x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Washington | 91-0470860 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | |
33663 Weyerhaeuser Way South Federal Way, Washington | 98063-9777 | |
(Address of principal executive offices) | (Zip Code) |
PART I | FINANCIAL INFORMATION | |
ITEM 1. | FINANCIAL STATEMENTS: | |
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
PART II | OTHER INFORMATION | |
ITEM 1. | ||
ITEM 1A. | ||
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS | NA |
ITEM 3. | DEFAULTS UPON SENIOR SECURITIES | NA |
ITEM 4. | MINE SAFETY DISCLOSURES | NA |
ITEM 5. | OTHER INFORMATION | NA |
ITEM 6. | ||
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES | MARCH 2013 | MARCH 2012 | |||||
Net sales | $ | 1,951 | $ | 1,494 | |||
Cost of products sold | 1,533 | 1,290 | |||||
Gross margin | 418 | 204 | |||||
Selling expenses | 51 | 42 | |||||
General and administrative expenses | 118 | 108 | |||||
Research and development expenses | 7 | 7 | |||||
Charges for restructuring, closures and impairments | 4 | 12 | |||||
Other operating income, net (Note 11) | (18 | ) | (66 | ) | |||
Operating income | 256 | 101 | |||||
Interest income and other | 11 | 12 | |||||
Interest expense, net of capitalized interest | (82 | ) | (87 | ) | |||
Earnings before income taxes | 185 | 26 | |||||
Income taxes (Note 12) | (41 | ) | 15 | ||||
Net earnings attributable to Weyerhaeuser common shareholders | $ | 144 | $ | 41 | |||
Earnings per share attributable to Weyerhaeuser common shareholders, basic and diluted (Note 3) | $ | 0.26 | $ | 0.08 | |||
Dividends paid per share | $ | 0.17 | $ | 0.15 | |||
Weighted average shares outstanding (in thousands) (Note 3): | |||||||
Basic | 545,234 | 537,368 | |||||
Diluted | 550,785 | 539,728 |
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Net earnings attributable to Weyerhaeuser common shareholders | $ | 144 | $ | 41 | |||
Other comprehensive income (loss): | |||||||
Foreign currency translation adjustments | (17 | ) | 11 | ||||
Actuarial gains, net of tax expense of $23 and $12 | 48 | 23 | |||||
Prior service costs, net of tax benefit of $0 and $30 | (4 | ) | (70 | ) | |||
Unrealized gains on available-for-sale securities | 1 | 1 | |||||
Total other comprehensive income (loss) | 28 | (35 | ) | ||||
Comprehensive income attributable to Weyerhaeuser common shareholders | $ | 172 | $ | 6 |
DOLLAR AMOUNTS IN MILLIONS | MARCH 31, 2013 | DECEMBER 31, 2012 | |||||
ASSETS | |||||||
Forest Products: | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 635 | $ | 893 | |||
Receivables, less allowances of $4 and $3 | 628 | 468 | |||||
Receivables for taxes | 65 | 95 | |||||
Inventories (Note 4) | 596 | 531 | |||||
Prepaid expenses | 89 | 83 | |||||
Deferred tax assets | 189 | 65 | |||||
Total current assets | 2,202 | 2,135 | |||||
Property and equipment, less accumulated depreciation of $6,350 and $6,350 | 2,785 | 2,859 | |||||
Construction in progress | 56 | 50 | |||||
Timber and timberlands at cost, less depletion charged to disposals | 3,954 | 3,961 | |||||
Investments in and advances to equity affiliates | 191 | 192 | |||||
Goodwill | 40 | 40 | |||||
Deferred tax assets | 70 | 189 | |||||
Other assets | 351 | 358 | |||||
Assets held by variable interest entities | 804 | 805 | |||||
10,453 | 10,589 | ||||||
Real Estate: | |||||||
Cash and cash equivalents | 4 | 5 | |||||
Receivables, less discounts and allowances of $4 and $4 | 75 | 72 | |||||
Real estate in process of development and for sale | 724 | 658 | |||||
Land being processed for development | 897 | 904 | |||||
Investments in and advances to equity affiliates | 20 | 21 | |||||
Deferred tax assets | 204 | 202 | |||||
Other assets | 100 | 94 | |||||
Assets held by variable interest entities | 33 | 47 | |||||
2,057 | 2,003 | ||||||
Total assets | $ | 12,510 | $ | 12,592 |
MARCH 31, 2013 | DECEMBER 31, 2012 | ||||||
LIABILITIES AND EQUITY | |||||||
Forest Products: | |||||||
Current liabilities: | |||||||
Current maturities of long-term debt (Note 7) | $ | 184 | $ | 340 | |||
Accounts payable | 357 | 329 | |||||
Accrued liabilities (Note 6) | 531 | 561 | |||||
Total current liabilities | 1,072 | 1,230 | |||||
Long-term debt (Note 7) | 3,842 | 3,842 | |||||
Deferred income taxes | 46 | — | |||||
Deferred pension and other postretirement benefits | 1,856 | 1,930 | |||||
Other liabilities | 455 | 499 | |||||
Liabilities (nonrecourse to the company) held by variable interest entities | 680 | 681 | |||||
7,951 | 8,182 | ||||||
Real Estate: | |||||||
Long-term debt (Note 7) | 109 | 109 | |||||
Other liabilities | 172 | 187 | |||||
Liabilities (nonrecourse to the company) held by variable interest entities | 2 | 1 | |||||
283 | 297 | ||||||
Commitments and contingencies (Note 8) | |||||||
Total liabilities | 8,234 | 8,479 | |||||
Equity: | |||||||
Weyerhaeuser shareholders’ interest: | |||||||
Common shares: $1.25 par value; authorized 1,360,000,000 shares; issued and outstanding: 546,572,906 and 542,392,642 shares | 683 | 678 | |||||
Other capital | 4,827 | 4,731 | |||||
Retained earnings | 264 | 219 | |||||
Cumulative other comprehensive loss (Note 9) | (1,530 | ) | (1,558 | ) | |||
Total Weyerhaeuser shareholders’ interest | 4,244 | 4,070 | |||||
Noncontrolling interests | 32 | 43 | |||||
Total equity | 4,276 | 4,113 | |||||
Total liabilities and equity | $ | 12,510 | $ | 12,592 |
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Cash flows from operations: | |||||||
Net earnings | $ | 144 | $ | 41 | |||
Noncash charges (credits) to earnings: | |||||||
