The results even surprised Wall Street, which had recently revised its own estimates higher to account for the increasing activity in the housing market. The company reported net earnings of $144 million or 26 cents a share for the quarter ending in March.
A recent average of Wall Street analysts’ predictions called for the timber and wood products company to report a profit of 22 cents a share in the first quarter.
This year’s first quarter profit compares with a profit in the same quarter last year of two cents a share or $9 million before one-time items. Revenues were also up substantially over a year ago to $2 billion compared with $1.5 billion in the first quarter of 2012.
“Our wood products business reported its strongest quarterly earnings since 2005 as we effectively leverage operational improvement in a strengthening housing market,” said Dan Fulton, Weyerhaeuser’s chief executive, in a prepared statement.
“Our shareholders are benefiting from this improved performance with the decision by our board of directors to increase our quarterly dividend by 18 percent,” said Fulton.
In addition to the freshened demand for housing, the company’s profits were driven higher by increasing prices paid for logs in the West both in the export and domestic markets, the company said. In addition to higher prices for those logs, the harvest volumes also increased.
Weyerhaeuser, now structured as a real estate investment trust, is among the nation’s largest timber land holders with some six million acres in its portfolio in the United States and with some 14 million acres under its management in Canada.
Both lumber and oriented strand board prices rose during the quarter, the company said. Strand board prices were up 24 percent and lumber prices increased 20 percent. The company said it expects those trends to continue in the second quarter with higher sales ahead.