Good morning. My name is Rob, and I will be your conference operator today. At this time, I'd like to welcome everyone to the joint PotlatchDeltic and CatchMark investor conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. Thank you. I would now like to turn the call over to Mr. Jerry Richards, Vice President and Chief Financial Officer of PotlatchDeltic, for opening remarks. Sir, you may proceed. Thank you, Rob. Before we start the call, I want to remind everyone that this call will contain forward-looking statements. Please review the warning statements in our press release, on the presentation slides, and in our filings with the SEC concerning the risks associated with these forward-looking statements. I'd like to welcome you to the joint PotlatchDeltic and CatchMark investor call and webcast. With me in the room are Eric Cremers, President and Chief Executive Officer of PotlatchDeltic, and Brian Davis, President and Chief Executive Officer of CatchMark. This morning, PotlatchDeltic and CatchMark issued a joint press release announcing a business combination to further enhance our position as a leading timberland REIT and lumber manufacturer. We're excited to discuss the strategic and financial rationale bringing these two great companies together. I'll now hand the call over to Eric to discuss the merger. Thank you, Jerry. Good morning, and thank you for joining our call on short notice. I'm excited to be in Atlanta, Georgia, this morning with Brian Davis to announce the merger of two great companies with a considerable history of timberland ownership. This combination will further diversify PotlatchDeltic as we will own nearly 2.2 million acres of timberland across eight states. Importantly, approximately 70% of our timberland ownership will be in highly productive and strengthening southern markets. CatchMark operates in some of the strongest markets in the U.S. South with a deep base of well-capitalized mill customers. We will also continue to produce about 1.1 billion board feet of lumber annually, along with 150 million square feet of industrial-grade plywood in our wood products business. Upon completing the merger, we will still be the timber REIT with the most leverage to lumber prices, and we will continue to enjoy the upside from strong U.S. housing fundamentals. In addition, the combination will result in a diverse real estate portfolio with CatchMark's timberlands located close to large population centers. We plan to leverage our rural land sales expertise and strategy along with the CatchMark team's local market knowledge to maximize rural real estate sales opportunities. Increasingly, we are seeing interest in natural climate solutions projects, such as the attractive solar transaction we closed in the first quarter. The company will be headquartered in Spokane, Washington, and I will continue to serve as President and CEO, and Mike Covey will also remain Chairperson. We plan to maintain a regional office here in Atlanta. There are three major benefits to the combination of the companies that will provide meaningful CAD synergies going forward. First, there's an opportunity to reduce the cost of managing CatchMark's timberlands by insourcing those activities and managing them under the successful PotlatchDeltic model. Second, there is also an opportunity to reduce corporate overhead, which is currently required to run two separate standalone public companies. Third, we plan to use a portion of our existing interest rate swaps to refinance CatchMark's debt at lower rates. There are a series of slides accompanying this presentation which provide more detail about the merger and outline the benefits. Let me offer some background on how we got here, and then Brian will provide some comments on why he and the CatchMark board feel this is the right combination for their organization. We approached CatchMark about combining our companies several months ago. We had many discussions with Brian and his team to explore the merits of a merger, and we are pleased to have reached an agreement that benefits both companies. Under the terms of the transaction, CatchMark stockholders will receive 0.23 shares of PotlatchDeltic stock for each CatchMark share. This values the company at approximately $919 million based on PotlatchDeltic's closing share price on May 27, 2022, including approximately $273 million of CatchMark net debt. Importantly, this stock structure will provide stockholders of both companies with the opportunity to participate in the significant upside potential of this combination. We are confident that combining our complementary assets and operations will allow us to create stockholder value greater than what could be achieved by either company independently. The merger is expected to close in the second half of this year, subject to completion of customary closing conditions, including approval by CatchMark stockholders. We look forward to achieving the benefits of the combination. Now let me turn it over to Brian for some comments. Thank you, Eric. I agree with Eric's comments wholeheartedly. We at CatchMark are excited about combining the two companies and unlocking value for our stockholders. Over the last two years, we set out to simplify our business, reduce leverage, and position CatchMark for growth. We also developed a comprehensive plan to maximize value for our stockholders on a standalone basis. Our recent strong results highlighted those efforts. We also conducted a robust and competitive exploration process with several external parties, including PotlatchDeltic. Having