What changed in this filing

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Item 1. Financial Statements

2023-10-27 compared with 2023-07-28 · 224 added, 124 removed, 859 unchanged (29% of the section changed)

5 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Net sales (Note 3)

18 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

Other comprehensive income:

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Other comprehensive income (loss):

Foreign currency translation adjustments

Changes in unamortized actuarial loss, net of tax expense of $ 3 , $ 11 , $ 7 and $ 40

Changes in unamortized net prior service credit, net of tax (expense) benefit of $ 1 , $ 0 , $ 1 and ($ 1 )

Total other comprehensive income

Changes in unamortized net prior service credit, net of tax benefit (expense) of $ 0 , $ 0 , $ 1 and ($ 1 )

Total other comprehensive income (loss)

Total comprehensive income

3 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS, EXCEPT PAR VALUE

SEPTEMBER 30,

Current assets:

27 unchanged sentences

issued and outstanding:

730,850 thousand shares at June 30, 2023 and 732,794 thousand shares at December 31, 2022

730,128 thousand shares at September 30, 2023 and 732,794 thousand shares at December 31, 2022

Other capital

7 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

Cash flows from operations:

35 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Common shares:

16 unchanged sentences

Balance at beginning of period

Other comprehensive income

Other comprehensive income (loss)

Balance at end of period (Note 11)

18 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

FOR THE QUARTERS AND YEAR-TO-DATE PERIODS ENDED JUNE 30, 2023 AND 2022

FOR THE QUARTERS AND YEAR-TO-DATE PERIODS ENDED SEPTEMBER 30, 2023 AND 2022

BASIS O F PRESENTATION

29 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Sales to unaffiliated customers:

12 unchanged sentences

(1) Unallocated items are gains or charges not related to, or allocated to, an individual operating segment.

They include all or a portion of items such as share-based compensation, pension and post-employment costs, elimination of intersegment profit in inventory and LIFO, foreign exchange transaction gains and losses, interest income and other as well as legacy obligations.

REVENU E RECOGNITION

3 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Net sales to unaffiliated customers:

25 unchanged sentences

Our basic and diluted earnings per share were:

$ 0.31 during second quarter 2023 and $ 0.52 during year-to-date 2023;

$ 1.06 during second quarter 2022 and $ 2.09 during year-to-date 2022.

$ 0.33 during third quarter 2023 and $ 0.85 during year-to-date 2023;

$ 0.42 during third quarter 2022 and $ 2.51 du ring year-to-date 2022.

Basic earnings per share is net earnings divided by the weighted average number of our outstanding common shares, including stock equivalent units where there is no circumstance under which those shares would not be issued.

3 unchanged sentences

SHARES IN THOUSANDS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Weighted average common shares outstanding –

12 unchanged sentences

SHARES IN THOUSANDS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Stock options

3 unchanged sentences

Concurrently, the board terminated the remaining repurchase authorization under the share repurchase program approved by the board in February 2019 (the 2019 Repurchase Program).

We repurchased 1,689,874 common shares for approximately $ 50 million (including transaction fees) under the 2021 Repurchase Program during second quarter 2023 and 2,805,434 common shares for approximately $ 85 million under the 2021 Repurchase Program during year-to-date 2023.

As of June 30, 2023, we had remaining authorization of $ 292 million for future share repurchases.

We repurchased 757,510 common shares for approximately $ 25 million (including transaction fees) under the 2021 Repurchase Program during third quarter 2023 and 3,562,944 common shares for approximately $ 110 million under the 2021 Repurchase Program during year-to-date 2023.

As of September 30, 2023, we had remaining authorization of $ 267 million for future share repurchases.

During year-to-date 2022 , we repurchased 11,217,300 common shares for approximately $ 404 million (including transaction fees) under the 2021 Repurchase Program.

2 unchanged sentences

We record a liability for repurchases that have not yet been settled as of period end.

There were no unsettled shares as of June 30, 2023 , and 223,548 unsettled shares (approximately $ 7 million) as of December 31, 2022.

There were 32,757 unsettled shares (approximately $ 1 million) as of September 30, 2023, and 223,548 unsettled shares (approximately $ 7 million) as of December 31, 2022.

Inventories include raw materials, work-in-process and finished goods, as well as materials and supplies.

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 30,

LIFO inventories:

17 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Interest cost

7 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Interest cost

16 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 30,

Compensation and employee benefit costs

3 unchanged sentences

LONG-TERM DEBT AND LINE OF CREDIT

In July 2023, we repaid $ 118 million of our 7.125 % notes at maturity.

In July 2023, we repaid $ 118 million of our 7.125 percent notes at maturity.

In May 2023, we completed an offering of debt securities by issuing $ 750 million of 4.750 percent notes due in May 2026 .

