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Rayonier's (RYN) Q1 Earnings Miss Estimates, Decline Y/Y

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Rayonier Inc.’s (RYN - Free Report) reported first-quarter 2016 pro forma net income per share of 5 cents, missing the Zacks Consensus Estimate of 9 cents. Also, the bottom line came in lower than the prior-year quarter’s figure of 11 cents.

Total sales for the quarter came in at $186.5 million, up 38.4% year over year. Also, it surpassed the Zacks Consensus Estimate of $152 million.

Segmental Performance

During the quarter, pro forma operating income at the company’s Southern Timber segment declined to $13.9 million from $15.8 million recorded a year ago.

The Pacific Northwest Timber posted pro forma operating loss of $0.9 million. Pro forma operating income in first-quarter 2016 was of $1.4 million.

New Zealand Timber posted pro forma operating income of $10.3 million, up from the prior-year quarter figure of $4.7 million.

Real Estate posted pro forma operating income of $1.5 million, reflecting a decline from the year-ago figure of $4.2 million.

Trading segment posted pro forma operating income of $1.1 million, up from the year-ago figure of $0.4 million.

Lastly, pro forma operating loss at the Corporate and Other segment narrowed to $4.1 million from a loss of $4.3 million incurred in first-quarter 2016.

Liquidity

Rayonier ended the quarter with $219.4 million in cash and cash equivalents, up from $85.9 million recorded at the end of fourth-quarter 2016. Total long-term debt was $1.03 billion, reflecting a slight decrease from the Dec 31, 2016 figure.

Our Viewpoint

Continuous divestiture of non-strategic timberlands as well as re-investment in strategic timberlands, and strong pulpwood demand from key markets bode well for Rayonier in the long run.

However, tough compliance requirements, cut-throat competition with national and local players and foreign exchange fluctuations keep us concerned about this Zacks Rank #2 (Buy) stock.

Rayonier Inc. Price, Consensus and EPS Surprise

Rayonier Inc. Price, Consensus and EPS Surprise | Rayonier Inc. Quote

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