What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2022-11-04 compared with 2022-08-05 · 213 added, 168 removed, 632 unchanged (38% of the section changed)

32 unchanged sentences

Southern Timber, Pacific Northwest Timber, New Zealand Timber, Real Estate, and Trading.

As of June 30, 2022, we owned or leased under long-term agreem ents approximat ely 2.7 million acres of timberlands located in the U.S.

As of September 30, 2022, we owned or leased under long-term agreements approximately 2.7 million acres of timberlands located in the U.S.

South (1.79 million acres), U.S.

26 unchanged sentences

dollar terms.

Global log and lumber markets were volatile during the first and second quarters as sanctions were placed on Russia in response to their invasion of Ukraine.

During 2022, global log and lumber markets have experienced increased volatility due in part to Russia’s invasion of Ukraine and subsequent sanctions placed on Russia.

While we do not expect our operations to be directly impacted by the conflict at this time, changes in global wood and commodity flows could impact the markets in which we operate.

As the current COVID-19 pandemic continues to evolve, the expected duration and the extent of economic disruption it may ultimately cause remain uncertain.

As the current COVID-19 pandemic continues to evolve, the expected duration and extent of economic disruption resulting from the pandemic remain uncertain.

Local, state and national governments continue to evaluate policies and restrictions in order to mitigate the spread of COVID-19.

6 unchanged sentences

Other costs include amortization of capitalized costs related to road and bridge construction and software, depreciation of fixed assets and equipment, road maintenance, severance and excise taxes, fire prevention and real estate commissions and closing costs.

Our Real Estate segment is impacted by changes in interest and mortgage rates.

Recent increases in the federal funds interest rate by the U.S.

Federal Reserve and the corresponding impact on mortgage rates will likely impact the affordability of the properties we sell.

As a result, we expect that demand for our rural and development real estate properties could moderate if interest rates remain elevated or increase further.

For additional information on market conditions impacting our business, see Results of Operations .

CRITICAL ACCOUNTING POLICIES AND USE OF ESTIMATES

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements requires us to make estimates, assumptions and judgments that affect our assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities.

7 unchanged sentences

Southern Timber, Pacific Northwest Timber and New Zealand Timber.

The following tables provide a breakdown of our timberland holdings as of June 30, 2022 and December 31, 2021:

(acres in 000s) As of June 30, 2022

The following tables provide a breakdown of our timberland holdings as of September 30, 2022 and December 31, 2021:

(acres in 000s) As of September 30, 2022

As of December 31, 2021

16 unchanged sentences

(a) Represents legal acres owned and leased by the New Zealand subsidiary, in which we own a 77% interest.

As of June 30, 2022, legal acres in New Zealand consisted of 296,000 plantable acres and 122,000 non-productive acres.

The following tables detail activity for owned and leased acres in our timberland holdings by state from December 31, 2021 to June 30, 2022:

As of September 30, 2022, legal acres in New Zealand consisted of 297,000 plantable acres and 120,000 non-productive acres.

The following tables detail activity for owned and leased acres in our timberland holdings by state from December 31, 2021 to September 30, 2022:

(acres in 000s) Acres Owned

December 31, 2021

Acquisitions Sales Other June 30, 2022

Acquisitions Sales Other September 30, 2022

Alabama 223 1 (1) — 223

15 unchanged sentences

December 31, 2021

New Leases Sold/Expired Leases (a) Other June 30, 2022

New Leases Sold/Expired Leases (a) Other September 30, 2022

Alabama 14 — — — 14

14 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Financial Information (in millions) 2022 2021 2022 2021

2 unchanged sentences

New Zealand Timber 72.5 75.6 202.7 213.7

Timber Funds — 18.6 — 33.6

Timber Funds (a) — 94.5 — 128.1

Improved Development 2.3 27.8 18.8 47.4

Unimproved Development — 37.5 — 37.5

Rural 7.0 6.9 47.3 37.0

1 unchanged sentence

Conservation Easement — — — 3.9

Deferred Revenue/Other (a) (0.6) (5.0) 0.3 (4.5)

Deferred Revenue/Other (b) 3.2 1.1 3.5 (3.4)

Large Dispositions — 20.0 — 56.0

7 unchanged sentences

New Zealand Timber 9.3 13.3 22.7 48.0

Timber Funds — 2.0 — 3.5

Real Estate (a)(b) 11.0 50.5 21.2 52.2

Timber Funds (a) — 41.3 — 44.8

Real Estate (b)(c) 15.7 60.6 37.0 112.8

Trading 0.2 — 0.1 0.6

4 unchanged sentences

Net Income 31.9 110.5 88.1 189.0

Net income attributable to noncontrolling interests in consolidated affiliates (0.6) (4.5) (1.7) (8.3)

Net income attributable to noncontrolling interests in consolidated affiliates (d) (10.8) (32.5) (12.4) (40.8)

Net Income Attributable to Rayonier, L.P.

3 unchanged sentences

$20.6 $75.8 $74.0 $143.9

Adjusted EBITDA (c)

Adjusted EBITDA (e)

Southern Timber $36.6 $24.4 $123.7 $86.6

6 unchanged sentences

Total Adjusted EBITDA $64.7 $114.6 $245.8 $279.4

(a) Includes deferred revenue adjustments, revenue true-ups and marketing fees related to Improved Development sales in addition to residential and commercial lease revenue.

(b) The three and six months ended June 30, 2021 includes $30.3 million from a Large Disposition.

(a) The three and nine months ended September 30, 2021 includes sales and operating income of $87.1 million and $36.0 million, respectively, from Fund II Timberland Dispositions.

(b) Includes deferred revenue adjustments, revenue true-ups and marketing fees related to Improved Development sales in addition to residential and commercial lease revenue.

(c) The three and nine months ended September 30, 2022 includes $16.0 million of equity income related to the multi-family apartment complex sale in Bainbridge Island, Washington.

The three and nine months ended September 30, 2021 includes $14.5 million and $44.8 million, respectively, from Large Dispositions.

(d) The three and nine months ended September 30, 2021 includes a $28.8 million gain from Fund II Timberland Dispositions.

(e) Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators .

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Southern Timber Overview 2022 2021 2022 2021

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Pacific Northwest Timber Overview 2022 2021 2022 2021

21 unchanged sentences

Operating Income $2.2 $2.1 $11.7 $5.3

(+) Timber write-offs resulting from a casualty event (b) 1.1 — 1.1 —

(+) Depreciation, depletion and amortization 9.4 10.5 35.6 38.8

Adjusted EBITDA (b) $14.3 $13.9 $35.8 $31.5

Adjusted EBITDA (c) $12.6 $12.5 $48.4 $44.1

Period-End Acres (in thousands) 486 490 486 490

Sawtimber (in dollars per MBF) (c) $905 $750 $873 $740

Sawtimber (in dollars per MBF) (d) $860 $803 $866 $758

(a) Estimated percentage of export volume, which includes volumes sold to third-party exporters in addition to direct exports through our log export program.

