CatchMark Reports Fourth Quarter and Full-Year 2021 Results, Declares Dividend, and Provides 2022 Guidance
02/10/2022 - 04:05 PM
ATLANTA , Feb. 10, 2022 /PRNewswire/ -- CatchMark Timber Trust, Inc. (NYSE: CTT) today reported fourth quarter and full-year 2021 results. The company also declared a cash dividend of $0.07 5February 28, 2022 , payable on March 15, 2022 .
Brian M. Davis , CatchMark's Chief Executive Officer, said: "CatchMark exceeded our 2021 guidance for net income and met our 2021 guidance for Adjusted EBITDA, continuing our long track record of achieving timber sales prices substantially above market averages, while maintaining the highest productivity per acre among our peers. These results again attest to the prime quality of our timberlands in leading mill markets and our success in managing our delivered wood sales model supplemented by opportunistic stumpage sales. Following the completion of recent strategic large dispositions and the Triple T exit, we are now focused on growth opportunities in the U.S. South, the top U.S. mill region and one of the most important global wood baskets. Going forward, we see powerful macro forces — regional home construction, mill expansions, and the ongoing decline of Canadian market competition due to pine beetle infestation and British Columbia harvest deferrals — helping drive sustainable product price appreciation in our markets. At the same time, robust demand should continue to help us meet our timberland sales targets, and our solid capital position provides support for a disciplined growth strategy, including acquisitions and various environmental initiatives."
FOURTH QUARTER 2021 RESULTS
The following table summarizes the fourth quarter and comparable prior year period results:
FINANCIAL HIGHLIGHTS
(in millions except for tons and acres)
Three Months Ended December 31,
Change
2021
2020
Dollars, Tons or Acres
%
Results of Operations
Revenues
$ 20.5
$ 30.9
$ (10.4)
(34)%
Net Income (Loss)
$ 33.9
$ (3.0)
$ 36.9
1,246%
Adjusted EBITDA
$ 9.0
$ 17.3
$ (8.3)
(48)%
Harvest Volume (tons)
499,610
578,033
(78,423)
(14)%
Acres Sold
400
4,000
(3,600)
(91)%
Fourth quarter 2021 net income and earnings per share of $33.9 million $0.70
Business Segments Overview
For fourth quarter 2021, lower year-over-year total revenues and Adjusted EBITDA resulted from:
lower harvest volumes post recent large dispositions, most notably the highly profitable Bandon sale; selling fewer timberland acres due to the timing of most sales earlier in the year; and lower asset management fees due to the Triple T exit. The revenue impact of planned lower harvest volumes was lessened by significant increases in timber sales pricing as the company extended its long-sustained pricing premiums over U.S. South-wide averages.
Harvest Operations
Three Months Ended December 31,
Change
(in millions except for prices)
2021
2020
$
%
Timber Sales Revenue
$ 16.4
$ 19.9
$ (3.5)
(18)%
Harvest EBITDA
$ 8.8
$ 9.7
$ (0.9)
(9)%
Net Timber Sales Price – U.S. South (per ton):
Pulpwood
$ 16
$ 12
$ 4
32%
Sawtimber
$ 27
$ 23
$ 4
21%
Todd P. Reitz , CatchMark's Chief Resources Officer, said: "Results continue to reflect the benefits and strength of our operating model, highlighted by the flexibility gained using delivered wood and opportunistic stumpage sales. We continue to achieve substantial pricing premiums, the strategic outgrowth of concentrating prime timberland holdings in leading U.S. South mill markets. The residual impacts of regional wet weather in the third quarter kept pressure on fourth quarter logging production while customer raw material inventories remained low. The pricing tension benefited CatchMark in our markets and the favorable supply/demand dynamics, fueled by increasing homebuilding, repair and remodeling and ongoing mill expansions, remain in place entering 2022."
