UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED)
November 9, 2016
RAYONIER INC.
COMMISSION FILE NUMBER 1-6780
Incorporated in the State of North Carolina
I.R.S. Employer Identification Number 13-2607329
225 Water Street, Suite 1400
Jacksonville, Florida 32202
(Principal Executive Office)
Telephone Number: (904) 357-9100
Check the appropriate box below if the form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
RAYONIER INC.
TABLE OF CONTENTS
PAGE | |||||
Item 7.01. | 1 | ||||
Item 9.01. | 3 | ||||
4 | |||||
5 | |||||
ITEM 7.01. | Regulation FD Disclosure |
On November 9, 2016, Rayonier Inc. (the “Company”) posted presentation materials on the investor relations section of the Company’s website at http://phx.corporate-ir.net/phoenix.zhtml?c=91500&p=irol-irhome. Members of the Company’s management may use all or portions of these materials from time to time during the fiscal year ending December 31, 2016 in meetings with or when making presentations to the investment community, current or potential stakeholders and others. The presentation materials are furnished herewith as Exhibit 99.1.
By filing this Current Report on Form 8-K and furnishing the information contained herein, the Company makes no admission as to the materiality of any information in this report that is required to be disclosed solely by reason of Regulation FD. The information contained in the investor presentation is summary information that it is intended to be considered solely in the context of the Company’s Securities and Exchange Commission (“SEC”) filings and other public announcements that the Company may make, by press release or otherwise, from time to time. The Company undertakes no duty or obligation to publicly update or revise the information contained in this report, although it may do so from time to time as management believes is warranted. Any such updating may be made through the filing of other reports or documents with the SEC, through press releases or through other public disclosure.
The information presented in Item 7.01 of this Current Report on Form 8-K and Exhibit 99.1 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, unless the Company specifically states that the information is to be considered “filed” under the Exchange Act or specifically incorporates it by reference into a filing under the Securities Act of 1933, as amended, or the Exchange Act.
By filing this, certain statements in this presentation regarding anticipated financial outcomes including Rayonier’s earnings guidance, if any, business and market conditions, outlook, expected dividend rate, Rayonier’s business strategies, including expected harvest schedules, timberland acquisitions and sales of non-strategic timberlands, the anticipated benefits of Rayonier’s business strategies, and other similar statements relating to Rayonier’s future events, developments or financial or operational performance or results, are “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as “may,” “will,” “should,” “expect,” “estimate,” “believe,” “intend,” “project,” “anticipate” and other similar language. However, the absence of these or similar words or expressions does not mean that a statement is not forward-looking. While management believes that these forward-looking statements are reasonable when made, forward-looking statements are not guarantees of future performance or events and undue reliance should not be placed on these statements.
The following important factors, among others, could cause actual results or events to differ materially from those expressed in forward-looking statements that may have been made in this document: the cyclical and competitive nature of the industries in which we operate; fluctuations in demand for, or supply of, our forest products and real estate offerings; entry of new competitors into our markets; changes in global economic conditions and world events, including political changes in particular regions or countries; fluctuations in demand for our products in Asia, and especially China; various lawsuits relating to matters arising out of our previously announced internal review and the restatement of our consolidated financial statements; the uncertainties of potential impacts of climate-related initiatives; the cost and availability of third party logging and trucking services; the geographic concentration of a significant portion of our timberland; our ability to identify, finance and complete timberland acquisitions; changes in environmental laws and regulations, timber harvesting, delineation of wetlands, and endangered species, that may restrict or adversely impact our ability to conduct our business, or increase the cost of doing so; adverse weather conditions, natural disasters and other catastrophic events such as hurricanes, wind storms and wildfires, which can adversely affect our timberlands and the production, distribution and availability of our products; interest rate and currency movements; our capacity to incur additional debt, and any decision we may make to do so; changes in tariffs, taxes or treaties relating to the import and export of our products or those of our competitors; changes in key management and personnel; our ability to meet all necessary legal requirements to continue to qualify as a real estate investment trust (“REIT”) and changes in tax laws that could adversely affect tax treatment of our specific businesses or reduce the benefits associated with REIT status.
Specifically with respect to our Real Estate business, the following important factors, among others, could cause actual results to differ materially from those expressed in forward-looking statements that may have been made in this document: the cyclical nature of the real estate business generally, including fluctuations in demand for both entitled and unentitled property; a delayed or weak recovery in the housing market; the lengthy, uncertain and costly process associated with the ownership, entitlement and development of real estate, especially in Florida, which also may be affected by changes in law, policy and political factors beyond our control; the potential for legal challenges to entitlements and permits in connection with our properties; unexpected delays in the entry into or closing of real estate transactions; the existence of competing developers and communities in the markets in which we own property; the pace of development and the rate and timing of absorption of existing entitled property in the markets in which we own property; changes in the demographics affecting projected population growth and migration to the Southeastern U.S.; changes in environmental laws and regulations, including laws regarding water withdrawal and management and delineation
1
of wetlands, that may restrict or adversely impact our ability to sell or develop properties; the cost of the development of property generally, including the cost of property taxes, labor and construction materials; the timing of construction and availability of public infrastructure; and the availability of financing for real estate development and mortgage loans.
For additional factors that could impact future results, please see Item 1A - Risk Factors in the company’s most recent Annual Report on Form 10-K and similar discussions included in other reports that we subsequently file with the Securities and Exchange Commission (the “SEC”).
Forward-looking statements are only as of the date they are made, and the Company undertakes no duty to update its forward- looking statements except as required by law. You are advised, however, to review any further disclosures we make on related subjects in our subsequent reports filed with the SEC.
2
ITEM 9.01. | Financial Statements and Exhibits. |
(d) | Exhibits. |
The following is filed as an Exhibit to this Report.
Exhibit No. | Exhibit Description | ||
99.1 | Investor Presentation, dated November 2016. | ||
3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of l934, the registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
RAYONIER INC. (Registrant) | ||
BY: | /s/ APRIL TICE | |
April Tice | ||
Director, Financial Services and Corporate Controller | ||
November 9, 2016
4
EXHIBIT INDEX
EXHIBIT NO. | DESCRIPTION | LOCATION | ||
99.1 | Investor Presentation, dated November 2016. | Furnished herewith. | ||
5
Investor Day | November 2016
Investor Day | November 2016
Investor Day | November 2016
Safe Harbor Statement
Forward-Looking Statements - Certain statements in this presentation regarding anticipated financial outcomes including Rayonier’s earnings guidance, if any,
business and market conditions, outlook, expected dividend rate, Rayonier’s business strategies, including expected harvest schedules, timberland acquisitions, sales
of non-strategic timberlands, the anticipated benefits of Rayonier’s business strategies, and other similar statements relating to Rayonier’s future events,
developments or financial or operational performance or results, are “forward-looking statements” made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as “may,” “will,”
“should,” “expect,” “estimate,” “believe,” “intend,” “project,” ‘anticipate” and other similar language. However, the absence of these or similar words or expressions
does not mean that a statement is not forward- looking. While management believes that these forward-looking statements are reasonable when made, forward-
looking statements are not guarantees of future performance or events and undue reliance should not be placed on these statements.
The following important factors, among others, could cause actual results or events to differ materially from those expressed in forward-looking statements that may
have been made in this document: the cyclical and competitive nature of the industries in which we operate; fluctuations in demand for, or supply of, our forest
products and real estate offerings; entry of new competitors into our markets; changes in global economic conditions and world events; fluctuations in demand for our
products in Asia, and especially China; various lawsuits relating to matters arising out of our previously announced internal review and restatement of our consolidated
financial statements; the uncertainties of potential impacts of climate-related initiatives; the cost and availability of third party logging and trucking services; the
geographic concentration of a significant portion of our timberland; our ability to identify, finance and complete timberland acquisitions; changes in environmental laws
and regulations regarding timber harvesting, delineation of wetlands, and endangered species, that may restrict or adversely impact our ability to conduct our
business, or increase the cost of doing so; adverse weather conditions, natural disasters and other catastrophic events such as hurricanes, wind storms and wildfires,
which can adversely affect our timberlands and the production, distribution and availability of our products; interest rate and currency movements; our capacity to incur
additional debt; changes in tariffs, taxes or treaties relating to the import and export of our products or those of our competitors; changes in key management and
personnel; our ability to meet all necessary legal requirements to continue to qualify as a real estate investment trust (“REIT”) and changes in tax laws that could
adversely affect beneficial tax treatment; the cyclical nature of the real estate business generally; a delayed or weak recovery in the housing market; the lengthy,
uncertain and costly process associated with the ownership, entitlement and development of real estate, especially in Florida, which also may be affected by changes
in law, policy and political factors beyond our control; unexpected delays in the entry into or closing of real estate transactions; changes in environmental laws and
regulations that may restrict or adversely impact our ability to sell or develop properties; the timing of construction and availability of public infrastructure; and the
availability of financing for real estate development and mortgage loans.
For additional factors that could impact future results, please see Item 1A - Risk Factors in the Company’s most recent Annual Report on Form 10-K and similar
discussion included in other reports that we subsequently file with the Securities and Exchange Commission (the “SEC”). Forward-looking statements are only as of
the date they are made, and the Company undertakes no duty to update its forward-looking statements except as required by law. You are advised, however, to
review any further disclosures we make on related subjects in our subsequent reports filed with the SEC.
Non-GAAP Financial Measures - To supplement Rayonier’s financial statements presented in accordance with generally accepted accounting principles in the
United States (“GAAP”), Rayonier uses certain non-GAAP measures, including “cash available for distribution,” "pro forma sales," “pro forma operating income,” “pro
forma net income,” and “Adjusted EBITDA,” which are defined and further explained in this communication. Reconciliation of such measures to the nearest GAAP
measures can also be found in this communication. Rayonier’s definitions of these non-GAAP measures may differ from similarly titled measures used by others.
These non-GAAP measures should be considered supplemental to, and not a substitute for, financial information prepared in accordance with GAAP.
1
Investor Day | November 2016
Today’s Presenters and Agenda
Opening Remarks Dave Nunes | President & Chief Executive Officer
New Zealand Timberlands Paul Nicholls | Managing Director, Rayonier NZ
Southern & Pacific Northwest Doug Long | Senior Vice President, U.S. Operations
Value Maximization on Land Base Jim Gent | Director, Research & Silviculture
Vernon Hiott | Manager, Business Development
Jeff Lawrence | Director, Real Estate & Land Resources
Portfolio Management Rhett Rogers | Director, Land Asset Management
Real Estate Chris Corr | SVP, Real Estate & Public Affairs
Charles Adams | VP Community Development
Financial Overview Mark McHugh | SVP & Chief Financial Officer
Closing Remarks, Q&A Dave Nunes
2
Investor Day | November 2016
Opening Remarks
Dave Nunes | President & Chief Executive Officer
3
Investor Day | November 2016
Rayonier – Best-in-Class, Pure-Play Timber REIT
Second-largest timber
REIT with 2.7 million
acres of high-quality
timberland
Geographic diversity –
U.S. South, Pacific
Northwest, New Zealand
Timberlands
strategically positioned
in competitive fiber
baskets
Focus on recurring cash
flow generation from
timber harvest and HBU
sales
Profitably growing
timberland base through
disciplined acquisition
process
Over $1.3 billion of high-
quality timberlands
acquired since January
2011
Investing in advanced
genetics to yield long-
term volume growth
Attractive HBU
opportunities across
U.S. South, including
Florida and Georgia
coastal corridor
Stable and recurring
base of annual rural
land sales
Two active development
projects underway –
Wildlight (mixed-use)
and Belfast Commerce
(industrial)
Net debt to enterprise
value of 23% at end of
Q3 2016
Favorable financing
facilities and access to
capital
Active portfolio
management and
nimble capital allocation
strategy
4
Leading Pure-Play
Timberland REIT
Attractive
Real Estate Platform
Strong Capital
Structure
Growing Timberland
Base
Investor Day | November 2016
Highly Productive, Geographically Diversified Timberlands
5
436
Total Rayonier = 2.7 million acres
188
92 15
146
89 324
656
374
317
62
Pacific Northwest
U.S. South
New Zealand
379,000 acres – Washington & Oregon; access to export markets
1.9 million acres – sawlog and pulpwood; Florida & Georgia coastal corridor HBU
436,000 acres – manage and own ~77% of joint venture
374
Note: Total acreage as of Q3 2016; does not reflect recently announced divestiture of 62,100 acres in Alabama and Mississippi.
