OBJECTIVE
The goal of the Administration's Dialogue and Analysis is to component supplies
data, events, uncertainties and completely different components impacting the Agency and
the Working Partnership and to produce consumers an understanding of
"Administration's perspective." Merchandise 7, Administration's Dialogue and Analysis (MD&A)
highlights the very important areas for evaluating the Agency's effectivity which
incorporates a dialogue on the reportable segments, liquidity and capital, and
very important accounting estimates. The MD&A is provided as a complement to, and
should be be taught together with, our financial statements and notes.
EXECUTIVE SUMMARY
OUR COMPANY
We're a primary timberland precise property funding perception ("REIT") with property
located in among the many best softwood timber rising areas inside the
U.S. and New Zealand. Our revenues, working income and cash flows are
primarily derived from the subsequent core enterprise segments: Southern Timber,
Pacific Northwest Timber, New Zealand Timber, Precise Property and Shopping for and promoting. We private or
lease under long-term agreements roughly 2.4 million acres of timberland
and precise property in Alabama, Arkansas, Florida, Georgia, Louisiana, Oklahoma,
Oregon, South Carolina, Texas and Washington. We actually have a 77% possession
curiosity in Matariki Forestry Group, a 3 approach partnership ("New Zealand subsidiary"),
that owns or leases roughly 417,000 gross acres (297,000 web plantable
acres) of timberlands in New Zealand.All through our timberland administration segments, we promote standing timber (primarily at
public sale to third occasions) and delivered logs. Product sales from our timber segments
embody all actions related to the harvesting of timber and completely different value-added
actions such as a result of the licensing of properties for looking out, the leasing of
properties for mineral extraction and cell towers, along with nature based totally
choices similar to carbon credit score rating product sales. We contemplate we are the second largest
publicly-traded timberland REIT and the fourth largest private timberland proprietor
within the US. Our Precise Property enterprise manages all property product sales and
seeks to maximise the price of our properties that are additional useful for
development, leisure or residential makes use of than for rising timber, and
opportunistically sells non-strategic timberlands. Our Shopping for and promoting section,
primarily consisting of train by the New Zealand subsidiary, markets and
sells timber owned or acquired from third occasions in New Zealand and Australia.
We moreover work together in log shopping for and promoting actions from the U.S. South and U.S. Pacific
Northwest.CURRENT YEAR DEVELOPMENTS
All through 2022, we acquired roughly 141,000 acres of timberlands for $458.5
million. For added data on acquisitions, see Discover 4 - Timberland
Acquisitions .
INDUSTRY AND MARKET CONDITIONS
The demand for timber is immediately related to the underlying demand for pulp,
paper, packaging, lumber and completely different wood merchandise. The quite a few majority of
timber purchased in our Southern Timber section is consumed domestically. With a
higher proportion of pulpwood, our Southern Timber section relies upon carefully on
downstream markets for pulp and paper, and to a lesser extent wood pellet
markets. Our Pacific Northwest Timber section relies upon completely on residence
prospects however moreover exports a giant amount of timber, notably to
China. The Southern Timber and Pacific Northwest Timber segments rely upon the
power of U.S. lumber markets along with underlying housing begins. Our New
Zealand Timber section sells timber to residence New Zealand wood merchandise mills
and as well as exports portion of its amount to markets in China, South
Korea and Taiwan. Together with market dynamics inside the Pacific Rim, the New
Zealand Timber section is matter to worldwide alternate fluctuations, which can
affect the working outcomes of the section in U.S. buck phrases.All through 2022, worldwide log and lumber markets expert elevated volatility due
partly to Russia's invasion of Ukraine and subsequent sanctions positioned on
Russia. Whereas we do not anticipate our operations to be immediately impacted by the
battle presently, changes in worldwide wood and commodity flows might affect
the markets by which we perform.33
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In 2022, pricing inside the U.S. South improved versus the prior yr, with
will enhance in every pulpwood and sawtimber prices in response to favorable native
market present and demand dynamics. Whereas pricing can be influenced by
macroeconomic components, along with residential constructing train, prices can
differ considerably on a neighborhood stage based totally on local weather, the obtainable inventory of
logs, mill demand, and export market entry. Throughout the Pacific Northwest, frequent
log prices for 2022 had been higher when compared with the prior yr, pushed by a
combination of improved sawtimber pricing ensuing from sturdy residence demand
from lumber mills, along with higher pulpwood pricing ensuing from sturdy
end-market demand and supply constraints. In New Zealand, frequent log prices for
2022 had been lower than the prior yr, which mirrored the decline inside the NZ$/US$
alternate cost, along with the COVID lockdowns and constructing market headwinds
in China which constrained export market demand.We're matter to the hazard of worth fluctuations in certain of our value
components, primarily logging and transportation (decrease and haul), ocean freight
and demurrage costs. In 2022, each of our timber segments expert upward
stress on these value components, with most likely a very powerful improve
expert in logging and transportation costs in our Southern Timber section.
Totally different foremost components of our value of product sales are the worth basis of timber purchased
(depletion) and the worth basis of precise property purchased. Depletion consists of the
amortization of capitalized web site preparation, planting and fertilization, precise
property taxes, timberland lease funds and certain payroll costs. The related payment
basis of precise property purchased consists of the worth basis in land and costs immediately
associated to the occasion and constructing of acknowledged precise property
duties, similar to infrastructure, roadways, utilities, services and/or completely different
enhancements. Totally different costs embody amortization of capitalized costs related to
freeway and bridge constructing and software program program, depreciation of mounted property and
instruments, freeway maintenance, severance and excise taxes, fireplace prevention and
precise property commissions and shutting costs.In Precise Property, complete demand and pricing for HBU properties remained sturdy in
2022. Whereas higher charges of curiosity prompted demand for certain rural properties to
common all through the second half of 2022, favorable migration and demographic
traits proceed to be taught our improved development properties, significantly
Wildlight, our development problem north of Jacksonville, Florida, and
Heartwood, our development problem south of Savannah, Georgia.
CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements requires us to find out accounting
insurance coverage insurance policies and make estimates, assumptions and judgments that impact our property,
liabilities, revenues and payments, and to disclose contingent property and
liabilities in our Annual Report on Sort 10-Okay. We base these estimates and
assumptions on historic information and traits, current fact patterns, expectations
and completely different sources of data we contemplate are inexpensive. Exact outcomes may
differ from these estimates.
MERCHANTABLE INVENTORY AND DEPLETION COSTS AS DETERMINED BY TIMBER HARVEST
MODELS
An annual depletion cost is established for each express space by dividing
the worth of merchantable inventory (along with costs described above) by standing
merchantable inventory amount. Pre-merchantable data are maintained for each
planted yr age class, along with acres planted, stems per acre and costs of
planting and tending. For additional data, see Dialogue of Timber Inventory
and Sustainable Yield in Merchandise 1 - Enterprise .Important assumptions and estimates are used inside the recording of timber
inventory and depletion costs. Components which will affect timber amount embody
local weather changes, losses as a consequence of pure causes, variations in exact versus
estimated progress costs and changes inside the age when timber is taken into consideration
merchantable. A 3% company-wide change in estimated standing merchantable
inventory would have prompted an estimated change of roughly $3.9 million to
2022 depletion expense.Merchantable standing timber inventory is estimated by our land data
corporations group yearly, using industry-standard laptop software program program. The
inventory calculation takes into consideration progress, in-growth (annual swap of
oldest pre-merchantable age class into merchantable inventory), timberland product sales
and the annual harvest explicit to each enterprise unit. The age at which timber
is taken into consideration merchantable is reviewed periodically and updated for altering
harvest practices, future harvest age profiles and natural progress components.34
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Acquisitions of timberland may even impact the depletion cost. Upon the
acquisition of timberland, we make a dedication whether or not or to not combine the
newly-acquired merchantable timber with an current depletion pool or to create
a model new pool. The dedication is based on the geographic location of the model new
timber, the purchasers/markets that shall be served and species mix. All through 2022,
we acquired 141,000 acres of timberlands in Alabama, Florida, Georgia,
Louisiana, Texas, Washington and New Zealand. These acquisitions did not have a
supplies affect on 2022 depletion costs.
