Form 8-K
Table of Contents

 
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
October 21, 2005
 
(Date of earliest event report)
WEYERHAEUSER COMPANY
 
(Exact name of registrant as specified in charter)
         
Washington   1-4825   91-0470860
         
(State or other
jurisdiction of
incorporation or
organization) 		  (Commission
File Number) 		  (IRS Employer
Identification
Number)
Federal Way, Washington 98063-9777
 
(Address of principal executive offices)
(zip code)
Registrant’s telephone number, including area code:
(253) 924-2345
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

TABLE OF CONTENTS
     
 
   Item 2.02. Results of Operations and Financial Condition
 
   SIGNATURES

 

Table of Contents

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C., 20549
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On October 21, 2005, Weyerhaeuser Company issued a press release stating the following:
Weyerhaeuser Reports Third Quarter Net Earnings of $285 Million, or $1.16 per Diluted Share, on Net Sales of $5.6 Billion
FEDERAL WAY, Wash. — Weyerhaeuser Company (NYSE: WY) today reported third quarter net earnings of $285 million, or $1.16 per diluted share, on net sales of $5.6 billion. This compares with $594 million, or $2.45 per diluted share, on net sales of $5.7 billion for the third quarter of 2004.
Third quarter 2005 earnings include the following after-tax items:
•   A gain of $75 million, or 31 cents per diluted share, for the sale of MAS Capital Management Partners, LP, a joint venture.
•   A charge of $19 million, or 8 cents per diluted share, for closure of facilities.
•   A loss of $14 million, or 6 cents per diluted share, for the early extinguishment of debt.
In addition, net earnings for third quarter 2005 include a one-time tax benefit of $14 million, or 6 cents per diluted share, related to a change in the Ohio state income tax law.
Third quarter 2004 earnings include the following after-tax items:
•   A gain of $179 million, or 74 cents per diluted share, from a sale of timberlands in Georgia.
•   A gain of $16 million, or 7 cents per diluted share, from a tenure reallocation agreement with the British Columbia government.
•   A gain of $13 million, or 5 cents per diluted share, due to the reduction of the reserve for hardboard siding claims.
•   A charge of $7 million, or 3 cents per diluted share, related to the sale or closure of facilities.
“Our results in the third quarter reflect the difficult business conditions we face in certain segments,” said Steven R. Rogel, chairman, president and chief executive officer. “Although the recent hurricanes did not significantly affect our operations, we expect to experience residual effects of the storms in terms of higher energy, chemical and transportation costs. This will put additional pressure on our businesses in the fourth quarter.”
Rogel said the company’s strategic review of its business portfolio has resulted in the previously announced indefinite shutdown of the Prince Albert pulp and paper facility in Canada and the closure of two facilities — a specialty pulp mill and a large-log sawmill — in Washington.
“These are the first, but by no means the final steps,” Rogel said. “We will continue to take the actions necessary to make Weyerhaeuser a more competitive company and generate greater returns while returning cash to our shareholders. To that end, we are pleased to have announced today that the board of directors authorized the repurchase of up to 18 million shares, or 7.4 percent of Weyerhaeuser’s outstanding common stock.”
SUMMARY OF THIRD QUARTER FINANCIAL HIGHLIGHTS
                         
Millions (except per share data)   3Q 2005     3Q 2004     Change  
Net earnings
     $285     $ 594       ($309 )
Earnings per diluted share
   $ 1.16     $ 2.45       ($1.29 )
Net sales
   $ 5,604     $ 5,679       ($75 )
SEGMENT RESULTS FOR THIRD QUARTER
(Contributions to Pre-Tax Earnings)
                         
Millions   3Q 2005     3Q 2004     Change  
Timberlands
   $ 191     $ 450       ($259 )
Wood Products
   $ 124     $ 362       ($238 )
Cellulose Fiber and White Papers
     ($2 )   $ 80       ($82 )
Containerboard, Packaging and Recycling
   $ 36     $ 82       ($46 )
Real Estate and Related Assets
   $ 145     $ 155       ($10 )

 

Table of Contents

DISCUSSION AND OUTLOOK BY BUSINESS SEGMENT
TIMBERLANDS
                         
    3Q 2005     2Q 2005     Change  
Contribution to earnings (millions)
   $191       $210       ($19)  
Third quarter earnings decreased from the second quarter due to higher fuel prices that affected logging and hauling costs, and a $5 million pre-tax charge related to timber damage caused by Hurricane Katrina. In addition, second quarter results include $6 million earnings from the British Columbia Coastal operations, which were sold in May.
The segment expects fourth quarter earnings to be lower than the third quarter, reflecting decreased Western profits due to normal seasonal slowdowns, and expected lower domestic sales prices. Export log markets are expected to remain firm. In the South, the segment expects log prices to decline from third quarter. Costs are expected to increase due to hurricane salvage operations.
WOOD PRODUCTS
                         