Investor Day | November 2016
Note: Timberland REIT Peer Group comprised of WY (legacy), PCL (legacy), PCH and CTT. Figures reflect aggregate Timberland REIT Peer Group 2013-2015 EBITDA excluding
corporate expenses. Other includes real estate, manufacturing and other reported segments. WY (legacy) excludes divested Cellulose Fibers business.
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Leading “Pure-Play” Timberland REIT
6
Rayonier – EBITDA* Composition (2013-15)
Rayonier is a leading “pure-play” timberland REIT that generates the significant majority of its
EBITDA* from recurring timber harvest operations.
Peer Group – EBITDA* Composition (2013-15)
Timber
Segments
74%
Other
26%
Timber
Segments
51%
Other
49%
Investor Day | November 2016
The Rayonier Roadmap to Success
7
As Rayonier nears the century mark, we are excited about our focused long-term strategy
which, coupled with our strong culture, will chart the path to achieving our vision.
Preferred timberland investment
vehicle for institutional investors
Best-in-class assets, operations,
disclosure and transparency
Preferred employer for forestry
and land management
professionals
Provide industry-leading returns
through intensive asset management
and effective capital allocation
Culture
Mission Statement
Working together as a team
with empowered people and
strong core values
Strategy
Long-term strategy focused
on creating value from our
timberlands and HBU portfolio
Capital
Allocation
Building long-term value per
share through nimble capital
allocation
Vision
Investor Day | November 2016
Rayonier’s Strategic Priorities
8
Rayonier’s goal is to provide an attractive, growing dividend funded from core, recurring cash
flows in a tax-efficient REIT structure.
Manage for
Long-Term Value
Acquire
High-Quality
Timberlands
Optimize
Portfolio Value
Focus on
Quality of Earnings
Enhance
Disclosure
Design harvest strategy to achieve long-term, sustainable yield
Balance biological growth, harvest cash flow and responsible stewardship
Focus on harvest operations and rural land sales to support dividends
De-emphasize sale of “non-strategic” timberlands to augment cash flow
Establish Rayonier as industry leader in transparent disclosure
Provide investors with meaningful information about timberland portfolio
Opportunistically monetize lands where premium valuations can be achieved
Pursue value creation activities on select properties to enhance long-term value
Pursue acquisitions that improve portfolio quality and sustainable yield
Maintain disciplined approach to acquisitions, minimize HBU speculation
Investor Day | November 2016
Our Culture Drives Long-term Shareholder Value Creation
Safety is our top priority and we
continuously look for ways to
operate safer
9
Safety First
Our people are the foundation of our success.
Push decisions down deeper into
the organization and encourage
employees to take ownership
Empower Employees
“One Rayonier” focus – working
together, we can create value
Teamwork & Collaboration
Trust, integrity and accountability
are core values of Rayonier
Core Values
Manage our land and resources to
maximize long-term value, not short-
term profits
Long-Term Focus
Committed to continuous
improvement through the growth
and development of our employees
Continuous Improvement
Provide best-in-class disclosure and
transparency, both internally and
externally
Transparency
Challenge employees to look for a
better way and to speak up when
they can make a difference
Courage to Challenge
Investor Day | November 2016
Nimble Approach to Capital Allocation
10
Acquired over
$500 million of
timberlands since
spin-off
Acquisitions
complementary to
age-class profile
Improved portfolio
site index and
inventory stocking
~$34 million
invested annually
in silviculture and
regeneration
Capital focused
on highest IRR
opportunities
Targeted
investments to
unlock HBU value
Invest in Our
Business
Timberland
Acquisitions
Share Buybacks
$101 million of
stock buybacks
@ $23.76/share
$99 million
remaining in
repurchase
authorization
Focused on
generating NAV
accretion
Dividend of $1.00
per share since
Q4 2014
Expect to fund
from recurring
timber and real
estate operations
Core timberland
sales excluded
from CAD*
Dividends
Restructured
$155 million of
New Zealand debt
96% of debt fixed;
3.3% avg. rate
Maintained
investment grade
rating with higher
debt threshold
Manage Our
Balance Sheet
$34MM(1)
annually for
silviculture
$500MM
acquisitions
since spin-off
$101MM
share buybacks
since spin-off
3.8% yield(2)
$1.00 per share
annual dividend
3.3% rate
average
debt cost
(1) Represents average annual investment in silviculture and replanting from 2013-2015.
(2) Based on share price of $25.99 as of 11/4/2016.
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Investor Day | November 2016
Significant Milestones Since the Spin-Off
11
We have made considerable progress in shaping our culture and pursuing strategic initiatives
that further the progress towards achieving our vision.
Culture
New senior leadership team and Board of Directors
Revamped incentive compensation system
Right-sized the organization
New office under construction
Strategy
Upgraded assets through active portfolio management
Launch of community development business
Changed the conversation around investor disclosure
Capital
Allocation
Pacific Northwest asset repositioning
New Zealand recapitalization
Lowered cost of debt and extended maturities
Closed dividend funding gap
Investor Day | November 2016
Improving Supply / Demand Dynamics on Horizon
U.S. housing starts
continue modest
recovery following
recession
Recovery led by multi-
family starts, which use
one-third the lumber of
single-family starts
Shortage of labor and
finished lots slowing the
rate of recovery in
single-family starts
Housing starts expected
to continue to grow at
modest pace, reaching
1.5 million starts by end
of decade
One-year litigation
moratorium expired in
mid-October
Two sides continue to
discuss potential
resolution
Legal action expected to
lead to tariffs in Q2 2017
Combination of higher
lumber prices and lower
Canadian market share
in U.S. expected to
driver higher sawlog
prices
Mountain Pine Beetle
epidemic has resulted in
mortality of over 50% of
lodgepole pine in interior
British Columbia
Timber generally has an
economic shelf life of
~10 years once it has
been killed by beetle
Expected decline in
economically viable pine
inventory will be more
pronounced over next
five years
U.S. log exports to
China were not present
at the last peak in
housing starts in 2005
U.S. log exports to
China resumed in late
2009 after many years
of little to no volume
Current levels of U.S.
log exports to China are
at lower levels than the
peak in 2011, but still
represent a substantial
component of demand
12
U.S. Housing
Market Recovery
Supply Reductions
from Mountain Pine
Beetle
Sustained Demand
from China
Softwood Lumber
Agreement
Resolution
Investor Day | November 2016
–
2.5
5.0
7.5
10.0
12.5
–
500
1,000
1,500
2,000
2,500
Starts per 1,000 of Populati
onAn
nu
al
Ho
usin
g S
tar
ts
(00
0s
)
Single-Family Multi-Family Starts per 1,000 of Population
Residential Construction Improving, But Still Long Way to Go
13
Historical Annual Housing Starts
While housing starts have improved significantly from 2009 lows, the current pace of
construction remains at or below historical trough levels.
Source: U.S. Census Bureau.
1966 Trough
• 1.16mm Starts
• 779k SF Starts
• 5.9 per 1,000
1975 Trough
• 1.16mm Starts
• 892k SF Starts
• 5.4 per 1,000
1982 Trough
• 1.06mm Starts
• 663k SF Starts
• 4.6 per 1,000
1991 Trough
• 1.01mm Starts
• 840k SF Starts
• 4.0 per 1,000
2009 Trough
• 554k Starts
• 445k SF Starts
• 1.8 per 1,000
2015 / Current
• 1.11mm Starts
• 715k SF Starts
• 3.5 per 1,000
Investor Day | November 2016
Lumber Margins Have Recovered, Timber Poised To Follow
14
U.S. South Sawmill Variable Costs / Margin vs. Lumber & Sawtimber Prices
While sawtimber prices have been relatively stagnant over the last year, increases in sawmill
margins should accrue to timber suppliers over time.
Source: Forest Economic Advisors, RISI, Random Lengths, Timber Mart-South and Rayonier analysis.
–
$10
$20
$30
$40
$50
$60
$70
$80
$90
–
$50
$100
$150
$200
$250
$300
$350
$400
$450
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q3-16
Sawtim
ber Stumpage
Price
Mill
Va
riable
C
osts
/ Co
mp
osite
Lu
mb
er
Pr
ice
Wood Cost (Stumpage) Other Variable Costs Variable Margin RL Composite Price Sawtimber Price
($ per MBF) ($ per ton)
Investor Day | November 2016
Following SLA Expiration, Canadian Imports Have Surged
15
Major Sources of U.S. Lumber Supply
Increased housing starts and corresponding increases in U.S. lumber consumption have
largely been offset by increased imports from Canada following the SLA expiration.
Source: Western Wood Products Association, Forest Economic Advisors.
U.S. Production – (4%) (9%) (17%) (20%) 6% 6% 7% 6% 5% 0% 2%
Canadian Imports – (6%) (17%) (30%) (29%) 9% (2%) 8% 15% 11% 9% 19%
Year-over-Year Change
–
5%
10%
15%
20%
25%
30%
35%
–
10
20
30
40
50
60
70
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016F
% Share of Im
ports from Ca
nad
a
BB
F (
Lu
mb
er)
U.S. Lumber Production Imports from Canada Imports from Offshore % Share of Imports from Canada
Investor Day | November 2016
–
200
400
600
800
1,000
1,200
1,400
1,600
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Live <8 yrs 9-10 yrs 11-12 yrs >12 yrs
Availability of Viable B.C. Timber Is Expected to Decline Rapidly
16
Inventory of Available Live and Dead Lodgepole Pine by Years Since Attack
The mountain pine beetle epidemic is expected to significantly constrain the availability of
economically viable pine inventory in B.C. for many decades.
Source: B.C. Ministry of Forests, Forest Economic Advisors.
(Mil m3)
2015 – 2020:
~39% Decline in
< 12 yrs Dead Volume
2010 – 2015:
~19% Decline in
< 12 yrs Dead Volume
Economic “Shelf-Life” of Beetle Kill Wood = 8-12 Years
Duration Since Mortality:
Investor Day | November 2016
–
50
100
150
200
250
300
350
400
450
500
–
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
Hou
s
in
g
St
a
rt Eq
u
iv
a
le
nt
s
(0
0
0
s
)
B
B
F
(L
u
m
b
e
r)
Rest of World China Housing Start Equivalents
–
50
100
150
200
250
300
350
400
450
500
–
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
Hou
s
in
g
St
a
rt Eq
u
iv
a
le
nt
s
(0
0
0
s
)
B
B
F
(L
o
g
s
)
Rest of World China Housing Start Equivalents
Log and Lumber Export Volume Has Surged
17
U.S. Pacific Northwest Log Exports
China has driven substantial growth in log and lumber exports from North America over the last decade, with
average annual demand over the last three years equivalent to roughly 310,000 single-family housing starts.
Source: Forest Economic Advisors.
Note: Housing start equivalents calculated based on 18 MBF of lumber per single-family start and log-to-lumber recovery rate of 2.35.
North American Lumber Exports
2014-16 Avg. China Demand = ~100k Starts 2014-16 Avg. China Demand = ~210k Starts
Investor Day | November 2016
Review of Agenda for Investor Day
Overview of New Zealand JV
Overview of Southern and Pacific Northwest timberlands
Panel discussion on how we maximize value on our land base
Applying advanced R&D to our land base
Utilizing market intelligence
Role of land resources in maximizing returns
Portfolio management strategy
Unlocking the value of our Real Estate portfolio
Financial overview and benchmarking
Tour of local timberland operations and Wildlight mixed-use development project
18
Investor Day | November 2016
New Zealand Timberlands
Paul Nicholls | Managing Director, Rayonier New Zealand
19
Investor Day | November 2016
New Zealand Timber – Segment Overview
20
Map of Properties
Rayonier’s ~77%-owned joint venture in New Zealand provides geographic, species and
market diversification.
