WEYERHAEUSER CO 10-Q

Item 1. FINANCIAL STATEMENTS WEYERHAEUSER COMPANY CONSOLIDATED STATEM ENT OF OPERATIONS (UNAUDITED) QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Net sales (Note 3) $ 1,681 $ 2,022 $ 5,416 $ 5,900 Costs of sales 1,431 1,520 4,407 4,560 Gross margin 250 502 1,009 1,340 Selling expenses 22 22 66 66 General and administrative expenses 122 107 358 316 Other operating costs, net (Note 13) 28 20 41 50 Operating income 78 353 544 908 Non-operating pension and other post-employment benefit costs (Note 6) ( 10 ) ( 12 ) ( 31 ) ( 33 ) Interest income and other 14 24 43 54 Interest expense, net of capitalized interest ( 69 ) ( 72 ) ( 203 ) ( 208 ) Earnings before income taxes 13 293 353 721 Income taxes (Note 14) 15 ( 54 ) ( 38 ) ( 101 ) Net earnings $ 28 $ 239 $ 315 $ 620 Earnings per share, basic and diluted (Note 4) $ 0.04 $ 0.33 $ 0.43 $ 0.85 Weighted average shares outstanding (in thousands) (Note 4): Basic 727,621 731,046 728,892 732,069 Diluted 728,180 731,742 729,355 732,542 See accompanying Notes to Consolidated Financial Statements . 1 WEYERHAEUSER COMPANY CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Net earnings $ 28 $ 239 $ 315 $ 620 Other comprehensive income: Foreign currency translation adjustments 6 ( 7 ) ( 8 ) — Changes in unamortized actuarial loss, net of tax expense of $ 3 , $ 3 , $ 9 and $ 7 6 9 21 23 Changes in unamortized net prior service credit, net of tax benefit of $ 0 , $ 0 , $ 0 and $ 1 1 — 1 1 Total other comprehensive income 13 2 14 24 Total comprehensive income $ 41 $ 241 $ 329 $ 644 See accompanying Notes to Consolidated Financial Statements . 2 WEYERHAEUSER COMPANY CONSOLIDATED BALANCE SHEET (UNAUD ITED) DOLLAR AMOUNTS IN MILLIONS, EXCEPT PAR VALUE SEPTEMBER 30, 2024 DECEMBER 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 877 $ 1,164 Receivables, net 373 354 Receivables for taxes 10 10 Inventories (Note 5) 592 566 Prepaid expenses and other current assets 142 219 Total current assets 1,994 2,313 Property and equipment, less accumulated depreciation of $ 3,935 and $ 3,901 2,247 2,269 Construction in progress 316 270 Timber and timberlands at cost, less depletion 11,502 11,528 Minerals and mineral rights, less depletion 192 200 Deferred tax assets 13 15 Other assets 404 388 Total assets $ 16,668 $ 16,983 LIABILITIES AND EQUITY Current liabilities: Current maturities of long-term debt (Note 8) $ 210 $ — Accounts payable 275 287 Accrued liabilities (Note 7) 507 501 Total current liabilities 992 788 Long-term debt, net (Note 8) 4,864 5,069 Deferred tax liabilities 78 81 Deferred pension and other post-employment benefits (Note 6) 462 461 Other liabilities 345 348 Total liabilities 6,741 6,747 Commitments and contingencies (Note 10) Equity: Common shares: $ 1.25 par value; authorized 1,360 million shares; issued and outstanding: 726,758 thousand shares at September 30, 2024 and 729,753 thousand shares at December 31, 2023 909 912 Other capital 7,517 7,608 Retained earnings 1,780 2,009 Accumulated other comprehensive loss (Note 11) ( 279 ) ( 293 ) Total equity 9,927 10,236 Total liabilities and equity $ 16,668 $ 16,983 See accompanying Notes to Consolidated Financial Statements . 3 WEYERHAEUSER COMPANY CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED) YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 Cash flows from operations: Net earnings $ 315 $ 620 Noncash charges (credits) to earnings: Depreciation, depletion and amortization 376 374 Basis of real estate sold 93 80 Pension and other post-employment benefits (Note 6) 46 50 Share-based compensation expense (Note 12) 32 26 Other ( 3 ) ( 4 ) Change in: Receivables, net ( 21 ) ( 77 ) Receivables and payables for taxes ( 3 ) 51 Inventories ( 31 ) 23 Prepaid expenses and other current assets 20 ( 5 ) Accounts payable and accrued liabilities ( 1 ) 43 Pension and post-employment benefit