    3Q 2005     2Q 2005     Change  
Contribution to earnings (millions)
     $124     $204       ($80)  
Earnings decreased from second quarter due primarily to lower average price realizations for lumber and oriented strand board. Second quarter earnings included $18 million in pre-tax charges related to litigation.
Demand for building products remained strong throughout the quarter. However, readily available supply caused prices to decline during the first two months of the quarter.
Despite temporary price increases in September following the hurricanes, average prices for the entire quarter were lower for Weyerhaeuser lumber and oriented strand board. Lumber realizations declined $31 per thousand board feet and oriented strand board declined $30 per thousand square feet (3/8” basis). Average price realizations for engineered products increased from the second quarter, partially offsetting the effects from lumber and oriented strand board. The hurricanes had a minimal effect on total production for the segment.
The segment incurred $19 million in countervailing and anti-dumping duties and related costs on Canadian softwood lumber the company sold into the United States in the third quarter, compared with $27 million in the second quarter.
The segment expects normal seasonal slowing in the fourth quarter resulting in price decreases in commodity building products and reduced shipment volumes. The segment also expects to incur continued increased costs for energy, resin and transportation. As a result, fourth quarter earnings are expected to follow their normal seasonal decrease. In addition, the segment will be affected by an estimated $25 million pre-tax charge associated with the Big River sawmill in Saskatchewan.

 

Table of Contents

CELLULOSE FIBER AND WHITE PAPERS
                         
    3Q 2005     2Q 2005     Change  
Contribution (charge) to earnings (millions)
     ($2)       $16       ($18)  
Segment earnings declined from second quarter due to a third quarter pre-tax charge of $22 million primarily related to the closure of the Cosmopolis, Wash., pulp facility.
Papergrade pulp prices declined during the quarter due to continued strong supply coupled with the normal seasonal slowdown in demand. Fluff pulp prices remained relatively stable. Fine paper prices declined due to lower demand in North America for fine paper products. Manufacturing costs were lower due to fewer scheduled third quarter maintenance shutdowns. The negative effects of the strengthening Canadian dollar and increased costs for transportation, energy and raw material partially offset this cost reduction.
The company expects fourth quarter results to decline due to lower fine paper prices, seasonally lower shipments, and higher transportation, chemical and energy costs. In addition, the segment will be affected by an estimated $350 to $375 million pre-tax charge associated with the previously announced indefinite closure of the Prince Albert pulp and paper facility as the company continues the portfolio improvement strategy in this segment.
CONTAINERBOARD, PACKAGING AND RECYCLING
                         
    3Q 2005     2Q 2005     Change  
Contribution to earnings (millions)
     $36       $99       ($63)  
Earnings decreased from second quarter levels primarily due to lower prices for containerboard and boxes, and increased transportation and energy costs. The hurricanes had a minimal effect on the segment’s operating results for the third quarter.
The segment expects fourth quarter earnings to decrease to near break-even levels due to a continued decline in box prices resulting from earlier declines in containerboard prices, a seasonal decline in box shipments and higher energy costs, partially offset by lower costs for old corrugated containers. The recently announced containerboard and box price increase will not materially affect earnings in the fourth quarter.
REAL ESTATE AND RELATED ASSETS
                         
    3Q 2005   2Q 2005   Change
Contribution to earnings (millions)
  $ 145     $ 156       ($11 )
Single-family home closings declined slightly from second quarter due to delays in providing utility services in Las Vegas, Hurricane Rita in Texas and fewer lot closings. The backlog of homes sold, but not closed, increased and represents slightly more than six months’ sales.
The segment expects fourth quarter earnings to be significantly higher than third quarter due to seasonally stronger single-family closings, which will exceed the fourth quarter of 2004.

 

Table of Contents

OTHER
The company will hold a live conference call at 7 a.m. Pacific (10 a.m. Eastern) on Oct. 21 to discuss the third quarter results.
To access the conference call, listeners calling from within North America should dial 1-888-221-5699 at least 15 minutes prior to the start of the conference call. Those wishing to access the call from outside North America should dial 1-706-643-3795. Replays of the call will be available for one week following completion of the live call and can be accessed at 1-800-642-1687 (access code —1384562) within North America and at 1-706-645-9291 (access code — 1384562) from outside North America.
The call is being webcast and can be accessed through Weyerhaeuser’s Internet site at http://investor.weyerhaeuser.com by clicking on the “Q3 2005 Earnings Conference Call” link.
The webcast also is being distributed through the Thomson StreetEvents Network to both institutional and individual investors. Individual investors can listen to the call at http://www.fulldisclosure.com, Thomson/CCBN’s individual investor portal, powered by StreetEvents. Institutional investors can access the call via Thomson’s password-protected event management site, StreetEvents (http://www.streetevents.com).
Weyerhaeuser Company, one of the world’s largest integrated forest products companies, was incorporated in 1900. In 2004, sales were $22.7 billion. It has offices or operations in 19 countries, with customers worldwide. Weyerhaeuser is principally engaged in the growing and harvesting of timber; the manufacture, distribution and sale of forest products; and real estate construction, development and related activities. Additional information about Weyerhaeuser’s businesses, products and practices is available at http://www.weyerhaeuser.com.
###
This news release contains statements concerning the company’s future results and performance that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Some of these forward-looking statements can be identified by the use of forward-looking terminology such as “expects,” “may,” “will,” “believes,” “should,” “approximately,” anticipates,” “estimates,” and “plans,” and the negative or other variations of those terms or comparable terminology or by discussions of strategy, plans or intentions. In particular, some of these forward-looking statements deal with expectations regarding the company’s markets in the fourth quarter; expected earnings and performance of the company’s business segments during the fourth quarter, demand and pricing for the company’s products in the fourth quarter, raw material, energy and transportation costs, hurricane salvage costs, seasonal slowdowns in timber harvest in the fourth quarter, facility closings and related charges, new home sales, and related matters. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to:
•   The effect of general economic conditions, including the level of interest rates and housing starts;
•   Market demand for the company’s products, which may be tied to the relative strength of various U.S. business segments;
•   Energy prices;
•   Raw material prices;
•   Performance of the company’s manufacturing operations;
•   The successful execution of internal performance plans;
•   The level of competition from domestic and foreign producers;
•   The effect of forestry, land use, environmental and other governmental regulations;
•   The effect of weather;
•   The risk of loss from fires, floods and other natural disasters;
•   Transportation costs;
•   Legal proceedings; and
•   Performance of pension fund investments and related derivatives.
The company is also a large exporter and is affected by changes in economic activity in Europe and Asia, particularly Japan, and by changes in currency exchange rates, particularly the relative value of the U.S. dollar to the Euro and the Canadian dollar, and restrictions on international trade or tariffs imposed on imports, including the countervailing and anti-dumping duties imposed on the company’s softwood lumber shipments from Canada to the United States. These and other factors could cause or contribute to actual results differing materially from such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will occur, or if any of them occurs, what effect they will have on the company’s results of operations or financial condition. The company expressly declines any obligation to publicly revise any forward-looking statements that have been made to reflect the occurrence of events after the date of this news release.

