Weyerhaeuser Earnings 2021-03-31

Balance Sheet	Income Statement	Cash Flow
Assets, Equity	Rev, G Profit, Net Income	Ops, Inv, Fin

wy-10q_20210331.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NUMBER: 1-4825

WEYERHAEUSER COMPANY

(Exact name of registrant as specified in its charter)

Washington		91-0470860
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

220 Occidental Avenue South Seattle, Washington		98104-7800
(Address of principal executive offices)		(Zip Code)

(206) 539-3000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Common Stock, par value $1.25 per share

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

As of April 26, 2021, 749,215 thousand shares of the registrant’s common stock ($1.25 par value) were outstanding.

TABLE OF CONTENTS

PART I	FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS:
	CONSOLIDATED STATEMENT OF OPERATIONS	1
	CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME	2
	CONSOLIDATED BALANCE SHEET	3
	CONSOLIDATED STATEMENT OF CASH FLOWS	4
	CONSOLIDATED STATEMENT OF CHANGES IN EQUITY	5
	INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	6
	NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	7
ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (MD&A)	14
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	25
ITEM 4.	CONTROLS AND PROCEDURES	25

PART II	OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	25
ITEM 1A.	RISK FACTORS	25
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	25
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES – NOT APPLICABLE
ITEM 4.	MINE SAFETY DISCLOSURES – NOT APPLICABLE
ITEM 5.	OTHER INFORMATION – NOT APPLICABLE
ITEM 6.	EXHIBITS	26
	SIGNATURES	27

PART I – FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

WEYERHAEUSER COMPANY

CONSOLIDATED STATEMENT OF OPERATIONS

(UNAUDITED)

	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES	MARCH 2021			MARCH 2020
Net sales (Note 3)	$	2,506		$	1,728
Costs of sales		1,430			1,382
Gross margin		1,076			346
Selling expenses		20			22
General and administrative expenses		90			74
Other operating costs, net (Note 15)		10			10
Operating income		956			240
Non-operating pension and other post-employment benefit costs (Note 7)		(8	)		(9	)
Interest income and other		1			1
Interest expense, net of capitalized interest		(79	)		(85	)
Earnings before income taxes		870			147
Income taxes (Note 16)		(189	)		3
Net earnings	$	681		$	150

Earnings per share, basic and diluted (Note 4)	$	0.91		$	0.20
Weighted average shares outstanding (in thousands) (Note 4):
Basic		748,718			746,534
Diluted		750,024			747,155

See accompanying Notes to Consolidated Financial Statements.

WEYERHAEUSER COMPANY

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(UNAUDITED)

	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS	MARCH 2021		MARCH 2020
Net earnings	$	681	$	150
Other comprehensive income (loss):
Foreign currency translation adjustments		9		(42	)
Changes in unamortized actuarial loss, net of tax expense of $7 and $16		20		44
Changes in unamortized net prior service credit, net of tax benefit of $1 and $0		1		1
Total other comprehensive income		30		3
Total comprehensive income	$	711	$	153

See accompanying Notes to Consolidated Financial Statements.

WEYERHAEUSER COMPANY

CONSOLIDATED BALANCE SHEET

(UNAUDITED)

DOLLAR AMOUNTS IN MILLIONS, EXCEPT PAR VALUE	MARCH 31, 2021			DECEMBER 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	1,016		$	495
Receivables, net		589			450
Receivables for taxes		7			82
Inventories (Note 5)		505			443
Prepaid expenses and other current assets		141			139
Total current assets		2,258			1,609
Property and equipment, less accumulated depreciation of $3,487 and $3,432		1,971			2,013
Construction in progress		91			73
Timber and timberlands at cost, less depletion		11,776			11,827
Minerals and mineral rights, less depletion		265			268
Deferred tax assets		106			120
Other assets		407			401
Total assets	$	16,874		$	16,311
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt (Note 9)	$	150		$	150
Accounts payable		236			204
Accrued liabilities (Note 8)		549			596
Total current liabilities		935			950
Long-term debt, net (Note 9)		5,325			5,325
Deferred tax liabilities		26			24
Deferred pension and other post-employment benefits (Note 7)		893			911
Other liabilities		367			370
Total liabilities		7,546			7,580
Commitments and contingencies (Note 11)
Equity:
Common shares: $1.25 par value; authorized 1,360 million shares; issued and outstanding: 748,751 thousand shares at March 31, 2021 and 747,385 thousand shares at December 31, 2020		936			934
Other capital		8,222			8,208
Retained earnings		962			411
Accumulated other comprehensive loss (Note 12)		(792	)		(822	)
Total equity		9,328			8,731
Total liabilities and equity	$	16,874		$	16,311

See accompanying Notes to Consolidated Financial Statements.

