For the major publicly-traded timberland owners - a list that includes Rayonier (NYSE:RYN), Plum Creek (NYSE:PCL), Weyerhaeuser (NYSE:WY), Pope Resources (NASDAQ:POPE), and Potlatch (NASDAQ:PCH) - the frustrating wait for a housing-led recovery goes on. Although Rayonier does have a relative advantage to Plum Creek with its larger (as a percentage) weighting to the Pacific Northwest and its New Zealand joint venture, not to mention the absence of wood products operations, the company can do relatively little in the face of persistent weakness in stumpage prices and sluggish demand for HBU real estate.
***
Earlier this year, Rayonier completed the spin-off of Rayonier Advanced Materials (NYSE:RYAM), the company's former specialty cellulose, ethers, and pulp business. Now, Rayonier is effectively a timberland pure-play - owning about 2.1M acres of U.S. timberland, another 200K acres designated as HBU land (to be sold for its real estate value), and more than 300K acres in New Zealand owned through a 65% interest in a joint venture with Matariki that focuses on Radiata pine for Asian export markets.
Unlike Weyerhaeuser and Plum Creek, Rayonier does not have a wood products operation. I'd call that a mixed-to-positive factor for the company. These wood product operations (which manufacture products like lumber, plywood, and engineered structural products) can generate pretty good cash flow when residential building activity picks up, but they typically command lower multiples than timberlands on a "dollar for dollar" basis. *** Timberland operators are sort of stuck right now - because the equity markets assign a lower per-acre value to timberland acreage than actual real-time private transactions, acquiring more timberland now is a tricky move. Rayonier doesn't really need to acquire more land, particularly since it sold its lower-value Northeast lands in 2013, but adding more higher-value land in areas like the Pacific Northwest wouldn't be terrible. All told, though, Rayonier's best move is just to manage its harvests appropriately, take advantage of new opportunities to sell pulpwood (like for wood fuel pellets), and wait for prices to improve.
Prentiss & Carlisle's insight:
"Timberland operators are sort of stuck right now - because the equity markets assign a lower per-acre value to timberland acreage than actual real-time private transactions." Where have I heard that before? Oh, that's right, it was the reason Sir James Goldsmith targeted timber companies for hostile takeovers in the 1980's. It was the reason Wall Street pressured timber companies to divest of their timberlands in the late 1990's and early 2000's.
I happen to agree entirely with the observation that equity markets are assigning a lower value than private transactions would bring. Given the amount of institutional dry powder right now, might that suggest the time is ripe for a hostile run at the timber REIT's? The rationale has already played out twice in the last thirty years.
David Nunes, CEO of Poulsbo timberland management company Pope Resources, is quitting to become CEO of forest products company Rayonier Inc.
Pope Resources said current CFO Thomas Ringo, who has been at the company for 25 years, will serve as interim CEO.
"Dave has positioned us well to continue growing, and we have already begun a search for the right person to replace him," said Pope Resources lead director Douglas Norberg, in a statement.
Pope Resources (NASDAQ: POPE) owns or manages 204,000 acres of timberland and development property in Washington, Oregon, and California.
New Zealand forest growers, long overshadowed by booming returns from the dairy industry, look set to cash in on record prices for logs as they prepare to harvest trees planted in a flurry of activity two decades ago.
Forestry plantation activity in New Zealand jumped between 1992 and 1998, as a surge in Asian log prices lured investment syndicates to the sector. Radiata pine, which makes up about 90 percent of the nation's plantations, are typically felled between 26 and 32 years, meaning the "wall of wood" will start being harvested from about 2018, according to government figures. *** China is underpinning New Zealand commodity price strength as Asia's largest economy undergoes urbanisation, growing incomes and demand for better housing, says ASB rural economist Nathan Penny.
Forestry exports to China rose more than 50 percent in 2013, putting New Zealand ahead of Russia as the biggest seller of logs into that market. Russia's log exports have dipped as a result of an export tax aimed at stimulating its domestic timber processing industry. At the same time, shipments from the US and Canada have dwindled as demand picked up in their home markets. *** While an increase in supply in coming years may put some pressure on prices, foresters have the ability to stagger harvests and continued Chinese demand is likely to underpin the sector, Penny said. *** Increased demand in New Zealand from the rebuilding of earthquake damaged Christchurch and a surging Auckland housing market are also adding to wood demand and supporting prices, Penny said. New Zealand exports of logs and wood surged 22 percent last year to $3.86 billion. In comparison, meat exports rose just 2.2 percent to $5.28 billion and dairy exports increased 17 percent to $13.4 billion. The Wood Council of New Zealand, which represents forestry and wood processors, aims to triple export earnings to $12 billion by 2022.