 

Table of Contents

WEYERHAEUSER COMPANY
STATISTICAL INFORMATION (unaudited)
                                                                                 
CONSOLIDATED EARNINGS   Q1     Q2     Q3     Year-to-date     Q4     Year-to-date  
(in millions)   March 27,     March 28,     June 26,     June 27,     Sept. 25,     Sept. 26,     Sept. 25,     Sept. 26,     Dec. 26,     Dec. 26,  
    2005     2004     2005     2004     2005     2004     2005     2004     2004     2004  
Net sales and revenues:
                                                                                
Weyerhaeuser (1)
   $ 4,749     $ 4,442     $ 5,190     $ 5,204     $ 5,008     $ 5,088     $ 14,947     $ 14,734     $ 4,804     $ 19,538  
Real Estate and Related Assets
     655       469       648       524       596       591       1,899       1,584       911       2,495  
 
                                                            
Total net sales and revenues
     5,404       4,911       5,838       5,728       5,604       5,679       16,846       16,318       5,715       22,033  
 
                                                            
Costs and expenses:
                                                                                
Weyerhaeuser:
                                                                                
Costs of products sold
     3,652       3,432       3,974       3,790       3,934       3,758       11,560       10,980       3,735       14,715  
Depreciation, depletion and amortization
     325       317       326       318       329       316       980       951       320       1,271  
Selling expenses
     118       120       119       122       119       123       356       365       119       484  
General and administrative expenses
     223       239       218       233       236       226       677       698       247       945  
Research and development expenses
     14       12       12       13       18       13       44       38       17       55  
Taxes other than payroll and income taxes
     46       48       48       47       69       51       163       146       48       194  
Charges for integration and restructuring
     5       15       4       13       2       8       11       36       3       39  
Charges for closure of facilities
     5       4       3       —       29       13       37       17       —       17  
Other operating costs, net (2) (3)
     9       17       (40 )     43       (147 )     (300 )     (178 )     (240 )     36       (204 )
 
                                                            
 
     4,397       4,204       4,664       4,579       4,589       4,208       13,650       12,991       4,525       17,516  
 
                                                            
Real Estate and Related Assets:
                                                                                
Costs and operating expenses
     426       321       441       381       401       414       1,268       1,116       647       1,763  
Depreciation and amortization
     3       2       4       4       4       3       11       9       5       14  
Selling expenses
     33       27       36       30       36       31       105       88       37       125  
General and administrative expenses
     24       17       25       19       27       19       76       55       26       81  
Taxes other than payroll and income taxes
     1       1       —       —       1       1       2       2       —       2  
Other operating costs, net
     —       1       (2 )     1       (2 )     (19 )     (4 )     (17 )     —       (17 )
 
                                                            
 
     487       369       504       435       467       449       1,458       1,253       715       1,968  
 
                                                            
Total costs and expenses
     4,884       4,573       5,168       5,014       5,056       4,657       15,108       14,244       5,240       19,484  
 
                                                            
Operating income
     520       338       670       714       548       1,022       1,738       2,074       475       2,549  
Interest expense and other:
                                                                                
Weyerhaeuser:
                                                                                
Interest expense incurred (4)
     (196 )     (195 )     (179 )     (218 )     (193 )     (184 )     (568 )     (597 )     (241 )     (838 )
Less interest capitalized
     —       3       2       1       3       —       5       4       5       9  
Equity in income of affiliates
     —       —       4       7       2       4       6       11       3       14  
Interest income and other
     27       3       20       5       28       7       75       15       9       24  
Real Estate and Related Assets:
                                                                                
