BOISE, Idaho - Boise Inc. (NYSE: BZ) today
reported net income of $13.5 million, or $0.13 per diluted share,
for fourth quarter 2012, compared with net income of $16.3 million,
or $0.15 per diluted share, for fourth quarter 2011. Net income for
the year ended 2012 was $52.2 million, or $0.52 per diluted share,
compared with $75.2 million, or $0.70 per diluted share, for the
year ended 2011. Net income excluding special items for the year
ended 2012 was $71.6 million, compared with $79.9 million for the
year ended 2011.
EBITDA excluding special items (1) was $78.7
million for fourth quarter 2012, compared with EBITDA excluding
special items of $85.0 million for fourth quarter 2011. EBITDA
excluding special items was $331.8 million for the year ended 2012,
versus our record 2011 EBITDA excluding special items of $340.2
million.
2012 Highlights
-Record annual sales of $2.56 billion, a 6%
increase over 2011
-EBITDA excluding special items of $331.8 million for 2012 and
$78.7 million for 4Q 2012 (1)
-Special items include pretax costs of $31.7 million, primarily
related to ceasing uncoated freesheet production at our paper mill
in St. Helens, Oregon
-Generated annual free cash flow of $97.4 million (1)
-Paid two special cash dividends totaling $1.20 per common share,
or $119.7 million
"We were pleased with our overall 2012 operating
results," said Alexander Toeldte, president and chief executive
officer of Boise Inc. "Our mills and converting operations ran
well, and we reduced costs through productivity improvement by
reducing usage of key raw materials. During the year, we generated
significant free cash flow and returned capital to our shareholders
through the payment of two special cash dividends totaling $1.20
per common share. Despite these achievements, our 2012 results were
affected adversely by margin compression in some of our Packaging
operations and declining prices in our Paper business."
"In Packaging, we experienced margin compression
in some of our converting operations, primarily in our California
and Texas markets. We saw little benefit from the announced $50 per
ton linerboard price increase during the fourth quarter in our
converting operations, but we expect to more fully benefit from the
increase in first quarter 2013. As of January 31, 2013, we
had implemented over 90% of the $50 price increase through our
converting operations. We are making targeted capital investments
in our converting operations to improve efficiency and keep pace
with our sales growth."
"In Paper, we faced declining prices for
communication-grade papers throughout the year, particularly in the
fourth quarter. The average price for uncoated freesheet in the
fourth quarter 2012 declined $27 per ton from the previous quarter
and dropped $45 per ton from the fourth quarter 2011, as industry
supply continued to outpace demand. These dynamics factored heavily
into our decision to cease paper production at our mill in St.
Helens, Oregon, reducing our production capacity in 2013 by 60,000
tons. During fourth quarter, we took 16,000 tons of market-related
downtime in addition to the 8,000 tons of downtime from our annual
maintenance outage at our mill in Jackson, Alabama. Going forward,
we will continue to aggressively manage our costs and evaluate the
optimal configuration of our white paper assets, to balance our
production with demand for our products."
Quarterly and Annual Financial
Results |
|
|
|
|
|
|
|
|
|
|
|
(in
millions, except per-share data) |
|
4Q 2012 |
|
4Q 2011 |
|
3Q 2012 |
|
2012 |
|
2011 |
Sales |
$627.5 |
|
$600.4 |
|
$645.2 |
|
$2,555.4 |
|
$2,404.1 |
Net income |
$13.5 |
|
$16.3 |
|
$3.6 |
|
$52.2 |
|
$75.2 |
Net income per diluted share
(2) |
$0.13 |
|
$0.15 |
|
$0.04 |
|
$0.52 |
|
$0.70 |
Net income excluding special
items (1) |
$13.8 |
|
$18.5 |
|
$22.8 |
|
$71.6 |
|
$79.9 |
Net income excluding special
items per diluted share (1) |
$0.14 |
|
$0.17 |
|
$0.23 |
|
$0.71 |
|
$0.75 |
Weighted average diluted common
shares outstanding (2) |
101.2 |
|
106.6 |
|
101.0 |
|
101.1 |
|
106.7 |
EBITDA (1) |
$78.3 |
|
$81.4 |
|
$59.2 |
|
$300.0 |
|
$332.6 |
EBITDA excluding special items
(1) |
$78.7 |
|
$85.0 |
|
$90.5 |
|
$331.8 |
|
$340.2 |
(1) For reconciliations of non-GAAP measures, see
"Summary Notes to Consolidated Financial Statements and Segment
Information."
(2) As of December 31, 2012, we had 100.5 million common shares
outstanding. For additional information, see "Summary Notes to
Consolidated Financial Statements and Segment Information."
