in millions of dollars) | |||||||||||||||
Sales | $17.1 | $25.1 | $36.3 | $58.1 | |||||||||||
Less: Cut and Haul | (8.6 | ) | (5.9 | ) | (16.7 | ) | (14.2 | ) | |||||||
Net Stumpage Sales | $8.5 | $19.2 | $19.6 | $43.9 | |||||||||||
Operating Income | $1.7 | $8.8 | $4.3 | $21.4 | |||||||||||
Adjusted EBITDA (a) | $4.6 | $14.0 | $11.0 | $32.9 | |||||||||||
Other Data | |||||||||||||||
Non-Timber Income (in millions of dollars) | $1.0 | $0.5 | $1.7 | $0.7 | |||||||||||
Period-End Acres (in thousands) | 373 | 372 | 373 | 372 | |||||||||||
Sawtimber (in dollars per MBF) | $571 | $629 | $590 | $659 | |||||||||||
Estimated Percentage of Export Volume | 26 | % | 21 | % | 22 | % | 24 | % |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Sales (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $25.1 | $58.1 | |||||
Changes Attributable to: | |||||||
Volume/Mix | (6.4 | ) | (17.4 | ) | |||
Price | (1.5 | ) | (4.5 | ) | |||
Other | (0.1 | ) | 0.1 | ||||
June 30, 2015 | $17.1 | $36.3 |
Operating Income (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $8.8 | $21.4 | |||||
Changes Attributable to: | |||||||
Volume/Mix | (5.5 | ) | (13.0 | ) | |||
Price | (2.0 | ) | (4.6 | ) | |||
Cost | — | (0.4 | ) | ||||
Non-timber income | 0.5 | 1.0 | |||||
Other | (0.1 | ) | (0.1 | ) | |||
June 30, 2015 | $1.7 | $4.3 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $14.0 | $32.9 | |||||
Changes Attributable to: | |||||||
Volume/Mix | (7.7 | ) | (17.8 | ) | |||
Price | (2.0 | ) | (4.6 | ) | |||
Cost | — | (0.4 | ) | ||||
Non-timber income | 0.5 | 1.0 | |||||
Other | (0.2 | ) | (0.1 | ) | |||
June 30, 2015 | $4.6 | $11.0 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
New Zealand Timber Overview | 2015 | 2014 | 2015 | 2014 | |||||||||||
Sales Volume (in thousands of tons) | |||||||||||||||
Domestic Sawtimber (Delivered) | 169 | 170 | 319 | 314 | |||||||||||
Domestic Pulpwood (Delivered) | 110 | 77 | 210 | 150 | |||||||||||
Export Sawtimber (Delivered) | 248 | 193 | 449 | 335 | |||||||||||
Export Pulpwood (Delivered) | 21 | 16 | 32 | 25 | |||||||||||
Stumpage | 35 | 67 | 111 | 158 | |||||||||||
Total Volume | 583 | 523 | 1,121 | 982 | |||||||||||
Percentage Delivered Sales | 94 | % | 87 | % | 90 | % | 84 | % | |||||||
Percentage Stumpage Sales | 6 | % | 13 | % | 10 | % | 16 | % | |||||||
Delivered Log Pricing (in dollars per ton) | |||||||||||||||
Domestic Sawtimber | $66.96 | $84.64 | $68.76 | $82.53 | |||||||||||
Domestic Pulpwood | $33.59 | $39.52 | $34.45 | $38.94 | |||||||||||
Export Sawtimber | $85.31 | $118.12 | $93.21 | $119.15 | |||||||||||
Summary Financial Data (in millions of dollars) | |||||||||||||||
Sales | $38.4 | $44.1 | $76.2 | $79.9 | |||||||||||
Less: Cut and Haul | (19.2 | ) | (20.3 | ) | (35.2 | ) | (36.2 | ) | |||||||
Less: Port and Freight Costs | (8.1 | ) | (9.0 | ) | (14.7 | ) | (14.6 | ) | |||||||
Net Stumpage Sales | $11.1 | $14.8 | $26.3 | $29.1 | |||||||||||
Land Sales | 0.8 | 0.3 | 4.2 | 2.4 | |||||||||||
Total Sales | $39.2 | $44.4 | $80.4 | $82.3 | |||||||||||
Operating (Loss) Income | ($0.9 | ) | $2.2 | $4.8 | $4.6 | ||||||||||
Adjusted EBITDA (a) | $6.2 | $9.9 | $19.9 | $20.9 | |||||||||||
