BOISE, Idaho, Feb. 25 /PRNewswire-FirstCall/ -- Boise Inc.
(NYSE:BZ) today reported net income of $55.7 million or $0.66 per
diluted share for fourth quarter 2009, compared with fourth quarter
2008 net loss of $15.5 million or ($0.20) per diluted share. Net
income for 2009 was $153.8 million or $1.85 per diluted share. Net
income excluding special items in fourth quarter 2009 was $4.2
million, or $0.05 per diluted share. EBITDA excluding special items
was $54.4 million for fourth quarter 2009 compared with $76.0
million for fourth quarter 2008. EBITDA excluding special items for
2009 was $232.1 million compared with $247.1 million for combined
2008. Net total debt at December 31, 2009, was $736.5 million,
compared with $1,081.5 million at December 31, 2008. FINANCIAL
HIGHLIGHTS (in millions, except per-share data) Boise Inc. Combined
Predecessor Boise Inc. -------------------------------- --------
----------- ---------- 4Q 2009 4Q 2008 3Q 2009 2009 2008 2008 2008
------- ------- ------- ---- ---- ---- ---- Sales $490.3 $591.1
$508.3 $1,978.2 $2,430.6 $359.9 $2,070.6 Net income (loss) $55.7
$(15.5) $48.2 $153.8 $22.8 $(45.5) Net income (loss) per diluted
share $0.66 $(0.20) $0.57 $1.85 N/A $(0.62) Net income (loss)
excluding special items (a) $4.2 $5.7 $10.3 $20.4 N/A $2.1 Net
income (loss) excluding special items per diluted share(a) $0.05
$0.07 $0.12 $0.25 N/A $0.03 EBITDA (b) $84.3 $41.4 $128.0 $395.7
$168.8 $23.7 $145.1 EBITDA excluding special items (b) $54.4 $76.0
$66.2 $232.1 $247.1 $24.4 $222.8 Net total debt $736.5 $1,081.5
$781.9 Free cash flow (c) $75.5 $7.7 $121.2 $381.6 $3.9 (a) For
reconciliation of net income (loss) excluding special items to net
income (loss), see "Summary Notes to Consolidated Financial
Statements and Segment Information." (b) For reconciliation of net
income (loss) to EBITDA and EBITDA to EBITDA excluding special
items, see "Summary Notes to Consolidated Financial Statements and
Segment Information." (c) Cash provided by (used for) operations
less expenditures for property and equipment. "Against a very
difficult backdrop, our performance was strong in 2009, and we
accomplished many of our objectives," said Alexander Toeldte,
President and Chief Executive Officer of Boise Inc. "We ran well
and had one of our safest years on record. In 2009, we generated
$382 million in free cash flow, extracted $92 million in cash
through working capital reductions, and reduced our net total debt
by $345 million, a 32% reduction from the end of 2008. We reduced
our interest costs and extended debt maturities through the
refinancing we completed in October. We continued to shift
production capacity to packaging demand-driven and office paper
products and lowered our structural costs through difficult but
necessary asset portfolio moves at our St. Helens and DeRidder
mills. And, we grew sales volumes of our label and release,
flexible packaging, and premium office grades 4% over 2008 through
some of the most challenging markets we've experienced. I am proud
of what we've accomplished, and we look forward to building on
these successes in 2010." Sales Total sales for fourth quarter 2009
were $490.3 million, a decrease of $100.8 million, or 17%, from
$591.1 million for fourth quarter 2008 and down 4% from third
quarter 2009 sales of $508.3 million. Paper segment sales decreased
11% during fourth quarter 2009 compared with fourth quarter 2008,
driven by lower sales volumes and prices. In first quarter 2009, we
completed the downsizing of our mill in St. Helens, Oregon, which
eliminated 13% of our annual uncoated freesheet capacity and
reduced 2009 sales volumes and costs compared with 2008. Packaging
segment sales decreased 30% during fourth quarter 2009 compared
with fourth quarter 2008, driven by lower sales volumes of
newsprint due to the indefinite idling of our DeRidder #2 newsprint
machine and lower sales prices of packaging products. These
declines were offset partially by higher sales volumes of
linerboard. Full year 2009 sales were $2.0 billion, a 19% decrease
over combined year 2008 sales of $2.4 billion. The decrease was
driven primarily by a 14% decrease in Paper segment sales due to
lower sales volumes, offset partially by higher sales prices for
uncoated freesheet papers, and a 28% decline in Packaging segment
sales due to lower sales prices and lower newsprint sales volumes.