Packaging
Segment
Packaging segment sales for fourth quarter 2012
were $287.3 million, an increase of $35.9 million, or 14%, compared
with $251.4 million in fourth quarter 2011. About half of the
increase was the result of our acquisition of Hexacomb on December
1, 2011. The remaining increase resulted from sales volume growth
in our network of box plants, which increased 9% in fourth quarter
2012, compared with the same quarter in 2011. Our vertical
integration rose from an average of 71% during 2011 to 84% in 2012,
and we expect it to increase to approximately 90% in 2013 based on
our current volumes. Our increased vertical integration decreased
our sales to third parties by 46% in fourth quarter 2012, compared
with fourth quarter 2011. Net sales prices for our corrugated
products, excluding Hexacomb, increased 2% during fourth quarter
2012, compared with fourth quarter 2011. Packaging segment sales
for fourth quarter 2012 were essentially flat, compared with third
quarter 2012.
Packaging segment sales for full year 2012 were
$1,130.1 million, an increase of $180.4 million, or 19%, compared
with $949.7 million for 2011. Sales volumes of corrugated products
increased 16% in 2012, compared with 2011. Slightly more than
half of this increase related to growth from our 2011 acquisitions
and the remainder was due to increased sales from our network of
box plants, which offset the decline in linerboard net sales prices
and volumes sold to third parties during 2012 by 2% and 31%,
respectively, compared with 2011.
Packaging segment EBITDA, excluding special items,
was $47.1 million for fourth quarter 2012, a slight increase from
$46.9 million in fourth quarter 2011. Although we benefited from
two additional months of operations at Hexacomb in the quarter,
this was offset by higher input costs and margin compression on the
sale of some of our corrugated products at our converting
operations. Packaging segment EBITDA in fourth quarter 2012
increased $9.6 million, or 25%, compared with third quarter 2012,
due to improved sales prices of linerboard sold to third parties
and lower maintenance outage costs, offset partially by higher
fiber costs.
Packaging segment EBITDA, excluding special items,
for full year 2012 was $162.5 million, an increase of $3.2 million,
or 2%, compared with 2011. The increase reflects a full year impact
from our acquisitions. Our corrugated products sales volumes
increased 16% year over year; however, these increases were largely
offset by margin compression on the sale of some of our corrugated
products.
During first quarter 2013, we will conduct a cold
outage at our mill in DeRidder, Louisiana. Cold outages at this
facility occur every five years and are more extensive and costly
than our normal annual maintenance outages. We expect total
maintenance outage costs for our Packaging segment in 2013 to be
approximately $23 million, an increase of approximately $12 million
from 2012, with $20 million expected in first quarter 2013,
relative to $2 million in first quarter 2012, with the remaining $3
million expected in third quarter 2013.
Paper Segment
Lower uncoated freesheet sales prices affected our
fourth quarter 2012 sales, compared with fourth quarter 2011 and
third quarter 2012. Paper segment sales for fourth quarter 2012
were $352.7 million, a decrease of $7.0 million, or 2%, compared
with fourth quarter 2011. Paper segment sales decreased $17.3
million, or 5%, compared with third quarter 2012. Our average sales
price of uncoated freesheet declined from $993 per short ton in
fourth quarter 2011 and $975 per short ton in third quarter 2012 to
$948 per short ton in fourth quarter 2012. Total uncoated freesheet
sales volumes increased 3% versus the prior-year period but were
down 4% versus third quarter 2012 as a result of seasonal demand
decline.
Paper segment sales for full year 2012 were
$1,468.3 million, down 2% compared with 2011, due to lower sales
prices of uncoated freesheet and lower sales prices and volumes of
market pulp. Our average sales price of uncoated freesheet was $968
per short ton in 2012, down from an average of $990 per short ton
in 2011. Sales volumes of uncoated freesheet were up 2% in 2012,
compared with 2011. The increase in our uncoated freesheet sales
volumes for the year is due to a 5% increase in sales of label and
release and premium office papers and higher purchase volumes by
our cut-size customers. Combined sales volumes of label and release
and premium office papers represented 34% of our total uncoated
freesheet sales volumes for 2012, up from 33% in the prior
year.
Paper segment EBITDA, excluding special items, was
$38.7 million for fourth quarter 2012, a decrease of $5.7 million,
or 13%, compared with fourth quarter 2011. This decrease was due
primarily to lower sales prices of uncoated freesheet. This decline
was largely offset by generally lower input and maintenance outage
costs. Paper segment EBITDA, excluding special items, for fourth
quarter 2012 decreased $19.9 million from third quarter 2012 as a
result of lower sales volumes and net selling prices for uncoated
freesheet and higher maintenance outage costs as a result of our
annual outage at our Jackson, Alabama, mill.
Paper segment EBITDA, excluding special items, for
full year 2012 was $193.3 million, a decrease of $8.2 million, or
4%, compared with $201.5 million for the year ended December 31,
2011. This decrease resulted from the $22 per short ton reduction
in the average sales price of uncoated freesheet and the $107 per
short ton reduction in the average sales price of market pulp.