(b) Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators .

(b) Timber write-offs resulting from a casualty event include the write-off of merchantable and pre-merchantable timber volume destroyed by casualty events which cannot be salvaged.

(d) Delivered Sawtimber excluding chip-n-saw.

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

New Zealand Timber Overview 2022 2021 2022 2021

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Real Estate Overview 2022 2021 2022 2021

1 unchanged sentence

Improved Development $2.3 $27.8 $18.8 $47.4

Unimproved Development — 37.5 — 37.5

Rural 7.0 6.9 47.3 37.0

5 unchanged sentences

Improved Development 19.0 479.0 95.9 768.8

Unimproved Development — 359 — 359

Rural 1,809 3,260 11,194 13,379

4 unchanged sentences

Improved Development $121,106 $57,988 $196,311 $61,608

Unimproved Development — 104,579 — 104,579

Rural 3,848 2,128 4,228 2,765

7 unchanged sentences

(+) Non-cash cost of land and improved development 3.1 15.8 20.3 22.8

(–) Gain associated with the multi-family apartment complex sale attributable to NCI (e) (11.5) — (11.5) —

(–) Large Dispositions (b) — (14.5) — (44.8)

Adjusted EBITDA (e) $25.4 $29.1 $50.1 $34.1

Adjusted EBITDA (f) $8.4 $63.8 $58.4 $97.9

(a) Includes deferred revenue adjustments, revenue true-ups and marketing fees related to Improved Development sales in addition to residential and commercial lease revenue.

(b) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

In June 2021, we completed the disposition of approximately 9,000 acres located in Washington for a sales price and a gain of approximately $36.0 million and $30.3 million, respectively.

(d) Excludes Improved Development and Large Dispositions.

(e) Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators .

(e) Gain associated with the multi-family apartment complex sale attributable to NCI represents the gain recognized in connection with the sale of property by the Bainbridge Landing joint venture attributable to noncontrolling interests.

(f) Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators .

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Trading Overview 2022 2021 2022 2021

10 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

Capital Expenditures By Segment (in millions of dollars) 2022 2021 2022 2021

27 unchanged sentences

$4.9 $2.9 $10.9 $9.2

(a) The three and six months ended June 30, 2021 exclude $1.2 million and $2.5 million, respectively, of capital expenditures attributable to noncontrolling interests in Timber Funds.

(a) The three and nine months ended September 30, 2021 exclude $0.3 million and $2.8 million, respectively, of capital expenditures attributable to noncontrolling interests in Timber Funds.

(b) Represents investments in master infrastructure or entitlements in our real estate development projects.

Real Estate Development Investments are amortized as the underlying properties are sold and included in Non-Cash Cost of Land and Improved Development.

The following tables summarize sales, operating income (loss) and Adjusted EBITDA variances for June 30, 2022 versus June 30, 2021 (millions of dollars):

The following tables summarize sales, operating income (loss) and Adjusted EBITDA variances for September 30, 2022 versus September 30, 2021 (millions of dollars):

Sales Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Intersegment Eliminations Total

Three Months Ended

June 30, 2021

September 30, 2021

$44.8 $31.5 $75.6 $94.5 $93.4 $25.6 ($0.7) $364.7

5 unchanged sentences

Three Months Ended

June 30, 2022

September 30, 2022

$64.5 $34.4 $72.5 — $12.4 $11.6 ($0.1) $195.3

3 unchanged sentences

(d) Timber Funds segment was liquidated in 2021.

(e) Includes $36.0 million of sales from a Large Disposition in addition to Conservation Easement sales in Q2 2021, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

(e) Includes $20.0 million of sales from a Large Disposition in Q3 2021, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales and deferred adjustments.

(f) Includes a decrease in Intersegment elimina tions related to timberland management fees paid to us by the timber funds and reported as sales within the Timber Funds segment.

Sales Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Intersegment Eliminations Total

Six Months Ended

June 30, 2021

Nine Months Ended

September 30, 2021

$145.8 $108.4 $213.7 $128.1 $178.4 $76.8 ($3.6) $847.6

4 unchanged sentences

Other 19.0 (b) 5.2 (b) 20.0 (c) (128.1) (d) (54.8) (e) — 3.4 (f) (135.2)

Six Months Ended

June 30, 2022

Nine Months Ended

September 30, 2022

$207.6 $119.8 $202.7 — $81.0 $52.7 ($0.2) $663.7

3 unchanged sentences

(d) Timber Funds segment was liquidated in 2021.

(e) Includ es $36.0 million of sales from a Large Disposition in addition to Conservation Easement sales in Q2 2021, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

(e) Includ es $56.0 million of sales from a Large Disposition in addition to Conservation Easement sales in the nine months ended September 30, 2021, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, conservation easement sales and deferred adjustments.

(f) Includes a decrease in Intersegment eliminations related to timberland management fees paid to us by the timber funds and reported as sales within the Timber Funds segment.

Operating Income (Loss) Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate and Other Total

Operating Income Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate and Other Total

Three Months Ended

June 30, 2021

September 30, 2021

$12.8 $2.1 $13.3 $41.3 $60.6 — ($6.7) $123.3

8 unchanged sentences

Three Months Ended

June 30, 2022

September 30, 2022

$22.5 $2.2 $9.3 — $15.7 $0.2 ($9.0) $40.9

4 unchanged sentences

(d) Timber Funds segment was liquidated in 2021.

Real Estate includes $30.3 million of operating income from a Large Disposition in addition to Conservation Easement sales in Q2 2021, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

Operating Income (Loss) Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate and Other Total

Six Months Ended

June 30, 2021

Real Estate includes a Large Disposition in Q3 2021, gain associated with the multi-family apartment complex sale attributable to NCI, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

Pacific Northwest Timber segment includes $1.1 million in timber write-offs resulting from casualty events.

Operating Income Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate and Other Total

Nine Months Ended

September 30, 2021

$47.1 $5.3 $48.0 $44.8 $112.8 $0.6 ($22.3) $236.2

7 unchanged sentences

Other (d) — (1.1) — (44.8) (27.8) — — (73.8)

Six Months Ended

June 30, 2022

Nine Months Ended

September 30, 2022

$76.9 $11.7 $22.7 — $37.0 $0.1 ($26.6) $121.7

4 unchanged sentences

(d) Timber Funds segment was liquidated in 2021.