Note: New Zealand Timber was consolidated on April 4, 2013 when we acquired a majority interest in the New Zealand JV. Prior to the acquisition date, we accounted for our 26%
interest in the New Zealand JV as an equity method investment. The 2013 and 2012 information shown here reflects full year results for the JV.
* Non-GAAP measure (see Appendix for definitions and reconciliations).
Historical Harvest Volume / Rate of Harvest
Historical EBITDA* / EBITDA per Ton
Acreage: 436k acres
Sustainable Yield: 2.3mm tons
Planted: 68%
(tons in 000s) (tons per acre per year)
($ in millions) ($ per ton)
NA
2,808
2,405 2,360 2,412
4.0
5.0
6.0
7.0
8.0
9.0
10.0
–
500
1,000
1,500
2,000
2,500
3,000
2011 2012 2013 2014 2015
Harvest Tons per Acre
NA
$35
$46 $46
$33
–
$5
$10
$15
$20
$25
–
$10
$20
$30
$40
$50
2011 2012 2013 2014 2015
EBITDA EBITDA / Ton
Investor Day | November 2016
Rayonier Matariki Forests (RMF) – Key Facts
21
RMF is a JV between Rayonier & Phaunos
Timber Fund; 77% Rayonier ownership
436,000 gross acres; 299,000 planted acres
3rd largest forest owner in NZ with 7% of
plantation resource
90 staff, 6 locations; leadership team average
16 year tenure with RMF
Harvest ~2.3 million tons per year, plus trading
volume of ~1 million tons per year
RMF Key Facts
RMF Land Tenure
Five Key Operating Units + Head Office
Freehold
(Fee) land,
42%
Crown Forest
Licence, 25%
Forestry
Right, 29%
Leasehold, 4%
Investor Day | November 2016
Diversified Mix of Domestic & Export Markets
22
Volume by Market Destination (2016 YTD)
Over 60% of RMF’s volume (including Trading volume) is sold into export markets, with China
being the largest source of demand.
Note: Year-to-date as of 9/30/2016.
RMF Export
36%
Trading Export
27%
NZ Domestic
37% China
52%
Korea
21%
India
20%
Other
7%
Investor Day | November 2016
RMF Key Export Delivery Ports
23
RMF ships to 16 export ports in China, Korea, India and Taiwan.
0 – 20K
20K – 40K
40K+
Scale (m3)
Investor Day | November 2016
Inventory Levels Drive Near-Term Price Fluctuations
24
Inventory-to-Demand Ratio vs. Export Log Price
Export supply / demand is generally considered in balance when the ratio of port inventory to
average monthly demand is between 1.3 and 2.0 times.
–
$20
$40
$60
$80
$100
$120
$140
$160
$180
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
2011 2012 2013 2014 2015 2016
–
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
Chi
na CFR (US$
/ m3 JAS)
Inv
en
tor
y -
to-
De
ma
nd
Rat
io
(3-
mo
nth
A
vg
. De
ma
nd
)
Supply/demand range considered in balance
Investor Day | November 2016
New Zealand Log Prices Trending Upward
25
Historical New Zealand Log Prices (NZ$)
Over the last 10 years, New Zealand log prices have been trending upward based primarily on
growing export market demand.
Source: NZ Ministry of Primary Industries.
–
$20
$40
$60
$80
$100
$120
$140
$160
$180
Lo
g P
ric
e (
NZ
$ /
m3
FO
B)
Investor Day | November 2016
Southern and Pacific Northwest Timberlands
Doug Long | Senior Vice President, U.S. Operations
26
Investor Day | November 2016
Southern Timber – Segment Overview
27
Map of Properties
Rayonier’s Southern Timber segment has nearly doubled its Adjusted EBITDA* since 2011,
driven by acquisitions and price gains in key markets.
(1) Site index reflects the average height of the dominant and codominant trees at a base age of 25 (U.S. South).
* Non-GAAP measure (see Appendix for definitions and reconciliations).
Historical Harvest Volume / Rate of Harvest
Historical EBITDA* / EBITDA per Ton
(tons in 000s) (tons per acre per year)
($ in millions) ($ per ton)
Acreage: 1.9mm acres
Sustainable Yield: 5.5 – 5.8mm tons
Planted/Plantable: 67%
Average Site Index(1): 71 feet
4,741
5,322 5,292 5,296 5,492
1.0
1.5
2.0
2.5
3.0
3.5
4.0
3,000
3,500
4,000
4,500
5,000
5,500
6,000
2011 2012 2013 2014 2015
Harvest Tons per Acre
$57
$76 $87
$98 $101
$5
$10
$15
$20
–
$20
$40
$60
$80
$100
$120
2011 2012 2013 2014 2015
EBITDA EBITDA / Ton
Investor Day | November 2016
Pacific Northwest Timber – Segment Overview
28
Map of Properties
Following the recently-announced portfolio repositioning, Rayonier expects to harvest
roughly 1.3 million tons in the Pacific Northwest over the next five years.
(1) Site index reflects the average height of the dominant and codominant trees at a base age of 50 (Pacific Northwest).
(2) 2013 and prior results include volumes from New York timberlands.
* Non-GAAP measure (see Appendix for definitions and reconciliations).
Historical Harvest Volume / Rate of Harvest (2)
Historical EBITDA* / EBITDA per Ton
Acreage: 379k acres
Sustainable Yield: 1.4mm tons
Planted/Plantable: 78%
Average Site Index(1): 110 feet
(tons in 000s) (tons per acre per year)
($ in millions) ($ per ton)
1,665
1,947 1,979
1,664
1,243
1.0
2.0
3.0
4.0
5.0
6.0
–
500
1,000
1,500
2,000
2,500
2011 2012 2013 2014 2015
Harvest Tons per Acre
$49
$43
$54 $51
$22
$10
$15
$20
$25
$30
$35
$40
–
$10
$20
$30
$40
$50
$60
2011 2012 2013 2014 2015
EBITDA EBITDA / Ton
Investor Day | November 2016
U. S. Forest Resources
29
Resource Units
Business
Development
Land
Information
Services
Research &
Silviculture
Support
U.S. Forest
Resources
USFR
6 Resource Units across 10 states
79 employees oversee 2.3mm acres
6 Resource Unit Leaders – combined
98 years with Rayonier
Research & Silviculture Support
15 employees located in 4 states
Responsible for implementing our
capital investments in research &
seedling production
Business Development
Team of 2 responsible for market
intelligence, customer recruitment,
operational efficiencies and
strategic projects
Land Information Services
19 team members responsible for
land records, geographic
information systems, stand data
and inventory
Investor Day | November 2016
Resource Unit Coverage Map
30Note: Total acreage as of Q3 2016; does not reflect recently announced divestiture of 62,100 acres in Alabama and Mississippi.
Investor Day | November 2016
Flexible Resource Management Structure to Unlock Value
31
“One Rayonier”
Leadership
Land
Management
Forest
Protection
Data
Collection
Timber
Marketing
Real Estate
Land
Resources
Investor Day | November 2016
Local Markets Require Customized Solutions
32
Flexible Structure to Meet Local Needs
Resource Unit objectives and strategies are tailored to meet local stakeholder needs.
Overlapping Sourcing Zones = Optionality
Scale Customer Mix
Species
ProductsCompetitors
Harvest
Volume
Investor Day | November 2016
What Makes Rayonier Different?
33
Leadership Style
Decision making at all levels
Strategic Priorities
Long-term focus
“One Rayonier” Culture
Breaking down silos
Investor Day | November 2016
Value Maximization on Land Base
Jim Gent | Director, Research & Silviculture
Vernon Hiott | Manager, Business Development
Jeff Lawrence | Director, Real Estate & Land Resources
34
Investor Day | November 2016
35
Jim Gent
Research & Silviculture
Jim Gent | Director, Research & Silviculture
Investor Day | November 2016
(tons per acre per year)
Productivity is a Key Driver of Timberland Value
Rayonier Loblolly Pine Site Index25 (feet)
Higher site index properties generate greater harvest yields and a more valuable product mix.
Rayonier’s site index has been steadily improving with each plantation year.
(1) First physical site index measurement taken at age 11.
(2) Yield predictions based on PMRC (Plantation Management Research Cooperative) Technical Report 1996-1 (Yield Prediction and Growth Projection for Site-Prepared Loblolly
Pine Plantations in the Carolinas, Georgia, Alabama and Florida). Assumes 70% pine plantation and 30% hardwoods and non-forested areas.
Harvest Volume Increases with Site Index (2)
Product Mix Improves with Site Index (2)
60
65
70
75
80
85
1981 1986 1991 1996 2001 2006 2011 2016
S
it
e
In
d
e
x
2
5
(f
e
e
t)
Planting year
0%
20%
40%
60%
80%
100%
60 65 70 75 80 85
Pine ST Pine CNS Pine PW Hardwood
(%)
–
1.0
2.0
3.0
4.0
5.0
6.0
7.0
60 65 70 75 80 85
Recently
measured
stands(1)
36
Recently
harvested
stands
RYN avg. measured
loblolly site index = 73
Investor Day | November 2016
Multiple Opportunities to Enhance Productivity
37
Site-specific prescriptions supported by guidelines grounded in science and financial
analysis.
Post-thin
Release
Year 12-17
Thinning
Ages 10-15
Juvenile
Fertilization
Ages 3-6
At-Establishment
Fertilization
Year 1
Harvest
Year 22-28
Site
Preparation
Year 0
Southern Pine Plantation
Life Cycle &
Capital Investments
Mid-rotation
Fertilization
Age 11-16
Herb. Weed
Control
Year 0
Planting
Year 0
Investor Day | November 2016
Poorly Drained Soil
Dry Sandhill Soil
Response to Silvicultural Treatments is Site Specific
38
Large Variation in Soils Across Landscape
Soil type impacts silviculture prescription.
Investor Day | November 2016
$0
$50
$100
$150
$200
$250
$300
$350
$400
0
2
4
6
8
10
12
A B1 B2 C D
V
alue
G
ain
($/
a
c
)Heig
h
t
G
ain
(
ft
)
Soil Group
Height NPV
Site Preparation – Bedding on Poorly Drained Soils
39
Incremental Value / Height from Bedding
Value gain from bedding varies significantly among different soil types.
Source: Rayonier analysis.
Investor Day | November 2016
Tree Selection – Genetic Resources
40
Optimized deployment of controlled pollination planting with strong focus on internal genetic
breeding and testing.
Controlled
Pollination
34%
Open
Pollination
66%
Rayonier
Southern
Pine Planted
since 2012
• Wind-blown pollen source
• Known mother tree
• Half-sibling offspring
• Much better growth vs. non-
improved stock
• Good financial returns
• Controlled pollen source
• Known parents
• Full-sibling offspring
• Better growth vs. open
pollinated stock
• More expensive
• Better financial returns on
high-site land
Investor Day | November 2016
Optimum Harvest Regime – Loblolly Pine Thinning
41
Incremental Value from Thinning Driven by Site Index and Market Factors(1)
Rayonier only thins stands where positive value can be achieved. Ultimate thinning decisions
based on site index and market-specific factors.
(1) Based on actual Rayonier and university cooperative research site measurements.
(2) Sensitivity analysis based on growth/yield models representing average stand parameters for current planting prescriptions.
Coastal: No-thin Regime Optimal on High-Site Lands(2)
-$200
$0
$200
$400
$600
Optimal: THIN
-$100
-$50
$0
$50
$100
60 65 70 75 80 85 90
Site Index
Coastal
(change in NPV $ per acre)
Florida SouthwestGreater GAAlabama
Optimal: THINOptimal: NO THIN
(change in NPV $ per acre)
Optimal: THIN Optimal: NO THIN
Investor Day | November 2016
Sharp Focus on Maximizing Financial Returns
Complete competition control
Frequent fertilization treatments
42
Maximize Growth Rate
Site-specific prescriptions are made on the ground with a focus on maximizing the financial
return from invested silvicultural capital.
