Business Wire | Oct 25, 2021 04:10PM EDT

PotlatchDeltic Corporation Reports Third Quarter 2021 Results

Oct. 25, 2021

SPOKANE, Wash.--(BUSINESS WIRE)--Oct. 25, 2021--PotlatchDeltic Corporation (Nasdaq: PCH) today reported net income of $65.7 million, or $0.97 per diluted share, on revenues of $287.3 million for the quarter ended September 30, 2021. Excluding a net gain on insurance recoveries, Adjusted Net Income was $62.4 million, or $0.92 per diluted share for the third quarter of 2021. Net income was $81.0 million, or $1.20 per diluted share, on revenues of $313.0 million for the quarter ended September 30, 2020.

Third Quarter 2021 Highlights

* Generated Total Adjusted EBITDDA of $107.2 million and Total Adjusted EBITDDA margin of 37% * Lumber prices bottomed at a high level and have increased eight weeks in a row * Expanded strong liquidity position to $972 million as of Q3 2021

"While lumber prices declined in the third quarter, they bottomed at a high level and EBITDDA of $107 million was still an excellent quarter for the company," said Eric Cremers, president and chief executive officer. "Looking ahead, lumber prices have continued to increase in the fourth quarter and the outlook on housing fundamentals that drive our business remains positive. Additionally, we continue to expect to pay a special dividend in December and estimate the amount will be $3 to $5 per share," stated Mr. Cremers.

Financial Highlights

($ in millions, except per share data) Q3 2021 Q2 2021 Q3 2020

Revenues $ 287.3 $ 447.5 $ 313.0

Net income $ 65.7 $ 187.9 $ 81.0

Weighted average shares outstanding, 67,648 67,732 67,528 diluted (in thousands)

Net income per diluted share $ 0.97 $ 2.77 $ 1.20



Adjusted Net Income $ 62.4 $ 187.9 $ 81.0

Adjusted Net Income Per Diluted Share $ 0.92 $ 2.77 $ 1.20



Total Adjusted EBITDDA $ 107.2 $ 275.0 $ 135.4

Dividends per share $ 0.41 $ 0.41 $ 0.40

Net cash from operations $ 111.9 $ 171.4 $ 102.9

Cash and cash equivalents $ 592.8 $ 512.0 $ 148.9



Business Performance: Q3 2021 vs. Q2 2021

Timberlands

Third Quarter 2021 Highlights

* Timberlands Adjusted EBITDDA decreased $1.2 million from Q2 2021 record level * Northern and Southern harvest volumes increased seasonally * Northern sawlog prices decreased 22% from historically high prices * Southern sawlog prices increased 10% on wet weather constraining log supply and a higher mix of hardwood volume * Log and haul increased primarily driven by higher mix of Idaho harvest volumes

($ in millions) Q3 2021 Q2 2021 $ Change

Timberlands Revenues $ 129.5 $ 121.2 $ 8.3



Timberlands Adjusted EBITDDA $ 76.0 $ 77.2 $ (1.2 )



Wood Products

Third Quarter 2021 Highlights

* Wood Products Adjusted EBITDDA decreased $178 million from Q2 2021 levels * Average lumber price was $533 per MBF in Q3 2021, 55% lower than Q2 2021 historic prices * Log costs increased due to higher index pricing in Idaho earlier in the year * Inventory at the end of Q3 2021 was written down $6.4 million due to high indexed Idaho log costs

($ in millions) Q3 2021 Q2 2021 $ Change

Wood Products Revenues $ 187.8 $ 357.7 $ (169.9 )



Wood Products Adjusted EBITDDA $ 26.6 $ 204.6 $ (178.0 )



Real Estate

Third Quarter 2021 Highlights

* Real Estate Adjusted EBITDDA decreased $2.7 million from Q2 levels * Reflects lower rural land sale closings, partially offset by an increase in residential lot sales * Sold 2,303 acres of rural land for $3,013/acre * Sold 52 residential lots at an average $81,923/lot

($ in millions) Q3 2021 Q2 2021 $ Change

Real Estate Revenues $ 13.5 $ 16.0 $ (2.5 )



Real Estate Adjusted EBITDDA $ 9.1 $ 11.8 $ (2.7 )



Non-GAAP Measures

This press release includes certain non-GAAP financial measures, which management believes are useful to investors, securities analysts and other interested parties. These non-GAAP financial measures should be considered only as supplemental to, and not as superior to, financial measures prepared in accordance with GAAP.

