Boise Inc. (NYSE: BZ) today reported net income of $35.9 million or
$0.43 per diluted share for third quarter 2010 compared with net
income of $48.2 million or $0.57 per diluted share for third
quarter 2009. In conjunction with the release of financial results,
Boise Inc. also announced a special cash dividend of $0.40 per
common share, payable December 3, 2010, to shareholders of record
at the close of business on November 17, 2010. The total special
dividend payout is estimated to be $32.3 million.
Net income excluding special items was $36.6 million or $0.44
per diluted share in third quarter 2010 compared with $10.3 million
or $0.12 per diluted share in third quarter 2009. EBITDA excluding
special items was a record $110.9 million for third quarter 2010
compared with $66.2 million for third quarter 2009.
FINANCIAL HIGHLIGHTS
(in millions, except per-share data)
------- ------- -------
3Q 2010 3Q 2009 2Q 2010
------- ------- -------
Sales $ 554.1 $ 508.3 $ 521.6
Net income $ 35.9 $ 48.2 $ 13.3
Net income per diluted share $ 0.43 $ 0.57 $ 0.16
Net income excluding special items (a) $ 36.6 $ 10.3 $ 11.4
Net income excluding special items per diluted
share (a) $ 0.44 $ 0.12 $ 0.14
EBITDA (b) $ 109.8 $ 128.0 $ 70.1
EBITDA excluding special items (b) $ 110.9 $ 66.2 $ 67.0
Net total debt at quarter end (c) $ 604.0 $ 781.9 $ 657.1
(a) For reconciliation of net income to net income excluding special
items, see "Summary Notes to Consolidated Financial Statements and
Segment Information."
(b) For reconciliation of net income to EBITDA and EBITDA to EBITDA
excluding special items, see "Summary Notes to Consolidated Financial
Statements and Segment Information."
(c) For reconciliation of total debt to net total debt, see "Summary
Notes to Consolidated Financial Statements and Segment Information."
"Strong seasonal packaging volumes, improved sequential price
trends, and low maintenance costs combined to drive record third
quarter results," said Alexander Toeldte, President and Chief
Executive Officer of Boise Inc. "Our corrugated packaging business
continued to experience strong volumes, with shipments up 12% over
the prior year. Sales volumes of our premium office, label and
release, and flexible packaging products grew 11% over the prior
year period. We continued to generate strong cash flow and ended
the quarter with $184 million of cash and short-term investments.
Looking ahead to the fourth quarter, we expect continued benefit
from favorable price levels balanced by lower seasonal sales
volumes and increased maintenance costs from the annual maintenance
outage at our mill in Jackson, Alabama."
Carl Albert, Chair of the Board of Directors, added, "We are
delighted that our continued strong earnings performance and robust
cash position have given us the opportunity to return cash to
shareholders through the special dividend, while allowing us to
maintain enough capital to fund our growth initiatives.
We remain focused on creating shareholder value through well
performing operations, disciplined capital allocation, and targeted
growth.
We continue to pursue growth opportunities that combine solid
industrial logic with a reasonable price. We also intend to return
capital to our shareholders when both our performance and outlook
create the appropriate opportunities."
Sales
Total sales for third quarter 2010 were $554.1 million, up $45.8
million, or 9%, from $508.3 million for third quarter 2009 and up
$32.5 million from second quarter 2010 sales of $521.6 million.
Paper segment sales increased $22.2 million during third quarter
2010 compared with third quarter 2009 due primarily to increased
sales prices. Packaging segment sales increased $26.6 million
during third quarter 2010 compared with third quarter 2009 driven
by higher sales prices for linerboard and newsprint and increased
sales volumes for corrugated products.
