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Equity Research

June 17, 2010 Americas


Basic Industries
Paper & Forest Products Paper & Forest Products

Peter Ruschmeier
Industry Overview
1.212.526.9898
PNW Log Prices Up for 13th Month peter.ruschmeier@barcap.com
BCI, New York
Sector View:
New: 1-Positive
Old: 1-Positive

Investment Conclusion
‰ Combining positive momentum for domestic log prices in the Pacific Northwest with historically large public market discounts to private
market values, we continue to favor timber-rich equities such as WY, RYN, and PCL. The Pacific Northwest is especially important to
Weyerhaeuser (1-OW / Positive), home to ~1/3 of their timberland acreage, but nearly 60% of their merchantable volume of timber
inventory. Rayonier (1-OW / Positive) and Plum Creek (1-OW / Positive) also have modest exposure to the region. Among wood product
producers, we believe shares of Louisiana-Pacific (1-OW / Positive) are a timely buy as oriented strandboard (OSB) prices are starting to
stabilize after a significant correction (~35%) over the past six weeks. If/when OSB prices trough and begin to rise again (as we believe
they will in the coming weeks), we believe shares of LPX will also respond favorably.

Summary
‰ RISI released the June issue of "Log Lines," which tracks prices for Douglas Fir and Whitewood logs in the Pacific Northwest.
‰ Douglas Fir log prices rose for 13th consecutive month, up 1.3% sequentially in June. Prices are now up almost 54% from the trough in
May 2009.
‰ Prices for Whitewoods rose for 12th consecutive month, up 8.3% sequentially in June. Prices are now up approximately 68% from the
trough in June 2009.

This morning (6/17/10) trade publisher RISI published their June issue of "Log Lines" which tracks prices for Douglas Fir logs, and prices for
"Whitewoods" (primarily Hemlock) in the Pacific Northwest. Overall, Douglas log prices rose for the 13th consecutive month, up 1.3%
sequentially in June. Douglas Fir prices are up almost 54% from the trough in May 2009. Prices for Whitewoods rose for the 12th
consecutive month, up 8.3% in June vs. May. Prices for whitewoods are up approximately 68% from the trough in June 2009. Despite the
recent strength in log prices, the level of prices is still modest relative to its trading range over the past few years. Against a backdrop of a
recent ~20% decline in lumber prices over the past six weeks, we believe the upward momentum in log prices is likely to stall at some point
in the next few months. However, we remain in the camp that the trough in wood product and log demand/prices is firmly behind us.
Notwithstanding considerable volatility of wood product prices in recent months, we continue to believe the trend for demand/prices of logs
and wood products remains positive.

Combining this positive momentum for domestic log prices in the Pacific Northwest with historically large public market discounts to private
market values, we continue to favor timber-rich equities such as WY, RYN, and PCL. The Pacific Northwest is especially important to
Weyerhaeuser (1-OW / Positive), home to ~1/3 of their timberland acreage, but nearly 60% of their merchantable volume of timber
inventory. Rayonier (1-OW / Positive) and Plum Creek (1-OW / Positive) also have modest exposure to the region.

Among wood product producers, we believe shares of Louisiana-Pacific (1-OW / Positive) are a timely buy as oriented strandboard (OSB)
prices are starting to stabilize after a significant correction (~35%) over the past six weeks. If/when OSB prices trough and begin to rise
again (as we believe they will in the coming weeks), we believe shares of LPX will also respond favorably.

Barclays Capital does and seeks to do business with companies covered in its research reports. As a result, investors should be
aware that the firm may have a conflict of interest that could affect the objectivity of this report.

Investors should consider this report as only a single factor in making their investment decision.

PLEASE SEE ANALYST(S) CERTIFICATION(S) ON PAGE 6 AND IMPORTANT DISCLOSURES BEGINNING


ON PAGE 7
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Equity Research

Figure 1

Pacific Northwest Douglas-Fir Prices

$800
$4.88
$750

$700 $4.38

$650
$3.88
$/ MBF Scribner

$600

$/ cu ft
$550 $3.38
$500

$450 $2.88

$400
$2.38
$350

$300 $1.88
1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010
Source: RISI Log Lines, Barclays Capital Estimates

