Weyerhaeuser Co.'s wood products division posted a $188 million operating loss during the fourth quarter of 2010, the company announced today. The number is an improvement from the $208 million operating loss the company incurred during fourth quarter 2009.
The Federal Way, Wash.-based company cited lower log costs and reduced selling, administrative and general expenses as the reason for the improvements. The improvement was partially offset by seasonally lower sales volume, however. The company expects improved operating rates, higher selling prices, and continued cost reductions to lower loss within the division during the first quarter of 2011.
The company's timberlands division posted an operating income of $56 million during the quarter, which is a vast improvement compared to the $13 million operating income the division posted in the fourth quarter of 2009.
Earlier this morning, Weyerhaeuser announced the sale of 82,000 acres of timberlands to the Hancock Timber Resource Group that will contribute $150 million in earnings to its first quarter of 2011.
Overall, the company swung to a $171 million operating profit during the quarter compared to a $175 million operating loss during the same period the year before. Sales also improved to $1.7 billion during the quarter from $1.5 billion during the fourth quarter of 2009.
Weyerhaeuser also posted an operating profit for the year of more than $1.2 billion, a massive improvement compared to the $545 million operating loss hit the company took in 2009. Net sales on the year also improved to more than $6.5 billion, which was a $1 billion improvement compared to the year earlier.
"Extremely challenging housing market conditions affected the financial performance of our Timberlands, Wood Products and Real Estate segments. We anticipate these market challenges will continue in 2011," said President and CEO Dan Fulton in a statement. "However, I expect better performance due to ongoing operational improvements, which will create cost efficiencies and enhance the relative competitiveness of our businesses."