ATLANTA, Oct. 31, 2019 /PRNewswire/ -- Driven
by higher harvest volumes, increased pulpwood pricing in the U.S.
South and fees from its Investment Management business,
CatchMark Timber Trust, Inc. (NYSE: CTT) today reported
strong year-over-year results for the three-month period ended
September 30, 2019 – including solid
increases in total revenues, timber sales, and asset management fee
revenue; a substantially lower net loss; and significantly higher
Adjusted EBITDA.
CatchMark also declared a quarterly cash dividend of
$0.135 per share for its common
stockholders of record on November 26,
2019, payable on December 13,
2019.
Results Overview
In the third quarter 2019, CatchMark:
- Increased total revenues by 7% to $26.4
million, compared to $24.6
million in the third quarter 2018.
- Reduced net loss by 74% to $20.6
million, compared to $78.9
million in the third quarter 2018, primarily due to a
$51.0 million decrease in losses
allocated from the Triple T joint venture.
- Increased Adjusted EBITDA by 44% to $16.5 million, compared to $11.5 million in the third quarter 2018. Harvest
EBITDA increased by 23% to $9.4
million from $7.6 million and
Investment Management EBITDA increased by 166% to $7.3 million from $2.7
million, primarily from Adjusted EBITDA generated by the
Dawsonville Bluffs joint venture.
- Increased harvest volumes to more than 634,000 tons, a 28%
increase compared to second quarter 2019 and a 19% increase
compared to third quarter 2018.
- Increased timber sales by 18% to $19.7
million, compared to $16.7
million in the third quarter 2018.
- Completed a $19.9 million large
disposition of 10,800 acres, recognizing a gain of $7.2 million and paying down debt by $14.8 million with a portion of the proceeds.
Overall, the company paid down a total of $20.1 million in debt during the quarter from
recent large dispositions.
- Sold approximately 1,100 acres of timberlands for $2.3 million, compared to 1,900 acres for
$3.8 million during third quarter
2018.
- Increased asset management fee revenue by 27% to $3.4 million, including earning an
incentive-based promote from the Dawsonville Bluffs joint venture
for exceeding investment hurdles.
- Received $3.8 million in cash
distributions from Dawsonville Bluffs, on completing the
disposition of substantially all of its remaining 4,400 acres of
timberland for $8.7 million. Since
inception in April 2017 through
September 30, 2019, CatchMark had
received $13.3 million in cash
distributions from its $10.5 million
investment in the joint venture.
- Paid a dividend of $0.135 per
share to stockholders on September 13,
2019.
Year-Over-Year Increases
Jerry Barag, CatchMark's Chief
Executive Officer, said: "In meeting our business plan, third
quarter registered across-the-board, year-over-year increases on
revenues, harvest volumes, timber sales, and pulpwood pricing. In
addition, our timber sales pricing continued to beat market
averages. We also met targets for the Investment Management
business related to Dawsonville Bluffs, which has now sold all of
its timberland, as well as the ongoing Triple T Joint Venture.
"CatchMark's superior mill market locations, supply agreements
and delivered wood sales strategy helped continue to drive these
excellent operating results and, in particular, the pricing
premiums achieved over Timber-Mart South averages. During the
quarter, we also stepped up activity in the Pacific Northwest as
planned, harvesting 24,000 tons, comprising 86% sawtimber, from
last year's Bandon acquisition. We anticipate harvesting increased
volumes from our Pacific Northwest timberlands going forward as
compared to full-year 2019 and continuing to improve our overall
sawtimber harvest mix.
"Our Investment Management business has continued to boost
revenue growth, producing predictable and stable cash flow from
timberland properties equal in quality to those in our wholly-owned
portfolio. This certainly is the case with the Triple T joint
venture, which has provided significant asset management
fees. In addition, the Dawsonville Bluffs joint venture has
provided strong investment returns and asset management fees over
its term as well as realizing additional incentive-based promotes
for CatchMark."
Barag added: "Looking ahead, timberland sales remain on course
to meet guidance of $16 million to
$18 million in sales for full-year
2019. We also remain on track to meet our full-year harvest target
of between 2.2 million and 2.4 million tons."
Capital Position
During the three months ended September
30, 2019, CatchMark paid down $20.1
million of its outstanding balance on the multi-draw term
facility, using proceeds from recent large dispositions. These
transactions included a $19.9 million
sale of 10,800 wholly-owned acres in Georgia and Alabama during the quarter, recognizing a
$7.2 million gain. As of September 30, 2019, a total of $185.1 million remained available under
CatchMark's credit facilities – $150.1
million under the multi-draw term facility and $35.0 million under the revolving credit
facility. Net debt to Adjusted EBITDA decreased to 8.6x as of
September 30, 2019 from 10.1x as of
June 30, 2019, reflecting the
full-year impact of asset management fee revenues earned from
Triple T and the pay down of debt.
CatchMark President and Chief Financial Officer Brian Davis said: "We continue to explore
capital recycling opportunities and remain on course to reach net
debt to Adjusted EBITDA ratio below 8.0x by year-end. After
quarter-end, we continued to execute on our active interest rate
management strategy by entering into hedging transactions to blend
and extend existing swaps to lower our already favorable borrowing
costs and extend the average life of our fixed-rate debt. After
these transactions, we have fixed interest rates on $275.0 million of our outstanding debt for an
average term of nine years at a weighted-average rate of
2.17%, before the applicable spread and expected patronage refunds,
as compared to an average term of four years at 2.44% under our
previous swaps."
