Plum Creek Timber Company's manufacturing segment posted first-quarter operating profits of $4 million, unchanged from a year ago, despite a 13% increase in revenues to $76 million for the same period, the company reported Monday. Lumber and MDF prices matched those of a year ago while their sales volumes grew 3% and 10%, respectively. Plywood prices rose 4% and its sales spiked 21%.
Overall, the Seattle-based real estate investment trust saw profits drop 23% from a year ago to hit $29 million for the first quarter of 2012. The decrease comes despite an almost-equal increase in quarterly revenues to $337 million and is largely due to land sales values affecting the company’s real estate division. The company finished the quarter with $273 million in cash, up 7% from the same period last year.
"Our first quarter real estate sales ... were below our expectations," said president and CEO Rick Holley. "Performance in our timber and manufacturing segments was similar to the first quarter of 2011, and we remain on track to meet our financial goals for the year."
The Northern Resources segment posted operating profits of $6 million for the period, down from the $7 million profit recorded a year earlier and driven by flat or slightly raised timber prices in most regions. Still, a 13% increase in harvest volumes from a year ago to 124,000 tons helped manage higher logging and hauling costs. The segment saw sawlog prices dip 3%, or $2, per ton, while pulpwood prices increased 6%, or $2 per ton, thanks to strong Northeast hardwood pulpwood markets.
Operating profit for the Southern Resources segment was reported at $21 million for the quarter, up 10.5% from the same period last year, and due to a 14% increase in harvest volumes to total 400,000 tons. Of this increased volume, 350,000 tons are attributable to pulpwood, which saw prices mirror those of the year-ago period. The average sawlog price dipped 2% from a year ago, although smaller diameter prices remained steady and larger diameters experienced price decreases.