Real Estate includes a Large Disposition in addition to Conservation Easement sales in the nine months ended September 30, 2021, a gain associated with the multi-family apartment complex sale attributable to NCI, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

Pacific Northwest Timber segment includes $1.1 million in timber write-offs resulting from casualty events.

Adjusted EBITDA (a) Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate and Other Total

Three Months Ended

June 30, 2021

September 30, 2021

$24.4 $12.5 $19.9 $0.5 $63.8 — ($6.4) $114.6

6 unchanged sentences

Three Months Ended

June 30, 2022

September 30, 2022

$36.6 $12.6 $15.6 — $8.4 $0.2 ($8.6) $64.7

5 unchanged sentences

(e) Timber Funds segment was liquidated in 2021.

Real Estate includes Conservation Easement sales in Q2 2021, residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

Real Estate includes residential and commercial lease income, revenue true-ups and marketing fees related to Improved Development sales, equity income from joint venture entities and deferred adjustments.

Adjusted EBITDA (a) Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate and Other Total

Six Months Ended

June 30, 2021

Nine Months Ended

September 30, 2021

$86.6 $44.1 $68.7 $2.8 $97.9 $0.6 ($21.4) $279.4

5 unchanged sentences

Other (e) — — — (2.8) 6.5 — — 3.7

Six Months Ended

June 30, 2022

Nine Months Ended

September 30, 2022

$123.7 $48.4 $40.8 — $58.4 $0.1 ($25.7) $245.8

7 unchanged sentences

SOUTHERN TIMBER

Second quarter sales of $66.3 million increased $17.0 million, or 34%, versus the prior year period.

Harvest volumes increased 4% to 1.52 million tons versus 1.47 million tons in the prior year period , as demand remained strong across the region.

Average pine sawtimber stumpage prices increased 22% to $34.09 per ton versus $27.96 per ton in the prior year period, due to strong domestic lumber demand as well as increased competition for chip-n-saw volume from pulp mills.

Average pine pulpwood stumpage prices rose 18% to $21.46 per ton versus $18.22 per ton in the prior year period.

Despite an unfavorable shift in our geographic mix of pulpwood sales versus the prior year period, robust competition amid strong end-market demand allowed us to capture pulpwood price increases that more than offset the upward pressure on cut and haul costs.

Third quarter sales of $64.5 million increased $19.7 million, or 44%, versus the prior year period.

Harvest volumes increased 27% to 1.50 million tons versus 1.19 million tons in the prior year period , as more favorable weather conditions led to improved production.

Average pine sawtimber stumpage prices increased 19% to $33.31 per ton versus $28.06 per ton in the prior year period, due to continued strong demand from sawmills as well as competition from pulp mills for chip-n-saw volume.

Average pine pulpwood stumpage prices rose 19% to $22.77 per ton versus $19.14 per ton in the prior year period, driven by strong end-market demand and a favorable geographic mix.

Overall, weighted-average stumpage prices (including hardwood) increased 18% to $25.80 per ton versus $21.88 per ton in the prior year period.

Operating income of $24.1 million increased $7.1 million versus the prior year period due to higher net stumpage realizations ($6.0 million), higher non-timber income ($2.4 million) and higher volumes ($0.7 million), partially offset by higher overhead costs ($1.4 million) and higher depletion rates ($0.6 million).

Second quarter Adjusted EBITDA of $38.7 million was 27%, or $8.1 million, above the prior year period.

Operating income of $22.5 million increased $9.7 million versus the prior year period due to higher net stumpage realizations ($5.8 million), higher volumes ($3.8 million), higher non-timber income ($1.3 million), and lower depletion rates ($0.5 million), partially offset by higher overhead and other costs ($1.7 million).

Third quarter Adjusted EBITDA of $36.6 million was 50%, or $12.2 million, above the prior year period.

Year-to-date sales of $207.6 million increased $61.8 million, or 42%, versus the prior year period.

Harvest volumes increased 18% to 4.92 million tons versus 4.17 million in the prior year period, due to strong demand and favorable logging conditions.

Average pine sawtimber stumpage prices increased 26% to $34.86 per ton versus $27.69 per ton in the prior year period, primarily due to robust demand from sawmills given the strength of the domestic lumber market, as well as competition for chip-n-saw volume from pulp mills.

Average pine sawtimber stumpage prices increased 25% to $34.40 per ton versus

$27.62 per ton in the prior year period, primarily due to strong demand from sawmills, as well as competition for chip-n-saw volume from pulp mills.

Average pine pulpwood stumpage prices increased 25% to $22.88 per ton versus $18.25 per ton in the prior year period, driven by strong demand due to low mill inventories at the start of the year and favorable end-market demand.

1 unchanged sentence

Operating income of $76.9 million increased $29.8 million versus the prior year period due to higher net stumpage realizations ($24.4 million), higher volumes ($9.1 million) and higher non-timber income ($1.9 million), partially offset by higher costs ($5.3 million) and higher depletion rates ($0.3 million).

Year-to-date Adjusted EBITDA of $123.7 million was 43%, or $37.1 million, above the prior year period.

PACIFIC NORTHWEST TIMBER

Second quarter sales of $39.2 million increased $3.8 million, or 11%, versus the prior year period, notwithstanding a decline in harvest volumes of 6% to 376,000 tons versus 400,000 tons in the prior year period.

Average delivered sawtimber prices increased 19% to $116.60 per ton versus $97.80 per ton in the prior year period, driven by continued strong demand from domestic lumber mills as well as a favorable species mix, as a higher proportion of Douglas-fir sawtimber was harvested in the current year quarter.

Average delivered pulpwood prices increased 56% to $45.17 per ton versus $29.02 per ton in the prior year period, reflecting strong end- market demand as well as the resumption of chip exports, which resulted in greater competition from pulp mills to secure supply.

Operating income of $2.9 million improved $1.1 million versus the prior year period due to higher net stumpage realizations ($3.0 million), partially offset by higher overhead and other costs ($1.4 million), lower volumes ($0.4 million) and lower non-timber income ($0.2 million).

Second quarter Adjusted EBITDA of $14.3 million was 3%, or $0.4 million, above the prior year period.

Year-to-date sales of $85.4 million increased $8.6 million, or 11%, versus the prior year period, notwithstanding a decline in harvest volumes of 6% to 881,000 tons versus 936,000 tons in the prior year period.

Third quarter sales of $34.4 million increased $2.9 million, or 9%, versus the prior year period, notwithstanding a decline in harvest volumes of 11% to 307,000 tons versus 346,000 tons in the prior year period.