Share Repurchases
Under CatchMark's $30 million
share repurchase program, the company repurchased approximately
57,600 shares of its common stock for approximately $594,000 in open market transactions during the
third quarter. Year-to-date, the company has repurchased
approximately 329,000 shares for $3.0
million under its share repurchase program. As of
September 30, 2019, CatchMark may
repurchase up to an additional $15.7
million under the program.
Results for Three Months Ended September 30, 2019
CatchMark's revenues for the three months ended September 30, 2019 were $26.4 million, $1.8
million higher than the three months ended September 30, 2018 primarily as a result of a
$3.0 million increase in timber sales
revenue and a $0.7 million increase
in asset management fee revenue, offset by a $1.6 million decrease in timberland sales revenue
from fewer acres sold. Timber sales revenue increased by
$3.0 million, or 18%, primarily due
to a 19% increase in harvest volume, a higher sawtimber mix and a
3% increase in pulpwood pricing in the U.S. South, offset by a 15%
decrease in delivered sales as a percentage of total
volume. Harvest volume in the U.S. South was higher than third
quarter 2018 from harvest deferrals in the prior year quarter in
anticipation of a better pricing environment, which was realized in
subsequent periods. Delivered sales mix decreased from prior year
quarter primarily as a result of capitalizing on advantageous
stumpage and lump sum transactions. A 24,000-ton harvest from the
Bandon property in the Pacific Northwest contributed $1.8 million to timber sales revenue.
|
Three Months
Ended
September 30, 2018
|
|
Changes
attributable to:
|
|
Three Months
Ended
September 30, 2019
|
(in
thousands)
|
|
Price/Mix
|
|
Volume
(3)
|
|
Timber sales
(1)
|
|
|
|
|
|
|
|
Pulpwood
|
$
|
9,359
|
|
|
$
|
353
|
|
|
$
|
44
|
|
|
$
|
9,756
|
|
Sawtimber
(2)
|
7,383
|
|
|
688
|
|
|
1,879
|
|
|
9,950
|
|
|
$
|
16,742
|
|
|
$
|
1,041
|
|
|
$
|
1,923
|
|
|
$
|
19,706
|
|
|
(1)
Timber sales are presented on a gross basis. Timber sales revenue
from delivered sales includes logging and
hauling costs that customers pay for
deliveries.
|
(2)
Includes chip-n-saw and sawtimber.
|
(3)
Changes in timber sales revenue related to properties acquired or
disposed within the last 12 months are
attributed to volume
changes.
|
Net loss decreased to $20.6
million for the three months ended September 30, 2019 from $78.9 million for the three months ended
September 30, 2018 primarily due to a
$51.0 million decrease in losses
allocated from the Triple T joint venture under the HLBV method and
a $7.2 million gain recognized on
large dispositions.
Results for the Nine Months Ended September 30, 2019
Revenues for the nine months ended September 30, 2019 were $77.6 million, $2.7
million higher than the nine months ended September 30, 2018 as a result of a $6.4 million increase in asset management fee
revenue primarily earned from the Triple T joint venture, offset by
a $2.3 million decrease in timberland
sales revenue from fewer acres sold, a $0.7
million decrease in other revenue and a $0.6 million decrease in timber sales. Timber
sales revenue decreased due to a 3% decrease in harvest volume
mitigated by 3% increases in both pulpwood and sawtimber stumpage
prices in the U.S. South. Harvest volume in the U.S. South
decreased by 6% as a result of previous wet weather and mill
outages, as anticipated in the 2019 harvest plan. In the Pacific
Northwest, we harvested 43,000 tons from the Bandon property, which
contributed $3.5 million to gross
timber sales revenue.
|
Nine Months
Ended
September 30,
2018
|
|
Changes
attributable to:
|
|
Nine Months
Ended
September 30,
2019
|
(in
thousands)
|
|
Price/Mix
|
|
Volume
(3)
|
|
Timber sales
(1)
|
|
|
|
|
|
|
|
Pulpwood
|
$
|
29,294
|
|
|
$
|
853
|
|
|
$
|
(3,419)
|
|
|
$
|
26,728
|
|
Sawtimber
(2)
|
23,846
|
|
|
196
|
|
|
1,760
|
|
|
25,802
|
|
|
$
|
53,140
|
|
|
$
|
1,049
|
|
|
$
|
(1,659)
|
|
|
$
|
52,530
|
|
|
(1)
Timber sales are presented on a gross basis. Timber sales revenue
from delivered sales includes logging and
hauling costs that customers pay for
deliveries.
|
(2)
Includes chip-n-saw and sawtimber.
|
(3)
Changes in timber sales revenue related to properties acquired or
disposed within the last 12 months are
attributed to volume
changes.
|
Net loss decreased to $81.5
million for the nine months ended September 30, 2019 from $83.8 million for the nine months ended
September 30, 2018 primarily due to
recognizing an $8.0 million gain from
large dispositions, a $2.7 million
increase in revenues and a $1.1
million decrease in expenses, offset by a $2.7 million increase in interest expense and a
$6.8 million increase in loss from
unconsolidated joint ventures.