Prices and Volumes Pricing for uncoated freesheet began to improve
late in 2009 and in early 2010 after declining through the year.
Average net selling prices of uncoated freesheet papers declined
$34 per ton, or 4%, to $935 per ton during fourth quarter 2009
compared with fourth quarter 2008 and decreased 1% from third
quarter 2009. In fourth quarter 2009, we implemented a $40-per-ton
price increase on our offset and envelope grades and on some
premium colored office papers. In January 2010, we announced a
$40-per-ton price increase across most of our cut-size office
papers, offset, and mid-weight opaque grades effective in
mid-February. Overall, uncoated freesheet sales volumes were
309,000 tons during fourth quarter, a decline of 7% versus the
prior year period, and down 5% from third quarter 2009 due
primarily to seasonal demand declines. Full year net selling prices
for uncoated freesheet improved $24 per ton, or 3%, to $954 per ton
in 2009 compared with 2008. Full year sales volumes of uncoated
freesheet papers were 1.3 million tons in 2009, down 13% compared
with the same period in 2008. Combined sales volumes of premium
office, label and release, and flexible packaging papers, which
represented 27% of our total 2009 uncoated freesheet sales volumes,
increased by 4% from the prior year. Corrugated containers and
sheets sales volumes improved 2% during fourth quarter 2009
compared with fourth quarter 2008 and were flat from third quarter
2009. Full year corrugated container and sheet volumes decreased 5%
to 6.0 billion square feet in 2009 compared with 2008, driven
mainly by lower volumes from our sheet feeder plant in Texas as a
result of slowing industrial markets. Corrugated container and
sheet prices declined 11% in fourth quarter 2009 from fourth
quarter 2008 and decreased 7% from third quarter 2009 prices due to
seasonal box mix fluctuations in our agricultural end markets and
containerboard price declines earlier in the year. Full year
corrugated container and sheet prices improved 2% in 2009 compared
with 2008. Linerboard sales volumes to third parties increased 55%
compared with fourth quarter 2008 and increased 9% from third
quarter 2009 due to improving market conditions. Full year
linerboard sales volumes to third parties were 253,000 tons in
2009, a 10% increase compared with 2008. Linerboard net selling
prices to third parties declined to $293 per ton in fourth quarter
2009 from $406 per ton in fourth quarter 2008 and improved 3% from
third quarter 2009, as demand in export markets improved. Full year
net selling prices for linerboard sales to third parties decreased
$96 per ton, or 24%, to $301 per ton in 2009 compared with 2008. In
January 2010, we announced a $50-per-ton and $70-per-ton price
increase on domestic sales in the eastern and western U.S.,
respectively. These price increases are currently being
implemented. Input Costs Total fiber, energy, and chemical costs
for fourth quarter 2009 were $205.0 million, a decrease of $62.0
million, or 23%, from costs of $267.0 million for fourth quarter
2008. Much of the decline was driven by reduced consumption as a
result of the restructuring of our mill in St. Helens, Oregon, and
the idling of our #2 machine at our mill in DeRidder, Louisiana.
Input costs were flat compared with third quarter 2009. Full year
2009 fiber, energy, and chemical costs totaled $800.3 million, a
decrease of $332.5 million, or 29%, from costs of $1,132.8 million
for full year 2008. INPUT COST SUMMARY (in millions) -------
------- ------- ---- Combined 4Q 2009 4Q 2008 3Q 2009 2009 2008
------- ------- ------- ---- ---- Fiber $106.5 $124.0 $108.2 $401.1
$530.0 Energy $45.7 $77.5 $41.9 $188.9 $340.2 Chemicals $52.8 $65.5
$55.7 $210.3 $262.6 Total $205.0 $267.0 $205.8 $800.3 $1,132.8
Total fiber costs during fourth quarter 2009 were $106.5 million, a
decrease of $17.5 million, or 14%, from $124.0 million incurred in
fourth quarter 2008. This was due to lower fiber prices and reduced
consumption of fiber as a result of lower production capacity and
was offset partially by higher purchased pulp consumption. Fiber
costs in fourth quarter 2009 declined $1.7 million, or 2%, from
third quarter 2009. Full year 2009 fiber costs were $401.1 million,
a decrease of $128.9 million, or 24%, from costs of $530.0 million
for combined 2008, due primarily to lower prices and consumption of
fiber. Energy costs in fourth quarter 2009 were $45.7 million, a
decrease of $31.8 million, or 41%, compared with $77.5 million in
fourth quarter 2008, driven by lower prices for natural gas and
electricity and reduced consumption of energy. Energy costs in
fourth quarter 2009 increased $3.8 million, or 9%, from $41.9
million in third quarter 2009, due to higher prices for natural gas
and seasonal increases in consumption as a result of colder winter
weather. Full year 2009 energy costs were $188.9 million, a
decrease of $151.3 million, or 44%, from costs of $340.2 million
for combined 2008, driven by reduced prices and consumption of
natural gas and electricity. Chemical costs in fourth quarter 2009
were $52.8 million, a decrease of $12.7 million, or 19%, compared
with $65.5 million in fourth quarter 2008. Chemical costs were down
$2.8 million, or 5%, compared with $55.7 million in third quarter
2009. Full year 2009 chemical costs were $210.3 million, a decrease
of $52.3 million, or 20%, from $262.6 million for combined 2008.
