Rayonier Delivers Strong Fourth Quarter and Full Year Results, Sets Sights on 2025
The strong performance was driven primarily by significantly improved results in the Real Estate segment, which delivered adjusted EBITDA of $63 million, up $10 million from the prior year period. The increased contribution from the real estate business was bolstered by an extraordinarily strong weighted average price per acre of roughly $7,200, excluding improved development and large dispositions, demonstrating the company's ability to optimize the value of its portfolio by generating significant HBU premiums above timberland value.
In addition to the Real Estate segment, Rayonier's New Zealand Timber segment also reported a strong performance in the fourth quarter, with adjusted EBITDA increasing $8 million versus the prior year period. The increase was driven by favorable foreign exchange impacts, higher volume, higher net stumpage realizations, and lower costs.
The company's Southern Timber segment generated modestly higher adjusted EBITDA of $35 million in the fourth quarter, up from the prior year period. However, this was largely offset by a 3% decline in harvest volumes and 15% lower weighted average net stumpage realizations, driven in large part by the impact of salvage volume on the market following Hurricane Helene.
Rayonier's Pacific Northwest Timber segment reported adjusted EBITDA of $6 million for the fourth quarter, flat versus the prior year period. This was largely due to a 3% decrease in harvest volumes and a 9% decrease in average delivered log prices, which were partially offset by lower costs and higher non-timber income.
The company also successfully closed on $495 million of large dispositions totaling approximately 200,000 acres during the fourth quarter. These transactions have allowed Rayonier to reduce leverage and return capital to shareholders while also generating accretion to CAD per share. To date, the company has now closed on roughly $737 million of dispositions, approximately 74% of its original $1 billion target.
Looking ahead to 2025, Rayonier is providing full year adjusted EBITDA guidance of $270 million to $300 million. This reflects a slight decline at the midpoint relative to 2024 adjusted EBITDA, which is due to the dispositions completed in the fourth quarter and modestly lower expectations in the Real Estate segment following the extraordinarily strong results realized last year.
Mark McHugh, President and CEO of Rayonier, stated that the company was pleased to finish 2024 with better-than-expected financial results, demonstrating its resilience and nimble execution amid persistent market headwinds. The company's ability to adapt and deliver strong performance despite challenging conditions is a testament to its commitment to delivering value for shareholders.
Overall, Rayonier's strong fourth quarter and full year results demonstrate the company's continued focus on optimizing its portfolio and generating significant returns for shareholders. With a solid foundation in place, the company is well-positioned to execute on its plans and deliver future growth and success. >