REVENUE RECOGNITION
See Discover 1 – Summary of Important Accounting Insurance coverage insurance policies .
DETERMINING THE ADEQUACY OF PENSION AND OTHER POSTRETIREMENT BENEFIT ASSETS AND
LIABILITIES
Now we have now one licensed non-contributory outlined revenue pension plan defending a
portion of our employees and an unfunded plan that offers benefits in additional
of portions allowable under current tax regulation inside the licensed plan. The licensed
and unfunded plans are closed to new members. Environment friendly December 31, 2016,
we froze benefits for all employees collaborating inside the pension plans.In 2022, we acknowledged $0.2 million of pension and postretirement revenue
credit score rating because of anticipated return on plan property offsetting curiosity costs and
amortization of losses. Fairly a couple of estimates and assumptions are required to
resolve the best amount of pension and postretirement liabilities and annual
expense to report in our financial statements. The essential factor assumptions embody
low price cost, return on property, properly being care value traits, mortality costs and
longevity of employees. Although there's authoritative steering on how one can
select numerous the assumptions, some extent of judgment is exercised in
deciding on these assumptions. Completely completely different assumptions, along with exact versus
anticipated outcomes, would change the periodic revenue value and funded standing of
the revenue plans acknowledged inside the financial statements. The changes in our
low price cost and anticipated return on plan property have an inverse relationship
with our projected revenue obligation and pension expense, respectively. A
hypothetical 25 basis degree improve/decrease in our pension plan's low price
cost would result in a decrease/improve inside the projected revenue obligation of
roughly $1.9 million and $2.0 million, respectively. A hypothetical 25
basis degree improve/decrease in our pension plan's anticipated return on plan
property assumption would result in a decrease/improve in pension expense of
roughly $0.2 million. See Discover 18 - Employee Revenue Plans for
additional data.
IMPAIRMENT OF LONG-LIVED ASSETS
We analysis the carrying amount of long-lived property at any time when an event or a change
in circumstances signifies that the carrying value of the asset or asset group
is not going to be recoverable by the use of future operations. If we contemplate recoverability,
we're required to estimate future cash flows and residual value of the asset or
asset group. The evaluation of future cash flows requires utilizing assumptions
that embody future monetary conditions similar to constructing costs and product sales
values that can differ from exact outcomes. An impairment loss is acknowledged if
the carrying amount of an asset is not going to be recoverable and exceeds its trustworthy value.
See Discover 1 - Summa ry of Important Accounting Insurance coverage insurance policies for
additional data.DEFERRED TAX ITEMS
The Timber and Precise Property operations carried out inside our REIT are usually
not matter to U.S. income taxation. We anticipate any variability in our environment friendly
tax cost and the amount of cash taxes to be paid to be pushed primarily by our
New Zealand Timber and Shopping for and promoting segments. Rayonier's taxable REIT subsidiary is
matter to U.S. federal and state income taxes. Deferred tax expense or revenue
is acknowledged inside the financial statements in line with the changes in deferred
tax property and liabilities between years. Valuation allowances are established
to reduce deferred tax property when it turns into additional seemingly than not that such
property is just not going to be realized. See Discover 20 - Earnings Taxes for additional
particulars about our unrecognized tax benefits.35
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ENVIRONMENTAL AND NATURAL RESOURCE DAMAGE LIABILITIES
We resolve the costs of environmental remediation for areas now we have now been named
most likely liable occasions based totally on evaluations of current regulation and current
utilized sciences. Inherent uncertainties exist in such evaluations primarily as a consequence of
unknown environmental conditions, altering governmental guidelines and licensed
necessities regarding obligation and rising remediation utilized sciences. At
December 31, 2022, your complete amount of liabilities recorded on our Consolidated
Steadiness Sheets related to environmental contamination and Pure Helpful useful resource
Damages was $15.6 million, which mirrored an increase in liabilities related to
revised environmental and pure belongings damage value estimates recorded in
the fourth quarter of 2022. That's administration's most interesting estimate of the costs for
remediation and restoration, however, administration will proceed to look at the
cleanup course of and make modifications to the obligation as needed. For additional
data, see Governmental Legal guidelines and Environmental Points in Merchandise 1
- Enterprise , Discover 1 - Summary of Important Accounting Insurance coverage insurance policies and Discover
12 - Environmental Remediation Liabilities .36
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Desk of ContentsRESULTS OF OPERATIONS
Summary of our outcomes of operations for the three years ended December 31:
Financial Data (in 1000’s and 1000’s of {{dollars}})
2022 2021 2020
Product sales
Southern Timber $264.2 $204.4 $191.8
Pacific Northwest Timber 162.2 143.0 120.8
New Zealand Timber 274.1 281.2 202.3
Timber Funds (a) - 199.4 29.6
Precise Property
Improved Progress 35.4 51.7 14.5
Unimproved Progress - 37.5 8.4
Rural 59.5 43.1 67.2
Timberland & Non-Strategic. 11.4 - 19.3Conservation Easement - 3.9 3.1
Deferred Revenue/Totally different (b) 1.2 (2.4) 0.9
Big Inclinations 30.5 56.0 116.0
Full Precise Property 138.0 189.9 229.3
Shopping for and promoting 71.0 95.4 89.0
Intersegment Eliminations (0.4) (3.7) (3.6)
Full Product sales $909.1 $1,109.6 $859.2Working Earnings (Loss)
Southern Timber $96.6 $66.1 $41.3
Pacific Northwest Timber 15.2 6.8 (10.0)
New Zealand Timber 30.6 51.5 30.0
Timber Funds (a) - 63.3 (13.2)
Precise Property (b)(c) 58.5 112.5 72.0
Shopping for and promoting 0.4 0.1 (0.5)
Firm and completely different (35.5) (30.6) (45.2)
Working Earnings 165.8 269.8 74.4
Curiosity expense (36.2) (44.9) (38.8)
Curiosity and completely different miscellaneous income, web 2.6 0.2 1.2
Earnings tax expense (9.4) (14.6) (7.0)Net Earnings 122.8 210.5 29.8
A lot much less: Net (income) loss attributable to noncontrolling pursuits
in consolidated associates (d)
(13.3) (53.4) 7.8
Net Earnings Attributable to Rayonier, L.P. $109.5 $157.1 $37.6
A lot much less: Net income attributable to noncontrolling pursuits inside the
working partnership
(2.4) (4.5) (0.5)
Net Earnings Attributable to Rayonier Inc. $107.1 $152.6 $37.1Adjusted EBITDA (e)
Southern Timber $156.9 $120.2 $109.1
Pacific Northwest Timber 63.9 57.3 37.1
New Zealand Timber 54.5 78.5 55.0
Timber Funds - 2.3 1.8
Precise Property 72.7 100.7 91.4
Shopping for and promoting 0.4 0.1 (0.5)
Firm and completely different (34.2) (29.4) (26.6)
Full Adjusted EBITDA (e) $314.2 $329.8 $267.4(a)The yr ended December 31, 2021 consists of product sales and dealing income of
$156.8 million and $51.5 million, respectively, from Fund II Timberland
Inclinations.
(b)Consists of deferred revenue modifications, revenue true-ups and promoting and advertising and marketing costs
related to Improved Progress product sales together with residential and enterprise
lease revenue.
(c)The yr ended December 31, 2022 consists of $16.0 million of equity income from
the sale of a multi-family condominium difficult in Bainbridge Island, Washington
and $16.6 million from Big Inclinations. The years ended December 31, 2021 and
December 31, 2020 embody income of $44.8 million and $28.7 million,
respectively, from Big Inclinations.
(d)The yr ended December 31, 2021 incorporates a $41.2 million obtain from Fund II
Timberland Inclinations. The yr ended December 31, 2020 incorporates a $7.3
million loss related to timber write-offs ensuing from casualty events.
