Announces strategic investment to build new TimberStrand®
facility in Arkansas
SEATTLE, Nov. 18,
2024 /PRNewswire/ -- Weyerhaeuser
Company (NYSE: WY) today announced its plan to invest
approximately $500 million to build a
new, state-of-the-art TimberStrand® facility near Monticello and Warren, Arkansas, expanding the company's
engineered wood products (EWP) capacity in the U.S. South. The
facility will have an annual production capacity of approximately
10 million cubic feet, which is comparable to the company's
existing TimberStrand® facility in Kenora, Ontario. Construction is expected to
begin in 2025, with the goal of starting operations in 2027.
The new facility will support an underserved and growing market
for TimberStrand® in the U.S. South and showcase Weyerhaeuser's
innovation in Wood Products. Leveraging its proprietary
TimberStrand® technology, the company is combining institutional
expertise from Kenora with
extensive research and development to manufacture TimberStrand®
with southern yellow pine as the primary feedstock. Given the
company's sizeable timber holdings in Arkansas, the Monticello facility is strategically located
to source most of its fiber log requirements from Weyerhaeuser
timberlands in the region. Additionally, the plant will include a
biomass-fueled cogeneration system, which will fully supply the
plant's electrical needs and significantly reduce its environmental
footprint.
Key attributes of the new facility:
- Doubles Weyerhaeuser's North American TimberStrand® capacity
and enhances the company's EWP offerings in the U.S. South
- Delivers seamless integration with existing Weyerhaeuser
timberlands and wood products distribution network, as well as with
readily available freight and rail transportation in the
region
- Expected to generate over $100
million of annual Adjusted EBITDA at full operating
capacity, with additional upside from portfolio integration
benefits
- Serves the company's strong and expanding customer base in the
region, along with increasing demand for TimberStrand® in housing
and industrial applications
- Enhances the company's product offering to the mass timber
market as it continues to grow and mature
- Aligns with the company's long-term sustainability and
greenhouse gas emissions reduction goals
- Expected to add nearly 200 high-quality jobs in Monticello and the surrounding area once fully
operational
- Expands the company's total investment and impact in
Arkansas, adding a third
manufacturing facility to go along with a lumber mill in
Dierks and a plywood and veneer
plant in Emerson, as well as 1.2
million acres of timberlands, a seedling nursery and several
offices — currently employing more than 700 people across the
state
"This is an exciting opportunity to grow our EWP business,
expand TimberStrand® into the U.S. South and provide an additional
outlet for our fiber logs in Arkansas," said Devin W. Stockfish, president
and chief executive officer. "Of the wood products we produce, EWP
has the strongest tie to single-family housing construction
activity, and this new facility aligns with our conviction that
U.S. housing demand will remain favorable over the long term. In
addition, this plant will allow Weyerhaeuser to better serve other
customers and end markets in the region, including mass timber
applications, and it supports our broader sustainability ambitions.
I'd like to thank the state of Arkansas and local officials for working with
Weyerhaeuser to site this facility. We look forward to building on
our long history in the state and providing new employment
opportunities in Monticello and
surrounding communities."
The company expects to incur approximately $500 million of capital expenditures for the
facility through 2027 and plans to exclude this investment for
purposes of calculating the company's annual Adjusted Funds
Available for Distribution, as used in its flexible cash return
framework. This capital outlay may be sourced from cash on hand or
through future financing, as the company deems appropriate.
ABOUT WEYERHAEUSER
Weyerhaeuser Company, one of the
world's largest private owners of timberlands, began operations in
1900 and today owns or controls approximately 10.5 million acres of
timberlands in the U.S., as well as 14 million acres of timberlands
managed under long-term licenses in Canada. Weyerhaeuser has been a global leader
in sustainability for more than a century and manages 100 percent
of its timberlands on a fully sustainable basis in compliance with
internationally recognized sustainable forestry standards.
Weyerhaeuser is also one of the largest manufacturers of wood
products in North America and
operates additional business lines around real estate, climate
solutions, energy and natural resources, among others. In 2023, the
company generated $7.7 billion in net
sales and employed approximately 9,300 people who serve customers
worldwide. Operated as a real estate investment trust,
Weyerhaeuser's common stock trades on the New York Stock Exchange
under the symbol WY. Learn more at www.weyerhaeuser.com.