Depreciation, depletion and amortization | 112 | 113 | |||||
Deferred income taxes, net | 26 | (6 | ) | ||||
Pension and other postretirement benefits (Note 5) | 24 | (28 | ) | ||||
Share-based compensation expense | 12 | 10 | |||||
Charges for impairment of assets | 1 | 8 | |||||
Net gains on dispositions of assets(1) | (7 | ) | (7 | ) | |||
Foreign exchange transaction (gains) losses (Note 11) | 4 | (7 | ) | ||||
Change in: | |||||||
Receivables less allowances | (165 | ) | (5 | ) | |||
Receivable for taxes | 30 | (2 | ) | ||||
Inventories | (68 | ) | (40 | ) | |||
Real estate and land | (59 | ) | (55 | ) | |||
Prepaid expenses | (13 | ) | (8 | ) | |||
Accounts payable and accrued liabilities | (66 | ) | (56 | ) | |||
Deposits on land positions and other assets | (1 | ) | — | ||||
Pension and postretirement contributions / benefit payments | (37 | ) | (35 | ) | |||
Other | 2 | 17 | |||||
Net cash from operations | (61 | ) | (60 | ) | |||
Cash flows from investing activities: | |||||||
Property and equipment | (35 | ) | (54 | ) | |||
Timberlands reforestation | (13 | ) | (10 | ) | |||
Proceeds from sale of assets | 6 | 6 | |||||
Other | — | 1 | |||||
Cash from investing activities | (42 | ) | (57 | ) | |||
Cash flows from financing activities: | |||||||
Cash dividends | (93 | ) | (81 | ) | |||
Change in book overdrafts | 3 | (29 | ) | ||||
Payments on debt | (156 | ) | (2 | ) | |||
Exercises of stock options | 81 | 5 | |||||
Other | 9 | (1 | ) | ||||
Cash from financing activities | (156 | ) | (108 | ) | |||
Net change in cash and cash equivalents | (259 | ) | (225 | ) | |||
Cash and cash equivalents at beginning of period | 898 | 953 | |||||
Cash and cash equivalents at end of period | $ | 639 | $ | 728 | |||
Cash paid (received) during the period for: | |||||||
Interest, net of amount capitalized of $5 and $5 | $ | 111 | $ | 114 | |||
Income taxes | $ | (2 | ) | $ | (10 | ) |
(1) | Includes gains on timberland exchanges. |
NOTE 1: | ||
NOTE 2: | ||
NOTE 3: | ||
NOTE 4: | ||
NOTE 5: | ||
NOTE 6: | ||
NOTE 7: | ||
NOTE 8: | ||
NOTE 9: | ||
NOTE 10: | ||
NOTE 11: | ||
NOTE 12: |
• | majority-owned domestic and foreign subsidiaries and |
• | variable interest entities in which we are the primary beneficiary. |
• | Forest Products – our forest products-based operations, principally the growing and harvesting of timber, the manufacture, distribution and sale of forest products and corporate governance activities; and |
• | Real Estate – our real estate development and single-family home building operations. |
• | Timberlands – which includes logs; timber; minerals, oil and gas; and international wood products; |
• | Wood Products – which includes softwood lumber, engineered lumber, structural panels and building materials distribution; |
• | Cellulose Fibers – which includes pulp, liquid packaging board and an equity interest in a newsprint joint venture; and |
• | Real Estate – which includes real estate development and single-family home building operations. |
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Sales to unaffiliated customers: | |||||||
Timberlands | $ | 293 | $ | 250 | |||
Wood Products | 988 | 634 | |||||
Cellulose Fibers | 474 | 473 | |||||
Real Estate | 196 | 137 | |||||
1,951 | 1,494 | ||||||
Intersegment sales: | |||||||
Timberlands | 224 | 190 | |||||
Wood Products | 18 | 20 | |||||
242 | 210 | ||||||
Total sales | 2,193 | 1,704 | |||||
Intersegment eliminations | (242 | ) | (210 | ) | |||
Total | $ | 1,951 | $ | 1,494 | |||
Net contribution to earnings: | |||||||
Timberlands | $ | 104 | $ | 70 | |||
Wood Products | 178 | (13 | ) | ||||
Cellulose Fibers | 31 | 48 | |||||
Real Estate | — | (8 | ) | ||||
313 | 97 | ||||||
Unallocated Items(1) | (46 | ) | 16 | ||||
Net contribution to earnings | 267 | 113 | |||||
Interest expense, net of capitalized interest | (82 | ) | (87 | ) | |||
Income before income taxes | 185 | 26 | |||||
Income taxes | (41 | ) | 15 | ||||
Net earnings attributable to Weyerhaeuser common shareholders | $ | 144 | $ | 41 |
(1) | Unallocated Items are gains or charges not related to or allocated to an individual operating segment. They include a portion of items such as: share-based compensation; pension and postretirement costs; foreign exchange transaction gains and losses associated with financing; and the elimination of intersegment profit in inventory and the LIFO reserve. |
• | $0.26 during first quarter 2013; and |
• | $0.08 during first quarter 2012. |
• | weighted average number of our outstanding common shares and |
• | the effect of our outstanding dilutive potential common shares. |
• | outstanding stock options, |
• | restricted stock units and |
• | performance share units. |
QUARTER ENDED | |||||
SHARES IN THOUSANDS | MARCH 2013 | MARCH 2012 | |||
Stock options | 5,200 | 20,521 | |||
Performance share units | 519 | 548 |
DOLLAR AMOUNTS IN MILLIONS | MARCH 31, 2013 | DECEMBER 31, 2012 | |||||
Logs and chips | $ | 107 | $ | 72 | |||
Lumber, plywood, panels and engineered lumber | 190 | 151 | |||||
Pulp and paperboard | 176 | 185 | |||||
Other products | 92 | 96 | |||||
Materials and supplies | 142 | 139 | |||||
707 | 643 | ||||||
Less LIFO reserve | (111 | ) | (112 | ) | |||
Total | $ | 596 | $ | 531 |
PENSION | |||||||
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Service cost | $ | 16 | $ | 14 | |||
Interest cost | 60 | 65 | |||||
Expected return on plan assets | (109 | ) | (105 | ) | |||
Amortization of actuarial loss | 55 | 42 | |||||
Amortization of prior service cost | 2 | 2 | |||||
Total net periodic benefit cost | $ | 24 | $ | 18 |