Adjusted EBITDA
The discussion below is intended to enhance the reader's
understanding of our operating performance and ability to satisfy
lender requirements. EBITDA is a non-GAAP financial measure of
operating performance. EBITDA is defined by the SEC as earnings
before interest, taxes, depreciation and amortization; however, we
have excluded certain other expenses which we believe are not
indicative of the ongoing operating results of our timberland
portfolio, and we refer to this measure as Adjusted EBITDA (see the
reconciliation table below). As such, our Adjusted EBITDA may not
be comparable to similarly titled measures reported by other
companies. Due to the significant amount of timber assets subject
to depletion, significant income (loss) from unconsolidated joint
ventures based on hypothetical-liquidation-at-book-value (HLBV) and
the significant amount of financing subject to interest and
amortization expense, management considers Adjusted EBITDA to be an
important measure of our financial performance. HLBV accounting is
a method of determining an investor's equity in earnings of an
unconsolidated joint venture based on a hypothetical liquidation of
the underlying joint venture at book value as of the reporting
date. The HLBV method is commonly applied to equity investments in
real estate, where cash distribution percentages vary at different
points in time and are not directly linked to an investor's
ownership percentage. By providing this non-GAAP financial measure,
together with the reconciliation below, we believe we are enhancing
investors' understanding of our business and our ongoing results of
operations, as well as assisting investors in evaluating how well
we are executing our strategic initiatives. Items excluded from
Adjusted EBITDA are significant components in understanding and
assessing financial performance. Adjusted EBITDA is a supplemental
measure of operating performance that does not represent and should
not be considered in isolation or as an alternative to, or
substitute for net income, cash from operations, or other financial
statement data presented in accordance with GAAP in our
consolidated financial statements as indicators of our operating
performance. Adjusted EBITDA has limitations as an analytical tool
and should not be considered in isolation or as a substitute for
analysis of our results as reported under U.S. GAAP. Some of the
limitations are:
- Adjusted EBITDA does not reflect our capital expenditures, or
our future requirements for capital expenditures;
- Adjusted EBITDA does not reflect changes in, or our interest
expense or the cash requirements necessary to service interest or
principal payments on, our debt;
- Although depletion is a non-cash charge, we will incur expenses
to replace the timber being depleted in the future, and Adjusted
EBITDA does not reflect all cash requirements for such expenses;
and
- Although HLBV income and losses are primarily hypothetical and
non-cash in nature, Adjusted EBITDA does not reflect cash income or
losses from unconsolidated joint ventures for which the HLBV method
of accounting is used to determine equity in earnings.
Due to these limitations, Adjusted EBITDA should not be
considered as a measure of discretionary cash available to us to
invest in the growth of our business. Our credit agreement contains
a minimum debt service coverage ratio based, in part, on Adjusted
EBITDA since this measure is representative of adjusted income
available for interest payments. We further believe that our
presentation of this non-GAAP financial measurement provides
information that is useful to analysts and investors because they
are important indicators of the strength of our operations and the
performance of our business.
For the three months ended September 30,
2019, Adjusted EBITDA was $16.5
million, a $5.1 million
increase from the three months ended September 30, 2018, primarily due to a
$3.8 million increase in Adjusted
EBITDA generated by the Dawsonville Bluffs joint venture, a
$2.3 million increase in net timber
sales and a $0.7 million increase in
asset management fee revenue, offset by a $1.5 million decrease in net timberland
sales.
For the nine months ended September 30,
2019, Adjusted EBITDA was $41.8
million, a $1.4 million
increase from the nine months ended September 30, 2018, primarily due to a
$6.4 million increase in asset
management fee revenue, offset by a $2.2
million decrease in net timberland sales, a $2.1 million decrease in Adjusted EBITDA
generated by the Dawsonville Bluffs joint venture and a
$0.7 million decrease in other
revenue.
Our reconciliation of net loss to Adjusted EBITDA for the three
months and nine months ended September 30,
2019 and 2018 follows:
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
(in
thousands)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net
loss
|
|
$
|
(20,557)
|
|
|
$
|
(78,899)
|
|
|
$
|
(81,517)
|
|
|
$
|
(83,789)
|
|
Add:
|
|
|
|
|
|
|
|
|
Depletion
|
|
8,235
|
|
|
6,224
|
|
|
19,533
|
|
|
19,884
|
|
Basis of timberland
sold, lease terminations and other (1)
|
|
1,854
|
|
|
2,983
|
|
|
10,329
|
|
|
10,771
|
|
Amortization
(2)
|
|
299
|
|
|
493
|
|
|
986
|
|
|
2,532
|
|
Depletion,
amortization, and basis of timberland and mitigation credits
sold
included in loss from unconsolidated joint venture
(3)
|
|
3,152
|
|
|
39
|
|
|
3,547
|
|
|
3,885
|
|
HLBV loss from
unconsolidated joint venture (4)
|
|
25,712
|
|
|
76,755
|
|
|
81,800
|
|
|
76,755
|
|
Stock-based
compensation expense
|
|
803
|
|
|
610
|
|
|
1,952
|
|
|
2,171
|
|
Interest expense
(2)
|
|
4,220
|
|
|
3,883
|
|
|
12,987
|
|
|
8,754
|
|
Gain on large
dispositions (5)
|
|
(7,197)
|
|
|
—
|
|
|
(7,961)
|
|
|
—
|
|
Other
(6)
|
|
1
|
|
|
(632)
|
|
|
115
|
|
|
(597)
|
|
Adjusted
EBITDA
|
|
$
|
16,522
|
|
|
$
|
11,456
|
|
|
$
|
41,771
|
|
|
$
|
40,366
|
|
|
(1)
Includes non-cash basis of timber and timberland assets written-off
related to timberland sold, terminations of timberland leases and
casualty losses.