Additionally, chemical costs increased $13.8 million year over
year, due to higher prices and increased volumes for key chemicals
such as caustic soda and starch. These changes were offset
partially by an overall $34.0 million reduction in fiber costs as
higher wood chip prices, primarily in the Pacific Northwest, were
offset by lower purchased pulp prices and improved pulp production
at International Falls, Minnesota, and Jackson, Alabama, which
reduced our consumption of purchased pulp.
Webcast and Conference
Call
Boise Inc. will host a webcast and conference call
on Tuesday, February 26, 2013, 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). This webcast will be archived from February 26,
2013, at 2:00 p.m. ET through March 26, 2013, at 11:45 p.m. ET.
Playback numbers are 855-859-2056 for U.S. callers and 404-537-3406
for international callers. The passcode is 87424464. To access the
replay, go to www.BoiseInc.com and click on About Boise Inc. to
reach the link to the webcast under Webcasts & Presentations on
the Investors menu.
Annual Meeting
Date
Boise Inc. intends to hold its annual
shareholders' meeting at 9:00 a.m. MDT on Wednesday, April 24,
2013, in Boise, Idaho. The record date to determine shareholders
eligible to vote at the meeting is Monday, March 18, 2013.
About Boise
Inc.
Headquartered in Boise, Idaho, Boise Inc. (NYSE:
BZ) manufactures a wide variety of packaging and paper products.
Boise's range of packaging products includes linerboard and
corrugating medium, corrugated containers and sheets, and
protective packaging products. Boise's paper products include
imaging papers for the office and home, printing and converting
papers, and papers used in packaging, such as label and release
papers. 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. Statements
regarding announced price increases on our products, cost
management efforts, asset configuration changes, and vertical
integration levels and the benefits we expect to derive from such
outcomes and actions are forward looking. Given the risks and
uncertainties involved, there can be no assurance we will be able
to achieve our stated goals or realize any benefits. For example,
changes in the economy and competitive influences may result in our
being unable to implement or realize any additional benefit from
our announced price increases. Economic and competitive influences,
availability of equipment and suppliers, the performance of the
equipment once installed, and other factors could cause the outcome
of our asset configuration projects, the related costs, and the
timing to differ materially from what we have predicted in this
release. For further information about the risks and uncertainties
associated with our business, please refer to our filings with the
Securities and Exchange Commission. We undertake no
obligation to update the forward-looking statements in this release
whether as a result of new information, future events, or
otherwise.
Boise
Inc.
Segment Highlights
(dollars in millions)
|
4Q 2012 |
|
4Q 2011 |
|
3Q 2012 |
|
2012 |
|
2011 |
Packaging |
|
|
|
|
|
|
|
|
|
Sales volumes (thousands of short
tons, except corrugated) |
|
|
|
|
|
|
|
|
|
Linerboard, Total |
156.8 |
|
157.9 |
|
155.7 |
|
611.1 |
|
606.5 |
Linerboard, External sales |
31.2 |
|
57.5 |
|
36.5 |
|
158.9 |
|
230.2 |
Newsprint |
60.3 |
|
58.6 |
|
60.0 |
|
233.4 |
|
230.8 |
Corrugated containers and sheets
(mmsf) (a) |
2,578 |
|
2,297 |
|
2,584 |
|
10,079 |
|
8,720 |
Key input costs |
|
|
|
|
|
|
|
|
|
Fiber, including purchased
rollstock |
$43.4 |
|
$42.3 |
|
$39.8 |
|
$176.9 |
|
$156.9 |
Energy |
16.4 |
|
15.1 |
|
16.4 |
|
61.2 |
|
65.2 |
Chemicals |
10.9 |
|
10.0 |
|
10.6 |
|
42.0 |
|
38.0 |
Outage costs |
(0.3) |
|
- |
|
3.5 |
|
10.9 |
|
9.9 |
EBITDA (b) |
47.1 |
|
45.5 |
|
37.5 |
|
162.5 |
|
155.5 |
EBITDA excluding special items
(b) |
47.1 |
|
46.9 |
|
37.5 |
|
162.5 |
|
159.3 |
Assets |
|
|
|
|
|
|
$958.0 |
|
$957.3 |
Paper |
|
|
|
|
|
|
|
|
|
Sales volumes (thousands of short
tons) |
|
|
|
|
|
|
|
|
|
Uncoated freesheet (c) |
302.4 |
|
294.1 |
|
313.8 |
|
1,253.8 |
|
1,229.8 |
Corrugating medium |
34.9 |
|
33.9 |
|
