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Rayonier's (RYN) Q2 Earnings Surpass Estimates, Revenues Up
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Rayonier Inc. (RYN - Free Report) reported second-quarter 2018 net income per share of 28 cents, comfortably beating the Zacks Consensus Estimate of 20 cents. Further, the bottom line came in higher than the prior-year figure of 20 cents.
Total sales for the quarter came in at $245.9 million, up 22.3% year over year, handily outpacing the Zacks Consensus Estimate of $198.3 million.
Results reflect decent performance of the Southern Timber and Pacific Northwest segments, backed by rise in saw timber prices, as well as higher harvest volumes. Higher demand for rural Higher and Better Uses (“HBU”) properties aided the Real Estate segment’s revenues. However, the Trading segment put up a lackluster performance.
Segmental Performance
During the reported quarter, operating income in the company’s Southern Timber segment increased to $15.7 million from $9.7 million recorded in the year-ago quarter.
The Pacific Northwest Timber posted operating income of $5.6 million against operating loss of $1.5 million incurred in second-quarter 2017.
New Zealand Timber reported operating income of $17.8 million, down from the prior-year tally of $26.8 million.
Real Estate’s operating income was $18.9 million, higher than the year-ago figure of $16.1 million.
Trading segment’s operating income was $0.2 million, down from the year-earlier figure of $1.1 million.
Lastly, the Corporate and Other segment posted loss of $6.5 million compared with a loss of $5.3 million incurred in the comparable period last year. Increase in overhead allocation, interest expense, and compensation and benefits expense led to the elevated loss figure for this segment.
Liquidity
Rayonier ended the quarter with $106.6 million in cash and cash equivalents, down from $112.7 million recorded as of Dec 31, 2017. Total long-term debt was $972.3 million, significantly down from the figure of $1.02 billion as on Dec 31, 2017.
2018 Outlook
Rayonier expects 2018 earnings per share of 63-68 cents, while net income for the year is projected at $82-$89 million.
Conclusion
Rayonier has been actively repositioning its portfolio, through dispositions and strategic acquisitions. This favors the company’s U.S. South and Pacific Northwest portfolio, which is expected to perform well amid the ongoing U.S. housing recovery.
Nevertheless, the company faces competition from its substitutes and other market players in the timberland sector. Furthermore, lower quarterly harvest volumes and higher stumpage removals are expected to remain headwinds in the next six months of the year.
We are now looking forward to the earnings releases of MGM Growth Properties LLC , CoreCivic, Inc. and MedEquities Realty Trust, Inc. (MRT - Free Report) . MGM Growth Properties is set to release quarterly figures on Aug 7, while CoreCivic and MedEquities Realty Trust are slated to report their earnings on Aug 8.
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It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Rayonier's (RYN) Q2 Earnings Surpass Estimates, Revenues Up
Rayonier Inc. (RYN - Free Report) reported second-quarter 2018 net income per share of 28 cents, comfortably beating the Zacks Consensus Estimate of 20 cents. Further, the bottom line came in higher than the prior-year figure of 20 cents.
Total sales for the quarter came in at $245.9 million, up 22.3% year over year, handily outpacing the Zacks Consensus Estimate of $198.3 million.
Results reflect decent performance of the Southern Timber and Pacific Northwest segments, backed by rise in saw timber prices, as well as higher harvest volumes. Higher demand for rural Higher and Better Uses (“HBU”) properties aided the Real Estate segment’s revenues. However, the Trading segment put up a lackluster performance.
Segmental Performance
During the reported quarter, operating income in the company’s Southern Timber segment increased to $15.7 million from $9.7 million recorded in the year-ago quarter.
The Pacific Northwest Timber posted operating income of $5.6 million against operating loss of $1.5 million incurred in second-quarter 2017.
New Zealand Timber reported operating income of $17.8 million, down from the prior-year tally of $26.8 million.
Real Estate’s operating income was $18.9 million, higher than the year-ago figure of $16.1 million.
Trading segment’s operating income was $0.2 million, down from the year-earlier figure of $1.1 million.
Lastly, the Corporate and Other segment posted loss of $6.5 million compared with a loss of $5.3 million incurred in the comparable period last year. Increase in overhead allocation, interest expense, and compensation and benefits expense led to the elevated loss figure for this segment.
Liquidity
Rayonier ended the quarter with $106.6 million in cash and cash equivalents, down from $112.7 million recorded as of Dec 31, 2017. Total long-term debt was $972.3 million, significantly down from the figure of $1.02 billion as on Dec 31, 2017.
2018 Outlook
Rayonier expects 2018 earnings per share of 63-68 cents, while net income for the year is projected at $82-$89 million.
Conclusion
Rayonier has been actively repositioning its portfolio, through dispositions and strategic acquisitions. This favors the company’s U.S. South and Pacific Northwest portfolio, which is expected to perform well amid the ongoing U.S. housing recovery.
Nevertheless, the company faces competition from its substitutes and other market players in the timberland sector. Furthermore, lower quarterly harvest volumes and higher stumpage removals are expected to remain headwinds in the next six months of the year.
Rayonier Inc. Price, Consensus and EPS Surprise
Rayonier Inc. Price, Consensus and EPS Surprise | Rayonier Inc. Quote
Currently, Rayonier carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
We are now looking forward to the earnings releases of MGM Growth Properties LLC , CoreCivic, Inc. and MedEquities Realty Trust, Inc. (MRT - Free Report) . MGM Growth Properties is set to release quarterly figures on Aug 7, while CoreCivic and MedEquities Realty Trust are slated to report their earnings on Aug 8.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>