|
(2)
For the purpose of the above reconciliation, amortization includes
amortization of deferred financing costs, amortization of operating
lease assets and liabilities, amortization
of intangible lease assets, and
amortization of mainline road costs, which are included in either
interest expense, land rent expense, or other operating
expenses in the
consolidated statements of
operations.
|
(3)
Reflects our share of depletion, amortization, and basis of
timberland and mitigation credits sold of the unconsolidated
Dawsonville Bluffs joint venture.
|
(4)
Reflects HLBV (income) losses from the Triple T joint venture,
which is determined based on a hypothetical liquidation of the
underlying joint venture at book value as of the
reporting date.
|
(5)
Large dispositions are sales of large blocks of timberland
properties in one or several transactions with the objective to
generate proceeds to fund capital allocation priorities.
Large dispositions are typically
larger transactions in acreage and gross sales price than recurring
HBU sales and are not part of core operations, are infrequent in
nature
and would cause material variances in
comparative results if not reported separately. Large dispositions
may or may not have a higher or better use than timber
production
or result in a price premium above
the land's timber production value.
|
(6)
Includes certain cash expenses paid, or reimbursement received,
that management believes do not directly reflect the core business
operations of our timberland portfolio on an
on-going basis, including costs
required to be expensed by GAAP related to acquisitions,
transactions, joint ventures or new business
initiatives.
|
Conference Call
The company will host a conference
call and live webcast at 10 a.m. ET on Friday, November 1, 2019 to discuss these
results. Investors may listen to the conference call by
dialing 1-888-347-1165 for U.S/Canada and 1-412-902-4276 for international
callers. Participants should ask to be joined into the
CatchMark call. Access to the live webcast will be available at
www.catchmark.com. A replay of this webcast will be archived
on the company's website shortly after the call.
About CatchMark
CatchMark (NYSE: CTT) seeks to deliver
consistent and growing per share cash flow from disciplined
acquisitions and superior management of prime timberlands located
in high demand U.S. mill markets. Concentrating on maximizing
cash flows throughout business cycles, the company strategically
harvests its high-quality timberlands to produce durable revenue
growth and takes advantage of proximate mill markets, which provide
a reliable outlet for merchantable inventory. Headquartered in
Atlanta and focused exclusively on timberland ownership and
management, CatchMark began operations in 2007 and owns interests
in 1.5 million acres* of timberlands located in Alabama, Florida, Georgia, North
Carolina, Oregon,
South Carolina, Tennessee and
Texas. For more information, visit
www.catchmark.com.
* As of September 30, 2019
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, as amended.
Such forward-looking statements can generally be identified by our
use of forward-looking terminology such as "may," "will," "expect,"
"intend," "anticipate," "estimate," "believe," "continue," or other
similar words. However, the absence of these or similar words or
expressions does not mean that a statement is not forward-looking.
Forward-looking statements are not guarantees of performance and
are based on certain assumptions, discuss future expectations,
describe plans and strategies, contain projections of results of
operations or of financial condition or state other forward-looking
information. Forward-looking statements in this report include that
we anticipate harvesting increased volumes in the Pacific
Northwest, that we remain on track to meet our timberland sales and
harvest volume targets for 2019, that we remain on course to reach
a net debt to Adjusted EBITDA ratio below 8.0x by year end;
that our disciplined acquisitions of the highest quality
timberlands will produce durable revenue growth; that our locations
in high-demand mill markets will provide reliable outlets for
available merchantable inventory at favorable pricing; and that our
superior management seeks to maximize cash flow throughout the
business cycle. Risks and uncertainties that could cause our actual
results to differ from these forward-looking statements include,
but are not limited to, (i) we may not generate the harvest
volumes from our timberlands that we currently anticipate; (ii) the
demand for our timber may not increase at the rate we currently
anticipate or at all due to changes in general economic and
business conditions in the geographic regions where our timberlands
are located; (iii) the cyclical nature of the real estate market
generally, including fluctuations in demand and valuations, may
adversely impact our ability to generate income and cash flow from
sales of higher-and-better use properties; (iv) timber prices may
not increase at the rate we currently anticipate or could decline,
which would negatively impact our revenues; (v) the supply of
timberlands available for acquisition that meet our investment
criteria may be less than we currently anticipate; (vi) we may be
unsuccessful in winning bids for timberland that are sold through
an auction process; (vii) we may not be able sell large
dispositions of timberland in capital recycling transactions at
prices that are attractive to us or at all; (viii) we may not be
able to access external sources of capital at attractive rates or
at all; (ix) potential increases in interest rates could have a
negative impact on our business; (x) our share repurchase program
may not be successful in improving stockholder value over the
long-term; (xi) our joint venture strategy may not enable us to
access non-dilutive capital and enhance our ability to make
acquisitions; (xii) we may not be successful in effectively
managing the Triple T joint venture and the anticipated benefits of
the joint venture may not be realized, including that our asset
management fee could be deferred or decreased, we may not earn an
incentive-based promote and our investment in the joint venture may
lose value; and (xiii) the factors described in Part I, Item 1A.
