Weyerhaeuser Co.'s wood products unit incurred a $208 million operating loss in the fourth quarter, the company reported today. That's four times better than the $960 million loss the unit posted for the last three months of 2008 but more than double the $97 million loss it posted in last year's third quarter.
Federal Way, Wash.-based Weyerhaeuser said the operating loss deepened because of lower volumes and lower sales prices in nearly all product lines. It expects a lower operating loss in the first quarter because of improved operations rates and "anticipated sales realization improvements" for lumber and oriented strand board.
The most recent results include $85 million in charges for closures, restructuring, and asset impairments. It only had $5 million in such charges in the third quarter of 2009.
Company-wide, Weyerhaeuser posted a net loss of $175 million for the fourth quarter, a sharp improvement from its $1.2 billion loss in the year-earlier quarter. This came even though net sales from continuing operations dropped to $1.5 billion from $1.8 billion.
Likewise, Weyerhaeuser also lessened its net loss for all 2009 to $545 million, down from its $1.2 billion loss in 2008. Net sales from continuing operations for all 2008 slumped to $5.5 billion from $8.1 billion.
"The weak housing market continues to present challenges and affect our financial performance," president and CEO Dan Fulton said in a statement. "2009 has been another tough year and our financial results are disappointing. Despite difficult market conditions, we made significant progress this past year to position ourselves to rebuild revenues and earnings. We cut costs, reduced production to meet demand, focused on cash generation, and deferred harvest to preserve the long-term values of our timberlands. With an eye to the future, we made changes across all business lines to improve long-term competitiveness, implemented plans to grow with strategic customers and announced our decision to convert to a REIT [real estate investment trust]. As we enter 2010, markets continue to be challenging, but I'm confident we're positioned to deliver significantly improved operating performance."