WEYERHAEUSER COMPANY

CONSOLIDATED STATEMENT OF CASH FLOWS

(UNAUDITED)

	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS	MARCH 2021			MARCH 2020
Cash flows from operations:
Net earnings	$	681		$	150
Noncash charges (credits) to earnings:
Depreciation, depletion and amortization		118			123
Basis of real estate sold		27			62
Deferred income taxes, net		8			(82	)
Pension and other post-employment benefits (Note 7)		19			19
Share-based compensation expense (Note 13)		7			7
Change in:
Receivables, net		(139	)		(82	)
Receivables and payables for taxes		120			79
Inventories		(60	)		(72	)
Prepaid expenses and other current assets		(2	)		(2	)
Accounts payable and accrued liabilities		(60	)		(91	)
Pension and post-employment benefit contributions and payments		(8	)		(10	)
Other		(13	)		(15	)
Net cash from operations		698			86
Cash flows from investing activities:
Capital expenditures for property and equipment		(31	)		(47	)
Capital expenditures for timberlands reforestation		(22	)		(21	)
Proceeds from note receivable held by variable interest entities (Note 6)		—			362
Proceeds from sale of Montana timberlands (Note 14)		—			145
Other		—			2
Net cash from investing activities		(53	)		441
Cash flows from financing activities:
Cash dividends on common shares		(127	)		(254	)
Net proceeds from issuance of long-term debt (Note 9)		—			732
Proceeds from borrowings on line of credit (Note 9)		—			550
Payments on line of credit (Note 9)		—			(230	)
Proceeds from exercise of stock options		17			6
Other		(14	)		(12	)
Net cash from financing activities		(124	)		792
Net change in cash and cash equivalents		521			1,319
Cash and cash equivalents at beginning of period		495			139
Cash and cash equivalents at end of period	$	1,016		$	1,458
Cash paid (received) during the period for:
Interest, net of amount capitalized of $1 and $1	$	75		$	108
Income taxes, net of refunds	$	66		$	—

See accompanying Notes to Consolidated Financial Statements.

WEYERHAEUSER COMPANY

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(UNAUDITED)

	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES	MARCH 2021			MARCH 2020
Common shares:
Balance at beginning of period	$	934		$	932
Issued for exercise of stock options and vested restricted stock units		2			1
Balance at end of period		936			933
Other capital:
Balance at beginning of period		8,208			8,152
Issued for exercise of stock options		16			6
Shared-based compensation		7			7
Other transactions, net		(9	)		(6	)
Balance at end of period		8,222			8,159
Retained earnings (accumulated deficit):
Balance at beginning of period		411			(3	)
Net earnings		681			150
Dividends on common shares		(130	)		(256	)
Balance at end of period		962			(109	)
Accumulated other comprehensive loss:
Balance at beginning of period		(822	)		(904	)
Other comprehensive income		30			3
Balance at end of period (Note 12)		(792	)		(901	)
Total equity:
Balance at end of period	$	9,328		$	8,082

Dividends paid per common share	$	0.17		$	0.34

See accompanying Notes to Consolidated Financial Statements.

INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1:	BASIS OF PRESENTATION	7

NOTE 2:	BUSINESS SEGMENTS	7

NOTE 3:	REVENUE RECOGNITION	8

NOTE 4:	NET EARNINGS PER SHARE	8

NOTE 5:	INVENTORIES	9

NOTE 6:	VARIABLE INTEREST ENTITIES	9

NOTE 7:	PENSION AND OTHER POST-EMPLOYMENT BENEFIT PLANS	10

NOTE 8:	ACCRUED LIABILITIES	10

NOTE 9:	LONG-TERM DEBT AND LINE OF CREDIT	10

NOTE 10:	FAIR VALUE OF FINANCIAL INSTRUMENTS	11

NOTE 11:	LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES	11

NOTE 12:	ACCUMULATED OTHER COMPREHENSIVE LOSS	12

NOTE 13:	SHARE-BASED COMPENSATION	12

NOTE 14:	TIMBERLAND ACQUISITIONS AND DIVESTITURES	13

NOTE 15:	OTHER OPERATING COSTS, NET	13

NOTE 16:	INCOME TAXES	13

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE QUARTERS ENDED MARCH 31, 2021 AND 2020

