Net cash provided by the Deltic Timber’s operating activities was $3.7 million in the 1Q 2014, compared to $9 million a year ago.
Commenting on the results, President and CEO, Ray C. Dillon, stated, “Harsh winter weather conditions existed for much of the United States during the first quarter. Despite the negative impact this had on the consumption of softwood lumber for construction, Deltic’s operations again generated solid financial results. While the volume of lumber sold and the average sales price received for it were both down from a year ago, the Company harvested its planned volume for pine sawtimber and pine pulpwood for the quarter, benefitted from improved natural gas prices, and sold almost twice as many residential real estate lots than it did in the first quarter of last year. During the quarter, we also successfully completed a significant timberland acquisition in the Ola Region that will be strategically beneficial to our operations there.”
The Woodlands segment had operating income of $5.3 million for the 1Q 2014, compared to $4.6 million for the same period of 2013. The Company harvested 209,548 tons of pine sawtimber during the current period of 2014, a 16% increase from the 181,069 tons harvested in the corresponding quarter of 2013. The average per-ton sales price for pine sawtimber in 2014’s 1Q was $24, a 4% increase from the $23 per ton during the 1Q 2013.
Pine pulpwood harvested in the 1Q 2014 totaled 109,009 tons, a 12% increase from the 97,010 tons harvested for the same period in 2013. The average per-ton sales price was $8 for the current period of 2014, compared to $9 per-ton for 2013’s 1Q. The quarter-over-quarter increase in both pine sawtimber and pulpwood harvest volumes was mainly due to timing and the mix of products growing on the tracts harvested. Oil and gas lease rental and net royalty income totaled $1.4 million for the current period of 2014 compared to $1.2 million during the same quarter of 2013. The increase was due to a combination of higher natural gas prices and increased production volumes for gas wells from which the Company receives royalty payments. During the current quarter, the Company sold 160 acres of non-strategic recreational-use hardwood bottomland at an average sales price of $1,000 per acre versus 1Q 2013 sales of 288 acres at an average price of $1,800 per acre.
Deltic’s Manufacturing segment reported operating income of $8.3 million for the 1Q 2014, which compares to $11.3 million in 1Q 2013. The average lumber sales price was $378 per thousand board feet in the 1Q 2014, a 6% decrease from the $402 per thousand board feet realized for the 1Q 2013.
During the 1Q 2014, the Company sold 64.3 million board feet, a decrease of 6.8 million board feet when compared to sales of 71.1 million board feet in 2013’s 1Q, as the Company decreased lumber production to match market demand.