As planned, timber sales revenue and Harvest EBITDA decreased year-over-year due to lower harvest volumes. Lower harvest volumes followed from execution of large dispositions under the company's capital recycling program during 2021, including the highly successful Bandon property sale in Oregon and the profitable Oglethorpe large disposition in Georgia . Significant timber sales price increases in the U.S. South were generated year-over-year — 32% for pulpwood and 21% for sawtimber, and sequential quarter-over-quarter — 19% for pulpwood and 10% for sawtimber. Pulpwood and sawtimber stumpage pricing for the fourth quarter registered 52% and 38% premiums, respectively, over TimberMart-South U.S. South-wide pricing averages. Real Estate
Three Months Ended December 31,
Change
(in millions except for prices)
2021
2020
$
%
Timberland Sales Revenue
$ 1.0
$ 6.8
$ (5.8)
(86)%
Real Estate EBITDA
$ 0.9
$ 6.4
$ (5.5)
(86)%
Average Sales Price (per acre)
$ 2,597
$ 1,662
$ 935
56%
Most of CatchMark's 2021 timberland sales were executed earlier in the year, resulting in lower year-over-over activity during the fourth quarter — 400 acres sold for $1.0 million $6.8 million
Pricing for fourth quarter 2021 land sales of $2,597 $1,662 Margins also increased significantly year-over-year — 44% in the fourth quarter 2021 compared to 19% in 2020. Excellent pricing was achieved for the sold acres despite lower stocking levels as compared to prior year and compared to CatchMark's portfolio average of 39 tons per acre. Investment Management
Three Months Ended December 31,
Change
(in millions)
2021
2020
$
%
Asset Management Fee Revenue
$ 2.2
$ 3.2
$ (1.0)
(33)%
Investment Management EBITDA
$ 2.2
$ 3.2
$ (1.0)
(31)%
Lower asset management fees and investment management Adjusted EBITDA were attributable to the Triple T joint venture exit and the replacement of its asset management agreement with the transition services agreement effective through first quarter 2022.
The Dawsonville Bluffs joint venture contributed income of $63,000
FULL YEAR 2021 RESULTS
The following table summarizes the full year and comparable prior year results:
FINANCIAL HIGHLIGHTS
(in millions except for tons and acres)
Year Ended December 31,
Change
2021
2020
Dollars, Tons or Acres
%
Results of Operations
Revenues
$ 102.2
$ 104.3
$ (2.1)
(2)%
Net Income (Loss)
$ 58.4
$ (17.5)
$ 75.9
433%
Adjusted EBITDA
$ 49.4
$ 52.1
$ (2.7)
(5)%
Harvest Volume (tons)
2,046,571
2,321,363
(274,792)
(12)%
Acres Sold
7,500
9,300
(1,800)
(19)%
Business Segments Overview
Harvest Operations
Year Ended December 31,
Change
(in millions except for prices)
2021
2020
$
%
Timber Sales Revenue
$ 72.5
$ 72.3
$ 0.2
— %
Harvest EBITDA
$ 34.2
$ 34.2
$ —
— %
Net Timber Sales Price – U.S. South (per ton):
Pulpwood
$ 15
$ 13
$ 2
17 %
Sawtimber
$ 26
$ 23
$ 3
14 %
Despite planned lower harvest volumes, CatchMark generated $72.5 million $2.6 million $2.5 million Bandon property.
Harvest EBITDA was $34.2 million Bandon property. Total harvest volumes of 2.05 million were in-line with company guidance. Higher U.S. South timber sales revenue — 4% above 2020 — resulted from strong pulpwood and sawtimber pricing and a higher mix of delivered sales volume, offset by a planned 11% decrease in harvest volume, maintaining consistent productivity on a per-acre basis. In the U.S. South, CatchMark's net timber sales prices for pulpwood and sawtimber were 17% and 14% higher, respectively, compared to the prior year, trending with increases in South-wide prices. Pulpwood and sawtimber stumpage prices for the year also realized 54% and 20% premiums over U.S. South-wide averages, reflecting CatchMark's concentration of prime timberlands located in high-demand markets. Prior to selling the Bandon property in August 2021 , CatchMark generated $9.0 million 90% of full-year harvest volumes and capturing a 7% increase in weighted-average sawtimber pricing compared to prior year. The disposition resulted in a gain of $23.4 million Real Estate
Year Ended December 31,
Change
(in millions except for prices)
2021
2020
$
%
Timberland Sales Revenue
$ 14.1
$ 15.6
$ (1.6)
(10)%
Real Estate EBITDA
$ 13.4
$ 14.7
$ (1.4)
(9)%
Average Sales Price (per acre)
$ 1,867
$ 1,689
$ 178
11%
Timberland sales revenue decreased by 10% year-over-year as a result of selling 19% fewer acres than in 2020.
The company achieved an 11% higher per-acre price than 2020 despite a 19% average lower total stocking, capitalizing on strong market demand. Margins increased to 31% compared to 21% in 2020. Acres sold had an average merchantable timber stocking of 21 tons per acre, compared to 26 tons in 2020, significantly lower than CatchMark's portfolio stocking average of 39 tons. Investment Management
Year Ended December 31,
Change
(in millions)
2021
2020
$
%
Asset Management Fee Revenue
$ 11.5
$ 12.2
$ (0.7)
(6)%
Investment Management EBITDA
$ 12.3
$ 12.6
$ (0.3)
(3)%
Asset management fee revenue totaled $11.5 million $11.2 million $0.3 million
Investment Management EBITDA totaled $12.3 million 3% lower than 2020, due to a $0.7 million $0.4 million
CatchMark continued to earn a monthly Triple T management fee of $0.7 million March 31, 2022 .