Average delivered sawtimber prices increased 10% to $117.86 per ton versus $107.56 per ton in the prior year period, driven by continued healthy demand from domestic lumber mills as well as a favorable species mix, as a higher proportion of Douglas-fir sawtimber was harvested in the current year quarter.

Average delivered pulpwood prices increased 62% to $50.74 per ton versus $31.34 per ton in the prior year period, reflecting strong end-market demand coupled with supply constraints due to fewer residuals and increased competition for a limited supply of smaller-sized logs.

Operating income of $2.2 million improved $0.1 million versus the prior year period due to higher net stumpage realizations ($1.9 million) and higher non-timber income ($0.5 million), partially offset by the write-off of timber basis due to a fire in Washington ($1.1 million), lower volumes ($0.7 million), and higher overhead and other costs ($0.5 million).

Third quarter Adjusted EBITDA of $12.6 million was 1%, or $0.1 million, above the prior year period.

Year-to-date sales of $119.8 million increased $11.5 million, or 11%, versus the prior year period, notwithstanding a decline in harvest volumes of 7% to 1.19 million tons versus 1.28 million tons in the prior year period.

Average delivered sawtimber prices increased 15% to $112.65 per ton versus $97.79 per ton in the prior year period due to strong domestic lumber demand and a favorable species mix in the current year period.

Average delivered pulpwood prices increased 49% to $44.44 per ton versus $29.86 per ton in the prior year period, driven by strong end-market demand, the restart of previously idled pulp mill capacity, and the resumption of chip exports, which resulted in greater competition from pulp mills to secure supply.

Operating income of $9.5 million improved $6.3 million versus the prior year period due to higher net stumpage realizations ($8.7 million) and lower depletion rates ($0.4 million), partially offset by higher costs ($1.9 million), lower volumes ($0.6 million) and lower non-timber income ($0.3 million).

Operating income of $11.7 million improved $6.4 million versus the prior year period due to higher net stumpage realizations ($10.5 million), lower depletion rates ($0.4 million) and higher non-timber income ($0.2 million), partially offset by higher costs ($2.4 million), lower volumes ($1.2 million) and a write-off of timber basis as a result of a fire in Washington ($1.1 million).

Year-to-date Adjusted EBITDA of $48.4 million was 10%, or $4.3 million, above the prior year period.

NEW ZEALAND TIMBER

Second quarter sales of $78.9 million decreased $1.7 million, or 2%, versus the prior year period.

Harvest volumes increased 1% to 703,000 tons versus 692,000 tons in the prior year period, reflecting a pickup in activity to more normalized levels following a relatively light first quarter.

Average delivered prices for export sawtimber decreased 5% to $140.44 per ton versus $148.28 per ton in the prior year period.

The decrease in export sawtimber prices versus the prior year period was driven by reduced demand stemming from the COVID-19 lockdowns in China, which in turn contributed to persistently high port inventories.

Net stumpage realizations for export sawtimber were further reduced by significantly higher port / freight costs, driven by elevated fuel prices as well as increased demurrage charges due to port congestion.

Third quarter sales of $72.5 million decreased $3.1 million, or 4%, versus the prior year period.

Harvest volumes increased 7% to 712,000 tons versus 668,000 tons in the prior year period, due to an increase in harvest activity following a relatively light start to the year.

Average delivered prices for export sawtimber decreased 18% to $123.07 per ton versus $149.68 per ton in the prior year period, driven by reduced demand from China due to COVID-related disruptions as well as a slowdown in construction activity.

Average delivered prices for domestic sawtimber decreased 18% to $69.69 per ton versus $85.00 per ton in the prior year period.

2 unchanged sentences

Excluding the impact of foreign exchange rates, domestic sawtimber prices decreased 8% versus the prior year period, reflecting additional supply that was diverted into domestic markets due to export market headwinds.

Operating income of $8.0 million decreased $12.7 million versus the prior year period due to lower net stumpage realizations ($16.5 million), higher costs ($0.9 million) and higher depletion rates ($0.3 million), partially offset by higher carbon credit sales ($3.4 million), favorable foreign exchange impacts ($1.1 million) and higher volumes ($0.5 million).

Second quarter Adjusted EBITDA of $14.9 million was 46%, or $12.8 million, below the prior year period.

Operating income of $9.3 million decreased $4.0 million versus the prior year period due to lower net stumpage realizations ($11.2 million), higher costs ($0.3 million), and higher depletion rates ($0.1 million), partially offset by higher carbon credit sales ($6.0 million), higher volumes ($1.4 million), and favorable foreign exchange impacts ($0.2 million).

Third quarter Adjusted EBITDA of $15.6 million was 22%, or $4.3 million, below the prior year period.

Year-to-date sales of $202.7 million decreased $11.0 million, or 5%, versus the prior year period.

Harvest volumes decreased 2% to 1.9 million tons versus 2.0 million tons in the prior year period.

Average delivered prices

for export sawtimber decreased 1% to $135.13 per ton versus $136.45 per ton in the prior year period.

The decrease in export sawtimber prices versus the prior year period was primarily driven by reduced demand due to COVID-19 related disruptions in China.

Net stumpage realizations for export sawtimber were further pressured by higher shipping and demurrage costs due to ongoing supply chain and port congestion issues.

Average delivered prices for export sawtimber decreased 7% to $130.71 per ton versus $140.89 per ton in the prior year period.

The decrease in export sawtimber prices versus the prior year period was driven by reduced demand due to COVID-19 related disruptions in China and a steep decline in construction activity.

Net stumpage realizations for

export sawtimber were further pressured by higher port and freight costs over the prior year period, driven by elevated fuel prices as well as increased demurrage charges due to port congestion.

Average delivered prices for domestic sawtimber decreased 12% to $73.72 per ton versus $83.79 per ton in the prior year period.

1 unchanged sentence

dollars terms) was driven primarily by the decline in the NZ$/US$ exchange rate (US$0.65 per NZ$1.00 versus US$0.71 per NZ$1.00).

Excluding the impact of foreign exchange rates, domestic sawtimber prices decreased 1% versus the prior year period.

Excluding the impact of foreign exchange rates, domestic sawtimber prices decreased 3% versus the prior year period due to additional supply that was diverted into domestic markets in the current year period.

Operating income of $22.7 million decreased $25.3 million versus the prior year period as a result of lower net stumpage realizations ($33.8 million), lower volumes ($1.0 million), higher costs ($1.7 million) and unfavorable foreign exchange impacts ($0.2 million), partially offset by higher carbon credit sales ($10.9 million) and lower depletion rates ($0.5 million).

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As such, we had no sales, operating income or Adjusted EBITDA in the current quarter or year-to-date period in the Timber Funds segment, as will be the case going forward.