Risk Factors of our Annual Report on Form 10-K for the fiscal year
ended December 31, 2018 and our other
filings with the Securities and Exchange Commission. Accordingly,
readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. We undertake no obligation to update our
forward-looking statements, except as required by
law.
CATCHMARK TIMBER
TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands,
except for per-share amounts)
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Revenues:
|
|
|
|
|
|
|
|
Timber
sales
|
$
|
19,706
|
|
|
$
|
16,742
|
|
|
$
|
52,530
|
|
|
$
|
53,140
|
|
Timberland
sales
|
2,264
|
|
|
3,818
|
|
|
12,578
|
|
|
14,904
|
|
Asset management
fees
|
3,436
|
|
|
2,698
|
|
|
9,119
|
|
|
2,759
|
|
Other
revenues
|
974
|
|
|
1,319
|
|
|
3,386
|
|
|
4,127
|
|
|
26,380
|
|
|
24,577
|
|
|
77,613
|
|
|
74,930
|
|
Expenses:
|
|
|
|
|
|
|
|
Contract logging and
hauling costs
|
8,269
|
|
|
7,613
|
|
|
22,778
|
|
|
24,154
|
|
Depletion
|
8,235
|
|
|
6,224
|
|
|
19,533
|
|
|
19,884
|
|
Cost of timberland
sales
|
2,081
|
|
|
3,210
|
|
|
10,562
|
|
|
11,590
|
|
Forestry management
expenses
|
1,656
|
|
|
1,370
|
|
|
4,982
|
|
|
4,622
|
|
General and
administrative expenses
|
2,984
|
|
|
2,484
|
|
|
9,550
|
|
|
8,602
|
|
Land rent
expense
|
125
|
|
|
153
|
|
|
400
|
|
|
490
|
|
Other operating
expenses
|
1,341
|
|
|
1,356
|
|
|
4,614
|
|
|
4,197
|
|
|
24,691
|
|
|
22,410
|
|
|
72,419
|
|
|
73,539
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest
income
|
80
|
|
|
20
|
|
|
142
|
|
|
180
|
|
Interest
expense
|
(4,472)
|
|
|
(4,321)
|
|
|
(13,803)
|
|
|
(11,125)
|
|
Gain on large
dispositions
|
7,197
|
|
|
—
|
|
|
7,961
|
|
|
—
|
|
|
2,805
|
|
|
(4,301)
|
|
|
(5,700)
|
|
|
(10,945)
|
|
|
|
|
|
|
|
|
|
Income (loss)
before unconsolidated joint ventures
|
4,494
|
|
|
(2,134)
|
|
|
(506)
|
|
|
(9,554)
|
|
Income (loss) from
unconsolidated joint ventures:
|
|
|
|
|
|
|
|
Triple T
|
(25,712)
|
|
|
(76,755)
|
|
|
(81,800)
|
|
|
(76,755)
|
|
Dawsonville
Bluffs
|
661
|
|
|
(10)
|
|
|
789
|
|
|
2,520
|
|
|
(25,051)
|
|
|
(76,765)
|
|
|
(81,011)
|
|
|
(74,235)
|
|
|
|
|
|
|
|
|
|
Net
loss
|
$
|
(20,557)
|
|
|
$
|
(78,899)
|
|
|
$
|
(81,517)
|
|
|
$
|
(83,789)
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding - basic and diluted
|
49,008
|
|
|
49,118
|
|
|
49,049
|
|
|
47,551
|
|
|
|
|
|
|
|
|
|
Net loss per-share
- basic and diluted
|
$
|
(0.42)
|
|
|
$
|
(1.61)
|
|
|
$
|
(1.66)
|
|
|
$
|
(1.76)
|
|
CATCHMARK TIMBER
TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
(in thousands,
except for per-share amounts)
|
|
|
|
(Unaudited)
September 30,
2019
|
|
December 31,
2018
|
Assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
17,074
|
|
|
$
|
5,614
|
|
Accounts
receivable
|
4,519
|
|
|
7,355
|
|
Prepaid expenses and
other assets
|
4,591
|
|
|
7,369
|
|
Operating lease
right-of-use asset, less accumulated amortization of $209
as of September 30, 2019
|
3,191
|
|
|
—
|
|
Deferred financing
costs
|
266
|
|
|
327
|
|
Timber
assets:
|
|
|
|
Timber and
timberlands, net
|
643,663
|
|
|
687,851
|
|
Intangible lease
assets, less accumulated amortization of $948 and $945 as
of September 30, 2019 and December 31, 2018,
respectively
|
9
|
|
|
12
|
|
Investments in
unconsolidated joint ventures
|
10,425
|
|
|
96,244
|
|
Total
assets
|
$
|
683,738
|
|
|
$
|
804,772
|
|
|
|
|
|
Liabilities:
|
|
|
|
Accounts payable and
accrued expenses
|
$
|
5,047
|
|
|
$
|
4,936
|
|
Operating lease
liability
|
3,302
|
|
|
—
|
|
Other
liabilities
|
17,636
|
|
|
5,940
|
|
Notes payable and
lines of credit, net of deferred financing costs
|
452,768
|
|
|
472,240
|
|
Total
liabilities
|
478,753
|
|
|
483,116
|
|
|
|
|
|
Commitments and
Contingencies
|
—
|
|
|
—
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
Class A common stock,
$0.01 par value; 900,000 shares authorized; 49,007
and 49,127 shares issued and outstanding as of September 30, 2019
and
December 31, 2018, respectively
|
490
|
|
|
492
|
|
Additional paid-in
capital
|
729,000
