Consolidating Financial Statements (Notes)

12 Months Ended

Dec. 31, 2012

CONSOLIDATING FINANCIAL STATEMENTS [Abstract]

Consolidating Financial Statements [Text Block]

22. CONSOLIDATING FINANCIAL STATEMENTS

The condensed consolidating financial information below follows the same accounting policies as described in the consolidated financial statements, except for the use of the equity method of accounting to reflect ownership interests in wholly-owned subsidiaries, which are eliminated upon consolidation, and the allocation of certain expenses of Rayonier Inc. incurred for the benefit of its subsidiaries.

In October 2007, TRS issued $300 million of 3.75% Senior Exchangeable Notes due 2012, and in August 2009 TRS issued $172.5 million of 4.50% Senior Exchangeable Notes due August 2015. The 2012 notes matured in October 2012 and the outstanding principal balance of $300 million was paid in cash. The notes for both transactions are (were) guaranteed by Rayonier Inc. as the Parent Guarantor and Rayonier Operating Company LLC ("ROC") as the Subsidiary Guarantor. In connection with these exchangeable notes, the Company provides the following condensed consolidating financial information in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.

In 2012, the Company has presented all information relating to the notes' non-guarantors in a single, combined column in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered. For comparability purposes, all prior year information has been updated to reflect the same presentation. The condensed consolidating financial information for the years ended December 31, 2011 and 2010 has been corrected to include comprehensive income. Management does not believe such correction is material to the previously issued financial statements.

	CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Year Ended December 31, 2012
	Rayonier Inc. (Parent Guarantor)			ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)			Non- guarantors			Consolidating Adjustments			Total Consolidated
SALES	$	—		$	—		$	—		$	1,571,000		$	—		$	1,571,000
Costs and Expenses
Cost of sales	—			—			—			1,104,805			—			1,104,805
Selling and general expenses	—			10,575			—			57,822			—			68,397
Other operating expense  (income), net	110			962			—			(14,175		)	—			(13,103		)
	110			11,537			—			1,148,452			—			1,160,099
Equity in income of New Zealand joint venture	—			—			—			550			—			550
OPERATING (LOSS) INCOME	(110		)	(11,537		)	—			423,098			—			411,451
Interest expense	(10,717		)	(941		)	(37,971		)	4,648			—			(44,981		)
Interest and miscellaneous income (expense), net	6,638			5,519			(3,334		)	(8,217		)	—			606
Equity in income from subsidiaries	282,874			289,486			232,871			—			(805,231		)	—
INCOME BEFORE INCOME TAXES	278,685			282,527			191,566			419,529			(805,231		)	367,076
Income tax benefit (expense)	—			347			15,076			(103,814		)	—			(88,391		)
NET INCOME	278,685			282,874			206,642			315,715			(805,231		)	278,685
OTHER COMPREHENSIVE INCOME (LOSS)	4,069			4,069			(453		)	4,116			(7,732		)	4,069
COMPREHENSIVE INCOME	$	282,754		$	286,943		$	206,189		$	319,831		$	(812,963	)	$	282,754

	CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Year Ended December 31, 2011
	Rayonier Inc. (Parent Guarantor)			ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)			Non- guarantors			Consolidating Adjustments			Total Consolidated
SALES	$	—		$	—		$	—		$	1,488,642		$	—		$	1,488,642
Costs and Expenses
Cost of sales	—			—			—			1,073,732			—			1,073,732
Selling and general expenses	—			10,710			—			55,831			—			66,541
Other operating expense  (income), net	—			117			—			(3,946		)	—			(3,829		)
	—			10,827			—			1,125,617			—			1,136,444
Equity in income of New Zealand joint venture	—			—			—			4,088			—			4,088
OPERATING (LOSS) INCOME	—			(10,827		)	—			367,113			—			356,286
Interest expense	621			(1,133		)	(49,555		)	(708		)	—			(50,775		)
Interest and miscellaneous income (expense), net	—			5,280			(4,508		)	79			—			851
Equity in income from subsidiaries	275,384			281,892			170,048			—			(727,324		)	—
INCOME BEFORE INCOME TAXES	276,005			275,212			115,985			366,484			(727,324		)	306,362
Income tax benefit (expense)	—			172			19,733			(50,262		)	—			(30,357		)
NET INCOME	276,005			275,384			135,718			316,222			(727,324		)	276,005
OTHER COMPREHENSIVE LOSS	(45,090		)	(45,090		)	(35,712		)	(34,403		)	115,205			(45,090		)
COMPREHENSIVE INCOME	$	230,915		$	230,294		$	100,006		$	281,819		$	(612,119	)	$	230,915

	CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Year Ended December 31, 2010
	Rayonier Inc. (Parent Guarantor)		ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)			Non- guarantors			Consolidating Adjustments			Total Consolidated
SALES	$	—	$	—		$	—		$	1,315,233		$	—		$	1,315,233
Costs and Expenses
Cost of sales	—		—			—			990,099			—			990,099
Selling and general expenses	—		10,122			—			56,980			—			67,102
Other operating expense  (income), net	—		385			—			(10,904		)	—			(10,519		)
	—		10,507			—			1,036,175			—			1,046,682
Equity in income of New Zealand joint venture	—		—			—			1,033			—			1,033
OPERATING (LOSS) INCOME BEFORE GAIN ON SALE OF A PORTION OF INTEREST IN NEW ZEALAND JOINT VENTURE	—		(10,507		)	—			280,091			—			269,584
Gain on sale of a portion of interest in New Zealand joint venture	—		—			—			12,367			—			12,367
OPERATING (LOSS) INCOME	—		(10,507		)	—			292,458			—			281,951
Interest expense	—		239			(50,313		)	(389		)	—			(50,463		)
Interest and miscellaneous income (expense), net	—		12,952			(4,309		)	(7,328		)	—			1,315
Equity in income from subsidiaries	217,586		221,578			137,471			—			(576,635		)	—
INCOME BEFORE INCOME TAXES	217,586		224,262			82,849			284,741			(576,635		)	232,803
Income tax (expense) benefit	—		(6,676		)	19,937			(28,478		)	—			(15,217		)
NET INCOME	217,586		217,586			102,786			256,263			(576,635		)	217,586
OTHER COMPREHENSIVE INCOME	11,384		11,384			4,056			8,967			(24,407		)	11,384
COMPREHENSIVE INCOME	$	228,970	$	228,970		$	106,842		$	265,230		$	(601,042	)	$	228,970

	CONDENSED CONSOLIDATING BALANCE SHEETS As of December 31, 2012
	Rayonier Inc. (Parent Guarantor)		ROC (Subsidiary Guarantor)		Rayonier TRS Holdings Inc. (Issuer)		Non- guarantors		Consolidating Adjustments			Total Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	252,888	$	3,966	$	19,358	$	4,384	$	—		$	280,596
Accounts receivable, less allowance for doubtful accounts	—		386		—		99,973		—			100,359
Inventory	—		—		—		127,966		—			127,966
Prepaid and other current assets	—		1,566		691		55,096		—			57,353
Total current assets	252,888		5,918		20,049		287,419		—			566,274
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION	—		—		—		1,573,309		—			1,573,309
NET PROPERTY, PLANT AND EQUIPMENT	—		2,321		—		704,717		—			707,038
INVESTMENT IN JOINT VENTURE	—		—		—		72,419		—			72,419
INVESTMENT IN SUBSIDIARIES	1,445,205		1,677,782		1,452,027		—		(4,575,014		)	—
INTERCOMPANY NOTES RECEIVABLE	213,863		14,000		19,831		—		(247,694		)	—
OTHER ASSETS	4,148		27,779		5,182		166,802		—			203,911
TOTAL ASSETS	$	1,916,104	$	1,727,800	$	1,497,089	$	2,804,666	$	(4,822,708	)	$	3,122,951
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	—	$	2,099	$	33	$	68,249	$	—		$	70,381
Current maturities of long-term debt	150,000		—		—		—		—			150,000
Accrued taxes	—		485		—		13,339		—			13,824
Accrued payroll and benefits	—		15,044		—		13,024		—			28,068
Accrued interest	3,100		379		3,197		1,280		—			7,956
Accrued customer incentives	—		—		—		10,849		—			10,849
Other current liabilities	—		2,925		—		15,715		—			18,640
Current liabilities for dispositions and discontinued operations	—		—		—		8,105		—			8,105
Total current liabilities	153,100		20,932		3,230		130,561		—			307,823
LONG-TERM DEBT	325,000		—		718,321		76,731		—			1,120,052
NON-CURRENT LIABILITIES FOR DISPOSITIONS AND DISCONTINUED OPERATIONS	—		—		—		73,590		—			73,590
PENSION AND OTHER POSTRETIREMENT BENEFITS	—		129,156		—		30,426		—			159,582
OTHER NON-CURRENT LIABILITIES	—		16,432		—		7,468		—			23,900
INTERCOMPANY PAYABLE	—		116,075		—		137,797		(253,872		)	—
TOTAL LIABILITIES	478,100		282,595		721,551		456,573		(253,872		)	1,684,947
TOTAL SHAREHOLDERS’ EQUITY	1,438,004		1,445,205		775,538		2,348,093		(4,568,836		)	1,438,004
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,916,104	$	1,727,800	$	1,497,089	$	2,804,666	$	(4,822,708	)	$	3,122,951