The key drivers were lower prices and generally lower consumption
of commodity chemicals. Alternative Fuel Mixture Credit During the
three months and year ended December 31, 2009, we recorded $72.7
million and $207.6 million, respectively, of alternative fuel
mixture credits, net of associated fees and expenses and before
taxes. As of December 31, 2009, we recorded a receivable of $56.6
million for alternative fuel mixture credits. These credits expired
on December 31, 2009. In October 2009, we began filing for
alternative fuel mixture credits as a refundable credit on our
income tax return instead of as a refundable excise tax credit.
This filing change will not affect the total amount we expect to
ultimately receive but does delay receipt of fuel mixture credit
payments until after we file our federal income tax return in first
quarter 2010. Extinguishment of Debt In connection with the debt
restructuring in October 2009, we recognized a $44.1 million loss
on the extinguishment of debt during the three months ended
December 31, 2009. Income Tax Benefit During the three months ended
December 31, 2009, we reversed income tax valuation allowances of
$33.2 million. Webcast and Conference Call Boise Inc. will host a
webcast and conference call on Thursday, February 25, 2010, at
11:00 a.m. EST, 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 832-4451689). The
webcast may be accessed through Boise's Internet site and will be
archived for one year following the call. Go to
http://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 February 25 at 2:00 p.m. EST through March 25 at
11:45 p.m. EDT. Playback numbers are 800-642-1687 for U.S. callers
and 706-645-9291 for international callers. The passcode is
56233892. Annual Meeting Date Boise Inc. intends to hold its annual
meeting of shareholders at 10:00 a.m. MDT on Thursday, April 29,
2010, in Boise, Idaho. The record date to determine shareholders
eligible to vote at the meeting is March 12, 2010. 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 entire team of
approximately 4,100 employees is committed to delivering excellent
value while managing our businesses to sustain environmental
resources for future generations. Visit our Web site at
http://www.boiseinc.com/. Basis of Presentation We present our
consolidated financial statements in accordance with U.S. generally
accepted accounting principles (GAAP). Our earnings release also
supplements the GAAP presentations by reflecting EBITDA. EBITDA
represents income (loss) before interest (change in fair value of
interest rate derivatives, interest expense, and interest income),
income taxes, and depreciation, amortization, and depletion. EBITDA
is the primary measure used by our chief operating decision makers
to evaluate segment operating performance and to decide how to
allocate resources to segments. We believe EBITDA is useful to
investors because it provides a means to evaluate the operating
performance of our segments and our company on an ongoing basis
using criteria that are used by our internal decision makers and
because it is frequently used by investors and other interested
parties in the evaluation of companies with substantial financial
leverage. We believe EBITDA is a meaningful measure because it
presents a transparent view of our recurring operating performance
and allows management to readily view operating trends, perform
analytical comparisons, and identify strategies to improve
operating performance. For example, we believe that the inclusion
of items such as taxes, interest expense, and interest income
distorts management's ability to assess and view the core operating
trends in our segments. EBITDA, however, is not a measure of our
liquidity or financial performance under GAAP and should not be
considered as an alternative to net income (loss), income (loss)
from operations, or any other performance measure derived in
accordance with GAAP or as an alternative to cash flow from
operating activities as a measure of our liquidity. The use of
EBITDA instead of net income (loss) or segment income (loss) has
limitations as an analytical tool, including the inability to
determine profitability; the exclusion of interest and associated
significant cash requirements; and the exclusion of depreciation,
amortization, and depletion, which represent significant and
unavoidable operating costs, given the level of our indebtedness
and the capital expenditures needed to maintain our businesses.