contributions and payments ( 12 ) ( 16 ) Other ( 21 ) ( 20 ) Net cash from operations 790 1,145 Cash flows from investing activities: Capital expenditures for property and equipment ( 228 ) ( 209 ) Capital expenditures for timberlands reforestation ( 39 ) ( 42 ) Acquisitions of timberlands (Note 15) ( 135 ) ( 70 ) Purchase of short-term investments — ( 664 ) Other 21 3 Net cash from investing activities ( 381 ) ( 982 ) Cash flows from financing activities: Cash dividends on common shares ( 539 ) ( 1,076 ) Net proceeds from issuance of long-term debt (Note 8) — 743 Payments on long-term debt (Note 8) — ( 118 ) Repurchases of common shares (Note 4) ( 126 ) ( 109 ) Other ( 9 ) ( 11 ) Net cash from financing activities ( 674 ) ( 571 ) Net change in cash, cash equivalents and restricted cash ( 265 ) ( 408 ) Cash, cash equivalents and restricted cash at beginning of period 1,164 1,581 Cash, cash equivalents and restricted cash at end of period $ 899 $ 1,173 Cash paid during the period for: Interest, net of amount capitalized of $ 7 and $ 5 $ 189 $ 190 Income taxes, net of refunds $ 51 $ 40 See accompanying Notes to Consolidated Financial Statements . 4 WEYERHAEUSER COMPANY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED) QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER-SHARE FIGURES SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Common shares: Balance at beginning of period $ 910 $ 914 $ 912 $ 916 Issued for exercise of stock options and vested units — — 2 2 Repurchases of common shares (Note 4) ( 1 ) ( 1 ) ( 5 ) ( 5 ) Balance at end of period 909 913 909 913 Other capital: Balance at beginning of period 7,530 7,624 7,608 7,691 Issued for exercise of stock options 1 1 4 3 Repurchases of common shares (Note 4) ( 25 ) ( 24 ) ( 120 ) ( 105 ) Share-based compensation 10 9 32 26 Other transactions, net 1 ( 1 ) ( 7 ) ( 6 ) Balance at end of period 7,517 7,609 7,517 7,609 Retained earnings: Balance at beginning of period 1,897 1,828 2,009 2,389 Net earnings 28 239 315 620 Dividends on common shares ( 145 ) ( 138 ) ( 544 ) ( 1,080 ) Balance at end of period 1,780 1,929 1,780 1,929 Accumulated other comprehensive loss: Balance at beginning of period ( 292 ) ( 225 ) ( 293 ) ( 247 ) Other comprehensive income 13 2 14 24 Balance at end of period (Note 11) ( 279 ) ( 223 ) ( 279 ) ( 223 ) Total equity: Balance at end of period $ 9,927 $ 10,228 $ 9,927 $ 10,228 Dividends paid per common share $ 0.20 $ 0.19 $ 0.74 $ 1.47 See accompanying Notes to Consolidated Financial Statements . 5 INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS NOTE 1: BASIS OF PRESENTATION 7 NOTE 2: BUSINESS SEGMENTS 7 NOTE 3: REVENUE RECOGNITION 8 NOTE 4: NET EARNINGS PER SHARE AND SHARE REPURCHASES 8 NOTE 5: INVENTORIES 9 NOTE 6: PENSION AND OTHER POST-EMPLOYMENT BENEFIT PLANS 10 NOTE 7: ACCRUED LIABILITIES 10 NOTE 8: LONG-TERM DEBT AND LINE OF CREDIT 10 NOTE 9: FAIR VALUE OF FINANCIAL INSTRUMENTS 11 NOTE 10: LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES 11 NOTE 11: ACCUMULATED OTHER COMPREHENSIVE LOSS 12 NOTE 12: SHARE-BASED COMPENSATION 12 NOTE 13: OTHER OPERATING COSTS, NET 13 NOTE 14: INCOME TAXES 13 NOTE 15: TIMBERLAND ACQUISITONS 13 NOTE 16: RESTRICTED CASH 13 6 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) FOR THE QUARTERS AND YEAR-TO-DATE PERIODS ENDED SEPTEMBER 30, 2024 AND 2023 NOTE 1: BASIS O F PRESENTATION Our consolidated financial statements provide an overall view of our results of operations, financial condition and cash flows. They include our accounts and the accounts of entities we control, including majority-owned domestic and foreign subsidiaries. They do not include our intercompany transactions and accounts, which are eliminated. Throughout these Notes to Consolidated Financial Statements, unless specified otherwise, references to “Weyerhaeuser,” “the company,” “we” and “our” refer to the