Prices and Volumes
Pricing for uncoated freesheet improved in third quarter 2010
compared with third quarter 2009 and second quarter 2010. Average
net selling prices for uncoated freesheet papers increased 6%
during third quarter 2010 compared with third quarter 2009 and
increased 3% from second quarter 2010. In first quarter 2010, we
implemented a $40-per-ton price increase across most of our
uncoated freesheet grades, including cut-size office papers,
offset, and midweight opaque grades. In May 2010, we implemented a
$60-per-ton price increase across virtually all of our uncoated
office papers and printing and converting grades. Overall, uncoated
freesheet sales volumes were 318,000 tons during third quarter
2010, a decrease of 2% versus the prior year period and an increase
of 2% from second quarter 2010. Combined sales volumes of premium
office, label and release, and flexible packaging papers
represented 31% of our total third quarter 2010 uncoated freesheet
sales volumes compared with 27% during third quarter 2009. This
growth primarily displaced commodity paper products.
Corrugated container and sheet sales volumes improved 12% during
third quarter 2010 compared with third quarter 2009 and increased
3% from second quarter 2010. This increase was due primarily to
increased sales of sheets from our sheet feeder plant in Texas as
industrial markets in the area continued to improve. Corrugated
container and sheet prices increased 2% during third quarter 2010
compared with third quarter 2009 and 5% sequentially from second
quarter 2010. This was due to improved market conditions and
pass-through of increased prices for linerboard and medium.
Linerboard net selling prices to third parties increased 40% in
third quarter 2010 compared with third quarter 2009 and improved
17% sequentially from second quarter 2010. In first quarter 2010,
we implemented a $50-per-ton and a $70-per-ton price increase on
domestic linerboard sales in the eastern and western U.S.,
respectively. During the second quarter, we implemented an
additional $60-per-ton increase on domestic linerboard sales. In
August, we announced a third linerboard price increase, which we do
not expect to realize at this time. Linerboard sales volumes to
third parties were 48,000 tons during third quarter 2010, a
decrease of 37% from third quarter 2009, and decreased 11%
sequentially from second quarter 2010. This was due primarily to
improved sales volumes in our corrugated container and sheet
operations during third quarter 2010, which resulted in less
linerboard available for sales to third parties. Total linerboard
sales volumes in third quarter 2010, including linerboard utilized
internally in our corrugated container and sheet operations, were
153,000 tons, an increase of 3% compared with third quarter
2009.
Input Costs
Total fiber, energy, and chemical costs for third quarter 2010
were $226.1 million, an increase of $20.3 million, or 10%, compared
with costs of $205.8 million for third quarter 2009. The increase
was driven primarily by increased purchased pulp prices in our
Paper segment and higher consumption of fiber and energy as a
result of higher production volumes in our Packaging segment.
INPUT COST SUMMARY
(in millions)
------- ------- -------
3Q 2010 3Q 2009 2Q 2010
------- ------- -------
Fiber $ 119.1 $ 108.2 $ 117.1
Energy 52.4 41.9 48.1
Chemicals 54.6 55.7 49.9
------- ------- -------
Total $ 226.1 $ 205.8 $ 215.1
======= ======= =======
Total fiber costs during third quarter 2010 were $119.1 million,
an increase of $10.9 million, or 10%, from $108.2 million incurred
in third quarter 2009. This was due to higher purchased pulp and
recycled fiber prices in our Paper segment and increased
consumption of fiber in our Packaging segment as a result of
increased production. Fiber costs in third quarter 2010 increased
$2.0 million, or 2%, compared with $117.1 million in second quarter
2010.
Energy costs in third quarter 2010 were $52.4 million, an
increase of $10.5 million, or 25%, compared with $41.9 million in
third quarter 2009. This was driven by higher electrical rates in
our Packaging segment and increased overall consumption of energy
due to higher production volumes. These factors were offset
partially by lower natural gas prices. Energy costs in third
quarter 2010 increased $4.3 million, or 9%, from $48.1 million in
second quarter 2010 due primarily to increased electrical
rates.