Management uses Adjusted EBITDDA to evaluate the performance of the company. This is a non-GAAP measure that represents EBITDDA before certain items that impact comparison of the performance of our business either period-over-period or with other businesses.

Adjusted Net Income and Adjusted Net Income Per Diluted Share are non-GAAP measures that represent GAAP net income and GAAP net earnings per diluted share before certain items that impact the ability of investors, securities analysts and other interested parties to compare the performance of our business, either period-over-period or with other businesses.

Reconciliations to GAAP are set forth in the accompanying schedules.

Conference Call Information

A live conference call and webcast will be held Tuesday, October 26, 2021, at 9:00 a.m. Pacific Time (12:00 p.m. Eastern Time). Investors may access the webcast at www.potlatchdeltic.com by clicking on the Investors link or by conference call at 1-888-510-2008 for U.S./Canada and 1-646-960-0306 for international callers. Participants will be asked to provide conference I.D. number 7281983. Supplemental materials that will be discussed during the call are available on the website.

A replay of the conference call will be available two hours following the call until November 3, 2021 by calling 1-800-770-2030 for U.S./Canada or 1-647-362-9199 for international callers. Callers must enter conference I.D. number 7281983 to access the replay.

About PotlatchDeltic

PotlatchDeltic (Nasdaq: PCH) is a leading Real Estate Investment Trust (REIT) that owns approximately 1.8 million acres of timberlands in Alabama, Arkansas, Idaho, Louisiana, Minnesota and Mississippi. Through its taxable REIT subsidiary, the company also operates six sawmills, an industrial-grade plywood mill, a residential and commercial real estate development business and a rural timberland sales program. PotlatchDeltic, a leader in sustainable forest management, is committed to environmental and social responsibility and to responsible governance. More information can be found at www.potlatchdeltic.com.

Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 as amended, including without limitation, our expectations regarding the company's revenues, costs and expenses; expected liquidity; the success of the company's business strategies; the effect of the company's debt refinancing and intent to refinance debt maturing in the future; the company's capital allocation strategies, including share repurchases and dividend expectations; interest in accretive acquisitions; maintaining the company's investment grade credit rating; favorable capital structure and strong balance sheet; interest rates and expenses; corporate expenses; pension expenses; taxes; Q4 and FY 2021 outlook; the housing market and repair and remodel market; housing starts; lumber supply, demand and pricing; lumber shipment volumes; the effects of changes in lumber prices on annual EBITDDA; estimated impact from the Ola, Arkansas sawmill fire and anticipated insurance coverage; expected sawlog demand and timber harvest volumes; sawlog mix and pricing; rural real estate and development real estate sales; land basis and average price per acre and per developed lot; planned capital expenditures; number of seedlings planted; amount of greenhouse gas emitted; amount of CO2e sequestered; safety performance; planned ESG and carbon reports; business conditions; and similar matters. Words such as "anticipate," "expect," "will," "intend," "plan," "target," "project," "believe," "seek," "schedule," "estimate," "could," "can," "may," and similar expressions are intended to identify such forward-looking statements. You should carefully read forward-looking statements, including statements that contain these words, because they discuss the future expectations or state other "forward-looking" information about PotlatchDeltic. A number of important factors could cause actual results or events to differ materially from those indicated by such forward-looking statements, many of which are beyond PotlatchDeltic's control, including the impact of COVID-19 and its variants, governmental responses to such outbreaks, and anticipated recovery from the pandemic on our business, suppliers, customers and employees; changes in the U.S. housing market; changes in timberland values; changes in timber harvest levels on the company's lands; changes in timber prices; changes in policy regarding governmental timber sales; availability of logging contractors and shipping capacity; changes in the United States and international economies and effects on our customers and suppliers; changes in interest rates; credit availability and homebuyers' ability to qualify for mortgages; availability of labor and developable land; changes in the level of construction and remodeling activity; changes in foreign demand; changes in tariffs, quotas and trade agreements involving wood products; currency fluctuation; changes in demand for our products and real estate; changes in production and production capacity in the forest products industry; competitive pricing pressures for our products; unanticipated manufacturing disruptions; disruptions or inefficiencies in our supply chain and/or operations; changes in general and industry-specific environmental laws and regulations; unforeseen environmental liabilities or expenditures; weather conditions; fires at our facilities and on our timberland and other catastrophic events; restrictions on harvesting due to fire danger; changes in raw material, fuel and other costs; transportation disruptions; share price; the successful execution of the company's strategic plans; the company's ability to meet expectations; and the other factors described in PotlatchDeltic's Annual Report on Form 10-K and in the company's other filings with the SEC. PotlatchDeltic assumes no obligation to update the information in this communication, except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements, all of which speak only as of the date hereof.