The Timber Funds segment generated prior year second quarter sales of $18.6 million on harvest volumes of 175,000 tons, resulting in operating income of $2.0 million in the prior year period .

Second quarter Adjusted EBITDA was $1.4 million in the prior year period.

The Timber Funds segment generated prior year third quarter sales of $94.5 million on harvest volumes of 61,000 tons, resulting in operating income of $41.3 million in the prior year period .

The prior year quarter sales and operating income included $87.1 million and $36.0 million, respectively, from the Fund II Timberland Dispositions.

The prior year quarter operating income also included a $3.7 million gain on investment in Timber Funds, which reflects the gain recognized on the sale of our investment in Timber Funds III and IV.

Third quarter Adjusted EBITDA was $0.5 million in the prior year period.

The Timber Funds segment generated prior year year-to-date sales of $128.1 million on harvest volumes of 380,000 tons, resulting in operating income of $44.8 million in the prior year period .

The prior year period sales and operating income included $87.1 million and $36.0 million, respectively, from the Fund II Timberland Dispositions.

Year-to-date operating income also included a $3.7 million gain on investment in Timber Funds, which reflects the gain recognized on the sale of our investment in Timber Funds III and IV.

Year-to-date Adjusted EBITDA was $2.8 million in the prior year period.

Second quarter sales of $34.4 million decreased $40.1 million versus the prior year period, while operating income of $11.0 million decreased $39.5 million versus the prior year period.

The prior year second quarter sales and operating income included $36.0 million and $30.3 million, respectively, from a Large Disposition.

Sales and operating income declined versus the prior year period due to a lower number of acres sold (4,694 acres sold versus 16,548 acres sold in the prior year period), partially offset by an increase in weighted-average prices ($7,453 per acre versus $4,571 per acre in the prior year period).

Third quarter sales of $12.4 million decreased $80.9 million versus the prior year period, while operating income of $15.7 million decreased $44.9 million versus the prior year period.

Third quarter operating income included an $11.5 million gain attributable to noncontrolling interests associated with the Bainbridge Island multi-family apartment complex sale..

The prior year third quarter sales and operating income included $20.0 million and $14.5 million, respectively, from a Large Disposition.

Sales and operating income declined versus the prior year period due to a lower number of acres sold (1,828 acres sold versus 12,219 acres sold in the prior year period), and a decrease in weighted-average prices ($5,064 per acre versus $7,554 per acre in the prior year period).

Improved Development sales of $2.3 million included $0.8 million from the Wildlight development project north of Jacksonville, Florida and $1.5 million from the Heartwood development project south of Savannah, Georgia.

Sales in Wildlight consisted of a 22-acre multifamily apartment site for $4.8 million ($222,000 per acre), a 31-acre single-family build-to-rent site for $4.4 million ($140,000 per acre), and 19 residential lots for $1.3 million ($70,000 per lot).

Sales in Heartwood consisted of 26 residential lots for $1.1 million ($42,000 per lot).

This compares to prior year period Improved Development sales of $19.3 million, which reflected significant activity in both Wildlight and Heartwood / Belfast Commerce Park.

There were no Unimproved Development sales in the second quarter or the prior year period.

Rural sales of $23.4 million consisted of 4,633 acres at an average price of $5,054 per acre, which compares to prior year period sales of $20.3 million, which consisted of 7,725 acres at an average price of $2,627 per acre.

There were no Timberland & Non-Strategic sales in the second quarter or the prior year period.

Second quarter Adjusted EBITDA of $25.4 million was $3.7 million below the prior year period.

Sales in Wildlight consisted of 13 residential lots ($65,000 per lot).

Sales in Heartwood consisted of a 15-acre commercial parcel to be used for a healthcare campus for $1.0 million ($67,000 per acre) and 10 residential lots for $0.4 million ($44,000 per lot).

This compares to prior year period Improved Development sales of $27.8 million, which included a significant sale in the Heartwood / Belfast Commerce Park.

There were no Unimproved Development sales in the third quarter.

This compares to prior year period sales of $37.5 million, which consisted of a 359-acre sale in Kingston, Washington for $105,000 per acre.

Rural sales of $7.0 million consisted of 1,809 acres at an average price of $3,848 per acre.

This compares to prior year period sales of $6.9 million, which consisted of 3,260 acres at an average price of $2,128 per acre.

Third quarter Adjusted EBITDA of $8.4 million was $55.4 million below the prior year period.

Year-to-date sales of $81.0 million decreased $97.4 million versus the prior year period, while operating income of $37.0 million decreased $75.9 million versus the prior year period.

There were no Large Dispositions in the current year period, compared with year-to-date sales and operating income of $56.0 million and $44.8 million, respectively, from a Large Disposition in the prior year period.

Sales decreased in the first six months primarily due to lower volumes ( 13,428 acres sold versus 18,943 acres sold in the prior year period), partially offset by higher weighted-average prices ($5,087 per acre versus $4,522 per acre in the prior year period).

Year-to-date Adjusted EBITDA of $50.1 million increased $15.9 million versus the prior year period.

Second quarter sales of $27.7 million decreased $6.9 million versus the prior year period primarily due to lower volumes and prices.

Sales volumes decreased 14% to 209,000 tons versus 243,000 tons in the prior year period, reflecting elevated log inventories in China and constrained export market demand.

The Trading segment generated an operating loss of $0.4 million versus operating income of $0.4 million in the prior year period.

Sales decreased in the first nine months primarily due to lower volumes ( 15,256 acres sold versus 31,162 acres sold in the prior year period) and a decrease in

weighted-average prices ($5,084 per acre versus $5,711 per acre in the prior year period).

Year-to-date Adjusted EBITDA of $58.4 million decreased $39.5 million versus the prior year period.

Third quarter sales of $11.6 million decreased $14.0 million versus the prior year period, primarily due to lower volumes and prices.

Sales volumes decreased 46% to 95,000 tons versus 177,000 tons in the prior year period, reflecting constrained export market demand.

The Trading segment generated operating income of $0.2 million versus breakeven results in the prior year period.

Third quarter Adjusted EBITDA of $0.2 million was above breakeven results in the prior year period.

Year-to-date sales of $52.7 million decreased $24.1 million versus the prior year period, primarily due to lower volumes, as well as lower prices.

Sales volumes decreased 26% to 415,000 tons versus 561,000 tons in the prior year period.

The Trading segment generated an operating loss of $0.1 million versus operating income of $0.7 million in the prior year period.

The Trading segment generated operating income of $0.1 million versus operating income of $0.6 million in the prior year period.