	CONDENSED CONSOLIDATING BALANCE SHEETS As of December 31, 2011
	Rayonier Inc. (Parent Guarantor)		ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)		Non- guarantors		Consolidating Adjustments			Total Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	—	$	8,977		$	59,976	$	9,650	$	—		$	78,603
Accounts receivable, less allowance for doubtful accounts	—		3			—		95,005		—			95,008
Inventory	—		—			—		121,998		—			121,998
Prepaid and other current assets	—		2,328			808		45,757		—			48,893
Total current assets	—		11,308			60,784		272,410		—			344,502
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION	—		—			—		1,503,711		—			1,503,711
NET PROPERTY, PLANT AND EQUIPMENT	—		2,551			—		459,001		—			461,552
INVESTMENT IN JOINT VENTURE	—		—			—		69,219		—			69,219
INVESTMENT IN SUBSIDIARIES	1,238,661		1,490,444			1,156,896		—		(3,886,001		)	—
INTERCOMPANY NOTES RECEIVABLE	204,420		—			19,073		—		(223,493		)	—
OTHER ASSETS	—		26,850			6,491		157,023		—			190,364
TOTAL ASSETS	$	1,443,081	$	1,531,153		$	1,243,244	$	2,461,364	$	(4,109,494	)	$	2,569,348
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	—	$	1,801		$	10	$	71,062	$	—		$	72,873
Current maturities of long-term debt	—		—			28,110		—		—			28,110
Accrued Taxes	—		(28		)	—		5,251		—			5,223
Accrued payroll and benefits	—		13,810			—		13,036		—			26,846
Accrued interest	8		246			5,442		1,348		—			7,044
Accrued customer incentives	—		—			—		10,369		—			10,369
Other current liabilities	—		1,887			—		15,968		—			17,855
Current liabilities for dispositions and discontinued operations	—		—			—		9,931		—			9,931
Total current liabilities	8		17,716			33,562		126,965		—			178,251
LONG-TERM DEBT	120,000		30,000			580,647		88,582		—			819,229
NON-CURRENT LIABILITIES FOR DISPOSITIONS AND DISCONTINUED OPERATIONS	—		—			—		80,893		—			80,893
PENSION AND OTHER POSTRETIREMENT BENEFITS	—		112,904			—		27,719		—			140,623
OTHER NON-CURRENT LIABILITIES	—		20,210			—		7,069		—			27,279
INTERCOMPANY PAYABLE	—		111,662			—		111,316		(222,978		)	—
TOTAL LIABILITIES	120,008		292,492			614,209		442,544		(222,978		)	1,246,275
TOTAL SHAREHOLDERS’ EQUITY	1,323,073		1,238,661			629,035		2,018,820		(3,886,516		)	1,323,073
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,443,081	$	1,531,153		$	1,243,244	$	2,461,364	$	(4,109,494	)	$	2,569,348

	CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2012
	Rayonier Inc. (Parent Guarantor)			ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)			Non- guarantors			Consolidating Adjustments			Total Consolidated
CASH PROVIDED BY OPERATING ACTIVITIES	$	90,456		$	138,149		$	41,000		$	423,784		$	(247,475	)	$	445,914
INVESTING ACTIVITIES
Capital expenditures	—			(285		)	—			(157,277		)	—			(157,562		)
Purchase of timberlands	—			—			—			(106,536		)	—			(106,536		)
Jesup mill cellulose specialties expansion	—			—			—			(201,359		)	—			(201,359		)
Change in restricted cash	—			—			—			(10,559		)	—			(10,559		)
Investment in Subsidiaries	—			—			(142,508		)	—			142,508			—
Other	—			(69		)	—			3,184			—			3,115
CASH USED FOR INVESTING ACTIVITIES	—			(354		)	(142,508		)	(472,547		)	142,508			(472,901		)
FINANCING ACTIVITIES
Issuance of debt	475,000			—			740,000			15,000			—			1,230,000
Repayment of debt	(120,000		)	(30,000		)	(638,110		)	(25,500		)	—			(813,610		)
Dividends paid	(206,583		)	—			—			—			—			(206,583		)
Proceeds from the issuance of common shares	25,495			—			—			—			—			25,495
Excess tax benefits on stock-based compensation	—			—			—			7,635			—			7,635
Debt issuance costs	(3,697		)	(1,219		)	—			(1,219		)	—			(6,135		)
Repurchase of common shares	(7,783		)	—			—			—			—			(7,783		)
Issuance of intercompany notes	—			(14,000		)	—			14,000			—			—
Intercompany distributions	—			(97,587		)	(41,000		)	33,620			104,967			—
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES	162,432			(142,806		)	60,890			43,536			104,967			229,019
EFFECT OF EXCHANGE RATE CHANGES ON CASH	—			—			—			(39		)	—			(39		)
CASH AND CASH EQUIVALENTS
Change in cash and cash equivalents	252,888			(5,011		)	(40,618		)	(5,266		)	—			201,993
Balance, beginning of year	—			8,977			59,976			9,650			—			78,603
Balance, end of year	$	252,888		$	3,966		$	19,358		$	4,384		$	—		$	280,596

	CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2011
	Rayonier Inc. (Parent Guarantor)			ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)			Non- guarantors			Consolidating Adjustments			Total Consolidated
CASH PROVIDED BY OPERATING ACTIVITIES	$	283,409		$	332,577		$	15,000		$	402,994		$	(601,710	)	$	432,270
INVESTING ACTIVITIES
Capital expenditures	—			(270		)	—			(144,252		)	—			(144,522		)
Purchase of timberlands	—			—			—			(320,899		)	—			(320,899		)
Jesup mill cellulose specialties expansion	—			—			—			(42,894		)	—			(42,894		)
Change in restricted cash	—			—			—			8,323			—			8,323
Investment in Subsidiaries	(19,259		)	(99,988		)	(35,828		)	—			155,075			—
Other	—			69			—			11,309			—			11,378
CASH USED FOR INVESTING ACTIVITIES	(19,259		)	(100,189		)	(35,828		)	(488,413		)	155,075			(488,614		)
FINANCING ACTIVITIES
Issuance of debt	120,000			105,000			—			235,000			—			460,000
Repayment of debt	—			(75,000		)	(168,057		)	(256,000		)	—			(499,057		)
Dividends paid	(185,272		)	—			—			—			—			(185,272		)
Proceeds from the issuance of common shares	13,451			—			—			—			—			13,451
Excess tax benefits on stock-based compensation	—			—			—			5,681			—			5,681
Debt issuance costs	—			(675		)	(676		)	(676		)	—			(2,027		)
Repurchase of common shares	(7,909		)	—			—			—			—			(7,909		)
Issuance of intercompany notes	(204,420		)	—			(18,961		)	223,381			—			—
Intercompany distributions	—			(282,495		)	(14,760		)	(149,380		)	446,635			—
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES	(264,150		)	(253,170		)	(202,454		)	58,006			446,635			(215,133		)
EFFECT OF EXCHANGE RATE CHANGES ON CASH	—			—			—			617			—			617
CASH AND CASH EQUIVALENTS
Change in cash and cash equivalents	—			(20,782		)	(223,282		)	(26,796		)	—			(270,860		)
Balance, beginning of year	—			29,759			283,258			36,446			—			349,463
Balance, end of year	$	—		$	8,977		$	59,976		$	9,650		$	—		$	78,603

	CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2010
	Rayonier Inc. (Parent Guarantor)			ROC (Subsidiary Guarantor)			Rayonier TRS Holdings Inc. (Issuer)			Non- guarantors			Consolidating Adjustments			Total Consolidated
CASH PROVIDED BY OPERATING ACTIVITIES	$	143,387		$	177,502		$	30,000		$	400,764		$	(256,263	)	$	495,390
INVESTING ACTIVITIES
Capital expenditures	—			(2,251		)	—			(136,198		)	—			(138,449		)
Purchase of timberlands	—			—			—			(5,360		)	—			(5,360		)
Change in restricted cash	—			—			—			(8,231		)	—			(8,231		)
Investment in Subsidiaries	—			—			145,975			—			(145,975		)	—
Other	—			—			—			9,384			—			9,384
CASH (USED FOR) PROVIDED BY INVESTING ACTIVITIES	—			(2,251		)	145,975			(140,405		)	(145,975		)	(142,656		)
FINANCING ACTIVITIES
Issuance of debt	—			—			75,000			82,000			—			157,000
Repayment of debt	—			(5,000		)	(4,650		)	(87,000		)	—			(96,650		)
Dividends paid	(163,673		)	—			—			—			—			(163,673		)
Proceeds from the issuance of common shares	26,314			—			—			—			—			26,314
Excess tax benefits on stock-based compensation	—			—			—			5,411			—			5,411
Debt issuance costs	—			—			(561		)	—			—			(561		)
Repurchase of common shares	(6,028		)	—			—			—			—			(6,028		)
Intercompany distributions	—			(143,387		)	(30,000		)	(228,851		)	402,238			—
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES	(143,387		)	(148,387		)	39,789			(228,440		)	402,238			(78,187		)
EFFECT OF EXCHANGE RATE CHANGES ON CASH	—			—			—			(48		)	—			(48		)
CASH AND CASH EQUIVALENTS
Change in cash and cash equivalents	—			26,864			215,764			31,871			—			274,499
Balance, beginning of year	—			2,895			67,494			4,575			—			74,964
Balance, end of year	$	—		$	29,759		$	283,258		$	36,446		$	—		$	349,463