8 unchanged sentences

In March 2023, we entered into a new $ 1.5 billion five-year senior unsecured revolving credit facility, which expires in March 2028 and replaced the existing facility which was set to expire in January 2025.

Borrowings will bear interest at a floating rate based on either the adjusted term Secured Overnight Financing Rate (SOFR) plus a spread or a mutually agreed upon base rate plus a spread.

We ha d no outstanding borrowings o n our credit facility as of June 30, 2023 and December 31, 2022 .

Borrowings will bear interest at a floating rate based on either the adjusted term Secured Overnight Financing Rate (SOFR) plus a spread or a mutually agreed upon base rate plus a sprea d.

We had no ou tstanding borrowings on our credit facility as of September 30, 2023 and December 31, 2022 .

FAIR VALUE OF FINANCIAL INSTRUMENTS

1 unchanged sentence

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 30,

Long-term fixed rate debt (including current maturities):

8 unchanged sentences

This is primarily due to the short-term nature of these instruments and the allowance for doubtful accounts.

As of June 30, 2023, we had $ 665 million in short-term investments classified as held-to-maturity debt securities, which consist of a mixture of term deposits and Treasury bills.

As of September 30, 2023, we had $ 668 million in short-term investments classified as held-to-maturity debt securities, which consist of a mixture of term deposits and Treasury bills.

We did no t have any short-term investments classified as held-to-maturity debt securities as of December 31, 2022.

12 unchanged sentences

have been notified that we may be a potentially responsible party related to the cleanup of other hazardous waste sites for which proceedings have not yet been initiated.

As of June 30, 2023, our total accrual for future estimated remediation costs on active Superfund sites and other sites for which we are potentially responsible was approximately $ 75 million.

As of September 30, 2023, our total accrual for future estimated remediation costs on active Superfund sites and other sites for which we are potentially responsible was approximately $ 75 million.

These amounts are recorded in "Accrued liabilities" and "Other liabilities" on our Consolidated Balance Sheet .

4 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Balance at beginning of period

Other comprehensive (loss) income before reclassifications

Other comprehensive income (loss) before reclassifications

Amounts reclassified from accumulated other comprehensive loss to earnings (2)

3 unchanged sentences

Balance at beginning of period

Other comprehensive income (loss) before reclassifications

Other comprehensive loss before reclassifications

Amounts reclassified from accumulated other comprehensive loss to earnings (2)

4 unchanged sentences

Translation adjustments

Total other comprehensive income (loss)

Total other comprehensive loss

Balance at end of period

32 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Environmental remediation charges

Foreign exchange gains, net

Foreign exchange losses (gains), net

Litigation expense, net

7 unchanged sentences

TIMBERLAND ACQUISITIONS

On July 19, 2023, we completed the purchase of 22 thousand acres of Mississippi timberlands for approximately $ 60 million.

On July 19, 2023, we completed the purchase of 22 thousand acres of Mississippi timberlands for ap proximately $ 60 million.

We recorded $ 59 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million o f related assets in "Property and equipment, net" on our Consolidated Balance Sheet .

On May 18, 2022, we completed the purchase of 81 thousand acres of North and South Carolina timberlands for approximately $ 265 million.

11 unchanged sentences

our expectations concerning our contingent liabilities and the sufficiency of related reserves and accruals including, but not limited to, cost estimates of future litigation and environmental remediation;

our provision for income taxes;

expected capital expenditures;

expected returns on pension plan assets;

market and general economic conditions, including related influencing factors such as the trajectory of U.S.

10 unchanged sentences

“foreseeable,”

“future,”

“maintain,”

“may,”

“plan,”

“potential,”

“will,”

and “would,”

and “will,”

or similar words or terminology.

63 unchanged sentences

Over the past year, home sales and building activity slowed due in part to higher mortgage interest rates, reduced affordability and general macroeconomic conditions.

During second quarter 2023, market conditions improved in response to a stabilization in mortgage rates and increased homebuilder sentiment.

During third quarter 2023, market conditions continued to shift towards sales of new homes as existing inventory remained near record-low levels.

On a seasonally adjusted annual basis, as reported by the U.S.

Census Bureau, housing starts for second quarter 2023 averaged 1.45 million units, a 4.5 percent increase from first quarter 2023.

Single-family starts averaged 929 thousand units, an 11.4 percent increase from first quarter 2023.

Multi-family starts averaged 518 thousand units in second quarter 2023, which was a 6.1 percent decrease from first quarter 2023.

Sales of newly built, single-family homes averaged a seasonally adjusted annual rate of 694 thousand units for second quarter 2023, an increase of 8.8 percent from the prior quarter.

Census Bureau, housing starts for third quarter 2023 averaged 1.36 million units, a 6.2 percent decrease from second quarter 2023.

Single-family starts averaged 961 thousand units in third quarter 2023, a 3.4 percent increase from second quarter 2023.