Other Data | |||||||||||||||
New Zealand Dollar to U.S. Dollar Exchange Rate (b) | 0.7398 | 0.8575 | 0.7477 | 0.8414 | |||||||||||
Net Plantable Period-End Acres (in thousands) | 303 | 313 | 303 | 313 | |||||||||||
Export Sawtimber (in dollars per JAS m3) | $99.84 | $137.05 | $108.90 | $138.27 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
(b) | Represents the average period rate. |
Sales (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $44.4 | $82.3 | |||||
Changes Attributable to: | |||||||
Volume/Mix | 5.2 | 12.1 | |||||
Price | (10.4 | ) | (14.8 | ) | |||
Other | — | 0.8 | |||||
June 30, 2015 | $39.2 | $80.4 |
Operating (Loss) Income (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $2.2 | $4.6 | |||||
Changes Attributable to: | |||||||
Volume/Mix | (0.4 | ) | 0.6 | ||||
Price | (3.9 | ) | (4.8 | ) | |||
Cost | 1.4 | 2.2 | |||||
Non-timber income (a) | 1.1 | 2.6 | |||||
Foreign exchange | (2.0 | ) | (2.0 | ) | |||
Depreciation, depletion and amortization | 1.7 | 2.9 | |||||
Non-cash cost of land and real estate development costs recovered upon sale | — | 2.1 | |||||
Other (b) | (1.0 | ) | (3.4 | ) | |||
June 30, 2015 | ($0.9) | $4.8 |
(a) | Three and six months include $0.4 million and $1.8 million, respectively, primarily related to timber sold in conjunction with the relinquishment of a forestry right and $0.6 million related to the sale of carbon credits. |
(b) | Three and six months include $0.6 million and $2.4 million, respectively, of cost basis of timber sold in conjunction with the relinquishment of a forestry right. |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $9.9 | $20.9 | |||||
Changes Attributable to: | |||||||
Volume/Mix | 0.2 | 2.1 | |||||
Price | (3.9 | ) | (4.8 | ) | |||
Cost | 1.4 | 2.2 | |||||
Non-timber income | 1.1 | 2.6 | |||||
Foreign exchange | (2.0 | ) | (2.0 | ) | |||
Other | (0.5 | ) | (1.1 | ) | |||
June 30, 2015 | $6.2 | $19.9 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
Timber Segments Selected Operating Information | 2015 | 2014 | 2015 | 2014 | |||||||||||
Depreciation, Depletion and Amortization (in millions of dollars) | |||||||||||||||
Southern Timber | $12.6 | $10.7 | $27.0 | $22.7 | |||||||||||
Pacific Northwest Timber | 2.9 | 5.2 | 6.7 | 11.5 | |||||||||||
New Zealand Timber | 7.1 | 7.7 | 15.1 | 14.2 | |||||||||||
Total | $22.6 | $23.6 | $48.8 | $48.4 | |||||||||||
Timber Capital Expenditures (in millions of dollars) | |||||||||||||||
U.S. Timber | |||||||||||||||
Reforestation, silvicultural and other capital expenditures | 4.8 | 5.5 | 9.5 | 11.0 | |||||||||||
Property taxes | 1.9 | 1.6 | 3.8 | 3.7 | |||||||||||
Lease payments | 0.8 | 0.9 | 3.1 | 3.5 | |||||||||||
Allocated overhead | 1.3 | 1.6 | 2.7 | 3.2 | |||||||||||
Timberland acquisitions | 65.3 | 62.0 | 88.4 | 72.7 | |||||||||||
Subtotal U.S. Timber | $74.1 | $71.6 | $107.5 | $94.1 | |||||||||||
New Zealand Timber | |||||||||||||||
Reforestation, silvicultural and other capital expenditures | 1.6 | 2.9 | 3.1 | 4.7 | |||||||||||
Property taxes | 0.1 | 0.2 | 0.3 | 0.4 | |||||||||||
Lease payments | 1.0 | 1.6 | 1.5 | 1.9 | |||||||||||
