Fourth quarter operating income fell 13%, to $83 million, from the same period a year ago at Plum Creek Timber, the company reported on Jan. 30. Revenues dropped 12% to reach $315 million for the quarter ended Dec. 31.
For the year, the Seattle-based timber company posted a 7% decrease in operating income to $275 million, while total revenues fell 2% to $1.17 billion.
“Plum Creek posted another good year in 2011,” said president and CEO Rick Holley. “One again, our unmatched geographic diversity helped us manage the business for long-term value despite some challenging market conditions.”
For the quarter, Plum Creek’s manufacturing segment, under which it produces lumber, plywood, and medium-density fiberboard (MDF) reported a 14% increase in sales to $65 million. Cost of goods sold also increased for the segment, going up 15% to $60 million. Operating profits remained flat at $3 million and the company said lumber sales volumes remained similar to those of year’s fourth quarter, while plywood increased by 15% and MDF improved by 17%.
The segment posted a yearly operating income of $15 million, a $9 million decline from 2010, on revenues of $273 million, a 3% growth. The segment’s cost of goods sold also grew by 6% to reach $250 million for the year. Product price and sales volumes for the company’s product lines remained virtually the same, while higher raw material costs reduced segment profits.
Plum Creek’s timber segment reported quarterly sales of $151 million, an increase of 8% over the same period last year. For the year, the segment grew sales by less than 1% to $572 million.
The company’s real estate segment posted revenue of $301 million for the year, a $35 million decline from year prior. For the quarter, revenue fell 40% to $93 million.
As for 2012, the company said it plans so harvest about 17 million tons of timber and expects its manufacturing segment to remain steady.
“While we are not anticipating a significant rebound in the economy or housing in 2012, we do expect our cash flow to grow in 2012,” said Holley. “We are well positioned, and looking forward to continued growth in 2012 and beyond.”