OTHER POSTRETIREMENT BENEFITS | |||||||
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Interest cost | $ | 3 | $ | 4 | |||
Amortization of actuarial loss | 3 | 4 | |||||
Amortization of prior service credit | (6 | ) | (58 | ) | |||
Other | — | 4 | |||||
Total net periodic benefit credit | $ | — | $ | (46 | ) |
• | make approximately $88 million of required contributions to our Canadian registered and nonregistered pension plans in 2013; |
• | make benefit payments of $19 million to our U.S. nonqualified pension plans; and |
• | make benefit payments of $37 million related to our U.S. and Canadian other postretirement plans. |
DOLLAR AMOUNTS IN MILLIONS | MARCH 31, 2013 | DECEMBER 31, 2012 | |||||
Wages, salaries and severance pay | $ | 124 | $ | 139 | |||
Pension and postretirement | 57 | 58 | |||||
Vacation pay | 50 | 46 | |||||
Income taxes | 15 | — | |||||
Taxes – Social Security and real and personal property | 30 | 27 | |||||
Interest | 70 | 99 | |||||
Customer rebates and volume discounts | 34 | 44 | |||||
Deferred income | 54 | 60 | |||||
Other | 97 | 88 | |||||
Total | $ | 531 | $ | 561 |
MARCH 31, 2013 | DECEMBER 31, 2012 | ||||||||||||||
DOLLAR AMOUNTS IN MILLIONS | CARRYING VALUE | FAIR VALUE (LEVEL 2) | CARRYING VALUE | FAIR VALUE (LEVEL 2) | |||||||||||
Long-term debt (including current maturities): | |||||||||||||||
Forest Products | $ | 4,026 | $ | 4,920 | $ | 4,182 | $ | 4,994 | |||||||
Real Estate | $ | 109 | $ | 112 | $ | 109 | $ | 112 |
• | market approach – based on quoted market prices for the same types and issues of our debt; or |
• | income approach – based on the discounted value of the future cash flows using market yields for the same type and comparable issues of debt. |
• | the short-term nature of these instruments, |
• | carrying short-term investments at expected net realizable value and |
• | the allowance for doubtful accounts. |
• | legal proceedings and |
• | environmental matters. |
• | is subject to a great many variables and |
• | cannot be predicted with any degree of certainty. |
• | could have a material adverse effect on our results of operations, cash flows or financial position in any given quarter or year; but |
• | will not have a material adverse effect on our long-term results of operations, cash flows or financial position. |
• | site remediation and |
• | asset retirement obligations. |
• | are a party to various proceedings related to the cleanup of hazardous waste sites and |
• | have been notified that we may be a potentially responsible party related to the cleanup of other hazardous waste sites for which proceedings have not yet been initiated. |
PENSION | OTHER POSTRETIREMENT BENEFITS | ||||||||||||||||||||
DOLLAR AMOUNTS IN MILLIONS | Foreign currency translation adjustments | Actuarial losses | Prior service costs | Actuarial losses | Prior service credits | Unrealized gains on available-for-sale securities | Total | ||||||||||||||
Beginning balance as of December 31, 2012 | $ | 413 | $ | (1,942 | ) | $ | (23 | ) | $ | (137 | ) | $ | 127 | $ | 4 | $ | (1,558 | ) | |||
Other comprehensive income (loss) before reclassifications | (17 | ) | 13 | — | — | — | 1 | (3 | ) | ||||||||||||
Income taxes | — | (3 | ) | — | — | — | — | (3 | ) | ||||||||||||
Net other comprehensive income (loss) before reclassifications | (17 | ) | 10 | — | — | — | 1 | (6 | ) | ||||||||||||
Amounts reclassified from cumulative other comprehensive income (loss)(1) | — | 55 | 2 | 3 | (6 | ) | — | 54 | |||||||||||||
Income taxes | — | (19 | ) | (1 | ) | (1 | ) | 1 | — | (20 | ) | ||||||||||
Net amounts reclassified from cumulative other comprehensive income (loss) | — | 36 | 1 | 2 | (5 | ) | — | 34 | |||||||||||||
Total other comprehensive income (loss) | (17 | ) | 46 | 1 | 2 | (5 | ) | 1 | 28 | ||||||||||||
Ending balance as of March 31, 2013 | $ | 396 | $ | (1,896 | ) | $ | (22 | ) | $ | (135 | ) | $ | 122 | $ | 5 | $ | (1,530 | ) | |||
(1) Actuarial losses and prior service credits (cost) are included in the computation of net periodic benefit costs (credits). See Note 5: Pension and Other Postretirement Benefit Plans. |
• | options vest ratably over 4 years; |
• | options vest or continue to vest in the event of disability or death; |
• | options continue to vest upon retirement at an age of at least 62, but a portion of the grant is forfeited if retirement occurs before the one year anniversary of the grant depending on the employment period after grant date; |
• | options continue vesting for one year in the event of involuntary termination when the retirement criteria has not been met; and |
• | options stop vesting and are forfeited for all other situations including early retirement prior to age 62. |
OPTIONS | |||
Expected volatility | 38.00 | % | |
Expected dividends | 2.23 | % | |
Expected term (in years) | 4.97 | ||
Risk-free rate | 0.92 | % | |
Weighted average grant date fair value | $ | 8.40 |
• | restricted stock units vest ratably over 4 years; |
• | restricted stock units immediately vest in the event of disability or death while employed; |
• | restricted stock units continue to vest upon retirement at an age of at least 62, but a portion of the grant is forfeited if retirement occurs before the one year anniversary of the grant depending on the employment period after grant date; |
• | restricted stock units continue vesting for one year in the event of involuntary termination when the retirement criteria has not been met; and |
• | restricted stock units will be forfeited upon termination of employment in all other situations including early retirement prior to age 62. |