|
|
|
730,416
|
|
Accumulated deficit
and distributions
|
(510,488)
|
|
|
(409,260)
|
|
Accumulated other
comprehensive income (loss)
|
(14,017)
|
|
|
8
|
|
Total stockholders'
equity
|
204,985
|
|
|
321,656
|
|
Total liabilities and
stockholders' equity
|
$
|
683,738
|
|
|
$
|
804,772
|
|
CATCHMARK TIMBER
TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS (UNAUDITED)
(in
thousands)
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
|
|
Net loss
|
$
|
(20,557)
|
|
|
$
|
(78,899)
|
|
|
$
|
(81,517)
|
|
|
$
|
(83,789)
|
|
Adjustments to
reconcile net loss to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depletion
|
8,235
|
|
|
6,224
|
|
|
19,533
|
|
|
19,884
|
|
Basis of timberland
sold, lease terminations and other
|
1,854
|
|
|
2,983
|
|
|
10,329
|
|
|
10,771
|
|
Stock-based
compensation expense
|
803
|
|
|
610
|
|
|
1,952
|
|
|
2,171
|
|
Noncash interest
expense
|
252
|
|
|
438
|
|
|
816
|
|
|
2,371
|
|
Other
amortization
|
47
|
|
|
54
|
|
|
170
|
|
|
160
|
|
Loss from
unconsolidated joint ventures
|
25,051
|
|
|
76,765
|
|
|
81,011
|
|
|
74,235
|
|
Operating
distributions from unconsolidated joint ventures
|
661
|
|
|
(10)
|
|
|
789
|
|
|
3,658
|
|
Gain on large
dispositions
|
(7,197)
|
|
|
—
|
|
|
(7,961)
|
|
|
—
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
1,972
|
|
|
(3,055)
|
|
|
2,007
|
|
|
(2,643)
|
|
Prepaid expenses and
other assets
|
(420)
|
|
|
3,158
|
|
|
221
|
|
|
(295)
|
|
Accounts payable and
accrued expenses
|
47
|
|
|
1,231
|
|
|
138
|
|
|
1,627
|
|
Other
liabilities
|
560
|
|
|
(551)
|
|
|
1,025
|
|
|
1,121
|
|
Net cash provided by
operating activities
|
11,308
|
|
|
8,948
|
|
|
28,513
|
|
|
29,271
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
|
|
Timberland
acquisitions and earnest money paid
|
—
|
|
|
(57,827)
|
|
|
—
|
|
|
(91,424)
|
|
Capital expenditures
(excluding timberland acquisitions)
|
(834)
|
|
|
(704)
|
|
|
(3,031)
|
|
|
(2,821)
|
|
Investment in
unconsolidated joint ventures
|
—
|
|
|
(200,000)
|
|
|
—
|
|
|
(200,000)
|
|
Distributions from
unconsolidated joint ventures
|
3,172
|
|
|
1,296
|
|
|
4,019
|
|
|
4,858
|
|
Net proceeds from
large dispositions
|
19,840
|
|
|
—
|
|
|
25,151
|
|
|
—
|
|
Net cash provided by
(used in) investing activities
|
22,178
|
|
|
(257,235)
|
|
|
26,139
|
|
|
(289,387)
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
|
|
Repayments of note
payable
|
(20,064)
|
|
|
—
|
|
|
(20,064)
|
|
|
(69,000)
|
|
Proceeds from note
payable
|
—
|
|
|
259,000
|
|
|
—
|
|
|
289,000
|
|
Financing costs
paid
|
(15)
|
|
|
(729)
|
|
|
(48)
|
|
|
(832)
|
|
Issuance of common
stock
|
—
|
|
|
—
|
|
|
—
|
|
|
72,450
|
|
Other offering costs
paid
|
—
|
|
|
(33)
|
|
|
—
|
|
|
(3,623)
|
|
Dividends paid to
common stockholders
|
(6,555)
|
|
|
(6,601)
|
|
|
(19,711)
|
|
|
(19,013)
|
|
Repurchases of common
shares under the share repurchase
|
(595)
|
|
|
—
|
|
|
(3,004)
|
|
|
—
|
|
Repurchase of common
shares for minimum tax withholdings
|
—
|
|
|
(123)
|
|
|
(365)
|
|
|
(1,348)
|
|
Net cash provided by
(used in) financing activities
|
(27,229)
|
|
|
251,514
|
|
|
(43,192)
|
|
|
267,634
|
|
Net change in cash
and cash equivalents
|
6,257
|
|
|
3,227
|
|
|
11,460
|
|
|
7,518
|
|
Cash and cash
equivalents, beginning of period
|
10,817
|
|
|
12,096
|
|
|
5,614
|
|
|
7,805
|
|
Cash and cash
equivalents, end of period
|
$
|
17,074
|
|
|
$
|
15,323
|
|
|
$
|
17,074
|
|
|
$
|
15,323
|
|
CATCHMARK TIMBER
TRUST, INC. AND SUBSIDIARIES
SELECTED DATA
(UNAUDITED)
|
|
|
|
2019
|
|
2018
|
|
Q1
|
|
Q2
|
|
Q3
|
|
YTD
|
|
Q1
|
|
Q2
|
|
Q3
|
|
YTD
|
Timber Sales
Volume ('000 tons) (1)
|
|
|
|
|
|
|
|
|
|
|
Pulpwood
|
294
|
|
|
303
|
|
|
373
|
|
|
970
|
|
|
354
|
|
|
342
|
|
|
343
|
|
|
1,039
|
|
Sawtimber
(2)
|
188
|
|
|
177
|
|
|
237
|
|
|
602
|
|
|
221
|
|
|
219
|
|
|
185
|
|
|
625
|
|
Total
|
482
|
|
|
480
|
|
|
610
|
|
|
1,572
|
|
|
575
|
|
|
561
|
|
|
528
|
|
|
1,664
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harvest Mix
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pulpwood
