MEMPHIS, Tenn., July 30 /PRNewswire-FirstCall/ -- International
Paper (NYSE:IP) today reported preliminary 2009 second-quarter net
earnings attributable to common shareholders of $136 million ($0.32
per share) compared with $257 million ($0.61 per share) in the
first quarter of 2009 and $227 million ($0.54 per share) in the
second quarter of 2008. Amounts in all periods include special
items. (Logo: http://www.newscom.com/cgi-bin/prnh/20020701/IPLOGO )
Diluted Earnings Per Share Attributable to International Paper
Shareholders Second First Second Quarter Quarter Quarter 2009 2009
2008 ------ ------ ------- Net Earnings $0.32 $0.61 $0.54 -----
----- ----- Add Back - Net Special Items Expense (Income) (0.12)
(0.53) 0.02 ----- ----- ---- Earnings from Continuing Operations
and Before $0.20 $0.08 $0.56 Special Items ===== ===== =====
Earnings from continuing operations and before special items in the
2009 second quarter totaled $86 million ($0.20 per share), compared
with $34 million ($0.08 per share) in the first quarter of 2009 and
$235 million ($0.56 per share) in the second quarter of 2008.
Quarterly net sales were $5.8 billion in the second quarter
compared with $5.6 billion in the first quarter of 2009 and $5.8
billion reported in the second quarter of 2008. Operating profits
in the 2009 second quarter were $788 million, up from $779 million
in the first quarter of 2009 and $393 million in the second quarter
of 2008. "Over the course of this recession, International Paper
has consistently demonstrated our ability to execute well despite
the economic environment," said Chairman and Chief Executive
Officer John Faraci. "Our performance in the second quarter once
again generated solid earnings and strong free cash flow. We're
also well ahead of our announced plans to pay down debt. "When we
look at global economic conditions today, it appears the worst is
behind us. We have not seen any signs of sustainable progress in
North America, but it appears demand has stabilized at lower
levels. We are seeing improvement in Latin American paper markets
and solid packaging demand growth in China. The good news is that
mill and channel inventories are lean for both paper and
containerboard, which positions us well for the eventual upturn in
demand." At the end of the 2009 second quarter, International Paper
had $4.2 billion in cash and committed liquidity facilities. The
company also generated $1.3 billion of free cash flow (cash
provided by operations less capital expenditures) during the
quarter, reflecting its continued focus on reducing capital
spending, managing working capital and decreasing overhead
spending, as well as cash received from alternative fuel mixture
credits. The company also repaid $600 million of debt. SEGMENT
INFORMATION To measure the performance of the company's business
segments from quarter to quarter without variations caused by
special or unusual items, management focuses on business segment
operating profits excluding those items. Second-quarter 2009
segment operating profits and business trends, excluding special
items, compared with the prior quarter are as follows: Industrial
Packaging operating profits increased to $255 million, up from $188
million in the first quarter of 2009 as improved volume, favorable
input costs, strong manufacturing operations and synergy benefits
related to the CBPR acquisition offset weakened pricing. Printing
Papers had operating profits of $86 million compared with an
operating profit of $101 million in the first quarter of 2009.
