Rayonier Inc. REIT

Welcome and thank you for joining Rainier's first quarter 2021 teleconference call. At this time, I'll put you in mode. During the question and answer session, please press star 1 on your telephone keypad. Today's conference is being recorded. If you have any objections, you may disconnect at this time. I will turn the meeting over to Mr. Mark McHugh, Senior Vice President and Chief Financial Officer.

Thank you and good morning. Welcome to Rainier's investor teleconference covering first quarter earnings. Our earnings statements and financial supplement were released yesterday afternoon and are available on our website at rainier.com. I'd like to remind you that in these presentations, we include forward-looking statements made pursuant to the safe harbor provisions of federal securities laws. Our earnings release and Form 10-K filed with the SEC list some of the factors that may cause actual results to differ materially from the forward-looking statements we may make. They are also referenced on page two of our financial supplement. Throughout these presentations, we will also discuss non-GAAP financial measures, which are defined and reconciled to the nearest GAAP measure in our earnings release and supplemental materials. With that, let's start our teleconference with opening comments from Dave Nunez, President and CEO. Dave?

Thanks, Mark. Good morning, everyone. First, I'll make some high-level comments before turning it back over to Mark to review our consolidated financial results. Then we'll ask Doug Long, our Senior Vice President of Forest Resources, to comment on our U.S. and New Zealand timber results. And following the review of our timber results, Mark will discuss our real estate results as well as our outlook for the balance of 2021. We started 2021 with encouraging momentum across all our businesses, a testament to the strength and diversity of our timber markets and the positioning of our real estate portfolio. In the first quarter, we generated adjusted EBITDA of $70 million and pro forma EPS of eight cents per share. Adjusted EBITDA exceeded the prior year quarter by 47% as favorable results in the New Zealand timber, Pacific Northwest timber, and real estate segments more than offset a modest decline in adjusted EBITDA from our southern timber segment. As we reflect on the first quarter, We're pleased with how our team worked collaboratively to capitalize on strong domestic markets, improving real estate market trends, and growing demand for logs from China. Drilling down to our different operating segments, our southern timber segment generated adjusted EBITDA of $32 million for the quarter, which was 5% below the prior year first quarter, a 7% increase in net stumpage prices, and stronger non-timber sales were more than offset by 18% lower harvest volumes due to the front-loaded timing of 2020 harvest activity, as well as weather-related disruptions experienced earlier this year. In our Pacific Northwest timber segment, we achieved adjusted EBITDA of $18 million, an improvement of 81% versus the prior year quarter. This strong result is attributable to a sharp increase in log pricing given strong domestic demand and robust lumber markets, as well as higher volumes from the acquisition of poke resources. In our New Zealand timber segment, first quarter adjusted EBITDA more than doubled to $21 million. This year-over-year increase in adjusted EBITDA was due to significantly higher harvest volumes and saw timber prices. as the first quarter of 2020 was severely impacted by COVID-19 related headwinds. Lastly, in our real estate segment, we generated a adjusted EBITDA of $5 million. This year-over-year improvement was driven by an increase in acres sold, excluding the large disposition in 2020, amid growing buyer demand, as well as a 9% increase in weighted average prices. While improved versus the prior year quarter, we anticipated coming into the year, Q1 real estate activity was relatively light in the context of our full year expectations due to the timing of closings. With that, let me turn it back over to Mark for more details on our first quarter financial results.