(e)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 -
Effectivity and Liquidity Indicators .37
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Desk of ContentsSouthern Timber Overview 2022 2021 2020
Product sales Amount (in 1000's of tons)
Pine Pulpwood 3,911 3,516 3,804
Pine Sawtimber 2,041 2,001 2,243
Full Pine Amount 5,952 5,517 6,047
Hardwood 331 177 152
Full Amount 6,283 5,694 6,199% Delivered Amount (vs. Full Amount) 43 % 40 % 41 %
% Pine Sawtimber Amount (vs. Full Pine Amount) 34 % 36 % 37 %
% Export Amount (vs. Full Amount) (a) 2 % 5 % 3 %Net Stumpage Prices ({{dollars}} per ton) (b)
Pine Pulpwood $22.45 $19.09 $15.83
Pine Sawtimber 34.36 28.27 25.72
Weighted Widespread Pine $26.53 $22.42 $19.50
Hardwood 23.48 17.96 11.52
Weighted Widespread Full $26.37 $22.28 $19.30Summary Financial Information (in 1000's and 1000's of {{dollars}})
Timber Product sales $236.6 $179.8 $170.2
A lot much less: Scale back and Haul (64.0) (43.6) (45.4)
A lot much less: Port and Freight (6.8) (9.4) (5.2)
Net Stumpage Product sales $165.8 $126.9 $119.6Non-Timber Product sales 27.6 24.6 21.6
Full Product sales $264.2 $204.4 $191.8Working Earnings $96.6 $66.1 $41.3
(+) Timber write-offs ensuing from casualty
events (c) - - 6.0
(+) Depreciation, depletion and amortization 60.3 54.1 61.8
Adjusted EBITDA (d) $156.9 $120.2 $109.1Totally different Information
12 months-End Acres (in 1000's) 1,919 1,798 1,733
(a)Estimated proportion of export amount, which contains volumes purchased to
third-party exporters together with direct exports by the use of our log export
program.
(b)Pulpwood and sawtimber product pricing for composite stumpage product sales is
estimated based totally on market information.
(c)Timber write-offs ensuing from casualty events embody the write-off of
merchantable and pre-merchantable timber amount destroyed by casualty events
which might't be salvaged.
(d)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 –
Effectivity and Liquidity Indicators .
38
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Pacific Northwest Timber Overview 2022 2021 2020
Product sales Amount (in 1000's of tons)
Pulpwood 300 287 297Sawtimber 1,285 1,382 1,306
Full Amount 1,585 1,669 1,603
% Delivered Amount (vs. Full Amount) 92 % 88 % 90 %
% Sawtimber Amount (vs. Full Amount) 81 % 83 % 82 %
% Export Amount (vs. Full Amount) (a) 11 % 16 % 10 %Delivered Log Pricing (in {{dollars}} per ton)
Pulpwood $50.83 $31.65 $35.51
Sawtimber 112.44 97.87 84.93
Weighted Widespread Log Worth $100.50 $86.23 $75.44Summary Financial Information (in 1000's and 1000's of {{dollars}})
Timber Product sales $156.6 $137.1 $116.6
A lot much less: Scale back and Haul (62.7) (55.3) (54.6)
A lot much less: Port and Freight (2.8) - -
Net Stumpage Product sales $91.1 $81.8 $62.0Non-Timber Product sales 5.6 5.9 4.2
Full Product sales $162.2 $143.0 $120.8Working Earnings (Loss) $15.2 $6.8 ($10.0)
(+) Timber write-off ensuing from casualty
events (b) 0.7 - -
(+) Depreciation, depletion and amortization 48.0 50.5 47.1
Adjusted EBITDA (c) $63.9 $57.3 $37.1Totally different Information
12 months-End Acres (in 1000's) 474 490 507
Northwest Sawtimber (in {{dollars}} per MBF) (d) $849 $748 $666
(a)Estimated proportion of export amount, which contains volumes purchased to
third-party exporters together with direct exports by the use of our log export
program.
(b)Timber write-off ensuing from casualty events consists of the write-off of
merchantable and pre-merchantable timber amount related to a fire casualty
event.
(c)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 –
Effectivity and Liquidity Indicators .
(d)Delivered Sawtimber excluding chip-n-saw.
39
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Desk of ContentsNew Zealand Timber Overview 2022 2021 2020
Product sales Amount (in 1000’s of tons)
House Pulpwood (Delivered) 388 425 470
House Sawtimber (Delivered) 686 671 665
Export Pulpwood (Delivered) 182 198 133
Export Sawtimber (Delivered) 1,360 1,308 1,221Full Amount 2,616 2,602 2,488
% Delivered Amount (vs. Full Amount) 100 %
100 % 100 %
% Sawtimber Amount (vs. Full Amount) 78 %
76 % 76 %
% Export Amount (vs. Full Amount) (a) 59 %
58 % 54 %
Delivered Log Pricing (in {{dollars}} per ton)
House Pulpwood $33.50 $41.97 $33.79
House Sawtimber 71.87 83.19 70.37
Export Sawtimber 124.91 138.84 98.47
Weighted Widespread Log Worth $96.77 $107.65 $78.17
Summary Financial Information (in 1000’s and 1000’s of {{dollars}})
Timber Product sales $253.1 $280.1 $194.5
A lot much less: Scale back and Haul (95.8) (93.4) (77.6)
A lot much less: Port and Freight Costs (92.5) (89.6) (42.9)
Net Stumpage Product sales $64.8 $97.1 $74.0Non-Timber Product sales / Carbon Credit score 21.0 1.1 7.8
Full Product sales $274.1 $281.2 $202.3Working Earnings $30.6 $51.5 $30.0
(+) Depreciation, depletion and amortization 23.9 27.0 25.0
Adjusted EBITDA (b) $54.5 $78.5 $55.0Totally different Information
New Zealand Buck to U.S. Buck Change Cost (c) 0.6350 0.7090 0.6522
Net Plantable 12 months-End Acres (in 1000's) 297 296 296
Export Sawtimber (in {{dollars}} per JAS m3) $145.23
$161.42 $114.50
House Sawtimber (in $NZD per tonne) $124.50 $129.07 $118.69(a)Estimated proportion of export amount which contains volumes purchased to
third-party exporters together with direct exports by the use of our log export
program.
(b)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 -
Effectivity and Liquidity Indicators .
(c)Represents the interval frequent costs for yearly.40
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Desk of ContentsPrecise Property Overview 2022 2021 2020
Product sales (in 1000's and 1000's of {{dollars}})
Improved Progress (a) $35.4 $51.7 $14.5
Unimproved Progress - 37.5 8.4
Rural 59.5 43.1 67.2
Timberland & Non-Strategic 11.4 - 19.3Conservation Easement - 3.9 3.1
Deferred Revenue/Totally different (b) 1.2 (2.4) 0.9
Big Inclinations (c) 30.5 56.0 116.0
Full Product sales $138.0 $189.9 $229.3Acres Supplied
Improved Progress (a) 225 791 330
Unimproved Progress - 359 570
Rural 13,156 14,565 22,437
Timberland & Non-Strategic 3,966 34 20,701Big Inclinations (c) 10,977 16,622 66,946
Full Acres Supplied 28,323 32,371 110,984Worth per Acre ({{dollars}} per acre)
Improved Progress (a) $157,424 $65,375 $43,957
Unimproved Progress - 104,579 14,780
Rural 4,522 2,958 2,993
Timberland & Non-Strategic 2,874 1,297 930Big Inclinations (c) 2,776 3,372 1,733
Weighted Widespread (Full) (d) $6,128 $8,403 $2,483
Weighted Widespread (Adjusted) (e) $4,140 $5,391 $2,170Full Product sales (Excluding Big Inclinations) $107.5 $133.9 $113.3
Working Earnings $58.5 $112.5 $72.0
(+) Depreciation, depletion and amortization 13.9 7.9 17.7(+) Non-cash value of land and improved
development 28.4 25.0 30.4(-) Purchase associated to the multi-family
condominium difficult sale attributable to NCI (f) (11.5) - -
(-) Big Inclinations (c) (16.6) (44.8) (28.7)
Adjusted EBITDA (g) $72.7 $100.7 $91.4(a)Shows land with capital invested in infrastructure enhancements.
(b)Consists of deferred revenue modifications, revenue true-ups and promoting and advertising and marketing costs
related to Improved Progress product sales together with residential and enterprise
lease revenue.
