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Weyerhaeuser's (WY) Q1 Earnings & Revenues Top Estimates
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Weyerhaeuser Company (WY - Free Report) reported first-quarter 2022 results, wherein earnings and revenues handily beat the respective Zacks Consensus Estimate despite persistent supply-chain challenges.
Pertaining to the quarterly performance, Devin W. Stockfish, president and chief executive officer of Weyerhaeuser, stated, "Our teams delivered the company's strongest first quarter Adjusted EBITDA on record notwithstanding ongoing operational and supply chain challenges. In addition, we increased our base dividend by 5.9% and refinanced $900 million of debt in the quarter. We've also made meaningful progress towards our multi-year growth targets with the signing of our first carbon capture and storage agreement. Looking forward, we remain constructive on the demand fundamentals that will drive growth for our businesses and are well positioned to deliver superior long-term value and returns for our shareholders."
Weyerhaeuser Company Price, Consensus and EPS Surprise
For the first quarter, the company reported adjusted earnings of $1.31 per share, beating the consensus mark of $1.14 by 14.9%. The bottom line also increased from the year-ago adjusted figure of 91 cents per share.
Net sales for the quarter came in at $3,112 million, surpassing the consensus mark of $2,912 million by 6.9%. The figure also increased 24.2% from $2,506 million reported in the prior-year quarter.
Adjusted EBITDA came in at $1,497 million, up from $1,101 million in the year-ago period.
Segment Details
Timberlands: Net sales (including inter-segment sales of $161 million) from the segment came in at $626 million, up 22% from the year-ago figure of $513 million.
In the West, fee-harvest volumes increased significantly, while per unit log and haul costs decreased sequentially. Export-sales and domestic sales realizations also grew sequentially. In the South, sales realizations for sawlogs and fiber logs improved, while fee-harvest volumes declined seasonally. Per unit log and haul costs grew slightly on a sequential basis, given higher transportation costs.
Adjusted EBITDA came in at $247 million, up from $172 million in the year-ago quarter.
Real Estate, Energy and Natural Resources: For the fourth quarter, the segment’s net sales amounted to $128 million, up from $106 million a year ago. Also, adjusted EBITDA came in at $116 million, reflecting a decent increase from $96 million a year ago. Sequentially, earnings and adjusted EBITDA were up year over year due to greater real estate sales. The number of real estate acres sold increased from a year ago due to the timing of real estate transactions.
Wood Products: For the third quarter, segment sales totaled $2,519 million, up 24.6% from $2,021 million in the prior-year period. Adjusted EBITDA came in at $1,233 million, up from $889 million a year ago.
For the first quarter, sales realizations for lumber grew 76% on a sequential basis. The same for oriented strand board or OSB jumped 61% from the fourth quarter. Production volumes for lumber were moderately higher than the prior-year quarter due to less weather-related downtime and planned maintenance. Yet, sales volumes were lower year over year due to ongoing transportation hindrances.
Production volumes for OSB were higher, given less planned maintenance. Sales realizations for engineered wood products or EWP were higher sequentially.
Financial Highlights
As of Mar 31, 2022, Weyerhaeuser had cash and cash equivalents of $1.21 billion, down from $1.88 billion at 2021-end. Long-term debt was $5.053 billion million at quarter-end, down from $5.099 billion at 2021-end.
Net cash from operations was $957 million for first-quarter 2022 compared with $698 million in the year-ago period.
Outlook
For second-quarter 2022, the company expects earnings (before special items) and adjusted EBITDA in the Timberland segment to be much lower than first-quarter 2022. Nonetheless, the metrics will be higher than any other quarter since fourth-quarter 2018. In the West, it expects comparable fee-harvest volumes and lower sales realizations. WY anticipates per unit log and haul costs to be higher sequentially. In the South, the company expects sales realizations to be in line with first-quarter 2022. It anticipates seasonally higher forestry and road costs in the region. Meanwhile, WY expects higher fee-harvest volumes, and per unit log and haul costs.
In the Real Estate, Energy and Natural Resources segment, Weyerhaeuser anticipates earnings to be in line on a year-over-year basis. Adjusted EBITDA is expected to be marginally higher than the year-ago period.
Within the Wood Products segment, the company predicts earnings and adjusted EBITDA to be higher than first-quarter 2022.
Zacks Rank
Weyerhaeuser currently carries a Zacks Rank #2 (Buy).
United Rentals, Inc. (URI - Free Report) reported better-than-expected first-quarter 2022 results. Better fleet productivity on broad-based rental demand in construction and industrial verticals, higher total and rental revenues along with stronger pricing helped the company start 2022 on a stronger note.
URI also lifted its full-year guidance for total revenues, adjusted EBITDA and free cash flow, given customer sentiments and solid project activity.
NVR, Inc. (NVR - Free Report) reported first-quarter 2022 results, with earnings and revenues beating the respective Zacks Consensus Estimate and increasing year over year.
NVR’s first-quarter results benefited from a higher average price of settlements and lower lumber prices.
PulteGroup Inc. (PHM - Free Report) reported solid results for first-quarter 2022. Both earnings and revenues topped the Zacks Consensus Estimate as well as improved year over year.
PHM benefited from gains in revenues, improved gross margin and overhead leverage.