Figure 2

12-Month Price Target: Ranked by Upside Potential


to Current Share Price with Dividend
90%
LPX WY

70%

50%

30% Industry MWV PCL


RYN

10% TIN
SPP IP

-10%

-30%
Price Target Upside/Downside Potential Dividend Yield

Source: FactSet, Barclays Capital estimates

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Equity Research

Figure 3
$ in millions, except per share figures
Discounted Cash Flow Summary

Company IP LPX MWV PCL RYN SPP TIN WY Total


Sum PV of Cash Flows for Firm (A) 19696 1896 5737 8853 4869 4722 3656 19053 68483

Less: Net Debt 7206 (109) 1434 2427 609 2429 735 3514 18246
Less: Underfunded Pension (B) 2706 58 (806) 34 93 250 291 600 3226
Less: OPEB Liability (B) 491 0 107 0 21 175 116 591 1501
Plus: Tax Deductibility of Pension Contributions 895 22 (285) 2 14 67 98 148 960
Less: Other Debt Adjustments (C) 327 0 0 (783) (118) 294 82 (300) -498
Adjusted Net Debt 9835 (73) 1020 1676 591 2723 1126 4257 21157
Plus: Sales/Acquisitions (D) 0 0 0 0 0 0 0 0 0
Plus: Other "Non-Debt" Valuation Adj. (E) 0 0 325 0 0 65 90 0 480
Equals: Equity Value 9861 1969 5043 7177 4278 2064 2621 14795 47807
Shares Outstanding 428.8 140.6 173.9 163.1 80.7 515.5 109.2 211.4
12-Month Target $23.00 $14.00 $29.00 $44.00 $53.00 $4.00 $24.00 $70.00 $47,807

Share Price $25.66 $7.96 $24.20 $37.18 $46.70 $4.04 $22.96 $39.95 $39,197
Upside Potential -10% 76% 20% 18% 13% -1% 5% 75%
Dividend $0.50 $0.00 $0.92 $1.68 $2.00 $0.00 $0.44 $0.20 $5.74
Dividend Yield 1.9% 0.0% 3.8% 4.5% 4.3% 0.0% 1.9% 0.5% 2.7%
(A) Calculated from DCF analysis.
(B) For SPP, Underfunded Pension and OPEB Liability are included in Net Debt.
(C) Other Debt Adjustments include:
$327 MM for IP's off-balance sheet debt; $294 MM for SPP for the company's off-balance sheet data, $78 MM for TIN's off balance sheet guarantees
and a $300 MM benefit for WY reflecting land sale proceeds from the real estate segment.
(D) Other Valuation Adjustments are $783 MM for PCL reflecting a timberland JV with the Campbell Group to which PCL
contributed 454k acres of southern timberlands.
(E) Other Valuation Adjustments are $320 MM for MWV which reflects an valuation improvement related to future timberland sales above timber values,
$65 MM fo SPP's estimate value of interest in a Chinese coated paper JV, $90 MM for PV of TIN's AMT tax benefit.
Source: Company Reports, FactSet, and Barclays Capital Estimates

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Equity Research

Figure 4

Barclays Capital Paper & Forest Products Universe


Sector Rating: 1-Positive ($ in millions, except per share figures)
Key Statistics
Company 6/16/10 52-Wk Book Price/ Shares Number of Insider
Companies Ticker Rating Price Hi/Lo Value Book Dividend Yield Out (A) Employees (B) Ownership (C)
International Paper IP 3-Underweight $25.66 $29-$12 $13.57 1.89 $0.50 1.9% 428.8 56,100 1.0%
Louisiana-Pacific LPX 1-Overweight $7.96 $13-$3 $8.78 0.91 $0.00 0.0% 140.6 4,000 0.8%
MeadWestvaco MWV 2-Equal Weight $24.20 $30-$14 $19.13 1.27 $0.92 3.8% 173.9 20,000 0.4%
Plum Creek PCL 1-Overweight $37.18 $44-$27 $9.11 4.08 $1.68 4.5% 163.1 1,252 0.4%
Rayonier RYN 1-Overweight $46.70 $51-$34 $14.56 3.21 $2.00 4.3% 80.7 1,800 1.3%
Sappi SPP 2-Equal Weight $4.04 $5-$2 $3.26 1.24 $0.00 0.0% 515.5 16,427 9.6%
Temple-Inland TIN 2-Equal Weight $22.96 $25-$11 $7.24 3.17 $0.44 1.9% 109.2 11,000 8.0%
Weyerhaeuser WY 1-Overweight $39.95 $54-$27 $19.14 2.09 $0.20 0.5% 211.4 14,900 2.3%
S&P Paper & Forest Index 105.9 127-62 52.84 2.00 2.7% 125,479