(c)Big Inclinations are outlined as transactions involving the sale of
timberland that exceed $20 million in measurement and do not have a demonstrable
premium relative to timberland value.
(d)Excludes Big Inclinations.
(e)Excludes Improved Progress and Big Inclinations.
(f)Purchase associated to the multi-family condominium difficult sale attributable to
NCI represents the obtain acknowledged in reference to the sale of property by
the Bainbridge Landing three approach partnership attributable to noncontrolling pursuits.
(g)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 -
Effectivity and Liquidity Indicators .41
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Desk of ContentsShopping for and promoting Overview 2022 2021 2020
Product sales Amount (in 1000's of tons)
U.S. 99 1 1
NZ 460 705 959Full Amount 559 706 960
Summary Financial Information (in 1000's and 1000's of {{dollars}})
Shopping for and promoting Product sales $69.3 $93.6 $87.6
Non-Timber Product sales 1.7 1.7 1.4
Full Product sales $71.0 $95.4 $89.0Working Earnings (Loss) $0.4 $0.1 ($0.5)
Adjusted EBITDA (a) $0.4 $0.1 ($0.5)
(a)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 –
Effectivity and Liquidity Indicators .
42
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Capital Expenditures By Part 2022 2021 2020
Timber Capital Expenditures (in 1000's and 1000's of {{dollars}})
Southern Timber
Reforestation, silvicultural and completely different capital
expenditures $24.1 $21.5 $20.7
Property taxes 7.1 6.8 6.8
Lease and timber deed funds 3.1 3.1 3.5
Allotted overhead 4.9 4.4 4.4
Subtotal Southern Timber $39.3 $35.8 $35.5
Pacific Northwest Timber
Reforestation, silvicultural and completely different capital
expenditures 10.5 10.8 6.5
Property taxes 1.1 1.1 0.8Allotted overhead 5.2 4.7 4.1
Subtotal Pacific Northwest Timber $16.8 $16.6 $11.4
New Zealand Timber
Reforestation, silvicultural and completely different capital
expenditures 10.9 11.2 8.9
Property taxes 0.8 0.8 0.7
Lease and timber deed funds 4.4 5.2 4.3
Allotted overhead 2.4 3.0 2.7
Subtotal New Zealand Timber $18.5 $20.1 $16.6
Full Timber Segments Capital Expenditures $74.5 $72.5 $63.5
Timber Funds ("Look-through") (a) - 0.5 0.3
Precise Property 0.3 0.2 0.4Full Capital Expenditures $74.8 $73.2 $64.2
Timberland Acquisitions
Southern Timber $457.8 $168.2 $24.2New Zealand Timber 0.7 10.9 0.5
Full Timberland Acquisitions $458.5 $179.1 $24.7
Precise Property Progress Investments (b) $13.7 $12.5 $6.5
(a)The years ended December 31, 2021 and December 31, 2020 exclude $2.8 million
and $2.3 million, respectively, of capital expenditures attributable to
noncontrolling pursuits in Timber Funds.
(b)Represents investments in grasp infrastructure or entitlements in our precise
property development duties. Precise Property Progress Investments are amortized
as a result of the underlying properties are purchased and included in Non-Cash Worth of Land and
Improved Progress.43
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Desk of Contents
RESULTS OF OPERATIONS, 2022 VERSUS 2021
(1000's and 1000's of {{dollars}})The following tables summarize product sales, working income and Adjusted EBITDA
variances for 2022 versus 2021:
Product sales Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Precise Property Shopping for and promoting Elim. Full
2021 $204.4 $143.0 $281.2 $199.4 $189.9 $95.4 ($3.7) $1,109.6
Amount 13.1 (4.1) 1.4 - 12.9 (19.5) - 3.8
Worth 25.7 11.3 (37.5) - (39.9) (4.8) - (45.2)
Non-timber product sales 3.0 (0.3) 20.0 - - 0.1 - 22.8
Worldwide alternate (a) - - (7.5) - - - - (7.5)
Totally different 18.0 (b) 12.3 (b) 16.5 (c) (199.4) (24.9) (d) (0.2) 3.3 (e) (174.4)
2022 $264.2 $162.2 $274.1 - $138.0 $71.0 ($0.4) $909.1(a)Net of overseas cash hedging affect.
(b)Consists of variance as a consequence of stumpage versus delivered product sales.
(c)Consists of variance as a consequence of residence versus export product sales.
(d)Incorporates a $25.6 million decrease in Big Inclinations together with
Conservation Easements product sales in 2021.
(e)Incorporates a decrease in Intersegment eliminations related to timberland
administration costs paid by the timber funds and reported as product sales contained in the Timber
Funds section.Working Earnings Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Precise Property Shopping for and promoting Firm and Totally different Full
2021 $66.1 $6.8 $51.5 $63.3 $112.5 $0.1 ($30.6) $269.8
Amount 7.5 (1.1) 0.4 - 9.7 - - 16.5
Worth (a) 25.7 11.3 (37.5) - (39.9) - - (40.4)
Worth (4.5) (2.2) (1.9) - (7.6) 0.2 (4.9) (20.9)
Non-timber income 2.5 (0.3) 19.7 - - 0.1 - 22.0
Worldwide alternate (b) - - (2.1) - - - - (2.1)
Depreciation, depletion &
amortization (0.7) - 0.5 - (5.3) - - (5.5)
Non-cash value of land and
improved development - - - - (2.4) - - (2.4)
Totally different (c) - 0.7 - (63.3) (8.5) - - (71.1)
2022 $96.6 $15.2
$30.6 - $58.5 $0.4 ($35.5) $165.8(a)For Timber segments, worth shows web stumpage realizations (i.e. web of
decrease and haul and supply costs). For Precise Property, worth is launched web of
cash closing costs.
(b)Net of overseas cash hedging affect.
(c)Precise Property primarily consists of Big Inclinations and equity income from
three approach partnership entities, along with the obtain from the sale of the multi-family
condominium difficult in Bainbridge Island, Washington.44
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Desk of ContentsAdjusted EBITDA (a) Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Precise Property Shopping for and promoting Firm and Totally different Full
2021 $120.2 $57.3 $78.5 $2.3 $100.7 $0.1 ($29.4) $329.8
Amount 13.0 (3.6) 0.5 - 12.9 - - 22.8
Worth (b) 25.7 11.3 (37.5) - (39.9) - - (40.4)
Worth (4.5) (2.2) (1.9) - (7.6) 0.2 (4.8) (20.8)
Non-timber income 2.5 (0.3) 19.7 - - 0.1 - 22.0
Worldwide alternate (c) - - (4.8) - - - - (4.8)
Totally different (d) - 1.4 - (2.3) 6.6 - - 5.7
2022 $156.9 $63.9 $54.5 - $72.7 $0.4 ($34.2) $314.2(a)Adjusted EBITDA is a non-GAAP measure outlined and reconciled in Merchandise 7 -
Effectivity and Liquidity Indicators .
(b)For Timber segments, worth shows web stumpage realizations (i.e. web of
decrease and haul and supply costs). For Precise Property, worth is launched web of
cash closing costs.
(c)Net of overseas cash hedging affect.
(d)Pacific Northwest Timber incorporates a $1.4 million timber reservation sale to a
conservation group.SOUTHERN TIMBER
Full-year product sales of $264.2 million elevated $59.8 million, or 29%, versus the
prior yr, along with an increase in non-timber product sales of $3.0 million versus the
prior yr. Harvest volumes elevated 10% to 6.28 million tons versus 5.69
million tons inside the prior yr. Widespread pine sawtimber stumpage prices elevated
22% to $34.36 per ton versus $28.27 per ton inside the prior yr, whereas frequent
pine pulpwood stumpage prices elevated 18% to $22.45 per ton versus $19.09 in
the prior yr. The rise in frequent pine pulpwood prices was primarily due
to sturdy residence demand. The rise in frequent pine sawtimber prices was
primarily as a consequence of sturdy residence lumber demand, along with upward stress on
chip-n-saw pricing as a consequence of elevated rivals from pulp mills.Working income of $96.6 million elevated $30.5 million versus the prior
yr as a consequence of higher web stumpage realizations ($25.7 million), higher volumes
($7.5 million), and higher non-timber income ($2.5 million), partially offset by
higher costs ($4.5 million) and higher depletion costs ($0.7 million). Full-year
Adjusted EBITDA of $156.9 million was $36.7 million above the prior yr.