Management compensates for these limitations by relying on our GAAP
results. Our measures of EBITDA are not necessarily comparable to
other similarly titled captions of other companies due to potential
inconsistencies in the methods of calculation. 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. 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 (Loss) (unaudited, in thousands,
except share and per-share data) Three Months Ended
------------------------------------ December 31 ----------------
September 30, 2009 2008 2009 ---- ---- ---- Sales Trade $481,853
$566,671 $498,812 Related parties 8,422 24,448 9,453 ----- ------
----- 490,275 591,119 508,265 ------- ------- ------- Costs and
expenses Materials, labor, and other operating expenses 395,455
490,576 401,607 Fiber costs from related parties 11,897 7,771
10,325 Depreciation, amortization, and depletion 33,720 33,126
32,916 Selling and distribution expenses 14,130 13,715 13,588
General and administrative expenses 14,373 7,556 12,813 St. Helens
mill restructuring (378) 29,780 1,402 Alternative fuel mixture
credits, net (72,698) - (59,572) Other (income) expense, net (378)
(2,820) 1,710 ---- ------ ----- 396,121 579,704 414,789 -------
------- ------- Income from operations 94,154 11,415 93,476 ------
------ ------ Foreign exchange gain (loss) 563 (3,185) 1,597 Change
in fair value of interest rate derivatives (52) (683) 125 Loss on
extinguishment of debt (44,102) - - Interest expense (18,284)
(26,156) (21,436) Interest income 92 94 130 --- --- --- (61,783)
(29,930) (19,584) ------- ------- ------- Income (loss) before
income taxes 32,371 (18,515) 73,892 Income tax (provision) benefit
23,349 3,030 (25,737) ------ ----- ------- Net income (loss)
$55,720 $(15,485) $48,155 ======= ======== ======= Weighted average
common shares outstanding: Basic 79,130,897 77,260,274 78,634,920
Diluted 84,232,429 77,260,274 84,240,582 Net income (loss) per
common share: Basic $0.70 $(0.20) $0.61 Diluted $0.66 $(0.20) $0.57
Segment Information (unaudited, in thousands) Three Months Ended
--------------------------------- December 31 --------------
September 30, 2009 2008 2009 ---- ---- ---- Segment sales Paper
$345,602 $389,644 $365,963 Packaging 150,574 213,788 150,462
Intersegment eliminations and other (5,901) (12,313) (8,160) ------
------- ------ $490,275 $591,119 $508,265 ======== ========
======== Segment income (loss) Paper (1) $75,112 $(12,303) $78,272
Packaging (1) 23,344 26,075 22,290 Corporate and Other (1) (3,739)
(5,542) (5,489) ------ ------ ------ 94,717 8,230 95,073 ------
----- ------ Change in fair value of interest rate derivatives (52)
(683) 125 Loss on extinguishment of debt (44,102) - - Interest
expense (18,284) (26,156) (21,436) Interest income 92 94 130 ---
--- --- Income (loss) before income taxes $32,371 $(18,515) $73,892
======= ======== ======= EBITDA (a) Paper (1) $96,637 $9,222
$99,443 Packaging (1) 34,466 36,660 32,966 Corporate and
Other(1)(2) (46,768) (4,526) (4,420) ------- ------ ------ $84,335
$41,356 $127,989 ======= ======= ======== (1) The three months
ended December 31, 2009, and September 30, 2009, included $50.1
million and $42.9 million of income recorded in the Paper segment,
$22.2 million and $19.4 million of income recorded in the Packaging
segment, and $0.4 million of income and $2.7 million of expense
recorded in the Corporate and Other segment relating to alternative
fuel mixture credits, respectively. These amounts are net of fees
and expenses and before taxes. (2) The three months ended December
31, 2009, includes $44.1 million of loss on extinguishment of debt.