Capitalization
Shareholder Net Minority Capitaliz- Net Debt/ Market Enterprise Underfunded OPEB Other Adjusted
Companies Equity Debt (E) Interest ation (D) Capital (E) Cap Value (F) Pension Liability Adjustments Net Debt (G)
Intl. Paper (J) 5,819 7,206 232 13,257 54% 11,003 18,209 2,706 491 (568) 9,835
Louisiana-Pacific 1,234 (109) 0 1,125 -10% 1,119 1,011 58 0 (22) (73)
MeadWestvaco (J) 3,326 1,434 17 4,777 30% 4,208 5,642 (806) 107 285 1,020
Plum Creek 1,486 2,427 0 3,913 62% 6,064 8,491 34 0 (785) 1,676
Rayonier 1,175 609 0 1,784 34% 3,769 4,378 93 21 (132) 591
Sappi (J,K) 1,683 2,429 0 4,112 59% 2,083 4,512 250 175 294 2,723
Temple-Inland (J) 791 735 91 1,617 45% 2,507 3,242 291 116 (16) 1,126
Weyerhaeuser (J,L) 4,046 3,514 11 7,571 46% 8,444 11,958 600 591 (448) 4,257
TOTAL $19,560 $18,246 $351 $38,156 48% $39,197 $57,443 $3,226 $1,501 ($1,391) $21,157

EBITDA Enterprise Enterprise Value / EBITDA


Companies 2009A 2010E 2011E 2012E Mid-Cycle Value 2009A 2010E 2011E 2012E Mid-Cycle
International Paper 2,776 2,938 2,907 2,770 2,602 18,209 6.6x 6.2x 6.3x 6.6x 7.0x
Louisiana-Pacific -52 248 396 455 449 1,011 -19.5x 4.1x 2.6x 2.2x 2.3x
MeadWestvaco 828 897 1,002 1,059 889 5,642 6.8x 6.3x 5.6x 5.3x 6.3x
Plum Creek 427 459 490 582 554 8,491 19.9x 18.5x 17.3x 14.6x 15.3x
Rayonier 363 400 419 449 439 4,378 12.1x 10.9x 10.4x 9.7x 10.0x
Sappi 584 787 1,133 1,322 1,184 4,512 7.7x 5.7x 4.0x 3.4x 3.8x
Temple-Inland 413 430 521 572 527 3,242 7.9x 7.5x 6.2x 5.7x 6.1x
Weyerhaeuser 108 1,267 1,840 2,172 2,111 11,958 110.7x 9.4x 6.5x 5.5x 5.7x
TOTAL 5,447 7,426 8,709 9,382 8,754 57,443 10.5x 7.7x 6.6x 6.1x 6.6x

Adjusted EBITDA (H) Adjusted Adjusted Enterprise Value / Adjusted EBITDA (H) , ( I )
Companies 2009A 2010E 2011E 2012E Mid-Cycle EV (I) 2009A 2010E 2011E 2012E Mid-Cycle
International Paper 3,016 3,199 3,174 3,036 2,753 20,838 6.9x 6.5x 6.6x 6.9x 7.6x
Louisiana-Pacific -33 266 414 474 465 1,047 -31.6x 3.9x 2.5x 2.2x 2.3x
MeadWestvaco 772 834 954 1,011 807 5,229 6.8x 6.3x 5.5x 5.2x 6.5x
Plum Creek 441 473 505 597 562 7,740 17.6x 16.4x 15.3x 13.0x 13.8x
Rayonier 372 415 438 468 451 4,361 11.7x 10.5x 10.0x 9.3x 9.7x
Sappi (M) 611 804 1,150 1,339 1,200 4,806 7.9x 6.0x 4.2x 3.6x 4.0x
Temple-Inland 463 480 571 622 572 3,633 7.8x 7.6x 6.4x 5.8x 6.3x
Weyerhaeuser 90 1,249 1,822 2,154 2,033 12,701 141.1x 10.2x 7.0x 5.9x 6.2x
TOTAL 5,732 7,720 9,029 9,702 8,843 60,354 10.5x 7.8x 6.7x 6.2x 6.8x

