<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
(x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 1-6780
RAYONIER INC.
Incorporated in the State of North Carolina
I.R.S. Employer Identification Number l3-2607329
50 North Laura Street, Jacksonville, FL 32202
(Principal Executive Office)
Telephone Number: (904) 357-9100
Indicate by check mark whether the registrant (l) has filed all reports required
to be filed by Section l3 or l5(d) of the Securities Exchange Act of l934 during
the preceding l2 months and (2) has been subject to such filing requirements for
the past 90 days.
YES (X) NO ( )
As of July 31, 2000, there were outstanding 27,207,040 Common Shares of the
Registrant.
<PAGE> 2
RAYONIER INC.
FORM 10-Q
JUNE 30, 2000
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I. FINANCIAL INFORMATION
Item l. Financial Statements
Statements of Consolidated Income for the
Three Months and Six Months Ended June 30, 2000 and 1999 1
Consolidated Balance Sheets as of June 30, 2000
and December 3l, 1999 2
Statements of Consolidated Cash Flows for the
Six Months Ended June 30, 2000 and 1999 3
Notes to Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 5
Item 3. Selected Operating Data 9
Selected Supplemental Financial Data 10
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
Signature 11
Exhibit Index 12
</TABLE>
i
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following unaudited financial statements reflect, in the opinion of Rayonier
Inc. and subsidiaries (Rayonier or the Company), all adjustments (which include
only normal recurring adjustments) necessary for a fair presentation of the
results of operations, the financial position and the cash flows for the periods
presented. For a full description of accounting policies, please refer to the
Notes to Consolidated Financial Statements in the l999 Annual Report on Form
l0-K.
RAYONIER INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME
(UNAUDITED)
(THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
SALES $ 283,552 $ 258,023 $ 572,707 $ 484,419
------------ ------------ ------------ ------------
Costs and expenses
Cost of sales 225,922 215,198 452,062 403,879
Selling and general expenses 9,416 9,785 19,352 19,250
Other operating expense (income), net 948 (711) 2,521 (1,905)
------------ ------------ ------------ ------------
236,286 224,272 473,935 421,224
------------ ------------ ------------ ------------
OPERATING INCOME 47,266 33,751 98,772 63,195
Interest expense (21,612) (7,683) (44,402) (15,387)
Miscellaneous (expense) income, net (790) (233) (623) 481
Gains from sale of assets - - 23,147 -
------------ ------------ ------------ ------------
Income before income taxes 24,864 25,835 76,894 48,289
Income tax expense (7,433) (8,758) (23,990) (16,082)
------------ ------------ ------------ ------------
NET INCOME $ 17,431 $ 17,077 $ 52,904 $ 32,207
============ ============ ============ ============
EARNINGS PER COMMON SHARE
Basic $ 0.64 $ 0.62 $ 1.93 $ 1.16
============ ============ ============ ============
Diluted $ 0.63 $ 0.60 $ 1.90 $ 1.14
============ ============ ============ ============
</TABLE>
1
<PAGE> 4
RAYONIER INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(THOUSANDS OF DOLLARS)
ASSETS
<TABLE>
<CAPTION>
June 30, December 31,
2000 1999
------------- --------------
<S> <C> <C>
CURRENT ASSETS
Cash and short-term investments $ 14,416 $ 12,265
Accounts receivable, less allowance for doubtful
accounts of $4,831 and $4,859 112,957 103,535
Inventories
Finished goods 49,786 52,984
Work in process 9,832 12,478
Raw materials 12,064 17,947
Manufacturing and maintenance supplies 21,688 21,670
------------- --------------
Total inventories 93,370 105,079
Timber purchase agreements 36,987 30,477
Other current assets 13,416 11,107
Deferred income taxes 8,073 9,143
------------- --------------
Total current assets 279,219 271,606
------------- --------------
OTHER ASSETS 65,746 77,094
TIMBER PURCHASE AGREEMENTS 10,363 7,816
TIMBER, FORESTLANDS AND LOGGING ROADS,
NET OF DEPLETION AND AMORTIZATION 1,217,666 1,247,547
PROPERTY, PLANT AND EQUIPMENT, NET
Land, buildings, machinery and equipment 1,351,427 1,333,789
Less accumulated depreciation 695,595 657,625
------------- --------------
655,832 676,164
------------- --------------
TOTAL ASSETS $ 2,228,826 $ 2,280,227
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 74,213 $ 74,035
Bank loans and current maturities 2,734 3,248
Accrued taxes 26,133 15,148
