Deltic Timber’s Q4 Profits Climb More Than 50%
by February 25, 2015 6:36 pm 122 views
Deltic Timber Corp. ended the year on a strong note as fourth quarter profits were improved from a year ago due to declining corporate expenses and robust residential lot sales at the company’s Chenal Valley development in west Little Rock.
For the period ended Dec. 31, 2014, the El Dorado-based timber harvester and real estate firm reported net income of $3.5 million, or 28 cents per share, up 52% percent compared to net income of $2.3 million, or 18 cents a year ago. Year-end results were essentially flat as net income was $19.7 million versus $20.3 million at the end 2013 – not counting one-time gains resulting from the acquisition of the company’s remaining 50% stake in Del-Tin Fiber medium density fiberboard plant in April 2013, and other asset conversion charges.
“Deltic’s vertically integrated operating assets produced solid financial results for the year of 2014, as the company’s performance essentially matched the record level of income reported for 2013,” said Deltic President and CEO Ray Dillon. “In addition, fourth quarter earnings were favorable to the same quarter a year ago, as we closed on the sale of 53 residential lots during the current-year quarter, evidence of continued demand for lots in our real estate developments.”
Overall, net cash provided by operating activities was $6.4 million for the fourth quarter of 2014, compared to $8.1 million for the same period a year ago. Cash provided by operating activities for the year of 2014 was $31.5 million, compared to $42.1 million for the year of 2013.
Going forward, Dillon offered a nuanced forecast on the company’s outlook for the first quarter and remainder of the year. He said pine sawtimber harvest and finished lumber sales for the first quarter of 2015 were largely dependent upon the weather and market conditions.
In the real estate segment, he said residential lots sale in the first quarter were projected at only two to 5 lots, but are forecasted to gain momentum with 75 to 100 lots sales for the rest of the year.
“Commercial acreage within Chenal Valley continues to receive interest, but due to the volatile nature of commercial real estate transactions and significant number of factors involved, it is difficult to anticipate future closings,” he said.
Meanwhile, Deltic said earnings and cash flows generated from current operations will allow the company to have enough capital to fund its $20.3 million capital program, buy back $7.9 million of Deltic stock, pay dividends to shareholders of $5.1 million, and pay off $7 million in outstanding debt.
At the close of business Wednesday, Deltic shares were down 33 cents at $65.92. Deltic Timber (NYSE: DEL) will hold a conference call on Thursday at 10 a.m. to discuss its fourth quarter and yearly results.