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Weyerhaeuser's (WY) Q1 Earnings & Revenues Top Estimates
Weyerhaeuser Company (WY - Free Report) reported first-quarter 2022 results, wherein earnings and revenues handily beat the respective Zacks Consensus Estimate despite persistent supply-chain challenges.
Pertaining to the quarterly performance, Devin W. Stockfish, president and chief executive officer of Weyerhaeuser, stated, "Our teams delivered the company's strongest first quarter Adjusted EBITDA on record notwithstanding ongoing operational and supply chain challenges. In addition, we increased our base dividend by 5.9% and refinanced $900 million of debt in the quarter. We've also made meaningful progress towards our multi-year growth targets with the signing of our first carbon capture and storage agreement. Looking forward, we remain constructive on the demand fundamentals that will drive growth for our businesses and are well positioned to deliver superior long-term value and returns for our shareholders."
Weyerhaeuser Company Price, Consensus and EPS Surprise
Weyerhaeuser Company price-consensus-eps-surprise-chart | Weyerhaeuser Company Quote
Inside the Headlines
For the first quarter, the company reported adjusted earnings of $1.31 per share, beating the consensus mark of $1.14 by 14.9%. The bottom line also increased from the year-ago adjusted figure of 91 cents per share.
Net sales for the quarter came in at $3,112 million, surpassing the consensus mark of $2,912 million by 6.9%. The figure also increased 24.2% from $2,506 million reported in the prior-year quarter.
Adjusted EBITDA came in at $1,497 million, up from $1,101 million in the year-ago period.
Segment Details
Timberlands: Net sales (including inter-segment sales of $161 million) from the segment came in at $626 million, up 22% from the year-ago figure of $513 million.
In the West, fee-harvest volumes increased significantly, while per unit log and haul costs decreased sequentially. Export-sales and domestic sales realizations also grew sequentially. In the South, sales realizations for sawlogs and fiber logs improved, while fee-harvest volumes declined seasonally. Per unit log and haul costs grew slightly on a sequential basis, given higher transportation costs.
Adjusted EBITDA came in at $247 million, up from $172 million in the year-ago quarter.
Real Estate, Energy and Natural Resources: For the fourth quarter, the segment’s net sales amounted to $128 million, up from $106 million a year ago. Also, adjusted EBITDA came in at $116 million, reflecting a decent increase from $96 million a year ago. Sequentially, earnings and adjusted EBITDA were up year over year due to greater real estate sales. The number of real estate acres sold increased from a year ago due to the timing of real estate transactions.
Wood Products: For the third quarter, segment sales totaled $2,519 million, up 24.6% from $2,021 million in the prior-year period. Adjusted EBITDA came in at $1,233 million, up from $889 million a year ago.
For the first quarter, sales realizations for lumber grew 76% on a sequential basis. The same for oriented strand board or OSB jumped 61% from the fourth quarter. Production volumes for lumber were moderately higher than the prior-year quarter due to less weather-related downtime and planned maintenance. Yet, sales volumes were lower year over year due to ongoing transportation hindrances.
Production volumes for OSB were higher, given less planned maintenance. Sales realizations for engineered wood products or EWP were higher sequentially.
Financial Highlights
As of Mar 31, 2022, Weyerhaeuser had cash and cash equivalents of $1.21 billion, down from $1.88 billion at 2021-end. Long-term debt was $5.053 billion million at quarter-end, down from $5.099 billion at 2021-end.
Net cash from operations was $957 million for first-quarter 2022 compared with $698 million in the year-ago period.
Outlook
For second-quarter 2022, the company expects earnings (before special items) and adjusted EBITDA in the Timberland segment to be much lower than first-quarter 2022. Nonetheless, the metrics will be higher than any other quarter since fourth-quarter 2018. In the West, it expects comparable fee-harvest volumes and lower sales realizations. WY anticipates per unit log and haul costs to be higher sequentially. In the South, the company expects sales realizations to be in line with first-quarter 2022. It anticipates seasonally higher forestry and road costs in the region. Meanwhile, WY expects higher fee-harvest volumes, and per unit log and haul costs.
In the Real Estate, Energy and Natural Resources segment, Weyerhaeuser anticipates earnings to be in line on a year-over-year basis. Adjusted EBITDA is expected to be marginally higher than the year-ago period.
Within the Wood Products segment, the company predicts earnings and adjusted EBITDA to be higher than first-quarter 2022.
Zacks Rank
Weyerhaeuser currently carries a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A Few Recent Construction Releases
United Rentals, Inc. (URI - Free Report) reported better-than-expected first-quarter 2022 results. Better fleet productivity on broad-based rental demand in construction and industrial verticals, higher total and rental revenues along with stronger pricing helped the company start 2022 on a stronger note.
URI also lifted its full-year guidance for total revenues, adjusted EBITDA and free cash flow, given customer sentiments and solid project activity.
NVR, Inc. (NVR - Free Report) reported first-quarter 2022 results, with earnings and revenues beating the respective Zacks Consensus Estimate and increasing year over year.
NVR’s first-quarter results benefited from a higher average price of settlements and lower lumber prices.
PulteGroup Inc. (PHM - Free Report) reported solid results for first-quarter 2022. Both earnings and revenues topped the Zacks Consensus Estimate as well as improved year over year.
PHM benefited from gains in revenues, improved gross margin and overhead leverage.