Good morning. Welcome to the CatchMark Timber Trust Fourth Quarter and Full Year 2020 Earnings Call and Webcast. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Ursula Godoy, Chief Financial Officer of CatchMark. Please go ahead..

Good morning. And thank you for joining us for our review of CatchMark Timber Trust results for fourth quarter and full year 2020. I am Ursula Godoy, Chief Financial Officer of CatchMark. Joining me today on the call are, Chief Executive Officer, Brian Davis; Chief Resources Officer, Todd Reitz; and John Rasor, President of Triple T Timberlands.

During this call, CatchMark's management will make forward-looking statements. These forward-looking statements are based on management's current beliefs and the information currently available.

CatchMark's actual results will be affected by certain risks and uncertainties that are beyond its control or ability to predict and could cause our actual results to differ materially from expectations.

For more information about the factors that could cause such differences, we refer you to our 2019 annual report on Form 10-K, or quarterly report on Form 10-Q for the first quarter of 2020, and subsequent reports that we filed with the SEC. Today's presentation includes certain non-GAAP financial measures.

Reconciliations of these measurements are included in our fourth quarter 2020 earnings release and financial supplement, both of which are posted on our website. After our presentation, Brian Todd, John, and I will be pleased to answer any of your questions. Now, I turn over the call to Chief Executive Officer, Brian Davis..

Thanks, Ursula. And thank you all for joining us on the call today. All of us at CatchMark hope you your colleagues, families and friends are staying healthy and safe. I extend particular appreciation and thanks to our employees for their ongoing dedication, resilience and performance.

COVID created turbulence and dislocation across the economy last year, especially at the start of the pandemic. Weather from hurricanes and Pacific Northwest wildfires also presented challenges during 2020. But at CatchMark, these challenges serve to further prove the strength of our business model which is based on three key elements.

Investing in prime timberlands with industry-leading productivity, focusing on investments in top middle markets, where we have strong counterparty relationships, and executing superior management focusing on delivered wood sales, as well as opportunistic stumpage sales.

As a result, our nimbleness and flexibility allowed us to meet customer demand, and we continue to generate predictable and stable cash flow, which resulted in fully covered dividends. We ended the year with very strong results, delivering an excellent fourth quarter which exceeded prior year and lifted full year results above our company guidance.

Throughout 2020, our core operations generated premium timber sale prices substantially above market averages. We realized higher year-over-year annual harvest volumes, which were consistent and with historical productivity levels, and we completed opportunistic timberland sales capturing higher margins.

During the year, we also preserved healthy liquidity, stable leverage and advantageous management of debt capital. The large disposition of the Georgia timberlands in the first quarter continued our strategic deleveraging by recycling $21.3 million, realizing a $1.3 million gain on that transaction.

Meanwhile, we enhanced our overall portfolio average stocking in core operating areas. In the second quarter, we made significant progress in furthering our long term strategic objectives, specifically with a Triple T joint venture.

We successfully renegotiated Georgia-Pacific wood supply agreement, allowing market-based pricing and sales to third parties, among other benefits to Triple T, helped propel a very strong year of operations under the leadership of John Rasor.

Not only did the Georgia-Pacific agreement set the stage for the improved joint venture performance, but has also enhanced a long-term asset value. In the wake of the GP agreement, we continue to evaluate recapitalization alternatives for the joint venture, and expect to make significant progress during the year ahead.

This world-class asset boasting strong counterparties, and now, market-based pricing for all timber sales, should attract interest in a relatively quiet timberland marketplace.

2020 also showed promise for our long-term strategy of concentrating our prime timberland assets and premier US South mill markets, where we have strong counterparty relationships. Since our IPO, we have been consistent in our view of macro factors that will positively impact the timber industry in the region.

This has played out as we have anticipated; evidenced by a shift in production precipitated by the pine beetle in British Columbia, and the relocation of no capacity to the US South to meet North American wood product demand.

Over the past decade, the devastating mountain pine beetle infestation reduced cost competitive logs for sawmills in British Columbia. As a result, we expected mill operators to move production eventually into the US south. To take advantage, CatchMark strategy has been to select prime timberlands and premier US South mill markets.

Our investments have successfully increased our feet timberland [ph] ownership by 56% and generated a compound annual growth rate for adjusted EBITDA of 47% since the IPO.

