PotlatchDeltic (PCH) 31 Oct 232023 Q3 Earnings call transcript

Good morning. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the PotlatchDeltic Third Quarter 2023 Conference Call. [Operator Instructions] I would now like to turn the call over to Mr. Wayne Wasechek, Vice President and Chief Financial Officer, for opening remarks. proceed. may you Sir,

welcome Third and Conference XXXX Call. to morning, Quarter PotlatchDeltic's Earnings Good

the Cremers, is Chief me call Joining on Eric Executive PotlatchDeltic's Officer. and President

www.potlatchdeltic.com. warning our with release reconciliation can This in with and that the will contain a the statements. of website statements. filings review call be risks Also, regarding associated note forward-looking in our measures our forward-looking found our on the press at SEC presentation these on slides non-GAAP Please statements please

the to our and quarter over turn then I results comments, I'll for some call Eric outlook. will third review and

you, Thank Wayne.

Looking segments results, market EBITDDA closed our to . quarter. compared all improved reported the of solid These total across results reflect the second at adjusted third quarter yesterday. financial after business $XX our million performance we of

segment's results. Our second in million was were the of EBITDDA to in primary average prices $XX the compared quarter the lumber adjusted driver Wood improved Products third $XX quarter. higher Slightly million the

steady hovers composite housing affordability We by confidence. We including $XXX lumber bottom rates, interest seen out late starting lumber higher are X,XXX several and range. upper price ongoing as in declining driven foot prices in peaking a composite believe challenges consumer July, have in to since the headwinds, price decline lumber per the the board

macroeconomic continue remain. long-term optimistic demand housing overall about business, to but concerns remain for We fundamentals that our drive

to below expand was executing shipped plan, year. Arkansas feet quarter, and last third volume million capital in focused slightly which the we shipped million For our the remain $XXX on of lumber Waldo, in board shipped We QX million we project including but project of modernize we XXX than sawmill. our more XX our QX, feet

project, end XXXX. major milestones to which the to track hit Waldo continue be of We completed by is the on on our

approximately project The to XXXX in significantly annual downtime expected existing during will the X the in million increase new and continue mill the capacity to operate costs. reduce equipment. feet will cash weeks mills with of XX board by mill's tie The project the

$XX compared adjusted the generated million segment quarter in million in EBITDDA third Timberlands $XX Our of the second quarter. to

third conditions our X high our logging record good in achieving quarter, execution combined Dryer QX harvested in million resulted of with harvest for forecast We in setting range. our by tons Timberlands end volume team, quarterly Southern a business. the the

sawlog quarter. Southern during third remained markets and pulpwood the stable

estate in adjusted real EBITDDA our $XX Our contributed million results. quarter third to segment

On the acres rural side $X,XXX at of per X,XXX sold business, acre. the we over

values. demand to rural continue properties at to for see core We strong significant timberland premiums

half real timberlands stratification team of CatchMark our our the business' acquired to CatchMark capitalized recent as estate rural Additionally, quarterly the was portfolio. on nearly of performance our attributable

completed our side and our $XX,XXX we price an per the sold Valley lot of land master-planned lots sale for at residential commercial Chenal On $X.X million. estate XX of development business, real average in community a

on have by We offerings. year, good starting Chenal majority our in our are Valley had builders slowing for of regional of on to this of but modest absorption signs lot see the lot the new offerings take-up we

climate Turning to opportunities. solution natural

area. this We in continue to build momentum

hardwood progress of the good project on making our is credit approximately XX,XXX acres team timberlands Our low-lying carbon on South. in

We carbon high-quality are credits. establish currently the a process reputable firm very through working with certification to

credit the quarter of around with the certification completing sold the following anticipate We midyear. end the the of market envision to by and process first immediately submission next the year, having

pulpwood opportunities providers exploring residuals to manufacturers, supply and develop biofuel and also are NCS other mill We bioenergy producers.