Benefits from improved volume, input cost relief and strong
operations were offset by higher annual maintenance outages, mix
and pricing pressure in global paper and pulp markets. Consumer
Packaging had operating profits of $38 million, up from $22 million
in the previous quarter due to improvements in volume and operating
performance, as well as lower input costs, partially offset by
higher annual maintenance outages. The company's distribution
business, xpedx, reported operating profits of $10 million, up from
a loss of $7 million in the previous quarter due to cost reductions
and improved volumes. Forest Products operating profits totaled $3
million, up from $2 million in the first quarter of 2009. The
pending sale of 143,000 acres is expected to close in the fourth
quarter of 2009, subject to the buyer's receipt of financing. Net
corporate expenses totaled $44 million for the 2009 second quarter,
down from $51 million in the 2009 first quarter but up from $21
million in the second quarter of 2008. The decline compared with
first-quarter levels principally reflects the finalization of
full-year 2009 pension expense based on actual versus estimated
year-end census data. The increase from the 2008 second quarter
reflects higher pension expense, lower supply chain initiative
costs and the effect of an $11 million gain on the sale of the
former Natchez mill site in 2008. EFFECTIVE TAX RATE The effective
tax rate from continuing operations and before special items was 33
percent for both the second and first quarters of 2009 compared
with 32.5 percent in the second quarter of 2008. EFFECTS OF SPECIAL
ITEMS Special items in the second quarter of 2009 included a credit
of $482 million before taxes ($294 million after taxes) for
alternative fuel mixture credits earned under 2007 legislation
enacted to provide a tax credit for companies that use alternative
fuel mixtures to produce energy to operate their businesses, a $48
million before and after-tax charge to write down the assets of the
Etienne mill in France to estimated fair value, a $18 million
pre-tax charge ($11 million after taxes) for integration costs
associated with the Industrial Packaging business integration, and
a pre-tax charge of $79 million ($55 million after taxes) for
restructuring and other charges. Restructuring and other charges
included a $34 million charge before taxes ($21 million after
taxes) for severance and benefit costs associated with the
Company's 2008 overhead reduction program, a $25 million charge
before taxes ($16 million after taxes) for early debt
extinguishment costs, a $15 million before and after-tax charge for
severance and other costs related to the Company's Etienne mill in
France, and a $5 million charge before taxes ($3 million after
taxes) for other closure costs. Additionally, the second-quarter
income tax provision included a $156 million charge to establish a
valuation allowance for net operating loss carryforwards in France,
and a $26 million credit related to the closing of the 2004 and
2005 U.S. federal income tax audit and related state income tax
effects. Special items in the first quarter of 2009 included a
credit of $540 million before taxes ($330 million after taxes) for
alternative fuel mixture credits, a pre-tax charge of $36 million
($22 million after taxes) for costs related to the Industrial
Packaging business integration, a pre-tax charge of $83 million
($65 million after taxes) for restructuring and other charges, and
a $20 million after-tax charge for certain income tax adjustments.
Restructuring and other charges included a $52 million pre-tax
charge ($32 million after taxes) for severance and benefits
associated with the company's 2008 overhead reduction program, a
pre-tax charge of $23 million ($28 million after taxes) for closure
costs for the Inverurie mill in Scotland, a $6 million pre-tax
charge ($4 million after taxes) for closure costs for the Franklin
lumber mill, sheet converting plant and converting innovations
center, and a $2 million pre-tax charge ($1 million after taxes)
for costs associated with the reorganization of the company's
Shorewood operations. Special items in the second quarter of 2008
consisted of a $13 million pre-tax charge ($9 million after taxes)
for costs associated with the reorganization of Shorewood
operations in Canada and a $3 million pre-tax gain ($2 million
after taxes) for an adjustment to the gain on the 2006
transformation plan forestland sales. EARNINGS WEBCAST The company
will hold a webcast to review earnings at 10 a.m. EDT / 9 a.m. CDT
today. All interested parties are invited to listen to the webcast
live via the company's Internet site at
http://www.internationalpaper.com/ by clicking on the Investors tab
and going to the Presentations page. A replay of the webcast will
also be available on the Web site beginning approximately two hours
after the call. Parties who wish to participate in the webcast via
teleconference may dial +1 (706) 679-8242 or, within the U.S. only,
(877) 316-2541 and ask to be connected to the International Paper
Second-Quarter Earnings Call. The conference ID number is 15781616.
Participants should call in no later than 9:45 a.m. EDT/8:45 a.m.