Accrued payroll and benefits 22,803 22,405
Accrued interest 11,989 11,160
Other current liabilities 38,114 48,895
Current reserves for dispositions and discontinued operations 19,573 18,980
------------- --------------
Total current liabilities 195,559 193,871
DEFERRED INCOME TAXES 129,029 123,458
LONG-TERM DEBT 1,050,245 1,132,930
NON-CURRENT RESERVES FOR DISPOSITIONS
AND DISCONTINUED OPERATIONS 144,038 149,551
OTHER NON-CURRENT LIABILITIES 31,430 27,517
SHAREHOLDERS' EQUITY
Common shares, 60,000,000 shares authorized,
27,231,040 and 27,407,094 shares issued and outstanding 52,928 60,518
Retained earnings 625,597 592,382
------------- --------------
678,525 652,900
------------- --------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 2,228,826 $ 2,280,227
============= =============
</TABLE>
2
<PAGE> 5
RAYONIER INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
(UNAUDITED)
(THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-------------------------------
2000 1999
--------- ---------
<S> <C> <C>
OPERATING ACTIVITIES
Net income $ 52,904 $ 32,207
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation, depletion and amortization 73,388 50,124
Deferred income taxes 4,839 5,663
Gains from sale of assets (23,147) -
Non-cash cost of land sales 1,215 2,878
Increase in other non-current liabilities 3,913 1,584
Change in accounts receivable, inventories
and accounts payable 1,250 5,730
Increase in current timber purchase agreements (6,510) (2,138)
Increase in other current assets (2,309) (348)
Increase in accrued liabilities 1,431 7,866
--------- ---------
CASH PROVIDED BY OPERATING ACTIVITIES 106,974 103,566
--------- ---------
INVESTING ACTIVITIES
Capital expenditures (47,420) (43,453)
Sales, retirements and reclassifications of property, plant and equipment, net (2,011) (311)
Expenditures for dispositions and discontinued operations,
net of tax benefits of $1,802 and $2,773 (3,118) (4,798)
Proceeds from sale of assets, net of cash costs 49,403 -
Change in timber purchase agreements and other assets 8,801 1,500
--------- ---------
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES 5,655 (47,062)
--------- ---------
FINANCING ACTIVITIES
Issuance of debt 55,549 99,861
Repayments of debt (138,748) (137,436)
Dividends paid (19,652) (17,244)
Repurchase of common shares (9,350) (5,600)
Issuance of common shares 1,723 2,997
--------- ---------
CASH USED FOR FINANCING ACTIVITIES (110,478) (57,422)
--------- ---------
CASH AND SHORT-TERM INVESTMENTS
Increase (decrease) in cash and short-term investments 2,151 (918)
Balance at beginning of period 12,265 6,635
--------- ---------
Balance at end of period $ 14,416 $ 5,717
========= =========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest $ 43,574 $ 14,132
========= =========
Income taxes $ 11,208 $ 4,622
========= =========
</TABLE>
3
<PAGE> 6
RAYONIER INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA)
1. EARNINGS PER COMMON SHARE
The following table provides details of the calculation of basic and
diluted earnings per common share in accordance with Statement of Financial
Accounting Standards (SFAS) No. 128, "Earnings Per Share," for the three
months and six months ended June 30, 2000 and 1999.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net income $ 17,431 $ 17,077 $ 52,904 $ 32,207
=========== =========== =========== ===========
Shares used for determining basic earnings
per common share 27,324,476 27,785,931 27,357,419 27,796,186
Dilutive effect of
Stock options 192,293 307,947 193,325 269,111
Contingent shares 360,000 240,000 360,000 240,000
----------- ----------- ----------- -----------
Shares used for determining diluted earnings
per common share 27,876,769 28,333,878 27,910,744 28,305,297
=========== =========== =========== ===========
Basic earnings per common share $ 0.64 $ 0.62 $ 1.93 $ 1.16
=========== =========== =========== ===========
Diluted earnings per common share $ 0.63 $ 0.60 $ 1.90 $ 1.14
=========== =========== =========== ===========
</TABLE>
2. GAINS FROM SALE OF ASSETS
From time to time, Rayonier opportunistically sells non-strategic assets to
monetize portions of its asset base. In March 2000, Rayonier sold
approximately 57,000 acres of Southeastern U.S. forestland to various third
parties for $49.6 million, resulting in a pre-tax gain of $23.1 million
($14.4 million after tax, or $0.51 per diluted common share). The proceeds
of these sales were used to reduce debt.