less sale under We in and acreage. deals, basis of the representing from lease solar contract, for we South. of farm than continue a developers $XXX strong solar our As see options million on nearly value have to net now X% interest timberland solar present land

the in our believe net a values we and since these demand In natural solar $XX new land quarter, our present have drive option with X million the rural will contracts all opportunities for timberland climate solutions We increase last aggregate. higher. value of executed fact, of

mortgage Shifting With environment. prospective historically in Demand resilient to existing a inventory level low housing. for are of sale homebuyers million year. home units a versus new elevated despite run construction for around has home, residential an rate the starts single-family purchasing at remained housing rate, U.S. looking last though from $X.X year's new million down existing hovered $X.X home this unit have an

persistently are home confidence. been a demand relatively toll has taking on of high new over year, residential rates course stable the While this homebuilders mortgage

weighing and couple sentiment on X for the higher homebuilder of will downward shortage are increasing months. a demographics and continue $X and underlying an units tailwinds of rates, are to affordability which last to remain reversed mortgage million over million the overall housing on in between course trended housing fundamentals, which the the housing U.S. uncertainty economy months housing our including housing which Current beginning approaching we favorable positive has of of row, this business. But and provide direction longer-term on year, for be After demand some market. estimate drive X%, in January to headwinds, $X We believe positive demand. stock,

moving this optimistic high new will home we rates temper existing support the home interest market. housing doubt, following No by higher and their segment. segment. the this stock, repair in been and renovating home R&R and area are repair aging the interest market year, work and to rate remodel over strong, equity homes remodel is Demand into Turning existing versus has remain in that market it sales We staying but and that expect high and remain in homeowners being also believe and a in and model spending environment, solid. to supported levels we repair this coming remote the

remain home strong and year. continues last is In to fact, center XX% over our up year-to-date takeaway

XXX,XXX for third Moving since quarter end additional to the for during shares capital XXX,XXX $XX allocation. the repurchased of We repurchased $XX and shares an million million September.

plan. under XXbX-X repurchased shares these our of were per average of $XX All for an share

remaining shares to and $XXX issue we assets including existing strategic follow allocation million additional an on We strategy, disciplined authorization. when we have when repurchase capital acquire repurchase shares. our We a

shares we share, we we and merger, at value to shares our million which not remain towards is For X.X our example, estimated have hastily value. we well $XX below allocation disciplined valued million our CatchMark per will all believe the time, net evaluate we entered and continue to repurchased the our for price of capital merger average Since $XX asset shareholder opportunistic our and of of in at when approach. to into act of any options will per continually grow in announced share acquisition. $XX May the we utilized an fund XXXX, We opportunities over

and to our publication May, in the fourth second our addition annual reporting, and ESG report Regarding governance carbon of in early report in annual environmental, climate social we issued October.

items, committed potential and strong impact responsibility other our scenarios climate underway PotlatchDeltic the to and among Southeast these of highlights, we environmental report climate and areas. and on in of timberlands and and initiatives governance our social areas. change proud sourcing carbon is the various are progress we Lake Our have practices state our

my high-quality an wrap and To assets. comments, to continues very PotlatchDeltic of with up be well portfolio sheet investment-grade a balance positioned

opportunistic shareholder as value term. maintain to We will we disciplined the continue and seek over long maximize capital strategy to allocation a

and it turn results now our I to quarter outlook. our over to discuss third will Wayne

quarter. color quarter. quarter I with in primarily slides. EBITDDA in the third Idaho seasonally our increased quarter $XX seasonally X compared the operating in and third of and quarter. We results. in second provide is the review the in Information now segments on more was quarter. through was for volume second volumes $XX quarter-over-quarter our the than on higher segment's from of in of Starting EBITDDA million Idaho driven third X you, Slides harvested This The tons million each $XX quarter in sawlog to The million harvested Thank Eric. we the Timberlands to Adjusted harvest segment improved tons adjusted the EBITDDA Page prices. increase third XXX,XXX that Indexed million by XXX,XXX is $XX higher displayed our X. in sawlogs the will second

increased sawlog Idaho the the for higher prices a XX% The prices on of was third quarter. to result basis the index increase per Our ton second in quarter compared sawlog sawlogs. in prices

prices and to index primarily third prices, X.X third slightly South, lumber harvested the we Our which on quarter index second tons in reset June the X.X in the lag, million quarter compared X-month In means tons higher a July. quarter. million in reflect prices the

quarter the sawlog flat to second third quarter. prices were in Southern compared Our the

to on million Products Slides Adjusted million increased from second Turning quarter $XX to Wood X EBITDDA third in and quarter. the in X. $XX the

in from X% the Our per average per feet second $XXX realizations XXX feet in increased X,XXX quarter board board third to the quarter. price X,XXX lumber

