For Immediate Release |
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October 14, 1997 |
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Weyerhaeuser Reports Third Quarter Earnings
of $107 Million
FEDERAL WAY Weyerhaeuser Company (NYSE:
WY) today reported third quarter net earnings
before special items of $107 million, or 53 cents
per common share, compared with $120 million, or
60 cents per common share, for the same period
last year. Net sales for the quarter ended
September 28 were $2.8 billion compared with $2.9
billion for the same quarter last year.
During the quarter, Weyerhaeuser recorded a
special after-tax net gain associated with the
companys on-going efforts to narrow its
focus and upgrade the quality of the assets of
its core businesses. The net gain of $7 million,
or 4 cents per common share, reflects a gain from
the sale of a chemical business in Canada and
charges associated with previously announced
plans to close the plywood facility in
Philadelphia, Mississippi. Including this gain,
net earnings were $114 million, or 57 cents per
common share.
For the first nine months, Weyerhaeuser
reported net earnings before special items of
$243 million, or $1.22 per common share. During
the same period last year, net earnings were $365
million, or $1.84 per common share. Including
special items, net earnings for the first nine
months in 1997 were $244 million, or $1.23 per
common share.
Net sales during the first nine months were
$8.3 billion, unchanged from the same period last
year.
"During the third quarter we continued to
see improvement in our Pulp, Paper and Packaging
business," said John W. Creighton, Jr.,
Weyerhaeuser president and chief executive
officer. "This improvement began late in the
second quarter following the implementation of
price increases in pulp, paper and newsprint.
Global economic growth continues to drive
increasing demand for pulp and paper products and
improved market prices for most pulp, paper and
packaging products. The performance of our
Timberland and Wood Products businesses, however,
has been hurt by a weak Japanese housing market.
We believe the slowdown in the Japanese market
could continue to affect our results into next
year."
Results by segment for the third quarter:
- Timberlands and Wood Products: Operating
earnings, including the charge associated
with the plywood mill closure, were $172
million. Excluding the charge, the
segment reported operating earnings of
$182 million compared with $210 million
last year. In addition to slower lumber
and log sales in Japan, lower domestic
structural panel prices also affected the
segment's performance.
- Pulp, Paper and Packaging: Operating
earnings were $97 million, including the
gain on the sale of Saskatoon Chemicals.
Excluding the gain, the segment reported
operating earnings of $76 million
compared with $79 million for the third
quarter last year.
- Real Estate and related assets: Earnings
were $24 million compared with $5 million
last year. Strong real estate markets in
the areas served by the segment
contributed to this increase.
Weyerhaeuser Company is one of the largest
integrated forest product companies in the world.
Its principal segments are timberlands and wood
products; pulp, paper and packaging; and real
estate. It is the worlds largest private
owner of merchantable softwood timber and
producer of softwood lumber and market pulp. It
also is one of North Americas largest
recyclers of office wastepaper, newspaper and
corrugated boxes.
# # #
Comments by John W. Creighton,
Jr. contain statements concerning the
companys future results and performance
that are forward-looking statements within the
meaning of the Private Securities Litigation
Reform Act of 1995. These statements are subject
to uncertainties and risks that may cause actual
results to differ materially from those
projected. The companys businesses are
cyclical in nature and are influenced by economic
factors such as interest rates, housing starts,
industrial production and GDP growth in the
United States. The companys performance is
also affected by its ability to successfully
implement its business improvement plans and
other internal performance objectives and its
ability to achieve expected returns on numerous
capital projects. Many of the companys
products are used in the manufacture of other
products and face the threat of customers
substituting other materials. The company is also
a large exporter and is affected both by changes
in economic activity in Europe and Asia,
particularly by changes in GDP and housing starts
in Japan, our largest export market, and by
changes in currency exchange rates. The
companys timberlands and manufacturing
facilities are subject to extensive forestry,
land use and environmental regulations that
change frequently. The companys major
businesses are also affected by government
policies regarding the management of public lands
in the United States and Canada and by
international trade restrictions. In addition to
unanticipated changes in government regulation
and policy, natural disasters and unusual weather
conditions can damage the companys forests
and operations and impact supply conditions for
the companys products.
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