Footnotes:
A) Reflects fully diluted shares outstanding from most recent financial filing. J) Refer to following page for description of other adjustments all companies.
B) From 2007 Annual Reports and Company Press Releases K) SPP: Underfunded Pension and OPEB Liability are included in Net Debt.
C) Employee ownership estimated for ABH. L) WY net debt includes debt and cash from WY real estate business (WRECO).
D) Capitalization is defined as : Net Debt + Shareholder Equity + Minority Interest. M) SPP reflects calendar year results. SPP Adjusted EBITDA excludes non-cash timberland revaluation.
E) Net Debt defined as: LTD + Current Portion of LTD + STD + Preferred Equity - Cash. Note: See DCF summary on last page of this comp table for explanations of all net debt adjustments.
F) Enterprise Value is composed of Net Debt, Market Capitalization, Preferred Stock.
G) Adjusted Net Debt is defined as: Net Debt+Underfunded Pension+OPEB Liability+
Other Adjustments. See next page for Other Adjustments calculation.
H) Adjusted EBITDA is defined as: reported EBITDA, plus non-cash pension expense,
plus OPEB expense.
I) Adjusted EV is defined as: Market Capitalization + Adjusted Net Debt.
Source: Company Reports and Barclays Capital Estimates

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Equity Research

Figure 5

($ in millions, except per share figures)


Net Debt Adjustments Adjusted Net Debt
Plus: Plus: Minus: Plus: Plus: Equals:
Net Pension OPEB Tax Deductibility (Sales)/ Other Debt Total Other Adjusted
Companies Debt (A) Liability Liability of Pension Cont Acquisitions Adjustments Adjustments Net Debt (B)
Intl. Paper (D) 7,206 2,706 491 895 0 327 2,629 9,835
Louisiana-Pacific (109) 58 0 22 0 0 36 (73)
MeadWestvaco (E) 1,434 (806) 107 (285) 0 0 (414) 1,020
Plum Creek 2,427 34 0 2 0 (783) (751) 1,676
Rayonier 609 93 21 14 0 (118) (18) 591
Sappi (F,G) 2,429 250 175 67 0 294 294 2,723
Temple-Inland (H, I) 735 291 116 98 0 82 391 1,126
Weyerhaeuser (J,K) 3,514 600 591 148 0 (300) 743 4,257
TOTAL 18,246 3,226 1,501 960 0 (498) 2,911 21,157

Earnings Per Share Price/Earnings


Companies 2009A 2010E 2011E 2012E Mid-Cycle 2009A 2010E 2011E 2012E Mid-Cycle
International Paper $0.89 $1.25 $1.40 $1.50 $0.95 28.9x 20.5x 18.3x 17.1x 27.0x
Louisiana-Pacific ($1.05) $0.62 $1.25 $1.55 $1.86 NM 12.9x 6.4x 5.1x 4.3x
MeadWestvaco $0.78 $1.20 $1.35 $1.60 $0.92 31.2x 20.2x 17.9x 15.1x 26.3x
Plum Creek $1.48 $1.60 $1.75 $2.30 $2.10 25.1x 23.3x 21.2x 16.2x 17.7x
Rayonier $1.50 $2.10 $2.40 $2.75 $2.64 31.2x 22.2x 19.5x 17.0x 17.7x
Sappi (L) ($0.26) $0.00 $0.45 $0.70 $0.56 NM 866.0x 9.0x 5.8x 7.2x
Temple-Inland $0.71 $1.00 $1.50 $1.80 $1.57 32.2x 22.9x 15.3x 12.8x 14.6x
Weyerhaeuser ($2.06) $1.05 $4.15 $5.70 $3.70 NM 38.1x 9.6x 7.0x 10.8x
148.0x 24.7x 14.1x 11.1x 14.4x

Calculation of Maximum Upside Potential


Estimated Target Peak Adj Target Plus: Equals: Calculation of
Adjusted EV/Adj Mid-cycle Peak Adj Other Less: Peak Peak Maximum
Mid-Cycle EBITDA Relative Enterprise Valuation Adjusted Equity Shares Target Upside
Companies EBITDA Multiple Multiple Value Adjustments Net Debt Value Out Price Potential
International Paper 2,753 8.00 84% 22,034 0 9,835 12,199 428.8 $28 9%
Louisiana-Pacific 465 7.00 73% 3,253 0 (73) 3,326 140.6 $24 202%
MeadWestvaco 807 8.00 84% 6,454 325 1,020 5,759 173.9 $33 36%
Plum Creek 562 20.00 209% 11,239 0 1,676 9,562 163.1 $59 59%
Rayonier 451 15.00 157% 6,766 0 591 6,175 80.7 $77 65%
Sappi (L) 1,200 7.00 73% 8,395 65 2,723 5,737 515.5 $11 172%
Temple-Inland 572 7.00 73% 4,009 90 1,126 2,973 109.2 $27 18%
Weyerhaeuser 2,033 11.00 115% 22,365 0 4,257 18,107 211.4 $86 115%
8,843 9.56 100% 84,515 480 21,157 63,838 63%