In the meantime, mill closures in British Columbia began two years ago, and they anticipate expansion of mill capacity to the US South has been well underway over the past several years. In fact, capital investments and wood-using assets since 2016 has totaled over $20 billion, with over 80% of that capital invested in the US South.

Specifically, sawmill capacity in the US South has experienced a sharp increase of more than 20% since 2018, with new capital projects in Greenfield mills continued to be announced, to meet growing demand for wood-based building products. The next stage of our opportunity lies in a sustained and durable housing recovery.

A resilient housing market will help drive consumption of wood products, reduce the log supply overhang in the US South and create price tension for all regional timberland owners. We were on the cusp of that increased demand when COVID hit a year ago.

Although the pandemic created a momentary pause, the combination of demographic trends, growing household formations, aging in place baby boomers [ph], and aging household stock, bodes well for the forest products industry. And that is playing out now in the current upsurge in housing demand.

As a preferred and reliable supplier to our customer base, with a differentiated operating model, we believe CatchMark is poised to participate in anticipated lock price improvements in our markets. All the elements now are falling into place to propel our value proposition.

Our relatively simple and straightforward business strategy designed around providing predictable and stable cash flow to our shareholders continues to be well-executed. It provided the framework for generating strong 2020 results and should provide CatchMark with an operating tail winds in the year ahead.

Most importantly, we continued to deliver reliable fully covered quarterly dividends. And yesterday, we declared first quarter 2021 dividend of $0.135 per share for stockholders of record on February 26, payable on March 15. Now, Ursula would detail fourth quarter and full year results..

Thank you, Brian. In analyzing our fourth quarter, we exceeded plan realizing timber prices higher than market averages, securing higher year-over-year pricing in the Pacific-Northwest, and as we had anticipated, executing on timberland sales delayed earlier in the year by COVID constraints.

We also capitalized on land sale opportunities that arose late in the fourth quarter.

Specifically, total revenues, net loss reductions and adjusted EBITDA register above planned and prior year, as net timber sales, timberland sales and asset management fee revenue increase and losses from the unconsolidated Triple T joint venture decrease significantly.

For the quarter ended December 31, 2020, CatchMark generated revenues of $30.9 million compared to $29.1 million in fourth quarter of 2019. Timber sales revenue totaled $19.9 million, comparable to fourth quarter 2019.

As expected, total harvest volume decreased year-over-year by 8% to 578,000 tons, as quarterly harvest volumes were more evenly distributed in 2020 compared to 2019, when harvest were weighted more heavily to the second half of the year.

Net loss significantly improved from $11.8 million in fourth quarter 2019, to $3 million in fourth quarter 2020, primarily due to an $8.7 million decrease in losses allocated from the Triple T joint venture. We generated adjusted EBITDA of $17.3 million, compared to $15.1 million in fourth quarter of 2019.

It's a 15% gain, primarily driven by increased harvest volumes and higher pricing in the Pacific-Northwest and increased timberland sales. We also continued to capture higher than average market pricing for timber sales in the US south.

Breaking out adjusted EBITDA up by segments; for the fourth quarter, harvest EBITDA was $9.7 million equal to fourth quarter of 2019. Real estate EBITDA increased by 35% year-over-year to $6.4 million, due to selling 800 more acres at a 5% higher average per acre sales price.

The improved margins, 19% in fourth quarter 2020 versus 10% in fourth quarter 2019, resulted from selling trucks [ph] with a longer average hold period and lower average merchantable timber stocking.

Investment Management EBITDA of $3.2 million was comparable year-over-year, as increased asset management fees from Triple T were offset by lower EBITDA from the Dawsonville Bluffs joint venture, which effectively wound down in 2019.

We also paid a dividend of $0.135 per share to stockholders on December 15, 2020, which was fully covered by cash from operations. For the full year ended December 31, 2020, CatchMark generated revenues of $104.3 million compared to $106.7 million in the prior year.

Timber sales revenue was also comparable to prior year, $72.3 million compared to $72.6 million in 2019, as total harvest volumes increased by 3% offset by lower pricing from our US South region.

Timberland sales revenue decreased by $2 million to $15.6 million and asset management fees were higher than in 2019, due to the amendment of the Triple T joint ventures asset management agreement completed in the second quarter of 2020. Net loss improved by $75.8 million, from $93.3 million for full year 2019, to $17.5 million for full year 2020.

