Deltic Timber Corporation (NYSE:DEL):
DELTIC TIMBER CORPORATION CONSOLIDATED FINANCIAL DATA
SUMMARY THIRD QUARTER 2017 2016
Net sales $ 61,656,000 53,541,000 Net income
2,502,000 1,487,000 Earnings per common share Basic .21 .12
Assuming dilution .20 .12 Average common shares outstanding
Basic 12,070,795 11,990,556 Assuming dilution 12,155,853 12,023,406
YEAR-TO-DATE 2017 2016 Net sales
$ 170,224,000 160,870,000 Net income 6,299,000 6,102,000
Earnings per common share Basic .52 .50 Assuming dilution
.52 .50 Average common shares outstanding Basic 12,067,663
12,005,116 Assuming dilution 12,165,024 12,064,582
Deltic Timber Corporation (NYSE:DEL), a natural resources
company, today announced financial results for the third quarter of
2017.
Third Quarter 2017
Highlights
- Net sales totaled $61.6 million,
compared to $53.5 million for third quarter 2016
- Net income was $2.5 million, or $.20
per diluted share, compared to net income of $1.5 million,
or $.12 per diluted share, for the same period of 2016
Financial results for the third quarter of 2017 benefited from
increased operating income in the Woodlands and Real Estate
segments combined with lower corporate general and administrative
expenses. The Manufacturing segment results were lower than third
quarter 2016 due to planned maintenance at the Del-Tin Fiber medium
density fiberboard ("MDF") plant to replace the press chains and a
press belt. In addition, $2 million of debt was repaid on our
revolving credit facility during the third quarter of 2017.
Woodlands Segment
Third Quarter 2017 Highlights
- Sold 196,635 tons of pine sawtimber, 4%
above Q3 2016
- Pine sawtimber prices averaged $28/ton,
unchanged from previous year quarter
- Sold 153,665 tons of pine pulpwood, 23%
above Q3 2016
- Pine pulpwood prices averaged $7/ton,
unchanged from previous year quarter
Woodlands Segment Financial Results
($ in millions)
Q3
2017 Q3 2016 Q2 2017
Segment net sales $ 11.3 9.0 10.2 Segment operating income $ 5.4
4.1 5.0
Woodlands segment operating income increased in third quarter of
2017 compared to third quarter 2016 principally due to higher
volumes of sawtimber and pulpwood sold, despite significant wet
weather in July and August. The increase in volume sold was mainly
due to timber deed sales.
Manufacturing Segment
Third Quarter 2017 Highlights
- Sold 80.5 million board feet of lumber,
16% above Q3 2016
- Lumber prices averaged $15/MBF lower
than Q3 2016
- Sold 23.9 million square feet of MDF,
8% below Q3 2016
- MDF prices decreased slightly compared
to Q3 2016
- Replaced press chains and press belt in
MDF plant, improving production efficiency
Manufacturing Segment Financial Results
($ in millions)
Q3 2017
Q3 2016 Q2 2017 Segment net sales $ 48.3 46.5
45.5 Segment operating income $ 3.7 5.7 4.0
Manufacturing segment operating income decreased in third
quarter 2017 compared to third quarter 2016, principally as a
result of higher operating expenses in lumber and MDF and lower
average sales prices for lumber, partially offset by higher lumber
sales volumes. The MDF plant’s operating results were adversely
impacted in the third quarter 2017 compared to previous year
quarter due to the planned downtime in August to replace press
chains and a press belt. Since the outage, the plant has been
running at over 90% uptime and producing in excess of 20% of higher
margin thin board.