Interest expense incurred
     (14 )     (15 )     (14 )     (14 )     (13 )     (14 )     (41 )     (43 )     (14 )     (57 )
Less interest capitalized
     14       15       14       14       13       14       41       43       14       57  
Equity in income of unconsolidated entities
     10       9       13       20       14       12       37       41       11       52  
Interest income and other
     5       11       (2 )     9       4       1       7       21       10       31  
 
                                                            
Earnings before income taxes
     366       169       528       538       406       862       1,300       1,569       272       1,841  
Income taxes (5)
     (128 )     (57 )     (229 )     (183 )     (120 )     (293 )     (477 )     (533 )     (94 )     (627 )
 
                                                            
Earnings from continuing operations
     238       112       299       355       286       569       823       1,036       178       1,214  
Earnings from discontinued operations, net of taxes (6)
     1       9       121       14       (1 )     25       121       48       21       69  
 
                                                            
Net earnings
   $ 239     $ 121     $ 420     $ 369     $ 285     $ 594     $ 944     $ 1,084     $ 199     $ 1,283  
 
                                                            
Basic net earnings per share:
                                                                                
Continuing operations
   $ 0.98     $ 0.50     $ 1.23     $ 1.51     $ 1.16     $ 2.36     $ 3.36     $ 4.45     $ 0.73     $ 5.16  
Discontinued operations
     —       0.04       0.49       0.06       —       0.10       0.50       0.20       0.09       0.29  
 
                                                            
Net earnings per share
   $ 0.98     $ 0.54     $ 1.72     $ 1.57     $ 1.16     $ 2.46     $ 3.86     $ 4.65     $ 0.82     $ 5.45  
 
                                                            
Diluted net earnings per share:
                                                                                
Continuing operations
   $ 0.98     $ 0.50     $ 1.22     $ 1.51     $ 1.16     $ 2.35     $ 3.36     $ 4.42     $ 0.73     $ 5.14  
Discontinued operations
     —       0.04       0.49       0.06       —       0.10       0.49       0.20       0.09       0.29  
 
                                                            
Net earnings per share
   $ 0.98     $ 0.54     $ 1.71     $ 1.57     $ 1.16     $ 2.45     $ 3.85     $ 4.62     $ 0.82     $ 5.43  
 
                                                            
Dividends paid per share
   $ 0.40     $ 0.40     $ 0.50     $ 0.40     $ 0.50     $ 0.40     $ 1.40     $ 1.20     $ 0.40     $ 1.60  
 
                                                            
Weighted average shares outstanding (in thousands)
                                                                                
Basic
     242,863       223,728       244,702       234,494       245,009       241,621       244,191       233,281       242,114       235,453  
Diluted
     244,185       225,072       245,881       235,475       246,190       242,649       245,354       234,356       243,472       236,546  
 
(1)   The first, second and third quarters of 2005 include charges of $22 million, $27 million and $19 million, respectively, or $68 million year-to-date, for countervailing and anti-dumping duties and related costs. The first, second, third and fourth quarters of 2004 include charges of $26 million, $34 million, $31 million and $27 million, respectively, or $118 million year-to-date, for countervailing and anti-dumping duties and related costs.
 
(2)   The first, second and third quarters of 2005 include net foreign exchange gains (losses) of $13 million, ($13) million and $37 million, respectively, for a year-to-date net gain $37 million. The first, second, third and fourth quarters of 2004 include net foreign exchange gains (losses) of ($9) million, ($7) million, $16 million and $27 million, respectively, for a total year-to-date net gain of $27 million. These gains and losses result primarily from fluctuations in Canadian and New Zealand exchange rates.
 
(3)   The first quarter of 2005 includes a $12 million charge for the settlement of a linerboard antitrust lawsuit. The second quarter of 2005 includes an $18 million charge related to alder litigation and $57 million of income related to the recognition of a deferred gain from previous timberlands sales. The third quarter of 2005 includes a $115 million gain on the sale of an investment in a joint venture.
 
    The first quarter of 2004 includes a $49 million charge for the settlement of lawsuits involving the market for Pacific Northwest alder logs and a $33 million gain on the sale of an oriented strand board mill in Slave Lake, Alberta. The second quarter of 2004 includes a $16 million charge resulting from an adverse judgment in a lawsuit involving the market for Pacific Northwest alder logs. The third quarter of 2004 includes a $271 million gain on the sale of timberlands in Georgia, a $25 million gain from a tenure reallocation agreement with the British Columbia government, and a $20 million gain due to the reduction of the reserve for hardboard siding claims. The fourth quarter of 2004 includes a net gain of $36 million on the sale of facilities, and charges of $29 million for the impairment of assets in the company’s European manufacturing operations, $24 million recognized in connection with a change in the method of estimating workers’ compensation liabilities and $23 million for the net book value of technology donated to a university.
 
(4)   The third quarter of 2005 includes a charge of $21 million for the early extinguishment of debt. The second and fourth quarters of 2004 include charges of $21 million and $52 million, respectively, for the early extinguishment of debt.
 
(5)   The second quarter of 2005 includes a charge of $44 million related to the repatriation of $1.1 billion of eligible Canadian earnings under the provisions of the American Jobs Creation Act of 2004. The third quarter of 2005 includes a one-time tax benefit of $14 million related to a change in the Ohio state income tax law.
 