consolidated company. The accompanying unaudited Consolidated Financial Statements reflect all adjustments that are, in the opinion of management, necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods presented. Except as otherwise disclosed in these Notes to Consolidated Financial Statements, such adjustments are of a normal, recurring nature. The Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission pertaining to interim financial statements. Certain information and footnote disclosures normally included in our annual Consolidated Financial Statements have been condensed or omitted. These quarterly Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2023 . Results of operations for interim periods should not necessarily be regarded as indicative of the results that may be expected for the full year. NOTE 2: BUSIN ESS SEGMENTS We are principally engaged in growing and harvesting timber; maximizing the value of our acreage through the sale of higher and better use (HBU) properties; monetizing the value of surface and subsurface assets through leases and royalties; and manufacturing, distributing and selling products made from trees. Our business segments are organized based primarily on products and services which include: ● Timberlands – Logs, timber, recreational leases and other products; ● Real Estate, Energy and Natural Resources (Real Estate & ENR) – Real Estate (sales of timberlands) and ENR (rights to explore for and extract hard minerals, construction materials, natural gas production and wind and solar) and ● Wood Products – Structural lumber, oriented strand board, engineered wood products and building materials distribution. A reconciliation of our business segment information to the respective information in the Consolidated Statement of Operations is as follows: QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Sales to unaffiliated customers: Timberlands $ 357 $ 380 $ 1,153 $ 1,259 Real Estate & ENR 89 105 305 286 Wood Products 1,235 1,537 3,958 4,355 1,681 2,022 5,416 5,900 Intersegment sales: Timberlands 136 141 416 433 Total sales 1,817 2,163 5,832 6,333 Intersegment eliminations ( 136 ) ( 141 ) ( 416 ) ( 433 ) Total $ 1,681 $ 2,022 $ 5,416 $ 5,900 Net contribution (charge) to earnings: Timberlands $ 57 $ 78 $ 218 $ 302 Real Estate & ENR 51 56 170 161 Wood Products 27 277 351 590 135 411 739 1,053 Unallocated items (1) ( 53 ) ( 46 ) ( 183 ) ( 124 ) Net contribution to earnings 82 365 556 929 Interest expense, net of capitalized interest ( 69 ) ( 72 ) ( 203 ) ( 208 ) Earnings before income taxes 13 293 353 721 Income taxes 15 ( 54 ) ( 38 ) ( 101 ) Net earnings $ 28 $ 239 $ 315 $ 620 (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. 7 NOTE 3: REVENU E RECOGNITION A reconciliation of revenue recognized by our major products: QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Net sales to unaffiliated customers: Timberlands segment Delivered logs: West Domestic sales $ 78 $ 96 $ 269 $ 290 Export grade sales 80 80 270 321 Subtotal West 158 176 539 611 South 149 155 453 485 North 11 11 33 35 Subtotal delivered logs sales 318 342 1,025 1,131 Stumpage and pay-as-cut timber 14 12 38 43 Recreational and other lease revenue 19 19 57 54 Other (1) 6 7 33 31 Net sales attributable to Timberlands segment 357 380 1,153 1,259 Real Estate & ENR segment Real estate 59 79 220 198 Energy and natural resources 30 26 85 88 Net sales attributable to Real Estate & ENR segment 89 105 305 286 Wood Products segment Structural lumber 451 570 1,414 1,658 Oriented strand board 206 284 749 707 Engineered solid section 175 216 543 600 Engineered I-joists 95 122 301 335 Softwood plywood 38 42 121 127 Medium density fiberboard 42 40 123 120 Complementary building products 158 184 475 551 Other (2) 70 79 232 257 Net sales attributable to Wood Products segment 1,235 1,537 3,958 4,355 Total net sales $ 1,681 $ 2,022 $ 5,416 $ 5,900 (1) Other Timberlands sales include sales of seeds and seedlings from our nursery operations as well as wood chips. (2) Other Wood Products sales include wood chips, other byproducts and third-party residual log sales from our Canadian Forestlands operations. NOTE 4: NET EARNINGS PER SHARE AND SHARE REPURCHASES Our basic and diluted earnings per share were: ● $ 0.04 during third quarter 2024 and $ 0.43 during year-to-date 2024; ● $ 0.33 during third quarter 2023 and $ 0.85 during year-to-date 2023. 