CDT. An audio-only replay will be available for four weeks
following the call. To access the replay, dial +1 (706) 645-9291
or, within the U.S. only, (800) 642-1687, and when prompted for the
conference ID, enter 15781616. About International Paper
International Paper (NYSE:IP) is a global paper and packaging
company with manufacturing operations in North America, Europe,
Latin America, Russia, Asia and North Africa. Its businesses
include uncoated papers and industrial and consumer packaging,
complemented by xpedx, the company's North American distribution
company. Headquartered in Memphis, Tenn., the company employs more
than 58,000 people in more than 20 countries and serves customers
worldwide. 2008 net sales were approximately $25 billion. For more
information about International Paper, its products and stewardship
efforts, visit http://www.internationalpaper.com/. This press
release contains forward-looking statements. These statements
reflect management's current views and are subject to risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied in these statements. Factors which
could cause actual results to differ relate to: (i) increases in
interest rates and our ability to meet our debt service
obligations; (ii) industry conditions, including but not limited to
changes in the cost or availability of raw materials, energy and
transportation costs, competition we face, cyclicality and changes
in consumer preferences, demand and pricing for its products; (iii)
global economic conditions and political changes, including but not
limited to the impairment of financial institutions, changes in
currency exchange rates, credit availability, credit ratings issued
by recognized credit rating organizations, the amount of our future
pension funding obligation, changes in tax laws and pension and
health care costs; (iv) unanticipated expenditures related to the
cost of compliance with environmental and other governmental
regulations and to actual or potential litigation; and (v) whether
we experience a material disruption at one of our manufacturing
facilities and risks inherent in conducting business through a
joint venture. We undertake no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise. These and other factors that could
cause or contribute to actual results differing materially from
such forward looking statements are discussed in greater detail in
the company's Securities and Exchange Commission filings.
INTERNATIONAL PAPER COMPANY Consolidated Statement of Operations
Preliminary and Unaudited (In millions, except per share amounts)
Three Months Three Months Six Months Ended Ended Ended June 30,
March 31, June 30, ------------- --------- ----------------- 2009
2008 2009 2009 2008 ---- ---- ---- ---- ---- Net Sales $5,802
$5,807 $5,668 $11,470 $11,475 ------ ------ ------ ------- -------
Costs and Expenses Cost of products sold 3,781(a) 4,305 3,731(h)
7,512(k) 8,566 Selling and administrative expenses 508(b) 459
500(i) 1,008(l) 931 Depreciation, amortization and cost of timber
harvested 367 305 343 710 591 Distribution expenses 279 301 279 558
586 Taxes other than payroll and income taxes 47 44 50 97 88
Restructuring and other charges 79(c) 13(f) 83(j) 162(m) 55(n)
Forestland sales - (3)(g) - - (3)(g) Net (gains) losses on sales
and impairments of businesses 48(d) - - 48(d) (1) Interest expense,
net 173 81 164 337 162 --- --- --- --- --- Earnings From Continuing
Operations Before Income Taxes and Equity Earnings 520(a-d)
302(f,g) 518(h-j)1,038(d,k-m) 500(g,n) Income tax provision 348(e)
97 230 578(e) 156 Equity earnings (losses), net of taxes (32) 30
(27) (59) 46 --- --- --- --- --- Earnings From Continuing
Operations 140(a-e) 235(f,g) 261(h-j) 401(d,e,k-m) 390(g,n)
Discontinued operations, net of taxes - (1) - - (18)(o) --- --- ---
--- --- Net Earnings $140(a-e) $234(f,g) $261(h-j) $401(d,e,k-m)
$372 Less: Net earnings attributable to noncontrolling interests 4
7 4 8 12 --- --- --- --- --- Net Earnings Attributable to
International Paper Company $136(a-e) $227(f,g) $257(h-j)
$393(d,e,k-m) $360(g,n,o) ==== ==== ==== ==== ==== Basic Earnings
Per Common Share Attributable to International Paper Common
Shareholders Earnings from continuing operations
$0.32(a-e)$0.54(f,g)$0.61(h-j)$0.93(d,e,k-m)$0.90(g,n) Discontinued
operations - - - - (0.04)(o) ----- ----- ----- ----- ----- Net