33.7 |
|
135.3 |
|
135.3 |
Market pulp |
15.6 |
|
20.3 |
|
18.5 |
|
52.9 |
|
90.2 |
Key input costs |
|
|
|
|
|
|
|
|
|
Fiber |
$77.9 |
|
$94.1 |
|
$85.7 |
|
$343.1 |
|
$377.1 |
Energy |
34.2 |
|
36.4 |
|
33.4 |
|
134.8 |
|
143.9 |
Chemicals |
49.6 |
|
51.1 |
|
55.6 |
|
211.6 |
|
197.8 |
Outage costs |
4.6 |
|
7.8 |
|
0.4 |
|
14.8 |
|
21.5 |
EBITDA (b) |
38.2 |
|
44.4 |
|
27.3 |
|
161.6 |
|
201.5 |
EBITDA excluding special items
(b) |
38.7 |
|
44.4 |
|
58.6 |
|
193.3 |
|
201.5 |
Assets |
|
|
|
|
|
|
$1,144.7 |
|
$1,190.9 |
|
4Q 2012 vs. |
|
4Q 2012 vs. |
|
2012 vs. |
|
4Q 2011 |
|
3Q 2012 |
|
2011 |
Packaging |
|
|
|
|
|
Change in net sales prices
(dollars per short ton, except corrugated) (d) |
|
|
|
|
|
Linerboard, Total |
$45 |
|
$40 |
|
$8 |
Linerboard, External sales
only |
39 |
|
31 |
|
(7) |
Newsprint |
(1) |
|
3 |
|
(1) |
Corrugated containers and sheets
($/msf) (a) |
6 |
|
1 |
|
8 |
Paper |
|
|
|
|
|
Change in net sales prices
(dollars per short ton) (d) |
|
|
|
|
|
Uncoated freesheet (c) |
$(45) |
|
$(27) |
|
$(22) |
Corrugating medium |
77 |
|
53 |
|
28 |
Market pulp |
(12) |
|
(6) |
|
(107) |
(a) Includes corrugated container and sheet
volumes for Tharco and protective packaging product volumes for
Hexacomb since the acquisitions on March 1 and December 1, 2011,
respectively. Increase in sales price during 2012 is primarily due
to Hexacomb.
(b) For reconciliations of non-GAAP measures, see "Summary Notes to
Consolidated Financial Statements and Segment
Information."
(c) Includes cut-size office papers, printing and converting
papers, and label and release papers.
(d) Average net selling prices for our principal products represent
sales less freight costs, discounts, and allowances.
Boise
Inc.
Consolidated Statements of
Income
(dollars and shares in thousands, except per-share data)
|
Three Months Ended |
|
Year Ended |
|
December 31 |
|
September 30, |
|
December 31 |
|
2012 |
|
2011 (2) |
|
2012 |
|
2012 |
|
2011 (2) |
Sales |
|
|
|
|
|
|
|
|
|
Trade |
$611,925 |
|
$591,524 |
|
$631,054 |
|
$2,495,092 |
|
$2,364,024 |
Related parties |
15,567 |
|
8,917 |
|
14,131 |
|
60,271 |
|
40,057 |
|
627,492 |
|
600,441 |
|
645,185 |
|
2,555,363 |
|
2,404,081 |
|
|
|
|
|
|
|
|
|
|
Costs and
expenses |
|
|
|
|
|
|
|
|
|
Materials, labor, and other
operating expenses (excluding depreciation) (1) |
491,554 |
|
462,315 |
|
502,848 |
|
2,004,044 |
|
1,880,271 |
Fiber costs from related
parties |
5,094 |
|
5,154 |
|
5,266 |
|
19,772 |
|
18,763 |
Depreciation, amortization, and
depletion |
39,907 |
|
37,320 |
|
37,540 |
|
152,306 |
|
143,758 |
Selling and distribution
expenses |
30,602 |
|
28,999 |
|
30,015 |
|
121,827 |
|
107,654 |
General and administrative
expenses |
20,492 |
|
18,872 |
|
19,213 |
|
79,748 |
|
60,587 |
St. Helens charges (1) |
111 |
|
- |
|
27,448 |
|
27,559 |
|
- |
Other (income) expense, net
(3) |
982 |
|
1,860 |
|
1,509 |
|
2,572 |
|
1,994 |
|
588,742 |
|
554,520 |
|
623,839 |
|
2,407,828 |
|
2,213,027 |
|
|
|
|
|
|
|
|
|
|
Income from
operations |
38,750 |
|
45,921 |
|
21,346 |
|
147,535 |
|
191,054 |
|
|
|
|
|
|
|
|
|
|
Foreign exchange gain (loss) |
(376) |
|
430 |
|
296 |
|
179 |
|
135 |
Loss on extinguishment of debt
(4) |
- |
|
(2,300) |
|
- |
|
- |
|
(2,300) |
Interest expense |
(15,484) |
|
(15,653) |
|
(15,458) |
|
(61,740) |
|
(63,817) |
Interest income |
59 |
|
59 |
|
3 |
|
160 |
|
269 |
|
(15,801) |
|
(17,464) |
|
(15,159) |
|
(61,401) |
|
(65,713) |
|
|
|
|
|
|
|
|
|
|
Income
before income taxes |
22,949 |
|
28,457 |
|
6,187 |
|
86,134 |
|
125,341 |
Income tax provision |
(9,402) |
|
(12,202) |
|
(2,584) |
|
(33,984) |
|
(50,131) |
Net
income |
$13,547 |
|
$16,255 |
|
$3,603 |
|
$52,150 |
|
$75,210 |
|
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
100,167 |
|
103,991 |
|
100,144 |
|
99,872 |
|
101,941 |
Diluted |
101,180 |
|
106,613 |
|
101,030 |
|
101,143 |
|
106,746 |
|
|
|
|
|
|
|
|
|
|
Net income
per common share: |
|
|
|
|
|
|
|
|
|
Basic |
$0.14 |
|
$0.16 |
|
$0.04 |
|
$0.52 |
|
$0.74 |
Diluted |
$0.13 |
|
$0.15 |
|
$0.04 |
|
$0.52 |
|
$0.70 |
For footnotes, see Summary Notes to Consolidated
Financial Statements and Segment Information.