• | units vest 50 percent, 25 percent and 25 percent on the second, third and fourth anniversaries of the grant date, respectively, as long as the individual remains employed by the company; |
• | units fully vest in the event of disability or death while employed; |
• | units continue to vest upon retirement at an age of at least 62, but a portion of the grant is forfeited if retirement occurs before the one year anniversary of the grant depending on the employment period after grant date; |
• | units continue vesting for one year in the event of involuntary termination when the retirement criteria has not been met; and |
• | units will be forfeited upon termination of employment in all other situations including early retirement prior to age 62. |
Performance Share Units | ||||||
Performance period | 1/1/2013 – 12/31/2014 | |||||
Valuation date closing stock price | $ | 30.48 | ||||
Expected dividends | 2.23 | % | ||||
Risk-free rate | 0.09 | % | – | 0.46 | % | |
Expected volatility | 22.09 | % | – | 29.57 | % |
MARCH 31, 2013 | |||
Expected volatility | 25.48 | % | |
Expected dividends | 2.17 | % | |
Expected term (in years) | 1.33 | ||
Risk-free rate | 0.20 | % | |
Weighted average fair value | $ | 8.93 |
• | includes both recurring and occasional income and expense items and |
• | can fluctuate from year to year. |
QUARTER ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Gain on postretirement plan amendment (Note 5) | $ | — | $ | (52 | ) | ||
Gain on disposition of assets | (6 | ) | (1 | ) | |||
Foreign exchange losses (gains), net | 4 | (7 | ) | ||||
Land management income | (6 | ) | (6 | ) | |||
Other, net | (10 | ) | — | ||||
Total other operating income, net | $ | (18 | ) | $ | (66 | ) |
DOLLAR AMOUNTS IN MILLIONS | |||
First Quarter 2012: | |||
Income taxes on postretirement plan amendment discussed in Note 5 | $ | (18 | ) |
State income tax settlements | $ | 8 |
• | are based on various assumptions we make and |
• | may not be accurate because of risks and uncertainties surrounding the assumptions that we make. |
• | improved selling prices for Western domestic and export logs, slightly lower fee harvest volumes, flat realization and somewhat higher fee harvest volumes in the South, seasonally higher silviculture expenses, somewhat higher earnings from dispositions of non-strategic timberlands and comparable earnings in our Timberlands segment excluding disposition of non-strategic timberlands; |
• | higher sales volumes across all product lines, slightly higher sales realization for engineered wood products, potential softening in prices for lumber and oriented strand board, slightly higher log costs, improved operating rates and comparable earnings in our Wood Products segment; |
• | slightly higher pulp price realizations, lower maintenance costs, lower fiber and energy costs and significantly higher earnings in our Cellulose Fiber segment; and |
• | seasonally increased home closings to approximately 600 single-family homes, slight decline in average price of homes closed due to mix, average margins comparable to first quarter 2013, higher selling-related expenses due to additional closing volume and a slight profit from single-family homebuilding in our Real Estate segment. |
• | the economy; |
• | regulations; |
• | adverse litigation outcomes and the adequacy of reserves; |
• | changes in accounting principles; |
• | contributions to pension plans; |
• | projected benefit payments; |
• | projected tax rates and credits; and |
• | other related matters. |
• | the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages and strength of the U.S. dollar; |
• | market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; |
• | performance of our manufacturing operations, including maintenance requirements; |
• | the level of competition from domestic and foreign producers; |
• | the successful execution of our internal performance plans, including restructurings and cost reduction initiatives; |
• | raw material prices; |
• | energy prices; |
• | the effect of weather; |
• | the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters; |
• | transportation costs; |
• | federal tax policies; |
• | the effect of forestry, land use, environmental and other governmental regulations; |
• | legal proceedings; |
• | performance of pension fund investments and related derivatives; |
• | the effect of timing of retirements and changes in the market price of our common stock on charges for share-based compensation; |
• | changes in accounting principles; and |
• | other factors described under “Risk Factors” in our annual report on Form 10-K. |
• | economic activity in Europe and Asia – particularly Japan and China; |
• | currency exchange rates – particularly the relative value of the U.S. dollar to the euro and Canadian dollar and the relative value of the euro and yen; and |
• | restrictions on international trade or tariffs imposed on imports. |
• | Price realizations refer to net selling prices – this includes selling price plus freight, minus normal sales deductions. |
• | Net contribution to earnings can be positive or negative and refers to earnings (loss) attributable to Weyerhaeuser shareholders before interest expense and income taxes. |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | ||||||||
Net sales | $ | 1,951 | $ | 1,494 | $ | 457 | |||||
Operating income | $ | 256 | $ | 101 | $ | 155 | |||||
Net earnings attributable to Weyerhaeuser common shareholders | $ | 144 | $ | 41 | $ | 103 | |||||