(6)   Includes the net operating results of the company’s operations in coastal British Columbia. The second quarter of 2005 also includes a gain of $110 million, including a tax benefit of $46 million, related to the sale of these operations. The third quarter of 2005 includes a $1 million charge related to the termination of pension plans associated with these operations.
PRELIMINARY RESULTS — SUBJECT TO AUDIT

 

Table of Contents

WEYERHAEUSER COMPANY
STATISTICAL INFORMATION (unaudited)
                                                                                 
Net sales and revenues (in millions):   Q1     Q2     Q3     Year-to-date     Q4     Year-to-date  
    March 27,     March 28,     June 26,     June 27,     Sept. 25,     Sept. 26,     Sept. 25,     Sept. 26,     Dec. 26,     Dec. 26,  
    2005     2004     2005     2004     2005     2004     2005     2004     2004     2004  
Timberlands:
                                                                                
Logs
   $ 182     $ 193     $ 195     $ 211     $ 188     $ 197     $ 565     $ 601     $ 221     $ 822  
Other products
     82       58       63       66       65       51       210       175       105       280  
 
                                                            
 
     264       251       258       277       253       248       775       776       326       1,102  
 
                                                            
Wood Products:
                                                                                
Softwood lumber
     892       819       1,032       1,106       889       1,089       2,813       3,014       901       3,915  
Plywood
     183       221       196       263       184       237       563       721       208       929  
Veneer
     13       11       10       12       9       11       32       34       10       44  
Composite panels
     120       108       132       133       122       138       374       379       122       501  
OSB
     288       338       306       456       267       341       861       1,135       255       1,390  
Hardwood lumber
     94       90       102       100       95       89       291       279       86       365  
Engineered I-Joists
     160       134       213       178       202       189       575       501       177       678  
Engineered Solid Section
     190       148       241       194       244       203       675       545       189       734  
Logs
     27       23       24       38       6       32       57       93       32       125  
Other products
     272       255       339       312       326       315       937       882       280       1,162  
 
                                                            
 
     2,239       2,147       2,595       2,792       2,344       2,644       7,178       7,583       2,260       9,843  
 
                                                            
Cellulose Fiber and White Papers:
                                                                                
Pulp
     376       339       355       371       381       381       1,112       1,091       380       1,471  
Paper
     599       535       611       538       604       583       1,814       1,656       570       2,226  
Coated groundwood
     42       36       47       37       45       39       134       112       44       156  
Liquid packaging board
     47       49       52       53       50       53       149       155       53       208  
Other products
     14       10       12       13       16       15       42       38       16       54  
 
                                                            
 
     1,078       969       1,077       1,012       1,096       1,071       3,251       3,052       1,063       4,115  
 
                                                            
Containerboard, Packaging and Recycling:
                                                                                
Containerboard
     117       81       101       80       86       94       304       255       113       368  
Packaging
     898       853       969       918       929       916       2,796       2,687       897       3,584  
Recycling
     92       80       92       91       87       87       271       258       89       347  
Bags
     22       19       21       18       20       20       63       57       23       80  
Other products
     34       33       40       34       47       43       121       110       46       156  
 
                                                            
 
     1,163       1,066       1,223       1,141       1,169       1,160       3,555       3,367       1,168       4,535  
 
                                                            
Real Estate and Related Assets
     655       469       648       524       596       591       1,899       1,584       911       2,495  
Corporate and Other
     149       135       151       147       146       135       446       417       158       575  
Less sales of discontinued operations
     (144 )     (126 )     (114 )     (165 )     —       (170 )     (258 )     (461 )     (171 )     (632 )
 
                                                            
 
   $ 5,404     $ 4,911     $ 5,838     $ 5,728     $ 5,604     $ 5,679     $ 16,846     $ 16,318     $ 5,715     $ 22,033  
 
                                                            
                                                                                 
Contribution (charge) to earnings:   Q1     Q2     Q3     Year-to-date     Q4     Year-to-date  
(in millions)   March 27,     March 28,     June 26,     June 27,     Sept. 25,     Sept. 26,     Sept. 25,     Sept. 26,     Dec. 26,     Dec. 26,  
    2005     2004     2005     2004     2005     2004     2005     2004     2004     2004  
Timberlands (1) (2)
   $ 200     $ 159     $ 210     $ 201     $ 191     $ 450     $ 601     $ 810     $ 217     $ 1,027  
Wood Products (3) (4) (5) (6)
     131       173       204       448       124       362       459       983       72       1,055  
Cellulose Fiber and White Papers (7)
     19       (25 )     16       14       (2 )     80       33       69       35       104  
Containerboard, Packaging and Recycling (8) (9)
     48       24       99       62       36       82       183       168       81       249  
Real Estate and Related Assets (10)
     183       120       156       118       145       155       484       393       217       610  
Corporate and Other (11) (12) (13)
     (17 )     (76 )     99       (67 )     101       (45 )     183       (188 )     (83 )     (271 )
 
                                                            
 
   $ 564     $ 375     $ 784     $ 776     $ 595     $ 1,084     $ 1,943     $ 2,235     $ 539     $ 2,774  
 
                                                            
 
(1)   The 2004 third quarter includes a $271 million gain on the sale of timberlands in Georgia and a $5 million gain from a tenure reallocation agreement with the British Columbia government.
 