considered all the options, the CatchMark board and I are convinced the combination with PotlatchDeltic is the best path forward for our stockholders. I'm personally committed to work with Eric, the other senior executives, and the board of directors to ensure we successfully execute on the potential of the merger to unlock value and capture the significant benefits of the combined company. Let me turn it back over to Eric for additional comments. Well, thank you, Brian. We very much look forward to working with you to make the combined companies one of the nation's leading timber REITs. We are confident about the financial underpinnings of this merger and its benefits for the stockholders and employees of both companies. Excluding one-time costs needed to achieve the synergies and a full synergy run rate, we expect cash available for distribution, or CAD, per share will be modestly accretive in the first full year after the merger closes. As you can see on slide 12 in our materials, we've identified an estimated $16 million of synergies that will lead to an increase in CAD. We are confident in our ability to attain these synergies, especially with Brian's knowledge and help. We will issue approximately 11.5 million shares of PotlatchDeltic stock to CatchMark stockholders to consummate the merger. Once the merger is complete, CatchMark stockholders will see their dividend increase approximately 35% when you adjust PotlatchDeltic's current regular dividend for the exchange ratio. The addition of CatchMark's cash flows and the CAD synergies provide strong coverage for our attractive and growing dividend. Also, continued strong lumber prices mean there is a high potential that we will pay a special dividend in 2022. Before opening it up to questions, let me say again how excited we are to be combining two great companies that will offer investors more scale and liquidity, a larger geographic footprint, more market diversity, and a sustainable long-term value. For the employees of each company, there will be more opportunities for growth and advancement. We are also pleased to continue a strong presence in Atlanta and throughout the rural communities where both companies operate. We continue to have strong earnings from our core businesses here in the second quarter, and we expect to report another excellent quarter on our earnings conference call in July. Rob, we will now turn the call over for questions. At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. Your first question comes from the line of Mark Weintraub from Seaport Research Partners. Your line is open. Thank you. Good morning. First question. As we think about the targeted $55 million of EBITDA on a go forward basis, including the synergies, how much, if any, is related to non-timber harvest type of monies in that $55 million? You know, Mark, this is Eric. It's typical of most timber REITs. You know, it's roughly a one-third, two-thirds split, one-third kind of the real estate side and two-thirds the timber side. I see that in our business quite often. I see it in Rayonier's business quite often. That seems to be the typical split, and it's no different here. Okay. When we look at the harvest rates for this year for CatchMark, which they provided in their guidance, is that kind of the sustainable harvest level? Maybe more specifically, is the harvest levels in that 55 million where is that kind of on a sustainable basis versus long term? Is it right at it? A little low? Maybe if you could just talk a little bit about the harvest profile going forward. Yeah, Mark, it's a good question. You know, CatchMark's guidance is 1.6 million-1.8 million tons per year. We obtained their timber inventory detail as we were working through due diligence, and we completed an in-depth harvest schedule analysis as part of our due diligence. We think their harvest volume going forward will be in this 1.6 million-1.8 million tons for about the next 10 years or so. Then it will drop just a little bit, maybe 100,000 tons or so for a few years, and then it'll come back, you know, a few years down the road after that. It'll be in that zip code. There will be a dip in about 10 years, but it's a very modest dip. Okay. You mentioned you know, accretive on a CAD basis in the first year. To the extent you can provide more color on how you get to that'd be great. You said that that sort of did not include one-time costs. If you could just sort of bracket the size of the one-time cash outflows in particular, that would be helpful. Yeah. Mark, as we you know, look at the pro forma going forward after synergies, CAD is around $42 million per year on average. If I think about the incremental shares that we're gonna be issuing in the merger, 11.5 million shares, I think about our you know, current run rate on our dividend, $1.76. That's about $20 million per year in increased dividend payments to the you know, the shares we'll be issuing to CatchMark stockholders. If our average is $42 million going forward and our extra dividend is $20 million, there's a net $22 million, that's accretive across all 81 million shares. Yeah. Okay. That's sort of like an EVA type calculation, just to clarify, as opposed to a per share. Is that the way to think of that? Yeah. Yeah. Got it. Okay. You asked a question about one-time costs. Jerry, you want that one? Yeah, you bet. Good morning, Mark. In terms of one-time costs, you know, the estimate is it's a range of somewhere between $25 million and $30 million. That includes, you know, investment banking and advisor fees for both companies, change in control