Boise
Inc.
Segment Information
(dollars in thousands)
|
Three Months Ended |
|
Year Ended |
|
December 31 |
|
September 30, |
|
December 31 |
|
2012 |
|
2011 |
|
2012 |
|
2012 |
|
2011 |
Segment sales |
|
|
|
|
|
|
|
|
|
Packaging (2) |
$287,332 |
|
$251,388 |
|
$285,705 |
|
$1,130,102 |
|
$949,710 |
Paper |
352,702 |
|
359,697 |
|
369,952 |
|
1,468,344 |
|
1,496,537 |
Intersegment eliminations and
other |
(12,542) |
|
(10,644) |
|
(10,472) |
|
(43,083) |
|
(42,166) |
|
$627,492 |
|
$600,441 |
|
$645,185 |
|
$2,555,363 |
|
$2,404,081 |
|
|
|
|
|
|
|
|
|
|
Segment income (loss) |
|
|
|
|
|
|
|
|
|
Packaging (2) (3) |
$31,630 |
|
$31,837 |
|
$22,715 |
|
$101,626 |
|
$104,996 |
Paper (1) |
14,926 |
|
21,794 |
|
5,463 |
|
73,913 |
|
112,051 |
Corporate and Other (3) |
(8,182) |
|
(7,280) |
|
(6,536) |
|
(27,825) |
|
(25,858) |
|
38,374 |
|
46,351 |
|
21,642 |
|
147,714 |
|
191,189 |
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment of debt
(4) |
- |
|
(2,300) |
|
- |
|
- |
|
(2,300) |
Interest expense |
(15,484) |
|
(15,653) |
|
(15,458) |
|
(61,740) |
|
(63,817) |
Interest income |
59 |
|
59 |
|
3 |
|
160 |
|
269 |
Income before income taxes |
$22,949 |
|
$28,457 |
|
$6,187 |
|
$86,134 |
|
$125,341 |
|
|
|
|
|
|
|
|
|
|
EBITDA (5) |
|
|
|
|
|
|
|
|
|
Packaging (2) (3) |
$47,089 |
|
$45,518 |
|
$37,538 |
|
$162,542 |
|
$155,543 |
Paper (1) |
38,244 |
|
44,390 |
|
27,275 |
|
161,563 |
|
201,533 |
Corporate and Other (3) (4) |
(7,052) |
|
(8,537) |
|
(5,631) |
|
(24,085) |
|
(24,429) |
|
$78,281 |
|
$81,371 |
|
$59,182 |
|
$300,020 |
|
$332,647 |
|
|
|
|
|
|
|
|
|
|
EBITDA excluding special items
(5) |
|
|
|
|
|
|
|
|
|
Packaging (2) (3) |
$47,089 |
|
$46,882 |
|
$37,538 |
|
$162,542 |
|
$159,334 |
Paper (1) |
38,701 |
|
44,390 |
|
58,563 |
|
193,308 |
|
201,533 |
Corporate and Other (3) (4) |
(7,052) |
|
(6,237) |
|
(5,631) |
|
(24,085) |
|
(20,626) |
|
$78,738 |
|
$85,035 |
|
$90,470 |
|
$331,765 |
|
$340,241 |
|
|
|
|
|
|
|
|
|
|
For footnotes, see Summary Notes to Consolidated
Financial Statements and Segment Information.
Boise
Inc.
Consolidated Balance
Sheets
(dollars in thousands)
|
December 31, 2012 |
|
December 31, 2011 |
ASSETS |
|
|
|
|
|
|
|
Current |
|
|
|
Cash and cash equivalents |
$49,707 |
|
$96,996 |
Receivables |
|
|
|
Trade, less allowances of $1,382
and $1,343 |
240,459 |
|
228,838 |
Other |
8,267 |
|
7,622 |
Inventories |
294,484 |
|
307,305 |
Deferred income taxes |
17,955 |
|
20,379 |
Prepaid and other |
8,828 |
|
6,944 |
|
619,700 |
|
668,084 |
|
|
|
|
Property |
|
|
|
Property and equipment, net |
1,223,001 |
|
1,235,269 |
Fiber farms |
24,311 |
|
21,193 |
|
1,247,312 |
|
1,256,462 |
|
|
|
|
Deferred
financing costs |
26,677 |
|
30,956 |
Goodwill |
160,130 |
|
161,691 |
Intangible
assets, net |
147,564 |
|
159,120 |
Other
assets |
7,029 |
|
9,757 |
Total
assets |
$2,208,412 |
|
$2,286,070 |
For footnotes, see Summary Notes to Consolidated
Financial Statements and Segment Information.