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. Diluted earnings per share is net earnings divided by the sum of the weighted average number of our outstanding common shares and the effect of our outstanding dilutive potential common shares. 8 QUARTER ENDED YEAR-TO-DATE ENDED SHARES IN THOUSANDS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Weighted average common shares outstanding – basic 727,621 731,046 728,892 732,069 Dilutive potential common shares: Stock options 95 154 115 134 Restricted stock units 329 304 203 117 Performance share units 135 238 145 222 Total effect of outstanding dilutive potential common shares 559 696 463 473 Weighted average common shares outstanding – dilutive 728,180 731,742 729,355 732,542 We use the treasury stock method to calculate the dilutive effect of our outstanding stock options, restricted stock units and performance share units. Potential Shares Not Included in the Computation of Diluted Earnings per Share The following shares were not included in the computation of diluted earnings per share because they were either antidilutive or the required performance or market conditions were not met. Some or all of these shares may be dilutive potential common shares in future periods. QUARTER ENDED YEAR-TO-DATE ENDED SHARES IN THOUSANDS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Stock options 607 609 607 609 Performance share units 892 612 892 612 Share Repurchase Program On September 22, 2021, we announced that our board of directors approved a new share repurchase program (the 2021 Repurchase Program) under which we are authorized to repurchase up to $ 1 billion of outstanding shares. 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 820,706 common shares for approximately $ 26 million (including transaction fees) under the 2021 Repurchase Program during third quarter 2024 and 3,962,220 common shares for approximately $ 125 million (including transaction fees) under the 2021 Share Repurchase Program during year-to-date 2024. During third quarter 2023, we repurchased 757,510 common shares for approximately $ 25 million (including transaction fees) and 3,562,944 common shares for approximately $ 110 million (including transaction fees) during year-to-date 2023 under the 2021 Repurchase Program. As of September 30, 2024, we had remaining authorization of $ 127 million for future share repurchases. All common stock repurchases under the 2021 Repurchase Program were made in open-market transactions. We record share repurchases upon trade date as opposed to the settlement date when cash is disbursed. We record a liability for repurchases that have not yet been settled as of period end. There were 11,564 unsettled shares (less than $ 1 million) as of September 30, 2024 and 13,866 unsettled shares (approximately $ 1 million) as of December 31, 2023 . NOTE 5: IN VENTORIES Inventories include raw materials, work-in-process and finished goods, as well as materials and supplies. DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 30, 2024 DECEMBER 31, 2023 LIFO inventories: Logs $ 23 $ 29 Lumber, plywood, oriented strand board and fiberboard 74 77 Other products 13 12 Moving average cost or FIFO inventories: Logs 22 49 Lumber, plywood, oriented strand board, fiberboard and engineered wood products 124 115 Other products 178 134 Materials and supplies 158 150 Total $ 592 $ 566 LIFO – the last-in, first-out method – applies to major inventory products held at our U.S. locations. The moving average cost method or FIFO – the first-in, first-out method – applies to the balance of our U.S. raw material and product inventories, all material and supply inventories and all foreign inventories. 