*** The New Zealand Superannuation Fund partnered with Harvard Management Company, the endowment fund of Harvard University, and the Public Sector Pension Investment Board, Canada's largest pension investment managers, for the harvesting rights to the 178,000 hectare Kaingaroa Forest, New Zealand's largest plantation forest and one of the largest contiguous plantation forests in the Southern Hemisphere.
The NZ Super Fund valued its 41.25 percent stake in Kaingaroa at $1 billion as at June 30, saying it has delivered an 18.05 percent return since it was purchased in 2006.
Other large plantations are owned by US-based Hancock Natural Resource Group, the world's largest timberland investment manager which bought 260,000 hectares of forests from Carter Holt Harvey, and Matariki Forests, a consortium managed by US-based Rayonier which owns 130,000 hectares of forests, according to Forest Owners Association records.
Demand for logs from China is hurting the local sawmilling industry as forest owners send their logs overseas rather than sell them to local processors, according to the New Zealand Timber Industry Federation.
Some 40 sawmills have closed since 2003, according to the New Zealand Forest Owners Association. In October, the Tachikawa Forest Products sawmill in Rotorua was put in receivership with the loss of 120 jobs.
Rayonier (NYSE:RYN) today announced that its board of directors has elected Lynn Wilson to the position of Executive Vice President, Forest Resources.
"Since joining Rayonier, Lynn has led the successful integration of multiple acquisitions, assumed responsibility for our international forestry operations and driven our Forest Resources business to greater levels of operating efficiency," stated Paul Boynton, Chairman, President and CEO. "This new title appropriately reflects Lynn's recently broadened global leadership role and her sustained success in leading our forestry operations."
Wilson is a member of Rayonier's senior management team and is responsible for 2.6 million acres of timberland in nine states and New Zealand. She's also responsible for the administration of Rayonier's Land Information Services and leadership of the company's timberland acquisition team. Prior to joining Rayonier, she served as Vice President, Operations Support with Plum Creek -- a position she reached after holding a variety of responsibilities, including company Logging Superintendent, Senior Resource Manager and General Manager. Her forestry career spans more than two decades.
Wilson holds a bachelor's degree in forest management from the University of Maine. She also graduated cum laude from Thomas College in Waterville, Maine, with a master's of business administration.
Rayonier Inc. (RYN) Q3 2013 Earnings Conference Call October 24, 2013 2:00 PM ET
Mark Wilde - Deutsche Bank
Okay, and then just one other question Lynn. I know that you guys have been working on trying to develop more log export business out of the southern U.S. Can you just give us an update on kind of where that’s at and how you think that may develop over the next couple of years?
Lynn Wilson - Senior Vice President, U.S. Forest Resources So, one of the things that we continue to do is to test those markets. So right now we have seen that our log export opportunities on the Atlantic port and in the Gulf port have been modest. We’ve all been container so far, no break box or free hold as we have in our Pacific Northwest operations and so that shipping cost is the break point for us.
So right now our domestic markets are better timber margin, but we are continuing to test it, continuing to have a small volume and we are continuing to work with opportunities that would increase that net timber margin.
*** Paul Quinn - RBC Capital Okay. Thanks very much and then just lastly, just on the timberland side, what do you see in those timberland market? It seems like that market has heated up quite a bit and very challenging and competitive out there. Maybe you could just share some of the color that you are seeing in your market place close to your timberlands and whether you guys have experienced this same sort of issues.
Paul Boynton - President & Chief Executive Officer Yes. We think valuations are holding well and obviously continuing to improve and increase and we think that’s good. On the acquisition side, you know just year-to-date we probably looked at almost the same amount of property that we looked at a year ago, so there’s still pretty robust availability of timberland our there. I think if there was any change, there would have probably been two. I think we see plenty of dollars going after that availability.
So we definitely see that out there and we are seeing a little bit, at least this year, unless that fits our investment criteria. So for example I think this year-to-date, we probably evaluated 40 different properties. I mean we’ve offered on seven of those, which would have been lower that we where last year in terms of our percentage. And we’ve actually only acquired three small properties; about 12 million and that’s obviously separate from our New Zealand acquisition of 140.