Functional competition control
Periodic fertilization treatments
Rayonier = Maximize Financial Return
Investor Day | November 2016
43
Jim Gent
Market Intelligence
Vernon Hiott | Manager, Business Development
Investor Day | November 2016
Business Development Focus Areas
Economic analysis and reporting
Timber supply and demand modeling
Performance benchmarking
Understand market opportunities, potential solutions and customers, partners
Develop relationships and plans for supporting new demand prospects
Recruit and evaluate demand prospects
Understand customer value drivers and build relationships
Develop strategic marketing plans
Grow and support an industry-leading timber marketing team
Develop and improve processes / standards to increase operational efficiency
Provide operational support tools for decision making
44
Market Intelligence
Timber Demand
Growth
Timber Marketing
Effectiveness
Process
Improvement
Investor Day | November 2016
Market Intelligence Relevant Topics
45
BC Mountain Pine Beetle
Eastern Canada AAC
Russian Log Supply
US Sawlog Inventories
Offshore Demand
US Housing Recovery
Containerboard Production Levels
Bioenergy Market Sustainability
Investor Day | November 2016
Change in Consumption by Region: 2005-2014
Recession-induced demand declines have led to large drops in consumption for most areas in the South
As a result, timber product prices have fallen with few exceptions
Differences in consumption declines have caused regional market performance to vary across the South
Consumption & Price Changes Vary Across the South
46
Change in Stumpage Price by Region: 2005-2016
Source: USDA FIA Timber Product Output; University of Georgia, Wood Demand Report;
Rayonier estimates.
Source: Timber Mart-South.
Note: Assumes composite mix of 50% pulpwood, 30% chip-n-saw and 20% sawtimber
comparing Timber Mart-South prices in Q3 2016 versus 2005 average.
Investor Day | November 2016
Change in Total Inventory by Region: 2005-2014
Since 2005, many regions have gained inventory beyond levels experienced historically
Inventory growth in these areas will take years to slow and will require new outlets for timber products
Timberland portfolio performance will be influenced by geographic distribution in the South
Total Inventory has Grown Significantly
47
Source: USDA FIA data; Rayonier analysis.
(1) Chart illustrates average U.S. South inventory growth by product category versus weighted average inventory growth in Rayonier markets.
Change in Total Inventory: RYN vs. South Avg. (1)
12%
22%
18%
5%
17%
13%
Pulpwood Sawtimber Total
US South Average Rayonier
Investor Day | November 2016
Change in Pulpwood Inventory by Region: 2005-2014
Pulpwood markets have generally remained stable or strengthened since 2005 driven by strong end-
product demand and lower levels of sawmill residuals
Grade volume is being stored on the stump in anticipation of stronger demand and higher prices
In some cases, reduced supply of pulpwood volume has caused pulp outlets to consume small grade-
size timber to meet mill needs
Inventory Growth is Predominantly in Grade
48Source: USDA FIA data; Rayonier analysis.
Change in Grade Inventory by Region: 2005-2014
Investor Day | November 2016
U.S. South Timber Supply / Demand Dynamics
49
Change in Inventory, Demand & Price
As a whole, timber demand and pricing in the U.S. South have generally moved together while
inventory has built to more than 20% above the level seen in 2000.
Source: Timber Mart-South; USDA FIA data; University of Georgia, Wood Demand Report; Rayonier Analysis.
Note: Stumpage price data assumes composite mix of 50% pulpwood, 30% chip-n-saw and 20% sawtimber.
Inventory:
U.S. South inventory has grown more than 20%
since 2000
Continued weak demand has increased pace of
inventory growth
Demand:
Demand increased with the U.S. housing
market in 2004/2005
Post-2005 demand fell to ~70% of the 2000
level
Additional consumption from the pellet industry
and some gains in operating rates have pushed
demand to ~80% of 2000 level in recent years
Price:
Composite pricing has largely moved with the
changes in demand
60
70
80
90
100
110
120
130
140
Standing Inventory Market Demand Stumpage Price
(indexed in 2000)
Investor Day | November 2016
Regional Market Price Trends Vary Significantly
50
Timber Mart-South 3Q2016 Composite Stumpage Price by Region
While timber demand and pricing has generally declined across the South, regional market
supply, demand and pricing trends vary significantly.
Source: Timber Mart-South.
Note: Composite price by region calculated based on assumed mix of 50% pulpwood, 30% chip-n-saw and 20% sawtimber.
3Q2016 Price Change versus 2005 Average Price
($ per ton)
(%)
374k
ac.
656k
ac.
146k
ac.
312k
ac.
–
$5.00
$10.00
$15.00
$20.00
$25.00
Rayonier Top-5 Markets Average
188k
ac.
-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
20.0%
Investor Day | November 2016
Regional Market Example: Northeast Florida
51
Change in Inventory, Demand & Price
In contrast to the broader U.S. South, the Northeast Florida market (FL-1) has lost inventory
and experienced significant price gains.
Source: Timber Mart-South; USDA FIA data; University of Georgia, Wood Demand Report; Rayonier Analysis.
Note: Stumpage price data assumes composite mix of 50% pulpwood, 30% chip-n-saw and 20% sawtimber.
Inventory:
State of decline since 2000
Rate of decline has slowed post-2005
Demand:
Continued decline since 2003
More recently, decline has slowed to ~80% of
the level seen in 2000
Price:
Response associated with housing market peak
in 2005
Recent improvements are driven by competitive
pulpwood markets
60
70
80
90
100
110
120
130
140
Standing Inventory Market Demand Stumpage Price
(indexed in 2000)
Investor Day | November 2016
Regional Market Example: Northern Mississippi
52
Change in Inventory, Demand & Price
Northern Mississippi (MS-1) has seen inventory building since 2000 in excess of the U.S.
South average. Modest improvements in demand have not led to improved timber pricing.
Source: Timber Mart-South; USDA FIA data; University of Georgia, Wood Demand Report; Rayonier Analysis.
Note: Stumpage price data assumes composite mix of 50% pulpwood, 30% chip-n-saw and 20% sawtimber.
Inventory:
Built since 2000 and amplified by recession
Current estimates are well in excess of the U.S.
South average and the market’s historical levels
Demand:
Levels flexed during the housing boom
Recession impacts reduced demand
comparable to the U.S. South
Modest demand increases have occurred since
the trough in 2009
Price:
Has continued to slide since 2004
Recent prices are ~50% of 2000 levels
40
60
80
100
120
140
160
180
Standing Inventory Market Demand Stumpage Price
(Indexed in 2000)
Investor Day | November 2016
Key Implications of Understanding Regional Markets
Markets will not perform in
the same way across the
South
Timber and timberland
returns will vary
significantly among these
regional markets
Investment decisions
should be supported by
local dynamics
53
Capital Allocation
Regional timber market dynamics will result in differential demand growth and ultimately
determine how land management decisions are made and investments perform.
Regime decisions
Harvest timing
Silviculture investments
Land Management
Opportunities exist for new
demand to enter the U.S.
South with attractive timber
product pricing
Supply of grade material is
capable of contributing
significantly to the growing
need for softwood forest
products
Business Development
Investor Day | November 2016
54
Jim Gent
Land Resources
Jeff Lawrence | Director, Real Estate & Land Resources
Investor Day | November 2016
Land Resources – Maximizing Non-Timber Income
55
Any given acre has multiple opportunities, depending on your focus.
Forest Resources
Grow & sell timber
Perpetual revenue
stream
Low capex
Real Estate
Create & sell HBU
Building pipeline of
value & optionality
Opportunistic capex
Land Resources
Incremental use
Enhance gross
margin
Negligible capex
Realizing the value between the trees
Investor Day | November 2016
Land Resources – Diverse Portfolio
Complementary to Timberlands
Complementary to Real Estate
Alternative use to Timberlands
56
Opportunity Type
Diversified cash flow
Multiple geographies
Different risk profiles
Portfolio Approach
RAYONIER
LAND
RECREATION
NATURAL
RESOURCES
LAND USE
INFRASTRUCTURE
Investor Day | November 2016
2012-15:
Focus on Business
Development
2008-11:
Added Dedicated
Resources
Pre-2008:
Ancillary to Forest
Resources
Today:
Land Resources =
Core Business
Dedicated Team
Growth Culture
Value Driven
Land Resources – Evolution of a Growth Culture
57
CAGR
Revenue: 11%
Revenue/ac: 10%
Notes: Excludes New Zealand.
Reflects gross revenue contribution (i.e., before any cost allocation).
3.42
4.57 4.30
4.90
6.04
8.18 7.90
6.87
8.78
10.03
8.78
9.99
–
$5
$10
$15
$20
$25
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Revenue ($MM) Revenue / acre ($)
Investor Day | November 2016
Land Resources – Evolution of Strategy
58
Added Dedicated
Resources
Ancillary to
Forest Resources
Land Resources as Core Business:
Refined Strategy
Growth (minerals)
Steady resource allocation
Foster relationships
Develop growth
Value / Growth Blend (recreation)
Customer service
Broaden customer base
Efficiencies
On-boarding acquisitions
Stable Value (cell towers)
Annuity base
Front-loaded execution
Limited downside risk
Opportunistic growth
Focus on
Business
Development
Stable Value
Value / Growth
Growth
Investor Day | November 2016
Land Resources – Executing the Business
59
Scale
• 23,000 customers
• 4,000 transactions
per year
Diversity
• 45 businesses
• 10 states
Investment
• Human resources
• $0.10 direct cost /
dollar of revenue
• $0 capital
invested over last
five years
$22.5MM
Revenue
or
$9.99/acre
2015
Notes: Excludes New Zealand.
Reflects gross revenue contribution (i.e., before any cost allocation).
Investor Day | November 2016
Land Resources – Poised for the Future
60
Functional business leaders
Straight line from strategy to
execution
Accountable
Dedicated
Team
Entrepreneurial & innovative
Different risk profile
Nimble
Growth
Culture
Asset optimization
Develop annuities
Improve margins
Value Driven
Maximize
Gross Margin
on Every Acre
Investor Day | November 2016
BREAK
61
Investor Day | November 2016
Portfolio Management
Rhett Rogers | Director, Land Asset Management
62
Investor Day | November 2016
63
Never satisfied with portfolio and processes – constantly monitoring, adapting and improving to
create long-term value.
Creating Value Through Active Portfolio Management
Team of experts able to
evaluate complex deals
Assumptions come from
people closest to asset
Collaborative decision
process where each
acquisition / disposition
is debated
Pursue bolt-on and large
strategic acquisitions
Use staged gating
process to efficiently
evaluate acquisitions
Assess risk / reward on
a case-by-case basis
Softwood regions with
tensioned wood baskets
Only enter new markets
when sufficient scale is
possible
Leverage NAV analysis
to understand portfolio
at granular level
Don’t pay for synergies
Consider alternative
uses of capital when
determining value
Sell when others are
willing to pay more than
intrinsic value
Leverage Expertise
Focus on Right
Opportunities
Be DisciplinedBe Nimble
Investor Day | November 2016
Staged Gating Process Streamlines Decision Making
64
Staged gating process gets company focused on right opportunities, ensures alignment, reduces
due diligence expenses and provides for a transparent process to evaluate acquisitions.
Gate A
(1-2 days)
Gate B
(5-10 days)
Gate C
30+ days
Prepare DCF model and inspect property
Assess quality of seller’s data and fit to investment criteria
Does it fit our financial criteria and upgrade the portfolio?
Complete comprehensive due diligence
Develop valuation, pro forma and sensitivity
analysis
Should we make an offer and what are we
willing to pay?
Prepare high level assessment
Assess fit based on size, location, asset quality, age-class profile,
strength of end markets, risks and encumbrances
Is this something we should pursue?