The improvement was primarily due to an $85.4 million decrease in losses allocated from the Triple T joint venture. Adjusted EBITDA exceeded guidance totaling $52.1 million, compared to $56.9 million for full year 2019.

The year-over-year decrease, which we anticipated, was primarily due to a $4.4 million decrease generated by the highly successful Dawsonville Bluffs joint venture.

Breaking out adjusted EBITDA by segments; for a full year 2020, harvest EBITDA increased over full year 2019 from $33.7 million to $34.2 million, helped by increased harvest volumes and higher pricing in the Pacific-Northwest and higher-than-average market pricing for timber sales in the US south.

Real Estate EBITDA registered ahead of plan decreased in year-over-year by $1.9 million to $14.7 million. Investment Management EBITDA declined by $4.1 million to $12.6 million, due primarily to the Dawsonville wound down. Now, let us review CatchMark's capital position.

Over the course of 2020, capital recycling, credit agreement amendment and an active interest rate risk management strategy combined to put CatchMark in a strong liquidity and capital position for meeting the year's considerable challenges, and the company is poised to capitalize on the anticipated economic recovery.

During the year, we completed $21.3 million dollars in capital recycling through a large first quarter disposition, realizing $1.3 million in gains and paying down debt by $20.9 million while enhancing portfolio average stocking in core operating areas. We maintain healthy liquidity.

At year end, we had nearly $163 million of liquidity consisting of approximately $116 million under the multi-draw term facility, $35 million under the revolving credit facility, and $12 million of cash on-hand.

We removed certain restrictive financial covenants, providing increased working capital under credit facilities and lowering unused commitment fees. And we maintain a stable leverage profiles, with net debt to adjusted EBITDA in line with the company's average since the IPO.

During 2020, CatchMark repurchased 305,000 shares for a total of $2 million under our share repurchase program. At year end, we had approximately $13.7 million remaining in the program for future repurchases. We did not complete any repurchases in the fourth quarter.

Entering 2021, we remain focused on rigorous and thoughtful execution of capital allocation priorities, maintaining healthy liquidity, having ample working capital, continuing debt repayment, identifying strategic dispositions and acquisitions, as well as opportunistically making share repurchases, and our overriding objective and commitment remains to deliver fully covered quarterly dividends.

Now, Todd will cover operations..

in the US South, we realized premiums for stumpage prices for pulpwood and sawtimber, 49% and 20%, respectively, above TimberMart South south-wide market averages; in the Pacific-Northwest, that timber revenue of $5.7 million more than doubled 2019 results, driven by an 80% increase in harvest volume and an 18% increase in year-over-year sawtimber pricing.

Timberland sales for a full year 2020 of 9300 acres for $15.6 million exceeded the upper end of guidance. The total number of timberland sales transactions, 37, was the highest for any one year in CatchMark's history, as we capitalized on increased retail demand that emerged in the wake of the pandemic.

Looking ahead, supported by solid housing numbers, we expect the positive trends for log prices and revenues in the Pacific-Northwest to continue in coming quarters and to register further gains in the US South, as new projects come online in and around our micro markets.

After a rollercoaster ride in the fourth quarter, lumber prices have remained strong, even heading above $1,000 per 1000 board feet in the first quarter of 2021.

Our customer orders have strong visibility into the year and sawmills are running at 90% plus capacity, better than historical averages, with any bottleneck to added production tied to labor and COVID impacts. Meanwhile, pulp product markets have remained steady during the fourth quarter and the trend continues into the first quarter of 2021.

After finishing with a very strong fourth quarter and ahead of plan, the timberland sales outlook appears robust in 2021, with continued high levels of interest and activity. We anticipate a majority of closings to occur after the first quarter.

Considering all the ups and downs of 2020, there was a very strong year for operations, and we have good momentum entering 2021. Brian, back to you..

Thanks, Todd. The team did a great job in maximizing productivity from our assets, utilizing delivered wood sales to deliver consistent cash flows, taking advantage of stumpage sales opportunities in our micro markets, and being nimble to navigate the various challenges we faced.

The result was a very strong year in all of our key performance metrics, and that leads into CatchMark's guidance for full year 2021. We project a GAAP net loss of between $6 million and $10 million, with no expected additional losses from Triple T.

Adjusted EBITDA is expected to register in a range of between $43 million and $50 million, which is consistent with 2020 guidance. Harvest volumes are forecasted between 2 million tons and 2.2 million tons, reflecting consistent annual productivity on a per-acre basis from our high quality assets.