NON-GAAP FINANCIAL MEASURES
This news release references a forward-looking estimate of Adjusted
EBITDA, which is a non-GAAP measure that management uses to
evaluate the performance of the company. Adjusted EBITDA, as we
define it, is operating income adjusted for depreciation,
depletion, amortization, basis of real estate sold and special
items. Adjusted EBITDA should not be considered in isolation from,
and is not intended to represent an alternative to, our GAAP
results. We have not provided a reconciliation of this
forward-looking non-GAAP financial measure to the most comparable
GAAP measure of net income because Adjusted EBITDA, as we define
it, excludes the impact of certain items listed above in our
definition of Adjusted EBITDA, and management cannot estimate these
items or the impact they will have on Adjusted EBITDA on a
forward-looking basis without unreasonable effort. As a result,
investors may be unable to accurately compare the expected impact
of this investment to our historical results or the results or
expected results of other companies that may have treated such
matters differently. Nonetheless, management believes that
providing this forward-looking non-GAAP information about this
investment is useful to investors, and given the uncertain nature
of forward-looking statements, we believe investors are able to
take into account the inherent limitations of this forward-looking
non-GAAP information. We cannot reasonably predict the occurrence,
timing or amount of any of the items that we exclude from our
Adjusted EBITDA estimate. Accordingly, the actual effect of these
items, when determined, could potentially be significant to the
calculation of Adjusted EBITDA and actual results may differ
materially from our estimate.
FORWARD-LOOKING STATEMENTS
This news release contains statements that are forward-looking
within the meaning of the Private Securities Litigation Reform Act
of 1995, as amended, concerning the company's plans to construct a
new TimberStrand® manufacturing facility including without
limitation with respect to the company's expectations about the
timing of construction and the start of operations, the amount of
required capital expenditure, plans for facility energy
requirements, planned production capacity and expected financial
and economic contributions including projected incremental annual
Adjusted EBITDA and number of new jobs. We also reference the
future growth of the mass timber market, the new facility's
alignment with our long-term sustainability and greenhouse gas
emissions reduction goals and our intent to exclude the cost of the
facility from our annual calculation of Adjusted Funds Available
for Distribution, and these also constitute forward-looking
statements. Forward-looking statements may be identified by our use
of certain words in such statements, including without limitation
words such as "expected," "goal," "plan," and "will" and other
words and expressions referencing future events or occurrences. All
forward-looking statements speak only as of the date hereof, are
based on current expectations and assumptions and are not
guarantees of future events or performance. The realization of our
expectations and the accuracy of our assumptions involve and are
subject to a number of risks and uncertainties that could cause
actual results to differ materially from those described in the
forward-looking statements. These risks and uncertainties include,
but are not limited to, those identified in our 2023 Annual Report
on Form 10-K, as well as those set forth from time to time in our
other public statements, reports, registration statements,
prospectuses, information statements and other filings with the
Securities and Exchange Commission. In addition to those risks and
uncertainties, other factors that could affect our ability to
commence or complete construction of the new TimberStrand® facility
within the stated time periods, or at all, or our ability to
realize the projected financial and economic benefits of the
project, include without limitation our ability to procure
necessary and applicable government licenses, approvals and
permits, our receipt of certain tax abatement and related financial
incentives from state and local government, the performance of our
vendors and contractors, facility equipment and machinery
procurement and performance, and other factors not described herein
or elsewhere because they are not currently known to us or because
we currently judge them to be immaterial. There is no guarantee
that any of the events anticipated by these forward-looking
statements will occur. If any of the events do occur, there is no
guarantee what effect they will have on the company's business,
results of operations, cash flows, financial condition or future
prospects. The company undertakes no obligation to update these
forward-looking statements after the date of this news release.
For more information contact:
Weyerhaeuser
Analysts – Andy Taylor, 206-539-3907
Media – Nancy Thompson,
919-861-0342
View original content to download
multimedia:https://www.prnewswire.com/news-releases/weyerhaeuser-expanding-engineered-wood-products-portfolio-302309066.html
SOURCE Weyerhaeuser Company