PACIFIC NORTHWEST TIMBER
Full-year product sales of $162.2 million elevated $19.2 million, or 13%, versus the
prior yr. Harvest volumes decreased 5% to 1.59 million tons versus 1.67
million tons inside the prior yr. Widespread delivered sawtimber prices elevated 15%
to $112.44 per ton versus $97.87 per ton inside the prior yr, reflecting
comparatively sturdy purchaser demand and species mix, as a greater
proportion of Douglas-fir sawtimber was harvested. Widespread delivered pulpwood
prices elevated 61% to $50.83 per ton versus $31.65 per ton inside the prior yr,
primarily pushed by present constraints amid sturdy end-market demand.Working income of $15.2 million improved $8.4 million versus the prior yr,
primarily as a consequence of higher web stumpage realizations ($11.3 million) and a timber
reservation sale to a conservation group ($1.4 million), partially offset by
higher costs ($2.2 million), lower volumes ($1.1 million), a timber write-off
ensuing from casualty events ($0.7 million), and reduce non-timber income ($0.3
million). Full-year Adjusted EBITDA of $63.9 million was $6.6 million above the
prior yr.NEW ZEALAND TIMBER
Full-year product sales of $274.1 million decreased $7.1 million, or 3%, versus the
prior yr. Harvest volumes elevated 1% to 2.62 million tons versus 2.60
million tons inside the prior yr pushed by barely higher export demand versus
the prior yr interval that was negatively impacted by COVID-19 related
headwinds. Widespread delivered prices for export sawtimber decreased 10% to
$124.91 per ton versus $138.84 per ton inside the prior yr, whereas frequent
delivered prices for residence sawtimber decreased 14% to $71.87 per ton versus
$83.19 per ton inside the prior yr. The decrease in export sawtimber prices
primarily mirrored constrained export market demand as a consequence of COVID lockdowns and
constructing market headwinds in China. The decrease in residence sawtimber
prices (in U.S. buck phrases) was primarily pushed by the NZ$/US$ alternate cost
(US$0.64 per NZ$1.00 versus US$0.71 per NZ$1.00). Excluding the affect of
worldwide alternate costs, residence sawtimber prices decreased 4% from the prior
yr, reflecting slowing residence market demand and further present as a consequence of
export market headwinds.45
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Working income of $30.6 million decreased $20.9 million versus the prior
yr as a consequence of lower web stumpage realizations ($37.5 million), unfavorable worldwide
alternate impacts ($2.1 million), and higher forest administration costs ($1.9
million), partially offset by lower depletion costs ($0.5 million), higher
volumes ($0.4 million), and higher non-timber income ($19.7 million). Full-year
Adjusted EBITDA of $54.5 million was $24.0 million beneath the prior yr.
TIMBER FUNDS
All through 2021, we purchased the rights to deal with Fund III and Fund IV, along with our
possession pursuits in every funds, and we achieved the liquidation of Fund II
timberland property. As such, we had no product sales, working income or Adjusted EBITDA
in 2022 inside the Timber Funds section.
REAL ESTATE
Full-year product sales of $138.0 million decreased $51.9 million versus the prior
yr, whereas working income of $58.5 million decreased $54.0 million versus the
prior yr. Product sales and dealing income inside the current yr included $30.5
million and $16.6 million, respectively, from Big Inclinations. Current yr
working income moreover included an $11.5 million obtain attributable to
noncontrolling pursuits from the sale of a multi-family condominium difficult in
Bainbridge Island, Washington. Prior yr product sales and dealing income included
$56.0 million and $44.8 million, respectively, from Big Inclinations. Product sales
decreased primarily as a consequence of lower volumes (28,323 acres purchased versus 32,371 acres
purchased inside the prior yr) and reduce weighted frequent prices ($4,829 per acre
versus $5,820 per acre inside the prior yr). Full-year Adjusted EBITDA of $72.7
million was $28.0 million beneath the prior yr.
TRADING
Full-year product sales of $71.0 million decreased $24.4 million versus the prior yr
as a consequence of lower volumes and prices. Product sales volumes decreased 21% to 559,000 tons
versus 706,000 tons inside the prior yr. Working income and Adjusted EBITDA
elevated $0.2 million versus the prior yr.
CORPORATE AND OTHER EXPENSE/ELIMINATIONS
Full-year firm and completely different working expense of $35.5 million elevated
$4.9 million versus the prior yr, primarily as a consequence of higher compensation
payments ($3.9 million), higher licensed costs ($0.7 million), higher meals and
journey payments ($0.6 million), and higher completely different overhead costs ($0.4 million),
partially offset by lower revenue costs ($0.7 million).
INTEREST EXPENSE
Full-year curiosity expense of $36.2 million decreased $8.7 million versus the
prior yr interval, as a result of the prior yr interval included a $2.2 million loss from
the termination of a cash transfer hedge. Furthermore, full-year curiosity expense
benefited from lower frequent glorious debt and a lower weighted-average
price of curiosity as compared with the prior yr interval.
INTEREST AND OTHER MISCELLANEOUS INCOME, NET
Totally different non-operating income of $2.6 million elevated $2.4 million versus the
prior yr primarily as a consequence of elevated curiosity income and prior yr costs
related to debt extinguishments and modifications, partially offset by elevated
environmental and pure helpful useful resource damage remediation costs.
INCOME TAX EXPENSE
Full-year income tax expense of $9.4 million decreased $5.3 million versus the
prior yr interval due to lower taxable income. The New Zealand
subsidiary is the primary driver of income tax expense.
RESULTS OF OPERATIONS, 2021 VERSUS 2020
Discuss with Merchandise 7 - "Administration's Dialogue and Analysis of Financial Scenario
and Outcomes of Operations" half contained in our Annual Report on Sort 10-Okay
for the yr ended December 31, 2021 for the outcomes of operations dialogue
for the fiscal yr ended December 31, 2021 compared with the fiscal yr ended
December 31, 2020.46
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Desk of ContentsOUTLOOK FOR 2023
In 2023, we anticipate to achieve full-year harvest volumes in our Southern Timber
section of 6.7 to 7.0 million tons. The anticipated improve relative to 2022
shows the additional amount associated to our beforehand launched
acquisitions. We moreover anticipate higher non-timber income for full-year 2023 as
compared with full-year 2022. Nonetheless, we anticipate that the rise in harvest
volumes and non-timber income shall be largely offset by lower weighted frequent
stumpage realizations as a consequence of softer demand along with higher harvest and
transportation costs.In our Pacific Northwest Timber section, we anticipate to achieve full-year harvest
volumes of roughly 1.5 to 1.6 million tons. The anticipated decrease
relative to 2022 shows present land product sales train, a additional muted residence
demand outlook, and an ongoing mix shift in direction of Douglas-fir, which has a lower
MBF-to-ton conversion ratio. We further anticipate weighted frequent pricing to
decline relative to full-year 2022 as a consequence of weaker macroeconomic conditions and
lower lumber prices.In our New Zealand Timber section, we anticipate to achieve full-year harvest
volumes of two.5 to 2.7 million tons. We anticipate that stumpage margins will
keep under stress to begin out the yr nevertheless are optimistic that export market
conditions will usually improve as a result of the working setting in China
normalizes following the COVID-related disruptions that persevered all by means of
2022. We further anticipate that favorable carbon credit score rating pricing and volumes will
contribute to improved ends in 2023.In our Precise Property section, we're impressed by the continued curiosity in every
our development duties and rural properties whatever the higher price of curiosity
setting. Nonetheless, we anticipate that precise property train shall be
significantly weighted to the second half of the yr, with comparatively restricted
train inside the first quarter significantly.
Our 2023 outlook is matter to numerous variables and uncertainties,
along with these talked about at Merchandise 1A – Risk Components .
