Segment Information

9 Months Ended

Sep. 30, 2021

Segment Reporting [Abstract]

Segment Information

NOTE 2. SEGMENT INFORMATION

Our operations are organized into three reportable segments: Timberlands, Wood Products and Real Estate. Management activities in the Timberlands segment include planting and harvesting trees and building and maintaining roads. The Timberlands segment also generates revenues from non-timber resources such as hunting leases, recreation permits and leases, mineral rights contracts, oil and gas royalties and carbon sequestration. The Wood Products segment manufactures and markets lumber and plywood. Activities in the Real Estate segment include our rural timberland-holdings sales program, master planned community development and a country club.

Our Timberlands segment supplies our Wood Products segment with a portion of its wood fiber needs. These intersegment revenues are based on prevailing market prices and typically represent a sizeable portion of the Timberlands segment’s total revenues. Our other segments generally do not generate intersegment revenues. These intercompany transactions are eliminated in consolidation.

The reportable segments follow the same accounting policies used for our Condensed Consolidated Financial Statements, with the exception of the valuation of inventories, which are reported using the average cost method for purposes of reporting segment results.

The following table presents our revenues by major product:

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2021			2020			2021			2020
Timberlands
Northern region
Sawlogs	$	88,244		$	72,815		$	251,198		$	144,860
Pulpwood		119			1,243			815			3,914
Stumpage		—			—			—			316
Other		205			855			740			1,450
Total Northern revenues		88,568			74,913			252,753			150,540
Southern region
Sawlogs		22,191			25,462			65,620			70,606
Pulpwood		13,843			13,413			33,167			35,486
Stumpage		2,275			770			3,310			2,416
Other		2,666			2,427			7,825			7,707
Total Southern revenues		40,975			42,072			109,922			116,215
Total Timberlands revenues		129,543			116,985			362,675			266,755
Wood Products
Lumber		141,255			185,558			679,417			400,290
Residuals and Panels		46,505			32,733			135,312			89,217
Total Wood Products revenues		187,760			218,291			814,729			489,507
Real Estate
Rural real estate		6,939			13,284			28,469			30,455
Development real estate		4,260			2,157			14,087			6,121
Other		2,298			2,710			7,252			5,649
Total Real Estate revenues		13,497			18,151			49,808			42,225
Total segment revenues		330,800			353,427			1,227,212			798,487
Intersegment Timberlands revenues1		(43,470	)		(40,381	)		(138,183	)		(95,006	)
Total consolidated revenues	$	287,330		$	313,046		$	1,089,029		$	703,481

1 Intersegment revenues represent logs sold by our Timberlands segment to our Wood Products segment.

Management primarily evaluates the performance of its segments and allocates resources to them based upon Adjusted EBITDDA. EBITDDA is calculated as net income before interest expense, income taxes, basis of real estate sold, depreciation, depletion and amortization. Adjusted EBITDDA further excludes certain specific items that are considered to hinder comparison of the performance of our businesses either year-on-year or with other businesses. Management uses Adjusted EBITDDA to compare the operating performance of our segments on a consistent basis and to evaluate the performance and effectiveness of each segment’s operating strategies. Our calculation of Adjusted EBITDDA may not be comparable to that reported by other companies.

The following table summarizes information for each of the company’s reportable segments and includes a reconciliation of Total Adjusted EBITDDA to income before income taxes. Corporate information is included to reconcile segment data to the Condensed Consolidated Financial Statements.

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2021			2020			2021			2020
Adjusted EBITDDA:
Timberlands	$	76,023		$	59,649		$	221,140		$	120,290
Wood Products		26,566			81,644			356,654			105,780
Real Estate		9,069			13,466			37,450			30,062
Corporate		(11,496	)		(15,361	)		(35,028	)		(34,567	)
Eliminations and adjustments		7,021			(4,012	)		(3,063	)		(3,235	)
Total Adjusted EBITDDA		107,183			135,386			577,153			218,330
Interest expense, net1		(8,641	)		(8,557	)		(20,414	)		(20,594	)
Depreciation, depletion and amortization		(21,131	)		(20,187	)		(56,156	)		(56,590	)
Basis of real estate sold		(6,697	)		(5,249	)		(22,733	)		(14,440	)
Net gain on insurance recoveries		4,394			—			4,394			—
Pension settlement charge		—			—			—			(42,988	)
Non-operating pension and other postretirement employee benefits		(3,271	)		(3,557	)		(9,956	)		(10,670	)
(Loss) gain on disposal of fixed assets		(1,139	)		11			(1,700	)		196
Income before income taxes	$	70,698		$	97,847		$	470,588		$	73,244
Depreciation, depletion and amortization:
Timberlands	$	11,893		$	13,821		$	33,792		$	37,978
Wood Products		8,879			5,983			21,261			17,411
Real Estate		162			149			477			465
Corporate		197			234			626			736
		21,131			20,187			56,156			56,590
Bond discounts and deferred loan fees1		403			407			1,209			1,219
Total depreciation, depletion and amortization	$	21,534		$	20,594		$	57,365		$	57,809
Basis of real estate sold:
Real Estate	$	6,703		$	5,257		$	22,751		$	14,973
Eliminations and adjustments		(6	)		(8	)		(18	)		(533	)
Total basis of real estate sold	$	6,697		$	5,249		$	22,733		$	14,440

1 Bond discounts and deferred loan fees are reported within interest expense, net on the Condensed Consolidated Statements of Operations.