Allocated overhead | 0.5 | 0.8 | 1.2 | 1.6 | |||||||||||
Timberland acquisitions | — | — | — | 2.1 | |||||||||||
Subtotal New Zealand Timber | $3.2 | $5.5 | $6.1 | $10.7 | |||||||||||
Total Timber Segments Capital Expenditures | $77.3 | $77.1 | $113.6 | $104.8 |
Three Months Ended June 31, | Six Months Ended June 30, | ||||||||||||||
Real Estate Overview | 2015 | 2014 | 2015 | 2014 | |||||||||||
Sales (in millions of dollars) | |||||||||||||||
Improved Development (a) | 0.8 | — | 0.8 | — | |||||||||||
Unimproved Development | 0.8 | 1.4 | 5.6 | 1.6 | |||||||||||
Rural (b) | 3.3 | 5.4 | 10.1 | 10.5 | |||||||||||
Non-Strategic / Timberlands (b) | 2.0 | 27.2 | 14.2 | 27.4 | |||||||||||
Total Sales | $6.9 | $34.0 | $30.7 | $39.5 | |||||||||||
Sales (Development and Rural Only) (c) | $4.1 | $6.8 | $15.7 | $12.1 | |||||||||||
Acres Sold | |||||||||||||||
Improved Development (a) | 19 | — | 19 | — | |||||||||||
Unimproved Development | 86 | 68 | 495 | 95 | |||||||||||
Rural (b) | 1,393 | 2,030 | 4,270 | 3,763 | |||||||||||
Non-Strategic / Timberlands (b) | 839 | 23,185 | 4,950 | 23,547 | |||||||||||
Total Acres Sold | 2,337 | 25,283 | 9,734 | 27,405 | |||||||||||
Acre Sold (Development and Rural Only) (c) | 1,479 | 2,098 | 4,765 | 3,858 | |||||||||||
Percentage of U.S. South acreage sold (d) | 0.1 | % | 0.1 | % | 0.3 | % | 0.2 | % | |||||||
Price per Acre (dollars per acre) | |||||||||||||||
Improved Development (a) | $42,281 | — | $42,281 | — | |||||||||||
Unimproved Development | 8,908 | 20,897 | 11,282 | 16,450 | |||||||||||
Rural (b) | 2,377 | 2,654 | 2,371 | 2,794 | |||||||||||
Non-Strategic / Timberlands (b) | 2,440 | 1,174 | 2,870 | 1,167 | |||||||||||
Weighted Average (Total) | $2,971 | $1,345 | $3,157 | $1,443 | |||||||||||
Weighted Average (Development and Rural) (c) | $2,757 | $3,245 | $3,297 | $3,136 |
(a) | Reflects land with capital invested in infrastructure improvements. |
(b) | Conservation sales previously reported as Rural are now reported with Non-Strategic / Timberlands. |
(c) | Excludes Improved Development. |
(d) | Calculated as Southern development and rural acres sold over U.S. South acres owned. |
Sales (in millions of dollars) | Three Months Ended | Six Months Ended | ||||||
June 30, 2014 | $34.0 | $39.5 | ||||||
Changes Attributable to: | ||||||||
Volume/Mix | (30.9 | ) | (25.5 | ) | ||||
Price | 3.8 | 16.7 | ||||||
June 30, 2015 | $6.9 | $30.7 |
Operating Income (in millions of dollars) | Three Months Ended | Six Months Ended | ||||||
June 30, 2014 | $27.8 | $28.5 | ||||||
Changes Attributable to: | ||||||||
Volume/Mix | (22.3 | ) | (18.0 | ) | ||||
Price | 3.8 | 16.7 | ||||||
Cost | (0.8 | ) | (1.5 | ) | ||||
Depreciation, depletion and amortization | (0.3 | ) | (2.1 | ) | ||||
Non-cash cost of land and real estate development costs recovered upon sale | (1.0 | ) | (3.8 | ) | ||||
Other (a) | (5.8 | ) | (5.8 | ) | ||||
June 30, 2015 | $1.4 | $14.0 |
(a) | Three and six month prior year periods include $5.8 million in proceeds from a bankruptcy settlement related to a former land sale customer. |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | Six Months Ended | ||||||