|
61
|
%
|
|
63
|
%
|
|
61
|
%
|
|
62
|
%
|
|
62
|
%
|
|
61
|
%
|
|
65
|
%
|
|
62
|
%
|
Sawtimber
(2)
|
39
|
%
|
|
37
|
%
|
|
39
|
%
|
|
38
|
%
|
|
38
|
%
|
|
39
|
%
|
|
35
|
%
|
|
38
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delivered % as of
total volume (1)
|
79
|
%
|
|
74
|
%
|
|
64
|
%
|
|
72
|
%
|
|
83
|
%
|
|
80
|
%
|
|
78
|
%
|
|
81
|
%
|
Stumpage % as of
total volume
|
21
|
%
|
|
26
|
%
|
|
36
|
%
|
|
28
|
%
|
|
17
|
%
|
|
20
|
%
|
|
22
|
%
|
|
19
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Timber
Sales Price ($ per ton) (1)
|
|
|
|
|
|
|
|
|
|
|
Pulpwood
|
$
|
15
|
|
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
13
|
|
|
$
|
13
|
|
|
$
|
14
|
|
Sawtimber
(2)
|
$
|
24
|
|
|
$
|
24
|
|
|
$
|
24
|
|
|
$
|
24
|
|
|
$
|
23
|
|
|
$
|
24
|
|
|
$
|
24
|
|
|
$
|
24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Timberland
Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Sales
('000)
|
$
|
2,090
|
|
|
$
|
8,224
|
|
|
$
|
2,264
|
|
|
$
|
12,578
|
|
|
$
|
4,252
|
|
|
$
|
6,834
|
|
|
$
|
3,818
|
|
|
$
|
14,904
|
|
Acres Sold
|
900
|
|
|
4,000
|
|
|
1,100
|
|
|
6,000
|
|
|
2,200
|
|
|
3,100
|
|
|
1,900
|
|
|
7,200
|
|
% of fee
acres
|
0.2
|
%
|
|
0.9
|
%
|
|
0.2
|
%
|
|
1.4
|
%
|
|
0.5
|
%
|
|
0.7
|
%
|
|
0.4
|
%
|
|
1.5
|
%
|
Price per
acre
|
$
|
2,236
|
|
|
$
|
2,072
|
|
|
$
|
2,166
|
|
|
$
|
2,114
|
|
|
$
|
1,955
|
|
|
$
|
2,199
|
|
|
$
|
1,967
|
|
|
$
|
2,063
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
Timberland Acquisitions, Exclusive of Transaction
Costs
|
|
|
|
|
|
|
|
|
|
|
Gross Acquisitions
('000)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
89,700
|
|
|
$
|
89,700
|
|
Acres
Acquired
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,100
|
|
|
18,100
|
|
Price per acre
($/acre)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,956
|
|
|
$
|
4,956
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joint Ventures'
Timberland Acquisitions, Exclusive of
Transaction Costs (3)
|
|
|
|
|
|
|
|
|
|
|
Gross Acquisitions
('000)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,389,500
|
|
|
$
|
1,389,500
|
|
Acres
Acquired
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,099,800
|
|
|
1,099,800
|
|
Price per acre
($/acre)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,263
|
|
|
$
|
1,263
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Large
Dispositions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Sales
('000)
|
$
|
—
|
|
|
$
|
5,475
|
|
|
$
|
19,920
|
|
|
$
|
25,395
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Acres Sold
|
—
|
|
|
3,600
|
|
|
10,800
|
|
|
14,400
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Price per
acre
|
$
|
—
|
|
|
$
|
1,500
|
|
|
$
|
1,845
|
|
|
$
|
1,758
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Gain on large
dispositions ('000)
|
$
|
—
|
|
|
$
|
764
|
|
|
$
|
7,197
|
|
|
$
|
7,961
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Period-end
acres ('000)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fee
|
432
|
|
|
424
|
|
|
413
|
|
|
413
|
|
|
477
|
|
|
474
|
|
|
490
|
|
|
490
|
|
Lease
|
27
|
|
|
26
|
|
|
26
|
|
|
26
|
|
|
31
|
|
|
30
|
|
|
30
|
|
|
30
|
|
Wholly-Owned
Total
|
459
|
|
|
450
|
|
|
439
|
|
|
439
|
|
|
508
|
|
|
504
|
|
|
520
|
|
|
520
|
|
Joint Venture
Interest (3)
|
1,100
|
|
|
1,100
|
|
|
1,094
|
|
|
1,094
|
|
|
6
|
|
|
6
|
|
|
1,106
|
|
|
1,106
|
|
Total
|
1,559
|
|
|
1,550
|
|
|
1,533
|
|
|
1,533
|
|
|
514
|
|
|
510
|
|
|
1,626
|
|
|
1,626
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Excludes approximately 4,800 tons, 14,500 tons and 24,000 tons
harvested in the first three quarters of 2019, and approximately
2,100 tons harvested in the third quarter of 2018, respectively,
from the Bandon Property
in the Pacific Northwest. The Bandon
Property was acquired at the end of August 2018. Total volume
harvested from the Bandon Property for the nine months ended
September 30, 2019 accounted for less than 3% of
our total harvest volume.