9 NOTE 6: PENSION AND OTHER PO ST-EMPLOYMENT BENEFIT PLANS The components of net periodic benefit cost are: PENSION QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Service cost $ 5 $ 6 $ 15 $ 17 Interest cost 29 30 87 89 Expected return on plan assets ( 31 ) ( 30 ) ( 92 ) ( 90 ) Amortization of actuarial loss 12 10 32 29 Amortization of prior service cost — — 1 1 Total net periodic benefit cost – pension $ 15 $ 16 $ 43 $ 46 OTHER POST-EMPLOYMENT BENEFITS QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Interest cost $ 1 $ 2 $ 3 $ 4 Amortization of actuarial loss — — 1 1 Amortization of prior service credit ( 1 ) — ( 1 ) ( 1 ) Total net periodic benefit cost – other post-employment benefits $ — $ 2 $ 3 $ 4 For the periods presented, service cost is included in “Costs of sales,” “Selling expenses,” and “General and administrative expenses” with the remaining components included in “Non-operating pension and other post-employment benefit costs” in the Consolidated Statement of Operations . Fair Value of Pension Plan Assets and Obligations In our year-end reporting process, we estimate the fair value of pension plan assets based upon the information available at that time. For certain assets, primarily private equity funds, the information available consists of net asset values as of an interim date, cash flows between the interim date and the end of the year and market events. We evaluate the year-end estimated fair value of pension plan assets in the second quarter of each year to incorporate final net asset values reflected in financial statements received after we have filed our Annual Report on Form 10-K. No adjustments to the fair value of assets or projected benefit obligations were necessary during second quarter 2024 . NOTE 7: ACCRU ED LIABILITIES Accrued liabilities were comprised of the following: DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 30, 2024 DECEMBER 31, 2023 Compensation and employee benefit costs $ 171 $ 173 Current portion of lease liabilities 22 19 Customer rebates, volume discounts and deferred income 130 124 Interest 66 63 Taxes payable 47 31 Other 71 91 Total $ 507 $ 501 NOTE 8: LONG-TERM DEBT AND LINE OF CREDIT 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 . The net proceeds after deducting the discount, underwriting fees and issuance costs were $ 743 million. In March 2023, we refinanced and extended our $ 1.5 billion five-year senior unsecured revolving credit facility, which expires in March 2028 . 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 outstanding borrowings on our credit facility as of September 30, 2024 and December 31, 2023 . 10 NOTE 9: FAIR VALUE OF FINANCIAL INSTRUMENTS The estimated fair value and carrying value of our long-term debt consisted of the following: SEPTEMBER 30, 2024 DECEMBER 31, 2023 DOLLAR AMOUNTS IN MILLIONS CARRYING VALUE FAIR VALUE (LEVEL 2) CARRYING VALUE FAIR VALUE (LEVEL 2) Long-term debt (including current maturities) and line of credit: Fixed rate $ 4,825 $ 4,897 $ 4,820 $ 4,853 Variable rate 249 250 249 250 Total debt $ 5,074 $ 5,147 $ 5,069 $ 5,103 To estimate the fair value of fixed rate long-term debt, we used the market approach, which is based on quoted market prices we received for the same types and issues of our debt. We believe that our variable-rate long-term debt and line of credit instruments have net carrying values that approximate their fair value with only insignificant differences. The inputs to the valuations of our long-term debt are based on market data obtained from independent sources or information derived principally from observable market data. The difference between the fair value and the carrying value represents the theoretical net premium or discount we would pay or receive to retire all debt at the measurement date. Fair Value of Other Financial Instruments We believe that our other financial instruments, including cash and cash equivalents, short-term investments, receivables and payables, have net carrying values that approximate their fair values with only insignificant differences. This is primarily due to the short-term nature of these instruments and the allowance for doubtful accounts. NOTE 10: LEGAL PROCEEDINGS, C OMMITMENTS AND CONTINGENCIES Legal Proceedings We are party to various legal proceedings arising in the ordinary course of business. We are not currently a party to any legal proceeding that management believes could have a material adverse effect on our Consolidated Statement of Operations , Consolidated Balance Sheet or Consolidated Statement of Cash Flows . Environmental Matters Site Remediation Under the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) – commonly known as the “Superfund” – and similar state laws, we: ● are a party to various proceedings related to the cleanup of hazardous waste sites and ● 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 September 30, 2024, our total accrual for future estimated remediation costs on active Superfund sites and other sites for which we are potentially responsible was approximately $ 80 million. These amounts are recorded in "Accrued liabilities" and "Other liabilities" on our Consolidated Balance Sheet . 11 NOTE 11: ACCUMULATED OT HER COMPREHENSIVE LOSS Changes in amounts included in our accumulated other comprehensive loss by component are: QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Pension (1) Balance at beginning of period $ ( 498 ) $ ( 444 ) $ ( 515 ) $ ( 458 ) Other comprehensive loss before reclassifications ( 1 ) — — ( 1 ) Amounts reclassified from accumulated other comprehensive loss to earnings (2) 9 9 25 24 Total other comprehensive income 8 9 25 23 Balance at end of period $ ( 490 ) $ ( 435 ) $ ( 490 ) $ ( 435 ) Other post-employment benefits (1) Balance at beginning of period $ 22 $ 21 $ 24 $ 20 Other comprehensive loss before reclassifications — ( 1 ) ( 3 ) — Amounts reclassified from accumulated other comprehensive loss to earnings (2) ( 1 ) 1 — 1 Total other comprehensive (loss) income ( 1 ) — ( 3 ) 1 Balance at end of period $ 21 $ 21 $ 21 $ 21 Translation adjustments and other Balance at beginning of period $ 184 $ 198 $ 198 $ 191 Translation adjustments 6 ( 7 ) ( 8 ) — Total other comprehensive income (loss) 6 ( 7 ) ( 8 ) — Balance at end of period 190 191 190 191 Accumulated other comprehensive loss, end of period $ ( 279 ) $ ( 223 ) $ ( 279 ) $ ( 223 ) (1) Amounts presented are net of tax. (2) Amounts of actuarial loss and prior service (cost) credit are components of net periodic benefit cost. See Note 6: Pension and Other Post-Employment Benefit Plans . NOTE 12: SHARE-B ASED COMPENSATION Share-based compensation activity during year-to-date 2024 included the following: SHARES IN THOUSANDS GRANTED VESTED Restricted stock units (RSUs) 915 688 Performance share units (PSUs) 412 317 A total of 749 thousand shares of common stock were issued as a result of RSU and PSU vestings. Restricted Stock Units The weighted average fair value of the RSUs granted in 2024, calculated as an average of the high and low prices on grant date, was $ 32.92 . The vesting provisions for RSUs granted in 2024 were consistent with prior year grants. Performance Share Units The weighted average grant date fair value of PSUs granted in 2024 was $ 37.90 . The final number of shares granted in 2024 will vest between a range of 0 percent to 150 percent of each grant's