NOTE 1: BASIS OF PRESENTATION

Our consolidated financial statements provide an overall view of our results of operations, financial condition and cash flows. They include our accounts and the accounts of entities we control, including majority-owned domestic and foreign subsidiaries. They do not include our intercompany transactions and accounts, which are eliminated. Throughout these Notes to Consolidated Financial Statements, unless specified otherwise, references to “Weyerhaeuser,” “we,” “the company” and “our” refer to the consolidated company.

The accompanying unaudited Consolidated Financial Statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods presented. Except as otherwise disclosed in these Notes to Consolidated Financial Statements, such adjustments are of a normal, recurring nature. The Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission pertaining to interim financial statements. Certain information and footnote disclosures normally included in our annual Consolidated Financial Statements have been condensed or omitted. These quarterly Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2020. Results of operations for interim periods should not necessarily be regarded as indicative of the results that may be expected for the full year.

NOTE 2: BUSINESS SEGMENTS

We are principally engaged in growing and harvesting timber; manufacturing, distributing and selling products made from trees; maximizing the value of every acre we own through the sale of higher and better use (HBU) properties; and monetizing the value of surface and subsurface assets through leases and royalties. Our business segments are categorized based primarily on products and services which include:

●	Timberlands – Logs, timber, recreational leases and other products;

●	Real Estate, Energy and Natural Resources (Real Estate & ENR) – Real Estate (sales of timberlands) and ENR (rights to explore for and extract hard minerals, construction materials, natural gas, and wind and solar resources) and

●	Wood Products – Structural lumber, oriented strand board, engineered wood products and building materials distribution.

A reconciliation of our business segment information to the respective information in the Consolidated Statement of Operations is as follows:

	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS	MARCH 2021			MARCH 2020
Sales to unaffiliated customers:
Timberlands	$	379		$	381
Real Estate & ENR		106			112
Wood Products		2,021			1,235
		2,506			1,728
Intersegment sales:
Timberlands		134			122

Total sales		2,640			1,850
Intersegment eliminations		(134	)		(122	)
Total	$	2,506		$	1,728
Net contribution (charge) to earnings:
Timberlands	$	108		$	105
Real Estate & ENR		66			36
Wood Products		840			134
		1,014			275
Unallocated items⁽¹⁾		(65	)		(43	)
Net contribution to earnings		949			232
Interest expense, net of capitalized interest		(79	)		(85	)
Earnings before income taxes		870			147
Income taxes		(189	)		3
Net earnings	$	681		$	150

(1)

Unallocated items are gains or charges not related to, or allocated to, an individual operating segment. They include all or a portion of items such as share-based compensation, pension and post-employment costs, elimination of intersegment profit in inventory and LIFO, foreign exchange transaction gains and losses, interest income and other as well as legacy obligations.

NOTE 3: REVENUE RECOGNITION

A reconciliation of revenue recognized by our major products:

	QUARTER ENDED
DOLLAR AMOUNTS IN MILLIONS	MARCH 2021		MARCH 2020
Net sales to unaffiliated customers:
Timberlands segment
Delivered logs:
West
Domestic sales	$	79	$	87
Export grade sales		122		90
Subtotal West		201		177
South		131		150
North		16		17
Subtotal delivered logs sales		348		344
Stumpage and pay-as-cut timber		6		5
Recreational and other lease revenue		16		15
Other⁽¹⁾		9		17
Net sales attributable to Timberlands segment		379		381
Real Estate & ENR segment
Real estate		84		95
Energy and natural resources		22		17
Net sales attributable to Real Estate & ENR segment		106		112
Wood Products segment
Structural lumber		990		508
Oriented strand board		438		190
Engineered solid section		142		127
Engineered I-joists		83		78
Softwood plywood		56		39
Medium density fiberboard		48		44
Complementary building products		171