CORPORATE AND OTHER EXPENSE / ELIMINATIONS

Second quarter corporate and other operating expenses of $10.1 million increased $2.1 million versus the prior year period, primarily due to higher compensation and benefits expenses ($1.5 million), higher legal costs ($0.3 million) and higher insurance and travel expenses ($0.3 million).

Year-to-date corporate and other operating expenses of $17.7 million increased $2.0 million versus the prior year period, primarily due to higher compensation and benefits expenses ($1.2 million), higher legal costs ($0.4 million) and higher insurance and travel expenses ($0.4 million).

Compensation and benefits expenses were elevated in the current quarter and year-to-date period due to the accelerated realization of equity compensation expense for retirement-eligible employees.

Third quarter corporate and other operating expenses of $9.0 million increased $2.2 million versus the prior year period, primarily due to higher compensation and benefits expenses ($1.4 million) and higher legal and other overhead expenses ($0.8 million).

Year-to-date corporate and other operating expenses of $26.6 million increased $4.3 million versus the prior year period, primarily due to higher compensation and benefits expenses ($2.7 million), higher legal costs ($0.4 million), higher insurance and community costs of ($0.4 million) and other overhead expenses ($0.8 million).

Compensation and benefits expenses were elevated in the year-to-date period due to the accelerated realization of equity compensation expense for retirement-eligible employees.

INTEREST EXPENSE

Second quarter and year-to-date interest expense of $9.1 million and $17.4 million, respectively, decreased $3.9 million and $5.6 million versus the prior year period, as the prior year period included a $2.2 million loss from the termination of a cash flow hedge.

Additionally, second quarter and year-to-date interest expense benefited from lower average outstanding debt and a lower average interest rate as compared to the prior year period.

Third quarter and year-to-date interest expense of $9.1 million and $26.5 million, respectively, decreased $2.2 million and $7.8 million versus the prior year period.

Third quarter and year-to-date interest expense benefited from lower average outstanding debt and a lower weighted-average interest rate as compared to the prior year period.

Additionally, the prior year-to-date period included a $2.2 million loss from the termination of a cash flow hedge.

INCOME TAX EXPENSE

Second quarter and year-to-date income tax expense of $1.3 million and $6.8 million, respectively, decreased $5.6 million and $3.5 million versus the prior year period.

Third quarter and year-to-date income tax expense of $1.2 million and $8.1 million, respectively, decreased $1.6 million and $5.1 million versus the prior year period.

The New Zealand subsidiary is the primary driver of income tax expense.

In our Southern Timber segment, we now expect full-year harvest volumes of 6.4 to 6.6 million tons, as strong customer demand and favorable weather conditions are allowing us to successfully execute our annual harvest plan.

We are encouraged by the significant year-over-year pricing gains that have been realized across our operating areas.

However, we expect modestly lower weighted-average net stumpage realizations during the second half of 2022 as compared to the first half, primarily due to higher cut and haul costs as a result of elevated diesel prices and a higher proportion of thinning volume.

In our Pacific Northwest Timber segment, we now expect full-year harvest volumes of 1.6 to 1.7 million tons, due in part to a modest adjustment in our harvest plan to reflect land sales, as well as reduced China export volume.

We further expect that weighted-average delivered log prices will remain well above prior year levels for the balance of the year.

However, we anticipate these pricing gains will be partially offset by higher cut and haul costs due to elevated diesel prices.

In our New Zealand Timber segment, we now expect full-year harvest volumes of 2.6 to 2.7 million tons.

While domestic log demand was strong throughout the first half of the year, export market dynamics were negatively impacted by ongoing COVID-19 lockdowns in China.

We expect export sawtimber prices to stabilize in the second half of the year in response to improved offtake from Chinese ports and a reduction in competing log supply.

However, we expect that net stumpage realizations on export volume will continue to be constrained by elevated port and freight costs.

In the domestic market, we anticipate continued strong log demand, although we expect that pricing will be modestly lower in the second half of the year as compared to the first half of the year due to added supply pressure resulting from reduced export volume.

Partially offsetting these headwinds, we expect a higher contribution from non-timber income (carbon credit sales) in the second half of the year as compared to the first half.

In our Real Estate segment, following strong Real Estate results in the first half of the year, we anticipate lower quarterly results for the balance of the year.

In our Southern Timber segment, we expect continued strong demand trends across our localized markets.

In our Pacific Northwest Timber segment, we expect continued strong pricing for both pulpwood and sawtimber, albeit partially offset by ongoing cost pressures.

In our New Zealand Timber segment, we expect lower harvest volumes for the remainder of the year due to ongoing export market headwinds as demand from China remains constrained.

In our Real Estate segment, we now anticipate that a few transactions will be deferred into early 2023, and that demand for certain rural properties will likely moderate with the recent increase in interest rates.

LIQUIDITY AND CAPITAL RESOURCES

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SUMMARY OF LIQUIDITY AND FINANCING COMMITMENTS

June 30, December 31,

September 30, December 31,

(millions of dollars) 2022 2021

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Net debt to enterprise value (b)(c) 18 % 14 %

(a) Total debt as of June 30, 2022 and December 31, 2021 reflects principal on long-term debt, gross of deferred financing costs and unamortized discounts.

(a) Total debt as of September 30, 2022 and December 31, 2021 reflects principal on long-term debt, gross of deferred financing costs and unamortized discounts.

(b) Net debt is calculated as total debt less cash and cash equivalents.

“OP” units) plus net debt based on Rayonier’s share price of $37.38 and $40.36 as of June 30, 2022 and December 31, 2021, respectively.

“OP” units) plus net debt based on Rayonier’s share price of $29.97 and $40.36 as of September 30, 2022 and December 31, 2021, respectively.

AT-THE-MARKET (“ATM”) EQUITY OFFERING PROGRAM

On September 10, 2020, we entered into a distribution agreement with a group of sales agents through which we may sell common shares, from time to time, having an aggregate sales price of up to $300 million.

As of June 30, 2022, $1.0 million remains available for issuance under the program.

As of September 30, 2022, $1.0 million remains available for issuance under the program.

The following table outlines common share issuances pursuant to our ATM program (dollars in millions):

Three Months Ended

June 30, Six Months Ended June 30,

September 30, Nine Months Ended September 30,

2022 2021 2022 2021

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Gross proceeds from common shares issued under the ATM program — $51.8 $30.1 $169.6

The following table summarizes our cash flows from operating, investing and financing activities for the six months ended June 30, 2022 and 2021:

The following table summarizes our cash flows from operating, investing and financing activities for the nine months ended September 30, 2022 and 2021:

(millions of dollars) 2022 2021

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CASH PROVIDED BY OPERATING ACTIVITIES

Cash provided by operating activities decreased $16.1 million from the prior year period primarily due to lower operating results and changes in working capital.