Harvests are expected to increase sequentially during each of the first three quarters, with fourth quarter volume approximating the average of the year.

Approximately 95% of forecasted harvest volumes will be derived from the US South region, with a sawtimber mix of between 40% and 45% from the US south, and between 85% and 90% from the Pacific-Northwest.

Asset management fee revenue is projected at approximately $12 million, and our Timberland sales target of between $13 million and $15 million remains around 2% of the acreage. Taken together, we anticipate continuing to meet our strategic goals during the year ahead.

We will remain focused on continuing to deliver sustainable and predictable cash flow, sustaining industry-leading metrics for higher productivity per acre, maintaining healthy liquidity and a stable leverage profile, positioning the company for transformative opportunities through capital recycling, and most importantly, generating a fully covered dividend.

All signs point to a favorable outlook for housing in a more normalized post-pandemic economy to help support demand fundamentals. In addition, as discussed, we anticipate benefiting from ongoing middle market expansion in and around our prime US South timberland base.

In conclusion, CatchMark's operating strategy proved its value again in 2020, helped us manage through a difficult year for the economy and delivered results exceeding company guidance for the full year.

Most notably, we continue to achieve pricing premiums well above industry averages, because of the superior quality of our timberlands, the middle markets we are located in, and our delivered wood sales model supplemented by opportunistic stumper sales. And CatchMark's excellent 2020 fourth quarter provides momentum for us entering 2021.

Our capital position remains strong and liquidity is ample and we'll remain disciplined in our capital priorities, including assessing new investment opportunities.

Amendments to the Triple T wood supply agreement have allowed Triple T to realize market pricing on all timber sales, enhance the future value of the asset and put in motion recapitalizing our investment in the joint venture.

And the positive long-term outlook for housing markets bodes well for strong demand in our middle markets, and overall, improved demand for wood products. Our team is fully engaged in ensuring that CatchMark continues to deliver attractive dividend fully covered by cash flow from operations and to provide long term shareholder value.

We look forward to delivering strong results in 2021. Thank you again for joining us today. And now Ursula, Todd, John, and I, will be happy to take your questions..

[Operator Instructions] The first question comes from Anthony Pettinari of Citi. Please go ahead..

Good morning. This is actually Randy Toth sitting in for Anthony. I just wanted to touch on the harvest volume expectations for full year 2021. I think you're guiding to something like down 10% at the midpoint year-over-year, can you just talk about what is driving that expectation? Thank you..

Good morning, Randy. This is Brian, I'll first start on thinking about our business model, it's really about high productivity, the assets which we own, we're looking at maintaining that around five tons per acre.

And so, you have to look at context of what we've been doing a better part of the last two, three years -- has been going through capital recycling. We've sold off approximately 30,000 acres of lower productivity assets.

And that has had a slight negative impact to us from a gross volume standpoint, but it's not -- it is actually addition by subtraction from a productivity standpoint, because those assets on a forward-looking basis were either going to be neutral to dilutive on a cash basis.

And so, even though you may have productivity numbers of one to two tons per acre, you combine that with our regular way land sales, that gets into your aggregation associated with a reduction in a year-over-year basis, really tied back to what we believe is smart capital allocation regarding low producing assets.

Todd, anything else to add regarding our volumes for 2021?.

As you look at just the overall productivity on top of that is -- the land sales that were sold, were lower productivity compared to the core, so we're selling off 15, 20 tons per acre. Now, at the core, we're still not 40 to 41 tons per acre. And so, from the overall productivity going forward, we're in really good shape.

Throughout the year, we're going to build this total production probably a little bit under that 25% in the first quarter, and then ramping up through third quarter and leveling off there in the fourth..

Just to put another emphasis on there, our productivity on a per-acre basis has been very consistent at that five tons per acre per year. So, no real change in underlying core assets..

Got it. Maybe shifting to the Pacific-Northwest, have you seen any impact on pricing or demand from the fire salvage efforts in the region? I think one of your competitors called out some localized impact in Oregon. I just want to make sure that wasn't affecting the abandoned [ph] property at all..

Hey, Randy, This is Todd. At this point is still early to see how that's all going to flow in. But just from refreshing kind of where the impact of the fires located, that was not directly around our property there. So it would have been to the north and maybe to the east of us. So far, we haven't seen that come in. But again, it's early season.