payments. It also has some offsets. You know, when we think about refinancing CatchMark's debt, you know, they have some interest rate swaps that are nicely in the money, and they also have some patronage that's in the form of equity that'll be refunded over time as well. Can you ballpark what those are? Is that relative to the 25-30? The interest rate swap, I think the last valuation I saw was the end of April, is about $12 million. Okay. The patronage that would come back is in the $4 million-$5 million range. Okay, great. If I could sneak one last one in and then certainly hand over. Since you brought it up, on the refinance, could you kind of explain a little bit how you're gonna use interest rate swaps and how that's gonna, you know, be to the benefit of shareholders? You bet, Mark. If you recall back in March 2020 when financial markets were dislocated, we did a large interest rate swap that essentially locked in a whole series of future refinances for us into January 2029 at, you know, just extraordinarily attractive levels. We've had those swaps outstanding and, you know, the value recently of the whole trade is between $90 million and $100 million if they're in the money. We have an opportunity here to pull a portion of the remaining swaps forward and actually apply those to the refinance of CatchMark's debt. What that does at the end of the day is where you have. You know, when I go get quotes from Farm Credit System, I think about a net of patronage. To get a fixed rate loan is probably on a 10-year basis around 4% or so, maybe a little higher. You know, using these swaps will allow us to refinance at, like, about 2.35%, just to give you the latest quote. Not only reduce CatchMark's interest expense run rate, but also, you know, we're also gonna be able to refinance at well below market rates currently. Is that what? Because I think Eric had mentioned a CAD 42 million number when we were just having our quick conversation there, which is different obviously from the CAD 55 million. Is that related to the difference between those two numbers, or is there something else going on? If I were to step back, Mark, make sure that we have, you know, all of the data points triangulated here. You know, we have $16 million total of synergies, CAD synergies. About $13 million of that are cost synergies that Eric was touching on, so that's the SG&A, you know, reduction as well as, you know, timberland management. Then the 3 million would be roughly the interest savings here all in, and that gets you to $16 million total CAD synergies. Okay, great. I'm sorry, maybe I misheard, but had Eric mentioned a CAD 42 million annual number and maybe the other, I guess, was an EBITDA number. How does that triangulate with the $55 million number? If I understand your question, Mark, you know, we obviously there's some CapEx, you know, to reforest, you know, that'd be a deduct. Also Got it. You know, there's interest expense and, you know. There's some moving parts. You know, you think about it, EBITDA is $55 million on average for the first five years. You know, CAD, you know, $42 million, maybe $44 million, somewhere in that range on average for the first five years. You know, if you wanna go through the details, I'd be happy to, you know, happy to walk through that with you after the call. Sure. Appreciate it. It was the EBITDA and CAD. Got it. Thanks so much. Yep. Yep, thanks. Your next question comes from the line of Kurt Yinger from D.A. Davidson. Your line is open. Great. Thank you, and good morning, everyone. Morning. Just wanted to start out on the decision to fund the deal with stock. I mean, looks like from a liquidity perspective, you would've been able to fund that equity portion with cash. Maybe you could just talk about the thought process around that decision? Well, we probably could have found a way, Kurt, to finance it with stock. You know, the CatchMark shareholders, number one, they wanna participate in the upside from this merger. Number two, you know, it's great when you can use equity to finance a deal. It strengthens the balance sheet going forward. We've still got the best balance sheet in the industry that leaves us with a lot of dry powder to do more interesting things. It was just the right capital allocation decision. Yeah. I'll jump in, Kurt, and just add a couple of comments as well. You know, certainly we have. You know, cash continues to build. I mean, we're at $471 million on the balance sheet at the end of last quarter, and no surprise with where lumber prices have been. You know, that cash has continued to accumulate. I mean, certainly one of the things we thought about are other opportunities to use that cash. You know, we have a line of sight or we have expectation that there's some really interesting other opportunities, you know, which, you know, we look forward to, you know, down the road to sharing more about those. Okay. All right. That's helpful. Hey, Kurt, before we move on, just one last thing. Yeah. You know, we get asked questions all the time about why aren't you guys buying back stock? The way we answer the question is, you know, we're opportunistic share repurchasers. We wait for there to be a dislocation of our stock, and then that's when we're gonna step in and buy it. When you have that approach, you need to make sure you've got flexibility with your balance sheet to be able to step in and do that. We've got, who knows, $100 million, maybe more on our balance sheet that's kinda set aside looking for an opportunity. I don't want the stock to go down, obviously, but if it