Weyerhaeuser divide its dividend by more than half and said fourth-quarter earnings will be “significantly” lower than the company expected.
The dividend was reduced 58 percent to 25 cents a share from 60 cents, the Federal Way-based sawed producer said Friday. The company expects “challenging” market conditions to continue end next year.
Chief Executive Officer Daniel Fulton has sold businesses, fired workers and close up trash mills to contend with slowing U.S. housing construction, which has cut ask for for building materials. The pace of single-family-home starts slumped 46 percent in November from a year earlier.
“These are the overcome markets I’ve seen during my career,” Fulton declared Friday on a conference call by analysts. “We expect the difficult conditions to continue through 2009, and the timing and strength of the recovery are uncertain.”
Revenue at Weyerhaeuser, which has investments in residential real-estate development, timberland management and wood-pulp production, fell 25 percent to $2.17 billion in the third part quarter. The decline partly reflected the $6 billion market of Weyerhaeuser’s industrial-packaging business to International Paper in August.
Analysts expected the gang to postman a fourth-quarter loss of 31 cents a contingent, excluding some items, according to the average of 16 estimates in a Bloomberg mensuration. Weyerhaeuser had a 51-cent make improvement a year earlier.
Friday’s news pushed Weyerhaeuser stock down $3.54, or 9.5 percent, to $33.59; the shares have declined 54 percent this year.
Charges attributable to home-purchase cancellations, lower prices for homes and land and other losses in Weyerhaeuser’s real-estate-development division may rise to $650 million in the fourth quarter, Chief Financial Officer Patricia Bedient said on the call.
The company plans to use up $200 million to $250 million on capital projects in 2009, on the ground from $425 million this year. Weyerhaeuser also said it may repurchase as abundant as $250 million of its due shares.
On Nov. 6, Weyerhaeuser announced it would indefinitely close the door upon an engineered-wood facility in Colbert, Ga., affecting about 105 employees.
Weyerhaeuser attributed the closing to decreased interrogation because of the U.S. housing slowdown.
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