Multi-family starts averaged 398 thousand units in third quarter 2023, which was a 23.5 percent decrease from second quarter 2023.

Single-family construction is the primary driver for our business as compared to multi-family due to the amount of wood products used.

Sales of newly built, single-family homes averaged a seasonally adjusted annual rate of 724 thousand units for third quarter 2023, an increase of 4.8 percent from the prior quarter.

Over the medium to long-term, we expect a favorable U.S.

housing construction market supported by strong demographics in the key homebuying age cohorts, a decade of underbuilding and a historically low housing inventory.

Repair and remodeling expenditures decreased by 1.9 percent from first quarter 2023 to second quarter 2023 according to the Census Bureau Advance Retail Spending report.

Repair and remodeling expenditures were steady from second quarter 2023 to third quarter 2023 according to the Census Bureau Advance Retail Spending report.

Do-it-yourself activity has been returning to more normalized levels while professionally contracted activities have benefited from larger projects and increases in home equity levels.

1 unchanged sentence

housing stock, with a median age of 43 years.

wood product markets, demand in early second quarter 2023 continued to be affected by softening in the housing market and ongoing macroeconomic uncertainty.

As the quarter progressed, improvements in the housing market, combined with supply concerns resulting from a series of temporary and permanent mill curtailments and wildfires in Canada, led to moderately tighter markets.

The Random Lengths Framing Lumber Composite price averaged $409/MBF and the OSB Composite averaged $360/MSF in second quarter 2023.

Over the course of the second quarter, prices increased from $417/MBF to $438/MBF for lumber and from $297/MSF to $432/MSF for OSB.

In Western log markets, Douglas fir sawlog prices rose by 0.4 percent in second quarter 2023 compared with first quarter 2023, as reported by RISI Log Lines based on Weyerhaeuser’s sales mix.

Overall, domestic prices in the West stayed consistent, with lower lumber prices offset by continued constraints in log supply.

In the South, delivered sawlog prices remained flat in second quarter 2023 compared to first quarter 2023 and declined 1.5 percent from second quarter 2022 as reported by TimberMart-South, as log and haul capacity constraints eased somewhat.

wood product markets, demand in third quarter 2023 helped lift prices in mid-summer.

By the end of the third quarter, this had been offset by macroeconomic and housing market uncertainty, including an increase in interest and mortgage rates.

Temporary and permanent curtailments provided some balance to the market.

OSB demand was strong for most of the quarter, as customer inventories were not sufficient to meet current building activity.

The Random Lengths Framing Lumber Composite price averaged $438/MBF and the OSB Composite averaged $540/MSF in third quarter 2023.

Over the course of the third quarter, prices for lumber decreased from $438/MBF to $422/MBF and prices for OSB increased from $432/MSF to $454/MSF.

In Western log markets, Douglas fir sawlog prices decreased by 0.2 percent in third quarter 2023 compared with second quarter 2023, as reported by RISI Log Lines based on Weyerhaeuser’s sales mix.

Overall, domestic prices in the West declined due to compressed mill margins, but this was partially offset by continued constraints in log supply.

In the South, delivered sawlog prices decreased 0.3 percent in third quarter 2023 compared to second quarter 2023 and declined 2.0 percent from third quarter 2022 as reported by TimberMart-South.

Favorable harvest conditions later in the quarter provided sufficient supply to meet mills' needs.

Currency exchange rates, available supply from other countries and trade policy affect our export businesses.

During second quarter 2023, end use demand softened in export markets, partially offset by continued disruptions in global log and lumber supply.

In Japan, total housing starts decreased 1.6 percent year to date through May compared to the same period in 2022, while the key Post and Beam segment saw a 5.9 percent decrease.

An increase in lumber imports to Japan from Europe placed downward pressure on market conditions.

China demand has improved from low levels late in 2022 but remains subdued due to general economic conditions and increased supply of logs from New Zealand.

During third quarter 2023, end use demand softened in export markets, partially offset by continued disruptions in global log and lumber supply.

In Japan, total housing starts decreased 3.7 percent year to date through August compared to the same period in 2022, while the key Post and Beam segment saw a 5.7 percent decrease.

Lumber imports to Japan from Europe placed downward pressure on market conditions.

China demand has improved from low levels late in 2022 but remains subdued due to general economic conditions and steady supply of logs from New Zealand and rough lumber from Russia.

Interest rates affect our business primarily through their impact on mortgage rates and housing affordability, their general impact on the economy and their influence on our capital management activities.

1 unchanged sentence

Federal Reserve, the overall condition of the economy and fluctuations in financial markets are all factors that influence long-term interest rates.

30-year mortgage rates, which are correlated with long-term interest rates, increased from 6.3 percent at the end of first quarter 2023 to 6.7 percent at the end of second quarter 2023.