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LIQUIDITY AND CAPITAL RESOURCES
Our principal provide of cash is cash transfer from operations, primarily the
harvesting of timber and product sales of precise property. As a REIT, our principal use of cash
is dividends on Rayonier Inc. frequent shares and distributions on Rayonier, L.P.
fashions. We moreover use cash to deal with the productiveness of our timberlands by the use of
replanting and silviculture. Our operations have usually produced fixed
cash transfer and required restricted capital belongings. Transient-term borrowings have
helped fund working capital desires, whereas acquisitions of timberlands usually
require funding from exterior sources or Big Inclinations.
STRATEGY
We repeatedly contemplate our capital building. Our method is to deal with a
weighted-average value of capital aggressive with completely different timberland REITs and
TIMOs, whereas sustaining an funding grade debt rating along with retaining
the pliability to actively pursue capital allocation alternate options as they
transform obtainable. Common, we contemplate now we have now sufficient liquidity and sources of
capital to run our corporations successfully and efficiently and to maximise the
value of our timberland and precise property property under administration.
CREDIT RATINGS
Every our potential to amass financing and the related costs of borrowing are
affected by our credit score rating rankings, which can be periodically reviewed by the rating
corporations. As of December 31, 2022, our credit score rating rankings from S&P and Moody's had been
"BBB-" and "Baa3," respectively, with every corporations itemizing our outlook as
"Safe."
SUMMARY OF LIQUIDITY AND FINANCING COMMITMENTS
As of December 31,
(in 1000's and 1000's of {{dollars}}) 2022 2021 2020
Cash and cash equivalents (excluding Timber Funds) $114.3 $358.7 $80.5
Full debt (excluding Timber Funds) (a) 1,523.1 1,376.1 1,294.9
Noncontrolling pursuits inside the working partnership 105.8 133.8 130.1
Shareholders' equity 1,880.7 1,815.6 1,862.6
Net Earnings Attributable to Rayonier Inc. 107.1 152.6 37.1
Adjusted EBITDA (b) 314.2 329.8 267.4
Full capitalization (entire debt plus eternal and momentary
equity)
3,509.6 3,325.5 3,287.6
Debt to capital ratio 43 % 41 % 39 %
Debt to Adjusted EBITDA (b) 4.8 4.2 4.8
Net debt to Adjusted EBITDA (b)(c) 4.5 3.1 4.5
Net debt to enterprise value (c)(d) 22 % 14 % 23 %(a)Full debt as of December 31, 2022, 2021 and 2020 shows the principal on
long-term debt, web of trustworthy market value modifications and gross of deferred
financing costs and unamortized reductions of $8.4 million, $8.3 million and $2.5
million, respectively.
(b)For a reconciliation of Adjusted EBITDA to web income see Administration's
Dialogue and Analysis of Financial Scenario and Outcomes of
Operations-Effectivity and Liquidity Indicators .
(c)Net debt is calculated as entire debt a lot much less cash and cash equivalents.
(d)Enterprise value based totally on market capitalization (along with Rayonier, L.P.
"OP" fashions) plus web debt based totally on Rayonier's share worth of $32.96, $40.36, and
$29.38 as of December 31, 2022, 2021 and 2020, respectively.48
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AT-THE-MARKET EQUITY OFFERING PROGRAM (“ATM Program”)
On November 4, 2022 we entered right into a model new distribution settlement with a gaggle of
product sales brokers by the use of which we may promote frequent shares, occasionally, having
an mixture product sales worth of as a lot as $300 million (the "2022 ATM Program"). As of
December 31, 2022, $270.7 million stays obtainable for issuance under the 2022
ATM Program.
The following desk outlines the frequent stock issuance pursuant to our ATM
Functions ({{dollars}} in 1000’s and 1000’s):
12 months Ended December 31,
2022 2021
Shares of frequent stock issued under the ATM Functions 1,579,228 6,357,972
Widespread worth of frequent stock issued under the ATM
Functions $38.05 $37.05
Gross proceeds $60.4 $235.5
Commissions $0.6 $2.4CASH FLOWS
The following desk summarizes our cash flows from working, investing and
financing actions for each of the three years ended December 31 (in 1000's and 1000's
of {{dollars}}):2022 2021 2020
Full cash provided by (used for):
Working actions $269.2 $325.1 $204.2
Investing actions (516.4) (26.3) (213.6)
Financing actions (4.6) (16.3) 27.0
Impression of alternate cost changes on cash (1.9)
(0.9) (0.1)
Change in cash, cash equivalents and restricted cash ($253.7) $281.7 $17.5
CASH PROVIDED BY OPERATING ACTIVITIES
Cash provided by working actions decreased $55.9 million versus the prior
yr primarily as a consequence of lower working outcomes and higher cash taxes paid.
CASH USED FOR INVESTING ACTIVITIES
Cash used for investing actions elevated $490.1 million versus the prior
yr primarily as a consequence of higher cash used for timberland acquisitions
($279.4 million), prior yr web proceeds from the sale of Timber Fund II
timberlands ($154.7 million) and Timber Funds III and IV ($31.0 million), lower
proceeds from Big Inclinations ($25.2 million) and higher precise property
development investments ($1.2 million), partially offset by lower capital
expenditures ($1.2 million) and completely different investing actions ($0.2 million).
CASH USED FOR FINANCING ACTIVITIES
Cash used for financing actions decreased $11.7 million from the prior yr
as a consequence of an increase in web borrowings ($98.6 million), lower distributions to
noncontrolling pursuits in consolidated associates ($89.5 million), make-whole
costs on debt prepayments inside the prior yr ($6.2 million), lower debt issuance
costs ($4.1 million) and reduce distributions to noncontrolling pursuits inside the
working partnership ($0.6 million), partially offset by lower proceeds from
the issuance of frequent shares under the ATM Program ($169.3 million), higher
dividends paid on frequent stock ($12.2 million), lower proceeds from the issuance
of frequent shares under the inducement stock plan ($3.3 million) and can enhance in
share repurchases for tax withholding on vested incentive stock awards ($2.6
million).49
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Desk of ContentsFUTURE USES OF CASH
We anticipate future makes use of of cash to include working capital requirements, principal
and curiosity funds on long-term debt, lease funds, capital expenditures,
precise property development investments, timberland acquisitions, dividends on
Rayonier Inc. frequent shares and distributions on Rayonier, L.P. fashions,
distributions to noncontrolling pursuits, and repurchases of the Agency's
frequent shares to meet completely different commitments.
Important long-term makes use of of cash embody the subsequent (in 1000’s and 1000’s):
Funds Due by Interval
Future makes use of of cash (in 1000's and 1000's) Full 2023 2024-2025 2026-2027 Thereafter
Prolonged-term debt (a) $1,523.1 - $21.9 $501.2 $1,000.0Curiosity funds on long-term debt (b) 388.5 70.0 139.7 115.6 63.2
Working leases - timberland (c) 194.9 8.8 16.8 15.2 154.1
Working leases - PP&E, locations of labor (c) 7.3 1.2 1.9 1.0 3.2Commitments - development duties (d) 32.2 27.0 1.2 0.5 3.5
Commitments - derivatives (e) 5.9 5.5 0.4 - -
Commitments - environmental remediation
(f) 15.6 1.2 10.2 1.4 2.8
Commitments - completely different (g) 1.5 0.8 0.7 - -
Full $2,169.0 $114.5 $192.8 $634.9 $1,226.8
(a)The e-book value of long-term debt, web of deferred financing costs and
unamortized reductions, is presently recorded at $1,514.7 million on our
Consolidated Steadiness Sheets, nevertheless upon maturity the obligation shall be
$1,523.1 million. See Discover 7 – Debt for additional data.
(b)Projected curiosity funds for variable-rate debt had been calculated based totally on
glorious principal portions and charges of curiosity as of December 31, 2022.
(c)Excludes anticipated renewal decisions.
(d)Commitments – development duties primarily consists of funds anticipated to
be made on our Wildlight and Heartwood duties.
(e)Commitments – derivatives characterize funds anticipated to be made on
by-product financial gadgets (worldwide alternate contracts). See Discover 8 –
By-product Financial Units and Hedging Actions for additional
data.
