Plum Creek Timber Company, Inc. (PCL) said Monday after the markets closed that its fourth quarter profit dropped 71% from last year, as revenue fell 44%. However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations, but its quarterly revenue fell short of analysts' forecast. At the same time, the company forecast full year 2010 earnings above analysts' current consensus estimate.
The Seattle, Washington-based timberland owner reported net income for the fourth quarter of $28 million or $0.17 per share, compared to $95 million or $0.57 per share for the year-ago quarter.
The latest quarter results include a $3 million $0.02 per share loss on the early extinguishment of debt, while the year-ago quarter results included an $11 million $0.07 per share gain from the early retirement of debt and $3 million or $0.02 per share of severance costs mainly associated with the company's downsizing of its lumber business.
On average, 13 analysts polled by Thomson Reuters expected the company to earn $0.16 per share for the fourth quarter. Analysts' estimates typically exclude special items.
In October, the company had said it expects fourth quarter earnings to be in the range of $0.12 to $0.17 per share.
"Our fourth quarter results came in much as we anticipated with stable to improving timber prices and seasonally better land sales activity," said Rick Holley, Plum Creek president and chief executive officer.
Revenue for the fourth quarter fell 44% to $258 million from $461 million in the same quarter last year. Ten analysts had a consensus revenue estimate of $262.64 million for the fourth quarter.
For the fourth quarter, the company's timber revenue fell 21% year-over-year to $131 million, while its real estate revenue dropped 69% to $67 million and its manufacturing segment revenue declined 40% to $245 million.
For the full year 2009, the company reported net income of $236 million or $1.44 per share, compared to $233 million or $1.37 per share for the full year 2008.
Revenue for the full year 2009 fell 20% to $1.29 billion from $1.61 billion the prior year.
Looking forward, the company aid it expects first quarter earnings from continuing operations to be $0.34 to $0.39 per share and full year 2010 earnings to be $1.25 to $1.45 per share.
Analysts currently expect the company to earn $0.14 per share for the first quarter and $1.21 per share for the full year 2010.
The company said it plans to harvest 15 million to 16 million tons of timber in 2010, about the same as 2009.
Real estate segment sales in 2010 are expected to be in the range of $350 million to $370 million, compared to $486 million in 2009.
The company expects the manufacturing segment to return to profitability this year.
"Business conditions stabilized in the second half of 2009, and we've seen some modest recovery from the extreme lows set earlier in 2009," said Plum Creek CEO Rick Holley. "While we believe recovery in our core businesses will continue in 2010, we believe the recovery will be slow by historic standards.
Plum Creek shares, which have trade in a range of $22.88 to $39.38 over the past year, closed, Monday's regular trading session at $36.75, up 58 cents or 1.60%. The stock is gaining 50 cents or 1.36% in after hours trading.
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