Net earnings per share attributable to Weyerhaeuser common shareholders, basic and diluted | $ | 0.26 | $ | 0.08 | $ | 0.18 |
• | Wood Products segment sales increased $354 million, primarily due to higher sales volumes across all major product lines and improved selling prices for lumber, oriented strand board (OSB) and plywood. |
• | Real Estate segment sales increased $59 million primarily due to increased home closings and improved average prices for homes closed. |
• | Timberlands segment sales increased $43 million, primarily due to higher export and domestic log prices and increased sales volume. |
• | a $56 million increase in income taxes primarily due to higher income in our TRS in 2013 compared to 2012; and |
• | a $52 million pretax gain recognized in 2012 related to a previously announced postretirement plan amendment. |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | ||||||||
Net sales to unaffiliated customers: | |||||||||||
Logs: | |||||||||||
West | $ | 177 | $ | 130 | $ | 47 | |||||
South | 61 | 50 | 11 | ||||||||
Canada | 7 | 7 | — | ||||||||
Subtotal logs sales | 245 | 187 | 58 | ||||||||
Pay as cut timber sales | 1 | 3 | (2 | ) | |||||||
Chip sales | 3 | 6 | (3 | ) | |||||||
Timberlands exchanges(1) | 2 | 8 | (6 | ) | |||||||
Higher and better-use land sales(1) | 3 | 4 | (1 | ) | |||||||
Minerals, oil and gas | 8 | 7 | 1 | ||||||||
Products from international operations(2) | 22 | 25 | (3 | ) | |||||||
Other products | 9 | 10 | (1 | ) | |||||||
Subtotal net sales to unaffiliated customers | 293 | 250 | 43 | ||||||||
Intersegment sales: | |||||||||||
United States | 127 | 112 | 15 | ||||||||
Other | 97 | 78 | 19 | ||||||||
Subtotal intersegment sales | 224 | 190 | 34 | ||||||||
Total sales | $ | 517 | $ | 440 | $ | 77 | |||||
Net contribution to earnings | $ | 104 | $ | 70 | $ | 34 |
(1) | Significant dispositions of higher and better use timberland and some non-strategic timberlands are made through Forest Products subsidiaries. |
(2) | Products include logs, plywood and hardwood lumber harvested or produced by our international operations, primarily in South America. |
• | Western log sales increased $47 million due to higher export and domestic log prices and a 28 percent increase in sales volume as a result of increased export and domestic demand. |
• | Southern log sales increased $11 million due to higher log prices and a 14 percent increase in sales volumes as the result of increased harvest levels in response to increased third party demand. |
• | a $19 million increase due to higher log prices and increased sales volumes in Canada; and |
• | a $15 million increase primarily due to higher log prices in the West and South. |
• | a $27 million increase due to higher log prices in the West and South; and |
• | an $11 million increase due to higher sales volumes and demand for export and domestic logs in the West; harvest levels increased 19 percent in the West. |
QUARTER ENDED | AMOUNT OF CHANGE | |||||||
VOLUMES IN THOUSANDS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | |||||
Third party log sales – cubic meters: | ||||||||
West | 1,674 | 1,308 | 366 | |||||
South | 1,399 | 1,228 | 171 | |||||
Canada | 204 | 205 | (1 | ) | ||||
International | 68 | 78 | (10 | ) | ||||
Total | 3,345 | 2,819 | 526 | |||||
Fee harvest volumes – cubic meters: | ||||||||
West | 1,995 | 1,679 | 316 | |||||
South | 2,833 | 2,714 | 119 | |||||
International | 197 | 172 | 25 | |||||
Total | 5,025 | 4,565 | 460 |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | ||||||||
Net sales: | |||||||||||
Structural lumber | $ | 451 | $ | 291 | $ | 160 | |||||
Engineered solid section | 82 | 65 | 17 | ||||||||
Engineered I-joists | 56 | 41 | 15 | ||||||||
Oriented strand board | 236 | 111 | 125 | ||||||||
Softwood plywood | 36 | 23 | 13 | ||||||||
Other products produced | 43 | 42 | 1 | ||||||||
Complementary products purchased for resale | 84 | 61 | 23 | ||||||||
Total | $ | 988 | $ | 634 | $ | 354 | |||||
Net contribution to earnings | $ | 178 | $ | (13 | ) | $ | 191 |
• | Structural lumber shipment volumes increased 9 percent and average price realizations increased 41 percent. |
• | OSB shipment volumes increased 16 percent and average price realizations increased 82 percent. |
• | Engineered solid section shipment volumes increased 22 percent. |
• | Engineered I-joists shipment volumes increased 34 percent. |
• | Softwood plywood shipment volumes increased 36 percent and average price realizations increased 20 percent. |
• | Other products purchased for resale increased 38 percent. |
• | a $215 million increase primarily due to higher lumber, OSB and plywood price realizations; and |
• | a $14 million increase in sales volumes across all products. |
• | a $23 million increase in log cost due to continued strong lumber demand and increasing log prices; and |
• | a $17 million increase in freight expense due to higher shipment volumes. |
QUARTER ENDED | AMOUNT OF CHANGE | |||||||
VOLUMES IN MILLIONS(1) | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | |||||
Structural lumber – board feet | 1,025 | 937 | 88 | |||||
Engineered solid section – cubic feet | 4.4 | 3.6 | 0.8 | |||||
Engineered I-joists – lineal feet | 43 | 32 | 11 | |||||
Oriented strand board – square feet (3/8”) | 657 | 565 | 92 | |||||
Softwood plywood – square feet (3/8”) | 99 | 73 | 26 |
QUARTER ENDED | AMOUNT OF CHANGE | |||||||
VOLUMES IN MILLIONS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | |||||
Structural lumber – board feet: | ||||||||
Production | 1,021 | 958 | 63 | |||||
