Eric Cremers: Yes. I mean looking at the north on the sawlog prices, I think it did actually trend pretty close to where we see the when you lag during random lengths to where to where we came out. I think it parallels fairly close actually at least. So that really the story was for the quarter just the dynamics around heavier logs. It was really the density issue more than the indexing pricing itself.
Mark Weintraub: Yes. I mean I apologize. I meant the second quarter outlook the 6% improvement when I would have thought you would have been and positioned for a bigger increase given what happened in like inland Hemlock and et cetera over – in the lag. I apologize if I can take this offline and go through.
Wayne Wasechek: Yes. Well — yes I mean as it looks for the outlook where we head into Q2. I think there is again you get the seasonal lighter log mix. There is an improvement. But I think the other consideration is there is the lag there. But you also have to think about where spring breakup is and there’s no calling in that period as well. And so the timing lag is a bit extended. So I think that factors in.
Mark Weintraub: Okay, and then lastly on. So when is the FIA sale expected to be completed?
Wayne Wasechek: Second quarter, yes.
Mark Weintraub: Can you give us kind of more specifically within the quarter? Is that a very soon or might it be towards the end of the quarter?
Wayne Wasechek: I mean mid to later in the quarter’s expectation.
Mark Weintraub: Okay, great. And then on presumably, does that then — is that likely to put share repurchase more to the front owner given, I guess you’d given the explanation in the first quarter that you had the — the acquisition, and now the share price is lower and you’d have the money is coming in? Or I mean is the consideration of how things work with the refi, need to be kept in as a part of the equation as well. What would — how would you have us kind of understand your sentiment on priorities as that $58 million comes in?
Eric Cremers: I think that that clearly, Tom, is the moves are likely to share repurchases a little bit more forward. But you’ve got to remember, there’s a couple of other big factors that are in the back of our minds. One is the Waldo start-up. How does how does that go? Because we’ve seen some mills in the South have disasters startups and others have gone well. We expect ours to go well, but that remains a little bit of an unknown. I’d also like to see, lumber markets improve. And we’ll see how we’ll see how that goes. And then part of it is going to be what happens with the — with the refinance equation and what happens to our view on our expected borrowing costs. So there’s a couple of moving — a couple of moving pieces there. But certainly some all things equal, completing the FIA sale will derisk things for us.
Mark Weintraub: Okay. Appreciate that. Thank you.
Operator: Our next question comes from the line of Matthew McKellar from RBC Capital Markets. Please go ahead.
Matthew McKellar: Hi, good morning. Thanks for taking my questions. Firstly,…
Eric Cremers: Good morning.
Matthew McKellar: … I think last quarter you talked about modest signs of slowing and take-up of lots and Chanel Valley your guidance for 24 lots in Q2 and 130 lots for 2024, seems to imply a significant pickup in sales in the second half of the year. Can you just talk about the visibility you might have to a stronger sales in Q3 and Q4?
Wayne Wasechek: Yeah, Matt, it’s Wayne. The timing of our outlook on real estate lots is really driven off of inventory availability. So we expect to bring more lots to market in the later half of the year. We tried to really closely manage our CapEx for real estate. We don’t trying to get out over our skis and create excess inventory. So we really tried to stay just in front of demand. And yeah, our outlook for the rest of the years when we were bringing a couple sub-developments to the market and those will be completed here in the coming months. And then be available for market later this year. So that’s really — its lot availability and what we’re bringing to market and that’s what’s driving the timing.
Matthew McKellar: Great. Thanks for the detail. There. And then, I wonder if you could just provide a bit more commentary on the state of the timberlands markets for M&A. Maybe just what you’re seeing whether there have been any changes in sentiment in the markets? And what have you maybe since your last update?
Eric Cremers: Yeah. So — so I think the best way to describe it is that the market is relatively quiet right now. I would say in general, $3 to $4 billion of timberland changes hands each year and we’ll see where we wind up this year. But I think it’s going to wind up being a relatively light year. So far, the trade rags and the industry have highlighted the fact that, we’ve had four busted deals in the industry so far this year, deals that did not get done. And now I would also say that they were generally speaking, from what I know about them, they were very low quality deals. So it’s no surprise that they didn’t get done. But I do think demand for high-quality timberland remains quite high. And it’s just that right now there isn’t a lot of high-quality timberland on the market. So we’ll see how the market shakes out. But I think there’s no doubt demand is still out there.
Matthew McKellar: Great. Thanks for that. And it’s all for me and I’ll turn it back. Thanks.
Eric Cremers: Thanks.
Operator: Our next question comes from the line of Nico Piccini from Truist Securities. Please ask your question.
Nico Piccini: Hi guys. This is Nico on for Michael Roxland today. Just mean…
Eric Cremers: Good morning.
Nico Piccini: Good morning. First off, can you talk about any early indications on demand for carbon credits realizing that you’re a little ways away from actually placing in the market? And then, has that changed at all since you began pursuing forest carbon grades.
Eric Cremers: No. You know our carbon credit deal it’s going to be a voluntary project. And we’ve had the price discussions with our broker and with the party that we think is going to wind up buying them into. And we think the price stock is still in this $20 to $30 ton range and we still feel pretty good about it. Wayne, do you have anything to add to that?
Wayne Wasechek: Yeah, no. I think Qinnan. It’s more of the updates we gave in the past. We’re still on track and moving the project forward, trying to target later this year, but we’ll see now it’s a complex and we’re developing high quality credits and that takes time. And we’re also dependent on third parties that are involved in the accreditation process. So we’ll ultimately that’ll drive completion. But yeah definitely, we think there’s strong demand there.