First quarter, rainy events and those kind of things impacting production right now, a little early to see or to say just how much that's going to impact us going forward from a salvage perspective. And then also, what's that going to do as far as maybe the export business. Typically, fire salvage material doesn't really make it into the export side.

So there could be some upside potential there if you have green logs and the ability to capitalize on that going forward..

Okay, understood. Thank you. I'll turn it over..

The next question comes from Paul Quinn of RBC. Please go ahead..

Yes, thanks very much. I appreciate the added color. Just how forced the market report back in September, you're trying to estimate the amount of excess sawtimber in the U.S. So, then they're putting it on a 10 billion board feet of lumber, which is sort of equivalent to 40 to 50 mills. I know you guys are locating sort of tighter with that feet [ph].

But would that be consistent with what you're thinking the overall U.S.

South?.

Good morning, Paul. Brian Davis. The force market, we took a look at that as well and we believe is dated a number of years back. But from the standpoint of the overall U.S. South, it is micro market driven.

We've heard some announcements of private investments in the state of Mississippi and I would not expect to see an impact -- a positive impact on pricing there just from a demand standpoint because of the excess supply. Now from our standpoint, what we what we've seen from an expansion, not too dissimilar to Interfor's acquisition of WestRock.

The first thing that they talked about was increasing the capacity associated with that mill. It's slightly outside our procurement area, but it's in the coastal market and we would anticipate seeing an increase in pricing from our standpoint. So, the challenge here, Paul, is that the U.S. South is not all equal.

And so from the markets, what we're looking at, we would anticipate kind of low single digit product price appreciation or markets, which is somewhat different than our natural peer set is talking about. Again, it goes back to our micro markets being driven by the increased consumption of wood products.

And what's interesting to know, we did talk about an increase in capacity of the sawmills of over 20% since 2018, but you're still seeing lumber prices drive where they are.

So, from that standpoint, we believe the wood products industry has followed behind housing, which we think housing has in a duration that will help ultimately drive product pricing in the U.S. South and we believe we are the first ones well positioned in order to participate in those price appreciation..

Yes, okay. And then in your discussions with your log buyers in your individual markets, and then obviously the sawmillers are making record profits here. So, they have the ability to give up some of this fortune that they've got. Is there significant pushback? I guess there's lots of opportunity for them to go to different suppliers.

Why aren't prices moving up more than the incremental 2% to 4%?.

Yes, Paul, this is Todd. Right now, you're seeing some of that. I think during the first quarter, we will see maybe a little bit of an outsized increase in price just to a couple of factors here. One, it's weather, so that's going to be driving some of it.

You also have new capacity coming in and as they're building their place in the market, if you will, you might see some outsized production or push to begin to fill their orders as well. It feels like it's a little early to try to bake in 6% to 7% change across the course of the year because we've seen so much of this be cyclical for us, if you will.

As you move into the drier seasons, you don't have to move out as far production is easier for everybody. More people can fit in there. It's a matter of them balancing their production. We're still not seeing sawmills out there trying to build a lot of inventory from a log standpoint.

What's happening as logs are coming in, they're milling it and immediately shipping it out. You know how that ties directly back to what we're seeing from housing. Also, your box stores, your repair, remodel, all of this just is driving such at the demand, there's still only that three to five days, maybe seven days max inventory front or back.

They're being able to cover their needs, I guess is my point there. They're not in a scramble mode to where they're having to just price out there to get the volume up and above where they currently are. I would expect you want to be pretty strong on coming out of the gate, just with all the factors going on.

Again, as I stated with weather and new capacity coming online..

Okay, and then just lastly, just any issues that you guys have had on the on the personal productivity side, related COVID?.

No, we have not. I think we stated earlier on how we had managed our position here at the office with people alternating. We're also set out to where everybody has their own space. There's no cubicle or anything like that.

Third party managers in the field are from the course of the business, they work and they're already social distanced, and they've all managed that really, really well. A lot of people have gone more what we have seen.

It's interesting, you've seen a little more technology go into the field where people are using iPads and other connectivity in order to fill out reports and those kind of things so they don't have to necessarily be in-person all the time. So now we've been able to manage to that very well..

I think the biggest challenge there is related to really the mills and we've seen some slowdowns or some shut downs as a result of COVID activity that we really did see last year. We haven't experienced any of that as we sit here today recently, but that could be always a hang up associated with that..