Chemical costs in third quarter 2010 were $54.6 million, a
decrease of $1.1 million, or 2%, compared with $55.7 million in
third quarter 2009 due primarily to reduced consumption of higher
cost commodity chemicals. Chemical costs were up $4.7 million, or
9%, compared with $49.9 million in second quarter 2010 driven
primarily by higher prices.
Webcast and Conference Call
Boise Inc. will host a webcast and conference call on Wednesday,
November 3, 2010, at 11:00 a.m. ET, at which time we will review
the company's recent performance. To participate in the conference
call, dial 866-841-1001 (international callers should dial
832-445-1689). The webcast may be accessed through Boise's Internet
site and will be archived for one year following the call. Go to
www.BoiseInc.com and click on the link to the webcast under
Webcasts & Presentations on the Investors drop-down menu.
A replay of the conference call will be available in Webcasts
& Presentations from November 3 at 2:00 p.m. ET through
December 3 at 11:45 p.m. ET. Playback numbers are 800-642-1687 for
U.S. callers and 706-645-9291 for international callers. The
passcode is 19121119.
About Boise Inc.
Headquartered in Boise, Idaho, Boise Inc. (NYSE: BZ)
manufactures packaging products and papers including corrugated
containers, containerboard, label and release and flexible
packaging papers, imaging papers for the office and home, printing
and converting papers, newsprint, and market pulp. Our employees
are committed to delivering excellent value while managing our
businesses to sustain environmental resources for future
generations. Visit our website at www.BoiseInc.com.
Forward-Looking Statements
This news release contains statements that are "forward looking"
as defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include, without limitation, any
statement that may predict, forecast, indicate, or imply future
results, performance, or achievements. Forward-looking statements
involve risks and uncertainties, including but not limited to
economic, competitive, and technological factors outside our
control that may cause our business, strategy, or actual results to
differ materially from the forward-looking statements. Statements
regarding expected price levels for our products are considered
forward looking; accordingly, there can be no assurance that we
will be able to implement or realize all or any part of such price
increases. In addition, statements regarding our intent to return
capital to our shareholders are forward-looking statements. Our
ability to return capital to shareholders depends upon our
financial performance and other demands for our capital resources.
There is no assurance we will be able to or choose to return
capital to shareholders at any time in the future. For further
information about the risks and uncertainties associated with our
business, please refer to our filings with the Securities and
Exchange Commission. The company does not intend, and undertakes no
obligation, to update any forward-looking statements.
Boise Inc.
Consolidated Statements of Income
(unaudited, dollars and shares in thousands, except per-share data)
Three Months Ended
-------------------------------
September 30
-------------------- June 30,
2010 2009 2010
--------- --------- ---------
Sales
Trade $ 543,505 $ 498,812 $ 511,012
Related parties 10,550 9,453 10,549
--------- --------- ---------
554,055 508,265 521,561
--------- --------- ---------
Costs and expenses
Materials, labor, and other operating
expenses 412,847 401,607 419,594
Fiber costs from related parties 4,905 10,325 5,168
Depreciation, amortization, and depletion 32,457 32,916 32,267
Selling and distribution expenses 13,884 13,588 14,254
General and administrative expenses 12,594 12,813 12,569
St. Helens mill restructuring 234 1,402 (434)
Alternative fuel mixture credits, net - (59,572) -
Other (income) expense, net 148 1,710 (11)
--------- --------- ---------
477,069 414,789 483,407
--------- --------- ---------
Income from operations 76,986 93,476 38,154
--------- --------- ---------
Foreign exchange gain (loss) 386 1,597 (323)
Change in fair value of interest rate
derivatives (1) 125 (13)
Loss on extinguishment of debt - - (28)