3. RECLASSIFICATIONS
Certain reclassifications of the prior year amounts have been made to
conform with the current year presentation.
4
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
SEGMENT INFORMATION
Rayonier operates in two major business segments, Timber and Wood Products and
Specialty Pulp Products. The Timber and Wood Products segment includes two
reportable business units, Forest Resources and Trading and Wood Products.
Chemical Cellulose and Fluff and Specialty Paper Pulps are product lines within
the Specialty Pulp Products segment.
The amounts and relative contributions to sales and operating income
attributable to each of Rayonier's reportable business units for the three
months and six months ended June 30, 2000 and 1999 were as follows (thousands of
dollars):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
SALES
Timber and Wood Products
Forest Resources and Trading $ 116,746 $ 119,102 $ 241,315 $ 219,144
Wood Products 31,660 32,786 63,299 57,414
------------ ------------ ------------ ------------
Total Timber and Wood Products 148,406 151,888 304,614 276,558
------------ ------------ ------------ ------------
Specialty Pulp Products
Chemical Cellulose 74,073 69,945 148,852 132,785
Fluff and Specialty Paper Pulps 61,070 36,296 119,433 75,325
------------ ------------ ------------ ------------
Total Specialty Pulp Products 135,143 106,241 268,285 208,110
------------ ------------ ------------ ------------
Intersegment Eliminations 3 (106) (192) (249)
------------ ------------ ------------ ------------
Total Sales $ 283,552 $ 258,023 $ 572,707 $ 484,419
============ ============ ============ ============
OPERATING INCOME (LOSS)
Timber and Wood Products
Forest Resources and Trading $ 32,849 $ 29,892 $ 74,514 $ 58,409
Wood Products (2,736) 1,964 (4,133) 1,063
------------ ------------ ------------ ------------
Total Timber and Wood Products 30,113 31,856 70,381 59,472
Specialty Pulp Products 21,008 6,156 38,509 12,022
Corporate and Other (3,855) (4,261) (10,118) (8,299)
------------ ------------ ------------ ------------
Total Operating Income $ 47,266 $ 33,751 $ 98,772 $ 63,195
============ ============ ============ ============
</TABLE>
RESULTS OF OPERATIONS
SALES AND OPERATING INCOME (LOSS)
Sales for the second quarter of 2000 were $284 million, $26 million above prior
year, primarily due to higher U.S. Southeast timber harvest volumes and stronger
Specialty Pulp Products markets. Sales for the six months ended June 30, 2000 of
$573 million were $89 million higher than the prior year, due to increases in
the Specialty Pulp Products segment, primarily the result of higher prices and
volumes, as well as increases in the Timber and Wood Products segment, primarily
the result of increased log trading activity and timber harvesting in both the
Southeast and the Northwest U.S. regions.
Operating income for the second quarter of 2000 of $47 million was $14 million
above prior year, and operating income for the six months ended June 30, 2000 of
$99 million was $36 million above prior year. Specialty Pulp Products operating
results for both periods increased due to higher volumes, higher prices and
lower costs. Timber and Wood Products results declined in the second quarter
compared to the prior year due primarily to lower lumber pricing. However, the
unusually strong Northwest U.S. harvest during the first quarter resulted in
greater operating income for the six months ended June 30, 2000 when compared to
the prior year.
5
<PAGE> 8
TIMBER AND WOOD PRODUCTS
Timber and Wood Products sales for the second quarter of 2000 were $148 million,
$4 million below prior year, although sales for the six months ended June 30,
2000 were $28 million above prior year, at $305 million. Operating income for
the second quarter of 2000 of $30 million was $2 million below prior year.
However, operating income for the six months ended June 30, 2000 was $11 million
above prior year, at $70 million.
FOREST RESOURCES AND TRADING
Forest Resources and Trading sales for the second quarter of 2000 were $117
million, $2 million below prior year. Higher Southeast U.S. timber volumes
were more than offset by lower Northwest U.S. timber volumes, which had
been unusually strong in first quarter 2000. For the six months ended June
30, 2000, sales were $241 million, $22 million above prior year. The sales
improvement was the result of unusually strong first quarter 2000 Northwest
U.S. timber volumes and higher prices, increased volumes in the Southeast
U.S. resulting from the Smurfit forestlands acquisition, and higher log
trading activity in U.S. markets. These improvements in sales were
partially offset by lower timber prices in the Southeast U.S.