So again, that would tell us that it’s at least not a sitting for our portfolio as maybe some others. It also tells us again it’s a pretty robust market in terms of timber and timberland values and that we also very disciplined.
The last three years we put out there and invested over $700 million and that includes the New Zealand acquisition and we can see the return on those investments and we feel very good about those returns and those investment. So we think our strategy is right on and this nature of that strategy is right on. It just takes a while and a lot of evaluation out there before you can bring them on in. *** Collin Mings - Raymond James Okay, alright, thanks Lynn. And then just some of your peers have recently discussed the potential to work with some institutional timberland owners, but are kind of unhappy with the TMO model. So I was just kind of curious as far as how you guys are thinking about potential JV partnerships as it related to timberland opportunities. I know you guys already touched a little bit on the acquisition environment, but just from that [angle] I’ll be curious of your thoughts.
Paul Boynton - President & Chief Executive Officer Well, I think we have a great JV in New Zealand right now, so we’re obviously working to really maximize that one and while here in the States we’re not really too actively searching for that opportunity.
Prentiss & Carlisle's insight:
Also mentioned was a 21,000 acre sale of timberland in Georgia that closed on the day of the call.
The demand for pulp wood has been strong in the first half of the year and growing ever since the economic downturn, according to Paul Boynton, chairman, president and CEO of Rayonier (NYSE RYN). In a video interview with REIT.com at REITWeek 2012: NAREIT’s Investor Forum in New York, Boynton discussed the demand for the timber REIT’s products. Rayonier has a market cap of $5.4 billion and owns and manages 2.7 million acres of property worldwide.
In reference to his company's results, Daniel Fulton, CEO of Weyerhauser (WY), said: "This year is a bit of an anomaly. We're seeing prices moving up in every single market for similar-type products.
All 4 timber REITS beat analyst consensus estimates for both 4Q12 and FY12.
The various factors which led to their success in 2012 are detailed in each of their earnings press releases, but I am more interested in what they can accomplish in 2013. We will begin by examining 4 catalysts, then discuss which companies are best positioned to take advantage.
The seventh-largest land owner in the United States is making huge money in the cellulose game.
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Organized as a real estate investment trust, it’s the seventh-largest landowner in the United States, the third largest in New Zealand. And the holdings keep growing. Last month, it bought another 62,600 acres in East Texas.
Most of its 2.7 million acres is timberland, growing trees that may end up in Southern sawmills or shipped to China.
***
Steven Chercover, a stock analyst who covers the forestry industry for D.A. Davidson, had nothing but good things to say about Rayonier.
“They’re a timber REIT [real estate investment trust] and at first blush, their business is selling trees for building materials,” he said. “With real estate recovering, cash flow should improve. But their specialty cellulose produces an unbelievable cash flow.
“That’s why it’s the best-performing timber REIT out there.”
The fibers are produced in Rayonier plants in Jesup, Ga., and Fernandina Beach. Jesup is the largest site in the company, with almost 900 employees; Fernandina Beach has 302.
With 35 percent of the world’s performance-fiber production, Rayonier is the No. 1 supplier. So it’s spending $300 million to rework its Jesup plant. The line that has turned trees into absorbent fluff for disposal diapers and other products is being converted to another performance-fiber line. That should be finished this year.
The numbers are simple: A ton of performance fiber brings close to $2,000, Boynton said. Fluff brings half that. And the company has sold all of its performance fibers for the past five years, he said.
“In the pulp and paper world, new capacity is usually a four-letter word,” Chercover said. “But they’ve got the customers for the fiber.”
At the 2012 Invest for Kids conference, Alex Klabin of Senator Investment Group pitched an idea he calls ‘Pulp Friction’. Klabin’s pick, Rayonier Inc. (NYSE:RYN), is a timber REIT with performance fiber operations. Klabin says about Rayonier, "it has sex appeal...with the fiber segment having high margins and high barriers to entry and the REIT segment being like an annuity and inflation hedge."
***
For 3Q, the Rayonier posted EPS of $0.62, compared to $0.71 for the same quarter last year. Sales are expected to be up 5-7% in 2012, and up another 10% in 2013. Driving this increase will be elevated prices for cellulose products that are used in cigarette filters and a recovering housing market, as well as increased demand from China for lumber. Rayonier pays a solid timber REIT dividend that yields 3.6%, compared to the average dividend of the other three REITs' average yield of 3.3%.