While mortgage rates remain elevated, home buyers have responded favorably to even small reductions.

Builders have also been able to offset higher mortgage rates through discounts, loan subsidies and modifying product offerings such as home sizes and finishes.

30-year mortgage rates, which are correlated with long-term interest rates, increased from 6.7 percent at the end of second quarter 2023 to 7.3 percent at the end of third quarter 2023, according to economic data from the St.

Louis Federal Reserve.

Many builders have been able to offset higher mortgage rates through discounts, mortgage rate buydowns and modifying product offerings such as home sizes and finishes.

Higher rates have also locked-in many existing homeowners from selling, reducing inventories of existing homes for sale which has led to increased demand for available new homes.

Increased inflation affects the cost of our operations across each of our business segments, including costs for raw materials, transportation, energy and labor.

The Consumer Price Index increased 3.0 percent year over year in June 2023, which is markedly down from its peak of over 9.0 percent in June 2022.

The Consumer Price Index increased 3.7 percent year over year in September 2023, which is markedly down from its peak of over 9.0 percent in June 2022.

While we can offset some of the impacts of inflation through our sales activities, our operational excellence initiatives and our procurement practices, not all of the costs associated with inflation can be fully mitigated or passed on to the consumer.

The condition of the labor market affects all of our businesses as it relates to our ability to attract and retain employees and contractors.

The unemployment rate of 3.6 percent in June 2023 remained near historically low levels and increased 0.1 percent from the end of first quarter 2023.

Labor force participation has increased to 62.6 percent in June 2023, from 62.2 percent in June 2022, approaching pre-Pandemic levels of 63 percent.

The unemployment rate of 3.8 percent in September 2023 remained near historically low levels and increased 0.2 percent from the end of second quarter

Labor force participation has increased to 62.8 percent in September 2023, from 62.3 percent in September 2022, approaching pre-pandemic levels.

Governments and businesses across the globe are taking action on climate change and are making significant commitments towards decarbonizing operations and reducing greenhouse gas emissions to net zero.

2 unchanged sentences

CONSOLIDATED RESULTS

How We Did Second Quarter 2023 and Year-to-Date 2023

How We Did Third Quarter 2023 and Year-to-Date 2023

QUARTER ENDED

1 unchanged sentence

DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Costs of sales

1 unchanged sentence

Earnings per share, basic and diluted

Comparing Second Quarter 2023 with Second Quarter 2022

Comparing Third Quarter 2023 with Third Quarter 2022

Net sales decreased $254 million –

11 percent –

primarily due to an $841 million decrease in Wood Products sales to unaffiliated customers attributable to decreased sales volumes and sales realizations across most product lines, as well as a $98 million decrease in Timberlands net sales to unaffiliated customers primarily attributable to decreased sales realizations and sales volumes in the Western region.

primarily due to a $230 million decrease in Wood Products sales to unaffiliated customers attributable to decreased sales volumes and sales realizations across most product lines.

Costs of sales

1 unchanged sentence

10 percent –

primarily due to decreased sales volumes and raw material costs across most product lines and decreased freight costs within our Wood Products segment, as well as decreased export log freight costs and third-party log purchases within our Timberlands segment.

primarily due to decreased sales volumes across most product lines within our Wood Products segment, as well as decreased freight costs.

Operating income

1 unchanged sentence

23 percent –

primarily due to a $715 million decrease in consolidated gross margin, as discussed above.

primarily due to an $80 million decrease in consolidated gross margin, as discussed above.

Net earnings decreased $71 million –

1 unchanged sentence

primarily due to the $104 million decrease in operating income, as discussed above.

This decrease in operating income was partially offset by a $159 million decrease in income tax expense (refer to Income Taxes ).

This decrease was partially offset by a $23 million decrease in income tax expense (refer to Income Taxes ).

Comparing Year-to-Date 2023 with Year-to-Date 2022

1 unchanged sentence

29 percent –

primarily due to a $2,042 million decrease in Wood Products sales to unaffiliated customers attributable to decreased sales realizations and sales volumes across most product lines, as well as a $101 million decrease in Timberlands sales to unaffiliated customers attributable to decreased sales realizations in the Western region, partially offset by increased sales volumes in the Southern region and increased stumpage sales.

primarily due to a $2,272 million decrease in Wood Products sales to unaffiliated customers attributable to decreased sales realizations and sales volumes across most product lines, as well as a $162 million decrease in Timberlands sales to unaffiliated customers attributable to decreased sales realizations in the Western region.

Costs of sales

1 unchanged sentence

11 percent –

primarily due to decreased sales volumes and raw material costs across most product lines within our Wood Products segment, as well as decreased freight costs.

primarily due to decreased sales volumes across most product lines within our Wood Products segment, as well as decreased freight costs and Western third-party log purchases.

Operating income

7 unchanged sentences

Long-Term Debt and Line of Credit ).