Boise
Inc.
Consolidated Balance Sheets
(continued)
(dollars and shares in thousands, except per-share data)
|
December 31, 2012 |
|
December 31, 2011 |
LIABILITIES
AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
Current |
|
|
|
Current portion of long-term
debt |
$10,000 |
|
$10,000 |
Accounts payable |
185,078 |
|
202,584 |
Accrued liabilities |
|
|
|
Compensation and benefits |
70,950 |
|
64,907 |
Interest payable |
10,516 |
|
10,528 |
Other |
20,528 |
|
22,540 |
|
297,072 |
|
310,559 |
|
|
|
|
Debt |
|
|
|
Long-term debt, less current
portion |
770,000 |
|
790,000 |
|
|
|
|
Other |
|
|
|
Deferred income taxes |
198,370 |
|
161,260 |
Compensation and benefits |
121,682 |
|
172,394 |
Other long-term liabilities |
73,102 |
|
57,010 |
|
393,154 |
|
390,664 |
|
|
|
|
Commitments
and contingent liabilities |
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
Preferred stock, $0.0001 par
value per share: 1,000 shares authorized; none issued |
- |
|
- |
Common stock, $0.0001 par value
per share: 250,000 shares authorized; 100,503 and 100,272 shares
issued and outstanding |
12 |
|
12 |
Treasury stock, 21,151 shares
held |
(121,423) |
|
(121,421) |
Additional paid-in capital |
868,840 |
|
866,901 |
Accumulated other comprehensive
income (loss) |
(101,304) |
|
(121,962) |
Retained earnings |
102,061 |
|
171,317 |
Total
stockholders' equity |
748,186 |
|
794,847 |
|
|
|
|
Total
liabilities and stockholders' equity |
$2,208,412 |
|
$2,286,070 |
For footnotes, see Summary Notes to Consolidated
Financial Statements and Segment Information.
Consolidated Statements of
Cash Flows
(dollars in thousands)
|
Year Ended December 31 |
|
2012 |
|
2011 |
Cash
provided by (used for) operations |
|
|
|
Net income |
$52,150 |
|
$75,210 |
Items in net income not using
(providing) cash |
|
|
|
Depreciation, depletion, and
amortization of deferred financing costs and other |
157,040 |
|
149,715 |
Share-based compensation
expense |
5,983 |
|
3,695 |
Pension expense |
11,279 |
|
10,916 |
Deferred income taxes |
33,684 |
|
44,301 |
St. Helens charges |
28,481 |
|
- |
Other |
1,868 |
|
1,878 |
Loss on extinguishment of debt
(4) |
- |
|
2,300 |
Decrease (increase) in working
capital, net of acquisitions |
|
|
|
Receivables |
(9,803) |
|
1,624 |
Inventories |
8,136 |
|
(22,237) |
Prepaid expenses |
(814) |
|
(275) |
Accounts payable and accrued
liabilities |
(16,505) |
|
3,803 |
Current and deferred income
taxes |
(1,938) |
|
4,632 |
Pension payments |
(35,205) |
|
(25,414) |
Other |
674 |
|
43 |
Cash provided by operations |
235,030 |
|
250,191 |
Cash provided by (used for)
investment |
|
|
|
Acquisition of businesses and
facilities, net of cash acquired (2) |
- |
|
(326,223) |
Expenditures for property and
equipment |
(137,642) |
|
(128,762) |
Purchases of short-term
investments |
- |
|
(3,494) |
Maturities of short-term
investments |
- |
|
14,114 |
Other |
1,393 |
|
1,048 |
Cash used for investment |
(136,249) |
|
(443,317) |
Cash provided by (used for)
financing |
|
|
|
Issuances of long-term debt |
5,000 |
|
275,000 |
Payments of long-term debt |
(25,000) |
|
(256,831) |
Payments of financing costs |
(188) |
|
(8,613) |
Repurchases of common stock |
(2) |
|
(121,421) |
Proceeds from exercise of
warrants |
- |
|
284,785 |
Payment of special dividends |
(119,653) |
|
(47,916) |
Tax withholdings on net
settlements of share-based awards |
(5,833) |
|
(2,775) |
Other |
(394) |
|
1,060 |
Cash provided by (used for)
financing |
(146,070) |
|
123,289 |
Decrease in cash and cash
equivalents |
(47,289) |
|
(69,837) |
Balance at beginning of the
period |
96,996 |
|
166,833 |
Balance at end of the period |
$49,707 |
|
$96,996 |
For footnotes, see Summary Notes to Consolidated
Financial Statements and Segment Information.
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 2012 Annual Report on Form 10-K, as well as other reports
the Company files with the SEC. Net income for all periods
presented involved estimates and accruals.