Our the X% third average consistent in of first the X were prices before approximately declining quarter with lumber September. months

quarter XXX second and were in in Lumber feet realizations million compared per price million in Our XXX the feet in average quarter. board thousand feet were to shipments board the in August July, third XXX XXX board September. lumber XXX

third slightly basis were on timing result drove lower margins. primarily log of the per Higher a shipments and costs of unit shipments improved a lumber quarter. the versus Our realizations second in-transit the in as lower quarter,

due XX. prior Shifting quarter. adjusted increase EBITDDA segment's to the to acres to compared Slides estate the $XX more in to million second on in was real rural the compared sale third and The The million XX $XX was quarter. the of quarter

of team of properties recent the to of market real bringing a following job CatchMark did completion Our a good portfolio. the estate stratification

EBITDDA generated in nearly to business' the plan a by Rural lower quarter sales real community. business estate half to contributed due quarter. Parcels at was sold acres Valley CatchMark second of our quarter fewer residential our sale lot the master and this our commercial Chenal in performance The compared to third development decrease

points. in of on the different due second at million commercial During residential of in we average a in second in closed third the price Also, quarter. mix the quarter the recorded price XX third revenue a lower lot to quarter, compared almost quarter million $X $X we sale to lots over the than

capital summarized on XX. Slide Turning which to structure, is

on of end was This of amount that of Our this as scheduled $XXX $XX million. plan revolver. We $XXX total million to at undrawn refinance year. in September mature the cash availability well liquidity the million December our to on as balance sheet, is debt our of includes

effectively have lenders swaps. existing in interest refinance after starting rate locked patronage rate the credits a from X.X% approximately We forward using of portion at our and

annual cash interest to forward we refinancing, current starting will us swaps and this swaps have afford interest to $XXX,XXX December. by to lower beginning future rates million our rate deploy our allows low. well this debt $XXX After at keep approximately our below still refinance costs notional in borrowing market of Utilization

shares XXX,XXX at third for total repurchased We $XX the of in quarter. a $XX million share per

continue quarter we repurchase the share to our repurchase ended. Additionally, plan after shares XXbX-X under

leaves which quarter, $XX we remaining million. for shares on with excludes from XXX,XXX of our million for Capital total XXX,XXX total our amount So cash which expenditures, the $XXX of have $XX we in at repurchased million, flow shares Therefore, far statement a in the and fourth repurchased are in us share per million estate development timberland year-to-date, million $XX were have quarter. $XXX expenditures in $XX real authorization. third cash That repurchase includes a acquisitions. included operations

are to potential spend to For $XXX we the planning full million excluding acquisitions. million, any year, $XXX

includes for project. Waldo, CapEx million Our modernization approximately the sawmill expansion estimate $XX Arkansas

quarter, Ola During the for of carriers insurance our deductible. net finalized million, we our a fire sawmill a $XX with third $X total million of insurance claim

and resulted the insurance during quarter. in recoveries recognition $XX remaining sawmill. covered of replacement insurance property the third Finalization business claim Our of claim the interruption of million the both at the

this the $XX remaining of prior reminder, with XXXX a year. million we As recorded the recognized $XX million settlement to

now some are provide details outlook We'll The Slide high-level XX. on presented comments.

to X.X quarter, year. compared planned million annual our quarter to forward be fourth in to in to harvest to the tons harvest earlier able in volumes our a the X.X of lower third portion to the as planned North the segment Timberland in fourth million volumes Harvest our was team in are the expect We quarter. pull

decline about quarter, in We heavier index XX% logs. fourth the seasonally lower and to XX% expect sawlog Northern to sawlog reflecting prices prices

to harvest South, In the million X.X the approximately fourth we plan tons quarter. in

XXX ship million flat quarter. the the third quarter. to sawlog be end to prices in segment, fourth quarter. to plan board for In trend Products We in of the our prices expect quarter continued the fourth to third million Southern we lumber Wood feet lumber downwards since of have Benchmark XXX to our the

lumber our Our price of feet approximately of far XXX approximately board This in than fourth is million shipments price. quarter the lower thus based average is average quarter lumber. on XX% third lumber

real to Moving estate.

in land sell We of approximately quarter. expect to X,XXX rural acres the fourth

residential indications we for Valley. in softening lot of As new in the sales, construction are Chenal residential seeing market

the quarter XXX are full year for We in number of approximately approximately of reducing XXXX. anticipated lots XX% the our fourth and

the on provided estate real Additional are slide. details

we This quarter expectations the Idaho Indexed based fourth on anticipate be and lower of lower prices. sawlog total Overall, our adjusted is EBITDDA quarter. to lumber the in to the third compared

in high to term. Looking near rates mortgage and the uncertainty continue will market forward, challenge the housing macroeconomic

remain fundamentals over are we positioned growing However, the and bullish term. housing to long on we continue believe shareholder well longer-term value

concludes would That to open now Sarah, like our the prepared to I Q&A. remarks. call

question first Your of the Citi Pettinari Research. Instructions] comes [Operator with line Anthony from

drivers? reductions, you did capacity is Arkansas there Good flat any of of XQ. XQ you to I versus Or kind like from morning. And Was same sawlog of looks where kind think see adds, realizations supply in Or any in this maybe sawmill fairly submarkets flag strength It the expect regions? Southern relative any like differences, kind consistent the across you'd portfolio? CatchMark were Southern the other XQ. or

No.

region, did earlier the that's market, pretty it And the saw year, -- a fairly bit little generally tends Gulf But a be where in have saw going South earlier kind see prices -- think between those that in to Southeast remain out it to year, we was little our coastal more really bit decline earlier difference compared of We back from was flattened region. to region more quarter-over-quarter. to of tensioned year a our with the we I or that, a consistent -- since consistent. and market. in

been Okay. now. over Products. Lumber just maybe And shifting $XXX Wood month then for to has a under

capacity these maybe maybe Just seeing response you're And in? dealer regions that could levels, competitors at from wondering restock if in that maybe to any talk you operate prices? you about inventory willingness

I'll Anthony, take that is one. Yes, This Eric.

describe at the continue I inventories would to really they I way think that is levels. be low

when this up interest rates I seen shot way the month past over think they that dealers environment shoot X. nervous in or are up very you've have the

East up. war a and flare to you in see You how Middle see continue linger Ukraine this

want nervous inventory. are think about have to people levels I just don't macroeconomic high And environment. of this really consequently, they

So I low think inventory levels. levels are relatively

out the which response. to like your and permanent question, There's come X.X is capacity curtailments. the year earlier billion We are feet that another market of closures Now X.X then board were seeing were second temporary early answer a this capacity billion year. maybe we this probably saw that

a U.S. you of I think estimating a a And losing the of slow that money starting there at given building. announcements get duty And the pay have we're lot there's lumber these is noted. mills price the pressure market. to now any they the are are mills wasn't markets XXX, to pundits to underwater. B.C. recovered I'm people And summer. as I especially have the seen but through in or think we're their pause lumber guessing levels, below are -- of as back into lot forecasting B.C. enter late the not most season.

So we'll out. how see it plays

Markets. from BMO comes question Capital next of Ketan Your the Mamtora of line

terms along inventories see have terms of that And are Seaboard. level we where imports in seeing what first Maybe prices sitting coming segueing there of just in months given last the European lumber question, you the the do out Eastern Eric, in in still the a you of sense inventory. terms off the are are. of question might lumber

very little at closely, I were under I Ketan, -- is at you European early a this like. insight don't are through we I last year, QX because QX when data European And look XX%. saw is think January. look in And comparing always look I have it Yes, a are inventories surge lumber year what now year imports this But so do those down stale. X% pressure year into down direct this imports bit back XX%. prices we of fact, what import enormous year-to-date down can But versus August, QX tell year, if in are this imports of to I QX imports that the

I think these European at clear it's to pretty set that decline. So are prices, imports

flowing Europe. the versus 'XX year Russian, we'll even feet board fewer imports would X.X as idea guessing see then they're full down and Ukrainian that 'XX less I'm expect billion restrictions XXXX. wood whole year that of into the that Belorussian, X year of of kind I XX% Europe's next full exports That by from -- those those of was countries roughly to was, the went into really back out lumber coming those And Europe, in place countries. supply way, X of half

I get year. so into And think U.S. going continue be there's to into we because to to production Europe as fewer more the European imports within going stay next is

is imports for the the think outlook downside. I So European on

Got And it. still ways you just ports? to Do we at the there? have That's through worked the inventory helpful. sitting we one think go Or was more Eric, that there that. some on

-- again, imports, was the the direct insight, and have we wildfires worked I competition would summer but hit I really Canadian those their past when SPF don't way prices think think Ketan, I inventories, this I through Yes. Canada those European spiked primary SPF. have

me think Canadian to have not I it's I that down, right, some think is imports trying kind dots Again, cause that -- here. been connect of with pulled we're lumber. and would compete plentiful to just don't feel those to

it. your relatively guys to of side. that's to yet weakness Can you are southern to are heard talk what reported wood of some on can look you baskets, And trends the talk about you kind we've as then of kind as your No, you being seeing I at And quarters. just packaging out the been obviously, drops But point you pretty of pulpwood what there. in kind look at that's And data helpful. Got of recent switching stable sharp when kind prices well, timberlands. seeing?

Yes. this think -- Ketan, I Wayne. is

think the mills downtime just softness where or We've certainly I between pulp and a trending are. on On some taking the they with the certainly markets at pulpwood, seen economic pulpwood little and paper side, sawlog of that's quotas that trend still the is, think market. -- said the find that demand. we're having to kind tons able move but I that is we're softness But and still seeing -- more having in that,

on side, probably expecting the pulpwood We're pricing.

outlook is that hardwood. little Our us. of flat is mix, slightly is to a down part that But for bit of maybe

we typically have seasonally, the So in QX. in more mix hardwood versus QX

-- So on think you that I side say keeping prices a what in QX, slight slightly saw but more we flat. are mix and just little very we're fairly holding. just pricing from in optimistic see we the think year. pulp And impact But may I the probably really still is a earlier would

of the comes Your Securities. next Mike Roxland question Truist line with from

Jerry, on just one quick question for prices. you lumber

I when correctly have heard mentioned, confidence You your you prices that believe, metrics bottoming you I lumber that follow prices any that may got at that Are here. particular said and you look you you confidence you lumber that give there that be dropped.

losing all Yes. look the that pieces at. Eric, my any don't think like metric this there's I supply in the factor. And together. if Mike. But that is puzzle I'm to know and a who -- likely B.C. will I I of mosaic, knows of X them we response, in to It's is decide. to There's lot put mills that's be there's to one up mind, that a trying happen. a money. This are

$X.X drop. factor which you a uses That's bit the than more towards over is, This XXXX. multifamily. of we're starts. not as XXX,XXX mix market here $X.X which, million another know, seeing collapsed. And precipitous family, gone lot down from a not think in completely housing million I single single-family has shift also We've a a not is is lumber of to late,

COVID, collapse I in lots going think lots was COVID, by were When stuff, we back play to everybody are enormous an back that's out. buying the of in of about and go also to swing But look there's of equity. they've either. are that. house to think think don't way. going their at I after I boxes And And a markets R&R stuff itself people now starting now services. and been home say to amount So got

just R&R -- They home there. inventory existing that home an market sheets. out there. in with more is buy a going I the I there's natural the good labor new on there go But It They side. to these not because got just be so because prospects. are be it's very balance or think can't much fine. there's rates. It Pro got hanging very think may good may side R&R markets higher They little DIY on hang interest

there's X up look many, We okay balance, different back that factors. won't not It year many is be look at. getting an metric I this in any So year. think shaping question, it to great, your at will And next be than better be year. but I to

Got the it's of the obviously apologies been earnings referencing for -- name, it's And already. incorrect one hell it. season

you're appreciate worries, how take-up So No follow-up the quick the for mentioning there. from I apologize I on And on there's then just is color. builders. one but Chenal, incorrect also name question been the smaller and

that it due little of be could XQ, the maybe Is or quarters? X whether now take-up be just bit X And reversing the XQ, environment, would you do that quarter? reverse? slower this housing could a what's sight but so And next Obviously, in line business? in early year? it it something to have XQ see is a of you smaller right Or but --

Wayne. where go take-up we lots. through release this is would We to A start we've round a this Look, had of Mike, good year. process the thus of things say. far couple I next Yes,

in so lot of we're a releases. the softness seeing bit new And little

does what mind, Keep We're talking that not national Now large mean? regional these builders. are in builders.

the to sheets, national they same have don't multiple builder, have have of to type buyers. incentives a compared prospective home So available to definitely they tools don't the they provide -- balance

early innings softness. XX to think bit into we're is little So of these kind only seeing we're as we but houses, in seeing, what of building instead perhaps on we're look do just they're are But going X. a builders X this of or -- these the I QX, regional

America. line Your next Bank Staphos of with the comes of from George question

question. Mike's just I earlier Eric, you're to wanted back come on to saying what

are be no So market up? but paraphrasing And I'm construction year? to home a up looking XX%, next going you are is your that specifically, center if single-family then takeaway towards in And doubt mentioned into be expecting remarks tempered to it's housing you 'XX, you better correctly.

in, you us 'XX? So think what whatever you as it remodel for relates dial and versus about ultimately for to metaphor the to do 'XX repair want

different X there's to your parts So George. question,

say one, is be a had single-family. first the year And but -- of this little look month-over-month, we're to to If a So bit okay, going not guess market, up next single-family I'd signs data think to little. I now, see year. right the housing we're new I a Not versus actually you lot, said, starts, latest if the XX% collapsed. was home The I has were X% like you up step back month-over-month. at sales and starting up

I middle cutting to of to rates. get And Fed going to the think and most going We're start -- it's is next year. pivot believe people the

labor incredibly an tight got market. still You

got few a I are going still underbuilt think homes sale. those You've an away. for factors don't existing

So to the as I I over skew a a and a do of expect expect starts couple got action over has to lot to little single-family there years. be last multifamily next up be year, of bit

So and remodel. switching gears repair and talking about

So home I we track a talk dealer about by talk it lose is the market I remodel general. and sell can market. we about simply kind percent in our large, I specifically shipments go of which talk what into repair cannot R&R because about distributor, demand, of our when going shipments, it. segment center the can to into and of our

is seen for decline. forecasts R&R bed. that the out X% or is of reasonably fall I've to happen X% going an some of stay to there strong. going is out think not that It's to going call, I what So

lot their is trend, X%. there's their that's it's strong I are think now, from goods, think or No, they services the reasons year stay I to want RISI asset as not that's to to FEA. next The to But back house. home just work away I go that that's it, own would housing you or want put their slightly even different R&R -- intuitively, work, going of Harvard start probably is back to to that favorite away money whatever got going has right from remote people number. into LIRA up a argue call what going says up That's a going invest study. pivot the house. in people

And I of see R&R don't out so bed. falling

Understood. talk the relative bit for that. to in the color it little to be manufacturing Appreciate what a what progress quarter? we third expect Should Products you to a for continue And then you've in on year? as it, can fourth maybe quarter us you and this bit been seeing saw you Wood getting the mentioned costs better

compared little on a Well, be thousand costs down the bit be And They progress costs, I year-over-year basis third having quarter. third just to will to quarter rate quarter we think cash environment, cash this have our expect lower to just the in going been lower this be win. a year. in that flat I would quarter. you fourth a bit But in total the they're a is per but I tell fourth cost be seeing to compared the inflationary

year quick lot is actually, case. follow-on one question, isn't let's this And Hopefully, this. turn And But say next housing slower last I'll the a over. I'll a it ask to is front-loaded and expected. bring lot against as you to opportunity way Do than more that? a would quickly you the have have up a demand what of and managing slower Waldo

then of do in are operating reason. you whatever little say say, of bit. What stance, you up do manage what year you How let's million starts, would for a boomer And let's $X.X kind It's differently? differently, that your environment? say, do a instead do

Yes.

news. and project up is think a is running last we faster? We bring great complex Waldo so just Gantt Group I are very ahead they charts can George, of This with involved. met schedule, enormous So with week BID which the

a up the beat be don't to mid about schedule. next to it's expect we that. year, So and to which ramp for manner, possible the finish us after production by we then in going timely is as project spoke I think

We're or out up enormous streams the pieces part putting we or sawmill making kilns a there now, with great There's the just mill. do project we're and concrete pouring of not work a of process right I faster. the but it's progress, that we're into lot on. the each think Whether ramp equipment plan can involved going -- different processing that

would second it's differently? many sawmills, a there for year, so your what ground. on boom to you breaking the think part possibly do into is could we point the your people, then need your our breaking hours point we we -- question, And is as as equipment of do there maintenance, run and for at if would Well, put I a you preventative a

every I out think we to environment. would last can in the an possibly So lumber what of piece we kind mill just get do try that that is of

with comes next Yinger question the line Your D.A. Davidson. of from Kurt

been wanted start a North in one bit least on factor here in The just contractor kind a off cost I the Just couple ago, I this than was to cost quarters if higher that have curious know noteworthy else front at expected. that anything off. of might challenge quarter was hit structure timberland. the were a there's or but had of availability we QX on

this is Yes, Kurt, Wayne.

to side, factors. steeper and north in quarter cost the we're terrain. on I the by and from standpoint, haul further back that's country, One, logging generally driven log we're seasonally, that speaking, be higher our the X tends in think a really in

on based that a results cost. higher So logging in that,

have your fuel prices. to higher quarter slightly when longer then factor you we the then would I is so costs then back, also you're increases other last also distances, say diesel compared And further haul had but that haul

So an in to we compared uptick saw QX. QX

was we this quarter. experienced a component that that So also

Got it.

have generation built how you then very you I record the And front, look capital you on sheet balance the guys a think track capacity do kind think lumber mean, nimble of and there. light Eric, about current repurchases you've of the to in I aggressive the this guess be I touched cash allocation terrific the share of you on current in at been and market, Okay. kind how if of when past, discount more kind persists? with

Yes.

a to Kurt. That because we our point, reason, $XXX million thought it's We've and on of existing a good $XXX we at to got bit outstanding million We had the have $XXX So go number level. for was authorization. fair capacity still million capacity. that set

probably more do of have thinking is capital. the some than influences use ongoing that M&A we that what What anything may you tell would activity. up other I projects

have with we Now paying for to certainly, which -- Waldo expansion, done project yet. going that is not our we're

work We're question, in capacity still but back your to off do very what some remarks, have fast yes, careful, markets get to you going this to knows? which uncertain drop we're East. see I territories Middle cash going balance on Israel cautious. going that's more bomb of environment. can who the nuclear in the reiterate in don't stuff, know, dislocate So in be to is, I I'll But prepared really to happen kind said an off here. we What's really to Iran, sheet. But a my very

are we'll and what buy and to room certainly, So And we'll back careful be the have we when think do we more. NAV. discounts slow patient deep to

next of question Your comes from Mark Seaport line Weintraub Partners. with the Research

talked And Eric, about you either we to also steep certainly and metrics activity. referenced that at discount use stock then also certainly to using use. to It you a considering way. but M&A share capital NAV, of going trading repurchase, looks tend all

are and seeing So sort together. if putting those then you pricing? timber the let's what I'll have there there in maybe start One, markets and out timberland -- two And relatedly, a follow-up. of sort with of things

Yes.

want the timberland we quiet do still going value or that to M&A interest find of are are we're off lumber now. factors above timberland to there. if our capital it become but M&A, given for capital. our their improve probably prices our or . And to deals rates come and has cost suspect create are it think to going it very We a perhaps hard IRRs right market, down waiting that mainstream buying value. with footprint a is basically sort deals of fast up, of shareholder-friendly to timber how relatively us sellers carbon a in hard we of cost more that creating We for through to grow way, with host holding do is only So it's can run properties,

not to that So being our Loutre. beaten that can is opportunities are opportunity, did are we've path, We shown and that that broadly auctioned off Mark, we do find with the that.

a ago. recall, you we of that did couple years If

might like right at that so we things now. looking And be

prices, that's way they're my you to auction, go -- because can the in in they only this create environment value timberland high. So that's broad mind, sky

Right.

just following And on that. up kind so just of

buy capital that Or even acquire more acquisition stock, it, make is fact to at decision the are look to that forward? difficult. seem just to therefore, your than trading much you do better go you of the your discount large than greenlight So and back very timberlands cost the given at that a rather NAV, would

and sense the just So there does not Or And maybe potentially on kind a philosophy mean, would I then are spreads? opportunities make be, factors? to timberlands of conversely different sell arbitrage number that? that value second your for of

the back look doubt than pendulum doubt has market we've timberland buying in has here stock. look this back timberland, us how back here market of buying we've year. stock. at the there's buying Mark, attractive how terms In become Yes, the There's been active more no no the towards buying been at quiet stock and to buying in swung

timberland we do grow our want to said, that footprint. Now

I timberland think the is outlook for values fantastic.