PotlatchDeltic Corporation

Condensed Consolidated Statements of Operations

Unaudited

Three Months Ended Nine Months Ended

September June 30, September September 30, September 30, 30, 30,

(in thousands,except per 2021 2021 2020 2021 2020share amounts)

Revenues $ 287,330 $ 447,506 $ 313,046 $ 1,089,029 $ 703,481

Costs and expenses:

Cost of goods 190,602 177,779 182,039 537,683 503,921 sold

Selling,general and 18,512 19,512 21,046 54,782 52,064 administrativeexpenses

Net gain oninsurance (4,394 ) - - (4,394 ) - recoveries

204,720 197,291 203,085 588,071 555,985

Operating 82,610 250,215 109,961 500,958 147,496 income

Interest (8,641 ) (8,199 ) (8,557 ) (20,414 ) (20,594 )expense, net

Pensionsettlement - - - - (42,988 )charge

Non-operatingpension andother (3,271 ) (3,271 ) (3,557 ) (9,956 ) (10,670 )postretirementemployeebenefit costs

Income before 70,698 238,745 97,847 470,588 73,244 income taxes

Income taxes (5,031 ) (50,840 ) (16,840 ) (85,910 ) (6,431 )

Net income $ 65,667 $ 187,905 $ 81,007 $ 384,678 $ 66,813



Net income per share:

Basic $ 0.98 $ 2.79 $ 1.21 $ 5.72 $ 0.99

Diluted $ 0.97 $ 2.77 $ 1.20 $ 5.69 $ 0.99

Dividends per $ 0.41 $ 0.41 $ 0.40 $ 1.23 $ 1.20 share

Weighted-average shares outstanding:

Basic 67,315 67,316 67,149 67,275 67,263

Diluted 67,648 67,732 67,528 67,588 67,535



PotlatchDeltic Corporation

Condensed Consolidated Balance Sheets

Unaudited

(in thousands, except per share amounts)

September 30, 2021

December 31, 2020

ASSETS

Current assets:

Cash and cash equivalents

$

592,767

$

252,340

Customer receivables, net

27,789

26,606

Inventories, net

69,862

62,036

Other current assets

24,460

16,136

Total current assets

714,878

357,118

Property, plant and equipment, net

286,034

288,544

Investment in real estate held for development and sale

65,048

72,355

Timber and timberlands, net

1,572,475

1,600,061

Intangible assets, net

15,685

16,270

Other long-term assets

63,747

46,717

Total assets

$

2,717,867

$

2,381,065

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued liabilities

$

87,819

$

93,279

Current portion of long-term debt

42,996

39,981

Current portion of pension and other postretirement employee benefits

6,574

6,574

Total current liabilities

137,389

139,834

Long-term debt

715,122

717,366

Pension and other postretirement employee benefits

126,154

128,807

Deferred tax liabilities, net

26,247

17,740

Other long-term obligations

52,849

72,365

Total liabilities

1,057,761

1,076,112

Commitments and contingencies

Stockholders' equity:

Common stock, $1 par value, authorized 100,000 shares, issued and outstanding 67,100 and 66,876 shares

67,100

66,876

Additional paid-in capital

1,679,332

1,674,576

Accumulated deficit

(13,561

)

(315,510

)

Accumulated other comprehensive loss

(72,765

)

(120,989

)

Total stockholders' equity

1,660,106

1,304,953

Total liabilities and stockholders' equity

$

2,717,867

$

2,381,065

PotlatchDeltic Corporation

Condensed Consolidated Balance Sheets

Unaudited

(in thousands, except per share amounts) September 30, December 31, 2021 2020

ASSETS

Current assets:

Cash and cash equivalents $ 592,767 $ 252,340

Customer receivables, net 27,789 26,606

Inventories, net 69,862 62,036

Other current assets 24,460 16,136

Total current assets 714,878 357,118

Property, plant and equipment, net 286,034 288,544

Investment in real estate held for development 65,048 72,355 and sale

Timber and timberlands, net 1,572,475 1,600,061

Intangible assets, net 15,685 16,270

Other long-term assets 63,747 46,717

Total assets $ 2,717,867 $ 2,381,065



LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued liabilities $ 87,819 $ 93,279

Current portion of long-term debt 42,996 39,981

Current portion of pension and other 6,574 6,574 postretirement employee benefits

Total current liabilities 137,389 139,834

Long-term debt 715,122 717,366

Pension and other postretirement employee 126,154 128,807 benefits

Deferred tax liabilities, net 26,247 17,740

Other long-term obligations 52,849 72,365

Total liabilities 1,057,761 1,076,112

Commitments and contingencies

Stockholders' equity:

Common stock, $1 par value, authorized 100,000shares, issued and outstanding 67,100 and 67,100 66,876 66,876 shares

Additional paid-in capital 1,679,332 1,674,576

Accumulated deficit (13,561 ) (315,510 )

Accumulated other comprehensive loss (72,765 ) (120,989 )

Total stockholders' equity 1,660,106 1,304,953

Total liabilities and stockholders' equity $ 2,717,867 $ 2,381,065



PotlatchDeltic Corporation

Condensed Consolidated Statements of Cash Flows

Unaudited

Three Months Ended

Nine Months Ended

(in thousands)

September 30, 2021

June 30, 2021

September 30, 2020

September 30, 2021

September 30, 2020

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

65,667

$

187,905

$

81,007

$

384,678

$

66,813

Adjustments:

Depreciation, depletion and amortization

21,534

17,432

20,594

57,365

57,809

Basis of real estate sold

6,697

7,213

5,249

22,733

14,440

Change in deferred taxes

2,659

(928

)

(538

)

3,221

(14,387

)

Pension and other postretirement employee benefits

5,484

5,484

5,917

16,595

17,750

Pension settlement charge

-

-

-

-

42,988

Equity-based compensation expense

2,275

2,140

2,063

6,345

5,928

Net gain on insurance recoveries

(4,394

)

-

-

(4,394

)

Other, net

928

92

(367

)

633

(544

)

Change in working capital and operating-related activities, net

17,072

(43,867

)

(3,691

)

(20,082

)

12,706

Real estate development expenditures

(2,435

)

(1,684

)

(1,713

)

(6,434

)

(4,200

)

Funding of pension and other postretirement employee benefits

(3,585

)

(2,412

)

(5,619

)

(7,418

)

(8,458

)

Net cash provided by operating activities

111,902

171,375

102,902

453,242

190,845

CASH FLOWS FROM INVESTING ACTIVITIES

Property, plant and equipment additions

(10,348

)

(8,181

)

(4,371

)

(26,291

)

(14,666

)

Timberlands reforestation and roads

(4,282

)

(3,998

)

(4,569

)

(12,236

)

(12,345

)

Acquisition of timber and timberlands

(258

)

(2,192

)

(8

)

(2,450

)

(4,738

)

Proceeds from insurance recoveries - property, plant & equipment

13,250

-

-

13,250

-

Other, net

358

446

371

993

3,484

Net cash used in investing activities

(1,280

)

(13,925

)