(f)Commitments - environmental remediation represents our estimate of potential
obligation associated to environmental contamination and Pure Helpful useful resource
Damages in Port Gamble, Washington. See Discover 12 - Environmental and Pure
Helpful useful resource Harm Liabilities for additional data.
(g)Commitments – completely different consists of various purchase obligations.
We anticipate to fund future makes use of of cash with a mixture of current cash
balances, cash generated by working actions, the remaining issuances
obtainable under the Agency's ATM Program, Big Inclinations and utilizing our
revolving credit score rating facilities. We contemplate now we have now sufficient sources of funding to
meet our enterprise requirements for the following 12 months and in the long run.
EXPECTED 2023 EXPENDITURES
Capital expenditures in 2023 are forecasted to be between $85 million and
$95 million, excluding any strategic timberland acquisitions we may make.
Capital expenditures are anticipated to primarily embrace seedling planting,
fertilization and completely different silvicultural actions, property taxes, lease
funds, allotted overhead and completely different capitalized costs. Aside from capital
expenditures, we will additionally buy timberland as we actively contemplate acquisition
alternate options.Precise property development investments in 2023 are anticipated to be between
$25 million and $28 million, web of anticipated reimbursements. Anticipated precise
property development investments are primarily related to Wildlight, our mixed-use
neighborhood development problem located north of Jacksonville, Florida and
Heartwood, our mixed-use development problem located in Richmond Hill merely south
of Savannah, Georgia.Our 2023 dividend funds on Rayonier Inc. frequent shares and distributions to
Rayonier, L.P. unitholders are anticipated to be roughly $167.9 million and
$3.7 million, respectively, assuming no change inside the quarterly dividend cost of
$0.285 per share or supplies changes inside the number of frequent shares or
partnership fashions glorious.
Future share repurchases, if any, will rely on the Agency’s liquidity and
cash transfer, along with fundamental market conditions and completely different issues
along with capital allocation priorities.
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We made no discretionary pension contributions in 2022. We anticipate to make
estimated cash contributions in 2023 of roughly $7.6 million with a goal to
fund the Outlined Revenue Plan on a plan termination basis. Furthermore, we
anticipate settling the Additional Revenue Plan with lump sum funds upon
termination of the Outlined Revenue Plan with cash contributions of roughly
$1.3 million. See Discover 18 - Employee Revenue Plans for additional
data.
Cash income tax funds in 2023 are anticipated to be between $5 million and
$9 million, primarily because of New Zealand subsidiary.
OFF-BALANCE SHEET ARRANGEMENTS
We benefit from off-balance sheet preparations to produce credit score rating help for certain
suppliers and distributors in case of their default on very important obligations, and
collateral for glorious claims under our earlier staff' compensation
self-insurance functions. These preparations embrace standby letters of credit score rating
and surety bonds. As part of our ongoing operations, we moreover periodically problem
ensures to third occasions. Off-balance sheet preparations is not going to be thought-about a
provide of liquidity or capital belongings and do not expose us to supplies risks
or supplies unfavorable financial impacts. See Discover 13 - Ensures for
additional data on the letters of credit score rating and surety bonds as of
December 31, 2022.
SUMMARY OF GUARANTOR FINANCIAL INFORMATION
In May 2021, Rayonier, L.P. issued $450 million of two.75% Senior Notes due 2031
(the "Senior Notes due 2031"). Rayonier TRS Holdings Inc., together with
Rayonier Inc. and Rayonier Working Agency LLC agreed to irrevocably, completely
and unconditionally guarantee collectively and severally, the obligations of
Rayonier, L.P. relating to the Senior Notes due 2031. As a fundamental companion of
Rayonier, L.P., Rayonier Inc. consolidates Rayonier, L.P. and has no supplies
property or liabilities except for its curiosity in Rayonier, L.P. These notes are
unsecured and unsubordinated and might rank equally with all completely different unsecured and
unsubordinated indebtedness occasionally glorious.Rayonier, L.P. is a restricted partnership, by which Rayonier Inc. is the general
companion. The working subsidiaries of Rayonier, L.P. conduct all of our
operations. Rayonier, L.P.'s most essential property are its curiosity in
working subsidiaries, which have been excluded inside the desk beneath to eradicate
intercompany transactions between the issuer and guarantors and to exclude
investments in non-guarantors. Consequently, our potential to make required
funds on the notes will rely upon the effectivity of our working subsidiaries
and their potential to distribute funds to us. There are usually not any supplies restrictions
on dividends from the working subsidiaries.The following desk incorporates the summarized stability sheet data for the
consolidated obligor group of debt issued by Rayonier, L.P. for the two years
ended December 31:(in 1000's and 1000's) December 31, 2022 December 31, 2021
Current property $112.2 $335.8
Non-current property 122.8 54.6
Current liabilities 19.8 146.0
Non-current liabilities 2,001.9 1,821.7
On account of non-guarantors 520.4 570.4The following desk incorporates the summarized outcomes of operations data
for the consolidated obligor group of debt issued by Rayonier, L.P. for the two
years ended December 31:(in 1000's and 1000's) December 31, 2022 December 31, 2021
Worth and payments ($28.9) ($27.5)
Working loss (28.9) (27.3)
Net loss (54.3) (69.7)
Revenue from non-guarantors 977.9 1,109.451
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Desk of ContentsLIQUIDITY FACILITIES
See Discover 7 - Debt for information on liquidity facilities and completely different
glorious debt, along with for information on covenants that ought to be met in
reference to our Senior Notes due 2031, Time interval Credit score rating Settlement, Incremental
Time interval Mortgage Settlement, 2021 Incremental Time interval Mortgage Settlement, 2022 Incremental Time interval
Mortgage Settlement and Revolving Credit score rating Facility.
RESTRICTED CASH
See Discover 21 – Restricted Cash for additional information regarding the funds
deposited with a third-party intermediary and cash held in escrow.
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PERFORMANCE AND LIQUIDITY INDICATORS
The dialogue beneath is launched to strengthen the reader's understanding of our
working effectivity, liquidity, potential to generate cash and fulfill rating
firm and creditor requirements. This data consists of two measures of
financial outcomes: Adjusted Earnings sooner than Curiosity, Taxes, Depreciation,
Depletion and Amortization ("Adjusted EBITDA"), and Cash On the market for
Distribution ("CAD"). These measures is not going to be outlined by GAAP and the dialogue
of Adjusted EBITDA and CAD is not going to be alleged to battle with or change any of the
GAAP disclosures described above. Administration considers these measures to be
essential to estimate the enterprise and shareholder values and of our core
segments, and for allocating capital belongings. In addition to, analysts, consumers
and collectors use these measures when analyzing our working effectivity,
financial state of affairs and cash producing potential. Administration makes use of Adjusted EBITDA
as a effectivity measure and CAD as a liquidity measure. Adjusted EBITDA and CAD
as outlined is not going to be akin to equally titled measures reported by completely different
corporations. These measures should not be thought-about in isolation from, and are
not alleged to characterize an alternative to, our outcomes reported in accordance
with GAAP.Adjusted EBITDA is printed as earnings sooner than curiosity, taxes, depreciation,
depletion, amortization, the non-cash value of land and improved development,
non-operating income and expense, working (income) loss attributable to
noncontrolling pursuits in Timber Funds, timber write-offs ensuing from
casualty events, obtain associated to the multi-family condominium difficult sale
attributable to noncontrolling pursuits, costs related to the merger with Pope
Sources, the obtain on funding in Timber Funds, Fund II Timberland
Inclinations and Big Inclinations.