How We Did Second Quarter 2023 and Year-to-Date 2023

How We Did Third Quarter 2023 and Year-to-Date 2023

QUARTER ENDED

1 unchanged sentence

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Net sales to unaffiliated customers:

8 unchanged sentences

(1) Other Timberlands sales include sales of seeds and seedlings from our nursery operations as well as wood chips.

Comparing Second Quarter 2023 with Second Quarter 2022

Comparing Third Quarter 2023 with Third Quarter 2022

Net sales to unaffiliated customers

1 unchanged sentence

14 percent –

primarily due to a $102 million decrease in Western log sales attributable to a 29 percent decrease in sales realizations and a 7 percent decrease in sales volumes, partially offset by a $4 million increase in stumpage and pay-as-cut timber sales.

primarily due to a $48 million decrease in Western log sales, attributable to a 25 percent decrease in sales realizations, as well as an $11 million decrease in Southern log sales, attributable to a 4 percent decrease in sales realizations and a 3 percent decrease in sales volumes.

Intersegment sales

Intersegment sales decreased $6 million –

Intersegment sales increased $8 million –

6 percent –

primarily due to a 9 percent decrease in sales realizations, partially offset by a 6 percent increase in sales volumes.

primarily due to a 14 percent increase in sales volumes, partially offset by a 7 percent decrease in sales realizations.

Costs of sales

1 unchanged sentence

6 percent –

primarily due to decreased Western third-party log purchases and export log freight costs.

primarily due to decreased Western third-party log purchases and decreased Southern log sales volumes, partially offset by increased logging and hauling costs and increased Western log sales volumes.

Operating income and Net contribution to earnings

6 unchanged sentences

11 percent –

primarily due to a $132 million decrease in Western log sales attributable to a 22 percent decrease in sales realizations, partially offset by a $16 million increase in Southern log sales, attributable to a 5 percent increase in sales volumes, and an $11 million increase in stumpage and pay-as-cut timber sales.

primarily due to a $180 million decrease in Western log sales, primarily attributable to a 23 percent decrease in sales realizations, partially offset by a $13 million increase in stumpage and pay-as-cut timber sales.

Intersegment sales

5 unchanged sentences

3 percent –

primarily due to decreased Western third-party log purchases, partially offset by increased logging and hauling costs as well as increased Southern log sales volumes.

primarily due to decreased Western third-party log purchases, partially offset by increased logging and hauling costs and increased log sales volumes.

Operating income and Net contribution to earnings

6 unchanged sentences

VOLUMES IN THOUSANDS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Third-party log sales –

2 unchanged sentences

REAL ESTATE, ENERGY A ND NATURAL RESOURCES

How We Did Second Quarter 2023 and Year-to-Date 2023

How We Did Third Quarter 2023 and Year-to-Date 2023

QUARTER ENDED

1 unchanged sentence

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Energy and natural resources

2 unchanged sentences

The volume of real estate sales is a function of many factors, including the general state of the economy, demand in local real estate markets, the ability of buyers to obtain financing, the number of competing properties listed for sale, the seasonal nature of sales, the plans of adjacent landowners, our expectation of future price appreciation, the timing of harvesting activities, and the availability of government and not-for-profit funding.

In any period, the average sales price per acre will vary based on the location and physical characteristics of parcels sold.

Comparing Second Quarter 2023 with Second Quarter 2022

Net sales decreased $37 million –

In any period, the average price per acre will vary based on the location and physical characteristics of parcels sold.

Comparing Third Quarter 2023 with Third Quarter 2022

Net sales increased $37 million –

54 percent –

primarily due to a decrease in acres sold, partially offset by an increase in the average price per acre sold.

primarily due to an increase in acres sold, partially offset by a decrease in the average price per acre sold.

Costs of sales

Costs of sales decreased $24 million –

Costs of sales increased $29 million –

207 percent –

primarily due to a decrease in acres sold, as well as a decrease in basis per acre sold.

primarily due to an increase in acres sold.

Operating income and Net contribution to earnings

Operating income and net contribution to earnings decreased $13 million –

Operating income and net contribution to earnings increased $8 million –

17 percent –

3 unchanged sentences

9 percent –

primarily due to a decrease in acres sold, partially offset by an increase in the average price per acre sold.

primarily due to decreases in average price per acre sold and royalty income from our Energy and Natural Resources business.

Costs of sales

Cost of sales decreased $24 million –

Costs of sales increased $5 million –

5 percent –

primarily due to a decrease in acres sold, partially offset by an increase in basis per acre sold.

primarily due to an increase in basis per acre sold.

