PORTLAND, Ore., April 12 /PRNewswire/ -- Willamette Industries, Inc.
(NYSE: WLL) reported first quarter 1999 earnings of $31.6 million, or $.28 per
diluted share as compared to $22.1 million or $.20 per diluted share for first
quarter 1998. First quarter earnings reflect a previously-announced change in
accounting for estimates relating to depreciation, resulting in increased
earnings of $.13 per share during the first quarter of 1999 (estimated to be
$0.52 for the full year 1999). The change extends the lives of machinery and
equipment due to advances in technology leading to longer productive lives and
to more closely compare to common industry practices.
Sales for the first quarter were $923.5 million, up 2.6% from the same
period a year earlier.
The star market-performer for the quarter was clearly the company's
building materials group, according to Duane McDougall, president and chief
executive officer of Willamette Industries. "Lumber, plywood and oriented
strand board saw healthy price increases over comparable 1998," McDougall
said. "In addition, our volumes were up significantly in these three product
lines, allowing us to take advantage of the excellent pricing."
On the paper side of the business, prices in both brown and white product
segments drifted downward during the quarter, reflective of worldwide market
softness in some lines and an increase in imports of white paper. "While price
increases were announced at the end of the first quarter, there was little
impact evident in our first quarter results," McDougall noted. "However, we
are very encouraged that announced price increases will start to show some
positive trending." Volumes were up 7.6% over first quarter 1998 in the
corrugated container business and were up 20.9% in the company's business
forms and cut sheet converting primarily as a result of capacity expansions
completed during 1998. "In April, we should see some of the benefits of price
increases, especially in the brown paper markets. White paper's recovery may
be a bit slower," McDougall said.
Willamette Industries is an integrated forest products company with 100
plants, located in the U.S., Ireland, France and Mexico. The company owns 1.7
million acres of forest land in the U.S. and manages it sustainably to produce
building materials, composite wood panels, fine paper, office paper products,
corrugated packaging and grocery bags.
Forward-looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are subject to risks and uncertainties and
actual results could differ materially from those projected. Such risks and
uncertainties include, but are not limited to, the effect of general economic
conditions; the level of new housing starts and remodeling activity; the
availability and terms of financing for construction; competitive factors,
including pricing pressures; the cost and availability of wood fiber; the
effect of natural disasters on the Company's timberlands; construction delays;
risk of non-performance by third parties; and the impact of environmental
regulations and the construction and other costs associated with complying
with such regulations. Please refer to Willamette Industries' Securities and
Exchange Commission filings for further information.
WILLAMETTE INDUSTRIES, INC.
FINANCIAL HIGHLIGHTS
Quarter Ended March 31 1999 1998
Basic Earnings Per Share $0.28 $0.20
Diluted Earnings Per Share $0.28 $0.20
Sales $923,453,000 $900,075,000
Earnings Before Taxes $47,155,000 $33,712,000
Net Earnings $31,594,000 $22,081,000
Average Shares Outstanding - Diluted 111,478,000 111,915,000
April 12, 1999
WILLAMETTE INDUSTRIES, INC. April 12, 1999
Quarterly Statistical Data
First Quarter 1999
First Quarter
1999 1998
PRODUCT SHIPMENTS
Lumber - 1" 197,012 173,353
Plywood - 3/8" 401,406 368,504
Oriented Strand Board- 3/8" 79,789 63,358
Particleboard - 3/4" 148,072 147,417
MDF - 3/4" 143,572* 128,776*
Corrugated - MSF 6,233,132 5,793,471
Grocery Bags - Tons 25,395 24,767
Business Forms - Tons 95,421 82,304
Cut-sheets - Tons 154,437 124,331
Brown Mills - Tons 435,325 447,936
Market Pulp - Tons 25,637 32,217
White Mills - Tons 357,168 276,947
* Includes 63,919 and 52,104 for International MDF for 1999 and 1998,
respectively.
SEGMENT INFORMATION ($ in Thousands)**
Sales:
Building Materials Group $332,807 $293,888
Brown Paper 332,697 337,250
White Paper 257,949 268,937
Operating Earnings: ***
Building Materials Group 49,758 13,549
Brown Paper 33,674 41,106
White Paper 9,190 18,312
Corporate (12,616) (11,456)
** See attached restatement of 1998 segment data by quarter
*** Operating Earnings for 1999 include the positive impact of a change in
estimate for depreciable lives of property, plant and equipment. The
increase in operating earnings is approximately as follows:
Building Materials: $5,700
Brown Paper 6,200
White Paper 9,100
SUPPLEMENTAL FINANCIAL ($ in Thousands)
Cost of Sales 778,295 775,823
Selling & Administration 65,152 62,741
Other Income (Expense) - Net (91) 2,773
Interest Expense - Net 32,760 30,572
Capitalized Interest 505 5,629
Income Taxes 15,561 11,631
Tax Rate 33.0% 34.5%
Depreciation & Amortization 63,605 73,600
Fee Stumpage 10,954 12,195
Deferred Taxes 10,900 5,816
Plant, Property &
Equipment (1) 65,741 93,770
Timber, Roads & Reforestation 5,186 5,494
(1) Includes capitalized interest
AVG. SHARES OUTSTANDING (000'S)
Basic 111,002 111,362
Diluted 111,478 111,915
Note: Certain reclassifications have been made to prior year's data to
conform with 1999 presentation.
WILLAMETTE INDUSTRIES, INC.
QUARTERLY SEGMENT DATA - RESTATED
1998
1ST QTR. 2ND QTR. 3RD QTR. 4TH QTR. YEAR
SALES:
Building
Materials $293,888 $320,614 $328,640 $311,607 $1,254,749
Brown Paper 337,250 357,614 350,162 333,984 $1,379,010
White Paper 268,937 268,162 277,992 251,432 $1,066,523
Total $900,075 $946,390 $956,794 $897,023 $3,700,282
OPERATING EARNINGS:
Building
Materials $13,549 $17,237 $34,216 $15,599 $80,601
Brown Paper 41,106 43,228 43,500 38,846 $166,680
White Paper 18,312 15,395 21,748 3,199 $58,654
Corporate (11,456) (10,417) (10,837) (10,481) ($43,191)
Total $61,511 $65,443 $88,627 $47,163 $262,744
NOTES:
(A) Certain reclassifications have been made to 1998 data shown in the
annual report to conform with 1999 presentation.
SOURCE Willamette Industries, Inc.
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CONTACT:
E. Jane Sinnema of Willamette Industries,
Inc., 503-721-8642
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