Potlatch Earnings: Here’s Why Investors are Happy Now

Potlatch Corporation (NYSE:PCH) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are up 3.71%.

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Potlatch Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 192.31% to $0.38 in the quarter versus EPS of $0.13 in the year-earlier quarter.

Revenue: Rose 23.95% to $139.3 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Potlatch Corporation reported adjusted EPS income of $0.38 per share. By that measure, the company beat the mean analyst estimate of $0.26. It beat the average revenue estimate of $134.69 million.

Quoting Management: “We are off to a very strong start in 2013 as first quarter results exceeded our expectations,” said Michael Covey, chairman and chief executive officer of Potlatch Corporation. “The strength in our Wood Products operations in 2012 carried over into 2013, as lumber prices continued to strengthen in the first quarter despite lower demand due to poor winter weather in much of the country. Last year we began to see the improvement in lumber prices begin to be reflected in higher log prices, and that trend continues today, particularly in the northern region of our Resource business. Because of the strength in sawlog prices in Idaho, we pulled forward a portion of our planned harvest from the second half of the year into the first quarter to take advantage of this pricing opportunity. In addition, the two land acquisitions we made in Arkansas in late 2012 increased our harvest levels slightly in our Southern region in the first quarter. Although sawlog prices in the South remained depressed in the first quarter, we are optimistic that pricing will improve. In our Real Estate segment, we are seeing increased demand for our rural and HBU real estate properties, which is leading to firmer pricing,” concluded Mr. Covey.

Key Stats (on next page)…

Revenue decreased 2.79% from $143.3 million in the previous quarter. EPS increased 11.76% from $0.34 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.29 to a profit $0.22. For the current year, the average estimate has moved down from a profit of $1.35 to a profit of $1.32 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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