Deltic Timber 4Q Net Income Up 52 Percent

Ray Dillon

Deltic Timber Corp. of El Dorado on Wednesday reported fourth-quarter net income of $3.5 million, up 52 percent from the same quarter last year amid increases in residential lot sales.

The timber and real estate company, which owns residential land in Little Rock’s Chenal Valley, also reported its second-best year of annual net income since it became a publicly traded firm in 1997.

Deltic said net income for fiscal 2014 was $19.7 million, down 3 percent from $20.3 million in fiscal 2013. 

Fiscal 2013 remains the company’s best year for net income. But that figure doesn’t include non-recurring gains the company realized after it purchased the remaining half of Del-Tin Fiber. Including those gains and other one-time items, the company took in $26.2 million in fiscal 2013.

“Deltic’s vertically integrated operating assets produced solid financial results for the year of 2014, as the Company’s performance essentially matched the record level of income reported for 2013,” Deltic CEO Ray Dillon said in a news release. 

“In addition, fourth-quarter earnings were favorable to the same quarter a year ago, as we closed on the sale of 53 residential lots during the current-year quarter, evidence of continued demand for lots in our real estate developments,” he said. “During the year, our Real Estate segment also achieved the first sale of commercial real estate acreage since 2011.”

For the year, the company said:

• Pine sawtimber harvest was 622,607 tons compared to 605,361 tons harvested in 2013, while the average sales price increased 9 percent to $24 per ton. 
• Pine pulpwood harvest volume was 391,434 tons in 2014 compared to 340,083 tons in 2013, with no change in the average sales price, at $8 per ton. 
• Sales of non-strategic timberland totaled 472 acres with an average sales price of $2,300 per acre, while in 2013, the company sold 1,677 acres with a per-acre sales price of $1,500. 
• Oil and gas lease rental and net royalty income totaled $5.9 million in 2014 versus $5.1 million in 2013. 
• Average lumber sales price was $383 per thousand board feet compared to $384 per thousand board feet in 2013. 
• Lumber sales volume increased 7.4 million board feet, from 261.1 million board feet in 2013 to 268.5 million board feet in 2014, as Deltic adjusted sawmill operating hours to meet the market demand for lumber. 
• The average sales price for medium-density fiberboard (MDF) was $578 per thousand square feet in 2013 compared to $581 per thousand square feet in 2014. 
• MDF sales volume increased 4.2 million SF, or 4 percent, from 107.7 million SF in 2013 to 111.9 million SFin 2014, as Del-Tin Fiber balanced production with demand. 
• Residential lot sales totaled 98 lots at an average sales price of $84,200 per lot compared to 65 lots at $76,000 per lot for 2013. 
• The company sold 1.72 acres of commercial real estate for $500,900 per acre, while there were no commercial acreage sales in 2013.

Looking to 2015, the company expects residential lot sales of 75 to 100. Dillon said that while commerical acreage in Chenal Valley “contines to receive interest,” the “volatile nature of commercial real estate transactions and the significant number of factors involved, it is difficult to anticipate future closings.”