Operating income and Net contribution to earnings

5 unchanged sentences

YEAR-TO-DATE ENDED

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Average price per acre

WOOD PRODUCTS

How We Did Second Quarter 2023 and Year-to-Date 2023

How We Did Third Quarter 2023 and Year-to-Date 2023

QUARTER ENDED

1 unchanged sentence

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Structural lumber

9 unchanged sentences

(1) Other products produced sales include wood chips, other byproducts and third-party residual log sales from our Canadian Forestlands operations.

Comparing Second Quarter 2023 with Second Quarter 2022

Comparing Third Quarter 2023 with Third Quarter 2022

Net sales decreased $230 million –

1 unchanged sentence

a $106 million decrease in structural lumber sales attributable to a 13 percent decrease in sales realizations, as well as a 3 percent decrease in sales volumes;

a $282 million decrease in oriented strand board sales attributable to a 56 percent decrease in sales realizations, as well as a 2 percent decrease in sales volumes;

a $42 million decrease in engineered I-joists sales attributable to a 15 percent decrease in sales realizations, as well as a 10 percent decrease in sales volumes;

a $35 million decrease in complementary building products sales attributable to decreased sales realizations and volumes for steel, concrete and cedar, as well as decreased sales volumes for siding and trim;

a $32 million decrease in engineered solid section sales attributable to an 8 percent decrease in sales realizations, as well as a 6 percent decrease in sales volumes;

an $11 million decrease in medium density fiberboard sales attributable to a 31 percent decrease in sales volumes, partially offset by a 14 percent increase in sales realizations;

a $44 million decrease in engineered I-joists sales attributable to a 19 percent decrease in sales realizations, as well as an 11 percent decrease in sales volumes;

a $38 million decrease in complementary building products sales attributable to decreased sales volumes across most products;

a $17 million decrease in engineered solid section sales attributable to a 12 percent decrease in sales realizations, partially offset by a 5 percent increase in sales volumes;

a $10 million decrease in medium density fiberboard sales attributable to an 18 percent decrease in sales volumes, as well as a 3 percent decrease in sales realizations;

a $7 million decrease in other products produced sales attributable to decreased sales volumes for wood chips;

a $5 million decrease in softwood plywood sales attributable to a 23 percent decrease in sales realizations, partially offset by a 16 percent increase in sales volumes and

a $5 million decrease in other products produced attributable to decreased sales volumes.

a $3 million decrease in oriented strand board sales attributable to a 4 percent decrease in sales volumes, partially offset by a 4 percent increase in sales realizations.

Costs of sales

1 unchanged sentence

12 percent –

primarily due to decreased sales volumes and raw material costs across most product lines, as well as decreased freight costs.

primarily due to decreased sales volumes across most product lines, as well as decreased freight costs.

Operating income and Net contribution to earnings

6 unchanged sentences

a $1,222 million decrease in structural lumber sales attributable to a 40 percent decrease in sales realizations, as well as a 4 percent decrease in sales volumes;

a $638 million decrease in oriented strand board sales attributable to a 61 percent decrease in sales realizations, partially offset by a 3 percent increase in sales volumes;

a $92 million decrease in engineered I-joist sales attributable to a 25 percent decrease in sales volumes, as well as a 6 percent decrease in sales realizations;

an $87 million decrease in complementary building products sales attributable to decreased sales realizations and volumes for steel, concrete and cedar, as well as decreased sales volumes for siding and trim;

a $641 million decrease in oriented strand board sales attributable to a 48 percent decrease in sales realizations;

a $136 million decrease in engineered I-joist sales attributable to a 20 percent decrease in sales volumes, as well as an 11 percent decrease in sales realizations;

a $125 million decrease in complementary building products sales attributable to decreased sales volumes and sales realizations across most products;

a $76 million decrease in engineered solid section sales attributable to a 6 percent decrease in sales volumes, as well as a 5 percent decrease in sales realizations;

a $26 million decrease in softwood plywood sales attributable to a 37 percent decrease in sales realizations, partially offset by a 22 percent increase in sales volumes and

a $31 million decrease in medium density fiberboard sales attributable to a 28 percent decrease in sales volumes, partially offset by an 11 percent increase in sales realizations;

a $31 million decrease in softwood plywood sales attributable to a 33 percent decrease in sales realizations, partially offset by a 20 percent increase in sales volumes and

a $10 million decrease in other products produced attributable to decreased sales volumes.

Costs of sales

1 unchanged sentence

12 percent –

primarily due to decreased sales volumes and raw material costs across most product lines, as well as decreased freight costs.

primarily due to decreased sales volumes across most product lines, as well as decreased freight costs.

Operating income and Net contribution to earnings

6 unchanged sentences

VOLUMES IN MILLIONS (1)

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Structural lumber –

15 unchanged sentences

VOLUMES IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Structural lumber –

14 unchanged sentences

Unallocated items are gains or charges not related to, or allocated to, an individual operating segment.