Outside purchase | 102 | 32 | 70 | |||||
Total | 1,123 | 990 | 133 | |||||
Engineered solid section – cubic feet: | ||||||||
Production | 4.6 | 3.7 | 0.9 | |||||
Outside purchase | 0.9 | 1.0 | (0.1 | ) | ||||
Total | 5.5 | 4.7 | 0.8 | |||||
Engineered I-joists – lineal feet: | ||||||||
Production | 44 | 34 | 10 | |||||
Outside purchase | 3 | 2 | 1 | |||||
Total | 47 | 36 | 11 | |||||
Oriented strand board – square feet (3/8”): | ||||||||
Production | 662 | 601 | 61 | |||||
Outside purchase | 68 | 32 | 36 | |||||
Total | 730 | 633 | 97 | |||||
Softwood plywood – square feet (3/8”): | ||||||||
Production | 61 | 51 | 10 | |||||
Outside purchase | 42 | 25 | 17 | |||||
Total | 103 | 76 | 27 |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | ||||||||
Net sales: | |||||||||||
Pulp | $ | 371 | $ | 367 | $ | 4 | |||||
Liquid packaging board | 85 | 83 | 2 | ||||||||
Other products | 18 | 23 | (5 | ) | |||||||
Total | $ | 474 | $ | 473 | $ | 1 | |||||
Net contribution to earnings | $ | 31 | $ | 48 | $ | (17 | ) |
• | Increased sales volumes of 4 percent for pulp were partially offset by decreased price realizations of $22 per ton – 3 percent as global market conditions remained relatively weak. |
• | Sales volumes for liquid packaging board increased 8,000 tons – 11 percent, which was largely offset by decreased price realizations of $102 per ton – 9 percent. |
• | a $10 million decrease due to lower pulp price realizations and |
• | an $8 million decrease in liquid packaging board price realizations. |
QUARTER ENDED | AMOUNT OF CHANGE | |||||||
VOLUMES IN THOUSANDS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | |||||
Pulp – air-dry metric tons | 467 | 449 | 18 | |||||
Liquid packaging board – tons | 78 | 70 | 8 |
QUARTER ENDED | AMOUNT OF CHANGE | |||||||
VOLUMES IN THOUSANDS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | |||||
Pulp – air-dry metric tons | 445 | 438 | 7 | |||||
Liquid packaging board – tons | 78 | 65 | 13 |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | ||||||||
Net sales: | |||||||||||
Single-family housing | $ | 183 | $ | 131 | $ | 52 | |||||
Land | 11 | 3 | 8 | ||||||||
Other | 2 | 3 | (1 | ) | |||||||
Total | $ | 196 | $ | 137 | $ | 59 | |||||
Net contribution to earnings | $ | — | $ | (8 | ) | $ | 8 |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | |||||||||
Homes sold | 820 | 697 | 123 | ||||||||
Homes closed | 463 | 349 | 114 | ||||||||
Homes sold but not closed (backlog) | 1,131 | 777 | 354 | ||||||||
Cancellation rate | 12.2 | % | 10.1 | % | 2.1 | % | |||||
Traffic | 17,764 | 14,272 | 3,492 | ||||||||
Average price of homes closed (in thousands) | $ | 394 | $ | 376 | $ | 18 | |||||
Single-family gross margin(1) | 19.5 | % | 17.2 | % | 2.3 | % |
• | Single-family housing revenues increased $52 million. Home closings increased 33 percent from 349 in 2012 to 463 in 2013. The average price of homes closed increased 5 percent from $376,000 in 2012 to $394,000 in 2013. |
• | Revenues from land and lot sales increased $8 million. Land and lot sales are a routine part of our land development business but they do not occur evenly from period to period. |
QUARTER ENDED | AMOUNT OF CHANGE | ||||||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | 2013 VS. 2012 | ||||||||
Unallocated corporate function expense | $ | (3 | ) | $ | (6 | ) | $ | 3 | |||
Unallocated share-based compensation | (7 | ) | (5 | ) | (2 | ) | |||||
Unallocated pension and postretirement costs | (10 | ) | (7 | ) | (3 | ) | |||||
Foreign exchange gains (losses) | (4 | ) | 6 | (10 | ) | ||||||
Elimination of intersegment profit in inventory and LIFO | (24 | ) | (12 | ) | (12 | ) | |||||
Other | (7 | ) | 30 | (37 | ) | ||||||
Operating income (loss) | (55 | ) | 6 | (61 | ) | ||||||
Interest income and other | 9 | 10 | (1 | ) | |||||||
Net contribution to earnings | $ | (46 | ) | $ | 16 | $ | (62 | ) |
• | $82 million during first quarter 2013 and |
• | $87 million during first quarter 2012. |
DOLLAR AMOUNTS IN MILLIONS | |||
First Quarter 2012: | |||
Income taxes on postretirement plan amendment discussed in Note 5 | $ | (18 | ) |
State income tax settlements | $ | 8 |
• | protect the interests of our shareholders and lenders and |
• | have access at all times to all major financial markets. |
• | viewing the capital structure of Forest Products separately from that of Real Estate given the very different nature of their assets and business activity and |
• | minimizing liquidity risk by managing timing of debt maturities. |
• | basic earnings capacity and |
• | liquidity characteristics of their respective assets. |
• | $61 million in 2013 and |
• | $60 million in 2012. |
• | make approximately $88 million of required contributions to our Canadian registered and nonregistered pension plans in 2013; |
• | make benefit payments of $19 million to our U.S. nonqualified pension plans; and |
• | make benefit payments of $37 million related to our U.S. and Canadian other postretirement plans. |
• | $42 million in 2013 and |
• | $57 million in 2012. |
YEAR-TO-DATE ENDED | |||||||
DOLLAR AMOUNTS IN MILLIONS | MARCH 2013 | MARCH 2012 | |||||
Timberlands | $ | 18 | $ | 12 | |||
Wood Products | 10 | 6 | |||||
Cellulose Fibers | 17 | 45 | |||||
Real Estate | 2 | 1 | |||||
Unallocated Items | 1 | — | |||||
Total | $ | 48 | $ | 64 |
• | $156 million in 2013 and |
• | $108 million in 2012. |
• | $156 million in 2013, and |
• | $2 million in 2012. |
• | $21 million in second quarter 2013 |
• | $163 million in third quarter 2013 and |
• | $69 million in fourth quarter 2013. |
