Land sales hit Plum Creek profits
9 August 2014Earnings at Plum Creek were lower in the first half of the year despite a 30% boost in operating income from its timber operations.
The US group was held back by a 24% fall in revenues from its real estate operations, which were US$100m, compared with US$131m for the first six months of last year.
Manufacturing was largely unchanged at US$184m and energy operations up US$7m to US$18m. However, revenues from timber were up 15% from US$316m to US$363m.
"So far this year the operating income and cash flow from our timber resources segments are up nearly 30% due to improving log prices and the additional harvests from lands we acquired in December," the company said.
Earnings were US$85m on revenues of US$673m, compared with US$102m on revenues of US$643m in 2013.
Earnings before tax and other costs were unchanged at US$233m.
"We are still expecting meaningful growth this year," said CEO Rick Holley. "The long-term trends in the timber industry give us confidence that timber markets will improve as lumber demand grows, although the recovery in 2014 has been more muted than we and other industry participants initially expected."