earnings $0.32(a-e)$0.54(f,g)$0.61(h-j)$0.93(d,e,k-m)$0.86(g,n,o)
===== ===== ===== ===== ===== Diluted Earnings Per Common Share
Attributable to International Paper Common Shareholders Earnings
from continuing operations
$0.32(a-e)$0.54(f,g)$0.61(h-j)$0.93(d,e,k-m)$0.89(g,n) Discontinued
operations - - - - (0.04)(o) ----- ----- ----- ----- ----- Net
earnings $0.32(a-e)$0.54(f,g)$0.61(h-j)$0.93(d,e,k-m)$0.85(g,n,o)
===== ===== ===== ===== ===== Average Shares of Common Stock
Outstanding - Diluted 425.4 422.6 423.1 424.2 423.9 ===== =====
===== ===== ===== Cash Dividends Per Common Share $0.025 $0.25
$0.25 $0.275 $0.50 ====== ===== ===== ====== ===== Amounts
Attributable to International Paper Common Shareholders Earnings
from continuing operations, net of tax $136 $228 $257 $393 $378
Discontinued operations, net of tax - (1) 0 - (18) ---- ---- ----
---- ---- Net Earnings $136 $227 $257 $393 $360 ==== ==== ==== ====
==== The accompanying notes are an integral part of this
consolidated statement of operations. (a) Includes a pre-tax gain
of $482 million ($294 million after taxes) related to alternative
fuel mixture credits. (b) Includes a pre-tax charge of $18 million
($11 million after taxes) for integration costs associated with the
Containerboard, Packaging and Recycling business (CBPR) acquired
from Weyerhaeuser Company in August 2008. (c) Includes a pre-tax
charge of $34 million ($21 million after taxes) for severance and
benefit costs associated with the Company's 2008 overhead cost
reduction initiative, a pre-tax charge of $25 million ($16 million
after taxes) for early debt extinguishment costs, a charge of $15
million (before and after taxes) for severance and other costs
associated with the Etienne mill in France, and a pre-tax charge of
$5 million ($3 million after taxes) for other items. (d) Includes a
pre-tax charge of $48 million (before and after taxes) to write
down the assets at the Etienne mill to estimated fair value. (e)
Includes a $156 million tax expense for the write off of deferred
tax assets in France and a $26 million tax benefit related to the
closing of the 2004 and 2005 U.S. federal income tax audit, and
related state income tax effects. (f) Includes a pre-tax charge of
$13 million ($9 million after taxes) for costs associated with the
reorganization of the Company's Shorewood operations in Canada. (g)
Includes a pre-tax gain of $3 million ($2 million after taxes) for
an adjustment to the gain on the 2006 Transformation Plan
forestland sales. (h) Includes a pre-tax gain of $540 million ($330
million after taxes) related to alternative fuel mixture credits.
(i) Includes a pre-tax charge of $36 million ($22 million after
taxes) for integration costs associated with the CBPR business. (j)
Includes a pre-tax charge of $52 million ($32 million after taxes)
for severance and benefit costs associated with the Company's 2008
overhead cost reduction initiative, a pre-tax charge of $23 million
($28 million after taxes) for closure costs associated with the
Inverurie, Scotland mill, a pre-tax charge of $6 million ($4
million after taxes) for shutdown costs associated with the
Franklin lumber mill, sheet converting plant and converting
innovations center, and a pre-tax charge of $2 million ($1 million
after taxes) for shutdown costs associated with the reorganization
of the Company's Shorewood operations. (k) Includes a pre-tax gain
of $1 billion ($624 million after taxes) related to alternative
fuel mixture credits. (l) Includes a pre-tax charge of $54 million
($33 million after taxes) for integration costs associated with the
CBPR business. (m) Includes a pre-tax charge of $86 million ($53
million after taxes) for severance and benefit costs associated
with the Company's 2008 overhead cost reduction initiative, a
pre-tax charge of $23 million ($28 million after taxes) for closure
costs associated with the Inverurie, Scotland mill, a pre-tax
charge of $25 million ($16 million after taxes) for early debt
extinguishment costs, a pre-tax charge of $15 million (before and
after taxes) for severance and other costs associated with the
Etienne mill, and a pre-tax charge of $13 million ($8 million after
taxes) for other items. (n) Includes a $40 million pre-tax charge
($25 million after taxes) for adjustments to legal reserves, a
pre-tax charge of $18 million ($12 million after taxes) for costs