Interest expense (16,099) (21,436) (16,165)
Interest income 105 130 61
--------- --------- ---------
(15,609) (19,584) (16,468)
--------- --------- ---------
Income before income taxes 61,377 73,892 21,686
Income tax provision (25,454) (25,737) (8,376)
--------- --------- ---------
Net income $ 35,923 $ 48,155 $ 13,310
========= ========= =========
Weighted average common shares
outstanding:
Basic 80,664 78,635 80,624
Diluted 84,082 84,241 84,093
Net income per common share:
Basic $ 0.45 $ 0.61 $ 0.17
Diluted $ 0.43 $ 0.57 $ 0.16
Segment Information
(unaudited, dollars in thousands)
Three Months Ended
-------------------------------
September 30
-------------------- June 30,
2010 2009 2010
--------- --------- ---------
Segment sales
Paper $ 388,193 $ 365,963 $ 364,199
Packaging 177,094 150,462 166,143
Intersegment eliminations and other (11,232) (8,160) (8,781)
--------- --------- ---------
$ 554,055 $ 508,265 $ 521,561
========= ========= =========
Segment income (loss)
Paper (1) $ 56,884 $ 78,272 $ 25,708
Packaging (1) 24,758 22,290 17,105
Corporate and Other (1) (4,270) (5,489) (4,982)
--------- --------- ---------
77,372 95,073 37,831
--------- --------- ---------
Change in fair value of interest rate
derivatives (1) 125 (13)
Loss on extinguishment of debt - - (28)
Interest expense (16,099) (21,436) (16,165)
Interest income 105 130 61
--------- --------- ---------
Income before income taxes $ 61,377 $ 73,892 $ 21,686
========= ========= =========
EBITDA (2)
Paper (1) $ 78,787 $ 99,443 $ 47,406
Packaging (1) 34,357 32,966 26,684
Corporate and Other (1) (3,315) (4,420) (4,020)
--------- --------- ---------
$ 109,829 $ 127,989 $ 70,070
========= ========= =========
(1) For the three months ended September 30, 2009, Segment income
(loss) was $35.4 million in the Paper segment, $2.9 million in the
Packaging segment, and ($2.8) million in the Corporate and Other
segment excluding $42.9 million of income, $19.4 million of income, and
$2.7 million of expenses relating to alternative fuel mixture credits
recognized in each segment, respectively. EBITDA excluding alternative
fuel mixture credits during the same time period was $56.5 million in
the Paper segment, $13.6 million in the Packaging segment, and
($1.7) million in the Corporate and Other segment. Alternative fuel
mixture credits are net of fees and expenses and before taxes.
(2) See Summary Notes to Consolidated Financial Statements and Segment
Information for a reconciliation of our EBITDA to net income.
Boise Inc.
Consolidated Statements of Income
(unaudited, dollars and shares in thousands, except per-share data)
Nine Months Ended
------------------------
September 30
------------------------
2010 2009
----------- -----------
Sales
Trade $ 1,540,368 $ 1,453,557
Related parties 29,353 34,360
----------- -----------
1,569,721 1,487,917
----------- -----------
Costs and expenses
Materials, labor, and other operating expenses 1,240,926 1,200,759
Fiber costs from related parties 19,904 24,961
Depreciation, amortization, and depletion 96,855 97,780
Selling and distribution expenses 41,872 41,394
General and administrative expenses 36,622 35,877
St. Helens mill restructuring (72) 6,183
Alternative fuel mixture credits, net - (134,909)
Other (income) expense, net (166) 4,383
----------- -----------
1,435,941 1,276,428
----------- -----------
Income from operations 133,780 211,489
----------- -----------
Foreign exchange gain (loss) 750 2,076
Change in fair value of interest rate derivatives (43) 620
Loss on extinguishment of debt (22,225) -
Interest expense (48,709) (64,979)
Interest income 203 275
----------- -----------
(70,024) (62,008)
----------- -----------
Income before income taxes 63,756 149,481
Income tax provision (27,208) (51,359)
----------- -----------
Net income $ 36,548 $ 98,122
=========== ===========
Weighted average common shares outstanding:
Basic 80,366 78,093
Diluted 84,123 82,693
Net income per common share:
Basic $ 0.45 $ 1.26
Diluted $ 0.43 $ 1.19
Segment Information
(unaudited, dollars in thousands)
Nine Months Ended
------------------------
September 30
------------------------
2010 2009
----------- -----------
Segment sales
Paper $ 1,105,881 $ 1,074,359