CASH USED FOR INVESTING ACTIVITIES

Cash used for investing activities decreased $14.6 million from the prior year period primarily due to lower timberland acquisitions ($48.6 million), lower capital expenditures ($1.9 million) and lower real estate development investments ($0.3 million), partially offset by lower proceeds from Large Dispositions ($35.2 million) and other investing activities ($1.0 million).

Cash provided by operating activities decreased $67.6 million from the prior year period primarily due to lower operating results.

CASH (USED FOR) PROVIDED BY INVESTING ACTIVITIES

Cash used for investing activities of $55.9 million compares to cash provided by investing activities $69.3 million of in the prior year period.

This is primarily due to prior year net proceeds from Fund II timberland dispositions ($85.2 million), Large Dispositions ($54.7 million), and the sale of Timber Funds III and IV ($31.1 million), as well as higher real estate development investments ($1.8 million), higher capital expenditures ($0.7 million) and other investing activities ($0.5 million), partially offset due to lower timberland acquisitions ($48.7 million).

CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES

Cash used for financing activities of $237.6 million compares to cash provided by financing activities of $47.7 million in the prior year period.

This is primarily due to lower net borrowings ($221.2 million), lower net proceeds from the issuance of common shares under the ATM equity offering program ($78.8 million), higher dividends paid on common shares ($6.1 million), higher share repurchases ($2.6 million) and lower proceeds from the issuance of common shares under the Company’s incentive stock plan ($1.9 million), partially offset by lower distributions to consolidated affiliates ($8.5 million), lower debt issuance costs of ($4.8 million) and lower distributions to noncontrolling interests in the operating partnership ($0.4 million).

This is primarily due to lower net borrowings ($151.4 million), lower net proceeds from the issuance of common shares under the ATM equity offering program ($134.7 million), higher dividends paid on common shares ($9.4 million), higher share repurchases ($2.6 million) and lower proceeds from the issuance of common shares under the Company’s incentive stock plan ($2.1 million), partially offset by a make-whole payment fees on the prepayment of NWFCS debt ($6.2 million) in the prior period, lower distributions to consolidated affiliates ($3.1 million), lower debt issuance costs of ($4.8 million) and lower distributions to noncontrolling interests in the operating partnership ($0.6 million).

FUTURE USES OF CASH

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units, distributions to noncontrolling interests, and repurchases of the Company’s common shares to satisfy other commitments.

During Q2 2022, the Company announced a 5.6% increase in its quarterly cash dividend from $0.27 to $0.285 per common share and Rayonier, LP unit.

Significant long-term uses of cash include the following (in millions):

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Long-term debt (a) $1,265.6 — — $242.6 $1,023.0

Current maturities of long-term debt (b) 0.6 — 0.6 — —

Interest payments on long-term debt (b) 291.4 14.9 94.6 87.4 94.5

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See Note 6 - Debt for additional information.

(b) Projected interest payments for variable-rate debt were calculated based on outstanding principal amounts and interest rates as of June 30, 2022.

(b) Projected interest payments for variable-rate debt were calculated based on outstanding principal amounts and interest rates as of September 30, 2022.

(d) Commitments — developmental projects primarily consists of payments expected to be made on our Wildlight and Heartwood projects.

(e) Commitments — derivatives represent payments expected to be made on derivative financial instruments (interest rate swaps and forward-starting interest rate swaps).

(e) Commitments — derivatives represent payments expected to be made on derivative financial instruments (foreign exchange contracts).

See Note 7 — Derivative Financial Instruments and Hedging Activities for additional information.

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We expect to fund future uses of cash with a combination of existing cash balances, cash generated by operating activities, the remaining issuances available under the Company’s ATM Program, Large Dispositions and the use of our revolving credit facilities.

We believe we have sufficient sources of funding to meet our business requirements for the next 12 months and in the longer term.

EXPECTED 2022 EXPENDITURES

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Full-year 2022 cash tax payments are expected to be approximatel y $15.0 million, primarily related to the New Zealand subsidiary.

First quarter cash tax payments were elevated due to the required timing of tax payments for our New Zealand subsidiary following the full utilization of its NOLs.

First quarter cash tax payments were elevated due to the required timing of tax payments for our New Zealand subsidiary following the full utilization of its net operating losses.

OFF-BALANCE SHEET ARRANGEMENTS

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Off-balance sheet arrangements are not considered a source of liquidity or capital resources and do not expose us to material risks or material unfavorable financial impacts.

See Note 12 — Guarantees for details on the letters of credit and surety bonds as of June 30, 2022.

See Note 12 — Guarantees for details on the letters of credit and surety bonds as of September 30, 2022.

SUMMARY OF GUARANTOR FINANCIAL INFORMATION

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The summarized balance sheet information for the consolidated obligor group of debt issued by Rayonier, L.P.

for the six months ended June 30, 2022 and year ended December 31, 2021 are provided in the table below:

(in millions) June 30, 2022 December 31, 2021

for the nine months ended September 30, 2022 and year ended December 31, 2021 are provided in the table below:

(in millions) September 30, 2022 December 31, 2021

Current assets $254.9 $335.8

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The summarized results of operations information for the consolidated obligor group of debt issued by Rayonier, L.P.

for the six months ended June 30, 2022 and year ended December 31, 2021 are provided in the table below:

(in millions) June 30, 2022 December 31, 2021

for the nine months ended September 30, 2022 and year ended December 31, 2021 are provided in the table below:

(in millions) September 30, 2022 December 31, 2021

Cost and expenses ($21.6) ($27.5)

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It excludes specific items that management believes are not indicative of the Company’s ongoing operating results.

We define Adjusted EBITDA as earnings before interest, taxes, depreciation, depletion, amortization, the non-cash cost of land and improved development, non-operating income and expense, operating income attributable to noncontrolling interests in Timber Funds, gain associated with multi-family apartment complex sale attributable to noncontrolling interests, the gain on the investment in Timber Funds, Fund II Timberland Dispositions, timber write-offs resulting from a casualty event and Large Dispositions.

We reconcile Adjusted EBITDA to Net Income for the consolidated Company and to Operating Income for the segments, as those are the most comparable GAAP measures for each.