associated with the reorganization of the Company's Shorewood
operations in Canada, and a pre-tax gain of $3 million ($2 million
after taxes) for adjustments to previously recorded reserves
associated with the Company's Transformation Plan. (o) Includes a
pre-tax charge of $25 million ($16 million after taxes) for the
settlement of a post-closing adjustment on the sale of the beverage
packaging business and the operating results of certain wood
products facilities during the quarter. International Paper Company
Reconciliation of Earnings Before Special Items to Net Earnings
Attributable to International Paper Company (In millions except for
per share amounts) Three Months Three Months Six Months Ended Ended
Ended June 30, March 31, June 30, -------- ---------- -------- 2009
2008 2009 2009 2008 ---- ---- ---- ---- ---- Earnings Before
Special Items $86 $235 $34 $120 $410 Restructuring and other
charges (55) (9) (65) (120) (35) CBPR business integration costs
(11) - (22) (33) - Alternative fuel mixture credits 294 - 330 624 -
Forestland sales - 2 - - 2 Net gains (losses) on sales and
impairments of businesses (48) - - (48) 1 Income tax adjustments
(130) - (20) (150) - --- --- --- --- --- Earnings from Continuing
Operations 136 228 257 393 378 Discontinued operations - (1) - -
(18) ---- ---- ---- ---- ---- Net Earnings as Reported $136 $227
$257 $393 $360 ==== ==== ==== ==== ==== Three Months Three Months
Six Months Ended Ended Ended June 30, March 31, June 30, Diluted
Earnings per -------- --------- -------- Common Share 2009 2008
2009 2009 2008 ---- ---- ---- ---- ---- Earnings Per Share Before
Special Items $0.20 $0.56 $0.08 $0.28 $0.97 Restructuring and other
charges (0.13) (0.02) (0.15) (0.28) (0.08) CBPR business
integration costs (0.03) - (0.05) (0.08) - Alternative fuel mixture
credits 0.69 - 0.78 1.47 - Net gains (losses) on sales and
impairments of businesses (0.11) - - (0.11) - Income tax
adjustments (0.30) - (0.05) (0.35) - ---- --- ---- ---- ---
Earnings Per Common Share from Continuing Operations 0.32 0.54 0.61
0.93 0.89 Discontinued operations - - - - (0.04) ---- ---- ----
---- ---- Diluted Earnings per Common Share $0.32 $0.54 $0.61 $0.93
$0.85 ===== ===== ===== ===== ===== Notes: (1) The Company
calculates Earnings Before Special Items by excluding the after-tax
effect of items considered by management to be unusual from the
earnings reported under U.S. generally accepted accounting
principles ("GAAP"). Management uses this measure to focus on
on-going operations, and believes that it is useful to investors
because it enables them to perform meaningful comparisons of past
and present operating results. International Paper believes that
using this information, along with net earnings, provides for a
more complete analysis of the results of operations by quarter. Net
earnings is the most directly comparable GAAP measure. (2) Diluted
earnings per common share reflect the inclusion of contingently
convertible securities in the computation. (3) Since diluted
earnings per share are computed independently for each period,
six-month per share amounts may not equal the sum of the respective
quarters. International Paper Sales and Earnings by Industry
Segment Preliminary and Unaudited (In Millions) Sales by Industry
Segment Three Three Six Months Months Months Ended Ended Ended June
30, March 31, June 30, -------- -------- -------- 2009 2008 2009
2009 2008 ---- ---- ---- ---- ---- Industrial Packaging $2,270
$1,470 $2,180 $4,450 $2,915 Printing Papers 1,360 1,790 1,325 2,685
3,505 Consumer Packaging 770 795 715 1,485 1,565 Distribution 1,595
1,970 1,590 3,185 3,955 Forest Products 10 55 5 15 80 Corporate and
Inter- segment Sales (203) (273) (147) (350) (545) ---- ---- ----
---- ---- Net Sales $5,802 $5,807 $5,668 $11,470 $11,475 ======
====== ====== ======= ======= Operating Profit by Industry Segment
Three Three Six Months Months Months Ended Ended Ended June 30,
March 31, June 30, -------- -------- -------- 2009 2008 2009 2009
2008 ---- ---- ---- ---- ---- Industrial Packaging $382(2,3,4) $87
$360(2,4) $742(2,3,4) $184 Printing Papers 279(2,5) 226 312(2,5)
591(2,5) 411 Consumer Packaging 114(2,6) 13(6) 112(2,6) 226(2,6)
22(6) Distribution 10 26 (7) 3 42 Forest Products 3 41 2 5 66 ---
--- --- --- --- Operating Profit (1) 788 393 779 1,567 725 Interest
expense, net (173) (81) (164) (337) (162) Noncontrolling