(2)   The first quarter of 2005 includes $3 million of charges for the closure of facilities. The third quarter of 2005 includes a $5 million loss related to hurricane damage.
 
(3)   The first, second and third quarters of 2005 include charges of $22 million, $27 million and $19 million, respectively, or $68 million year-to-date, for countervailing and anti-dumping duties and related costs. The first, second, third and fourth quarters of 2004 include charges of $26 million, $34 million, $31 million and $27 million, respectively, or $118 million year-to-date, for countervailing and anti-dumping duties and related costs.
 
(4)   The second quarter of 2005 includes an $18 million charge related to alder litigation. The third quarter of 2005 includes $9 million of income related to the reduction of reserves for alder litigation and an insurance settlement related to product liability claims. The first quarter of 2004 includes a $49 million charge for the settlement of lawsuits involving the market for Pacific Northwest alder logs. The second quarter of 2004 includes a $16 million charge resulting from an adverse judgment in a lawsuit involving the market for Pacific Northwest alder logs. The third quarter of 2004 includes a $20 million gain due to the reduction of the reserve for hardboard siding claims.
 
(5)   The second quarter of 2005 includes a $6 million gain related to a tenure reallocation agreement with the British Columbia government. The third quarter of 2004 includes a $20 million gain from a tenure reallocation agreement with the British Columbia government.
 
(6)   The first, second and third quarters of 2005 include charges of $1 million, $1 million and $6 million, respectively, associated with the sale or closure of facilities. The first quarter of 2004 includes a credit of $2 million for the reversal of closure costs accrued in prior years and a $33 million gain on the sale of an oriented strand board mill in Slave Lake, Alberta. The second quarter of 2004 includes a $5 million net loss on the sale of facilities. The third quarter of 2004 includes a $2 million net gain on the sale or closure of facilities. The fourth quarter of 2004 includes charges of $3 million for the closure of facilities and a gain of $36 million on the sale of facilities.
 
(7)   The third quarter of 2005 includes net charges of $22 million related to facility closures. The second quarter of 2004 includes a $2 million asset impairment charge related to assets held for sale.
 
(8)   The first quarter of 2005 includes a $12 million charge associated with the settlement of a linerboard antitrust lawsuit. The third quarter of 2005 includes a $1 million loss related to hurricane damage.
 
(9)   The first, second and third quarters of 2005 include charges of $4 million, $2 million and $1 million, respectively, for the closure of facilities. The first quarter of 2004 includes closure costs of $3 million. The second quarter of 2004 includes a net gain of $1 million on the sales of a facility and a joint venture investment. The third quarter of 2004 includes closure costs of $12 million, including a pension termination charge of $9 million related to a closure that occurred in a previous year. The fourth quarter of 2004 includes a credit of $3 million for the reversal of closure costs accrued in prior years.
 
(10)   The first, second and third quarters of 2005 include net gains (losses) on land and lot sales of $57 million, $21 million and ($1) million, respectively. The first quarter of 2004 includes a $22 million gain on a land sale. The third quarter of 2004 includes a gain of $18 million on the sale of a multi-family site. The fourth quarter of 2004 includes a $24 million net gain on land and lot sales.
 
(11)   The second quarter of 2005 includes a $64 million pretax gain on the sale of the company’s operations in coastal British Columbia and $57 million of income related to the recognition of a deferred gain from previous timberlands sales. The third quarter of 2005 includes a $115 million gain on the sale of an investment in a joint venture. The fourth quarter of 2004 includes a $7 million gain for the settlement of an insurance claim relating to the Cemwood litigation.
 
(12)   The fourth quarter of 2004 includes charges of $29 million for the impairment of assets in the company’s European manufacturing operations, $24 million recognized in connection with a change in the method of estimating workers’ compensation liabilities and $23 million for the net book value of technology donated to a university.
 
(13)   The first, second and third quarters of 2005 include net foreign exchange gains (losses) of $13 million, ($12) million and $38 million, respectively, for a year-to-date net gain of $39 million. The first, second, third and fourth quarters of 2004 include net foreign exchange gains (losses) of ($10) million, ($6) million, $16 million and $26 million, respectively, for a $26 million net gain year-to-date. These gains and losses result primarily from fluctuations in Canadian and New Zealand exchange rates.
PRELIMINARY RESULTS — SUBJECT TO AUDIT

 

Table of Contents

WEYERHAEUSER COMPANY
STATISTICAL INFORMATION (unaudited)
                                                                                 
Third party sales volumes:   Q1     Q2     Q3       Year-to-date     Q4     Year-to-date  
    March 27,     March 28,     June 26,     June 27,     Sept. 25,     Sept. 26,     Sept. 25,     Sept. 26,     Dec. 26,     Dec. 26,  
    2005     2004     2005     2004     2005     2004     2005     2004     2004     2004  
Timberlands (thousands):
                                                                                
Logs — cunits
     864       1,044       863       954       886       904       2,613       2,902       1,018       3,920  
Wood Products (millions):
                                                                                