In March 2012, Rayonier Inc. issued $325 million of 3.75% Senior Notes due 2022. At issuance, the notes were fully and unconditionally guaranteed by the following subsidiaries of Rayonier Inc.: ROC, Rayonier Louisiana Timberlands LLC, Rayonier TRS Holdings Inc. and substantially all domestic subsidiaries of TRS Holdings Inc. In October 2012, the guarantee on the notes was amended whereby all guarantors were released except ROC and Rayonier TRS Holdings Inc. As such, for comparability purposes, all prior year information has been updated to reflect ROC and Rayonier TRS Holdings Inc. as the note guarantors. In connection with these notes, the Company provides the following condensed consolidating financial information in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.

The condensed consolidating financial information for the years ended December 31, 2011 and 2010 has been corrected to include comprehensive income. Management does not believe such correction is material to the previously issued financial statements.

	CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Year Ended December 31, 2012
	Rayonier Inc.(Parent Issuer)			Subsidiary Guarantors			Non- guarantors			Consolidating Adjustments			Total Consolidated
SALES	$	—		$	—		$	1,571,000		$	—		$	1,571,000
Costs and Expenses
Cost of sales	—			—			1,104,805			—			1,104,805
Selling and general expenses	—			10,575			57,822			—			68,397
Other operating expense (income), net	110			962			(14,175		)	—			(13,103		)
	110			11,537			1,148,452			—			1,160,099
Equity in income of New Zealand joint venture	—			—			550			—			550
OPERATING (LOSS) INCOME	(110		)	(11,537		)	423,098			—			411,451
Interest expense	(10,717		)	(38,912		)	4,648			—			(44,981		)
Interest and miscellaneous income (expense), net	6,638			2,185			(8,217		)	—			606
Equity in income from subsidiaries	282,874			315,715			—			(598,589		)	—
INCOME BEFORE INCOME TAXES	278,685			267,451			419,529			(598,589		)	367,076
Income tax benefit (expense)	—			15,423			(103,814		)	—			(88,391		)
NET INCOME	278,685			282,874			315,715			(598,589		)	278,685
OTHER COMPREHENSIVE INCOME	4,069			4,069			4,116			(8,185		)	4,069
COMPREHENSIVE INCOME	$	282,754		$	286,943		$	319,831		$	(606,774	)	$	282,754

	CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Year Ended December 31, 2011
	Rayonier Inc.(Parent Issuer)			Subsidiary Guarantors			Non- guarantors			Consolidating Adjustments			Total Consolidated
SALES	$	—		$	—		$	1,488,642		$	—		$	1,488,642
Costs and Expenses
Cost of sales	—			—			1,073,732			—			1,073,732
Selling and general expenses	—			10,710			55,831			—			66,541
Other operating expense (income), net	—			117			(3,946		)	—			(3,829		)
	—			10,827			1,125,617			—			1,136,444
Equity in income of New Zealand joint venture	—			—			4,088			—			4,088
OPERATING (LOSS) INCOME	—			(10,827		)	367,113			—			356,286
Interest expense	621			(50,688		)	(708		)	—			(50,775		)
Interest and miscellaneous income, net	—			772			79			—			851
Equity in income from subsidiaries	275,384			316,222			—			(591,606		)	—
INCOME BEFORE INCOME TAXES	276,005			255,479			366,484			(591,606		)	306,362
Income tax benefit (expense)	—			19,905			(50,262		)	—			(30,357		)
NET INCOME	276,005			275,384			316,222			(591,606		)	276,005
OTHER COMPREHENSIVE (LOSS)	(45,090		)	(45,090		)	(34,403		)	79,493			(45,090		)
COMPREHENSIVE INCOME	$	230,915		$	230,294		$	281,819		$	(512,113	)	$	230,915