• | had no borrowings outstanding under the credit facility and |
• | were in compliance with the credit facility covenants. |
• | $81 million in 2013 and |
• | $5 million in 2012. |
• | $93 million in 2013 and |
• | $81 million in 2012. |
12 | Statements regarding computation of ratios |
31 | Certification pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended |
32 | Certification pursuant to Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended, and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) |
100.INS | XBRL Instance Document |
100.SCH | XBRL Taxonomy Extension Schema Document |
100.CAL | XBRL Taxonomy Extension Calculation Linkbase Document |
100.DEF | XBRL Taxonomy Extension Definition Linkbase Document |
100.LAB | XBRL Taxonomy Extension Label Linkbase Document |
100.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
WEYERHAEUSER COMPANY | ||
Date: | April 30, 2013 | |
By: | /s/ JERALD W. RICHARDS | |
Jerald W. Richards | ||
Chief Accounting Officer |
QUARTER ENDED | |||||||
MARCH 2013 | MARCH 2012 | ||||||
Available earnings: | |||||||
Earnings before interest expense, amortization of debt expense and income taxes | $ | 276 | $ | 116 | |||
Add: interest portion of rental expense | 3 | 4 | |||||
Add: undistributed loss of equity affiliates and income attributable to noncontrolling interests in subsidiaries | 2 | 2 | |||||
Available earnings | $ | 281 | $ | 122 | |||
Fixed charges: | |||||||
Interest expense incurred: | |||||||
Weyerhaeuser Company and subsidiaries, excluding Weyerhaeuser Real Estate Company and other related subsidiaries | $ | 84 | $ | 86 | |||
Weyerhaeuser Real Estate Company and other related subsidiaries | 5 | 5 | |||||
Subtotal | 89 | 91 | |||||
Less: intercompany interest | (3 | ) | (1 | ) | |||
Total interest expense incurred | 86 | 90 | |||||
Amortization of debt expense | 1 | 2 | |||||
Interest portion of rental expense | 3 | 4 | |||||
Total fixed charges | $ | 90 | $ | 96 | |||
Ratio of earnings to fixed charges | 3.12 | 1.27 |
QUARTER ENDED | |||||||
MARCH 2013 | MARCH 2012 | ||||||
Available earnings: | |||||||
Earnings before interest expense, amortization of debt expense and income taxes | $ | 268 | $ | 111 | |||
Add: interest portion of rental expense | 3 | 3 | |||||
Add: undistributed loss of equity affiliates and attributable to noncontrolling interests in subsidiaries | 1 | 2 | |||||
Add: undistributed earnings before income taxes of Weyerhaeuser Real Estate Company and other related subsidiaries | — | 9 | |||||
Available earnings | $ | 272 | $ | 125 | |||
Fixed charges: | |||||||
Interest expense incurred | $ | 84 | $ | 86 | |||
Amortization of debt expense | 1 | 2 | |||||
Interest portion of rental expense | 3 | 3 | |||||
Total fixed charges | $ | 88 | $ | 91 | |||
Ratio of earnings to fixed charges | 3.09 | 1.37 |
1. | I have reviewed this quarterly report on Form 10-Q of Weyerhaeuser Company. |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report. |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | April 30, 2013 | |
/s/ DANIEL S. FULTON | ||
Daniel S. Fulton President and Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Weyerhaeuser Company. |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report. |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report. |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | April 30, 2013 | |
/s/ PATRICIA M. BEDIENT | ||
Patricia M. Bedient Executive Vice President and Chief Financial Officer |
/s/ DANIEL S. FULTON | ||
Daniel S. Fulton President and Chief Executive Officer | ||
Dated: | April 30, 2013 | |
/s/ PATRICIA M. BEDIENT | ||
Patricia M. Bedient Executive Vice President and Chief Financial Officer | ||
Dated: | April 30, 2013 |
PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS - Additional Information (Detail) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
|
|
Defined Benefit Plan Disclosure [Line Items] | ||
Recognized gain for plan amendment | $ 0 | $ (52) |
Canadian Registered and Non registered Pension Plans
|
||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to benefit plans during 2013 | 88 | |
U.S. Non-Qualified Pension Plans
|
||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to benefit plans during 2013 | 19 | |
U.S. Qualified Pension Plan
|
||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to benefit plans during 2013 | 0 | |
U.S. and Canadian Other Postretirement Plans
|
||
Defined Benefit Plan Disclosure [Line Items] | ||
Expected contribution to benefit plans during 2013 | $ 37 |
OTHER OPERATING INCOME, NET - Items Included in Other Operating Income, Net (Detail) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | |
---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
|
|
Component of Other Operating Cost and Expense [Line Items] | ||
Gain on postretirement plan amendment (Note 5) | $ 0 | $ (52) |
Gain on disposition of assets | (6) | (1) |
Foreign exchange losses (gains), net | 4 | (7) |
Land management income | (6) | (6) |
Other, net | (10) | 0 |
Total other operating income, net | $ (18) | $ (66) |
SHARE-BASED COMPENSATION - Weighted Average Assumptions Used in Estimating the Value of Performance Share Units Granted (Detail) (Performance share units, USD $)
|
3 Months Ended |
---|---|
Mar. 31, 2013
Rate
|
|
Performance share units
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance period | 1/1/2013 – 12/31/2014 |
Valuation date closing stock price | $ 30.48 |
Expected dividends | 2.23% |
Risk-free rate minimum | 0.09% |
Risk-free rate maximum | 0.46% |
Expected volatility minimum | 22.09% |