Calculation of Maximum Downside Risk


Estimated Target Trough Adj Target Plus: Equals: Calculation of Ratio of
Adjusted EV/Adj Mid-cycle Trough Adj Other Less: Trough Trough Maximum Max. Upside
Mid-Cycle EBITDA Relative Enterprise Valuation Adjusted Equity Target Downside to Maximum
Companies EBITDA Multiple Multiple Value Adjustments Net Debt Value Price Risk Downside Mu
International Paper 2,753 5.00 96% 13,757 0 9,835 3,922 $9 -65% 0.14
Louisiana-Pacific 465 1.00 19% 463 0 (73) 536 $4 -50% 4.05
MeadWestvaco 807 5.00 97% 4,039 325 1,020 3,344 $19 -21% 1.69
Plum Creek 562 10.50 203% 5,901 0 1,676 4,225 $26 -30% 1.95
Rayonier 451 8.00 154% 3,610 0 591 3,018 $37 -21% 3.12
Sappi (L) 1,200 3.00 58% 3,597 65 2,723 939 $2 -50% 3.41
Temple-Inland 572 4.00 77% 2,287 90 1,126 1,251 $11 -52% 0.34
Weyerhaeuser 2,033 6.00 116% 12,189 0 4,257 7,932 $38 -5% 23.62
8,843 5.18 100% 45,843 480 21,157 25,167 -36% 1.76

Calculation of 12-Month Targets


Estimated Target 12-Mo Adj Target Plus: Equals: Implied
Adjusted EV/Adj Mid-Cycle 12-Month Adj Other Less: Target Official 12-Month
Mid-Cycle EBITDA Relative Enterprise Valuation Adjusted Equity 12-Month Upside Target
Companies EBITDA Multiple Multiple Value Adjustments Net Debt Value Target Potential Price C
International Paper 2,753 7.2 92% 19,696 0 9,835 $9,861 $23 -10% $23.00
Louisiana-Pacific 465 4.1 53% 1,896 0 (73) $1,969 $14 76% $14.00
MeadWestvaco 807 7.1 92% 5,737 325 1,020 $5,043 $29 20% $29.00
Plum Creek 562 15.8 203% 8,853 0 1,676 $7,177 $44 18% $44.00
Rayonier 451 10.8 139% 4,869 0 591 $4,278 $53 13% $53.00
Sappi (L) 1,200 3.9 51% 4,722 65 2,723 $2,064 $4.00 -1% $4.00
Temple-Inland 572 6.4 82% 3,656 90 1,126 $2,621 $24 5% $24.00
Weyerhaeuser (K) 2,033 9.4 121% 19,053 0 4,257 $14,795 $70 75% $70.00
8,843 7.7 100% 68,483 480 21,157 47,807 22%

A) Net Debt defined as: LTD + Current Portion of LTD + STD + F) SPP: Underfunded Pension and OPEB Liability are included in Net Debt.
Preferred Equity - Cash G) Adjustments reflect off b/s financing of $294 MM for a sale/leaseback.
B) Adjusted Net Debt defined as: Net Debt+Underfunded Pension H) SSCC other adj. reflect $391 MM for off-balance sheet financing.
+OPEB Liability + Total Other Adjustments. I) TIN other adj. reflect $78 MM for off balance sheet guarantees.
C) ABH net debt includes a $693 MM add back from mark to market debt reduction. J) See next page for other valuation adjustments for WY.
D) IP other adj. reflect estimated $327 MM of off balance sheet debt related to QSPE's K) WY net debt includes debt and cash from WY real estate business (WRECO).
E) $296 MM valuation improvement related to future timberland sales not included L) SPP reflects calendar year results.
as a net debt adjustment.