does go down, we've got the firepower to step in and do something meaningful. Right. Okay. That makes sense. Just on, I guess, the diversification of your southern timberlands footprint with CatchMark, I mean, can you just talk a little bit about the long-term benefits or opportunities around that? I mean, previously, right, you guys were heavily concentrated in Arkansas. It looks like you'll add a couple states in a couple new geographies. You know, how do you think about the benefits of that longer term? You know, it was an interesting opportunity, a very unique opportunity for us to move eastward from where we were over in Arkansas, Alabama, and Mississippi. You know, we'd hear about deals all the time that were over in the Atlantic Seaboard area, and we could. They're all typically pretty small. You know, we have no operational horsepower over in those markets, as you know. We could never figure out a way to grow the company over into those areas. Well, CatchMark provided us with that opportunity. Number one, it's scale. It's a company with, you know, 350,000 acres, so it's not a small bolt-on deal. We could never justify doing a small bolt-on deal that far from where our human resources were located. It's also phenomenal timberland. When you step back and you look at it, their average site index is 75. That compares, 66 for us in Arkansas. 66 is a good, strong number, of course, but 75 is off the charts strong. They've got 20% of their plantations are currently mature, which means, great stocking levels and solid cash flow for the next, 8-10 years. They operate in some of the best markets in the U.S. South. If you look at, we've got a pricing chart in our investor materials. If you look at the pulpwood prices that they get, over $15 a ton. You know, we're getting $4-$5 a ton over in Arkansas, so just phenomenal pricing. You know, in addition to picking up some great assets and their people going forward, just so many different ways it was a synergistic combination. I really couldn't be happier. Got it. Okay. That's helpful. Thanks, Eric. Just my last one. You know, as part of the Deltic merger, there were, you know, quite a bit of synergy and value capture opportunities kind of above and beyond those originally outlined. Obviously the earliest of days here, but as you look at CatchMark and the combined business, are there any areas where you think there could be kind of upside to what you've laid out or, you know, I guess, areas where you weren't necessarily confident in putting in the synergy numbers, but you think there is potential for further upside down the road? Yeah. I would say potentially on the real estate side. If you look at our history of doing large real estate deals over in Arkansas, we've done a number of them, whether they're conservation deals around Lake Maumelle or the solar power deal that we just got done completing here in the first quarter. We've got a history of putting up big real estate transactions at incredible prices. That might be one area where we might dig a little deeper as we get into the real estate side of CatchMark. We really didn't put in any synergies for real estate here. Frankly, we didn't for Deltic either. We were very pleasantly surprised as Deltic unfolded. Yeah, you're correct, we did outpace our synergy targets with Deltic. I would say that, you know, our synergies here, they're more predictable than they were with Deltic. I'd say there's probably less upside than there was with Deltic, but that doesn't mean that we can't exceed our pro forma. My confidence level is far greater here with these CatchMark synergies than the synergies that we had identified with Deltic, for example. There's puts and takes. There may be less upside here, but there's more certainty here too. Got it. Okay. Well, thanks for all the color, and I'll turn it over. Our next question comes from the line of Ketan Mamtora from BMO Capital Markets. Your line is open. Good morning, congrats on the transaction. First question, I was just curious, within the $55 million EBITDA number, have you all contemplated any price increases, particularly on southern timber, or is that based on current price levels? No, Ketan. In our pro forma, we've got very modest price increases going forward. There's been a huge bounce here over the last year or so, and, you know, we modeled only very modest increases going forward. Not much from pricing. Got it. Okay. Then, Eric, can you touch a little more on sort of the real estate opportunity? As you see, you talked about kind of synergy, but just in terms of kind of ability with sort of the real interest that we've seen over the last 12-18 months, what kind of opportunity there is on the real estate side? Well, I think, you know, historically, our like I just got done mentioning, you know, we've got a track record of doing large transactions, real estate transactions. You know, that solar deal we did in the first quarter was a great one. You know, if you look at the conservation deals that we've done over the years, we have the ability. Our real estate team has the ability to find and bring to fruition these larger, higher priced transactions. So I think I'll ask Brian to- Yeah. Certainly. He knows the land better than us, but. Yeah. Certainly. Thanks, Eric. This is Brian. So from our standpoint, you know, you take a look at Georgia and South Carolina, you have a strong influx associated with population growth in these marketplaces. As a result of that, you know, with the additional scale that Potlatch brings us is an opportunity to really unlock value that we didn't