***
Klabin's real catalyst for generating serious returns for Rayonier investors is the possible spin off of Rayonier's fiber business. The fiber business is generally a high margin-high barrier to entry industry and Klabin expects Rayonier’s fiber segment to grow EBITDA by 50% over the next couple years, from $400 million to $650 million. Driving a potential spinoff of its fiber business will be a ramp up in earnings in fiber segment. Consequently, Rayonier may blow its REIT test in a couple years, which is a test that REITs are required to pass to retain REIT status, and in its basic form states that only a certain portion of a REITs earnings can be derived from non-REIT operations.
Timber REIT Weyerhaeuser's (NYS: WY) stock is booming, hitting a 52-week high despite slow growth from a rebounding housing market. While long-term shareholders of this century-old company have reaped bountiful profits from the trend, will Weyerhaeuser keep giving investors more of what they want -- or is it headed for a downturn?
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Overall, investors may want to take a cautious approach to investing in Weyerhaeuser. The company should perform well with a rebounding housing market and growing demand for wood products, but cautious investors could probably find stronger offerings. Timber rival Rayonier sports exceptional financial stats and a dividend that considerably beats Weyerhaeuser's, appealing to value and income investors alike.
The demand for pulp wood has been strong in the first half of the year and growing ever since the economic downturn, according to Paul Boynton, chairman, president and CEO of Rayonier (NYSE: RYN).
...
When the economic downturn became evident Boynton said the company recognized that the value for lumber was going to diminish. As a result the company decided to preserve its timber product and put more emphasis onto the pulp wood business.
Rayonier, a leading forest products company with a focus on forest resources, highly-purified cellulose fiber materials, and timberland, is implementing a strategic program to move IT applications and MDM to the cloud. This includes enabling a more flexible, app-centric mobile paradigm for its employees.
As part of this process, Rayonier is migrating away from its BlackBerry Enterprise Server to a combination of supported mobile devices and a cloud-based MDM solution. Before selecting an MDM solution, Rayonier evaluated three MDM solutions ultimately selecting Zencloud(TM) from Zenprise.
With positive signs that the housing market is starting to recover and the possibility of higher inflation in the coming years, income investors should take a look at REITs specializing in timber.
With strong US and Asian demand pushing up prices, stocks such as Weyerhaeuser (WY), Rayonier (RYN), and Plum Creek Timber (PCL) will be big winners. An alternative to purchasing individual stocks in this sector is buying shares of the Guggenheim Timber ETF (CUT). Here is a discussion of each timber stock.
Rayonier and Wayne County have reached a settlement in their dispute over the valuation of the company’s timberland. No one is saying, though, what the settlement is.
In a joint press release released late Thursday afternoon, Rayonier and the county government announced “agreement on a settlement to their ongoing dispute regarding valuations of Rayonier-owned Wayne County timberland.” As the release noted, the dispute dated back to 2008 and involved various court proceedings. *** When Russell Schweiss, Rayonier’s director of corporate communications, was asked about the terms of the settlement, though, he responded, “Rayonier and Wayne County have resolved the long-running tax dispute on mutually agreeable terms. Rayonier is pleased with the resolution. I am not, however, at liberty to discuss the specifics of the settlement.” *** Rayonier had contended that its timberland values from the 2008 countywide revaluation were too high. In the resulting dispute, a superior court judge found that the county’s process for valuing large-acre tracts was fundamentally flawed, and the Assessors’ Office eventually had nearly 50 Rayonier tracts reassessed.
Good morning, first up, again congrats on your new position, Ed and if you're listening, Hans, our best wishes to you. Just quickly Lynn, just you talked a lot about timberland acquisitions. Thank you for that overview but can you talk a little bit more about just who you're seeing more of the deal flow coming from, can you put a little bit more parameters around what you have under contract and just a little bit more detail on that acquisition front.
Certainly, Collin. Good morning. One of the things that we are seeing is a series of packages coming out from the TMOs, so those are throughout each of the region so those are multiple packages from multiple TMOs that's one side on the bid process and then the other aspect that we are seeing from internally from our team is the significant outreach and a ramp up of our effort. We are really focused on small private land owners that are adjacent or within our target markets and so some of the properties that we closed on are in that 5,000 acre to 10,000 acre range in both Florida and Georgia with one small property in Washington state that are within our current footprint where we were aware of a private land owner that had a quality property for sale. So once that we closed on so far has been in Baker County, Florida and a small property in Washington state and then a small property in Georgia, the other ones that we have under contract and are working towards closing are in East Texas and those from small private land owners.
Okay. Great, Lynn. Thanks for that level of detail. Just, making about transaction pricing and recognizing all the caveat of like no two pieces of timberland are the same but what do think as far what you're seeing as far as in the pricing environment when you would you say that kind of a comparable piece of timberland has gone up in value, call it in the US south, this year relative to last year or is there any way that you guys would think about that?
Its gone up slightly, Collin. They are over year and I think that's consistent what we are seeing in the wood market with the saw log pricing coming up as well in people’s viewpoint but its only slight up.
Rayonier Inc. said it plans to separate its performance fibers business from its forest resources and real estate operations to form two publicly traded companies this year.
The Jacksonville, Fla., company disclosed the plans to spin off the performance fibers business to shareholders, along with better-than-expected fourth-quarter earnings, sending its shares higher in midday trading Monday.
***
"Everything lined up at the perfect time to launch these two businesses," Chief Executive Paul Boynton said in an interview with The Wall Street Journal on Monday.
Mr. Boynton will serve as CEO of the performance fibers business. The still-unnamed company recorded revenue of more than $1 billion last year and has about 675,000 metric tons of cellulose specialties capacity between its Florida and Georgia facilities.
***
The forest resources and real-estate operations, meanwhile, will retain the Rayonier name and has 2.6 million acres of timberlands.
Mr. Boynton said he expects a boost in housing starts to drive growth at that company.
"We're expecting [housing starts] to move back to 1.5 million starts per year," Mr. Boynton said. "We think that will be a significant driver. We're on the rebound economically in the U.S."
***
The forest resources business posted $382 million in sales last year, while its real estate arm booked $149 million in sales. The company is searching for a chief executive to lead that operation, and current board member Richard Kincaid will serve as chairman.
Rayonier Inc. (NYSE:RYN) announced today that on November 6, China's Ministry of Commerce (MOFCOM) issued the following preliminary determination regarding the import of Rayonier dissolving pulp products into China:
1) Rayonier's high purity cellulose acetate and other high purity products will not be subject to any duties as they are specifically exempted.
2) Rayonier's lower purity Fibernier grade product used in commodity viscose applications will be subject to a 21.7 percent interim duty effective November 7.
Paul Boynton, Chairman, President and CEO stated, "While we are pleased that MOFCOM recognized the unique characteristics of our high-purity cellulose specialty products, we intend to challenge the interim duty on commodity viscose as it appears to be based on inaccurate assumptions."
In February 2013, MOFCOM initiated an anti-dumping investigation of imports of dissolving wood, cotton and bamboo pulp into China from the U.S., Canada and Brazil during 2012. These determinations by MOFCOM are preliminary and subject to change upon the completion of its investigation and issuance of its final determination, which is expected in the first half of 2014.
Rayonier is currently reviewing the basis for MOFCOM's duty calculation and expects to submit a formal response next week. In addition, the Company is evaluating all potential product and market segment options that its broad range of capabilities provides in the event that MOFCOM's preliminary duty is not materially reduced or eliminated. Rayonier does not expect that MOFCOM's preliminary duty will materially affect its business results.
Forest products REIT Rayonierannounced today its third-quarter dividend of $0.49 per share, an 11% increase over the $0.44-per-share payout it made to investors last quarter.
The board of directors said the quarterly dividend is payable on Sept. 30 to the holders of record at the close of business on Sept. 16.
Noting Rayonier's operations continue to provide steady and growing returns for its shareholders, Chairman, President, and CEO Paul G. Boynton said, "This significant dividend increase reflects the successful start-up of our cellulose specialties expansion project, strengthening timber and real estate markets and our confidence regarding future cash flows."
The regular dividend payment equates to a $1.96-per-share annual dividend, yielding 3.4% based on the closing price of Rayonier's stock on July 19.
Rayonier (RYN) is one of the few timber REITs in the industry, and has one of the lowest payout ratios in the industry, which could easily be lifted and in turn drive its dividend yield to over 5%; what's more is thestock is undervalued by as much as 35%.
We believe there are significant value prospects buried in Rayonier. The timber company completed its recent conversion to REIT status and should see upside in the near future thanks to a rebound in housing. The unique timber and pulp combo also provides exposure to various industries, and we see the downside limited given the company's vast asset base.
We believe the opportunity is unique given the current investing environment, one with both income and growth prospects. This is especially intriguing given the current market, where other dividend stocks might be trading richly as investors flock to yield.