Source: Company Reports and Barclays Capital Estimates Note: See DCF summary on next page for explanations of all net debt adjustments.

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Equity Research

Analyst Certification:
I, Peter Ruschmeier, hereby certify (1) that the views expressed in this research report accurately reflect my personal views about any or all
of the subject securities or issuers referred to in this research report and (2) no part of my compensation was, is or will be directly or indirectly
related to the specific recommendations or views expressed in this research report.

Other Team Members:


Lee, Kenneth (BCI, New York) 1.212.526.1291 kenneth.lee1@barcap.com
Mallela, Chethan (BCI, New York) 1.212.526.1191 chethan.mallela@barcap.com

On September 20, 2008, Barclays Capital acquired Lehman Brothers' North American investment banking, capital markets, and private investment
management businesses. All ratings and price targets prior to this date relate to coverage under Lehman Brothers Inc.

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Equity Research

Important Disclosures:
Louisiana-Pacific Corp. (LPX) US$ 7.96 (16-Jun-2010) 1-Overweight / 1-Positive
Rating and Price Target Chart:
LOUISIANA-PACIFIC CORP.
As of 14-Jun-2010
Currency = USD
28.00

26.00

24.00

22.00

20.00

18.00

16.00

14.00

12.00

10.00

8.00

6.00

4.00

2.00

0.00
6-07 9-07 12-07 3-08 6-08 9-08 12-08 3-09 6-09 9-09 12-09 3-10 6-10
Closing Price Price Target
Recommendation Change Drop Coverage
Source: FactSet
Currency=US$
Date Closing Price Rating Price Target Date Closing Price Rating Price Target
22-Jan-10 7.46 9.00 07-May-08 11.41 16.00
20-Oct-09 6.70 8.00 18-Apr-08 11.17 15.00
22-Sep-09 7.50 7.00 06-Feb-08 12.92 18.00
05-Aug-09 5.88 7.50 23-Jan-08 13.79 19.00
03-Mar-09 1.26 6.75 30-Oct-07 17.03 23.00
26-Jan-09 2.01 8.00 16-Oct-07 17.08 25.00
05-Nov-08 3.46 11.00 26-Jul-07 18.26 26.00
21-Oct-08 3.97 12.00 16-Jul-07 19.24 25.00
04-Sep-08 10.36 14.00
18-Jul-08 9.04 13.00
FOR EXPLANATIONS OF RATINGS REFER TO THE STOCK RATING KEYS LOCATED ON THE PAGE FOLLOWING THE LAST PRICE CHART.
Barclays Bank PLC and/or an affiliate trades regularly in the shares of Louisiana-Pacific Corp..
Risks Which May Impede the Achievement of the Price Target: Operating risk to oriented strandboard, engineered wood, and
composite wood markets. Extreme volatility of oriented strandboard pricing; sensitivity to interest rates, housing starts, and the home repair
and remodeling market.

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Equity Research

Important Disclosures Continued:


Plum Creek Timber (PCL) US$ 37.18 (16-Jun-2010) 1-Overweight / 1-Positive
Rating and Price Target Chart:
PLUM CREEK TIMBER COMPANY INC.
As of 14-Jun-2010
Currency = USD
58.00
56.00
54.00
52.00
50.00
48.00
46.00
44.00
42.00
40.00
38.00
36.00
34.00
32.00
30.00
28.00
26.00
24.00
22.00
6-07 9-07 12-07 3-08 6-08 9-08 12-08 3-09 6-09 9-09 12-09 3-10 6-10
Closing Price Price Target
Recommendation Change Drop Coverage
Source: FactSet
Currency=US$
Date Closing Price Rating Price Target Date Closing Price Rating Price Target
03-Feb-09 31.65 40.00 29-Apr-08 40.97 54.00
26-Jan-09 30.74 42.00 29-Jan-08 41.64 53.00
28-Oct-08 38.28 47.00 23-Jan-08 43.57 54.00
21-Oct-08 37.99 50.00 23-Jan-08 43.57 1 -Overweight
18-Jul-08 46.07 56.00 16-Jul-07 43.09 46.00
30-May-08 46.65 55.00
FOR EXPLANATIONS OF RATINGS REFER TO THE STOCK RATING KEYS LOCATED ON THE PAGE FOLLOWING THE LAST PRICE CHART.
Barclays Bank PLC and/or an affiliate is a market-maker and/or liquidity provider in securities issued by Plum Creek Timber or one of its
affiliates.
Barclays Bank PLC and/or an affiliate trades regularly in the shares of Plum Creek Timber.
Barclays Bank PLC is associated with specialist firm Barclays Capital Market Makers, which makes a market in Plum Creek Timber stock.
At any given time, the associated specialist may have "long" or "short" inventory position in the stock; and the associated specialist may be
on the opposite side of orders executed on the Floor of the Exchange in the stock.
Risks Which May Impede the Achievement of the Price Target: Plum Creek Timber's financial results can be materially affected by
changes in the supply and demand for timber. Timber prices could be adversely affected during periods of contraction in U.S. paper & forest
product production. Although PCL's timberland portfolio is large and geographically diverse, PCL's harvest volumes can be affected by
weather and environmental conditions, including forest fires, wet/muddy conditions, and changes in environmental legislation.