interest/equity earnings adjustment (7) 8 8 6 14 12 Corporate
items, net (44) (21) (51) (95) (42) Restructuring and other charges
(59) - (52) (111) (37) Sale of forestlands - 3 - - 3 Net gains on
sales and impairments of businesses - - - - 1 --- --- --- --- ---
Earnings (Loss) From Continuing Operations Before Income Taxes and
Equity Earnings $520 $302 $518 $1,038 $500 ==== ==== ==== ======
==== Equity Earnings (Loss) in Ilim Holdings S.A., Net of Taxes (1)
$(30) $32 $(26) $(56) $49 ==== === ==== ==== === (1) In addition to
the operating profits shown above, International Paper recorded
equity losses, net of taxes, of $30 million for the three months
ended June 30, 2009, and $26 million for the three months ended
March 31, 2009, and $56 million for the six months ended June 30,
2009, and equity earnings, net of taxes, of $32 million for the
three months ended June 30, 2008, and $49 million for the six
months ended June 30, 2008, related to its equity investment in
Ilim Holdings S.A., a separate reportable industry segment. (2)
Includes gains of $208 million and $208 million in the Industrial
Packaging segment, $197 million and $240 million in the Printing
Papers segment, and $77 million and $92 million in the Consumer
Packaging segment for the three months ended June 30, 2009 and
March 31, 2009, respectively, relating to alternative fuel mixture
credits. (3) Includes charges of $48 million to write down the
assets at the Etienne mill in France to estimated fair value and
$15 million for severance and other costs related to the Etienne
mill. (4) Includes charges of $18 million and $36 million for the
three months ended June 30, 2009 and March 31, 2009, respectively,
for CBPR integration costs. (5) Includes charges of $4 million and
$6 million for the three months ended June 30, 2009 and March 31,
2009, respectively, for shutdown costs for the Louisiana mill and
the Franklin lumber mill, sheet converting plant and converting
innovations center, and a charge of $23 million for the three
months ended March 31, 2009 for the closure of the Inverurie,
Scotland mill. (6) Includes charges of $1 million, $13 million, and
$2 million for the three months ended June 30, 2009, June 30, 2008,
and March 31, 2009, and $3 million and $18 million for the six
months ended June 30, 2009 and 2008, related to the reorganization
of the Company's Shorewood operations. (7) Operating profits for
industry segments include each segment's percentage share of the
profits of subsidiaries included in that segment that are less than
wholly owned. The pre-tax noncontrolling interest and equity
earnings for these subsidiaries are adjusted here to present
consolidated earnings before income taxes and equity earnings.
International Paper Sales Volume by Product (1) (2) Preliminary and
Unaudited International Paper Consolidated Three Three Months
Months Six Months Ended Ended Ended June 30, March 31, June 30,
-------- --------- -------- 2009 2008 2009 2009 2008 ---- ---- ----
---- ---- Industrial Packaging (In thousands of short tons)
Corrugated Packaging (4) 1,899 896 1,776 3,675 1,778 Containerboard
(4) 530 493 471 1,001 999 Recycling (4) 598 - 595 1,193 - Saturated
Kraft 29 39 21 50 85 Bleached Kraft 17 22 13 30 41 European
Industrial Packaging 268 288 270 538 583 Asian Industrial Packaging
139 152 88 227 290 --- --- -- --- --- Industrial Packaging 3,480
1,890 3,234 6,714 3,776 ----- ----- ----- ----- ----- Printing
Papers (In thousands of short tons) U.S. Uncoated Papers 702 868
693 1,395 1,778 European & Russian Uncoated Papers 332 373 370
702 746 Brazilian Uncoated Papers 234 211 180 414 421 Asian
Uncoated Papers 12 7 3 15 15 -- -- -- -- -- Uncoated Papers 1,280
1,459 1,246 2,526 2,960 ----- ----- ----- ----- ----- Market Pulp
(3) 375 416 317 692 770 --- --- --- --- --- Consumer Packaging (In
thousands of short tons) U.S. Coated Paperboard 318 399 290 608 799
European Coated Paperboard 92 73 87 179 154 Asian Coated Paperboard
218 123 189 407 248 Other Consumer Packaging 42 46 46 88 87 -- --
-- -- -- Consumer Packaging 670 641 612 1,282 1,288 --- --- ---
----- ----- (1) Sales volumes include third party and inter-segment
sales and exclude sales of equity investees. (2) Sales volumes for
divested businesses are included through the date of sale, except
for discontinued operations. (3) Includes internal sales to mills.