June 30, 2014 | $36.5 | $39.1 | ||||||
Changes Attributable to: | ||||||||
Volume/Mix | (30.1 | ) | (24.7 | ) | ||||
Price | 3.8 | 16.7 | ||||||
Cost | (0.8 | ) | (1.5 | ) | ||||
Other (b) | ($5.8 | ) | ($5.8 | ) | ||||
June 30, 2015 | $3.6 | $23.8 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
(b) | Three and six month prior year periods include $5.8 million in proceeds from a bankruptcy settlement related to a former land sale customer. |
Sales (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | $29.2 | $64.9 | |||||
Changes Attributable to: | |||||||
Volume/Other | (0.4 | ) | (8.0 | ) | |||
Price | (8.2 | ) | (15.3 | ) | |||
Other | (0.8 | ) | (1.2 | ) | |||
June 30, 2015 | $19.8 | $40.5 |
Operating (Loss) Income (in millions of dollars) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | ($0.1) | ($0.5 | ) | ||||
Changes Attributable to: | |||||||
Foreign exchange | 0.2 | 1.3 | |||||
Other | (0.2 | ) | (0.6 | ) | |||
June 30, 2015 | ($0.1) | $0.2 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | Six Months Ended | |||||
June 30, 2014 | ($0.1) | ($0.5 | ) | ||||
Changes Attributable to: | |||||||
Foreign exchange | 0.2 | 1.3 | |||||
Other | (0.2 | ) | (0.6 | ) | |||
June 30, 2015 | ($0.1) | $0.2 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
June 30, | December 31, | ||||||
(millions of dollars) | 2015 | 2014 | |||||
Cash and cash equivalents | $91.6 | $161.6 | |||||
Total debt | 752.4 | 751.5 | |||||
Shareholders’ equity | 1,477.3 | 1,575.2 | |||||
Total capitalization (total debt plus equity) | 2,229.7 | 2,326.7 | |||||
Debt to capital ratio | 34 | % | 32 | % | |||
Net debt to enterprise value (a) | 17 | % | 14 | % |
(a) | Enterprise value is calculated as the number of shares outstanding multiplied by the Company’s share price plus net debt as of June 30, 2015 and December 31, 2014. |
(millions of dollars) | 2015 | 2014 | |||||
Cash provided by (used for): | |||||||
Operating activities | $85.9 | $229.1 | |||||
Investing activities | (107.3 | ) | (95.4 | ) | |||
Financing activities | (44.1 | ) | (111.3 | ) |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net (Loss) Income to Adjusted EBITDA Reconciliation | |||||||||||||||
Net (loss) income | ($2.9 | ) | $16.1 | $15.3 | $57.5 | ||||||||||
Interest, net, continuing operations | 9.7 | 16.2 | 19.7 | 27.9 | |||||||||||
Income tax (benefit) expense, continuing operations | (0.3 | ) | 13.6 | (0.7 | ) | 5.9 | |||||||||
Depreciation, depletion and amortization | 23.9 | 30.3 | 53.8 | 56.3 | |||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | 1.2 | 2.3 | 4.9 | 5.4 | |||||||||||
Costs related to shareholder litigation (a) | 1.5 | — | 1.6 | — | |||||||||||
Cost related to spin-off of the Performance Fibers business | — | 3.8 | — | 3.8 | |||||||||||
Discontinued operations | — | (12.1 | ) | — | (43.1 | ) | |||||||||
Adjusted EBITDA | $33.1 | $70.2 | $94.6 | $113.7 |
Three Months Ended | Southern Timber | Pacific Northwest Timber | New Zealand Timber | Real Estate | Trading | Corporate and other | Total | ||||||||||||||||||||
June 30, 2015 | |||||||||||||||||||||||||||
Operating income (loss) | $11.8 | $1.7 | ($0.9 | ) | $1.4 | ($0.1 | ) | ($7.4 | ) | $6.5 | |||||||||||||||||