CAPITAL POSITION AND SHARE REPURCHASES
CatchMark's Chief Financial Officer Ursula Godoy-Arbelaez said: "All of our deleveraging resulting from strategic initiatives, including simplifying our business, focusing operations in the U.S. South through the successful Bandon sale and exiting Triple T, have positioned us well for the next growth phase, including acquisitions and various environmental initiatives. In addition to debt capital, we have ample cash on hand to execute on growth opportunities."
During 2021, CatchMark increased its liquidity and strengthened its capital position through two profitable capital recycling dispositions — Bandon and Oglethorpe , as well as exiting Triple T. The two large dispositions, comprising 23,100 acres, totaled $107.5 million $24.2 million $100 million $23.4 million $95.4 million At year end, liquidity totaled $277 million $254 million $23 million Dividends of approximately $23.3 million $0.48 $47.2 million $34.1 million 75% to 85% . Share Repurchases: $13.7 million December 31, 2021 .
2022 GUIDANCE
For full-year 2022, CatchMark projects a GAAP net loss between $5 million $7 million $35 million $41 million -50% . Harvests are expected to increase during each of the first three quarters with fourth quarter volume approximating the average. Asset management fee revenue is projected at approximately $2 million $15 million $17 million
Davis said: "Timber sales pricing will be key to driving our 2022 performance. We expect macro demand fundamentals in the U.S. South to continue to produce sustained pricing tension, which will benefit in particular the leading markets where we concentrate our operations. All indicators point to significant growth in the U.S. South for the lumber, pellet, and pulp industries, leading to tightening wood markets and price appreciation over time. It's the largest wood market in North America and the only region which is appreciably expanding. The pellet industry is the fastest growing not only in North America but also globally. And sawmills are also expanding to meet increased demand especially given longstanding and ongoing population growth in the region. We believe we are positioned for success in the right place at the right time."
This outlook does not include potential contributions from future acquisitions and investments, including monetization of the company's environmental initiatives.
Davis continued: "In assessing new investments, we continue to be diligent and disciplined, seeking timberlands that will fit into our growth strategy. We are focusing on acquisitions with near-term cash accretion or long-term accretive portfolio attributes as well as potential for providing environmentally-focused income opportunities. We see opportunities in the marketplace, including bolt-on local acquisitions to our existing portfolio."
Conference Call The company will host a conference call and live webcast at 10 a.m. ET on Friday, February 11, 2022 to discuss these results. Investors may listen to the conference call by dialing 1-888-347-1165 for U.S/Canada and 1-412-902-4276 for international callers. Participants should ask to be joined into the CatchMark call. Access to the live webcast is available at www.catchmark.com or here . A replay of this webcast will be archived on the company's website immediately after the call.
About CatchMark CatchMark (NYSE: CTT) invests in prime timberlands located in the nation's leading mill markets, seeking to capture the highest value per acre and to generate sustainable yields through disciplined management and superior stewardship of its exceptional resources. Headquartered in Atlanta and focused exclusively on timberland ownership and management, CatchMark began operations in 2007 and owns interests in 369,700 acres* of timberlands located in Alabama, Georgia and South Carolina. For more information, visit www.catchmark.com .