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Equity Research

Important Disclosures Continued:


Rayonier Inc. (RYN) US$ 46.70 (16-Jun-2010) 1-Overweight / 1-Positive
Rating and Price Target Chart:
RAYONIER INC. REIT
As of 14-Jun-2010
Currency = USD
56.00
54.00
52.00
50.00
48.00
46.00
44.00
42.00
40.00
38.00
36.00
34.00
32.00
30.00
28.00
26.00
24.00
22.00
20.00
6-07 9-07 12-07 3-08 6-08 9-08 12-08 3-09 6-09 9-09 12-09 3-10 6-10
Closing Price Price Target
Recommendation Change Drop Coverage
Source: FactSet
Currency=US$
Date Closing Price Rating Price Target Date Closing Price Rating Price Target
22-Jan-10 43.31 49.00 26-Jan-09 28.89 43.00
28-Oct-09 39.76 48.00 21-Oct-08 33.97 48.00
20-Oct-09 42.46 49.00 23-Jul-08 47.35 54.00
03-Aug-09 39.93 44.00 25-Jan-08 41.55 53.00
21-Apr-09 36.28 43.00 18-Sep-07 47.49 54.00
28-Jan-09 32.18 42.00
FOR EXPLANATIONS OF RATINGS REFER TO THE STOCK RATING KEYS LOCATED ON THE PAGE FOLLOWING THE LAST PRICE CHART.
Barclays Bank PLC and/or an affiliate is a market-maker and/or liquidity provider in securities issued by Rayonier Inc. or one of its affiliates.
Barclays Bank PLC and/or an affiliate trades regularly in the shares of Rayonier Inc..
Barclays Bank PLC is associated with specialist firm Barclays Capital Market Makers, which makes a market in Rayonier Inc. stock. At any
given time, the associated specialist may have "long" or "short" inventory position in the stock; and the associated specialist may be on the
opposite side of orders executed on the Floor of the Exchange in the stock.
Risks Which May Impede the Achievement of the Price Target: Rayonier's financial results can be materially affected by changes in the
supply and demand for timber. Timber prices could be adversely affected during periods of contraction in U.S. paper and forest product
production. Rayonier's harvest volumes can be affected by weather and environmental conditions, including forest fires, wet/muddy
conditions, and changes in environmental legislation.

9
Equity Research

Important Disclosures Continued:


Weyerhaeuser Co. (WY) US$ 39.95 (16-Jun-2010) 1-Overweight / 1-Positive
Rating and Price Target Chart:
WEYERHAEUSER CO.
As of 14-Jun-2010
Currency = USD