Depreciation, depletion and amortization | 12.6 | 2.9 | 7.1 | 1.0 | — | 0.3 | 23.9 | ||||||||||||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | — | — | — | 1.2 | — | — | 1.2 | ||||||||||||||||||||
Costs related to shareholder litigation (a) | — | — | — | — | — | 1.5 | 1.5 | ||||||||||||||||||||
Adjusted EBITDA | $24.4 | $4.6 | $6.2 | $3.6 | ($0.1 | ) | ($5.6 | ) | $33.1 | ||||||||||||||||||
June 30, 2014 | |||||||||||||||||||||||||||
Operating income (loss) | $8.9 | $8.8 | $2.2 | $27.8 | ($0.1 | ) | ($10.0 | ) | $37.6 | ||||||||||||||||||
Depreciation, depletion and amortization | 10.7 | 5.2 | 7.7 | 6.4 | — | 0.3 | 30.3 | ||||||||||||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | — | — | — | 2.3 | — | — | 2.3 | ||||||||||||||||||||
Adjusted EBITDA | $19.6 | $14.0 | $9.9 | $36.5 | ($0.1 | ) | ($9.7 | ) | $70.2 |
Six Months Ended | Southern Timber | Pacific Northwest Timber | New Zealand Timber | Real Estate | Trading | Corporate and other | Total | ||||||||||||||||||||
June 30, 2015 | |||||||||||||||||||||||||||
Operating income (loss) | $24.2 | $4.3 | $4.8 | $14.0 | $0.2 | ($13.2 | ) | $34.3 | |||||||||||||||||||
Depreciation, depletion and amortization | 27.0 | 6.7 | 15.1 | 4.9 | — | 0.1 | 53.8 | ||||||||||||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | — | — | — | 4.9 | — | — | 4.9 | ||||||||||||||||||||
Costs related to shareholder litigation (a) | — | — | — | — | — | 1.6 | 1.6 | ||||||||||||||||||||
Adjusted EBITDA | $51.2 | $11.0 | $19.9 | $23.8 | $0.2 | ($11.5 | ) | $94.6 | |||||||||||||||||||
June 30, 2014 | |||||||||||||||||||||||||||
Operating income (loss) | $19.4 | $21.4 | $4.6 | $28.5 | ($0.5 | ) | ($21.4 | ) | $52.0 | ||||||||||||||||||
Depreciation, depletion and amortization | 22.7 | 11.5 | 14.2 | 7.3 | — | 0.6 | 56.3 | ||||||||||||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | — | — | 2.1 | 3.3 | — | — | 5.4 | ||||||||||||||||||||
Adjusted EBITDA | $42.1 | $32.9 | $20.9 | $39.1 | ($0.5 | ) | ($20.8 | ) | $113.7 |
(a) | Costs related to shareholder litigation include expenses incurred as a result of the securities litigation, the shareholder’s derivative demands and the Securities and Exchange Commission investigation. See Note 12—Contingencies. |
Six Months Ended June 30, | |||||||
2015 | 2014 | ||||||
Cash provided by operating activities | $85.9 | $229.1 | |||||
Capital expenditures from continuing operations (a) | (26.1 | ) | (33.6 | ) | |||
Real estate development costs | (0.6 | ) | (2.6 | ) | |||
Cash flow from discontinued operations | — | (64.0 | ) | ||||
Working capital and other balance sheet changes | (6.9 | ) | (88.8 | ) | |||
CAD | 52.3 | 40.1 | |||||
Mandatory debt repayments | — | — | |||||
Adjusted CAD | $52.3 | $40.1 |
Cash used for investing activities | ($107.3 | ) | ($95.4 | ) | |||
Cash used for financing activities | ($44.1 | ) | ($111.3 | ) |
(a) | Capital expenditures exclude timberland acquisitions of $88.4 million and $74.8 million during the six months ended June 30, 2015 and June 30, 2014, respectively. |
Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Item 4. | CONTROLS AND PROCEDURES |