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as "may," "will," "expect," "intend," "anticipate," "estimate," "believe," "continue," or other similar words. However, the absence of these or similar words or expressions does not mean that a statement is not forward-looking. Forward-looking statements are not guarantees of performance and are based on certain assumptions, discuss future expectations, describe plans and strategies, contain projections of results of operations or of financial condition or state other forward-looking information. Forward-looking statements in this press release include, but are not limited to, our expectations with respect to product price appreciation, our ability to meet our timberland sales targets, and our access to capital to support our growth strategy, that favorable supply/demand dynamics remain in place entering 2022, fueled by regional homebuilding, repair and remodeling, mill expansions and the ongoing decline in Canadian market competition , that we have ample cash on hand to execute on growth opportunities, that we see opportunities in the marketplace to pursue our acquisition strategy, and our 2022 guidance . Risks and uncertainties that could cause our actual results to differ from these forward-looking statements include, but are not limited to, that (i) the supply of timberlands available for acquisition that meet our investment criteria may be less than we currently anticipate; (ii) we may be unsuccessful in winning bids for timberland that are sold through an auction process; (iii) we may not be able to access external sources of capital at attractive rates or at all; (iv) potential increases in interest rates could have a negative impact on our business; (v) timber prices may not increase at the rate we currently anticipate or could decline, which would negatively impact our revenues; (vi) we may not generate the harvest volumes from our timberlands that we currently anticipate; (vii) the demand for our timber may not increase at the rate we currently anticipate or could decline due to changes in general economic and business conditions in the geographic regions where our timberlands are located, including as a result of the COVID-19 pandemic and the measures taken as a response thereto; (viii) a downturn in the real estate market, including decreases in demand and valuations, may adversely impact our ability to generate income and cash flow from sales of higher-and-better use properties; (ix) we may not be able to make large dispositions of timberland in capital recycling transactions at prices that are attractive to us or at all; (x) our dividends are not guaranteed and are subject to change; (xi) the markets for carbon sequestration credits, wetlands mitigation banking and solar projects are still developing and we maybe unsuccessful in generating the revenues from environmental initiatives that we currently expect or in the timeframe anticipated; (xii) our share repurchase program may not be successful in improving stockholder value over the long-term; (xiii) our joint venture strategy may not enable us to access non-dilutive capital and enhance our ability to make acquisitions; and (xiv) the factors described in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2020 and our other filings with the Securities and Exchange Commission. Accordingly, readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. We undertake no obligation to update our forward-looking statements, except as required by law.
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except for per-share amounts)
Three Months Ended
Year Ended
December 31,
2021
2020
2021
2020
Revenues:
Timber sales
$ 16,357
$ 19,945
$ 72,467
$ 72,344
Timberland sales
979
6,760
14,090
15,642
Asset management fees
2,162
3,234
11,475
12,184
Other revenues
964
1,009
4,129
4,120
20,462
30,948
102,161
104,290
Expenses
Contract logging and hauling costs
5,927
8,160
30,172
30,103
Depletion
4,787
8,178
23,729
29,112
Cost of timberland sales
550
5,479
9,664
12,290
Forestry management expenses
1,663
1,721
6,982
6,892
General and administrative expenses
3,804
3,166
13,452
16,225
Land rent expense
79
113
292
447
Other operating expenses
1,021
2,898
6,006