GO
NO GO
GO
NO GO
Investor Day | November 2016
Focus On High-Quality Softwood Properties
Timber end markets with favorable supply / demand tension
Well-developed infrastructure, access to ports and other transportation hubs
65
Softwood investments in regions with strong biological growth
Complementary age-class distribution that improves sustainable harvest
Fee simple ownership; avoid wood supply agreements
Ability to market timber through delivered log or stumpage sales
Ability to enhance returns through intensive silviculture and genetics
Properties with HBU and non-timber income upside potential
Accretive to Cash Available for Distribution (CAD)*
Focus on acquisitions with returns in excess of our cost of capital
Location
Value Creation
Financial Profile
Optionality
Asset Quality
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Investor Day | November 2016
Success Achieved Through Flexible Deal Sourcing
66
Rayonier Value Acquired by Geography (2011-2016YTD) (1)
(1) Value acquired includes acquisition of 39% interest in New Zealand JV for $140 million in 2013 and acquisition of 12% interest in New Zealand JV for $56 million in 2016.
(2) Acres acquired exclude pro rata acres associated with acquisition of New Zealand JV equity interests in 2013 and 2016, respectively.
Acres Evaluated vs. Acquired & Avg. Deal Size (2011-2016YTD) (2)
Key Stats
$1.3 billion acquired
̶ 61% U.S. South
̶ 22% Pacific Northwest
̶ 17% New Zealand
Approximately 1/2 of
value acquired through
direct negotiations
50 transactions, 2.3
million acres evaluated on
average per year
8 transactions, 100K
acres acquired on
average per year
Average transaction size
acquired = 13K acres
–
$100
$200
$300
$400
$500
2011 2012 2013 2014 2015 2016 YTD
U.S. South Pacific Northwest New Zealand
($ in millions)
(acres in 000s)
–
10
20
30
40
50
–
1,000
2,000
3,000
4,000
5,000
2011 2012 2013 2014 2015 2016 YTD
Avg. Size AcquiredAc
res
Ev
alua
ted
Evaluated Acquired Avg. Size Acquired
Investor Day | November 2016
$1.3 Billion Acquired and $680 Million Sold Since 2011
67
+102
+62
-6
+148
+69
-17
-65
-53
317
-74
+61
+4
Note: Map reflects recently announced divestiture of 62,100 acres in Alabama and Mississippi.
-128
Change in Acres by Location Since January 2011 (000 Acres)
Investor Day | November 2016
Portfolio Management Valuation Framework
68
Rayonier employs a rigorous, multi-faceted valuation analysis in arriving at its bid / ask
values for timberland acquisitions / dispositions.
Cost Approach:
Quickest valuation methodology
Current market prices used to
value merchantable timber
Land Expectation Value (LEV)
used to value land and pre-
merchantable timber
Comparable Sales:
Backward looking, but good to
bracket value
Helpful to identify arbitrage
opportunities
DCF Analysis:
Underwriting assumptions
developed by subject matter
experts
Discount rate varies by property
and geography
Sensitivity analysis used to refine
Used to develop initial valuation Used to develop final valuation
Investor Day | November 2016
Key Drivers of Value – Illustrative Examples
69
U.S. South Example – % Change in $ per Acre by Key Value Driver
Timberland value per acre is significantly impacted by productivity (site index) and stumpage
prices. Other major drivers of value include age-class distribution and % productive acres.
Pacific Northwest Example – % Change in $ per Acre by Key Value Driver
60%
70%
80%
60'
70'
80'
$12
$16
$20
8
12
16
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
Site Index (feet) Stumpage Pricing ($/ton) Wtd. Avg. Age % Productive acres
65%
75%
85%
90'
110'
130'
$250
$350
450
15
20
25
-60%
-40%
-20%
0%
20
4
6
Site Index (feet) Stumpage Pricing ($/MBF) Wtd. Avg. Age % Productive Acres
Investor Day | November 2016
Disciplined Acquisition Process = Improved Portfolio
70
Harvest Rate – Tons per Acre per Year (2)
Rayonier seeks to acquire property that improves quality of portfolio and produces strong
recurring cash flow from sustainable harvest.
Productivity – Site Index (1)
Commercial Forest Area – % Productive (3)Weighted Average Plantation Age
Note: Comparison charts reflect data for U.S. legacy per 2014 10-K and acquisitions from 2014 to 3Q 2016.
(1) Site index base age = 25 years for U.S. South and 50 years for Pacific Northwest.
(2) Harvest rate for RYN Legacy assumes sustainable yield of 5.4 to 5.7 million tons for Southern Timber and 1.3 million tons for Pacific Northwest Timber (per 2014 10-K). Harvest rate for
acquisitions based on projected 10-year harvest.
(3) Includes land classified as natural plantable.
72%
85%
68%
77%
50%
60%
70%
80%
90%
100%
U.S. South Pacific Northwest
Acquisitions Legacy
74
122
70
110
50
70
90
110
130
150
U.S. South Pacific Northwest
Acquisitions Legacy
4.8
5.1
2.9
3.5
1.0
2.0
3.0
4.0
5.0
6.0
U.S. South Pacific Northwest
Acquisitions Legacy
16
22
12
19
5
10
15
20
25
U.S. South Pacific Northwest
Acquisitions Legacy
Investor Day | November 2016
Case Study – Menasha Acquisition & Washington Disposition
71
Washington Ownership Map
Rayonier enhanced its Pacific Northwest portfolio through the acquisition of approximately 61,000 acres of
well-stocked, highly productive timberland in Oregon and Washington and the disposition of 55,000 acres of
predominantly pre-merchantable timber in Washington.
Oregon Ownership Map
Investor Day | November 2016
PNW Portfolio Repositioning Improves Age Class Profile
72
Pro Forma Pacific Northwest Age Class Profile
As a result of the Menasha acquisition and the Washington disposition, Rayonier’s Pacific
Northwest age-class profile is significantly improved and more evenly distributed.
(1) Acres exclude non-operable and non-commercial acres.
Net Change in Operable Acres by Age Class
–
10,000
20,000
30,000
40,000
50,000
60,000
70,000
A
c
re
s
(
1
)
Age-Class
Residual RYN Menasha Acquisition Washington Disposition
(12,000)
(10,000)
(8,000)
(6,000)
(4,000)
(2,000)
–
2,000
4,000
6,000
8,000
Ch
a
n
g
e
i
n
A
c
re
s
(
1
)
Age-Class
Investor Day | November 2016
Pacific Northwest Harvest Profile
73
Sustainable Yield (1) – Legacy to Pro Forma Bridge
Acquisition of well-stocked, productive timberland coupled with disposition of predominantly pre-
merchantable timberland expected to increase both near-term harvest and long-term sustainable yield.
(1) “Sustainable yield” is defined in the Company’s latest report on Form 10-K.
5-Year Avg. Harvest – Legacy to Pro Forma Bridge
(MMBF) (MMBF)
25
38
165
178
–
20
40
60
80
100
120
140
160
180
200
Legacy Disposition Acquisition Pro Forma
9
40
130
161
–
20
40
60
80
100
120
140
160
180
200
Legacy Disposition Acquisition Pro Forma
79%
90%
Investor Day | November 2016
Net Impact = Higher Quality Portfolio, Improved Sustainable Harvest
74
Productivity
The net impact of the Menasha acquisition and Washington disposition is an improved
timberland portfolio with more stable cash flow from sustainable timber harvest.
(1) Productivity based on “sustainable yield,” as defined in the Company’s latest report on Form 10-K.
% Productive Acreage
Merchantable Inventory – % Douglas-firMerchantable Inventory per Gross Acre
(board feet per acre per year)
(MBF per gross acre) (% Douglas-fir)
(operable acres / total acres)
76% 75%
85%
78%
50%
60%
70%
80%
90%
Legacy Disposition Acquisition Pro Forma
44%
28%
83%
58%
–
20%
40%
60%
80%
100%
Legacy Disposition Acquisition Pro Forma
440 455
625
470
–
200
400
600
800
Legacy Disposition Acquisition Pro Forma
1.8
0.8
5.3
2.5
–
1.0
2.0
3.0
4.0
5.0
6.0
Legacy Disposition Acqui iti n Pro Forma
Investor Day | November 2016
Real Estate
Chris Corr | Senior Vice President, Real Estate & Public Affairs
Charles Adams | Vice President, Community Development
75
Investor Day | November 2016
Rayonier is now executing a disciplined and focused Real Estate strategy with the experience
and capabilities required to create long term value.
Building culture
Building strategy
Building capabilities
Focus, disciplined
execution
Ownership and empowerment
True transparency, industry leading
“One Rayonier” – collaboration drives value
Portfolio-wide, asset and market specific
Market-informed, granular analysis
De-emphasize “non-strategic” timberland sales
Maximize opportunity and create optionality
Project management
Marketing
Real Estate
Market + process driven
Capex paced with sales
Maintain flexibility
Just getting started
Post-spin Strategic Reboot
76
Investor Day | November 2016
Maximize and grow annual gross margin/ac
Build diverse portfolio of cash flows
Develop new business growth
Strategic Framework: Maximize Opportunity and Create Optionality
Timberlands Real Estate
Sale of properties with
development rights
Invest in securing
development rights
Build a pipeline of
entitled properties in
higher potential
markets
HBU premium + ROI
Grow in
select markets
Sale of rural
properties
Grow and sustain
recurring cash flows
Build a pipeline of
enhanced rural
properties in higher
potential markets
HBU premium + ROI
Grow moderately
Strategic sales of
timberland
Opportunistic-only for
capital allocation
Upgrade portfolio
Excluded from Adj.
EBITDA and pro-
forma financials
Timberland value
Opportunistic
Land
Resources
Sale of non-strategic and
timberland assets
Timberland: capture a
financial premium
Non-Strategic:
monetize and
repurpose “dead-
capital”
Timberland premium
Reduce reliance
Non-Strategic /
Timberlands
Rural Places +
Properties
Unimproved
Development
Sale of developed
land parcels
Invest in infrastructure
and amenities
Enhance value and
create optionality of
adjacent RYN
properties
HBU premium + ROI
+ optionality
Grow in
very select markets
Improved
Development
Large
Dispositions
Sale of
access to use
properties /
extract
resources
Annual
gross
margin
per acre
Grow
moderately
77
Investor Day | November 2016
Making Progress and Just Getting Started: YTD(1) Highlights
Timberlands Real Estate
Land
Resources
Non-Strategic /
Timberlands
Rural Places +
Properties
Unimproved
Development
Improved
Development
Large
Dispositions
78
3,000+ agreements closed across the U.S.
Centralized strategy and objectives, integrated team
Sold 2 properties
(121 ac) for $2.2MM
($18,302/ac)
Secured land use
entitlements for 1
property (86 ac)
Advanced land use
entitlements process
for 3 properties
(2,529 ac)
Places:
• 63 lots enhanced
• 185 lots under
development
• 9 lots (104 ac)
sold for $4,907/ac
Properties:
• 6,201 ac sold
for $17.1MM
($2,762/ac)
PNW:
~55,000 ac sold,
~61,000 ac acquired
U.S. South:
~37,000 ac sold,
~45,000 ac acquired
Non-Strategic:
8,631 ac sold for
$9.4MM ($1,090/ac)
Conservation /
Timberland:
816 ac sold for
$5.3MM ($6,495/ac)
Townsend Bombing
Range (GA)
17,772 ac sold for
$48.3MM ($2,720/ac)
2 active projects:
• FL: 261 net ac
mixed-use
• GA: 970 net ac
industrial (33 net ac
sold in 2016)
2 projects under
evaluation:
• GA: ~370 net ac
residential
• FL: TBD net ac
resort residential
(1) 2016YTD figures through 10/31/2016. (2) Portion of 62,100-acre sale announced Q32016 that closed in October 2016. (3) Sold under threat of condemnation.
(4) 140 net acres sold project to date. Current project net acres are 830 ac = 970 ac – 140 ac.
(4)
(2)
(3)
Investor Day | November 2016
$2,309 $2,675
$13,771
Non- Strategic /
Timberlands
Rural Development
Making Progress and Just Getting Started: Price Growth
2011-14 Price per Acre
Rayonier has realized stronger pricing on real estate sales since 2015. Excluding “large
dispositions” Rayonier’s real estate sales are focused on HBU properties.
Note: Price per acre based on weighted average sales price over the periods shown.
(1) Price per acre for NS / Timberlands excludes Large Dispositions (see Appendix for definition).
(2) 2016YTD sales through 10/31/2016.
2015-16 YTD Price per Acre
($ per acre) ($ per acre)
(1)
(1)
+20%
+90%
79
(2)
$1,854 $2,222
$7,259
Non- Strategic /
Timberlands
Ru l Development
Investor Day | November 2016
Disciplined, Market and Asset Focused Strategy: Four Examples
Rural Places | 1
I-95 Coastal Corridor | 2
Unimproved Development | 3
Wildlight | 4
80
Investor Day | November 2016
Rural: Distinct Properties for Residential and Recreation
Create a sustainable pipeline of market-ready properties across multiple markets and return
an HBU premium by selling market-targeted, enhanced parcels to end users.
YTD 10/31/2016 Houston Lake Charles Jacksonville
Sold (lots | $/ac) 2 | $7,500 1 | $3,501 6 | $3,235
Complete (lots) 14 14 35
In-progress (lots) 55 48 82
Under evaluation (acres) ~2,000 ~1,000 ~5,000
81
Star Ridge (Polk Co. TX)
Note: Figures shown in table above are 2016YTD through 10/31/2016.
Investor Day | November 2016
I-95 Coastal Corridor: Unlocking HBU Value
In 2014 we undertook an extensive evaluation of ~200,000 acres in the I-95 Coastal Corridor
stretching approx. 200 miles between Daytona Beach, FL and Savannah, GA.
2
0
0
MI
L
E
S
= Rayonier landholdings
Land Analysis
Market Analysis
Regulatory Analysis
Identification of Planning
Areas
Case Studies / Scenarios
Land Capacity Analysis
Financial Modeling
Market Catalyst Strategies
82
Investor Day | November 2016
I-95 Coastal Corridor: Active Portfolio Management
BRYAN COUNTY – US 17
RICHMOND HILL 1
KILKENNY
RICHMOND HILL 2
2014/15/16
2014/15
2014/15
EAST NASSAU NORTHERN
WEST NASSAU 3
ST MARYS BLUFF’S
ST MARYS / EXIT 1 GA
EAST NASSAU REMAINDER
CRAWFORD DIAMOND
EAST NASSAU SOUTHERN
WEST NASSAU 1
WEST NASSAU 2
2014/15
SOUTH ST. JOHNS 1
ST. JOHNS COUNTY REMAINDER
SOUTH ST. JOHNS 2
I-95 / US1 INTERCHANGE
PEDRO MENENDEZ
PELLICER CREEK
NEOGA LAKES
2014/16
2014/16
2014/16
2014
2014
2014/16
2014/16
2014
2014
2014
2014
2014/15/16
2014
2014/16
2014
2014
BELFAST COMMERCE PARK
RICHMOND HILL 3
CRANDALL
CHESTER RD.
EAST NASSAU DSAP
NORTH ST. JOHNS
BELFAST Commerce Park – 830 ACRES
BELFAST Mixed Use
EAST NASSAU Residential / Hospitality
CHESTER RD. – 1,202 ACRES
WILDLIGHT – 261 ACRES
NORTH ST. JOHNS – 1,670 ACRES
83
Active projects (Improved)
Other Rayonier properties
Rayonier planning areas
Active projects (Unimproved)
Under evaluation
Optimize timberland value
as of 10/31/2016
Investor Day | November 2016
Land Use Entitlements Pipeline
84
Create a sustainable pipeline of market-ready properties with HBU development rights and
return an HBU premium through sales to developers and homebuilders.
(1) Figures shown as of 10/31/2016.
(2) Acres shown are net acres; all other acres shown are gross.
Wildlight FL res | com | ind 261 ac 972 u 0.6
Belfast Commerce GA | ind 830 ac 14.5
TOTAL 1,091 ac 972 u 15.1 MMSF
SOLD (LTM) $3.5 86 ac 0.6 MMSF
Belfast Residential GA res | 2,360 ac 9,650 u
Belfast Commerce GA res | com | ind 990 ac 950 u 3.2
Kilkenny GA res | 3,340 ac 4,850 u 0.2
Kingsland GA res | com | ind 14,900 ac 40,000 u 23.0
Crawford Diamond FL | ind 1,810 ac 10.5
E. Nassau, balance FL res | com | ind 22,530 ac 21,150 u 10.3
Neoga Lakes FL res | com | ind 6,410 ac 7,000 u 2.5
TOTAL 52,340 ac 83,600 u 49.7 MMSF
Entitlements complete (on the market)
1,091 972 15.1
net residential non-residential
acres units mmsqft
Active
projects
(Improved)
343 336 0.2
net residential non-residential
acres units mmsqft
North St. Johns Co #4 FL res | 257 ac 336 u
North St. Johns Co #5 FL | com | 86 ac 0.2
TOTAL 343 ac 336 u 0.2 MMSF
SOLD (LTM) $2.2 121 ac 110 u
2,529 3,143 0.6
gross residential non-residential
acres units mmsqft
East Nassau, Chester FL res | com | 1,202 ac 1,875 u 0.1
North St. Johns Co #6 FL res | com | 551 ac 450 u 0.3
North St. Johns Co #7 FL res | com | 776 ac 818 u 0.2
TOTAL 2,529 ac 3,143 u 0.6 MMSF
52,340 83,600 49.7
gross residential non-residential
acres units mmsqft
Active
projects
(Unimproved)
Entitlements in-progress (market ready)
Active
projects
(Unimproved)
Entitlements complete (limited near-term market)
Managed to
optimize
timber value
(2)
(1)
Investor Day | November 2016
Unimproved Development : St. Johns Co, FL
Closed
1. 217 ac $17,000/ac (2015)
2. 48 ac $18,000/ac (2016)
3. 73 ac $18,500/ac (2016)
Land Use Entitlements Complete
4. 257 ac residential
5. 86 ac commercial
Land Use Entitlements In-Progress
6. 551 ac residential | commercial
7. 776 ac residential | commercial
85
Investor Day | November 2016
Jacksonville MSA: 1,450,000
(2015 US Census Estimate)
86
Local Context: NE Florida Growth Momentum Shifting North
Investor Day | November 2016
An Active Regional Economy
Established Anchors:
Downtown Jacksonville,
Jacksonville Int’l Airport,
Port of Jacksonville
Kings Bay Naval Base
Amelia Island + Resort
Diverse / Growing Sectors:
Industrial + Manufacturing
Shipping + Distribution
Professional + Back Office
Retail + Commercial
Hospitality and Tourism
Healthcare
Residential
Local Context: Significant Regional Development
87
Investor Day | November 2016
Local Context: Growing Market
3,381 3,245
4,582
6,276 6,306
7,242
251
309 305
481
545
786
-
100
200
300
400
500
600
700
800
900
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2010 2011 2012 2013 2014 2015
Single Family Building Permits
Source: U.S. Census.
Nassau Share: 7.4% 9.5% 6.7% 7.7% 8.6% 10.9%
Jacksonville MSA
Nassau County
88
Investor Day | November 2016
The East Nassau Community
Planning Area comprises 24,000
acres currently zoned for future
development.
Site Location: ~24,000 Acres with Approved Zoning
89
Investor Day | November 2016
Wildlight Master Plan: Generalized Development Plan
90
Investor Day | November 2016
91
Wildlight Master Plan: A 10 Year Program
Investor Day | November 2016
Financial Overview
Mark McHugh | Senior Vice President & Chief Financial Officer
92
Investor Day | November 2016
Objective
Provide investors with detailed and
transparent information to better
understand our business and make
informed investment decisions
Disclosure Philosophy
93
Rayonier strives to provide best-in-class disclosure and transparency for our investors.
Key financial information and metrics
Volumes and prices by major product category
Non-timber income and major cost categories
Segment Disclosure
Productivity – site index, % plantable, sustainable yield
Detailed inventory and age-class data
Qualitative information on key regional markets
Asset Disclosure
Provide information that is pertinent to investors
Exclude Large Dispositions from Adjusted EBITDA
Detailed disclosure on acquisitions and dispositions
Transparency
Investor Day | November 2016
Rayonier Financial Summary: 2013 – 2016 YTD (9/30)
94
Pro Forma Sales*
Rayonier has historically generated strong Adjusted EBITDA* margins and high Adjusted
EBITDA-to-free cash flow conversion.
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Adjusted EBITDA* / % Margin
(Adj. EBITDA – Capex) / % of Adj. EBITDACapital Expenditures
($ in millions)
($ in millions)
($ in millions) (% of pro forma sales)
($ in millions) (% of Adj. EBITDA)
$580 $582
$545
$438
–
$100
$200
$300
$400
$500
$600
$700
2013 2014 2015 2016 YTD
$194
$214 $208
$188
10%
20%
30%
40%
50%
60%
–
$50
$100
$150
$200
$250
2013 2014 2015 2016 YTD
$63 $64
$57
$40
–
$20
$40
$60
$80
2013 2014 2015 2016 YTD
$131
$150 $151 $148
50%
60%
70%
80%
90
–
$50
$100
$150
$200
2013 2014 2015 2016 YTD
Investor Day | November 2016
Low-Cost Debt Structure & Attractive Maturity Profile
95
Rayonier has low-cost, primarily fixed-rate debt and a well-staggered maturity profile.
Maturity Profile
Highlights
Average rate of 3.25%
96% fixed-rate debt
Average maturity of over
7 years
Highlights
Well-staggered maturity
profile
Nearest significant
maturity in 2022
No significant stacked
maturities
Debt Profile Balance @ Interest Annual Years to
($ in millions) 9/30/2016 Rate Interest % Fixed Maturity (1)
Senior Notes due 2022 $325.0 3.75% $12.2 100.0% 5.5
Term Loan due 2024 (2) 350.0 3.33% 11.7 100.0% 7.9
Incremental Term Loan due 2026 (3) 300.0 2.82% 8.5 100.0% 9.6
Mortgage Notes due 2017 31.8 4.35% 1.4 100.0% 0.8
Revolving Credit Facility due 2020 (4) 25.0 1.80% 0.8 – 3.8
Solid Waste Bond due 2020 15.0 2.10% 0.3 – 3.6
NZ Working Capital Facility due 2017 – 2.80% – – 1.0
NZ Shareholder Loan (5) 22.0 NA NA NA NA
Total / Weighted Avg. $1,068.8 3.25% $34.8 96.2% 7.2
(1) As of 9/30/16; NZ w orking capital facility represents average maturity of tw o tranches; w eighted average excludes NZ shareholder loan.
(2) Includes impact of inter st rate sw aps and estimated patronage payments.
(3) Assumes $200mm at 2.93% and $100 million at 2.59%; includes impact of interest rate sw aps and estimated patronage payments.
(4) Interest on revolver includes unused facility fee of 0.175%.
(5) Minority share of New Zealand shareholder loan; does not represent third-party indebtedness.
–
$100
$200
$300
$400
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027+
($ in millions)
Investor Day | November 2016
Investment Grade Ratings & Strong Credit Metrics
Current Credit Ratings
S&P: BBB- / Stable
Moody’s: Baa3 / Stable
Credit Highlights
Strong Adj. EBITDA* margins
High EBITDA-to-FCF conversion
Significant asset coverage
Credit Ratio Targets
Committed to maintaining an investment
grade credit profile
Target credit metrics include:
̶ Net Debt / Adj. EBITDA: ~4.5x area
̶ Net Debt / Asset Value: < 30%
96
Credit Highlights & Ratio Targets
Rayonier has a strong, investment grade credit profile with significant asset coverage.
(1) Enterprise value based on market capitalization plus net debt as of 9/30/2016.