Packaging 491,391 437,831
Intersegment eliminations and other (27,551) (24,273)
----------- -----------
$ 1,569,721 $ 1,487,917
=========== ===========
Segment income (loss)
Paper (1) $ 112,535 $ 187,553
Packaging (1) 36,093 43,745
Corporate and Other (1) (14,098) (17,733)
----------- -----------
134,530 213,565
----------- -----------
Change in fair value of interest rate derivatives (43) 620
Loss on extinguishment of debt (22,225) -
Interest expense (48,709) (64,979)
Interest income 203 275
----------- -----------
Income before income taxes $ 63,756 $ 149,481
=========== ===========
EBITDA (3)
Paper (1) $ 177,605 $ 251,169
Packaging (1) 64,967 74,855
Corporate and Other (1) (2) (33,412) (14,679)
----------- -----------
$ 209,160 $ 311,345
=========== ===========
(1) For the nine months ended September 30, 2009, Segment income (loss)
was $87.7 million in the Paper segment, $4.4 million in the Packaging
segment and ($13.4) million in the Corporate and Other segment
excluding $99.9 million of income, $39.3 million of income and
$4.3 million of expenses relating to alternative fuel mixture credits
recognized in each segment, respectively. EBITDA excluding alternative
fuel mixture credits during the same time period was $151.3 million in
the Paper segment, $35.5 million in the Packaging segment and ($10.4)
million in the Corporate and Other segment. Alternative fuel mixture
credits are net of fees and expenses and before taxes.
(2) The nine months ended September 30, 2010, included $22.2 million of
loss on extinguishment of debt.
(3) See Summary Notes to Consolidated Financial Statements and Segment
Information for a reconciliation of our EBITDA to net income.
Boise Inc.
Consolidated Balance Sheets
(unaudited, dollars in thousands)
September 30, December 31,
2010 2009
-------------- --------------
ASSETS
Current
Cash and cash equivalents $ 173,449 $ 69,393
Short-term investments 10,614 10,023
Receivables
Trade, less allowances of $529 and $839 223,153 185,110
Related parties 1,020 2,056
Other (1) 3,779 62,410
Inventories 254,790 252,173
Deferred income taxes 13,524 -
Prepaid and other 8,463 4,819
-------------- --------------
688,792 585,984
-------------- --------------
Property
Property and equipment, net 1,187,520 1,205,679
Fiber farms and deposits 17,850 17,094
-------------- --------------
1,205,370 1,222,773
-------------- --------------
Deferred financing costs 31,757 47,369
Intangible assets, net 30,293 32,358
Other assets 7,890 7,306
-------------- --------------
Total assets $ 1,964,102 $ 1,895,790
============== ==============
(1) December 31, 2009, included a $56.6 million receivable for
alternative fuel mixture credits. This amount was collected during
first quarter 2010.
Boise Inc.
Consolidated Balance Sheets (continued)
(unaudited, dollars and shares in thousands, except per-share data)
September 30, December 31,
2010 2009
------------- -------------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Current portion of long-term debt $ 37,500 $ 30,711
Income taxes payable 24 240
Accounts payable
Trade 186,697 172,518
Related parties 274 2,598
Accrued liabilities
Compensation and benefits 55,964 67,948
Interest payable 24,069 4,946
Other 22,121 23,735
------------- -------------
326,649 302,696
------------- -------------
Debt
Long-term debt, less current portion 750,581 785,216
------------- -------------
Other
Deferred income taxes 70,862 32,253
Compensation and benefits 112,184 123,889
Other long-term liabilities 43,684 30,801
------------- -------------
226,730 186,943
------------- -------------
Commitments and contingent liabilities
Stockholders' equity
Preferred stock, $.0001 par value per share:
1,000 shares authorized; none issued - -
Common stock, $.0001 par value per share:
250,000 shares authorized; 84,760 shares
and 84,419 shares issued and outstanding 8 8
Additional paid-in capital 579,996 578,669
Accumulated other comprehensive income
(loss) (70,221) (71,553)
Retained earnings 150,359 113,811
------------- -------------
Total stockholders' equity 660,142 620,935
------------- -------------
Total liabilities and stockholders' equity $ 1,964,102 $ 1,895,790
============= =============
Boise Inc.