1. In September 2012, we committed to a plan to
cease paper production on our one remaining paper machine at our
St. Helens, Oregon, paper mill, which we shut down in December
2012. During the three months ended September 30, 2012 and the year
ended December 31, 2012, we recorded $31.3 million and $31.7
million, respectively, of pretax costs related primarily to ceasing
operations at the mill. These costs are recorded in our Paper
segment. The $31.7 million of costs for the year ended December 31,
2012, included approximately $14.2 million of noncash charges
related primarily to the impairment of property, plant and
equipment, and inventory; and approximately $17.5 million of cash
costs of which we expect to pay approximately $7.3 million of
employee-related and other costs in early 2013 and the remaining
amounts over a longer term. During the three months ended September
30, 2012 and the year ended December 31, 2012, we recorded $27.4
million and $27.6 million, respectively, in "St. Helens charges"
and $3.9 million and $4.1 million, respectively, related primarily
to inventory in Materials, labor, and other operating expenses
(excluding depreciation)" in our Consolidated Statements of
Income.
2. On March 1 and December 1, 2011, we completed
the acquisitions of Tharco Packaging (Tharco) and Hexacomb
Corporation (Hexacomb), respectively. Total cash consideration was
$326.2 million. Financial results for Tharco and Hexacomb are
included in our Packaging segment following the dates of
acquisition.
In connection with the Tharco purchase price
allocation, inventories were written up to their estimated fair
market value. As the related inventories were sold, we recognized
$2.2 million of expense in "Materials, labor, and other operating
expenses (excluding depreciation)" in our Consolidated Statement of
Income for the year ended December 31, 2011.
3. During the three months ended December 31,
2011, we recorded $1.4 million of transaction-related expenses in
the Packaging segment, and during the year ended December 31, 2011,
we recorded $1.6 million and $1.5 million of expenses in our
Packaging and Corporate and Other segments, respectively.
Transaction-related expenses include expenses associated with
transactions, whether consummated or not, and do not include
integration costs.
4. The year ended December 31, 2011, included $2.3
million of expense related to losses on the extinguishment of
debt.
5. 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, free
cash flow, 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 tables that
follow reconcile these non-GAAP measures with the most directly
comparable GAAP measures.
EBITDA represents income before interest (interest
expense and interest income), income taxes, and depreciation,
amortization, and depletion. The following table reconciles net
income to EBITDA and EBITDA to EBITDA excluding special items
(unaudited, dollars in thousands):
|
Three Months Ended |
|
Year Ended |
|
December 31 |
|
September 30, |
|
December 31 |
|
2012 |
|
2011 |
|
2012 |
|
2012 |
|
2011 |
Net income |
$13,547 |
|
$16,255 |
|
$3,603 |
|
$52,150 |
|
$75,210 |
Interest expense |
15,484 |
|
15,653 |
|
15,458 |
|
61,740 |
|
63,817 |
Interest income |
(59) |
|
(59) |
|
(3) |
|
(160) |
|
(269) |
Income tax provision |
9,402 |
|
12,202 |
|
2,584 |
|
33,984 |
|
50,131 |
Depreciation, amortization, and
depletion |
39,907 |
|
37,320 |
|
37,540 |
|
152,306 |
|
143,758 |
EBITDA |
$78,281 |
|
$81,371 |
|
$59,182 |
|
$300,020 |
|
$332,647 |
|
|
|
|
|
|
|
|
|
|
St. Helens charges |
$457 |
|
$- |
|
$31,288 |
|
$31,745 |
|
$- |
Inventory purchase accounting
expense |
- |
|
- |
|
- |
|
- |
|
2,200 |
Loss on extinguishment of
debt |
- |
|
2,300 |
|
- |
|
- |
|
2,300 |
Transaction-related costs |
- |
|
1,364 |
|
- |
|
- |
|
3,094 |
EBITDA
excluding special items |
$78,738 |
|
$85,035 |
|
$90,470 |
|
$331,765 |
|
$340,241 |
The following table reconciles segment income
(loss) and EBITDA to EBITDA excluding special items (dollars in
thousands):
|
Three Months Ended |
|
Year Ended |
|
December 31 |
|
September 30, |
|
December 31 |
|
2012 |
|
2011 |
|