Softwood lumber — board feet
     2,057       2,054       2,355       2,393       2,179       2,299       6,591       6,746       2,144       8,890  
Plywood — square feet (3/8”)
     537       642       600       668       558       672       1,695       1,982       647       2,629  
Veneer — square feet (3/8”)
     60       55       59       60       51       55       170       170       55       225  
Composite panels — square feet (3/4”)
     299       301       317       324       308       315       924       940       294       1,234  
Oriented strand board — square feet (3/8”)
     908       981       1,041       1,143       1,008       1,078       2,957       3,202       1,011       4,213  
Hardwood lumber — board feet
     102       103       114       117       105       102       321       322       95       417  
Engineered I-Joists — LF
     108       108       138       132       125       133       371       373       123       496  
Engineered Solid Section — CF
     9       8       10       10       10       10       29       28       9       37  
Logs — cunits (in thousands)
     187       170       177       279       41       237       405       686       248       934  
Cellulose Fiber and White Papers (thousands):
                                                                                
Pulp — air-dry metric tons
     629       624       587       642       653       633       1,869       1,899       659       2,558  
Paper — tons
     736       741       742       718       757       737       2,235       2,196       680       2,876  
Coated groundwood — tons
     58       59       62       61       56       60       176       180       63       243  
Liquid packaging board — tons
     60       66       65       72       64       69       189       207       69       276  
Paper converting — tons
     475       467       494       459       494       470       1,463       1,396       443       1,839  
Containerboard, Packaging and Recycling (thousands):
                                                                                
Containerboard — tons
     295       250       259       221       238       245       792       716       285       1,001  
Packaging — MSF
     17,354       18,146       18,600       18,917       18,560       18,287       54,514       55,350       17,535       72,885  
Recycling — tons
     692       678       695       701       665       645       2,052       2,024       670       2,694  
Kraft bags and sacks — tons
     23       24       22       23       22       23       67       70       25       95  
Real Estate and Related Assets:
                                                                                
Single-family homes sold
     1,378       1,506       1,525       1,564       1,608       1,313       4,511       4,383       992       5,375  
Single-family homes closed
     1,189       1,065       1,279       1,216       1,257       1,345       3,725       3,626       1,638       5,264  
Single-family homes sold but not closed at end of period
     2,561       2,702       2,807       3,050       3,158       3,018       3,158       3,018       2,372       2,372  
                                                                                 
Total production volumes:   Q1     Q2     Q3     Year-to-date     Q4     Year-to-date  
    March 27,     March 28,     June 26,     June 27,     Sept. 25,     Sept. 26,     Sept. 25,     Sept. 26,     Dec. 26,     Dec. 26,  
    2005     2004     2005     2004     2005     2004     2005     2004     2004     2004  
Timberlands (thousands):
                                                                                
Fee Depletion — cunits
     2,248       2,265       2,231       2,404       2,098       2,189       6,577       6,858       2,155       9,013  
Wood Products (millions):
                                                                                
Softwood lumber — board feet
     1,821       1,760       1,869       1,881       1,651       1,819       5,341       5,460       1,727       7,187  
Plywood — square feet (3/8”)
     303       422       302       405       296       405       901       1,232       396       1,628  
Veneer — square feet (3/8”) (1)
     517       585       529       609       486       592       1,532       1,786       600       2,386  
Composite panels — square feet (3/4”)
     267       268       282       281       268       272       817       821       245       1,066  
Oriented strand board — square feet (3/8”)
     1,007       1,031       1,019       1,056       1,017       1,022       3,043       3,109       972       4,081  
Hardwood lumber — board feet
     92       89       96       96       91       84       279       269       80       349  
Engineered I-Joists — LF
     133       110       132       124       108       136       373       370       134       504  
Engineered Solid Section — CF
     11       9       10       11       10       11       31       31       10       42  
Cellulose Fiber and White Papers (thousands):
                                                                                
Pulp — air-dry metric tons
     621       619       614       636       663       652       1,898       1,907       639       2,546  
Paper — tons (2)
     763       743       752       736       765       766       2,280       2,245       761       3,006  
Coated groundwood — tons
     55       55       59       61       60       62       174       178       62       240  
Liquid packaging board — tons
     60       61       64       67       69       71       193       199       67       266  
Paper converting — tons
     475       460       487       442       483       471       1,445       1,373       465       1,838  
Containerboard, Packaging and Recycling (thousands):
                                                                                
Containerboard — tons (3)
     1,503       1,503       1,581       1,598       1,597       1,604       4,681       4,705       1,586       6,291  
Packaging — MSF
     18,628       19,493       19,915       20,208       19,416       19,473       57,959       59,174       18,648       77,822  
Recycling — tons (4)
     1,624       1,607       1,673       1,707       1,716       1,703       5,013       5,017       1,701       6,718  
Kraft bags and sacks — tons
     23       24       22       23       21       23       66       70       24       94  
 
(1)   Veneer production represents lathe production and includes volumes that are further processed into plywood and engineered lumber products by company mills.
 
(2)   Paper production includes unprocessed rolls and converted paper volumes.
 
(3)   Containerboard production represents machine production and includes volumes that are further processed into packaging and kraft bags and sacks by company facilities.
 