have before, but the demand fundamentals are very, very strong, even from a reverse inquiry standpoint. The combination of the two companies really gives us the opportunity to leverage that aspect to really take on the larger types of transactions that Eric's talking about. As CatchMark on a standalone company, we're really restricted by From a kind of internal governors of doing 2%-2.5% of our fee acreage on a per year basis to maintain that 1.6 million-1.8 million tons per year on what we were looking at. By the additional scale allows us, given the types of numbers that we're seeing, especially in reverse inquiry, to really unlock that real estate value. Got it. That's helpful. Just one last question from my side. Does this, you know, kind of merger open up more opportunity on the lumber side, on the sawmill side with, you know, the markets that you are getting in? Oh, absolutely, Ketan. You know, we would never go acquire. I should, I shouldn't say never, but we'd be hard pressed to go, you know, acquire a sawmill that wasn't near an existing operating area for us. We love the integrated nature of our business today. There's lots of value in having an integrated model, as in both timberlands and converting. We'd be really hard pressed to pick up a sawmill in, you know, Georgia, South Carolina, over that area. But now with CatchMark, with our timberlands in the area, we absolutely would pursue a sawmill that's in those operating areas. We love wood products. Understood. That's very helpful. Good luck with the integration. I'll turn it over. Thanks. Again, if you would like to ask a question, press star one on your telephone keypad. Your next question comes from the line of John Babcock from Bank of America. Your line is open. Hey, good morning, and thanks for taking my questions. I guess just to start out, I was wondering if you could talk about whether or not there's any sort of step-up associated with this transaction. Yeah, John, I presume you're talking about purchase accounting, so there absolutely is step-up. You know, CatchMark is carrying their timberlands, which is the primary asset at historical cost. We'll go through a process just like we did with Deltic, where we take the purchase price at the time the merger closes, and we'll spread that across the assets. I would expect, you know, most of that value will be ascribed to the timberlands as part of that purchase accounting process. Okay. Is there, could you provide an initial estimate, or is it too early to tell at this point? Yeah. I mean, when you look at the enterprise value here of $919 million based on the close price on Friday, I would say, you know, probably somewhere in the zip code of maybe $900 million of that gets allocated to timberlands. That's very preliminary. We haven't gone through a formal analysis at this point. Okay. Thank you. Next question, I was just wondering how are you thinking about opportunities associated with the CatchMark business from carbon sequestration and also the non-timber assets? On the carbon sequestration side, you know, I would imagine CatchMark, just like us, we've probably looked at kind of these carbon pricing opportunities that are out there, and they're just relatively small compared to what the timber is worth in a growing state harvested and sold to a pulp mill or a sawmill. Given that their markets are stronger than our markets over in Arkansas, Alabama, Mississippi, if we couldn't make it work over there, I don't think CatchMark's gonna be able to make it work in their areas either. Now, I will say that from this, you know, these other markets that are starting to open up, like solar energy, you know, they've got a number of deals that are in the hopper just like we do, and we will be working closely with the CatchMark team to get those across the goal line. That's where the real opportunity is right now. Gotcha. Thank you. How similar are the silviculture practices between the two? How much opportunity is there, you know, on that front to leverage, you know, the knowledge that one firm has that might maybe the other side doesn't? Anything to add there or? Well, CatchMark, you know, outsourced a lot of their timber management, which made sense when you're a smaller company. You just simply couldn't afford all of the overhead. You know, combining with us, you know, we have that expertise in-house. We'll probably implement our silviculture practices. We'll probably have a more aggressive thinning regime than that they've had, which is gonna give us a higher mix of sawlogs. You know, we might use a higher mix of improved seedlings than they've been using. They're a little bit more expensive, but down the road it tends to pay benefits. You know, all told, you know, they were using really good consultants to manage their timberland. They're reputable firms for sure. We'll still be able to, you know, I don't know, find, create $3 million-$4 million a year of cost savings by bringing that work in-house. There will be some modest changes to their silviculture plans. I assume that $3 million-$4 million is included within the synergy target? Yes. That's correct. Yep. Okay. Perfect. Thanks for all the detail. At this time, I'm showing there are no more questions. I'll now turn the call back over to Jerry Richards. Thank you, Rob, and thank you everyone else again for joining the call on such short notice. We are very excited about this combination, and we will provide updates as the work progresses. Thank you. This concludes today's conference call. Thank you for your participation. You may now disconnect.