Net Charge to Earnings –

3 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Unallocated corporate function and variable compensation expense

Liability classified share-based compensation

Foreign exchange gain (loss)

Foreign exchange gain

Elimination of intersegment profit in inventory and LIFO

3 unchanged sentences

Net charge to earnings

Comparing Second Quarter 2023 with Second Quarter 2022

Net charge to earnings increased $5 million –

11 percent –

primarily due to:

a $15 million increase in elimination of intersegment profit in inventory and LIFO and

a $5 million increase in other, primarily due to increased charges for environmental remediation.

These changes were partially offset by a $17 million increase in interest income and other due to an increase in the interest rate on our cash and short-term investment accounts.

Comparing Third Quarter 2023 with Third Quarter 2022

Net charge to earnings remained consistent primarily due to a $15 million increase in interest income and other due to an increase in the interest rate on our cash and short-term investment accounts, offset by a $9 million decrease in foreign exchange gain and a $6 million increase in elimination of intersegment profit in inventory and LIFO.

Comparing Year-to-Date 2023 with Year-to-Date 2022

1 unchanged sentence

40 percent –

primarily due to a $53 million decrease in elimination of intersegment profit in inventory and LIFO, as well as a $30 million increase in interest income and other due to an increase in the interest rate on our cash and short-term investment accounts.

primarily due to:

a $47 million decrease in elimination of intersegment profit in inventory and LIFO;

a $45 million increase in interest income and other due to an increase in the interest rate on our cash and short-term investment accounts and

an $11 million decrease in unallocated corporate function and variable compensation expense.

These changes were partially offset by an $11 million decrease in foreign exchange gain, as well as a $10 million increase in other primarily due to an increase in environmental remediation charges.

INTEREST EXPENSE

Our interest expense, net of capitalized interest, was:

$70 million for second quarter 2023 and $136 million year-to-date 2023;

$65 million for second quarter 2022 and $137 million year-to-date 2022.

Interest expense increased by $5 million compared to second quarter 2022 primarily due to an increase in weighted average outstanding debt in second quarter 2023.

Year-to-date 2023 interest expense was comparable to year-to-date 2022 primarily due to the May 2023 issuance of debt securities that increased our weighted average outstanding debt, offset by a series of transactions performed in March 2022 that lowered our weighted average interest rate and extended our weighted average maturity.

$72 million for third quarter 2023 and $208 million year-to-date 2023;

$67 million for third quarter 2022 and $204 million year-to-date 2022.

Interest expense increased by $5 million compared to third quarter 2022 and increased by $4 million compared to year-to-date 2022 primarily due to the May 2023 issuance of debt securities that increased our weighted average outstanding debt.

Refer to Note 8:

1 unchanged sentence

Our provision for income taxes was:

a $25 million expense for second quarter 2023 and $47 million year-to-date 2023;

a $184 million expense for second quarter 2022 and $393 million year-to-date 2022.

a $54 million expense for third quarter 2023 and $101 million year-to-date 2023;

a $77 million expense for third quarter 2022 and $470 million year-to-date 2022.

Our provision for income taxes is primarily driven by earnings generated by our TRSs.

4 unchanged sentences

We are committed to maintaining an appropriate capital structure that provides flexibility and enables us to protect the interests of our shareholders and meet our obligations to our lenders, while also maintaining access to all major financial markets.

As of June 30, 2023, we had approximately $1.1 billion in cash and cash equivalents, $665 million in short-term investments and $1.5 billion of availability on our line of credit, which expires in March 2028.

As of September 30, 2023, we had approximately $1.2 billion in cash and cash equivalents, $668 million in short-term investments and $1.5 billion of availability on our line of credit, which expires in March 2028.

We believe we have sufficient liquidity to meet our cash requirements for the foreseeable future.

4 unchanged sentences

Net cash from operations decreased $1,520 million primarily due to decreased cash inflows from our business operations.

This change was partially offset by a $336 million decrease in cash paid for income taxes.

This change was partially offset by a $406 million decrease in cash paid for income taxes, as well as a $21 million decrease in cash paid for interest.

CASH FROM INVESTING ACTIVITIES

7 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

Wood Products

7 unchanged sentences

Net cash from financing activities increased $1,643 million, primarily due to:

a $1,203 million decrease in cash used for payments on long-term debt;

a $947 million decrease in net cash used for payments on long-term debt;

a $409 million decrease in cash used for payments of dividends and

a $293 million decrease in cash used for repurchases of common stock.

These changes were partially offset by a $138 million decrease in net proceeds from issuance of long-term debt.

Line of Credit

1 unchanged sentence

Borrowings will bear interest at a floating rate based on either the adjusted term SOFR plus a spread or a mutually agreed upon base rate plus a spread.

We had no outstanding borrowings on our $1.5 billion five-year senior unsecured revolving credit facility as of June 30, 2023 or December 31, 2022.