A little more on that, too. It's interesting how mills would transition their management of these issues.

And early on, we saw some where if they had a COVID issue, the whole mill would shut down and then they started breaking up into areas, or sections, they might take out if someone worked in a planer area, they might have to shut down the planer -- do all over their cleaning and what needed to be done there and then get back up and running.

So, they've managed through that transition as well..

Great. Thanks very much..

Thanks, Paul..

The next question comes from Buck Horne of Raymond James and Associates. Please go ahead..

Hey, thanks. Good morning.

Just wondering if there's any assumption baked into the EBITDA guidance? Or what's your thought around logging and hauling costs over the course of the year? Do you expect more inflation there? How does that affect the overall EBITDA guidance in terms of just operating costs this year?.

Hey, good morning, Buck. No, what we're seeing right now is that it's pretty much going to be your operating cost and we're not hearing or experiencing any type of major upsurge, if you will, in the cost to run the business.

You end up seeing maybe an increase depending upon really the freight and how far we're having to go to move product and those kind of things. But again, that tends to move seasonally as well. From the overall production of moving, from stump to truck, all that's been really consistent.

I guess the one thing would be just what ends up happening with oil prices as we go forward. And right now, it's kind of early to say if there's going to be much change to that. Should that have a major move, then yes, we would anticipate maybe some changes down the road or impact of the actual cost of running the business..

Yes, and just to add on top of that, Todd, from the standpoint of diesel, we do have some of our wood supply agreements that allow for adjustments associated with diesel prices. And so, that does act as a partial offset especially in our pulpwood business..

Yes. No, that's a good point..

Okay, that's great. That's great. That's helpful, guys. Thank you. I think I know the answer to this question, but I figured that out [ph] anyway.

But, with the economics of the sawmill business being so strong and with the outlook for continued growth and kind of a long-tailed upcycle and housing, obviously, there's a lot of economic incentive out there for people to do some Greenfield projects.

But do you consider ever the possibility of more vertically integrating the model? Maybe looking at sawmills within your wood baskets to kind of capitalize the full value chain? Is that something that you kick around in the back of your mind in terms of adding that to the portfolio?.

Sure, Buck. This is a fun, hypothetical question. So, if you would have asked this of me in 2006, then I would have told you no. And if you'd asked me in 2021, I'll tell you, yes. If you can tell me which time period we'd be operating a sawmill, maybe hypothetically, we can consider it ever. I think those were your two words.

But now we're a timberland company. We grow trees, Buck, and that's what we're really, really good at. We allocate capital in the right markets and effectively through a delivered wood model. We're paired up with the right sawmills to operate with along with the pulp mills.

And so, from the standpoint of a return in capital, I get that during these periods of time, but you really have to have a 10-year mindset relative to that. And we do a really, really good job operating a forest. We really have to have a partner come in to run a mill if you'd ever want to do that in a joint venture format.

But that is so low on our priority list. It's kind of something you'd write down on a napkin more than anything else. So, it's not a priority for us at all..

All right, great. Appreciate the context. Thank you, guys..

Thank you..

The next question comes from Dave Rogers of Baird. Please go ahead..

Hey, guys, it's Nick on for Dave. Thanks for the update on the details for guidance.

I guess, one question I kind of wanted to dig into is what does the acquisition pipeline look like at this point in time?.

Hey, Nick, this is Brian. It really centers around our capital priorities at this standpoint. It's really about the dividend liquidity leverage, share repurchases and then acquisitions. The acquisition market in general has been very, very light from the standpoint of deals coming to market.

And that really bodes well for us as we think through the opportunities associated with Triple T. But we're always in the market, we're always looking at opportunities.

This time last year, what I would have told you is consistent with what I'll tell you today, is that we liked the small bolt on acquisitions that are close to us and that kind of $1 million, to 10 million, $15 million-size range. But as we sit here today, we'd have to really weigh that relative to share repurchases and leverage..

Okay, yes, just along those lines, if the right opportunity presents itself, what is your guys appetite to issue equity to fund acquisitions at this time?.

So, you can really take a look at what we've done historically. So, when we made the Coastal acquisition back in 2017, we actually paired an acquisition with an equity offering. It was accretive to us relative to that acquisition. So, our share price would have to be at a working share price in order to do that.

So, it's consistent with what we've done in the past..

Great, that was it for me..

Thank you..

The next question comes from Brian Gibson of Raymond James. Please go ahead..