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Capital Structure & Credit Statistics
9/30/2016
Senior Notes due 2022 $325.0
Term Loan due 2024 350.0
Incremental Term Loan due 2026 300.0
Other Debt 93.8
Total Debt $1,068.8
(–) Cash (110.0)
Net Debt $958.7
Shareholders' Equity 1,361.2
Net Capitalization (book) $2,319.9
Credit Data
LTM Adjusted EBITDA* $235.4
Pro Forma Interest Expense* 34.8
Credit Statistics
Net Debt / Adj. EBITDA 4.1x
Adj. EBITDA / Interest Expense 6.8x
Net Debt / Net Capitalization 41.3%
Net Debt / Enterprise Value (1) 22.7%
Investor Day | November 2016
Adjusted EBITDA* by Segment: 2013 – 2016 YTD
97
Adjusted EBITDA* by Segment
Recent strength in the Real Estate and New Zealand Timber segments has offset harvest
deferrals in the Pacific Northwest and Southern Timber segments.
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Adjusted EBITDA* by Segment (% of Total)
Corporate ($45) ($31) ($20) ($14)
$87
$98 $101
$72
$54
$51
$22
$14
$38
$46
$33
$41
$58
$48
$71
$74
$194
$214
$208
$188
–
$50
$100
$150
$200
$250
$300
2013 2014 2015 2016 YTD
Southern Pacific Northwest New Zealand Real Estate Trading
($ in millions) (% of total Adj. EBITDA)
Corporate ($45) ($31) ($20) ($14)
36%
40%
44%
36%
23%
21% 10%
7%
16%
19%
14%
20%
24%
20%
31%
37%
–
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2014 2015 2016 YTD
Southern Pacific Northwest New Z aland Real Estate Trading
Investor Day | November 2016
EBITDA* Margin Varies by Segment
98
EBITDA* Margin by Segment: 2013 – 2016 YTD (9/30)
Rayonier’s EBITDA* margin varies considerably by segment due to different cost structures
and marketing strategies (e.g., delivered vs. stumpage).
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
–
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2014 2015 2016
YTD
2013 2014 2015 2016
YTD
2013 2014 2015 2016
YTD
2013 2014 2015 2016
YTD
2013 2014 2015 2016
YTD
2013 2014 2015 2016
YTD
Consolidated Southern Pacific Northwest New Zealand Real Estate Trading
Consolidated Avg.
38%
Southern Avg.
71%
New Zealand Avg.
26%
Real Estate Avg.
86%
Trading Avg.
2%
Pacific NW Avg.
38%
Investor Day | November 2016
Rayonier is the Leading “Pure Play” Timber REIT
99
Peer Group EBITDA* Composition
(2013-15 Average)
Over the past three years, Rayonier has generated 74% of its EBITDA* from timber operations
(versus 51% for the peer group).
Note: Timberland REIT Peer Group comprised of WY (legacy), PCL (legacy), PCH and CTT. Figures reflect aggregate Timberland REIT Peer Group 2013-2015 EBITDA
excluding corporate expenses. Other includes real estate, manufacturing and other reported segments. WY (legacy) excludes divested Cellulose Fibers business.
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Peer Group
2013-15 EBITDA*
Composition
Rayonier
2013-15 EBITDA*
Composition
Timber
Segments
51%
Other
49% 74%
54%
42%
50%
59%
25%
7%
43%
20%
16%
38%
15%
30%
25%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
RYN WY
(legacy)
PCL
(legacy)
WY / PCL
(pro forma)
PCH
Timber Real Estate Manufacturing / Other
Timber
Segments
74%
Other
26%
Investor Day | November 2016
Timberland EBITDA* / Cash Flow Volatility Is Very Low
100
Historical U.S. Timberland Segment EBITDA* Margins
Timberland operations generally yield high EBITDA* margins with very low volatility.
(1) Calculated as ratio of standard deviation to average.
* Non-GAAP measure or pro forma item (see Appendix for definitions and RYN reconciliations).
Margin Volatility / Coefficient of Variation (1)Avg. Timberland EBITDA* Margin (2004-15)
–
10%
20
30%
40
50%
60
70%
80
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Rayonier Weyerhaeuser Plum Creek Potlatch
62%
30%
36% 34%
–
10%
20%
30%
40%
50%
60%
70%
Rayonier Weyerhaeuser Plum Creek Potlatch
Average = 40%
14%
12%
18%
15%
–
5%
10%
15%
20%
Rayoni Weyerhaeuser Plum Creek Potlatch
Average = 15%
Investor Day | November 2016
Manufacturing EBITDA* / Cash Flow Volatility Is Very High
101
Historical Wood Products Segment EBITDA* Margins
Wood products manufacturing generates much lower EBITDA* margins and is highly volatile
relative to timberlands.
Note: Rayonier Wood Products segment reflects legacy business divested in 2013.
(1) Calculated as ratio of standard deviation to average.
* Non-GAAP measure or pro forma item (see Appendix for definitions and RYN reconciliations).
Margin Volatility / Coefficient of Variation (1)Avg. Wood Products EBITDA* Margin (2004-15)
5%
3%
11%
8%
–
2%
4%
6%
8%
10%
12%
Rayonier Weyerhaeuser Plum Creek Potlatch
Average = 7%
204%
306%
52%
101%
–
50%
100%
150%
200%
250%
300%
350%
Rayonier Weyerhaeuser Plum Creek Potlatch
Average = 166%
(15%)
(10 )
(5%)
–
5%
10
15%
20
25%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Rayonier Weyerhaeuser Plum Creek Potlatch
Investor Day | November 2016
Rayonier Leads the Sector In U.S. South EBITDA* / Ton
102
U.S. South EBITDA* / Ton
Rayonier’s sector-leading EBITDA* per Ton has increased by over 50% in the last five years,
while its rate of harvest has remained relatively stable.
Source: WY EBITDA based on Sept-2016 Investor Presentation, excluding PCL contribution; PCH EBITDA based on data provided in Q2-2016 Earnings Supplement; PCL EBITDA
based on historical public filings. Volume and acreage data for all peers based on historical public filings; assumes 1.22 tons per cubic meter for WY.
* Non-GAAP measure or pro forma item (see Appendix for definitions and RYN reconciliations).
U.S. South Rate of Harvest U.S. South EBITDA* / Acre
EBITDA* per ton best captures profitability per unit of sales
EBITDA* per acre can be misleading due to differential rates of harvest
($ per ton harvested) (tons per acre per year) ($ per acre)
$5
$10
$15
$20
2011 2012 2013 2014 2015
RYN WY PCL PCH
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2011 2012 2013 2014 2015
RYN WY PCL PCH
$10
$20
$30
$40
$50
$60
$70
2011 2012 2013 2014 2015
RYN WY PCL PCH
Investor Day | November 2016
–
$250
$500
$750
$1,000
$1,250
$1,500
$1,750
$2,000
U.S. South Historical Valuation Snapshot
103
U.S. South EBITDA per Acre (NCREIF)
U.S. South timberlands have traded at an average EBITDA multiple (excluding land sales) of
~36x over the last 25 years.
Source: National Council of Real Estate Investment Fiduciaries.
U.S. South Value per Acre (NCREIF)
U.S. South EBITDA Multiples (NCREIF)
–
10x
20x
30x
40x
50x
60x
Average = 36.4x
–
$5
$10
$15
$20
$25
$30
$35
$40
$45
$50
Investor Day | November 2016
Rayonier’s Northwest EBITDA* / Ton Has Declined
104
Northwest EBITDA* / Ton
Rayonier’s Northwest EBITDA* per ton is below the peer group, due its the historical proportion of
hemlock volume (vs. Douglas-fir) and, more recently, due to its reduced rate of harvest.
Source: WY EBITDA (not including PCL) based on June 2016 Investor Presentation; Pope EBITDA based on historical public filings. Volume and acreage data for all peers based
on historical public filings; assumes 0.95 tons per cubic meter for WY and 8.0 tons per MBF for Pope.
* Non-GAAP measure or pro forma item (see Appendix for definitions and RYN reconciliations).
Northwest Rate of Harvest Northwest EBITDA* / Acre
Following November 2014 announcements, Rayonier reduced its rate of harvest in the Northwest
EBITDA* per ton and EBITDA* per acre have both declined as a result
($ per ton harvested) (tons per acre per year) ($ per acre)
$10
$20
$30
$40
$50
$60
2011 2012 2013 2014 2015
RYN WY Pope
$50
$100
$150
$200
$250
2011 2012 2013 2014 2015
RYN WY Pope
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
2011 201 2013 2014 2015
RYN WY Pope
Investor Day | November 2016
–
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
–
20x
40x
60x
80x
100x
Northwest Historical Valuation Snapshot
105
Northwest EBITDA per Acre (NCREIF)
Northwest timberlands have traded at an average EBITDA multiple (excluding land sales) of
~21x over the last 25 years, but have traded at higher multiples more recently.
Source: National Council of Real Estate Investment Fiduciaries.
(1) Value per acre negatively impacted in 2012 by addition of large portfolio of lower value acreage in Eastern Washington and Oregon.
Northwest Value per Acre (NCREIF) (1)
Northwest EBITDA Multiples (NCREIF)
Average = 20.8x
–
$50
$100
$150
$200
$250
Investor Day | November 2016
Financial Overview – Key Takeaways
106
Disclosure
Portfolio Mix
Performance
Balance Sheet
Valuation
Leading the industry with best-in-class disclosure
Committed to transparent investor communications
Low cost of debt with staggered maturity profile
Strong / stable margins, high FCF conversion and significant asset coverage
NAV approach necessitates deeper understanding of underlying asset values
̶ $/acre and EBITDA multiple-based metrics are overly simplistic for the asset
Working with the investment community to upgrade disclosure and facilitate a more
comprehensive understanding of timberland values
Leading the peer group in U.S. South EBITDA* per ton
Focused on continuous improvement and efficiency to grow cash flow
Pure-play focus mitigates exposure to volatile manufacturing operations
Focused on growing cash flow from recurring timber and real estate operations
* Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Investor Day | November 2016
Closing Remarks and Q&A
Dave Nunes | President & Chief Executive Officer
107
Investor Day | November 2016
Rayonier Represents an Attractive Investment Opportunity
Steady improvement in
housing starts projected
over next few years
Favorable supply
dynamics relative to last
peak in housing starts
driven by decline in
Canadian supply
Demand from China that
was not present during
last housing start peak
Geographic market
diversification across
strong timber markets in
U.S. South, Pacific
Northwest, and New
Zealand
Superior pricing in U.S.
South based on
tensioned wood baskets
Advantageous real
estate platform with
projects underway in
FL/GA coastal regions
Higher proportion of
cash flows from
recurring timber harvest
operations vs. peer
group
Dividend level
established and
supported without
overreliance on sales of
core timberlands
Industry leader in
transparent investor
communications
Significant decline in
share value following Q3
2014 earnings release
and related
announcements
Currently trading at
discount to estimated
net asset value
108
Timber Asset Class
Poised for Growth
Strategies to Deliver
Sustainable Results
Discount to
Underlying Asset
Value
Rayonier Uniquely
Positioned
Investor Day | November 2016
APPENDIX
109
Investor Day | November 2016
Biographies
110
David L. Nunes | President and CEO Service since: 2014
Mr. Nunes has more than three decades of forest products industry experience. He has served in key
leadership positions at several timber and real estate companies, including CEO and president, and has
substantial background in the areas of timberland management and investments, marketing, strategic
planning, mergers and acquisitions and capital planning.
Douglas M. Long | SVP, U.S. Operations Service since: 1995
Mr. Long joined Rayonier in 1995 as a GIS Forestry Analyst, and has held multiple positions of increasing
responsibility within the forestry division. From 2003-2007, he was a Forest Services Manager and a
Regional Manager in Rayonier’s New Zealand operations. In 2007, he returned to the U.S., where he
served as Southwest Resource Unit Leader.
Christopher T. Corr | SVP, Real Estate and Public Affairs Service since: 2013
Mr. Corr joined Rayonier in 2013. Prior to joining, he served as Executive Vice President, Buildings and
Places for AECOM, a global provider of technical and management support services, including real estate
planning and development. Chris previously served as Executive Vice President and Chief Strategy Officer
of The St. Joe Company. He was also an executive at The Walt Disney Company.