(4) Includes CBPR volumes from date of acquisition. INTERNATIONAL
PAPER COMPANY Consolidated Balance Sheet Preliminary and Unaudited
(In Millions) June 30, December 31, 2009 2008 ---- ---- Assets
Current Assets Cash and Temporary Investments $1,654 $1,144
Accounts and Notes Receivable, Net 3,312 3,288 Inventories 2,209
2,495 Deferred Income Tax Assets 166 261 Other 208 172 --- ---
Total Current Assets 7,549 7,360 ----- ----- Plants, Properties and
Equipment, Net 13,766 14,202 Forestlands 691 594 Investments 1,068
1,274 Goodwill 2,248 2,027 Deferred Charges and Other Assets 1,326
1,456 ----- ----- Total Assets $26,648 $26,913 ======= =======
Liabilities and Equity Current Liabilities Notes Payable and
Current Maturities of Long-Term Debt $386 $828 Accounts Payable and
Accrued Liabilities 3,564 3,927 ----- ----- Total Current
Liabilities 3,950 4,755 ----- ----- Long-Term Debt 10,531 11,246
Deferred Income Taxes 2,359 1,957 Pension Benefit Obligation 3,294
3,260 Postretirement and Postemployment Benefit Obligation 643 663
Other Liabilities 792 631 Equity Invested Capital 3,142 2,739
Retained Earnings 1,701 1,430 ----- ----- Total Shareholders'
Equity 4,843 4,169 ----- ----- Non-controlling interests 236 232
--- --- Total Equity 5,079 4,401 ----- ----- Total Liabilities and
Equity $26,648 $26,913 ======= ======= INTERNATIONAL PAPER COMPANY
Consolidated Statement of Cash Flows Preliminary and Unaudited (In
Millions) Six Months Ended June 30, -------- 2009 2008 ---- ----
Operating Activities Net earnings attributable to International
Paper Company $393 $360 Noncontrolling interests 8 12 Discontinued
operations, net of taxes and noncontrolling interest - 18 -- --
Earnings from continuing operations 401 390 Depreciation,
amortization and cost of timber harvested 710 591 Deferred income
tax expense (benefit), net 539 (113) Restructuring and other
charges 162 55 Payments related to restructuring and legal reserves
(24) (42) Net (gains) losses on sales and impairments of businesses
48 (1) Equity loss (earnings), net 59 (46) Periodic pension
expense, net 107 57 Alternative fuel mixture credits receivable
(189) - Other, net 107 33 Changes in current assets and liabilities
Accounts and notes receivable 195 (27) Inventories 310 (90)
Accounts payable and accrued liabilities (165) 137 Interest payable
(32) (27) Other (39) 93 --- -- Cash Provided by Operations 2,189
1,010 ----- ----- Investment Activities Invested in capital
projects (259) (482) Acquisitions, net of cash received (8) -
Proceeds from divestitures - 14 Equity investment in Ilim - (21)
Other (59) (159) --- ---- Cash Used for Investment Activities (326)
(648) ---- ---- Financing Activities Repurchases of common stock
and payments of restricted stock tax withholding (10) (47) Issuance
of common stock - 1 Issuance of debt 1,476 3,135 Reduction of debt
(2,617) (125) Change in book overdrafts (72) (53) Dividends paid
(118) (218) Other (35) (20) --- --- Cash (Used for) Provided by
Financing Activities (1,376) 2,673 ------ ----- Effect of Exchange
Rate Changes on Cash 23 39 -- -- Change in Cash and Temporary
Investments 510 3,074 Cash and Temporary Investments Beginning of
the period 1,144 905 ----- --- End of the period $1,654 $3,979
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