FRA has welcomed the news that Plum Creek Timber Co has seen its profits soar off the back of growing demand for lumber in the US and abroad.
November 22, 2012 (Newswire) - Forestry Research Associates (FRA) has welcomed the news that Plum Creek Timber Co has seen its profits soar off the back of growing demand for lumber in the US and abroad.
Third quarter earnings increased by a healthy 18 per cent, while earnings per share are thought to have totaled between 25 and 30 cents - rising as high as 36 cents, according to Thomson Reuters analysts.
FRA's analysis partner, Peter Collins, said, "The news that Plumb Creek are doing well is good news for forestry firms globally, in my opinion. Plum Creek are the largest forestry owners in the US and if they are enjoying increased demand, so are others." The business owns some 6.6 million acres of forested land in the US.
In total, the quarter to September 2012 resulted in profits of $59 million, up from $50 million during the same quarter a year before. Revenues also grew, by 21 per cent to $354 million.
Plum Creek's CEO, Rick Holley, explained, "Demand for wood products continues to improve and that has translated into improved financial performance for our timber and manufacturing businesses."
The growth in demand is coming partly as a result of the new health within the housing sector and partly from continued demand in developing economies, such as China and India.
"Investing in timber is a great option for anyone looking for an ethical alternative at the moment," claimed Mr Collins. FRA, a research and analysis consultancy, advocates investment in sustainable forestry projects such as those run by firms like Greenwood Management. "We believe that it is a great time to be investing in timber and timberland. The demand for timber to build homes in the US, Brazil, China and India is growing all the time and it looks like the supply will barely be able to keep up with demand," added Mr Collins.