We had no outstanding borrowings on our $1.5 billion five-year senior unsecured revolving credit facility as of September 30, 2023 or December 31, 2022.

Refer to Note 8:

1 unchanged sentence

Long-Term Debt

In July 2023, we repaid $118 million of our 7.125% notes at maturity.

We have $860 million of long-term debt scheduled to mature during fourth quarter 2023.

In May 2023, we completed an offering of debt securities by issuing $750 million of 4.750 percent notes due in May 2026.

The net proceeds after deducting the discount, underwriting fees and issuance costs were $743 million.

Of these total net proceeds, $664 million was invested in short-term debt securities which are classified as held-to-maturity.

Of these total net proceeds, $664 million was invested in short-term investments classified as held-to-maturity securities, which consist of a mixture of term deposits and Treasury bills.

In July 2023, we repaid $118 million of our 7.125 percent notes at maturity.

We have $860 million of long-term debt scheduled to mature during fourth quarter 2023, and we anticipate the majority will be funded through cash on hand, including the proceeds from our short-term investments which also mature in the fourth quarter.

In March 2022, we completed a series of transactions that lowered our weighted average interest rate and extended our weighted average maturity by issuing $900 million in notes and using the net proceeds plus cash on hand to close cash tender offers for $931 million of principal in higher interest rate notes.

6 unchanged sentences

Debt Covenants

As of June 30, 2023, Weyerhaeuser Company was in compliance with its debt covenants.

As of September 30, 2023, Weyerhaeuser Company was in compliance with its debt covenants.

There have been no significant changes to the debt covenants presented in our 2022 Annual Report on Form 10-K for our long-term debt instruments, and we expect to remain in compliance with our debt covenants for the foreseeable future.

5 unchanged sentences

Share Repurchases

We repurchased 1,689,874 common shares for approximately $50 million (including transaction fees) during second quarter 2023 and 2,805,434 common shares for approximately $85 million (including transaction fees) during year-to-date 2023 under the 2021 Repurchase Program.

During second quarter 2022, we repurchased 3,784,787 common shares for approximately $138 million (including transaction fees) and we repurchased 6,982,462 common shares for approximately $259 million (including transaction fees) during year-to-date 2022 under the 2021 Repurchase Program.

There were no unsettled shares as of June 30, 2023 and 223,548 unsettled shares (approximately $7 million) as of December 31, 2022.

We repurchased 757,510 common shares for approximately $25 million (including transaction fees) during third quarter 2023 and 3,562,944 common shares for approximately $110 million (including transaction fees) during year-to-date 2023 under the 2021 Repurchase Program.

During third quarter 2022, we repurchased 4,234,838 common shares for approximately $145 million (including transaction fees) and we repurchased 11,217,300 common shares for approximately $404 million (including transaction fees) during year-to-date 2022 under the 2021 Repurchase Program.

There were 32,757 unsettled shares (approximately $1 million) as of September 30, 2023 and 223,548 unsettled shares (approximately $7 million) as of December 31, 2022.

Refer to Note 4:

11 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Adjusted EBITDA by Segment:

5 unchanged sentences

GAAP measures for each.

The table below reconciles Adjusted EBITDA for the quarter ended June 30, 2023:

The table below reconciles Adjusted EBITDA for the quarter ended September 30, 2023:

DOLLAR AMOUNTS IN MILLIONS

8 unchanged sentences

Basis of real estate sold

Special items included in operating income (loss) (1)

Adjusted EBITDA

(1) Operating income (loss) for Unallocated Items includes a pretax special item consisting of an $11 million noncash environmental remediation charge.

The table below reconciles Adjusted EBITDA for the quarter ended June 30, 2022:

The table below reconciles Adjusted EBITDA for the quarter ended September 30, 2022:

DOLLAR AMOUNTS IN MILLIONS

9 unchanged sentences

Adjusted EBITDA

The table below reconciles Adjusted EBITDA for the year-to-date period ended June 30, 2023:

The table below reconciles Adjusted EBITDA for the year-to-date period ended September 30, 2023:

DOLLAR AMOUNTS IN MILLIONS

11 unchanged sentences

(1) Operating income (loss) for Unallocated Items includes a pretax special item consisting of an $11 million noncash environmental remediation charge.

The table below reconciles Adjusted EBITDA for the year-to-date period ended June 30, 2022:

The table below reconciles Adjusted EBITDA for the year-to-date period ended September 30, 2022:

DOLLAR AMOUNTS IN MILLIONS

18 unchanged sentences

DOLLAR AMOUNTS IN MILLIONS

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Environmental remediation charge

4 unchanged sentences

YEAR-TO-DATE ENDED

SEPTEMBER 2023

SEPTEMBER 2022

SEPTEMBER 2023

SEPTEMBER 2022

Net earnings per diluted share

5 unchanged sentences

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 1. Financial Statements