Below is a reconciliation of Net Earnings to Adjusted EBITDA for the three years
ended December 31 (in 1000’s and 1000’s of {{dollars}}):
2022 2021 2020
Net Earnings to Adjusted EBITDA Reconciliation
Net Earnings $122.8 $210.5 $29.8
Working (income) loss attributable to NCI in Timber Funds - (45.6) 11.6
Curiosity, web attributable to NCI in Timber Funds - 0.3 0.5
Earnings tax expense attributable to NCI in Timber Funds - 0.1 0.2
Net income (Excluding NCI in Timber Funds) $122.8 $165.3 $42.1
Curiosity, web and miscellaneous income attributable to Rayonier 33.2 44.3 38.0
Earnings tax expense attributable to Rayonier 9.4 14.6 6.8
Depreciation, depletion and amortization attributable to Rayonier
147.3 143.2 154.7
Non-cash value of land and improved development 28.4 25.0 30.4
Non-operating expense (income) 0.4 - (0.9)
Timber write-offs ensuing from a casualty event attributable to
Rayonier (a)
0.7 - 7.9
Purchase associated to the multi-family condominium difficult sale attributable
to NCI (b)
(11.5) - -
Costs related to the merger with Pope Sources (c) - - 17.2
Purchase on funding in Timber Funds (d) - (7.5) -
Fund II Timberland Inclinations attributable to Rayonier (e) - (10.3) -Big Inclinations (f) (16.6) (44.8) (28.7)
Adjusted EBITDA $314.2 $329.8 $267.4
(a)Timber write-offs ensuing from a casualty event consists of the write-off of
merchantable and pre-merchantable timber amount destroyed by casualty events
which might't be salvaged.
(b)Purchase associated to the multi-family condominium difficult sale attributable to
noncontrolling pursuits represents the obtain acknowledged in reference to the
sale of property by the Bainbridge Landing three approach partnership attributable to
noncontrolling pursuits.
(c)Costs related to the merger with Pope Sources embody licensed, accounting,
due diligence, consulting and completely different costs related to the merger with Pope
Sources.
(d)Purchase on funding in Timber Funds represents the obtain acknowledged on the sale
of rights to deal with two timber funds (Funds III and IV) beforehand managed by
the Agency's Olympic Sources Administration (ORM) subsidiary, along with its
co-investment stake in every funds.
(e)Fund II Timberland Inclinations characterize the disposition of Fund II
Timberland property, which we managed and owned a co-investment stake in.
(f)Big Inclinations are outlined as transactions involving the sale of
timberland that exceed $20 million in measurement and do not have a demonstrable
premium relative to timberland value.53
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The following tables current a reconciliation of Working Earnings (Loss) by
section to Adjusted EBITDA by section for the three years ended December 31 (in
1000's and 1000's of {{dollars}}):
Firm
and
Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Precise Property Shopping for and promoting Totally different Full
2022
Working income $96.6 $15.2 $30.6 - $58.5 $0.4 ($35.5) $165.8Add: Depreciation, depletion and
amortization 60.3 48.0 23.9 - 13.9 - 1.3 147.3
Add: Non-cash value of land and improved
development - - - - 28.4 - - 28.4Add: Timber write-offs ensuing from a
casualty event (a) - 0.7 - - - - - 0.7A lot much less: Purchase associated to the multi-family
condominium difficult sale attributable to
NCI (b) - - - - (11.5) - - (11.5)
A lot much less: Big Inclinations (c) - - - - (16.6) - - (16.6)
Adjusted EBITDA $156.9 $63.9 $54.5 - $72.7 $0.4 ($34.2) $314.2
2021
Working income $66.1 $6.8 $51.5 $63.3 $112.5 $0.1 ($30.6) $269.8
Add: Depreciation, depletion and
amortization 54.1 50.5 27.0 2.4 7.9 - 1.2 143.2
Add: Non-cash value of land and improved
development - - - - 25.0 - - 25.0
A lot much less: Working income attributable to NCI in
Timber Funds (d) - - - (45.6) - - - (45.6)
A lot much less: Purchase on funding in Timber Funds (e) - - - (7.5) - - - (7.5)
A lot much less: Fund II Timberland Inclinations
attributable to Rayonier (f) - - - (10.3) - - - (10.3)A lot much less: Big Inclinations (c) - - - - (44.8) - - (44.8)
Adjusted EBITDA $120.2 $57.3 $78.5 $2.3 $100.7 $0.1 ($29.4) $329.8
2020
Working income (loss) $41.3 ($10.0) $30.0 ($13.2) $72.0 ($0.5) ($45.2) $74.4
Add: Working loss attributable to NCI in
Timber Funds (d) - - - 11.6 - - - 11.6Add: Timber write-offs ensuing from a
casualty event attributable to Rayonier
(a) 6.0 - - 1.8 - - - 7.9
Add: Costs related to the merger with Pope
Sources (g) - - - - - - 17.2 17.2
Add: Depreciation, depletion and
amortization 61.8 47.1 25.0 1.6 17.7 - 1.4 154.7
Add: Non-cash value of land and improved
development - - - - 30.4 - - 30.4A lot much less: Big Inclinations (c) - - - - (28.7) - - (28.7)
Adjusted EBITDA $109.1 $37.1 $55.0 $1.8 $91.4 ($0.5) ($26.6) $267.4(a)Timber write-offs ensuing from a casualty event consists of the write-off of
merchantable and pre-merchantable timber amount destroyed by casualty events
which might't be salvaged.
(b)Purchase associated to the multi-family condominium difficult sale attributable to
noncontrolling pursuits represents the obtain acknowledged in reference to the
sale of property by the Bainbridge Landing three approach partnership attributable to
noncontrolling pursuits.
(c)Big Inclinations are outlined as transactions involving the sale of
timberland that exceed $20 million in measurement and do not have a demonstrable
premium relative to timberland value.
(d)The yr ended December 31, 2021 consists of $41.2 million of income from Fund
II Timberland Inclinations. The yr ended December 31, 2020 incorporates a
$7.3 million loss related to timber write-offs ensuing from casualty events.
(e)Purchase on funding in Timber Funds represents the obtain acknowledged on the sale
of rights to deal with two timber funds (Funds III and IV) beforehand managed by
the Agency's Olympic Sources Administration (ORM) subsidiary, along with its
co-investment stake in every funds.
(f)Fund II Timberland Inclinations characterize the disposition of Fund II
Timberland property, which we managed and owned a co-investment stake in.
(g)Costs related to the merger with Pope Sources embody licensed, accounting,
due diligence, consulting and completely different costs related to the merger with Pope
Sources.54
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Cash On the market for Distribution (CAD) is printed as cash provided by working
actions adjusted for capital spending (excluding timberland acquisitions and
precise property development investments), CAD attributable to noncontrolling
pursuits in Timber Funds, and dealing capital and completely different stability sheet changes.
CAD is a non-GAAP measure of cash generated all through a interval that is obtainable
for frequent stock dividends, distributions to working partnership unitholders,
distributions to noncontrolling pursuits, repurchase of the Agency's frequent
shares, debt low cost, timberland acquisitions and precise property development
investments. In compliance with SEC requirements for non-GAAP measures, we
in the reduction of CAD by mandatory debt repayments, which leads to the measure entitled
"Adjusted CAD." CAD and Adjusted CAD generated in any interval is not going to be basically
indicative of the CAD that could possibly be generated in future intervals.
Below is a reconciliation of Cash Equipped by Working Actions to Adjusted
CAD for the three years ended December 31 (in 1000’s and 1000’s):
2022 2021
2020
Cash provided by working actions $269.2 $325.1 $204.2
Capital expenditures from persevering with operations (a) (74.8) (76.0) (66.5)
Costs related to the merger with Pope Sources (b) - - 17.2
CAD attributable to NCI in Timber Funds -
(12.9) (2.8)
Working capital and completely different stability sheet changes (5.9) (28.4) 10.3
CAD $188.5 $207.8 $162.4
Compulsory debt repayments - (325.0) -
Adjusted CAD $188.5 ($117.2) $162.4Cash used for investing actions ($516.4) ($26.3)
($213.6)
Cash (used for) provided by financing actions ($4.6) ($16.3)
$27.0(a)Capital expenditures exclude timberland acquisitions and precise property
development investments.
(b)Costs related to the merger with Pope Sources embody licensed, accounting,
due diligence, consulting and completely different costs related to the merger with Pope
Sources.
The following desk offers supplemental cash transfer information for the three years
ended December 31 (in 1000’s and 1000’s):
2022 2021 2020
Purchase of timberlands ($458.5) ($179.1) ($24.7)
Precise Property development investments (13.7) (12.5) (6.5)
Distributions to noncontrolling pursuits in consolidated associates (19.4) (109.0) (12.6)55
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