Operating income for the second quarter of 2000 was $33 million, $3 million
above prior year, and $75 million for the six months ended June 30, 2000,
$16 million above prior year. The increases were primarily a result of the
strong Northwest U.S. timber sales activity in first quarter of 2000.
Second quarter 2000 results were also adversely affected by $0.8 million in
additional foreign exchange translation losses compared to the prior year
and by $0.4 million due to the write off of fire-damaged, pre-merchantable
timber.
WOOD PRODUCTS
Wood Products sales for the second quarter of 2000 were $32 million, $1
million below prior year, although for the six months ended June 30, 2000
sales were $63 million, $6 million above prior year. Operating losses of $3
million and $4 million for the second quarter of 2000 and six months ended
June 30, 2000, respectively, were both $5 million below prior year results.
The lower operating income is attributable to lower lumber pricing and
higher logs costs, partially offset by continued operating and price
improvements at the New Zealand medium-density-fiberboard (MDF) plant.
SPECIALTY PULP PRODUCTS
Sales of Specialty Pulp Products for the second quarter of 2000 were $135
million, $29 million above prior year, due to stronger fluff pulp pricing and
higher pulp volumes, and for the six months ended June 30, 2000, sales were $268
million, $60 million above prior year. Operating income of $21 million and $39
million for the second quarter of 2000 and six months ended June 30, 2000,
respectively, were $15 million and $27 million above prior year. Second quarter
2000 fluff and specialty paper pulp prices were 28 percent higher than prior
year, while overall volumes for chemical cellulose, and fluff and specialty
paper pulps were 20 percent higher. For the six months ended June 30, 2000,
fluff and specialty paper pulp prices were 25 percent higher, while chemical
cellulose and fluff and specialty paper pulp volumes increased 21 percent.
CORPORATE AND OTHER
Corporate and other costs for the second quarter of 2000 were $3.9 million, $0.4
million below prior year, due to lower general administrative costs. However,
corporate and other expenses for the six months ended June 30, 2000 of $10.1
million were $1.8 million above prior year, principally as a result of costs
associated with the headquarters relocation from Stamford, CT to Jacksonville,
FL, partially offset by lower general administrative costs. The relocation is
essentially complete, on schedule and under budget.
INTEREST EXPENSE
Interest expense of $22 million and $44 million for the second quarter of 2000
and the six months ended June 30, 2000, respectively, were $14 million and $29
million above prior year, reflecting higher debt levels associated with the
Smurfit forestland acquisition and slightly higher interest rates.
6
<PAGE> 9
MISCELLANEOUS (EXPENSE) INCOME, NET
Miscellaneous (expense) income for the second quarter of 2000 was $(0.8) million
compared to $(0.2) million in the prior year, and $(0.6) million for the six
months ended June 30, 2000 compared to $0.5 million for the six months ended
June 30, 1999. The increased expense for both the second quarter of 2000 and the
six months ended June 30, 2000 reflect losses on the mark-to-market of foreign
exchange forward contracts.
GAINS FROM SALES OF ASSETS
In March 2000, Rayonier sold approximately 57,000 acres of non-strategic
Southeast U.S. forestland to various third parties for $49.6 million, resulting
in a pre-tax gain of $23.1 million ($14.4 million after tax, or $0.51 per
diluted common share). The proceeds of these sales were used to reduce debt.
INCOME TAX EXPENSE
The effective tax rate was 29.9 percent for the second quarter of 2000 and 31.2
percent for the six months ended June 30, 2000, compared to 33.9 percent and
33.3 percent for the corresponding periods in the prior year. The lower tax
rates in 2000 reflect the impact of increased foreign sales corporation tax
benefits. The effective tax rates continue to be below U.S. statutory rates,
resulting from the lower tax rates in effect for foreign subsidiaries and
various tax credits.
NET INCOME
Net income for the second quarter of 2000 was $17.4 million, or $0.63 per
diluted common share, compared to $17.1 million, or $0.60 per diluted common
share, for the second quarter of 1999. Net income for the six months ended June
30, 2000 was $52.9 million, or $1.90 per diluted common share, compared to $32
million, or $1.14 per diluted common share, for the six months ended June 30,
1999. Net income for the six months ended June 30, 2000 included $14.4 million,
or $0.51 per diluted common share, reflecting gains from the sale of
non-strategic forestland.
