| U.S. Timberlands Company, L.P. | |||
| Proposed Ticker: | TIM | P.O. Box 10 6400 Highway 66 | |
| Exchange: | NASDAQ-National Market | Klamath Falls, OR 97601 | |
| Industry: | Agricultural (SIC Code 0811) | (541) 884-2240 | |
| # of Employees: | 30 | ||
| Type of Shares: | Limited Partnership Interests | Filing Date: | 8/4/97 | |
| U.S. Shares Filed: | 7,232,000 | Filing Range: | $19.00 - $21.00 | |
| Non-U.S. Shares Filed: | 0 | Offering Amount: | $144,640,000 | |
| Primary Shares: | 7,232,000 | Expenses: | - | |
| Secondary Shares: | 0 | Shares Out After: |
| Manager | Tier | Phone |
| Smith Barney Inc. | Lead Manager | (212) 723-7300 |
| A.G. Edwards & Sons, Inc. | Co-manager | (314) 955-3039 |
| Deutsche Morgan Grenfell | Co-manager | (212) 469-5600 |
| PaineWebber Incorporated | Co-manager | (212) 713-2626 |
| Prudential Securities Incorporated | Co-manager | (212) 778-5420 |
| Issuer's Law Firm: | Andrews & Kurth |
| Bank's Law Firm: | Baker & Botts |
| Auditor: | Arthur Andersen |
| Registrar/Transfer Agent: | American Stock Transfer & Trust Co |
Dollar amounts in U.S. millions except for per share data | |||||
| 3 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 3/31/97 | 3/31/96 | 3/31/97 | ||
| Revenue: | $29.60 | $8.83 | $4.03 | Assets: | $308.98 |
| Net Income: | -$23.37 | -$1.95 | $0.26 | Curr Assets: | $30.78 |
| EPS: | -$1.82 | Liabilities: | $315.05 | ||
| Prior EPS: | Curr Liabilities: | $10.05 | |||
| Cash Flow/Oper: | Equity: | -$6.07 | |||
| Cash Flow/Fin: | Cash: | $28.65 | |||
| Cash Flow/Inv: | Working Cap: | $20.73 | |||
| Business Description |
| The company's business consists of the growing of trees and the sale of logs and standing timber. The company owns approximately 643,000 fee acres of timberland and cutting rights in Oregon east of the Cascade range. The Company also owns and operates its own seed orchard and produces approximately 5 million genetically improved conifer seedlings annually from its nursery, about half of which are used for its own internal reforestation programs, with the balance sold to other forest products companies. The Timberlands include substantial holdings of merchantable, good quality timber. The Timberlands' merchantable timber consists of Ponderosa Pine (approximately 42%) and Douglas Fir (approximately 14%), species which have historically commanded premium prices over other softwood species, with the balance consisting of Lodgepole Pine, White Fir and other softwood species. The Timberlands have stands of varying ages and are unique in the forests east of the Cascade Range in Oregon in that approximately 184,000 acres are actively managed tree farms (the "Plantations"). The Plantations were first established by Weyerhaeuser Company ("Weyerhaeuser") in the early 1970s and acreage has been planted each year since then. |
| Competition |
| Due to transportation costs, domestic conversion facilities in the Pacific Northwest tend to purchase raw materials within relatively confined geographic areas, generally within a 200-mile radius. It is generally recognized that log suppliers such as the Company provide their market with a commodity product. The Company and its competitors all benefit from the same competitive advantages in the region--namely, excess of demand, close proximity to numerous mills, and positive demographic trends of the Pacific Northwest and the West Coast. Therefore, the Company and its competitors are currently able to sell all the logs they are able to produce. Additional competitive factors within a market area generally will include species and grade, quality, ability to supply logs which consistently meet the customers' specifications and ability to meet delivery requirements. The Company believes that it has a reputation as a stable and consistent supplier of well-merchandised, high-quality logs. The Company has no conversion facilities and therefore does not compete with its customers for logs. The Company believes that this gives it an advantage over certain of its competitors that also own conversion facilities. The Company competes with numerous private land and timber owners in the northwestern United States and the state agencies of Oregon, as well as immaterial amounts of foreign imports, primarily from Canada and New Zealand. In addition, the Company competes with the USFS, the BLM and the Bureau of Indian Affairs. Certain of the Company's competitors have significantly greater financial resources than the Company. |
| Business Plan |
| The company's business strategy is to manage its Timberlands in a manner that will enable it to pay the Minimum Quarterly Distribution on all the Units and to increase the per unit value of the company's assets and cash flow. Management intends to pursue this strategy in a number of ways: (I) Continue to Increase Productivity of the Timberlands, (ii) Maximize Investment in Ochoco Timberlands, (iii) Pursue Accretive Acquisition Opportunities, (iv) Implement Flexible Marketing Strategies and (v) Sell Land for Higher and Better Uses. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used for repayment of indebtedness. |
| Name of Shareholder | % Owned Before | % Owned After |
| John M. Rudey | 97.00% | 41.10% |
| U.S. Timberlands Holdings, L.L.C. | 73.40% | 31.10% |
| Rudey Timber Company, L.L.C. | 72.70% | 30.80% |
| U.S. Timberlands Management Company, L.L.C. | 23.60% | 10.00% |
| Officer Name | Title | Age |
| John M. Rudey | Chairman and Director | 54 |
| Edward J. Kobacker | Executive Vice President, Chief Operating Officer and Director | 59 |
| Christopher J. Sokol | Forestry Manager | 48 |
| Martin Lugus | General Manager | 56 |
| Walter L. Barnes | Harvesting Manager | 55 |
| Robert A. Broadhead | Marketing Manager | 46 |
| Kurt A. Muller | Planning Manager | 39 |
| John J. Stephens | President, Chief Executive Officer and Director | 69 |
| Michael J. Morgan | Vice President and Chief Financial Officer | 41 |