(4)   Recycling production includes volumes processed in Weyerhaeuser recycling facilities that are consumed by company facilities and brokered volumes.
PRELIMINARY RESULTS — SUBJECT TO AUDIT

 

Table of Contents

WEYERHAEUSER COMPANY
STATISTICAL INFORMATION
CONDENSED CONSOLIDATED BALANCE SHEET (unaudited)
(in millions)
                                                                                 
    March 27,             June 26,             Sept. 25,                                     Dec. 26,  
    2005             2005             2005                                     2004  
Assets
                                                                                
Weyerhaeuser
                                                                                
Current assets:
                                                                                
Cash and short-term investments
   $ 402             $ 1,704             $ 885                                     $ 1,044  
Receivables, less allowances
     1,840               2,008               1,966                                       1,558  
Inventories
     2,122               2,018               1,992                                       1,891  
Prepaid expenses
     634               612               581                                       592  
Assets of business held for sale
     1,119               —               —                                       1,129  
 
                                                                        
Total current assets
     6,117               6,342               5,424                                       6,214  
Property and equipment
     11,447               11,175               11,093                                       11,672  
Construction in progress
     324               451               544                                       268  
Timber and timberlands at cost, less fee stumpage charged to disposals
     3,712               3,709               3,690                                       3,733  
Investments in and advances to equity affiliates
     491               495               496                                       489  
Goodwill
     2,997               2,977               2,989                                       2,996  
Deferred pension and other assets
     1,197               1,249               1,309                                       1,201  
Restricted assets held by special purpose entities
   914             916             914                                     909  
 
     27,199               27,314               26,459                                       27,482  
 
                                                                        
Real Estate and Related Assets
                                                                                
Cash and short-term investments
     5               11               4                                       153  
Receivables, less allowances
     60               57               49                                       43  
Real estate and land for sale and development
     2,083               2,333               2,288                                       1,947  
Other assets
     323               278               357                                       329  
 
     2,471               2,679               2,698                                       2,472  
 
                                                                        
Total assets
   $ 29,670             $ 29,993             $ 29,157                                     $ 29,954  
 
                                                                        
Liabilities and Shareholders’ Interest
                                                                                
Weyerhaeuser
                                                                                
Current liabilities:
                                                                                
Notes payable and commercial paper
   $ 2             $ 2             $ 3                                     $ 3  
Current maturities of long-term debt
     96               225               182                                       489  
Accounts payable
     1,150               1,225               1,167                                       1,159  
Accrued liabilities
     1,313               1,655               1,562                                       1,432  
Liabilities of business held for sale
     308               —               —                                       297  
 
                                                                        
Total current liabilities
     2,869               3,107               2,914                                       3,380  
Long-term debt
     9,263               8,926               8,010                                       9,277  
Deferred income taxes
     4,315               4,320               4,396                                       4,312  
Deferred pension, other postretirement benefits and other liabilities
     1,494               1,560               1,585                                       1,500  
Liabilities not owned, consolidated under FIN 46R
   820             784             783                                     815  
 
     18,761               18,697               17,688                                       19,284  
 
                                                                        
Real Estate and Related Assets
                                                                                
Notes payable and commercial paper
     2               5               3                                       2  
Long-term debt
     869               854               852                                       867  
Other liabilities
   533             588             488                                     546  
 
     1,404               1,447               1,343                                       1,415  
 
                                                                        
Total liabilities
     20,165               20,144               19,031                                       20,699  
Shareholders’ interest
     9,505               9,849               10,126                                       9,255  
 
                                                                        
Total liabilities and shareholders’ interest
   $ 29,670             $ 29,993             $ 29,157                                     $ 29,954  
 
                                                                        
                                                                                 
STATEMENT OF CASH FLOWS   Q1     Q2     Q3     Year-to-date     Q4     Year-to-date  
SELECTED INFORMATION (unaudited)   March 27,     March 28,     June 26,     June 27,     Sept. 25,     Sept. 26,     Sept. 25,     Sept. 26,     Dec. 26,     Dec. 26,  
(in millions)
   2005     2004     2005     2004     2005     2004     2005     2004     2004     2004  
(Weyerhaeuser only, excludes Real Estate & Related Assets)
                                                                                
Net cash from operations
   $ (203 )   $ (89 )   $ 713     $ 787     $ 441     $ 592     $ 951     $ 1,290     $ 745     $ 2,035  
Cash paid for property and equipment
     (117 )     (79 )     (196 )     (80 )     (220 )     (93 )     (533 )     (252 )     (222 )     (474 )
Cash paid for timberlands reforestation
     (12 )     (12 )     (6 )     (6 )     (6 )     (5 )     (24 )     (23 )     (7 )     (30 )
Cash received from issuances of debt
     —       —       1       —       —       —       1       —       1       1  
Revolving credit facilities, notes and commercial paper borrowings, net
     19       67       23       (80 )     (40 )     (6 )     2       (19 )     35       16  
Payments on debt
     (404 )     (60 )     (206 )     (813 )     (965 )     (253 )     (1,575 )     (1,126 )     (742 )     (1,868 )
Proceeds from equity offering
     —       —       —       954       —       —       —       954       —       954  
Proceeds from the sale of BC Coastal operations
     —       —       1,107       —       —       —       1,107       —       —       —  
PRELIMINARY RESULTS — SUBJECT TO AUDIT

 

Table of Contents

SIGNATURES
     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
         
 
      WEYERHAEUSER COMPANY
 
        
 
      By /s/ Steven J. Hillyard
 
       
 
      Its: Vice President and
 
      Chief Accounting Officer
Date: October 21, 2005