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PotlatchDeltic Corporation PCH is slated to report its fourth-quarter 2024 results on Jan. 27, after market close.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
In the last quarter, adjusted earnings and revenues topped the Zacks Consensus Estimate by 200% and 6.6%, respectively. However, on a year-over-year basis, both metrics declined 71.4% and 4.1%, respectively.
PCH’s earnings topped the consensus mark in two of the trailing four quarters, met on one occasion and missed on the remaining one occasion, with an average surprise of 50%.
Trends in PotlatchDeltic’s Estimate Revision
The Zacks Consensus Estimate for adjusted earnings per share has increased from a loss of 5 cents to a break-even point over the past 30 days. The current estimate is at par with the year-ago quarter’s figure.
Potlatch Corporation Price and EPS Surprise
Potlatch Corporation price-eps-surprise | Potlatch Corporation Quote
The consensus mark for revenues is pegged at $241.2 million, indicating 5.2% decline from the year-ago quarter.
Factors Likely to Define PCH’s Q4 Results
Revenues
PotlatchDeltic’s fourth-quarter top-line performance is likely to have declined year over year due to the seasonally slow trends witnessed in the last few months of the year, lower lumber prices and decreased Northern sawlog prices. Also, lower lumber shipments because of the planned downtime and restart at its Waldo, AR sawmill are expected to have added to the headwinds.
That said, increased rural acres and residential lots sold accompanied with a favorable average price per residential lot sold, given the improving housing market and a declining interest rate scenario, is likely to have negated the impacts of the headwinds to some extent.
The Zacks Consensus Estimate for revenues of the Timberlands and Wood Products segments is pegged at $98 million and $154 million, up year over year from $97 million and $150 million, respectively. On the other hand, revenues for the Real Estate segment are expected to be $20 million, down year over year from $27.91 million. The decline in contributions from the Real Estate segment is expected to have overshadowed the marginal growth across the other two segments during the quarter.
Margins
The bottom-line performance of PCH is expected to have been hindered due to the persisting inflationary environment and increased cost and expense structure. The selling, general and administrative expenses are expected to have moved up due to increases in professional service fees, including costs for the implementation of new systems and employee-related costs. Furthermore, increased rural real estate acres and residential lots sold, along with increased log and haul costs associated with higher harvest activity, are likely to have added to the cost increase.
Nonetheless, lower raw material, production and shipping costs primarily at the Waldo, AR sawmill, along with PotlatchDeltic’s ongoing efforts to gain operational excellence and expand margins, are likely to have partially offset the adverse impact on the margins during the quarter.