7,577
17,831
29,715
90,297
102,646
Other income (expense):
Interest income
—
—
2
51
Interest expense
(3,198)
(3,533)
(12,679)
(15,123)
Gain on large dispositions
72
—
24,208
1,274
(3,126)
(3,533)
11,531
(13,798)
Income (loss) before unconsolidated joint ventures and
(495)
(2,300)
23,395
(12,154)
Income (loss) from unconsolidated joint ventures:
Triple T
—
—
—
(5,000)
Dawsonville Bluffs
63
1
683
274
63
1
683
(4,726)
Gain on sale of unconsolidated joint venture interests
35,000
—
35,000
—
Income (loss) before income taxes
34,568
(2,299)
59,078
(16,880)
Income tax expense
(675)
(658)
(675)
(658)
Net income (loss)
33,893
(2,957)
58,403
(17,538)
Net income (loss) attributable to noncontrolling interests
82
(5)
141
(30)
Net income (loss) attributable to common stockholders
$ 33,811
$ (2,952)
$ 58,262
$ (17,508)
Weighted-average common shares outstanding — basic
48,442
48,765
48,420
48,816
Income (loss) per share — basic
$ 0.70
$ (0.06)
$ 1.20
$ (0.36)
Weighted-average common shares outstanding — diluted
48,446
48,765
48,481
48,816
Income (loss) per share — diluted
$ 0.70
$ (0.06)
$ 1.20
$ (0.36)
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands, except for per-share amounts)
December 31, 2021
December 31, 2020
Assets:
Cash and cash equivalents
$ 22,963
$ 11,924
Accounts receivable
5,436
8,333
Prepaid expenses and other assets
6,294
5,878
Operating lease right-of-use asset
2,527
2,831
Deferred financing costs
2,606
167
Timber assets:
Timber and timberlands, net
466,130
576,680
Intangible lease assets
1
5
Investments in unconsolidated joint ventures
1,353
1,510
Total assets
$ 507,310
$ 607,328
Liabilities:
Accounts payable and accrued expenses
$ 3,677
$ 4,808
Operating lease liability
2,707
2,988
Other liabilities
18,683
32,130
Notes payable and lines of credit, net of deferred financing costs
298,247
437,490
Total liabilities
323,314
477,416
Commitments and Contingencies
—
—
Stockholders' Equity:
Class A common stock, $0.01 par value; 900,000 shares authorized;
489
488
Additional paid-in capital
729,960
728,662
Accumulated deficit and distributions
(537,477)
(572,493)
Accumulated other comprehensive loss
(11,217)
(27,893)
Total stockholders' equity
181,755
128,764
Noncontrolling Interests
2,241
1,148
Total equity
183,996
129,912
Total liabilities and equity
$ 507,310
$ 607,328
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
Three Months Ended
Year Ended
December 31,
2021
2020
2021
2020
Cash Flows from Operating Activities:
Net income (loss)
$ 33,893
$ (2,957)
$ 58,403
$ (17,538)
Adjustments to reconcile net income (loss) to net cash
Depletion
4,787
8,178
23,729
29,112
Basis of timberland sold, lease terminations and other
493
6,618
9,325
13,606
Stock-based compensation expense
752
629
2,904
3,836
Noncash interest expense
740
584
2,448
3,053
Noncash lease expense
3
8
21
36
Other amortization
33
42
153
166
Gain on large dispositions
(72)
—
(24,208)
(1,274)
(Income) loss from unconsolidated joint ventures
(63)
(1)
(683)
4,726
Gain on sale of unconsolidated joint venture interests
(35,000)
—
(35,000)
—
Operating distributions from unconsolidated joint
683
1
683
274
Deferred income taxes
470
658
470
658
Interest paid under swaps with other-than-insignificant
1,466
1,424
5,772
4,328
Changes in assets and liabilities:
Accounts receivable
1,796
(248)
1,920
(1,340)
Prepaid expenses and other assets
(176)
(115)
(208)
(120)
Accounts payable and accrued expenses
(775)
(1,043)
(865)
916
Other liabilities
1,257
(970)
2,305
16
Net cash provided by operating activities
10,287
12,808
47,169
40,455
Cash Flows from Investing Activities:
Capital expenditures (excluding timberland acquisitions)
(985)
(1,195)
(4,908)
(5,527)
Proceeds from sale of (investments in) unconsolidated joint
35,000
—
35,000
(5,000)
Distributions from unconsolidated joint ventures
(646)
328
157
455
Net proceeds from large dispositions
—
—
106,763
20,863
Net cash provided by (used in) investing activities
33,369
(867)
137,012
10,791
Cash Flows from Financing Activities:
Repayments of notes payable
(40,000)
—
(142,705)
(20,850)
Proceeds from notes payable
—
—
—
5,000
Financing costs paid
(73)
(12)
(422)
(1,031)
Interest paid under swaps with other-than-insignificant
(1,466)
(1,424)
(5,772)
(4,328)