(8,577

)

(26,734

)

(28,265

)

CASH FLOWS FROM FINANCING ACTIVITIES

Distributions to common stockholders

(27,489

)

(27,489

)

(26,749

)

(82,462

)

(80,434

)

Repurchase of common stock

-

-

-

-

(15,364

)

Other, net

(2,396

)

(632

)

(506

)

(3,619

)

(1,032

)

Net cash used in financing activities

(29,885

)

(28,121

)

(27,255

)

(86,081

)

(96,830

)

Change in cash, cash equivalents and restricted cash

80,737

129,329

67,070

340,427

65,750

Cash, cash equivalents and restricted cash, beginning

512,030

382,701

82,934

252,340

84,254

Cash, cash equivalents and restricted cash, ending

$

592,767

$

512,030

$

150,004

$

592,767

$

150,004

PotlatchDeltic Corporation

Condensed Consolidated Statements of Cash Flows

Unaudited

Three Months Ended Nine Months Ended

(in thousands) September June 30, September September September 30, 2021 2021 30, 2020 30, 2021 30, 2020

CASH FLOWS FROMOPERATING ACTIVITIES

Net income $ 65,667 $ 187,905 $ 81,007 $ 384,678 $ 66,813

Adjustments:

Depreciation,depletion and 21,534 17,432 20,594 57,365 57,809 amortization

Basis of real 6,697 7,213 5,249 22,733 14,440 estate sold

Change in 2,659 (928 ) (538 ) 3,221 (14,387 )deferred taxes

Pension and otherpostretirement 5,484 5,484 5,917 16,595 17,750 employee benefits

Pension - - - - 42,988 settlement charge

Equity-basedcompensation 2,275 2,140 2,063 6,345 5,928 expense

Net gain oninsurance (4,394 ) - - (4,394 ) recoveries

Other, net 928 92 (367 ) 633 (544 )

Change in workingcapital and 17,072 (43,867 ) (3,691 ) (20,082 ) 12,706 operating-relatedactivities, net

Real estatedevelopment (2,435 ) (1,684 ) (1,713 ) (6,434 ) (4,200 )expenditures

Funding ofpension and other (3,585 ) (2,412 ) (5,619 ) (7,418 ) (8,458 )postretirementemployee benefits

Net cash providedby operating 111,902 171,375 102,902 453,242 190,845 activities



CASH FLOWS FROMINVESTING ACTIVITIES

Property, plantand equipment (10,348 ) (8,181 ) (4,371 ) (26,291 ) (14,666 )additions

Timberlandsreforestation and (4,282 ) (3,998 ) (4,569 ) (12,236 ) (12,345 )roads

Acquisition oftimber and (258 ) (2,192 ) (8 ) (2,450 ) (4,738 )timberlands

Proceeds frominsurancerecoveries - 13,250 - - 13,250 - property, plant &equipment

Other, net 358 446 371 993 3,484

Net cash used ininvesting (1,280 ) (13,925 ) (8,577 ) (26,734 ) (28,265 )activities



CASH FLOWS FROMFINANCING ACTIVITIES

Distributions tocommon (27,489 ) (27,489 ) (26,749 ) (82,462 ) (80,434 )stockholders

Repurchase of - - - - (15,364 )common stock

Other, net (2,396 ) (632 ) (506 ) (3,619 ) (1,032 )

Net cash used infinancing (29,885 ) (28,121 ) (27,255 ) (86,081 ) (96,830 )activities

Change in cash,cash equivalents 80,737 129,329 67,070 340,427 65,750 and restrictedcash

Cash, cashequivalents and 512,030 382,701 82,934 252,340 84,254 restricted cash,beginning

Cash, cashequivalents and $ 592,767 $ 512,030 $ 150,004 $ 592,767 $ 150,004 restricted cash,ending



PotlatchDeltic Corporation

Segment Information

Unaudited

Three Months Ended

Nine Months Ended

September 30,

June 30,

September 30,

September 30,

September 30,

(in thousands)