Boise Inc. Consolidated Statements of Income (Loss) (in thousands,
except share and per-share data) Boise Inc. Predecessor
---------------- ----------- Year Ended January 1 December 31
Through ---------------- February 21, 2009 2008 2008 ---- ---- ----
Sales Trade $1,935,410 $1,990,207 $258,430 Related parties 42,782
80,425 101,490 ------ ------ ------- 1,978,192 2,070,632 359,920
--------- --------- ------- Costs and expenses Materials, labor,
and other operating expenses 1,596,214 1,756,826 313,931 Fiber
costs from related parties 36,858 54,628 7,662 Depreciation,
amortization, and depletion 131,500 109,988 477 Selling and
distribution expenses 55,524 48,278 9,097 General and
administrative expenses 50,250 34,258 6,606 St. Helens mill
restructuring 5,805 29,780 - Alternative fuel mixture credits, net
(207,607) - - Other (income) expense, net 4,005 (2,980) (989) -----
------ ---- 1,672,549 2,030,778 336,784 --------- --------- -------
Income from operations 305,643 39,854 23,136 ------- ------ ------
Foreign exchange gain (loss) 2,639 (4,696) 54 Change in fair value
of interest rate derivatives 568 (479) - Loss on extinguishment of
debt (44,102) - - Interest expense (83,263) (91,220) (2) Interest
income 367 2,246 161 --- ----- --- (123,791) (94,149) 213 --------
------- --- Income (loss) before income taxes 181,852 (54,295)
23,349 Income tax (provision) benefit (28,010) 8,772 (563) -------
----- ---- Net income (loss) $153,842 $(45,523) $22,786 ========
======== ======= Weighted average common shares outstanding: Basic
78,354,946 73,635,665 - Diluted 83,080,979 73,635,665 - Net income
(loss) per common share: Basic $1.96 $(0.62) $- Diluted $1.85
$(0.62) $- Segment Information (in thousands) Boise Inc.
Predecessor ---------------- ----------------- Year Ended January 1
Through December 31 February 21, ---------------- 2009 2008 2008
---- ---- ---- Segment sales Paper $1,419,961 $1,403,698 $253,508
Packaging 588,405 703,705 113,485 Intersegment eliminations and
other (30,174) (36,771) (7,073) ------- ------- ------ $1,978,192
$2,070,632 $359,920 ========== ========== ======== Segment income
(loss) Paper (1) $262,665 $32,685 $20,718 Packaging (1) 67,089
21,104 5,685 Corporate and Other (1) (21,472) (18,631) (3,213)
------- ------- ------ 308,282 35,158 23,190 ------- ------ ------
Change in fair value of interest rate derivatives 568 (479) - Loss
on extinguishment of debt (44,102) - - Interest expense (83,263)
(91,220) (2) Interest income 367 2,246 161 --- ----- --- Income
(loss) before income taxes $181,852 $(54,295) $23,349 ========
======== ======= EBITDA (a) Paper (1) $347,806 $104,346 $21,066
Packaging (1) 109,321 56,171 5,738 Corporate and Other (1) (2)
(61,447) (15,371) (3,137) ------- ------- ------ $395,680 $145,146
$23,667 ======== ======== ======= (1) The year ended December 31,
2009, included $149.9 million of income recorded in the Paper
segment, $61.6 million of income recorded in the Packaging segment,
and $3.9 million of expenses recorded in the Corporate and Other
segment relating to alternative fuel mixture credits. These amounts
are net of fees and expenses and before taxes. (2) The year ended
December 31, 2009, includes $44.1 million of loss on extinguishment
of debt. Boise Inc. Consolidated Balance Sheets (in thousands)
December 31, 2009 December 31, 2008 -----------------
----------------- ASSETS Current Cash and cash equivalents $69,393
$22,518 Short-term investments 10,023 - Receivables Trade, less
allowances of $839 and $961 185,110 220,204 Related parties 2,056
1,796 Other (1) 62,410 4,937 Inventories 252,173 335,004 Deferred
income taxes - 5,318 Prepaid and other 4,819 6,289 ----- -----
585,984 596,066 ------- ------- Property Property and equipment,
net 1,205,679 1,262,810 Fiber farms and deposits 17,094 14,651
------ ------ 1,222,773 1,277,461 --------- --------- Deferred
financing costs 47,369 72,570 Intangible assets, net 32,358 35,075
Other assets 7,306 7,114 ----- ----- Total assets $1,895,790
$1,988,286 ========== ========== (1) December 31, 2009, includes a
$56.6 million receivable for alternative fuel mixture credits.