Specialty pulp markets are continuing to strengthen reflecting a tight supply
and demand balance, while New Zealand timber and MDF conditions are stable to
improving. As a result, full year 2000 net income is expected to be better than
in 1999, despite the timberland acquisition financing costs. However, results
for the third quarter of 2000 are expected to be somewhat lower than both the
second quarter of 2000 and the third quarter of 1999. In the third quarter,
improving pulp markets are expected to only partially offset the combined effect
of a lower U.S. Northwest harvest due to the seasonal slowdown in Northwest
timber harvests and the unusually strong harvest that took place in the first
quarter of 2000.
LIQUIDITY AND CAPITAL RESOURCES
Cash flow provided by operating activities of $107 million for the six months
ended June 30, 2000 increased $3 million from 1999, primarily as a result of
improvements in net income, partially offset by working capital requirements.
Cash flow provided by investing activities for the six months ended June 30,
2000 was $6 million, primarily the result of monetizing certain non-strategic
forestlands and reduced timber purchase agreements. EBITDA (defined as earnings
from continuing operations before significant non-recurring items, provision for
dispositions, interest expense, income taxes, depreciation, depletion and
amortization and the non-cash cost of land sales) for the three months and six
months ended June 30, 2000 was $83 million and $173 million, respectively, $26
million and $56 million higher, respectively, than the prior year. Cash from
operating activities were used to finance capital expenditures of $47 million,
dividends of $20 million and the repurchase of common shares for $9 million.
The Company repurchased 142,900 of its shares during the second quarter of 2000
at an average cost of $40.64 for a total of $6 million, and 228,500 shares
during the six months ended June 30, 2000 at an average cost of $40.92 for a
total of $9 million. During the second quarter of 1999 and the six months ended
June 30, 1999, the Company repurchased 86,900 and 124,300 shares, at average
costs of $46.92 and $45.05 per share for $4 million and $6 million,
respectively.
At June 30, 2000, debt was $1,053 million and the debt-to-capital ratio was 60.8
percent, compared to debt of $1,136 million and a debt-to-capital ratio of 63.5
percent at December 31, 1999. Excluding U.S. timberland external debt, corporate
debt was $323 million, a reduction of $96 million from December 31, 1999 and
$129 million from June 30, 1999. The Company has unsecured credit facilities
totaling $300 million, which were used as support for $45 million of outstanding
commercial paper. As of June 30, 2000, Rayonier (excluding U.S. timberland
revolving credit facilities) had $255 million available under its revolving
credit facilities.
In connection with the financing of the Smurfit forestland acquisition, Rayonier
Timberlands Operating Company, L.P. (RTOC), a wholly-owned limited partnership,
issued notes totaling $485 million, and entered into an agreement with a group
of banks that provided RTOC with an unsecured term loan of $200 million and
revolving credit facilities totaling $75 million, which expire in 2004.
7
<PAGE> 10
As of June 30, 2000 and December 31, 1999, RTOC's outstanding external debt was
$730 million and $717 million, respectively. RTOC had $30 million of available
borrowings under its revolving credit facilities as of June 30, 2000.
In addition, the Company has on file with the Securities and Exchange Commission
shelf registration statements to offer $150 million of new public debt
securities. The Company believes that internally generated funds, combined with
available external financing, will enable Rayonier to fund capital
expenditures, share repurchases, working capital and other liquidity needs for
the foreseeable future.
SAFE HARBOR
Comments about market trends, anticipated earnings and future activities in 2000
and beyond, are forward-looking and are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Changes in
the following important factors, among others, could cause actual results to
differ materially from those expressed in the forward-looking statements:
changes in global market trends; interest rate and currency movements;
fluctuations in demand for specialty chemical cellulose and fluff pulps, export
and domestic logs, and wood products; the impact of such market factors on the
Company's timber sales in the U.S. and New Zealand; adverse weather conditions;
production costs for wood products and for specialty pulps, particularly for raw
materials such as wood and chemicals; and governmental policies and regulations
affecting the environment, import and export controls, and taxes.