Consolidated Statements of Cash Flows
(unaudited, dollars in thousands)
Nine Months Ended
September 30
------------------------
2010 2009
----------- -----------
Cash provided by (used for) operations
Net income $ 36,548 $ 98,122
Items in net income not using (providing) cash
Depreciation, depletion, and amortization
of deferred financing costs and other 102,856 107,471
Share-based compensation expense 2,774 2,631
Notes payable interest expense - 8,182
Pension and other postretirement benefit
expense 7,309 6,605
Deferred income taxes 27,196 42,667
Change in fair value of energy derivatives 1,502 (4,902)
Change in fair value of interest rate
derivatives 43 (620)
(Gain) loss on sales of assets, net 82 395
Other (750) (2,076)
Loss on extinguishment of debt 22,225 -
Decrease (increase) in working capital, net of
acquisitions
Receivables 21,725 1,628
Inventories (4,802) 79,004
Prepaid expenses 3,655 (462)
Accounts payable and accrued liabilities 13,605 18,436
Current and deferred income taxes (543) 7,991
Pension and other postretirement benefit payments (18,509) (7,204)
Other 374 1,779
----------- -----------
Cash provided by (used for) operations 215,290 359,647
----------- -----------
Cash provided by (used for) investment
Acquisitions of businesses and facilities - (543)
Expenditures for property and equipment (66,697) (53,562)
Purchases of short-term investments (17,675) (13,792)
Maturities of short-term investments 17,090 3,774
Sales of assets 646 639
Other 1,689 1,621
----------- -----------
Cash provided by (used for) investment (64,947) (61,863)
----------- -----------
Cash provided by (used for) financing
Issuances of long-term debt 300,000 10,000
Payments of long-term debt (327,846) (92,698)
Payments of short-term borrowings (5,288) -
Payments of deferred financing fees (11,861) -
Other (1,292) -
----------- -----------
Cash provided by (used for) financing (46,287) (82,698)
----------- -----------
Increase in cash and cash equivalents 104,056 215,086
Balance at beginning of the period 69,393 22,518
----------- -----------
Balance at end of the period $ 173,449 $ 237,604
=========== ===========
Summary Notes to Consolidated Financial Statements and Segment
Information
The Consolidated Statements of Income, Consolidated Balance
Sheets, Consolidated Statements of Cash Flows, and Segment
Information do not include all Notes to Consolidated Financial
Statements and should be read in conjunction with the Company's
2009 Annual Report on Form 10-K and the Company's Quarterly Report
on Form 10-Q for the period ended September 30, 2010, as well as
other reports the Company files with the SEC. Net income for all
periods presented involved estimates and accruals.
Boise Inc. operates its business in three reportable segments:
Paper, Packaging, and Corporate and Other (support services). Boise
Inc. manufactures and sells a range of papers, including
communication-based papers, packaging demand-driven papers, and
market pulp. Boise Inc. also manufactures and sells corrugated
containers and sheets as well as linerboard and newsprint.
This release contains several financial measures that are not
measures under U.S. generally accepted accounting principles
(GAAP). These measures include EBITDA, EBITDA excluding special
items, net income excluding special items, net total debt, and
other similar measures. Management uses these measures to evaluate
ongoing operations and believes they are useful to investors
because they enable them to perform meaningful comparisons of past
and present operating results. The following charts reconcile these
non-GAAP measures with the most directly comparable GAAP
measures.