Expected volatility maximum | 29.57% |
INCOME TAXES (Tables)
|
3 Months Ended | ||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2013
|
|||||||||||||||||||||||||
Items Excluded from Effective Income Tax Rates | 2012 items include:
|
NET EARNINGS PER SHARE (Tables)
|
3 Months Ended | ||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2013
|
|||||||||||||||||||||||||||||||||||||
Potential Shares Not Included in the Computation of Diluted Earnings per Share | Potential Shares Not Included in the Computation of Diluted Earnings per Share
|
INCOME TAXES - Items Excluded from Effective Income Tax Rates (Detail) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2013
|
Mar. 31, 2012
Income taxes on postretirement plan amendment discussed in Note 5
|
Mar. 31, 2012
State income tax settlements
|
|
Income tax credit (charge) that is excluded from the company's effective income tax rate | $ 0 | $ (18) | $ 8 |
LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES (Detail) (USD $)
In Millions, unless otherwise specified |
Mar. 31, 2013
|
---|---|
Commitments and Contingencies Disclosure [Line Items] | |
Accrued estimated remediation costs | $ 31 |
Asset retirement obligations | $ 65 |
INVENTORIES (Detail) (Forest Products, USD $)
In Millions, unless otherwise specified |
Mar. 31, 2013
|
Dec. 31, 2012
|
---|---|---|
Other products | $ 92 | $ 96 |
Materials and supplies | 142 | 139 |
Subtotal | 707 | 643 |
Less LIFO reserve | (111) | (112) |
Total | 596 | 531 |
Logs and chips
|
||
Forest Products inventories | 107 | 72 |
Lumber, plywood, panels and engineered lumber
|
||
Forest Products inventories | 190 | 151 |
Pulp and paperboard
|
||
Forest Products inventories | $ 176 | $ 185 |
SHARE-BASED COMPENSATION - Weighted Average Assumptions Used to Remeasure the Value of Stock Appreciation Rights (Detail) (Stock appreciation rights, USD $)
|
3 Months Ended |
---|---|
Mar. 31, 2013
Rate
|
|
Stock appreciation rights
|
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 25.48% |
Expected dividends | 2.17% |
Expected term (in years) | 1 year 120 days |
Risk-free rate | 0.20% |
Weighted average fair value | $ 8.93 |
BASIS OF PRESENTATION
|
3 Months Ended | ||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2013
|
|||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||
BASIS OF PRESENTATION | BASIS OF PRESENTATION We are a corporation that has elected to be taxed as a real estate investment trust (REIT). We expect to derive most of our REIT income from investments in timberlands, including the sale of standing timber through pay-as-cut sales contracts. REIT income can be distributed to shareholders without first paying corporate level tax, substantially eliminating the double taxation on income. A significant portion of our timberland segment earnings receives this favorable tax treatment. We are, however, subject to corporate taxes on built-in-gains (the excess of fair market value over tax basis at January 1, 2010) on sales of real property (other than standing timber) held by the REIT during the first 10 years following the REIT conversion. We continue to be required to pay federal corporate income taxes on earnings of our Taxable REIT Subsidiary (TRS), which principally includes our manufacturing businesses, our real estate development business and the portion of our Timberlands segment income included in the TRS. Our consolidated financial statements provide an overall view of our results and financial condition. They include our accounts and the accounts of entities we control, including:
They do not include our intercompany transactions and accounts, which are eliminated, and noncontrolling interests are presented as a separate component of equity. We account for investments in and advances to unconsolidated equity affiliates using the equity method, with taxes provided on undistributed earnings. This means that we record earnings and accrue taxes in the period earnings are recognized by our unconsolidated equity affiliates. We report our financial condition in two groups:
Throughout these Notes to Consolidated Financial Statements, unless specified otherwise, references to “Weyerhaeuser,” “we” and “our” refer to the consolidated company, including both Forest Products and Real Estate. The accompanying unaudited Consolidated Financial Statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods presented. Except as otherwise disclosed in these Notes to Consolidated Financial Statements, such adjustments are of a normal, recurring nature. The Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission pertaining to interim financial statements; certain disclosures normally provided in accordance with accounting principles generally accepted in the United States have been omitted. These Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2012. Results of operations for interim periods should not be regarded as necessarily indicative of the results that may be expected for the full year. RECLASSIFICATIONS We have reclassified certain balances and results from the prior year to be consistent with our 2013 reporting. This makes year-to-year comparisons easier. Our reclassifications had no effect on net earnings or Weyerhaeuser shareholders’ interest. The reclassifications include where we report the elimination of intersegment profit on inventory and the LIFO reserve. Previously these company-level adjustments were recorded in the business segments and are now recorded in Unallocated Items. This provides a better understanding of business operating results. |