target, depending upon actual company total shareholder return (TSR) compared against the TSR of an industry peer group. TSR assumes full reinvestment of dividends. PSUs granted in 2024 will vest at a maximum of 100 percent of target value in the event of negative absolute company TSR. Weighted Average Assumptions Used in Estimating the Value of Performance Share Units Granted in 2024 PERFORMANCE SHARE UNITS Performance period 2/09/2024 – 12/31/2026 Valuation date closing stock price $ 33.28 Risk-free rate 4.19 % – 4.27 % Expected volatility 21.50 % – 27.60 % 12 NOTE 13: OTHER OPERAT ING COSTS, NET Other operating costs, net were comprised of the following: QUARTER ENDED YEAR-TO-DATE ENDED DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 2024 SEPTEMBER 2023 SEPTEMBER 2024 SEPTEMBER 2023 Environmental remediation charges $ 2 $ 1 $ 8 $ 14 Litigation expense, net 12 9 30 11 Product remediation recovery — — ( 25 ) — Research and development expenses 1 2 5 5 Restructuring, impairments and other charges 10 — 10 — Other, net 3 8 13 20 Total other operating costs, net $ 28 $ 20 $ 41 $ 50 Asset Impairment During third quarter 2024, we recorded a $ 10 million noncash impairment charge related to the indefinite curtailment of our New Bern lumber mill. The loss was attributable to our Wood Products segment and was recorded within “Other operating costs, net” in our Consolidated Statement of Operations . NOTE 14: INCOME TAXES As a real estate investment trust (REIT), we generally are not subject to federal corporate income taxes on REIT taxable income that is distributed to shareholders. We are required to pay corporate income taxes on earnings of our Taxable REIT Subsidiaries (TRSs), which include our Wood Products segment and a portion of our Timberlands and Real Estate & ENR segments. The quarterly provision for income taxes is based on our current estimate of the annual effective tax rate and is adjusted for discrete taxable events that have occurr ed during the year. Our 2024 estimated annual effective tax rate, excluding discrete items, differs from the U.S. federal statutory tax rate of 21 percent p rimarily due to state and foreign income taxes and tax benefits associated with our nontaxable REIT earnings. N OTE 15: TIMBERLAND ACQUISITIONS On July 25, 2024, we announced acquisitions totaling 84 thousand acres of Alabama timberlands for $ 244 million. The first transaction was completed on May 30, 2024 and was comprised of 13 thousand acres for $ 48 million. We recorded $ 47 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . The second transaction was completed o n August 28, 2024 and was comprised of 32 thousand acres for $ 82 million. We recorded $ 81 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . The third transaction was completed on October 9, 2024 and was comprised of 39 thousand acres for $ 114 million. On July 19, 2023, we completed the purchase of 22 thousand acres of Mississippi timberlands for $ 60 million. We recorded $ 59 million of timberland assets in "Timber and timberlands at cost, less depletion" and $ 1 million of related assets in "Property and equipment, net" on our Consolidated Balance Sheet . NOTE 16: RESTRICTED CASH The following table provides a reconciliation of cash, cash equivalents and restricted cash reported on our Consolidated Balance Sheet that sum to the total of the amounts shown in the Consolidated Statement of Cash Flows : DOLLAR AMOUNTS IN MILLIONS SEPTEMBER 30, 2024 SEPTEMBER 30, 2023 Cash and cash equivalents $ 877 $ 1,173 Restricted cash included in other assets (1) 22 — Total cash, cash equivalents and restricted cash $ 899 $ 1,173 (1) Amounts included in restricted cash as of September 30, 2024 are comprised of proceeds held by a qualified intermediary that were subsequently reinvested in timber and timberlands through a like-kind exchange transaction. 13