Boise Inc. Consolidated Balance Sheets (continued) (in thousands,
except share and per-share data) December 31, 2009 December 31,
2008 ----------------- ----------------- LIABILITIES AND
STOCKHOLDERS' EQUITY Current Current portion of long-term debt
$30,711 $25,822 Income taxes payable 240 841 Accounts payable Trade
172,518 177,157 Related parties 2,598 3,107 Accrued liabilities
Compensation and benefits 67,948 44,488 Interest payable 4,946 184
Other 23,735 17,402 ------ ------ 302,696 269,001 ------- -------
Debt Long-term debt, less current portion 785,216 1,011,628 Notes
payable - 66,606 - ------ 785,216 1,078,234 ------- --------- Other
Deferred income taxes 32,253 8,907 Compensation and benefits
123,889 149,691 Other long-term liabilities 30,801 33,007 ------
------ 186,943 191,605 ------- ------- Commitments and contingent
liabilities Stockholders' Equity Preferred stock, $.0001 par value
per share: 1,000,000 shares authorized; none issued - - Common
stock, $.0001 par value per share: 250,000,000 shares authorized;
84,418,691 shares and 79,716,130 shares issued and outstanding 8 8
Additional paid-in capital 578,669 575,151 Accumulated other
comprehensive income (loss) (71,553) (85,682) Retained earnings
(accumulated deficit) 113,811 (40,031) ------- ------- Total
stockholders' equity 620,935 449,446 ------- ------- Total
liabilities and stockholders' equity $1,895,790 $1,988,286
========== ========== Boise Inc. Consolidated Statements of Cash
Flows (in thousands) Boise Inc. Predecessor ----------
----------------- Year Ended January 1 Through December 31 February
21, ---------------- 2009 2008 2008 ---- ---- ---- Cash provided by
(used for) operations Net income (loss) $153,842 $(45,523) $22,786
Items in net income (loss) not using (providing) cash Depreciation,
depletion, and amortization of deferred financing costs and other
144,079 119,933 477 Share-based compensation expense 3,518 3,096 -
Related-party interest expense - 2,760 - Notes payable interest
expense 9,000 5,512 - Pension and other postretirement benefit
expense 7,376 8,388 1,826 Deferred income taxes 27,709 (9,363) 11
Change in fair value of energy derivatives (5,877) 7,445 (37)
Change in fair value of interest rate derivatives (568) 479 - St.
Helens mill restructuring - 35,998 - (Gain) loss on sales of
assets, net 514 - (943) Other (2,639) 4,696 (54) Loss on
extinguishment of debt 44,102 - - Decrease (increase) in working
capital, net of acquisitions Receivables (18,579) 25,296 (23,522)
Inventories 83,037 (28,950) 5,343 Prepaid expenses 1,470 (1,044)
875 Accounts payable and accrued liabilities 25,710 (17,801)
(10,718) Current and deferred income taxes (372) (1,057) 335
Pension and other postretirement benefit payments (13,001) (636)
(1,826) Other (609) (1,483) 2,326 ---- ------ ----- Cash provided
by (used for) operations 458,712 107,746 (3,121) ------- -------
------ Cash provided by (used for) investment Acquisitions of
businesses and facilities (543) (1,216,459) - Cash released from
(held in) trust, net - 403,989 - Expenditures for property and
equipment (77,145) (90,597) (10,168) Purchases of short-term
investments (21,643) - - Maturities of short-term investments
11,615 - - Sales of assets 1,031 394 17,662 Other 2,168 (5,703) 863
----- ------ --- Cash provided by (used for) investment (84,517)
(908,376) 8,357 ------- -------- ----- Cash provided by (used for)
financing Issuances of long-term debt 310,000 1,125,700 - Payments
of long-term debt (531,523) (88,250) - Cash used for extinguishment
of debt (39,717) - - Payments of notes payable (52,924) - -
Payments to stockholders for exercise of conversion rights -
(120,170) - Payments of deferred financing fees (13,156) (81,898) -
Payments of deferred underwriters fees - (12,420) - Net equity
transactions with related parties - - (5,237) --- --- ------ Cash
provided by (used for) financing (327,320) 822,962 (5,237) --------
------- ------ Increase (decrease) in cash and cash equivalents
46,875 22,332 (1) Balance at beginning of the period 22,518 186 8
------ --- --- Balance at end of the period $69,393 $22,518 $7
======= ======= === Summary Notes to Consolidated Financial
Statements and Segment Information The Consolidated Statements of
Income (Loss), 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 10K. Net income
(loss) for all periods presented involved estimates and accruals.