	CONDENSED CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Year Ended December 31, 2010
	Rayonier Inc.(Parent Issuer)		Subsidiary Guarantors			Non- guarantors			Consolidating Adjustments			Total Consolidated
SALES	$	—	$	—		$	1,315,233		$	—		$	1,315,233
Costs and Expenses
Cost of sales	—		—			990,099			—			990,099
Selling and general expenses	—		10,122			56,980			—			67,102
Other operating expense (income), net	—		385			(10,904		)	—			(10,519		)
	—		10,507			1,036,175			—			1,046,682
Equity in income of New Zealand joint venture	—		—			1,033			—			1,033
OPERATING (LOSS) INCOME BEFORE GAIN ON SALE OF A PORTION OF INTEREST IN NEW ZEALAND JOINT VENTURE	—		(10,507		)	280,091			—			269,584
Gain on sale of a portion of interest in New Zealand joint venture	—		—			12,367			—			12,367
OPERATING (LOSS) INCOME	—		(10,507		)	292,458			—			281,951
Interest expense	—		(50,074		)	(389		)	—			(50,463		)
Interest and miscellaneous income (expense), net	—		8,643			(7,328		)	—			1,315
Equity in income from subsidiaries	217,586		256,263			—			(473,849		)	—
INCOME BEFORE INCOME TAXES	217,586		204,325			284,741			(473,849		)	232,803
Income tax benefit (expense)	—		13,261			(28,478		)	—			(15,217		)
NET INCOME	217,586		217,586			256,263			(473,849		)	217,586
OTHER COMPREHENSIVE INCOME	11,384		11,384			8,967			(20,351		)	11,384
COMPREHENSIVE INCOME	$	228,970	$	228,970		$	265,230		$	(494,200	)	$	228,970

	CONDENSED CONSOLIDATING BALANCE SHEETS As of December 31, 2012
	Rayonier Inc.(Parent Issuer)		Subsidiary Guarantors		Non- guarantors		Consolidating Adjustments			Total Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	252,888	$	23,324	$	4,384	$	—		$	280,596
Accounts receivable, less allowance for doubtful accounts	—		386		99,973		—			100,359
Inventory	—		—		127,966		—			127,966
Prepaid and other current assets	—		2,257		55,096		—			57,353
Total current assets	252,888		25,967		287,419		—			566,274
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION	—		—		1,573,309		—			1,573,309
NET PROPERTY, PLANT AND EQUIPMENT	—		2,321		704,717		—			707,038
INVESTMENT IN JOINT VENTURE	—		—		72,419		—			72,419
INVESTMENT IN SUBSIDIARIES	1,445,205		2,354,270		—		(3,799,475		)	—
INTERCOMPANY NOTES RECEIVABLE	213,863		33,831		—		(247,694		)	—
OTHER ASSETS	4,148		32,961		166,802		—			203,911
TOTAL ASSETS	$	1,916,104	$	2,449,350	$	2,804,666	$	(4,047,169	)	$	3,122,951
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	—	$	2,132	$	68,249	$	—		$	70,381
Current maturities of long-term debt	150,000		—		—		—			150,000
Accrued taxes	—		485		13,339		—			13,824
Accrued payroll and benefits	—		15,044		13,024		—			28,068
Accrued interest	3,100		3,576		1,280		—			7,956
Accrued customer incentives	—		—		10,849		—			10,849
Other current liabilities	—		2,925		15,715		—			18,640
Current liabilities for dispositions and discontinued operations	—		—		8,105		—			8,105
Total current liabilities	153,100		24,162		130,561		—			307,823
LONG-TERM DEBT	325,000		718,321		76,731		—			1,120,052
NON-CURRENT LIABILITIES FOR DISPOSITIONS AND DISCONTINUED OPERATIONS	—		—		73,590		—			73,590
PENSION AND OTHER POSTRETIREMENT BENEFITS	—		129,156		30,426		—			159,582
OTHER NON-CURRENT LIABILITIES	—		16,432		7,468		—			23,900
INTERCOMPANY PAYABLE	—		116,074		137,797		(253,871		)	—
TOTAL LIABILITIES	478,100		1,004,145		456,573		(253,871		)	1,684,947
TOTAL SHAREHOLDERS’ EQUITY	1,438,004		1,445,205		2,348,093		(3,793,298		)	1,438,004
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,916,104	$	2,449,350	$	2,804,666	$	(4,047,169	)	$	3,122,951