Price	27.79	EPS	-0
Shares	747	P/E	-134
MCap	20,746	P/FCF	31
Net Debt	7,553	EBIT	188
TEV	28,299	TEV/EBIT	151
TTM 2019-09-30, in MM, except price, ratios

10-Q	2021-03-31	Filed 2021-04-30
10-K	2020-12-31	Filed 2021-02-19
10-Q	2020-09-30	Filed 2020-10-30
10-Q	2020-06-30	Filed 2020-07-31
10-Q	2020-03-31	Filed 2020-05-01
10-K	2019-12-31	Filed 2020-02-14
10-Q	2019-09-30	Filed 2019-10-25
10-Q	2019-06-30	Filed 2019-07-26
10-Q	2019-03-31	Filed 2019-04-26
10-K	2018-12-31	Filed 2019-02-15
10-Q	2018-09-30	Filed 2018-10-26
10-Q	2018-06-30	Filed 2018-07-27
10-Q	2018-03-31	Filed 2018-04-27
10-K	2017-12-31	Filed 2018-02-16
10-Q	2017-09-30	Filed 2017-10-27
10-Q	2017-06-30	Filed 2017-07-28
10-Q	2017-03-31	Filed 2017-04-28
10-K	2016-12-31	Filed 2017-02-24
10-Q	2016-09-30	Filed 2016-10-28
10-Q	2016-06-30	Filed 2016-08-05
10-Q	2016-03-31	Filed 2016-05-06
10-K	2015-12-31	Filed 2016-02-17
10-Q	2015-09-30	Filed 2015-10-30
10-Q	2015-06-30	Filed 2015-07-31
10-Q	2015-03-31	Filed 2015-05-01
10-K	2014-12-31	Filed 2015-02-13
10-Q	2014-09-30	Filed 2014-10-31
10-Q	2014-06-30	Filed 2014-08-04
10-Q	2014-03-31	Filed 2014-04-30
10-K	2013-12-31	Filed 2014-02-18
10-Q	2013-09-30	Filed 2013-11-04
10-Q	2013-06-30	Filed 2013-08-01
10-Q	2013-03-31	Filed 2013-04-30
10-K	2012-12-31	Filed 2013-02-19
10-Q	2012-09-30	Filed 2012-11-02
10-Q	2012-06-30	Filed 2012-08-03
10-Q	2012-03-31	Filed 2012-05-04
10-Q	2011-09-30	Filed 2011-11-04
10-Q	2011-06-30	Filed 2011-08-05
10-Q	2011-03-31	Filed 2011-05-06
10-Q	2010-09-30	Filed 2010-11-05
10-Q	2010-06-30	Filed 2010-08-06
10-Q	2010-03-31	Filed 2010-05-07
10-K	2009-12-31	Filed 2010-02-26

8-K	2020-11-16
8-K	2020-11-12
8-K	2020-10-30
8-K	2020-10-26
8-K	2020-10-09
8-K	2020-09-11
8-K	2020-09-02
8-K	2020-08-31
8-K	2020-08-20
8-K	2020-08-14
8-K	2020-07-31
8-K	2020-07-22
8-K	2020-06-02
8-K	2020-05-15
8-K	2020-05-01
8-K	2020-04-17
8-K	2020-03-30
8-K	2020-03-26
8-K	2020-03-02
8-K	2020-02-18
8-K	2020-01-31
8-K	2020-01-29
8-K	2020-01-22
8-K	2019-12-16
8-K	2019-11-12
8-K	2019-10-25
8-K	2019-09-16
8-K	2019-07-26
8-K	2019-06-04
8-K	2019-05-17
8-K	2019-04-26
8-K	2019-03-04
8-K	2019-02-21
8-K	2019-02-01
8-K	2019-01-23
8-K	2018-10-26
8-K	2018-08-23
8-K	2018-08-13
8-K	2018-07-27
8-K	2018-05-18
8-K	2018-04-27
8-K	2018-03-01
8-K	2018-02-02

EX-31.1	wy-ex311_8.htm
EX-31.2	wy-ex312_10.htm
EX-32	wy-ex32_6.htm

WY 10Q Quarterly Report

Weyerhaeuser Earnings 2021-03-31