Mark McHugh | SVP and CFO Service since: 2014
Mr. McHugh has 16 years of experience in finance and capital markets focusing on the timberland and
REIT sectors. Mark joined Rayonier from Raymond James, where he served as Managing Director in the
firm’s Real Estate Investment Banking group, responsible for the firm’s timberland and agriculture sector
coverage.
Paul Nicholls | Managing Director, Rayonier NZ Service since: 1993
Mr. Nicholls has the overall responsibility for the management of the RMF assets and along with the
development and implementation of the strategic direction of the business. He has 35 years’ experience as
forest industry expert in New Zealand and Australia. Paul has travelled extensively throughout Asia with a
strong understanding of the key markets in China, Korea and India.
Investor Day | November 2016
Biographies (cont.)
111
Jim Gent, A.D. | Director, Research & Silviculture Service since: 2006
Dr. Gent joined Rayonier in 2006 as Manager, Forest Productivity and Technology. In 2010, he was named
Manager, Research and Silvicultural support, with responsibility for directing Rayonier’s silviculture and
tree improvement initiatives, fertilization and weed control services, growth and yield analysis and
regeneration activities. He was promoted to his current position in 2013.
Jeff Lawrence | Director, Real Estate & Land Resources Service since: 1998
Mr. Lawrence joined Rayonier as a Research Forester in 1998, and progressed through roles of increasing
responsibility including, District Technical Forester and Land Utilization Manager, developing the early
stages of the rural land sales program. In 2003, he was promoted to Land Projects Manager, and in 2005
was named Project Manager for TerraPointe Services (now Raydient). In 2012, Jeff was promoted to
Senior Manager, Business Development, and was promoted to his current position in 2014.
Vernon Hiott | Manager, Business Development Service since: 2006
Mr. Hiott joined Rayonier in 2006 as a Silvicultural Operations Forester overseeing fertilization and other
forest activities across Rayonier properties in Alabama, Georgia and Florida. In 2007, he was promoted to
Business Development Analyst, focusing on timberland transaction due diligence, strategic planning, timber
market analysis and price forecasting. He was promoted to his current position in October 2011.
Rhett Rogers | Director, Land Asset Management Service since: 2001
Mr. Rogers has 15 years of experience in forest operations, land sales, acquisitions, dispositions and
strategic planning. He joined Rayonier in 2001 as a District Technical Forester, and has held numerous
roles of increasing responsibility, most recently as Manager, Land Acquisitions. He was promoted to his
current position in August 2014.
Charles Adams | Vice President, Community Development Service since: 2015
Mr. Adams joined Rayonier in 2015 to lead the newly formed Community Development Division. He has
over 25 years of real estate development, finance and management experience. Prior to joining Rayonier,
he served as Managing Partner of Celebration Associates, LLC, a developer and advisor of key successful
master-planned projects across the U.S., Mexico and Caribbean such as Baxter, NC.
Investor Day | November 2016
Definitions of Non-GAAP Measures and Pro Forma Items
Pro Forma Sales is defined as revenue adjusted for Large Dispositions. Rayonier believes that this non-GAAP financial measure provides
investors with useful information to evaluate our core business operations because it excludes specific items that are not indicative of ongoing
operating results.
Adjusted EBITDA is defined as earnings before interest, taxes, depreciation, depletion, amortization, the non-cash cost of land and improved
development, Costs related to shareholder litigation, Gain on foreign currency derivatives, Large Dispositions, internal review and restatement
costs, costs related to spin-off of the Performance Fibers business, the gain related to the consolidation of the New Zealand JV and
discontinued operations. Adjusted EBITDA is a non-GAAP measure that management uses to make strategic decisions about the business
and that investors can use to evaluate the operational performance of the assets under management. It removes the impact of specific items
that management believes do not directly reflect the core business operations on an ongoing basis.
EBITDA by segment is calculated as operating income less depreciation, depletion, amortization and specific items that are not indicative of
ongoing operating results. EBITDA by segment for Rayonier is equal to Adjusted EBITDA.
Last twelve months (LTM) Adjusted EBITDA is a non-GAAP financial measure that Rayonier believes provides investors with useful
information to evaluate the Company's ability to service its debt. For purposes of this calculation LTM Adjusted EBITDA is used as an indicator
of the Company's performance over the most recent twelve months and debt net of cash is presented as an indicator of Rayonier’s current
leverage.
Pro Forma Interest Expense is calculated as Rayonier’s current run rate of interest on outstanding indebtedness as of September 30, 2016,
and assumes that the Company issues no additional debt. This estimate could vary widely depending upon future financing activities.
Cash Available for Distribution (CAD) is defined as cash provided by operating activities adjusted for capital spending (excluding timberland
acquisitions and spending on the Rayonier office building) and working capital and other balance sheet changes. CAD is a non-GAAP
measure that management uses to measure cash generated during a period that is available for dividend distribution, repurchase of the
Company's common shares, debt reduction and strategic acquisitions. CAD is not necessarily indicative of the CAD that may be generated in
future periods.
Costs related to shareholder litigation is defined as expenses incurred as a result of the securities litigation, the shareholder derivative
demands and the Securities and Exchange Commission investigation. See Note 10—Contingencies of Item 8 — Financial Statements and
Supplementary Data in the Company’s most recent Annual Report on Form 10-K.
Gain on foreign currency derivatives is the gain resulting from the foreign exchange derivatives the Company used to mitigate the risk of
fluctuations in foreign exchange rates while awaiting the capital contribution to the New Zealand JV.
Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have any identified
HBU premium relative to timberland value.
112
Investor Day | November 2016
Reconciliation of Net Debt and LTM Adjusted EBITDA
113
($ in millions) 2016
(9/30)
Current maturities of long-term debt $31.8
Long-term debt, net of deferred financing costs 1,033.3
Deferred financing costs 3.7
Total Debt $1,068.8
Cash and cash equivalents (110.0)
Net Debt $958.7
($ in millions) Q4 Q1 Q2 Q3 Q3
2015 2016 2016 2016 2016 LTM
Net income $9.4 $15.1 $111.6 $40.6 $176.7
Interest, net 5.8 8.7 7.7 8.3 30.5
Income tax expense (benefit) 0.5 (0.8) 2.3 0.8 2.8
Depreciation, depletion and amortization 27.9 29.3 22.4 32.0 111.6
Non-cash cost of land and improved development 3.0 4.1 1.7 4.3 13.1
Costs related to shareholder litigation (1) 1.0 0.4 0.6 1.2 3.2
Gain on foreign currency derivatives (1) - (1.2) - - (1.2)
Large Dispositions (1) - - (101.3) - (101.3)
Adjusted EBITDA (1) $47.6 $55.6 $45.0 $87.2 $235.4
Net Debt / Adjusted EBITDA (1) 4.1x
(1) Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Investor Day | November 2016
Reconciliation of Net Income to Adjusted EBITDA
114
($ in millions) 2016 2015 2014 2013
YTD (9/30)
Net income $167 $44 $98 $374
Interest, net 25 35 50 38
Income tax expense (benefit) 2 (1) (10) (36)
Depreciation, depletion and amortization 84 114 120 117
Non-cash cost of land and improved development 10 13 13 10
Costs related to shareholder litigation (1) 2 4 - -
Gain on foreign currency derivatives (1) (1) - - -
Large Dispositions (1) (101) - (21) (26)
Cost related to spin-off of the Performance Fibers business (1) - - 4 -
Internal review and restatement costs (1) - - 3 -
Discontinued operations (1) - - (43) (268)
Gain on consolidation of New Zealand JV (1) - - - (16)
Adjusted EBITDA (1) $188 $208 $214 $194
(1) Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
Investor Day | November 2016
Reconciliation of Pro Forma Sales and Operating Income
(Loss) to Adjusted EBITDA by Segment
115
Pacific
Southern Northwest New Zealand Real Corporate
($ in millions) Timber Timber Timber Estate Trading and Other Total
2016 YTD (9/30)
Sales $102 $52 $126 $211 $76 - $568
Large Dispositions (1) - - - (130) - - (130)
Pro Forma Sales (1) $102 $52 $126 $81 $76 - $438
Operating Income (Loss) $35 ($1) $21 $153 $2 ($16) $194
Depreciation, depletion & amortization 37 15 17 14 - 1 84
Non-cash cost of land and real estate sold - - 2 8 - - 10
Gain on foreign currency derivatives (1) - - - - - (1) (1)
Costs related to shareholder litigation (1) - - - - - 2 2
Large Dispositions (1) - - - (101) - - (101)
Adjusted EBITDA (1) $72 $14 $41 $74 $2 ($14) $188
EBITDA Margin (2) 71% 27% 32% 91% 2% - 43%
2015
Sales $139 $76 $162 $87 $81 - $545
Large Dispositions (1) - - - - - - -
Pro Forma Sales (1) $139 $76 $162 $87 $81 - $545
Operating Income $47 $7 $3 $44 $1 ($24) $78
Depreciation, depletion & amortization 54 15 30 15 - - 114
Non-cash cost of land and real estate sold - - 1 12 - - 13
Costs related to shareholder litigation (1) - - - - - 4 4
Adjusted EBITDA (1) $101 $22 $33 $71 $1 ($20) $208
EBITDA Margin (2) 73% 29% 20% 81% 1% - 38%
(1) Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
(2) EBITDA Margin is calculated as Adjusted EBITDA divided by Pro Forma Sales.
Investor Day | November 2016
Reconciliation of Pro Forma Sales and Operating Income
(Loss) to Adjusted EBITDA by Segment
116
Pacific
Southern Northwest New Zealand Real Corporate
($ in millions) Timber Timber Timber Estate Trading and Other Total
2014
Sales $142 $102 $183 $77 $104 ($4) $604
Large Dispositions (1) - - - (22) - - (22)
Pro Forma Sales (1) $142 $102 $183 $55 $104 ($4) $582
Operating Income $46 $30 $10 $48 $2 ($36) $98
Depreciation, depletion & amortization 52 21 32 13 - 1 120
Non-cash cost of land and real estate sold - - 4 9 - - 13
Large Dispositions (1) - - - (21) - - (21)
Internal review and restatement costs (1) - - - - - 3 3
Adjusted EBITDA (1) $98 $51 $46 $48 $2 ($31) $214
EBITDA Margin (2) 69% 50% 25% 88% 2% - 37%
2013
Sales $124 $111 $148 $149 $132 ($3) $660
Large Dispositions (1) - - - (80) - - (80)
Pro Forma Sales (1) $124 $111 $148 $69 $132 ($3) $580
Operating Income $38 $33 $11 $56 $2 ($30) $109
Depreciation, depletion & amortization 49 21 28 17 - 1 117
Non-cash cost of land and real estate sold - - - 10 - - 10
Large Dispositions (1) - - - (26) - - (26)
Gain related to consolidation of New Zealand JV (1) - - - - - (16) (16)
Adjusted EBITDA (1) $87 $54 $38 $58 $2 ($45) $194
EBITDA Margin (2) 70% 49% 26% 84% 1% - 33%
(1) Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).
(2) EBITDA Margin is calculated as Adjusted EBITDA divided by Pro Forma Sales.
Investor Day | November 2016
Reconciliation of Operating Income (Loss) to Adjusted
EBITDA by Segment
117
Pacific
Southern Northwest New Zealand Real Corporate
($ in millions) Timber Timber Timber Estate Trading and Other Total
2012
Operating Income $23 $21 $2 $32 - ($46) $32
Depreciation, depletion & amortization 53 22 - 8 - 1 85
Non-cash cost of land and real estate sold - - - 5 - - 5
Adjusted EBITDA (1) $76 $43 $2 $45 - ($44) $121
2011
Operating Income $13 $30 $4 $47 $2 ($41) $55
Depreciation, depletion & amortization 43 20 - 12 - 1 77
Non-cash cost of land and real estate sold - - - 4 - - 4
Large Dispositions (1) - - - (25) - - (25)
Adjusted EBITDA (1) $57 $49 $4 $39 $2 ($40) $111
(1) Non-GAAP measure or pro forma item (see Appendix for definitions and reconciliations).