On Tuesday, real estate and timberland management company Rayonier (NYSE: RYN) announced it is selling one of its four operating divisions, its wood products division, to Vancouver, Canada-based International Forest Products Limited (Interfor). Hereafter, says Rayonier, its manufacturing operations will focus more intensively on specialty chemicals.
The wood products division consists of three lumber mills in Georgia with a combined annual capacity of 360 million board feet of southern pine dimension lumber. They generate about $10 million in annual operating income. The sale, priced at $80 million, is expected to net Florida-based Rayonier a $40 million profit after taxes. As part of the deal, which is structured as an assets sale, Interfor has agreed to hire all 260 employees of the wood products division.
Rayonier (NYSE:RYN) today announced it has acquired approximately 62,600 acres of timberlands in East Texas. The property, purchased from a private ownership group for $88 million, or $1,406 per acre, brings the company’s total ownership in Texas to over 150,000 acres.
“These timberlands, located in one of the most competitive wood baskets in the Gulf States, significantly increase Rayonier’s landholdings in Texas and enable us to better support our existing paper, pulp and solid wood customers,” said Paul G. Boynton, chairman, president and chief executive officer. “With the majority of this property located within 60 miles of the Houston metropolitan area, it also provides tremendous value creation potential for our higher-and-better-use land sales program.”
The timberlands are located principally in Liberty, Polk and Trinity counties. Rayonier owns, leases or manages approximately 2.7 million acres in 10 states in the U.S. and New Zealand.
The timber industry is headed into some promising times. It is simultaneously experiencing the cessation of negative events and the start of positive ones.
Negative Events
· The housing crisis is ending and domestic home production is once again on the rise.
· Excess supply and the resultant price declines from forced harvesting due to the Canadian pine beetle epidemic are nearly concluded.
Positive Events
· The sustaining Chinese economy combined with its paucity of forests creates excellent export potential.
· High oil prices increase the viability of biomass for heating and electricity.
· Increasing options for revenue as entitlements and conservation efforts become more prevalent.
While the industry is looking strong, we must look closer at the individual companies to ascertain which is in position to benefit the most in the upswing of the cycle.
When asked to explain the difference between a fundamental and technical analyst I could serve up something from Investopedia.com or I could simply say a fundamental analyst will listen to compelling stories and a technical analyst will listen to the markets.
One listening tool is the new 52-week high/low list which often reveals the current dominant theme that is driving the markets. A dominant theme is an investment strategy that seems to work in confusing times.
...
The obvious dominant theme is the bullish stampede into the yield space but I can’t imagine investors spending the next ten years buying REITS, telecoms, utilities and pipelines unless they believe interest rates will never go up in our generation.
This less obvious dominant theme seems to be wood with stocks like Rayonier Inc. (RYN), Weyerhaeuser Co, (WY), Norbord Inc. (NBD). Acadian Timber Corp. (ADN) and West Fraser Timber Co. Ltd. (WFT) close to, or just posting new 52-week highs.
As I mentioned in my first article, Understanding Investments in Timber REITs, each of the four Timber REITS, Plum Creek (PCL), Potlatch (PCH), Weyerhaeuser (WY), and Rayonier (RYN), are quite different from each other. Today I thought we'd look at Rayonier. Because I am a dividend growth investor, I'll be focused on the safety of Rayonier's dividend which is $.40 per quarter, or about 3.7%.
"We are pleased with our first quarter results which were better than expected and create a solid base for full year performance," said Paul G. Boynton, President and CEO. "In Forest Resources, we increased harvest volumes to take advantage of stronger pulpwood markets in the Atlantic region and successfully integrated the 320,000 acres of timberlands acquired last year..."
...
In the Atlantic region, results improved due to stronger pulpwood demand, while in the Gulf States region earnings increased due to higher volumes from the 2011 timberland acquisitions. In the Northwest U.S. and New Zealand, results declined reflecting lower log shipments to China, as expected. The Northern region results also reflect higher fuel and logging costs.
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"Timberland operators are sort of stuck right now - because the equity markets assign a lower per-acre value to timberland acreage than actual real-time private transactions." Where have I heard that before? Oh, that's right, it was the reason Sir James Goldsmith targeted timber companies for hostile takeovers in the 1980's. It was the reason Wall Street pressured timber companies to divest of their timberlands in the late 1990's and early 2000's.
I happen to agree entirely with the observation that equity markets are assigning a lower value than private transactions would bring. Given the amount of institutional dry powder right now, might that suggest the time is ripe for a hostile run at the timber REIT's? The rationale has already played out twice in the last thirty years.