Real Estate Segment
Third Quarter 2017 Highlights
- Sold 72 residential lots compared to 25
lots in Q3 2016
- Residential lot sales prices averaged
$63,000/lot, down 10% from Q3 2016, due to mix
Real Estate Segment Financial Results
($ in millions)
Q3 2017
Q3 2016 Q2 2017 Segment net sales $ 6.2 3.3
5.4 Segment operating income/(loss) $ 1.0 (.2 ) 1.8
Real Estate segment operating income was higher in the third
quarter of 2017 compared to third quarter 2016 due to increased
residential lot sales, partially offset by lower average pricing
per residential lot due to mix of lots sold. Lot sales reflect the
closings of our successful Wildwood smaller lot offerings. Due to
favorable demand, additional lot offerings are planned in fourth
quarter in Wildwood as well as in three neighborhoods in Chenal
Valley.
Corporate Segment General and
Administrative Expense, Interest Expense, and Income Tax
Expense
Corporate segment general and administrative expense was $4.1
million, compared to $5.4 million for the same period of 2016.
The decrease reflects lower salaries and incentive expense as well
as the benefit of cost reduction initiatives. Income tax expense in
the third quarter of 2017 was $1.6 million, compared to a $.9
million in the prior-year’s third quarter.
Capital Expenditures
Capital expenditures were $8 million in the third quarter 2017
compared to $14.8 million for the third quarter of 2016. There were
timberland acquisition expenditures of $.4 million in the third
quarter of 2017 compared to timberland acquisition expenditures of
$.5 million during the same period of 2016.
Outlook
Regarding the outlook for the fourth quarter and full year of
2017, Deltic currently anticipates the pine sawtimber harvest to be
275,000 to 300,000 tons and 885,000 to 910,000 tons, respectively,
depending on weather conditions. Finished lumber sales volume is
estimated to be 75 to 85 million board feet for the fourth quarter
of 2017 and 295 to 305 million board feet for full-year 2017. MDF
sales volume for the fourth quarter and year of 2017 is forecast to
be 20 to 30 million square feet and 95 to 105 million square feet,
respectively. Actual sales volumes for both finished lumber and MDF
are dependent upon market conditions. Residential lot sales are
projected at 70 to 80 lots for the fourth quarter and 150 to
160 lots for full-year of 2017. Commercial acreage within Chenal
Valley continues to receive increased interest, with negotiations
currently surrounding several tracts. However, due to the volatile
nature of commercial real estate transactions and significant
number of factors involved, it is difficult to anticipate future
closings.
Separately, Deltic announced earlier today that it has entered
into a merger agreement with Potlatch Corporation. For more
information regarding the agreement, please refer to the Form 8-K
filed August 23, 2017, with the Securities and Exchange
Commission.
Forward-Looking
Statements
Statements included herein that are not historical in nature are
intended to be, and are hereby identified as, “forward-looking
statements” within the meaning of the federal securities laws. Such
statements reflect the Company’s current expectations and involve
certain risks and uncertainties. Actual results could differ
materially from those included in such forward-looking statements.
Factors that could cause such differences include, but are not
limited to, the cyclical nature of the industry, changes in
interest rates, credit availability, general economic conditions,
adverse weather, cost and availability of materials used to
manufacture the Company’s products, natural gas pricing and volumes
produced, and the other risk factors described from time to time in
the reports and disclosure documents filed by the Company with the
Securities and Exchange Commission.
Conference Call
Deltic participated in a joint conference call with Potlatch
earlier today, therefore the Company will not hold the third
quarter 2017 earnings conference call originally planned for
Thursday, November 2, 2017, at 10:00 a.m. Central Time.
About Deltic
Deltic Timber Corporation is a natural resources company focused
on the efficient and environmentally responsible management of its
land holdings. The Company owns approximately 530,000 acres of
timberland, operates two sawmills and a medium density fiberboard
plant, and is engaged in real estate development. Headquartered in
El Dorado, Arkansas, the Company’s operations are located primarily
in Arkansas and north Louisiana.
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version on businesswire.com: http://www.businesswire.com/news/home/20171023006480/en/
Deltic Timber CorporationAnna Torma,
870-881-6463ir@deltic.com
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