Hey, guys. Appreciate the time here. I'm just trying to understand the company better. And this question-and-answer period is very helpful. Just listening to your answering the other questions. But I've got a few questions here.

Again, just trying to understand the company better, what percent of revenue comes from pulpwood, versus two-by-sixes? Or what percentage of revenue comes from pulpwood and then what percentage comes from like OSB board or two-by-sixes or two-by-fours?.

Hey, Brian, this is Todd. So we think about overall production and running of our business here. Pulp is going to represent, little better than 50% of what we do, kind of on an annual basis from a production standpoint. Then you look at our solid wood production that comes in, that's another 30% to 50% of that sawtimber production, if you will.

That includes smaller logs as far as chipping saw and also the large timber, which was your sawtimber products. Of that sawtimber probably represents, 20% to 30% in the overall mix, which would cover part of your two-by-six production question there, if you will. And then OSB would be involved in part of our overall pulpwood production.

So, it's mixed within that total volume, if you will. So, if you were on 2 million tons, you'd be looking at about a 1 million to 1.1 million tons of our production is on the public side..

The next question comes from Craig Kucera of B. Riley Securities. Please go ahead..

Yes, thanks. Good morning, guys..

Hi, Craig..

I do appreciate the color you gave on the soft primer pricing expectations in 2021.

But what do you attribute the decline in pulpwood pricing from last year? And kind of what are your thoughts on pulpwood prices as we move through first quarter?.

Hey, Craig, this is Todd. Yes, so it was a just from an overall market perspective, what we saw, they were ample production coming in, you had a lot of movement. You think about earlier in the year, we had sawmills go down, take downtime due to COVID shift, went more towards the pulpwood side of things. So, you had added production going into it.

So, it really comes down from the supply side, if you will. It was extra supply, hit the market. And then you look at going forward, again, I would echo my comments earlier about Q1 being strong.

It's kind of across the board right now and all products weather-driven, if you will, timing, so you'll see some cyclicality around that anticipate 2021 being a good year on the pulp side.

It's going to be very consistent as it has in years past the counterparties we have with containerboard as well as the flow of pulp markets, those kind of end uses are going to be very, very strong and in-demand.

So, we would anticipate, again a good year there with a little bit of upside associated with it as you get back to more of a normalized kind of harvesting, if you will, as far as mix across the board thinnings to final harvest which will dictate and impact the amount of pulpwood that really flows into the overall market..

Hey, Greg, this is Brian. Just to add on top of that, it's important to note that OSB is actually a pulpwood product and OSB feeds really well into the new home construction because that represents about 60% of the supply of their manufacturing base goes into new homes and the other 20% goes into repair and remodeling.

So, as you take a look at pulpwood prices, OSB becomes an important consideration from a demand side as well..

Got it.

And circling back to your G&A, I know there was a pickup in 2020 because of some severance cost, but what expectations are baked into your 2021 guidance as far as G&A?.

Hey, Craig, how are you? So, if you look at the G&A for 2021, we'd anticipate for it to go back down to the 2019 levels. As you mentioned, 2020 was impacted by some employment benefits associated with the Separation Agreement. So, when you think through this on a cash basis, you can expect it to be around $10 million to $11 million.

As you look at gross G&A numbers, you will also want to bake in another $2.5 million of equity compensation..

Okay, great. And one more for me. I feel like at certain times you've had some fairly large land sales that were kind of out of the ordinary of selling -- 1% to maybe 2% of the portfolio.

Are any of those on the table this year?.

Looks like, what are you referring to this kind of capital recycling, if you will?.

Right..

We evaluate portfolio over the course of every year, really. So, as of right now, you're looking more towards our regular way-type business, if you will. And that was where I think in some of Brian's prepared remarks, we're still looking at that around 2% level, if you will..

Okay, thanks..

Thanks, Craig..

[Operator Instructions] The next question comes from Albert Sebastian of Prospect Advisors. Please go ahead..

Good morning..

Good morning, Al..

Congratulations on the good results for the last year..

Thank you..

I got a couple questions.

First, what area the underlying pricing assumptions with regards to pulpwood and saw log prices for your guidance for 2021? Are you looking for down, or flat pricing, or better pricing?.

Hey, this is Todd. Yes, I would think we would be looking from an overall perspective, if you will.