2021

2021

2020

2021

2020

Revenues

Timberlands

$

129,543

$

121,216

$

116,985

$

362,675

$

266,755

Wood Products

187,760

357,673

218,291

814,729

489,507

Real Estate

13,497

15,998

18,151

49,808

42,225

330,800

494,887

353,427

1,227,212

798,487

Intersegment Timberlands revenues

(43,470

)

(47,381

)

(40,381

)

(138,183

)

(95,006

)

Consolidated revenues

$

287,330

$

447,506

$

313,046

$

1,089,029

$

703,481

Adjusted EBITDDA1

Timberlands

$

76,023

$

77,259

$

59,649

$

221,140

$

120,290

Wood Products

26,566

204,533

81,644

356,654

105,780

Real Estate

9,069

11,788

13,466

37,450

30,062

Corporate

(11,496

)

(12,822

)

(15,361

)

(35,028

)

(34,567

)

Eliminations and adjustments

7,021

(5,774

)

(4,012

)

(3,063

)

(3,235

)

Total Adjusted EBITDDA

107,183

274,984

135,386

577,153

218,330

Interest expense, net

(8,641

)

(8,199

)

(8,557

)

(20,414

)

(20,594

)

Depreciation, depletion and amortization

(21,131

)

(17,029

)

(20,187

)

(56,156

)

(56,590

)

Basis of real estate sold

(6,697

)

(7,213

)

(5,249

)

(22,733

)

(14,440

)

Net gain on insurance recoveries

4,394

-

-

4,394

-

Pension settlement charge

-

-

-

-

(42,988

)

Non-operating pension and other postretirement employee benefits

(3,271

)

(3,271

)

(3,557

)

(9,956

)

(10,670

)

(Loss) gain on disposal of fixed assets

(1,139

)

(527

)

11

(1,700

)

196

Income before income taxes

$

70,698

$

238,745

$

97,847

$

470,588

$

73,244

Depreciation, depletion and amortization

Timberlands

$

11,893

$

10,482

$

13,821

$

33,792

$

37,978

Wood Products

8,879

6,179

5,983

21,261

17,411

Real Estate

162

160

149

477

465

Corporate

197

208

234

626

736

21,131

17,029

20,187

56,156

56,590

Bond discounts and deferred loan fees2

403

403

407

1,209

1,219

Total depreciation, depletion and amortization

$

21,534

$

17,432

$

20,594

$

57,365

$

57,809

Basis of real estate sold

Real Estate

$

6,703

$

7,219

$

5,257

$

22,751

$

14,973

Eliminations and adjustments

(6

)

(6

)

(8

)

(18

)

(533

)

Total basis of real estate sold

$

6,697

$

7,213

$

5,249

$

22,733

$

14,440

* Management uses Adjusted EBITDDA to evaluate company and segment performance. See the reconciliation of Total Adjusted EBITDDA below. * Bond discounts and deferred loan fees are included in interest expense, net in the Condensed Consolidated Statements of Operations.PotlatchDeltic Corporation

Segment Information

Unaudited

Three Months Ended Nine Months Ended

September June 30, September September 30, September 30, 30, 30,

(in thousands) 2021 2021 2020 2021 2020

Revenues

Timberlands $ 129,543 $ 121,216 $ 116,985 $ 362,675 $ 266,755

Wood Products 187,760 357,673 218,291 814,729 489,507

Real Estate 13,497 15,998 18,151 49,808 42,225

330,800 494,887 353,427 1,227,212 798,487

IntersegmentTimberlands (43,470 ) (47,381 ) (40,381 ) (138,183 ) (95,006 )revenues

Consolidated $ 287,330 $ 447,506 $ 313,046 $ 1,089,029 $ 703,481 revenues



Adjusted EBITDDA^1

Timberlands $ 76,023 $ 77,259 $ 59,649 $ 221,140 $ 120,290

Wood Products 26,566 204,533 81,644 356,654 105,780

Real Estate 9,069 11,788 13,466 37,450 30,062

Corporate (11,496 ) (12,822 ) (15,361 ) (35,028 ) (34,567 )