2012 |
|
2012 |
|
2011 |
Packaging |
|
|
|
|
|
|
|
|
|
Segment income |
$31,630 |
|
$31,837 |
|
$22,715 |
|
$101,626 |
|
$104,996 |
Depreciation, amortization, and
depletion |
15,459 |
|
13,681 |
|
14,823 |
|
60,916 |
|
50,547 |
EBITDA |
47,089 |
|
45,518 |
|
37,538 |
|
162,542 |
|
155,543 |
Inventory purchase accounting
expense |
- |
|
- |
|
- |
|
- |
|
2,200 |
Transaction-related costs
(a) |
- |
|
1,364 |
|
- |
|
- |
|
1,591 |
EBITDA excluding special
items |
$47,089 |
|
$46,882 |
|
$37,538 |
|
$162,542 |
|
$159,334 |
|
|
|
|
|
|
|
|
|
|
Paper |
|
|
|
|
|
|
|
|
|
Segment income |
$14,926 |
|
$21,794 |
|
$5,463 |
|
$73,913 |
|
$112,051 |
Depreciation, amortization, and
depletion |
23,318 |
|
22,596 |
|
21,812 |
|
87,650 |
|
89,482 |
EBITDA |
$38,244 |
|
$44,390 |
|
$27,275 |
|
$161,563 |
|
$201,533 |
St. Helens charges |
457 |
|
- |
|
31,288 |
|
31,745 |
|
- |
EBITDA excluding special
items |
38,701 |
|
44,390 |
|
58,563 |
|
193,308 |
|
201,533 |
|
|
|
|
|
|
|
|
|
|
Corporate
and Other |
|
|
|
|
|
|
|
|
|
Segment loss |
$(8,182) |
|
$(7,280) |
|
$(6,536) |
|
$(27,825) |
|
$(25,858) |
Depreciation, amortization, and
depletion |
1,130 |
|
1,043 |
|
905 |
|
3,740 |
|
3,729 |
Loss on extinguishment of
debt |
- |
|
(2,300) |
|
- |
|
- |
|
(2,300) |
EBITDA |
$(7,052) |
|
$(8,537) |
|
$(5,631) |
|
$(24,085) |
|
$(24,429) |
Loss on extinguishment of
debt |
- |
|
2,300 |
|
- |
|
- |
|
2,300 |
Transaction-related costs
(a) |
- |
|
- |
|
- |
|
- |
|
1,503 |
EBITDA excluding special
items |
(7,052) |
|
(6,237) |
|
(5,631) |
|
(24,085) |
|
(20,626) |
|
|
|
|
|
|
|
|
|
|
EBITDA |
$78,281 |
|
$81,371 |
|
$59,182 |
|
$300,020 |
|
$332,647 |
|
|
|
|
|
|
|
|
|
|
EBITDA
excluding special items |
$78,738 |
|
$85,035 |
|
$90,470 |
|
$331,765 |
|
$340,241 |
(a)Transaction-related costs include expenses
associated with transactions, whether consummated or not, and do
not include integration costs.
The following table reconciles net income to net
income excluding special items and presents net income per diluted
share excluding special items (unaudited, dollars and shares in
thousands, except per-share data):
|
Three Months Ended |
|
Year Ended |
|
December 31 |
|
September 30, |
|
December 31 |
|
2012 |
|
2011 |
|
2012 |
|
2012 |
|
2011 |
Net income |
$13,547 |
|
$16,255 |
|
$3,603 |
|
$52,150 |
|
$75,210 |
St. Helens charges |
457 |
|
- |
|
31,288 |
|
31,745 |
|
- |
Inventory purchase accounting
expense |
- |
|
- |
|
- |
|
- |
|
2,200 |
Loss on extinguishment of
debt |
- |
|
2,300 |
|
- |
|
- |
|
2,300 |
Transaction-related costs |
- |
|
1,364 |
|
- |
|
- |
|
3,094 |
Tax provision for special items
(a) |
(177) |
|
(1,418) |
|
(12,108) |
|
(12,285) |
|
(2,939) |
Net income excluding special
items |
$13,827 |
|
$18,501 |
|
$22,783 |
|
$71,610 |
|
$79,865 |
|
|
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding: diluted |
101,180 |
|
106,613 |
|
101,030 |
|
101,143 |
|
106,746 |
Net income excluding special
items per diluted share |
$0.14 |
|
$0.17 |
|
$0.23 |
|
$0.71 |
|
$0.75 |
(a) Taxes are applied to special items in the
aggregate at the combined federal and state statutory rate in
effect for the period.
The following table reconciles cash provided by
operations to free cash flow (unaudited, dollars in thousands):
|
Three Months Ended |
|
Year Ended |
|
December 31 |
|
September 30, |
|
December 31 |
|
2012 |
|
2011 |
|
2012 |
|
2012 |
|
2011 |
Cash provided by operations |
$69,756 |
|
$74,646 |
|
$92,147 |
|
$235,030 |
|
$250,191 |
Expenditures for property and
equipment |
(55,349) |
|
(44,893) |
|
(29,836) |
|
(137,642) |
|
(128,762) |
Free cash flow |
$14,407 |
|
$29,753 |
|
$62,311 |
|
$97,388 |
|
$121,429 |
SOURCE: Boise Inc.
Greg Jones
Director, Investor Relations
208-384-7141
Virginia Aulin
Vice President, Human Resources and Corporate Affairs
208-384-7837
http://www.boiseinc.com/
This
announcement is distributed by Thomson Reuters on behalf of Thomson
Reuters clients.
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the
information contained therein.
Source: Boise Paper Holdings LLC via Thomson Reuters
ONE
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