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2022 2021 2022 2021

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Non-cash cost of land and improved development 3.1 15.8 20.3 22.8

Non-operating expense — 1.2 0.6 1.2

Large Dispositions (a) — (30.3) — (30.3)

Gain associated with the multi-family apartment complex sale attributable to NCI (a) (11.5) — (11.5) —

Timber write-offs resulting from a casualty event attributable to Rayonier (b) 1.1 — 1.1 —

Non-operating (income)/ expense (0.1) (1.2) 0.5 —

Gain on investment in Timber Funds (c) — (3.7) — (3.7)

Fund II Timberland Dispositions attributable to Rayonier (d) — (7.2) — (7.2)

Large Dispositions (e) — (14.5) — (44.8)

Adjusted EBITDA $64.7 $114.6 $245.8 $279.4

(a) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

In June 2021, we completed the disposition of approximately 9,000 acres located in Washington for a sales price and gain of approximately $36.0 million and $30.3 million, respectively.

(a) Gain associated with the multi-family apartment complex sale attributable to NCI represents the gain recognized in connection with the sale of property by the Bainbridge Landing joint venture attributable to noncontrolling interests.

(b) Timber write-offs resulting from a casualty event include the write-off of merchantable and pre-merchantable timber volume destroyed by casualty events which cannot be salvaged.

(c) Gain on investment in Timber Funds represents the gain recognized on the sale of rights to manage two timber funds (Funds III and IV) previously managed by the Company’s Olympic Resources Management (ORM) subsidiary, as well as its co-investment stake in both funds.

(d) Fund II Timberland Dispositions represent the disposition of Fund II Timberland assets, which we managed and owned a co-investment stake in.

(e) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

The following tables provide a reconciliation of Operating Income by segment to Adjusted EBITDA by segment for the respective periods (in millions of dollars):

Three Months Ended Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate

June 30, 2022

Operating income (loss) $24.1 $2.9 $8.0 — $11.0 ($0.4) ($10.1) $35.5

September 30, 2022

Operating income $22.5 $2.2 $9.3 — $15.7 $0.2 ($9.0) $40.9

Gain associated with the multi-family apartment complex sale attributable to NCI (a) — — — — (11.5) — — (11.5)

Timber write-offs resulting from a casualty event attributable to Rayonier (b) — 1.1 — — — — — 1.1

Depreciation, depletion and amortization 14.1 9.4 6.3 — 1.0 — 0.3 31.1

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Adjusted EBITDA $36.6 $12.6 $15.6 — $8.4 $0.2 ($8.6) $64.7

June 30, 2021

September 30, 2021

Operating income $12.8 $2.1 $13.3 $41.3 $60.6 — ($6.7) $123.3

Gain on investment in Timber Funds (c) — — — (3.7) — — — (3.7)

Fund II Timberland Dispositions attributable to Rayonier (d) — — — (7.2) — — — (7.2)

Operating income attributable to NCI in Timber Funds — — — (30.5) — — — (30.5)

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Non-cash cost of land and improved development — — — — 15.8 — — 15.8

Large Dispositions (a) — — — — (30.3) — — (30.3)

Large Dispositions (e) — — — — (14.5) — — (14.5)

Adjusted EBITDA $24.4 $12.5 $19.9 $0.5 $63.8 — ($6.4) $114.6

(a) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

In June 2021, we completed the disposition of approximately 9,000 acres located in Washington for a sales price and gain of approximately $36.0 million and $30.3 million, respectively.

Six Months Ended Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate

June 30, 2022

Operating income (loss) $54.4 $9.5 $13.4 — $21.2 ($0.1) ($17.7) $80.8

(a) Gain associated with the apartment complex sale attributable to NCI represents the gain recognized in connection with the sale of property by the Bainbridge Landing joint venture attributable to noncontrolling interests.

(b) Timber write-offs resulting from a casualty event include the write-off of merchantable and pre-merchantable timber volume destroyed by casualty events which cannot be salvaged.

(d) Fund II Timberland Dispositions represent the disposition of Fund II Timberland assets, which we managed and owned a co-investment stake in.

(e) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

Nine Months Ended Southern Timber Pacific Northwest Timber New Zealand Timber Timber Funds Real Estate Trading Corporate

September 30, 2022

Operating income $76.9 $11.7 $22.7 — $37.0 $0.1 ($26.6) $121.7

Gain associated with the apartment complex sale attributable to NCI (a) — — — — (11.5) — — (11.5)

Timber write-offs resulting from casualty event attributable to Rayonier (b) — 1.1 — — — — — 1.1

Depreciation, depletion and amortization 46.8 35.6 18.2 — 12.7 — 0.9 114.2

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Adjusted EBITDA $123.7 $48.4 $40.8 — $58.4 $0.1 ($25.7) $245.8

June 30, 2021

September 30, 2021

Operating income $47.1 $5.3 $48.0 $44.8 $112.8 $0.6 ($22.3) $236.2

Gain on investment in Timber Funds (c) — — — (3.7) — — — (3.7)

Fund II Timberland Dispositions attributable to Rayonier (d) — — — (7.2) — — — (7.2)

Operating income attributable to NCI in Timber Funds — — — (33.3) — — — (33.3)

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Non-cash cost of land and improved development — — — — 22.8 — — 22.8

Large Dispositions (a) — — — — (30.3) — — (30.3)

Large Dispositions (e) — — — — (44.8) — — (44.8)

Adjusted EBITDA $86.6 $44.1 $68.7 $2.8 $97.9 $0.6 ($21.4) $279.4

(a) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

In June 2021, we completed the disposition of approximately 9,000 acres located in Washington for a sales price and gain of approximately $36.0 million and $30.3 million, respectively.

(b) Timber write-offs resulting from a casualty event include the write-off of merchantable and pre-merchantable timber volume destroyed by casualty events which cannot be salvaged.

(d) Fund II Timberland Dispositions represent the disposition of Fund II Timberland assets, which we managed and owned a co-investment stake in.

(e) Large Dispositions are defined as transactions involving the sale of timberland that exceed $20 million in size and do not have a demonstrable premium relative to timberland value.

The following table provides a reconciliation of Cash Provided by Operating Activities to Adjusted CAD (in millions of dollars):

Six Months Ended June 30,

Nine Months Ended September 30,

Cash provided by operating activities $209.9 $277.4

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CAD after mandatory debt repayments $158.8 ($121.1)

Cash used for investing activities ($34.5) ($49.1)

Cash (used for) provided by investing activities ($55.9) $69.3

Cash (used for) provided by financing activities ($237.6) $47.7

(a) Capital expenditures exclude timberland acquisitions of $3.2 million and $51.9 million during the six months ended June 30, 2022 and June 30, 2021, respectively.

The following table provides supplemental cash flow data (in millions):

Six Months Ended June 30,

(a) Capital expenditures exclude timberland acquisitions of $3.2 million and $51.9 million during the nine months ended September 30, 2022 and September 30, 2021, respectively.

The following table provides supplemental cash flow data (in millions of dollars):

Nine Months Ended September 30,

Purchase of timberlands ($3.2) ($51.9)

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis