Deltic Timber 1Q Net Income Flat But Lot Sales Improve

Deltic Timber Corp. of El Dorado on Monday reported first-quarter net income of $100,000, the same as it reported during the same time last year, amid what its CEO called "a weak housing marketing."

The timber and real estate company cited improvement in its mills operation and higher sales prices, but added that any gains were offset by increased corporate expenses and lower equity in earnings of its Del-Tin Fiber.

Del-Tin Fiber is a joint venture to make medium density fiberboard.

"I am pleased to report that Deltic’s solid assets generated profitable results despite the continued negative impact on our businesses caused by the weak housing market," Deltic CEO Ray Dillon said in a news release.

"Having our Mills segment produce increased operating income in this lumber market was quite an accomplishment, and reinforces our vertical-integration strategy. In addition, dry weather conditions in our operating area resulted in excellent logging conditions in our timberlands, on which we capitalized by increasing our harvest levels when compared to the first quarter of 2011."

Dillon also said the company is seeing "a slight increase" in residential lot sales in its Chenal Valley development in west Little Rock. He attributed the activity to low interest rates and improved credit availability from banks.

Still, the company’s real estate segment reported an operating loss of $800,000 for the first quarters of 2012 and 2011. It said it sold seven lots in 2012, better than the three it sold during the same quarter in 2011.

Average per-lot sales price was $67,100, an $18,200 per lot decrease from the first quarter of 2011’s average per-lot sales price of $85,300. Deltic attributed the drop to the mix of lots sold.

The company said there were no sales of commercial real estate in the first quarter of 2012 or 2011.

Looking to the second quarter, Dillon said the company expects residential lot sales at five to ten lots. For the full year, it expects to sell between 25 and 35 lots.