	CONDENSED CONSOLIDATING BALANCE SHEETS As of December 31, 2011
	Rayonier Inc.(Parent Issuer)		Subsidiary Guarantors			Non- guarantors		Consolidating Adjustments			Total Consolidated
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	—	$	68,953		$	9,650	$	—		$	78,603
Accounts receivable, less allowance for doubtful accounts	—		3			95,005		—			95,008
Inventory	—		—			121,998		—			121,998
Prepaid and other current assets	—		3,136			45,757		—			48,893
Total current assets	—		72,092			272,410		—			344,502
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION	—		—			1,503,711		—			1,503,711
NET PROPERTY, PLANT AND EQUIPMENT	—		2,551			459,001		—			461,552
INVESTMENT IN JOINT VENTURE	—		—			69,219		—			69,219
INVESTMENT IN SUBSIDIARIES	1,238,661		2,018,306			—		(3,256,967		)	—
INTERCOMPANY NOTES RECEIVABLE	204,420		19,072			—		(223,492		)	—
OTHER ASSETS	—		33,341			157,023		—			190,364
TOTAL ASSETS	$	1,443,081	$	2,145,362		$	2,461,364	$	(3,480,459	)	$	2,569,348
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	—	$	1,811		$	71,062	$	—		$	72,873
Current maturities of long-term debt	—		28,110			—		—			28,110
Accrued taxes	—		(28		)	5,251		—			5,223
Accrued payroll and benefits	—		13,810			13,036		—			26,846
Accrued interest	8		5,688			1,348		—			7,044
Accrued customer incentives	—		—			10,369		—			10,369
Other current liabilities	—		1,887			15,968		—			17,855
Current liabilities for dispositions and discontinued operations	—		—			9,931		—			9,931
Total current liabilities	8		51,278			126,965		—			178,251
LONG-TERM DEBT	120,000		610,647			88,582		—			819,229
NON-CURRENT LIABILITIES FOR DISPOSITIONS AND DISCONTINUED OPERATIONS	—		—			80,893		—			80,893
PENSION AND OTHER POSTRETIREMENT BENEFITS	—		112,904			27,719		—			140,623
OTHER NON-CURRENT LIABILITIES	—		20,210			7,069		—			27,279
INTERCOMPANY PAYABLE	—		111,662			111,316		(222,978		)	—
TOTAL LIABILITIES	120,008		906,701			442,544		(222,978		)	1,246,275
TOTAL SHAREHOLDERS’ EQUITY	1,323,073		1,238,661			2,018,820		(3,257,481		)	1,323,073
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,443,081	$	2,145,362		$	2,461,364	$	(3,480,459	)	$	2,569,348

	CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2012
	Rayonier Inc.(Parent Issuer)			Subsidiary Guarantors			Non- guarantors			Consolidating Adjustments			Total Consolidated
CASH PROVIDED BY OPERATING ACTIVITIES	$	90,456		$	138,149		$	423,784		$	(206,475	)	$	445,914
INVESTING ACTIVITIES
Capital expenditures	—			(285		)	(157,277		)	—			(157,562		)
Purchase of timberlands	—			—			(106,536		)	—			(106,536		)
Jesup mill cellulose specialties expansion	—			—			(201,359		)	—			(201,359		)
Change in restricted cash	—			—			(10,559		)	—			(10,559		)
Investment in Subsidiaries	—			(142,508		)	—			142,508			—
Other	—			(69		)	3,184			—			3,115
CASH USED FOR INVESTING ACTIVITIES	—			(142,862		)	(472,547		)	142,508			(472,901		)
FINANCING ACTIVITIES
Issuance of debt	475,000			740,000			15,000			—			1,230,000
Repayment of debt	(120,000		)	(668,110		)	(25,500		)	—			(813,610		)
Dividends paid	(206,583		)	—			—			—			(206,583		)
Proceeds from the issuance of common shares	25,495			—			—			—			25,495
Excess tax benefits on stock-based compensation	—			—			7,635			—			7,635
Debt issuance costs	(3,697		)	(1,219		)	(1,219		)	—			(6,135		)
Repurchase of common shares	(7,783		)	—			—			—			(7,783		)
Issuance of intercompany notes	—			(14,000		)	14,000			—			—
Intercompany distributions	—			(97,587		)	33,620			63,967			—
CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES	162,432			(40,916		)	43,536			63,967			229,019
EFFECT OF EXCHANGE RATE CHANGES ON CASH	—			—			(39		)	—			(39		)
CASH AND CASH EQUIVALENTS
Change in cash and cash equivalents	252,888			(45,629		)	(5,266		)	—			201,993
Balance, beginning of year	—			68,953			9,650			—			78,603
Balance, end of year	$	252,888		$	23,324		$	4,384		$	—		$	280,596

	CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2011
	Rayonier Inc.(Parent Issuer)			Subsidiary Guarantors			Non- guarantors			Consolidating Adjustments			Total Consolidated
CASH PROVIDED BY OPERATING ACTIVITIES	$	283,409		$	332,817		$	402,994		$	(586,950	)	$	432,270
INVESTING ACTIVITIES
Capital expenditures	—			(270		)	(144,252		)	—			(144,522		)
Purchase of timberlands	—			—			(320,899		)	—			(320,899		)
Jesup mill cellulose specialties expansion	—			—			(42,894		)	—			(42,894		)
Change in restricted cash	—			—			8,323			—			8,323
Investment in Subsidiaries	(19,259		)	(135,816		)	—			155,075			—
Other	—			69			11,309			—			11,378
CASH USED FOR INVESTING ACTIVITIES	(19,259		)	(136,017		)	(488,413		)	155,075			(488,614		)
FINANCING ACTIVITIES
Issuance of debt	120,000			105,000			235,000			—			460,000
Repayment of debt	—			(243,057		)	(256,000		)	—			(499,057		)
Dividends paid	(185,272		)	—			—			—			(185,272		)
Proceeds from the issuance of common shares	13,451			—			—			—			13,451
Excess tax benefits on stock-based compensation	—			—			5,681			—			5,681
Debt issuance costs	—			(1,351		)	(676		)	—			(2,027		)
Repurchase of common shares	(7,909		)	—			—			—			(7,909		)
Issuance of intercompany notes	(204,420		)	(18,961		)	223,381			—			—
Intercompany distributions	—			(282,495		)	(149,380		)	431,875			—
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES	(264,150		)	(440,864		)	58,006			431,875			(215,133		)
EFFECT OF EXCHANGE RATE CHANGES ON CASH	—			—			617			—			617
CASH AND CASH EQUIVALENTS
Change in cash and cash equivalents	—			(244,064		)	(26,796		)	—			(270,860		)
Balance, beginning of year	—			313,017			36,446			—			349,463
Balance, end of year	$	—		$	68,953		$	9,650		$	—		$	78,603

	CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Year Ended December 31, 2010
	Rayonier Inc.(Parent Issuer)			Subsidiary Guarantors			Non- guarantors			Consolidating Adjustments			Total Consolidated
CASH PROVIDED BY OPERATING ACTIVITIES	$	143,387		$	177,502		$	400,764		$	(226,263	)	$	495,390
INVESTING ACTIVITIES
Capital expenditures	—			(2,251		)	(136,198		)	—			(138,449		)
Purchase of timberlands	—			—			(5,360		)	—			(5,360		)
Change in restricted cash	—			—			(8,231		)	—			(8,231		)
Investment in Subsidiaries	—			145,975			—			(145,975		)	—
Other	—			—			9,384			—			9,384
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES	—			143,724			(140,405		)	(145,975		)	(142,656		)
FINANCING ACTIVITIES
Issuance of debt	—			75,000			82,000			—			157,000
Repayment of debt	—			(9,650		)	(87,000		)	—			(96,650		)
Dividends paid	(163,673		)	—			—			—			(163,673		)
Proceeds from the issuance of common shares	26,314			—			—			—			26,314
Excess tax benefits on stock-based compensation	—			—			5,411			—			5,411
Debt issuance costs	—			(561		)	—			—			(561		)
Repurchase of common shares	(6,028		)	—			—			—			(6,028		)
Intercompany distributions	—			(143,387		)	(228,851		)	372,238			—
CASH USED FOR FINANCING ACTIVITIES	(143,387		)	(78,598		)	(228,440		)	372,238			(78,187		)
EFFECT OF EXCHANGE RATE CHANGES ON CASH	—			—			(48		)	—			(48		)
CASH AND CASH EQUIVALENTS
Change in cash and cash equivalents	—			242,628			31,871			—			274,499
Balance, beginning of year	—			70,389			4,575			—			74,964
Balance, end of year	$	—		$	313,017		$	36,446		$	—		$	349,463