Dividends/distributions paid
(3,642)
(6,537)
(23,326)
(26,263)
Repurchases of common shares
(78)
(78)
(311)
(2,285)
Repurchase of common shares for minimum tax withholding
—
—
(606)
(1,052)
Net cash used in financing activities
(45,259)
(8,051)
(173,142)
(50,809)
Net change in cash and cash equivalents
(1,603)
3,890
11,039
437
Cash and cash equivalents, beginning of period
24,566
8,034
11,924
11,487
Cash and cash equivalents, end of period
$ 22,963
$ 11,924
$ 22,963
$ 11,924
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
SELECTED DATA (UNAUDITED)
2021
2020
Q1
Q2
Q3
Q4
YTD
Q1
Q2
Q3
Q4
YTD
Consolidated
Timber Sales Volume (tons, '000)
Pulpwood
273
300
286
291
1,150
324
354
349
308
1,335
Sawtimber (1)
252
228
208
209
897
271
214
231
270
986
Total
525
528
494
500
2,047
595
568
580
578
2,321
Harvest Mix
Pulpwood
52 %
57 %
58 %
58 %
56 %
54 %
62 %
60 %
53 %
58 %
Sawtimber (1)
48 %
43 %
42 %
42 %
44 %
46 %
38 %
40 %
47 %
42 %
Period-end Acres ('000)
Fee
385
375
356
356
356
393
392
391
387
387
Lease
15
15
14
14
14
22
22
22
22
22
Wholly-owned total
400
390
370
370
370
415
414
413
409
409
Joint venture interests (5)
1,081
1,080
774
—
—
1,092
1,092
1,085
1,083
1,083
Total
1,481
1,470
1,144
370
370
1,507
1,506
1,498
1,492
1,492
U.S. South
Timber Sales Volume (tons, '000)
Pulpwood
271
297
286
291
1,145
320
352
346
303
1,321
Sawtimber (1)
205
194
204
208
811
250
195
206
226
877
Total
476
491
490
499
1,956
570
547
552
529
2,198
Harvest Mix
Pulpwood
57 %
61 %
58 %
58 %
59 %
56 %
64 %
63 %
57 %
60 %
Sawtimber (1)
43 %
39 %
42 %
42 %
41 %
44 %
36 %
37 %
43 %
40 %
Delivered % as of total volume
74 %
77 %
70 %
60 %
70 %
63 %
61 %
63 %
59 %
62 %
Stumpage % as of total volume
26 %
23 %
30 %
40 %
30 %
37 %
39 %
37 %
41 %
38 %
Net Timber Sales Price ($ per ton) (2)
Pulpwood
$ 14
$ 15
$ 14
$ 16
$ 15
$ 13
$ 12
$ 13
$ 12
$ 13
Sawtimber (1)
$ 25
$ 26
$ 25
$ 27
$ 26
$ 23
$ 23
$ 22
$ 23
$ 23
Timberland Sales
Gross sales ('000)
$ 3,357
$ 7,632
$ 2,122
$ 979
$ 14,090
$ 4,779
$ 1,673
$ 2,430
$ 6,760
$ 15,642
Acres sold
1,800
4,300
1,000
400
7,500
3,000
1,100
1,200
4,000
9,300
% of fee acres
0.5 %
1.2 %
0.3 %
— %
2.0 %
0.7 %
0.3 %
0.3 %
1.0 %
2.3 %
Price per acre (3)
$ 1,923
$ 1,743
$ 2,029
$ 2,597
$ 1,867
$ 1,627
$ 1,564
$ 2,047
$ 1,662
$ 1,689
Large Dispositions (4)
Gross sales ('000)
$ —
$ 7,536
$ —
$ —
$ 7,536
$ 21,250
$ —
$ —
$ —
$ 21,250
Acres sold
—
5,000
—
—
5,000
14,400
—
—
—
14,400
Price per acre (7)
$ —
$ 1,522
$ —
$ —
$ 1,522
$ 1,474
$ —
$ —
$ —
$ 1,474
Gain ('000)
$ —
$ 759
$ —
$ —
$ 759
$ 1,274
$ —
$ —
$ —
$ 1,274
Pacific Northwest
Timber Sales Volume (tons,'000)
Pulpwood
2
3
—
—
5
4
3
3
4
14
Sawtimber (1)
47
34
4
—
85
21
18
25
45
109
Total
49
37
4
—
90
25
21
28
49
123
Harvest Mix
Pulpwood
4 %
8 %
12 %
— %
6 %
18 %
13 %
12 %
7 %
11 %
Sawtimber (1)
96 %
92 %
88 %
— %
94 %
82 %
87 %
88 %
93 %
89 %
Delivered % as of total volume
100 %
100 %
100 %
— %
100 %
84 %
100 %
100 %
100 %
97 %
Stumpage % as of total volume
— %
— %
— %
— %
— %
16 %
— %
— %
— %
3 %
Delivered Timber Sales Price ($ per ton) (2) (6)
Pulpwood
$ 30
$ 30
$ 33
$ —
$ 31
$ 31
$ 29
$ 28
$ 28
$ 29
Sawtimber (1)
$ 104
$ 106
$ 99
$ —
$ 104
$ 91
$ 84
$ 105
$ 116
$ 104
Large Dispositions (4)
Gross sales ('000)
$ —
$ —
$ 100,000
$ —
$ 100,000
$ —
$ —
$ —
$ —
$ —
Acres sold
—
—
18,100
—
18,100
—
—
—
—
—
Price per acre
$ —
$ —
$ 5,536
$ —
$ 5,536
$ —
$ —
$ —
$ —
$ —
Gain ('000)
$ —
$ —
$ 23,377
$ 72
$ 23,449
$ —
$ —
$ —
$ —
$ —
(1)
Includes chip-n-saw and sawtimber.
(2)
Prices per ton are rounded to the nearest dollar.
(3)
Excludes value of timber reservations. For the year ended December 31, 2021 and 2020, we retained 61,900 tons and 132,200 tons of merchantable inventory, with a sawtimber mix of 35% and 49% , respectively.
(4)
Large dispositions are sales of blocks of timberland properties in one or several transactions with the objective to generate proceeds to fund capital allocation priorities. Large dispositions may or may not have a higher or better use than timber production or result in a price premium above the land's timber production value. Such dispositions are infrequent in nature, are not part of core operations, and would cause material variances in comparative results if not reported separately.