|
(2)
Includes chip-n-saw and sawtimber.
|
(3)
Represents properties owned Triple T Joint Venture in which
CatchMark owns a 21.6% equity interest; and Dawsonville Bluffs,
LLC, a joint venture in which CatchMark owns a 50% membership
interest. CatchMark
serves as the manager for both of
these joint ventures.
|
CATCHMARK TIMBER
TRUST, INC. AND SUBSIDIARIES
ADJUSTED EBITDA BY
SEGMENT (UNAUDITED)
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Timber
sales
|
$
|
19,706
|
|
|
$
|
16,742
|
|
|
$
|
52,530
|
|
|
$
|
53,140
|
|
Other
revenue
|
|
974
|
|
|
|
1,319
|
|
|
|
3,386
|
|
|
|
4,127
|
|
(-)
Contract logging and hauling costs
|
|
(8,269)
|
|
|
|
(7,613)
|
|
|
|
(22,778)
|
|
|
|
(24,154)
|
|
(-)
Forestry management expenses
|
|
(1,656)
|
|
|
|
(1,370)
|
|
|
|
(4,982)
|
|
|
|
(4,622)
|
|
(-)
Land rent expense
|
|
(125)
|
|
|
|
(153)
|
|
|
|
(400)
|
|
|
|
(490)
|
|
(-)
Other operating expenses
|
|
(1,341)
|
|
|
|
(1,356)
|
|
|
|
(4,614)
|
|
|
|
(4,197)
|
|
(+)
Stock-based compensation
|
|
74
|
|
|
|
23
|
|
|
|
189
|
|
|
|
310
|
|
(+/-)
Other
|
|
27
|
|
|
|
43
|
|
|
|
604
|
|
|
|
225
|
|
Harvest
EBITDA
|
|
9,390
|
|
|
|
7,635
|
|
|
|
23,935
|
|
|
|
24,339
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Timberland
sales
|
|
2,264
|
|
|
|
3,818
|
|
|
|
12,578
|
|
|
|
14,904
|
|
(-)
Cost of timberland sales
|
|
(2,081)
|
|
|
|
(3,210)
|
|
|
|
(10,562)
|
|
|
|
(11,590)
|
|
(+) Basis
of timberland sold
|
|
1,853
|
|
|
|
2,984
|
|
|
|
9,805
|
|
|
|
10,674
|
|
Real estate
EBITDA
|
|
2,036
|
|
|
|
3,592
|
|
|
|
11,821
|
|
|
|
13,988
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset management
fees
|
|
3,436
|
|
|
|
2,698
|
|
|
|
9,119
|
|
|
|
2,759
|
|
Unconsolidated
Dawsonville Bluffs joint venture EBITDA
|
|
3,814
|
|
|
|
29
|
|
|
|
4,336
|
|
|
|
6,405
|
|
Investment
management EBITDA
|
|
7,250
|
|
|
|
2,727
|
|
|
|
13,455
|
|
|
|
9,164
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
EBITDA
|
|
18,676
|
|
|
|
13,954
|
|
|
|
49,211
|
|
|
|
47,491
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(-)
General and administrative expenses
|
|
(2,984)
|
|
|
|
(2,484)
|
|
|
|
(9,550)
|
|
|
|
(8,602)
|
|
(+)
Stock-based compensation
|
|
729
|
|
|
|
587
|
|
|
|
1,763
|
|
|
|
1,861
|
|
(+)
Interest income
|
|
80
|
|
|
|
20
|
|
|
|
142
|
|
|
|
180
|
|
(+/-)
Other
|
|
21
|
|
|
|
(621)
|
|
|
|
205
|
|
|
|
(564)
|
|
Non-allocated/corporate EBITDA
|
|
(2,154)
|
|
|
|
(2,498)
|
|
|
|
(7,440)
|
|
|
|
(7,125)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$
|
16,522
|
|
|
$
|
11,456
|
|
|
$
|
41,771
|
|
|
$
|
40,366
|
|
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multimedia:http://www.prnewswire.com/news-releases/catchmark-reports-third-quarter-2019-results-declares-dividend-300949390.html
SOURCE CatchMark Timber Trust, Inc.