Earnings for the first six months of 2014 were $85 million, or $0.47 per diluted share, on revenues of $673 million. Earnings for the first six months of 2013 were $102 million, or $0.62 per diluted share, on revenues of $643 million.
Adjusted EBITDA, a non-GAAP measure of operating performance, for the first six months of 2014 was $233 million similar to the $232 million in the same period of 2013. For the first six months of 2014, non-real estate adjusted EBITDA increased $30 million year over year driven by growth in the timber resources segments and Energy and Natural Resources segment. A reconciliation of adjusted EBITDA to net income and cash flow from operations is provided as an attachment to this release.
“Our 2Q results were much as we anticipated despite lower-than-planned harvest volumes in the South,” said Rick Holley, Plum Creek’s CEO. “So far this year, the operating income and cash flow from our timber resources segments are up nearly 30% due to improving log prices and the additional harvest from the lands we acquired in December. Our Real Estate segment continues to perform as expected and our Manufacturing segment is on track to deliver a strong performance in 2014. Our Energy and Natural Resources segment results have grown too, as the assets we acquired over the past year are providing attractive cash-on-cash returns for our shareholders.
“Cash flow from the MeadWestvaco assets acquired in December contributed more than $20 million to operating cash flow in the first six months. We expect the contribution from these assets to grow in the second half of the year, as real estate opportunities that have been identified generate cash flow in the second half of the year. We’re on track for the acquisition to be cash flow accretive on a per share basis in 2014.”
The company has revised its earnings outlook for 2014 to reflect lower harvest volumes, expectations for slower log price growth, and the anticipated composition of real estate transactions in the second half of the year. The company now expects 2014 income to be between $1.05 and $1.25 per share, and 3Q income between $0.27 and $0.32 per share.
Plum Creek is among the largest and most geographically diverse private landowners in the nation with approximately 6.7 million acres of timberlands in forest ecosystems across the northern and southeastern United States.