EBITDA represents income before interest (change in fair value
of interest rate derivatives, interest expense, and interest
income), income taxes, and depreciation, amortization, and
depletion. The following table reconciles net income to EBITDA for
the three months ended September 30, 2010 and 2009, and the three
months ended June 30, 2010 (unaudited, dollars in thousands):
Three Months Ended
-------------------------------
September 30
-------------------- June 30,
2010 2009 2010
--------- --------- ---------
Net income $ 35,923 $ 48,155 $ 13,310
Change in fair value of interest rate
derivatives 1 (125) 13
Interest expense 16,099 21,436 16,165
Interest income (105) (130) (61)
Income tax provision 25,454 25,737 8,376
Depreciation, amortization, and depletion 32,457 32,916 32,267
--------- --------- ---------
EBITDA $ 109,829 $ 127,989 $ 70,070
========= ========= =========
The following table reconciles net income to EBITDA for the nine
months ended September 30, 2010 and 2009 (unaudited, dollars in
thousands):
Nine Months Ended
--------------------
September 30
--------------------
2010 2009
--------- ---------
Net income $ 36,548 $ 98,122
Change in fair value of interest rate derivatives 43 (620)
Interest expense 48,709 64,979
Interest income (203) (275)
Income tax provision 27,208 51,359
Depreciation, amortization, and depletion 96,855 97,780
--------- ---------
EBITDA $ 209,160 $ 311,345
========= =========
The following table reconciles segment income (loss) and EBITDA
to EBITDA excluding special items for the three months ended
September 30, 2010 and 2009, and the three months ended June 30,
2010 (unaudited, dollars in thousands):
Three Months Ended
-------------------------------
September 30
-------------------- June 30,
2010 2009 2010
--------- --------- ---------
Paper
Segment income $ 56,884 $ 78,272 $ 25,708
Depreciation, amortization, and depletion 21,903 21,171 21,698
--------- --------- ---------
EBITDA $ 78,787 $ 99,443 $ 47,406
--------- --------- ---------
St. Helens mill restructuring 234 1,402 (434)
Change in fair value of energy hedges 742 (2,919) (2,312)
Alternative fuel mixture credits, net - (42,894) -
--------- --------- ---------
EBITDA excluding special items $ 79,763 $ 55,032 $ 44,660
--------- --------- ---------
Packaging
Segment income $ 24,758 $ 22,290 $ 17,105
Depreciation, amortization, and depletion 9,599 10,676 9,579
--------- --------- ---------
EBITDA $ 34,357 $ 32,966 $ 26,684
--------- --------- ---------
Change in fair value of energy hedges 143 (705) (401)
Alternative fuel mixture credits, net - (19,389) -
--------- --------- ---------
EBITDA excluding special items $ 34,500 $ 12,872 $ 26,283
--------- --------- ---------
Corporate and Other
Segment loss $ (4,270) $ (5,489) $ (4,982)
Depreciation, amortization, and depletion 955 1,069 990
Loss on extinguishment of debt - - (28)
--------- --------- ---------
EBITDA $ (3,315) $ (4,420) $ (4,020)
--------- --------- ---------
Alternative fuel mixture credits, net - 2,711 -
Loss on extinguishment of debt - - 28
--------- --------- ---------
EBITDA excluding special items $ (3,315) $ (1,709) $ (3,992)
--------- --------- ---------
--------- --------- ---------
EBITDA $ 109,829 $ 127,989 $ 70,070
========= ========= =========
--------- --------- ---------
EBITDA excluding special items $ 110,948 $ 66,195 $ 66,951
========= ========= =========
The following table reconciles segment income (loss) and EBITDA
to EBITDA excluding special items for the nine months ended
September 30, 2010 and 2009 (unaudited, dollars in thousands):
Nine Months Ended
September 30
------------------------
2010 2009
----------- -----------
Paper
Segment income $ 112,535 $ 187,553
Depreciation, amortization, and depletion 65,070 63,616
----------- -----------
EBITDA $ 177,605 $ 251,169