104.00

96.00

88.00

80.00

72.00

64.00

56.00

48.00

40.00

32.00

24.00

16.00

6-07 9-07 12-07 3-08 6-08 9-08 12-08 3-09 6-09 9-09 12-09 3-10 6-10
Closing Price Price Target
Recommendation Change Drop Coverage
Source: FactSet
Currency=US$
Date Closing Price Rating Price Target Date Closing Price Rating Price Target
16-Dec-09 43.99 70.00 21-Oct-08 40.86 81.00
20-Oct-09 40.66 55.00 18-Apr-08 64.21 90.00
14-Aug-09 35.96 51.00 11-Feb-08 63.88 104.00
03-Aug-09 36.52 53.00 23-Jan-08 65.12 101.00
09-Feb-09 28.67 51.00 16-Oct-07 70.64 105.00
26-Jan-09 28.06 56.00
03-Nov-08 36.90 82.00
FOR EXPLANATIONS OF RATINGS REFER TO THE STOCK RATING KEYS LOCATED ON THE PAGE FOLLOWING THE LAST PRICE CHART.
Barclays Bank PLC and/or an affiliate is a market-maker and/or liquidity provider in securities issued by Weyerhaeuser Co. or one of its
affiliates.
Barclays Bank PLC and/or an affiliate trades regularly in the shares of Weyerhaeuser Co..
Barclays Bank PLC and/or an affiliate has received non-investment banking related compensation from Weyerhaeuser Co. within the past
12 months.
Weyerhaeuser Co. is or during the last 12 months has been a non-investment banking client (securities related services) of Barclays Bank
PLC and/or an affiliate.
Risks Which May Impede the Achievement of the Price Target: Market risks include exposure to timber, lumber, plywood, OSB, and
pulp markets; availability and cost of raw materials including wastepaper, and sawtimber; changes in energy costs; and interest rate
sensitivity. Legal risks are related to alder log antitrust lawsuits.

10
Equity Research

FOR CURRENT IMPORTANT DISCLOSURES REGARDING COMPANIES THAT ARE


THE SUBJECT OF THIS RESEARCH REPORT, PLEASE SEND A WRITTEN REQUEST TO:
BARCLAYS CAPITAL RESEARCH COMPLIANCE
745 SEVENTH AVENUE, 17TH FLOOR, NEW YORK, NY 10019
OR
REFER TO publicresearch.barcap.com or call 1-212-526-1072

Important Disclosures Continued:


The analysts responsible for preparing this report have received compensation based upon various factors including the firm's total
revenues, a portion of which is generated by investment banking activities.

Mentioned Company Ticker Price Price Date Stock / Sector Rating


Louisiana-Pacific Corp. LPX US$ 7.96 16 Jun 2010 1-Overweight / 1-Positive
Plum Creek Timber PCL US$ 37.18 16 Jun 2010 1-Overweight / 1-Positive
Rayonier Inc. RYN US$ 46.70 16 Jun 2010 1-Overweight / 1-Positive
Weyerhaeuser Co. WY US$ 39.95 16 Jun 2010 1-Overweight / 1-Positive

Barclays Capital produces a variety of research products including, but not limited to, fundamental analysis, equity-linked analysis, quantitative
analysis, and trade ideas. Recommendations contained in one type of research product may differ from recommendations contained in other types
of research products, whether as a result of differing time horizons, methodologies, or otherwise.
Guide to the Barclays Capital Fundamental Equity Research Rating System:
Our coverage analysts use a relative rating system in which they rate stocks as 1-Overweight, 2-Equal Weight or 3-Underweight (see
definitions below) relative to other companies covered by the analyst or a team of analysts that are deemed to be in the same industry
sector (the “sector coverage universe”). Below is the list of companies that constitute the sector coverage universe:

International Paper (IP) Louisiana-Pacific Corp. (LPX)


MeadWestvaco (MWV) Plum Creek Timber (PCL)
Rayonier Inc. (RYN) Sappi Ltd. (SPP)
Temple-Inland Inc. (TIN) Weyerhaeuser Co. (WY)

In addition to the stock rating, we provide sector views which rate the outlook for the sector coverage universe as 1-Positive, 2-Neutral or 3-
Negative (see definitions below). A rating system using terms such as buy, hold and sell is not the equivalent of our rating system.
Investors should carefully read the entire research report including the definitions of all ratings and not infer its contents from ratings alone.

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1-Overweight - The stock is expected to outperform the unweighted expected total return of the sector coverage universe over a 12-month
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2-Equal Weight - The stock is expected to perform in line with the unweighted expected total return of the sector coverage universe over a
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Sector View
1-Positive - sector coverage universe fundamentals/valuations are improving.
2-Neutral - sector coverage universe fundamentals/valuations are steady, neither improving nor deteriorating.
3-Negative - sector coverage universe fundamentals/valuations are deteriorating.

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Equity Research

Distribution of Ratings:
Barclays Capital Equity Research has 1483 companies under coverage.
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43% have been assigned a 2-Equal Weight rating which, for purposes of mandatory regulatory disclosures, is classified as a Hold rating;
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11% have been assigned a 3-Underweight rating which, for purposes of mandatory regulatory disclosures, is classified as a Sell rating; 36%
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Barclays Capital Inc. (BCI, New York)
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Equity Research

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