(5)
Represents properties owned by Triple T joint venture in which CatchMark owned a common partnership interest; and Dawsonville Bluffs, LLC, a joint venture in which CatchMark owns a 50% membership interest.
(6)
Delivered timber sales price includes contract logging and hauling costs.
(7)
Excludes value of timber reservations, which retained 56,300 tons of merchantable inventory, with a sawtimber mix of 55% for the year ended December 31, 2020.
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA (UNAUDITED)
(in thousands)
2022 Guidance
Three Months Ended
Year Ended
December 31,
2021
2020
2021
2020
Net income (loss)
$(5,000) – (7,000)
$ 33,893
$ (2,957)
$ 58,403
$ (17,538)
Add:
Depletion
15,000 – 17,000
4,787
8,178
23,729
29,112
Interest expense (1)
10,000
2,459
2,949
10,232
12,070
Amortization (1)
2,000
776
634
2,622
3,255
Income tax expense
—
675
658
675
658
Depletion, amortization, and basis of (2)
—
13
11
126
151
Basis of timberland sold, lease terminations (3)
12,000 – 14,000
493
6,618
9,325
13,606
Stock-based compensation expense
3,000
752
629
2,904
3,836
Gain on large dispositions (4)
—
(72)
—
(24,208)
(1,274)
HLBV loss from unconsolidated joint venture (5)
—
—
—
—
5,000
Gain on sale of unconsolidated joint venture
—
(35,000)
—
(35,000)
—
Post-employment benefits (6)
—
7
17
41
2,324
Other (7)
—
246
605
558
865
Adjusted EBITDA (1)
$35,000 – 41,000
$ 9,029
$ 17,342
$ 49,407
$ 52,065
(1)
For the purpose of the above reconciliation, amortization includes amortization of deferred financing costs, amortization of operating lease assets and liabilities, amortization of intangible lease assets, and amortization of mainline road costs, which are included in either interest expense, land rent expense, or other operating expenses in the accompanying consolidated statements of operations. Includes non-cash basis of timber and timberland assets written-off related to timberland sold, terminations of timberland leases and casualty losses.
(2)
Reflects our share of depletion, amortization, and basis of timberland and mitigation credits sold of the unconsolidated Dawsonville Bluffs joint venture.
(3)
Includes non-cash basis of timber and timberland assets written-off related to timberland sold, terminations of timberland leases and casualty losses.
(4)
Large dispositions are sales of blocks of timberland properties in one or several transactions with the objective to generate proceeds to fund capital allocation priorities. Large dispositions may or may not have a higher or better use than timber production or result in a price premium above the land's timber production value. Such dispositions are infrequent in nature, are not part of core operations, and would cause material variances in comparative results if not reported separately.
(5)
Reflects HLBV losses from the Triple T joint venture, which is determined based on a hypothetical liquidation of the underlying joint venture at book value as of the reporting date. We exited from the Triple T joint venture on October 14, 2021.
(6)
Reflects one-time, non-recurring post-employment benefits associated with the retirement of our former CEO, including severance pay, payroll taxes, professional fees, and accrued dividend equivalents.
(7)
Includes certain cash expenses paid, or reimbursement received, that management believes do not directly reflect the core business operations of our timberland portfolio on an on-going basis, including costs required to be expensed by GAAP related to acquisitions, transactions, joint ventures or new business initiatives.
(8)
Adjusted EBITDA is a non-GAAP financial measure of operating performance. EBITDA is defined by the SEC as earnings before interest, taxes, depreciation and amortization; however, we have excluded certain other expenses which we believe are not indicative of the ongoing operating results of our timberland portfolio, and we refer to this measure as Adjusted EBITDA. As such, our Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. Due to the significant amount of timber assets subject to depletion, significant income (losses) from unconsolidated joint ventures based on hypothetical liquidation book value, or HLBV, and the significant amount of financing subject to interest and amortization expense, management considers Adjusted EBITDA to be an important measure of our financial performance. By providing this non-GAAP financial measure, together with the reconciliation above, we believe we are enhancing investors' understanding of our business and our ongoing results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives. Items excluded from Adjusted EBITDA are significant components in understanding and assessing financial performance. Adjusted EBITDA is a supplemental measure of operating performance that does not represent and should not be considered in isolation or as an alternative to, or substitute for net income, cash flow from operations, or other financial statement data presented in accordance with GAAP in our consolidated financial statements as indicators of our operating performance. Adjusted EBITDA has limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP.
