Business at Plum Creek Timber Co.'s northern resources segment inched up just enough in the fourth quarter to swing to a $1 million profit from a $1 million operating loss in the year-earlier segment, the company reported today. Meanwhile, the southern resources segment boosted its operating profit roughly 65%, to $28 million from a year-earlier $17 million.
Conditions also improved in the manufacturing segment, which recorded a quarterly operating profit of $3 million, up from breakeven levels in 2009's final three months, even though sales volumes were essentially the same. Prices for lumber and plywood rose 8% and 6% from the year before, respectively, while MDF prices were relatively unchanged.
Those fresh results mean that the northern segment swung to a $13 million operating profit from a $3 million loss in 2009 even though revenues declined to $210 million from $212 million. Meanwhile, the southern resources segment increased its operating income 32% to $107 million on just an 8.6% revenue gain to $377 million. And the manufacturing segment reversed 2009's operating loss of $23 million to a $23 million operating profit on just an 8.2% rise in revenue to $265 million.
For the year, Seattle-based Plum Creek's timber segment recorded a 54% rise in operating profit from 2009 to total $42 million. Those gains helped offset losses in the real estate segment so that the overall company posted a $2 million drop in operating income for the year to $297 million. Net earnings for the year fell nearly 10% to reach $213 million, while earnings in the fourth quarter alone totaled $59 million, more than double 4Q09's $28 million, on a 38% rise in revenue to $356 million.
"We believe recovery in our businesses will continue in 2011," president and CEO Rick Holley said in a statement. "The supply chain remains tight and lumber prices have been firming over the past four months. We are starting to see this reflected in West Coast log prices, where prices began climbing in December and have continued to improve in January. However, sawlog markets throughout the nation are still below what we consider attractive levels. We are approaching 2011 conservatively and expect our harvest volume and mix will be similar to that of our 2010 harvest."