Item 1. | Legal Proceedings |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased (a) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a) | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (b) | |||||||||
April 1 to April 30 | — | — | — | 3,836,655 | |||||||||
May 1 to May 31 | — | — | — | 3,836,655 | |||||||||
June 1 to June 30 | 412,500 | $25.94 | 412,500 | 7,331,682 | |||||||||
Total | 412,500 | 412,500 | 7,331,682 |
(a) | Purchases made in open-market transactions under the $100 million share repurchase program announced on June 16, 2015. |
(b) | Maximum number of shares yet to be purchased as of June 30, 2015 include 3,836,655 under the 1996 anti-dilutive program and approximately 3,495,027 under the share repurchase program. |
Item 6. | Exhibits |
10.1 | Credit Agreement dated August 5, 2015 among Rayonier Inc., Rayonier TRS Holdings Inc. and Rayonier Operating Company LLC, as Borrowers, COBANK, ACB, as Administrative Agent, Swing Line Lender and Issuing Bank, JPMORGAN CHASE BANK, N.A. And FARM CREDIT OF FLORIDA, ACA, as Co-Syndication Agents CREDIT SUISSE AG and SUNTRUST BANK, as Co-Documentation Agents and COBANK, ACB, as Sole Lead Arranger and Sole Bookrunner | Incorporated by reference to Exhibit 10.1 to the Registrant’s August 5, 2015 Form 8-K | |
31.1 | Chief Executive Officer’s Certification Pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed herewith | |
31.2 | Chief Financial Officer’s Certification Pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed herewith | |
32 | Certification of Periodic Financial Reports Under Section 906 of the Sarbanes-Oxley Act of 2002 | Furnished herewith | |
101 | The following financial information from our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2015, formatted in Extensible Business Reporting Language (“XBRL”), includes: (i) the Consolidated Statements of (Loss) Income and Comprehensive (Loss) Income for the Three and Six Months Ended June 30, 2015 and 2014; (ii) the Consolidated Balance Sheets as of June 30, 2015 and December 31, 2014; (iii) the Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2015 and 2014; and (iv) the Notes to Consolidated Financial Statements | Filed herewith |
RAYONIER INC. | ||
(Registrant) | ||
By: | /s/ H. EDWIN KIKER | |
H. Edwin Kiker Chief Accounting Officer (Duly Authorized Officer, Principal Accounting Officer) |
1. | I have reviewed this quarterly report on Form 10-Q of Rayonier Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/S/ DAVID L NUNES | |
David L. Nunes President and Chief Executive Officer, Rayonier Inc. |
1. | I have reviewed this quarterly report on Form 10-Q of Rayonier Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ MARK MCHUGH | |
Mark McHugh Senior Vice President and Chief Financial Officer, Rayonier Inc. |
1. | The quarterly report on Form 10-Q of Rayonier Inc. (the "Company") for the period ended June 30, 2015 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ DAVID L. NUNES | /s/ MARK MCHUGH | |
David L. Nunes | Mark McHugh | |
President and Chief Executive Officer, Rayonier Inc. | Senior Vice President and Chief Financial Officer, Rayonier Inc. |