Weyerhaeuser (WY) announced its plan to invest approximately $500M to build a new TimberStrand facility near Monticello and Warren, Arkansas, expanding the company’s engineered wood products, or EWP, capacity in the U.S. South. The facility will have an annual production capacity of approximately 10M cubic feet, which is comparable to the company’s existing TimberStrand facility in Kenora, Ontario. Construction is expected to begin in 2025, with the goal of starting operations in 2027. The new facility will support an underserved and growing market for TimberStrand in the U.S. South. Additionally, the plant will include a biomass-fueled cogeneration system, which will fully supply the plant’s electrical needs and reduce its environmental footprint. The facility doubles Weyerhaeuser’s North American TimberStrand capacity. The facility is expected to generate over $100M of annual adjusted EBITDA at full operating capacity and expected to add nearly 200 jobs in Monticello and the surrounding area once fully operational. The company expects to incur approximately $500M of capital expenditures for the facility through 2027 and plans to exclude this investment for purposes of calculating the company’s annual adjusted funds available for distribution, as used in its cash return framework. This capital outlay may be sourced from cash on hand or through future financing, as the company deems appropriate.
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