----------- -----------
St. Helens mill restructuring (72) 6,183
Change in fair value of energy hedges 1,263 (3,913)
Alternative fuel mixture credits, net - (99,861)
----------- -----------
EBITDA excluding special items $ 178,796 $ 153,578
----------- -----------
Packaging
Segment income $ 36,093 $ 43,745
Depreciation, amortization, and depletion 28,874 31,110
----------- -----------
EBITDA $ 64,967 $ 74,855
----------- -----------
Change in fair value of energy hedges 239 (988)
Alternative fuel mixture credits, net - (39,336)
----------- -----------
EBITDA excluding special items $ 65,206 $ 34,531
----------- -----------
Corporate and Other
Segment loss $ (14,098) $ (17,733)
Depreciation, amortization, and depletion 2,911 3,054
Loss on extinguishment of debt (22,225) -
----------- -----------
EBITDA $ (33,412) $ (14,679)
----------- -----------
Alternative fuel mixture credits, net - 4,288
Loss on extinguishment of debt 22,225 -
----------- -----------
EBITDA excluding special items $ (11,187) $ (10,391)
----------- -----------
----------- -----------
EBITDA $ 209,160 $ 311,345
=========== ===========
----------- -----------
EBITDA excluding special items $ 232,815 $ 177,718
=========== ===========
The following tables reconcile net income to net income
excluding special items and presents net income excluding special
items per diluted share for the three months ended September 30,
2010 and 2009, the three months ended June 30, 2010, and the nine
months ended September 30, 2010 and 2009 (unaudited, dollars and
shares in thousands):
Three Months Ended
-------------------------------
September 30
-------------------- June 30,
2010 2009 2010
--------- --------- ---------
Net income $ 35,923 $ 48,155 $ 13,310
St. Helens mill restructuring 234 1,402 (434)
Change in fair value of energy hedges 885 (3,624) (2,713)
Alternative fuel mixture credits, net - (59,572) -
Loss on extinguishment of debt - - 28
Tax impact of special items (a) (433) 23,914 1,207
--------- --------- ---------
Net income excluding special items $ 36,609 $ 10,275 $ 11,398
========= ========= =========
Weighted average common shares
outstanding: diluted 84,082 84,241 84,093
Net income excluding special items per
diluted share $ 0.44 $ 0.12 $ 0.14
Nine Months Ended
--------------------
September 30
--------------------
2010 2009
--------- ---------
Net income $ 36,548 $ 98,122
St. Helens mill restructuring (72) 6,183
Change in fair value of energy hedges 1,502 (4,901)
Alternative fuel mixture credits, net - (134,909)
Loss on extinguishment of debt 22,225 -
Tax impact of special items (a) (9,154) 51,714
--------- ---------
Net income excluding special items $ 51,049 $ 16,209
========= =========
Weighted average common shares
outstanding: diluted 84,123 82,693
Net income excluding special items per
diluted share $ 0.61 $ 0.20
(a) Special items are tax effected in the aggregate at an assumed combined
federal and state statutory rate of 38.7%.
The following table reconciles total debt to net total debt as
of September 30, 2010 and 2009, and June 30, 2010 (unaudited,
dollars in thousands):
September 30,
-------------------- June 30,
2010 2009 2010
--------- --------- ---------
Short-term borrowings $ - $ - $ 3,536
Current portion of long-term debt 37,500 22,235 29,163
Long-term debt, less current portion 750,581 932,517 763,081
Notes payable - 74,788 -
--------- --------- ---------
Total debt 788,081 1,029,540 795,780
Less cash and cash equivalents and
short-term investments (184,063) (247,614) (138,668)
--------- --------- ---------
Net total debt $ 604,018 $ 781,926 $ 657,112
========= ========= =========
MEDIA CONTACT: Virginia Aulin Boise Inc. 208 384 7836 INVESTOR
CONTACT: Jason Bowman Boise Inc. 208 384 7456
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