On February 22, 2008, Aldabra 2 Acquisition Corp. completed the
acquisition (the Acquisition) of Boise White Paper, L.L.C., Boise
Packaging & Newsprint, L.L.C., Boise Cascade Transportation
Holdings Corp. (collectively, the Paper Group), and other assets
and liabilities related to the operation of the paper, packaging
and newsprint, and transportation businesses of the Paper Group and
part of the headquarters operations of Boise Cascade, L.L.C. (Boise
Cascade). Subsequent to the Acquisition, Aldabra 2 Acquisition
Corp. changed its name to Boise Inc. The acquired business is
referred to as the "Predecessor." The accompanying Consolidated
Statement of Income (Loss) and Consolidated Statement of Cash Flows
for the year ended December 31, 2008, include the activities of
Aldabra 2 Acquisition Corp. prior to the Acquisition and the
operations of the acquired businesses from February 22, 2008,
through December 31, 2008. The Predecessor Consolidated Statement
of Income (Loss) and Consolidated Statement of Cash Flows for the
period of January 1 through February 21, 2008, are presented for
comparative purposes. Boise Inc. operates its business in three
reportable segments: Paper, Packaging, and Corporate and Other
(support services). Boise Inc. manufactures commodity and premium
office papers, a range of packaging papers, including label and
release papers, flexible packaging papers, and printing and
converting papers. Boise Inc. also manufactures corrugated
containers, containerboard, newsprint, and market pulp. (a) EBITDA
represents income (loss) 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 Boise Inc. for
the three months ended December 31, 2009 and 2008, and the three
months ended September 30, 2009 (unaudited, in thousands): Three
Months Ended ------------------------------- December 31 September
30, -------------- 2009 2008 2009 ---- ---- ---- Net income (loss)
$55,720 $(15,485) $48,155 Change in fair value of interest rate
derivatives 52 683 (125) Interest expense 18,284 26,156 21,436
Interest income (92) (94) (130) Income tax provision (benefit)
(23,349) (3,030) 25,737 Depreciation, amortization, and depletion
33,720 33,126 32,916 ------ ------ ------ EBITDA $84,335 $41,356
$127,989 ======= ======= ======== The following table reconciles
net income (loss) to EBITDA for Boise Inc. for the year ended
December 31, 2009 and 2008, and for the Predecessor period of
January 1 through February 21, 2008 (unaudited, in thousands):
Boise Inc. Predecessor -------------- ----------------- Year Ended
January 1 Through December 31 February 21, -------------- 2009 2008
2008 ---- ---- ---- Net income (loss) $153,842 $(45,523) $22,786
Change in fair value of interest rate derivatives (568) 479 -
Interest expense 83,263 91,220 2 Interest income (367) (2,246)
(161) Income tax provision (benefit) 28,010 (8,772) 563
Depreciation, amortization, and depletion 131,500 109,988 477
------- ------- --- EBITDA $395,680 $145,146 $23,667 ========
======== ======= The following table reconciles EBITDA to EBITDA
excluding special items for Boise Inc. for the three months ended
December 31, 2009 and 2008, and the three months ended September
30, 2009 (unaudited, in thousands): Three Months Ended
----------------------------- December 31 September 30, -----------
2009 2008 2009 ---- ---- ---- EBITDA $84,335 $41,356 $127,989 St.
Helens mill restructuring (a) (378) 37,568 1,402 Impact of energy
hedges (976) (26) (3,624) Alternative fuel mixture credits (b)
(72,698) - (59,572) Loss on extinguishment of debt 44,102 - - Gain
on changes in supplemental pension plans - (2,914) - --- ------ ---
EBITDA excluding special items $54,385 $75,984 $66,195 =======
======= ======= (a) In November 2008, we announced the
restructuring of our St. Helens, Oregon, paper mill. Of the $37.6
million in restructuring charges during the three months ended
December 31, 2008, $29.8 million is included in "St. Helens mill
restructuring" and $7.8 million related to inventory write-downs is
included in "Materials, labor, and other operating expenses."
During the three months ended September 30, 2009, we recorded $1.4
million in additional restructuring charges in "St. Helens mill
restructuring," and during the three months ended December 31,
2009, we recorded a net $0.4 million reduction to our restructuring
charges. (b) During the three months ended December 31, 2009, and
September 30, 2009, we recorded $72.7 million and $59.6 million,
respectively, of alternative fuel mixture credits, net of
associated fees and expenses and before taxes. We recorded these
amounts in "Alternative fuel mixture credits, net" in our
Consolidated Statement of Income (Loss). At December 31, 2009, we
had $56.6 million recorded in "Receivables, other" related to these
credits. The following table reconciles EBITDA to EBITDA excluding
special items for Boise Inc. for the years ended December 31, 2009
and 2008. The table also reconciles the Predecessor period of
January 1 through February 21, 2008, and the combined year ended
December 31, 2008 (unaudited, in thousands): Boise Inc. Predecessor
Combined -------------- ----------------- ----------- Year Ended
January 1 Through Year Ended December 31 February 21, December 31,
-------------- 2009 2008 2008 2008 ---- ---- ---- ---- EBITDA
$395,680 $145,146 $23,667 $168,813 St. Helens mill restructuring
(a) 5,805 37,568 - 37,568 Impact of energy hedges (5,877) 7,445
(37) 7,408 Alternative fuel mixture credits (b) (207,607) - - -
Loss of extinguishment of debt 44,102 - - - Hurricane losses -
5,482 - 5,482 Gain on changes in supplemental pension plans -
(2,914) - (2,914) Inventory purchase accounting expense - 10,259 -
10,259 Impact of DeRidder outage - 19,776 732 20,508 ---- ------
---- ------ EBITDA excluding special items $232,103 $222,762
$24,362 $247,124 ======== ======== ======= ======== (a) In November
2008, we announced the restructuring of our St. Helens, Oregon,
paper mill. Of the $37.6 million in restructuring charges during
the year ended December 31, 2008, $29.8 million is included in "St.
Helens mill restructuring" and $7.8 million related to inventory
write-downs is included in "Materials, labor, and other operating
expenses." During the year ended December 31, 2009, we recorded
$5.8 million of net restructuring charges in "St. Helens mill
restructuring." (b) During the year ended December 31, 2009, we
recorded $207.6 million of alternative fuel mixture credits, net of
associated fees and expenses and before taxes. We recorded these
amounts in "Alternative fuel mixture credits, net" in our
Consolidated Statement of Income (Loss). At December 31, 2009, we
had $56.6 million recorded in "Receivables, other" related to these
credits. The following table reconciles net income (loss) to net
income (loss) excluding special items and presents diluted earnings
per share excluding special items for the three months ended
December 31, 2009 and 2008, the three months ended September 30,
2009, and the years ended December 31, 2009 and 2008. The table
also reconciles the Predecessor period of January 1 through
February 21, 2008, and the combined year ended December 31, 2008
(unaudited, in thousands): Boise Inc.
-------------------------------------------------------- Three
Three Three Months Months Months Year Year Ended Ended Ended Ended
Ended December December September December December 31, 31, 30, 31,
31, 2009 2008 2009 2009 2008 ---- ---- ---- ---- ---- Net income
(loss) $55,720 $(15,485) $48,155 $153,842 $(45,523) St. Helens mill
restructuring (378) 37,568 1,402 5,805 37,568 Impact of energy
hedges (976) (26) (3,624) (5,877) 7,445 Alternative fuel mixture
credits (72,698) - (59,572) (207,607) - Loss on extinguishment of
debt 44,102 - - 44,102 - Hurricane losses - - - - 5,482 Gain on
changes in supplemental pension plans - (2,914) - - (2,914)
Inventory revaluation expense - - - - 10,259 Impact of DeRidder
outage - - - - 19,776 Tax impact of special items at 38.7% (a)
11,591 (13,401) 23,914 63,304 (30,037) ------ ------- ------ ------
------- Reversal of income tax valuation allowances (b) (33,180) -
- (33,180) - ------- ---- ---- ------- ---- Net income (loss)
excluding special items $4,181 $5,742 $10,275 $20,389 $2,056 ======
====== ======= ======= ====== Weighted average common shares
outstanding: diluted 84,232,429 77,260,274 84,240,582 83,080,979
73,635,665 Net income (loss) excluding special items per diluted
share $0.05 $0.07 $0.12 $0.25 $0.03 (a) Special items are tax
effected in the aggregate at an assumed combined federal and state
statutory rate of 38.7%. During the three months ended December 31,
2009, we reversed income tax valuation allowances. The following
table reconciles total debt to net total debt at December 31, 2009
and 2008, and September 30, 2009 (unaudited, in thousands): Boise
Inc. ----------------------------------------- December 31,
December 31, September 30, 2009 2008 2009 ---- ---- ---- Current
portion of long-term debt $30,711 $25,822 $22,235 Long-term debt,
less current portion and notes payable 785,216 1,011,628 932,517
Notes payable - 66,606 74,788 - ------ ------ Total debt 815,927
1,104,056 1,029,540 Less cash and cash equivalents and short-term
investments (79,416) (22,518) (247,614) ------- ------- --------
Net total debt $736,511 $1,081,538 $781,926 ======== ==========
======== DATASOURCE: Boise Inc. CONTACT: Media, Virginia Aulin,
+1-208-384-7837, or Investors, Jason Bowman, +1-208-384-7456, both
of Boise Inc. Web Site: http://www.boiseinc.com/
Copyright