Eliminationsand 7,021 (5,774 ) (4,012 ) (3,063 ) (3,235 )adjustments

Total Adjusted 107,183 274,984 135,386 577,153 218,330 EBITDDA

Interest (8,641 ) (8,199 ) (8,557 ) (20,414 ) (20,594 )expense, net

Depreciation,depletion and (21,131 ) (17,029 ) (20,187 ) (56,156 ) (56,590 )amortization

Basis of real (6,697 ) (7,213 ) (5,249 ) (22,733 ) (14,440 )estate sold

Net gain oninsurance 4,394 - - 4,394 - recoveries

Pensionsettlement - - - - (42,988 )charge

Non-operatingpension andother (3,271 ) (3,271 ) (3,557 ) (9,956 ) (10,670 )postretirementemployeebenefits

(Loss) gain ondisposal of (1,139 ) (527 ) 11 (1,700 ) 196 fixed assets

Income before $ 70,698 $ 238,745 $ 97,847 $ 470,588 $ 73,244 income taxes



Depreciation,depletion and amortization

Timberlands $ 11,893 $ 10,482 $ 13,821 $ 33,792 $ 37,978

Wood Products 8,879 6,179 5,983 21,261 17,411

Real Estate 162 160 149 477 465

Corporate 197 208 234 626 736

21,131 17,029 20,187 56,156 56,590

Bond discountsand deferred 403 403 407 1,209 1,219 loan fees^2

Totaldepreciation, $ 21,534 $ 17,432 $ 20,594 $ 57,365 $ 57,809 depletion andamortization



Basis of real estate sold

Real Estate $ 6,703 $ 7,219 $ 5,257 $ 22,751 $ 14,973

Eliminationsand (6 ) (6 ) (8 ) (18 ) (533 )adjustments

Total basis ofreal estate $ 6,697 $ 7,213 $ 5,249 $ 22,733 $ 14,440 sold



* Management uses Adjusted EBITDDA to evaluate company and segment performance. See the reconciliation of Total Adjusted EBITDDA below. * Bond discounts and deferred loan fees are included in interest expense, net in the Condensed Consolidated Statements of Operations.PotlatchDeltic Corporation

Reconciliations

Unaudited

Three Months Ended Nine Months Ended

September June 30, September September September 30, 30, 30, 30,

(in thousands,except per 2021 2021 2020 2021 2020share amount)

Total Adjusted EBITDDA

Net income $ 65,667 $ 187,905 $ 81,007 $ 384,678 $ 66,813 (GAAP)

Interest 8,641 8,199 8,557 20,414 20,594 expense, net

Income taxes 5,031 50,840 16,840 85,910 6,431

Depreciation,depletion and 21,131 17,029 20,187 56,156 56,590 amortization

Basis of real 6,697 7,213 5,249 22,733 14,440 estate sold

Net gain oninsurance (4,394 ) - - (4,394 ) - recoveries

Pensionsettlement - - - - 42,988 charge

Non-operatingpension andother 3,271 3,271 3,557 9,956 10,670 postretirementbenefit costs

Loss (gain) ondisposal of 1,139 527 (11 ) 1,700 (196 )fixed assets

Total Adjusted $ 107,183 $ 274,984 $ 135,386 $ 577,153 $ 218,330 EBITDDA



Adjusted Net Income

Net income $ 65,667 $ 187,905 $ 81,007 $ 384,678 $ 66,813 (GAAP)

Special items:

Net gain oninsurance (3,252 ) - - (3,252 ) - recoveries,after tax

Pensionsettlement - - - - 31,811 charge, aftertax

Adjusted Net $ 62,415 $ 187,905 $ 81,007 $ 381,426 $ 98,624 Income



Adjusted NetIncome Per Diluted Share

Net income perdiluted share $ 0.97 $ 2.77 $ 1.20 $ 5.69 $ 0.99 (GAAP)

Special items:

Net gain oninsurance (0.05 ) - - (0.05 ) - recoveries,after tax

Pensionsettlement - - - - 0.47 charge, aftertax

Adjusted NetIncome Per $ 0.92 $ 2.77 $ 1.20 $ 5.64 $ 1.46 Diluted Share



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