And looking be now, trying they've And winning to But portfolio. out. so repurchases. our with share now, right. always compete going right it's you're Right to to add repurchases, share timberland been at to got we're

consider we think to second your trying all buy Now a fund the a to selling would timberland company cash shareholder I table. maximize as raise on back, are public value, to options question,

very discussions premiums. assets opportunistically of that engage we time those think in As types time. sometimes do are what attractive portfolio from managers, at we selling And means to

if to how a price attractive repurchases. see out. yes, really play But fund things would even look core selling at it was in timberland more So we'll we fact, at timberland,

So we'll see.

development there's And to lands, that do leakage just true there's is -- no and -- et say activity if that? there no cetera, the on if you tax it

question again? Can that ask you

-- wouldn't you it tax big one is there against as of is REITs timber no the bills for often selling activity true those of if there's If well? on that when leakage there the or companies development that nature Obviously, selling core be? in issues been timberlands, no assets tax big is that lands, of there's case anything sale. But

No. I be sales would income. REIT REIT these mean of type that's

So yes, tax any arbitrage. there isn't

next the Quinn line Markets. comes of Capital question of from Your Instructions] Paul [Operator RBC

in It your South. got that time you're opportunities. What the Just else first making the decent Natural one, the sounds like the progress line Solutions have in what's you Climate And hopper? of on XX,XXX on acres those?

Well, Paul. on the carbon me, Or are credit NCS opportunities? talking broader Mark, front, about you specifically, excuse

Yes, it on credit, the just yes, is, carbon Paul. and

Yes.

a So acres out progress into on transaction. to our to deal, got we're we a carbon play. the those, making are from learning good it's first we're lot one that and -- But comes more looking we We've on going really going that relatively XX,XXX execute we're before that sizable put transaction, we a at potentially acres. first because are we see might how

And on to, I Wood moving guess, just Okay. then Products.

duties softwood looking forward? right getting amount And on take down be that of and solution going just Do -- what's Just X% what's to in is rate sort a same thoughts that the at seem softwood that you in file the stay it like going mark, now, and to of path your on to lumber flows Canada What duty sort you changing do that lumber. see solution? to the looks your 'XX. of wood the U.S. don't from the

Yes.

the an at discussions it's taking to conversations this take going what get know agreement. have even to to are incredibly any I point. been know I think I place quiet. don't don't that there

lumber to willing anytime don't many, But prices of halt. has see chatter a an years, thing to prices up, end then I lumber are a some to solution. to drop, I conversations come seem back those and This come been for many I ongoing to to soon. it find as to when the think Canadian that I engage start try hear think producers

just made strength you but for just 'XX level, and moving your mean, come sales, year? you've with out on guidance estate, be on expectation high haven't 'XX single-family and to wondering Okay. down I just up or the just comments for should real in yet, a the And just on or lot then at know that flat about next your Chenal market what Valley I

I Yes, early. still -- bit QX here, Yes, out we're We'll a next it's put is year. this Paul, think Wayne. our 'XX outlook little

in said we like seeing but market our innings -- earlier, on the it's the rates. pretty what and think I of early take-up we're

So over 'XX more couple better get pretty sense a there will still And -- is of months. think there's think next of out. we'll good take we into have still insight But the where come up. that we

maybe a homes these X earlier, do said regional year, or I Like they instead of doing builders XX X.

prices. a just say those our -- X% good It's to there. slight little also power, not have off. would we've from it's think a that it's And and year, a to slight pricing -- pricing or still going So moving reduction a prices maybe since drop lot last and softness we're we we don't just XX% increased at holding I those standpoint,

we'll what So we of solid they to It's next is just the And the what regional over continue much months. do happens take to on. see pricing. see couple builders, how want

BMO comes -- Capital Mamtora Ketan Your of line Markets. from is follow-up next question the of question from a

This we normalized Just how a -- but coming on about back basis? land the sort done What's question, ongoing stratification not CatchMark to with number now? on should question rural the asking. an is this think sales right the real was the just lands, Paul XXXX estate that of

Yes. and I that's of of target -- mean looked we've X% over kind we so real and a vary XX,XXX be below selling look so kind that at that really end around estate you're tracks the of and around conservation that can the use it from the from But yes, to standpoint, standpoint an the at slightly rural threshold. time, acreage can portfolio. sales size Pricing, it's X% of acres, on our very of This we quarter-to-quarter, kind target estate from we're the side. year, year-to-year. period-to-period lumpy recreational depends on real

of portfolio. outlook, we the when we're an that's that looking yes, look at think, kind I So X% at

there this call Wayne Wasechek. showing I'm to At turn the back further over are questions. no time, I'll now

in Thanks interest your That PotlatchDeltic. questions our and call. for concludes your

concludes This you conference Thank for call. today's joining.

lines. your disconnect now may You