8
<PAGE> 11
ITEM 3. SELECTED OPERATING DATA
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
TIMBER AND WOOD PRODUCTS
Log trading sales volume
North America, in millions of board feet 62 45 124 75
New Zealand, in thousands of cubic meters 305 319 549 591
Other, in thousands of cubic meters 86 162 205 272
Timber sales volume
Northwest U.S., in millions of board feet 64 67 154 132
Southeast U.S., in thousands of short green tons 1,137 598 2,136 1,131
New Zealand, in thousands of cubic meters 289 321 542 591
Lumber sales volume, in millions of board feet 70 68 135 124
Medium-density fiberboard sales volume,
in thousands of cubic meters 39 31 76 58
Intercompany timber sales volume
Northwest U.S., in millions of board feet 19 8 39 18
Southeast U.S., in thousands of short green tons 11 4 23 11
New Zealand, in thousands of cubic meters 154 148 263 269
SPECIALTY PULP PRODUCTS
Pulp sales volume
Chemical cellulose, in thousands of metric tons 89 81 178 155
Fluff and specialty paper pulp, in thousands of metric tons 91 69 185 146
Production as a percent of capacity 101.1% 87.0% 102.6% 94.0%
</TABLE>
9
<PAGE> 12
SELECTED SUPPLEMENTAL FINANCIAL DATA
(thousands of dollars, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2000 1999 2000 1999
--------- --------- --------- ----------
<S> <C> <C> <C> <C>
GEOGRAPHICAL DATA (NON-U.S.)
Sales
New Zealand $ 23,559 $ 21,521 $ 42,853 $ 39,805
Other 12,859 11,101 23,997 21,083
--------- --------- --------- ----------
Total $ 36,418 $ 32,622 $ 66,850 $ 60,888
========= ========= ========= ==========
Operating income (loss)
New Zealand $ (355) $ (1,068) $ (1,464) $ (2,703)
Other 307 38 267 (268)
--------- --------- --------- ----------
Total $ (48) $ (1,030) $ (1,197) $ (2,971)
========= ========= ========= ==========
FOREST RESOURCES
Sales
Northwest U.S. $ 21,701 $ 23,716 $ 55,999 $ 47,582
Southeast U.S. 27,150 14,754 54,492 31,696
New Zealand 5,611 7,430 10,169 12,792
--------- --------- --------- ----------
Total $ 54,462 $ 45,900 $ 120,660 $ 92,070
========= ========= ========= ==========
Operating income
Northwest U.S. $ 17,409 $ 18,704 $ 47,038 $ 37,270
Southeast U.S. 11,902 10,532 24,787 22,995
New Zealand 1,660 2,467 2,782 3,465
--------- --------- --------- ----------
Total $ 30,971 $ 31,703 $ 74,607 $ 63,730
========= ========= ========= ==========
EBITDA per share
Northwest U.S. $ 0.66 $ 0.70 $ 1.77 $ 1.39
Southeast U.S. 0.85 0.47 1.71 1.01
New Zealand 0.17 0.21 0.31 0.35
--------- --------- --------- ----------
Total $ 1.68 $ 1.38 $ 3.79 $ 2.75
========= ========= ========= ==========
</TABLE>
10
<PAGE> 13
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of Shareholders of the Company was held on May 18,
2000. At that meeting, three directors were elected as follows (there
were no broker non-votes with respect to the election of directors):
<TABLE>
<CAPTION>
Votes For Votes Withheld
--------- --------------
<S> <C> <C>
Director of Class III, Term Expires in 2003:
Rand V. Araskog 23,724,109 109,208
W. Lee Nutter 23,747,958 85,359
Nicholas L. Trivisonno 23,748,335 84,982
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) See Exhibit Index.
(b) Rayonier Inc. did not file a report on Form 8-K during the quarter
covered by this report.
SIGNATURE
Pursuant to the requirements of Section 13 of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
RAYONIER INC. (Registrant)
BY /s/ GEORGE C. KAY
George C. Kay
Vice President and
Corporate Controller
(Chief Accounting Officer)
August 10, 2000
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EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION LOCATION
----------- ----------- --------
<S> <C> <C>
2 Plan of acquisition, reorganization, None
arrangement, liquidation or succession
3.1 Amended and restated articles of incorporation No amendments
3.2 By-laws No amendments
4 Instruments defining the rights of security holders, Not required to be filed. The
including indentures Registrant hereby agrees to file
with the Commission a copy of any
instrument defining the rights of
holders of the Registrant's
long-term debt upon request of the
Commission.
10 Material Contracts None
11 Statement re: computation of per share earnings Not required to be filed
12 Statement re: computation of ratios Filed herewith
15 Letter re: unaudited interim financial information None
18 Letter re: change in accounting principles None
19 Report furnished to security holders None
22 Published report regarding matters None
submitted to vote of security holders
23 Consents of experts and counsel None
24 Power of attorney None
27 Financial data schedule Filed herewith
99 Additional exhibits None
</TABLE>
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