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
ADJUSTED EBITDA BY SEGMENT (UNAUDITED)
(in thousands)
Three Months Ended
Year Ended
December 31,
2021
2020
2021
2020
Timber sales
$ 16,357
$ 19,945
$ 72,467
$ 72,344
Other revenue
964
1,009
4,129
4,120
(-) Contract logging and hauling costs
(5,927)
(8,160)
(30,172)
(30,103)
(-) Forestry management expenses
(1,663)
(1,721)
(6,982)
(6,892)
(-) Land rent expense
(79)
(113)
(292)
(447)
(-) Other operating expenses
(1,021)
(2,898)
(6,006)
(7,577)
(+) Stock-based compensation
140
110
532
417
(+/-) Other
39
1,521
505
2,328
Harvest EBITDA
8,810
9,693
34,181
34,190
Timberland sales
979
6,760
14,090
15,642
(-) Cost of timberland sales
(550)
(5,479)
(9,664)
(12,290)
(+) Basis of timberland sold
475
5,125
8,929
11,396
Real Estate EBITDA
904
6,406
13,355
14,748
Asset management fees
2,162
3,234
11,475
12,184
Unconsolidated Dawsonville Bluffs joint venture EBITDA
76
12
809
425
Investment Management EBITDA
2,238
3,246
12,284
12,609
Total Operating EBITDA
11,952
19,345
59,820
61,547
(-) General and administrative expenses
(3,804)
(3,166)
(13,452)
(16,225)
(+) Stock-based compensation
612
519
2,372
3,419
(+) Interest income
—
—
2
51
(+) Post-employment benefits
7
17
41
2,324
(+/-) Other
262
627
624
949
Corporate EBITDA
(2,923)
(2,003)
(10,413)
(9,482)
Adjusted EBITDA (1)
$ 9,029
$ 17,342
$ 49,407
$ 52,065
(1)
See definition of Adjusted EBITDA in footnote 8 to the Reconciliation of Net Income (Loss) to Adjusted EBITDA.
CATCHMARK TIMBER TRUST, INC. AND SUBSIDIARIES
CASH AVAILABLE FOR DISTRIBUTION (UNAUDITED)
(in thousands, except for per share data)
Three Months Ended
Year Ended
December 31,
2021
2020
2021
2020
Cash Provided by Operating Activities
$ 10,287
$ 12,808
$ 47,169
$ 40,455
Capital expenditures (excluding timberland acquisitions)
(985)
(1,195)
(4,908)
(5,527)
Working capital change
(2,102)
2,376
(3,152)
528
Distributions from unconsolidated joint ventures
(646)
328
157
455
Post-employment benefits
7
17
41
2,324
Interest paid under swaps with other-than-insignificant financing
(1,466)
(1,424)
(5,772)
(4,328)
Other
246
605
558
865
Cash Available for Distribution (1)
$ 5,341
$ 13,515
$ 34,093
$ 34,772
Adjusted EBITDA (2)
$ 9,029
$ 17,342
$ 49,407
$ 52,065
Interest paid
(2,459)
(2,949)
(10,232)
(12,070)
Capital expenditures (excluding timberland acquisitions)
(985)
(1,195)
(4,908)
(5,527)
Income taxes paid
(205)
—
(205)
—
Distributions from unconsolidated joint ventures
37
329
840
729
Adjusted EBITDA from unconsolidated joint ventures
(76)
(12)
(809)
(425)
Cash Available for Distribution (1)
$ 5,341
$ 13,515
$ 34,093
$ 34,772
Dividends/distributions paid
$ 3,642
$ 6,537
$ 23,326
$ 26,263
Weighted-average shares outstanding — basic
48,442
48,765
48,420
48,816
Dividends per share
$ 0.075
$ 0.135
$ 0.480
$ 0.540
(1)
Cash Available for Distribution (CAD) is a non-GAAP financial measure. It is calculated as cash provided by operating activities, adjusted for capital expenditures (excluding timberland acquisitions), working capital changes, cash distributions from unconsolidated joint ventures and certain cash expenditures that management believes do not directly reflect the core business operations of our timberland portfolio on an on-going basis, including costs required to be expensed by GAAP related to acquisitions, transactions, joint ventures or new business activities.
(2)
See definition of Adjusted EBITDA in footnote 8 to the Reconciliation of Net Income (Loss) to Adjusted EBITDA.
https://www.prnewswire.com/news-releases/catchmark-reports-fourth-quarter-and-full-year-2021-results-declares-dividend-and-provides-2022-guidance-301480224.html
SOURCE CatchMark Timber Trust, Inc.