You could be looking at that kind of 3% to 5% on the solid wood side of things moving throughout the course of the year; you'll see some ups and downs, quarter-to-quarter depending upon whatever factors we're dealing with at the time, whether it's weather or if you had a fire season, those kind of things will impact you.

But normal course business for us, you look across our landscape, it's going to be in that 3% to 5% range. We're already at an advantage to most of the regions if you think about our overall position where we are on a pricing perspective. So, that can be still very meaningful for you, starting from a little bit higher point of view, if you will.

And so, I think that would be consistent across the board, just as a general view of where we are. We're anticipating some increases throughout the year..

Good.

And on the asset management fee revenue, I guess you're looking for kind of flat revenue year-over-year for 2021? Is that correct?.

Hey, good morning, Al. Yes, that's correct. So, this is still all based on the asset management agreement that we have for the Triple T joint venture in place, which there was an amendment done earlier in 2020. And so those numbers of $12 million will reflect that already..

And so, I'm just trying to understand, where does it show up the better supply agreements with Georgia Pacific in the Triple T joint venture? Where would that show up in the P&L in terms of, better EBITDA?.

Hey, Al, this is Brian. So, from the standpoint, it's not consolidated in our income statement, and so what you actually see will have supplemental information and our queue in our case, relative on a high summary basis on the performance of Triple T.

And so, what you would see is really from an operating cash flow standpoint, where it stood, but that also includes a lot of other activities such as land sales that goes along with the operation of Triple T. So ultimately, where does Triple T hit with us? It's really an asset management fee, not an operations set of the business..

Did you get a dividend? Does the joint venture pay a dividend then?.

If there is a distribution, it would go in accordance with the capital structure and it would first go to the preferred shareholders and then to us. We have not received a dividend from Triple T at this point..

Okay, okay. And just from a top-down perspective, I'm trying to try to understand the guidance because the guidance -- you're looking for EBITDA to be down about 10% in 2021 versus 2020. We're looking at a lumber market, it's the best lumber market we've ever had. Lumber prices are through the roof.

Your customers are making a lot of money and of course, on the paper side with pulp prices, and line of board [ph] prices, et cetera and quite strong as well. I guess again, G&A is going to be coming down this year versus 2020 and you got better pricing. And I know you got harvest volumes down; so I'm not completely understanding why they're down.

But, just from a top-down perspective, it just seems as though the industry conditions are quite good. They're fantastic for your customers and it seems like you're making the right moves. But yet, as an investor, I'm looking at EBITDA being down 10% this year.

So what conditions -- which I really am not completely understanding -- so I'm trying to understand what conditions are necessary for you to grow EBITDA?.

Hey, Al. This is Brian. I think the question in there is when and so from the standpoint that we have high quality assets, so we're still producing at five tons per acre per year. So that's not really a change.

What you see there from a volume standpoint is a reduction as a result of selling off nearly 30,000 acres associated with capital recycling and then you combine that with a regular way [ph] land sales of about 25,000 acres over that period of time, that gives you about 60,000 acres even at low productivity at two tons per acre, which is diluted relative to our overall portfolio.

That's about 120,000 tons. So that's just a quick math for you on that. As it relates to product price appreciation, Al, this has been from our standpoint, this is the last leg. It's really housing and it's not just housing for a today thing, it's a housing for duration element to it.

And so, if you take a look at our natural peer set, what you're hearing from us is slightly different and that is that we're expecting some product price appreciation in the U.S. South. It's not additional supplies coming in, it's a duration.

So, what we need are these mills to continue to expand or new greenfields to come in and have that radius element to it of consuming wood products in the markets in which we operate in. So, what we're needing is duration of housing, not just a housing event. Now lumber from the standpoint, they've actually under-built their capacity.

Think about it, since 2018 they've had a 20% increase in sawmill capacity, but yet you're still seeing lumber prices to where they're going. And so from that standpoint, more capital coming into this space, more capital coming into the U.S. South, it should bode well for us on the long term basis..

Okay, okay. Thank you..

Great, thanks, Al..

As we are getting close to the end of our time, this concludes our question-and-answer session. I would like to turn the conference back over to Brian Davis, President and Chief Executive Officer for any closing remarks..

Thanks, Andrew. And thank you, everybody, for joining us today. We're excited about 2021 -- the prospects, the team -- we're all excited to see the results throughout this year. We believe it's going to be a transformative year, and you'll be very proud of the results which we'll put forth. Thank you very much..

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect..