EX-99.2 4 a03-4260_1ex99d2.htm EX-99.2

Financial Highlights   Boise and Subsidiaries

 

 

 

 

 

 

 

 

 

2003

 

 

 

2000

 

2001

 

2002

 

First
Quarter

 

Second
Quarter

 

Third
Quarter

 

Fourth
Quarter

 

Year

 

 

 

(millions, except per-share amounts)

 

Sales and Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

7,806.7

 

$

7,422.2

 

$

7,412.3

 

$

1,853.2

 

$

1,929.0

 

$

2,110.6

 

 

 

$

5,892.8

 

Income from operations

 

444.0

 

81.1

 

118.3

 

1.7

 

22.7

 

76.7

 

 

 

101.1

 

Net income (loss) before cumulative effect of accounting changes

 

$

178.6

 

$

(42.5

)

$

11.3

 

$

(18.7

)

$

(4.0

)

$

32.9

 

 

 

$

10.2

 

Cumulative effect of accounting changes, net of income tax

 

—

 

—

 

—

 

(8.8

)

—

 

—

 

 

 

(8.8

)

Net income (loss)

 

$

178.6

 

$

(42.5

)

$

11.3

 

$

(27.5

)

$

(4.0

)

$

32.9

 

 

 

$

1.4

 

Net income (loss) per  common share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted before cumulative effect of accounting changes

 

$

2.73

 

$

(.96

)

$

(.03

)

$

(.38

)

$

(.12

)

$

.48

 

 

 

$

.01

 

Cumulative effect of accounting changes

 

—

 

—

 

—

 

(.15

)

—

 

—

 

 

 

(.15

)

Diluted

 

$

2.73

 

$

(.96

)

$

(.03

)

$

(.53

)

$

(.12

)

$

.48

 

 

 

$

(.14

)

Cash dividends paid per common share

 

$

.60

 

$

.60

 

$

.60

 

$

.15

 

$

.15

 

$

.15

 

 

 

$

.45

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Condition

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

485.8

 

380.0

 

266.2

 

48.5

 

69.4

 

44.5

 

 

 

162.4

 

Total assets

 

5,266.9

 

4,934.0

 

4,947.4

 

4,970.9

 

4,989.9

 

5,066.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long-term debt, less current portion

 

$

1,714.8

 

$

1,062.9

 

$

1,387.4

 

$

1,472.7

 

$

1,494.4

 

$

1,517.1

 

 

 

 

 

Current portion of long-term debt and short-term borrowings

 

93.3

 

440.0

 

153.7

 

105.5

 

76.5

 

85.1

 

 

 

 

 

Company-obligated mandatorily redeemable securities of subsidiary trust holding solely debentures of parent

 

—

 

—

 

—

 

—

 

—

 

172.5

 

 

 

 

 

Guarantee of ESOP debt

 

107.9

 

80.9

 

51.4

 

51.4

 

40.5

 

40.5

 

 

 

 

 

Total debt

 

$

1,916.0

 

$

1,583.8

 

$

1,592.5

 

$

1,629.6

 

$

1,611.4

 

$

1,815.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

$

1,757.0

 

$

1,578.4

 

$

1,399.5

 

$

1,372.1

 

$

1,384.2

 

$

1,411.4

 

 

 

 

 

Shareholders’ equity per common share

 

$

28.85

 

$

25.10

 

$

21.59

 

$

21.17

 

$

21.23

 

$

21.26

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financial Ratios

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on sales

 

2.3

%

(.6

)%

.2

%

(1.5

)%

(.2

)%

1.6

%

 

 

0

%

Debt to equity

 

1.09:1

 

1.00:1

 

1.14:1

 

1.19:1

 

1.16:1

 

1.29:1

 

 

 

 

 

Debt to total capitalization

 

52.0

%

47.5

%

50.3

%

51.3

%

50.9

%

56.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Information

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Effective tax (provision) benefit rate

 

(39.0%

)

11.5

%

NM

(1)

35.9

%

34.0

%

(27.6

)%

 

 

(13.2

)%

Number of common shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

outstanding at the end of the period (thousands)

 

57,337

 

58,062

 

58,284

 

58,292

 

58,314

 

59,549

 

 

 

 

 

Average number of common shares (thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

57,288

 

57,680

 

58,216

 

58,289

 

58,300

 

58,411

 

 

 

58,334

 

Diluted(2)

 

61,413

 

61,797

 

62,090

 

61,880

 

61,844

 

62,697

 

 

 

62,143

 

Common stock price

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

High

 

$

43.94

 

$

38.00

 

$

38.81

 

$

28.15

 

$

26.30

 

$

29.20

 

 

 

 

 

Low

 

$

21.75

 

$

26.99

 

$

19.61

 

$

20.72

 

$

21.48

 

$

21.48

 

 

 

 

 

Close

 

$

33.63

 

$

34.01

 

$

25.22

 

$

21.85

 

$

23.90

 

$

27.60

 

 

 

 

 

 

(1)          NM = not meaningful.

(2)          For the first and second quarters of 2003, the nine months ended September 30, 2003, and the years ended December 31, 2001 and 2002, the computation of diluted net loss per share was antidilutive; accordingly, diluted net loss per share was calculated using the average basic shares outstanding.

 

1

 

Summary of Operations  Boise and Subsidiaries

 

 

 

2002

 

Quarterly Results by Segment (Unaudited)(1)

 

First
Quarter

 

Second
Quarter

 

Third
Quarter

 

Fourth
Quarter

 

Year

 

 

 

(millions, except per-share amounts)

 

Sales by Segment

 

 

 

 

 

 

 

 

 

 

 

Boise Office Solutions

 

$

884.5

 

$

855.5

 

$

899.9

 

$

905.9

 

$

3,545.8

 

Boise Building Solutions

 

560.2

 

669.9

 

671.5

 

568.2

 

2,469.7

 

Boise Paper Solutions

 

456.0

 

481.6

 

485.2

 

455.3

 

1,878.0

 

Other

 

18.3

 

19.4

 

19.4

 

18.9

 

76.0

 

 

 

1,919.0

 

2,026.4

 

2,075.9

 

1,948.3

 

7,969.5

 

Intersegment eliminations

 

(130.8

)

(138.4

)

(140.7

)

(147.4

)

(557.2

)

Trade sales

 

$

1,788.2

 

$

1,888.0

 

$

1,935.3

 

$

1,800.8

 

$

7,412.3

 

Income (Loss) by Segment

 

 

 

 

 

 

 

 

 

 

 

Boise Office Solutions

 

$

37.4

 

$

23.4

 

$

29.8

 

$

32.4

 

$

123.0

 

Boise Building Solutions

 

8.8

 

14.0

 

14.5

 

2.3

 

39.7

 

Boise Paper Solutions

 

(10.8

)

8.8

 

17.2

 

23.4

 

38.6

 

Corporate and Other

 

(12.8

)

(37.9

)

(15.9

)

(15.3

)

(81.8

)

 

 

22.6

 

8.4

 

45.6

 

42.9

 

119.5

 

Interest expense

 

(30.0

)

(30.0

)

(28.7

)

(29.7

)

(118.5

)

Income (loss) before income taxes and minority interest

 

(7.4

)

(21.6

)

16.9

 

13.2

 

1.0

 

Income tax (provision) benefit

 

2.8

 

26.9

 

(6.3

)

(4.9

)

18.4

 

Income (loss) before minority interest

 

(4.6

)

5.3

 

10.5

 

8.2

 

19.4

 

Minority interest, net of income tax

 

(2.0

)

(2.0

)

(2.0

)

(2.0

)

(8.1

)

Net income (loss)

 

$

(6.6

)

$

3.2

 

$

8.5

 

$

6.2

 

$

11.3

 

Net income (loss) per common share

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

$

(.17

)

$

.00

 

$

.09

 

$

.05

 

$

(.03

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2003

 

 

 

First
Quarter

 

Second
Quarter

 

Third
Quarter

 

Fourth
Quarter

 

Year

 

 

 

(millions, except per-share amounts)

 

Sales by Segment

 

 

 

 

 

 

 

 

 

 

 

Boise Office Solutions

 

$

938.3

 

$

904.9

 

$

934.1

 

 

 

$

2,777.3

 

Boise Building Solutions

 

574.6

 

692.8

 

828.1

 

 

 

2,095.6

 

Boise Paper Solutions

 

468.2

 

459.4

 

474.2

 

 

 

1,401.8

 

Other

 

19.4

 

18.8

 

20.6

 

 

 

58.8

 

 

 

2,000.5

 

2,075.9

 

2,256.9

 

 

 

6,333.4

 

Intersegment eliminations

 

(147.3

)

(146.9

)

(146.3

)

 

 

(440.5

)

Trade sales

 

$

1,853.2

 

$

1,929.0

 

$

2,110.6

 

 

 

$

5,892.8

 

Income (Loss) by Segment

 

 

 

 

 

 

 

 

 

 

 

Boise Office Solutions

 

$

20.7

 

$

23.9

 

$

31.0

 

 

 

$

75.5

 

Boise Building Solutions

 

(8.5

)

9.8

 

56.4

 

 

 

57.8

 

Boise Paper Solutions

 

(0.7

)

1.0

 

0.2

 

 

 

0.5

 

Corporate and Other

 

(8.7

)

(9.9

)

(10.5

)

 

 

(29.1

)

 

 

2.8

 

24.9

 

77.1

 

 

 

104.7

 

Interest expense

 

(28.9

)

(27.8

)

(31.7

)

 

 

(88.3

)

Income (loss) before income taxes, minority interest, and cumulative effect of accounting changes

 

(26.1

)

(2.9

)

45.4

 

 

 

16.4

 

Income tax (provision) benefit

 

9.4

 

1.0

 

(12.5

)

 

 

(2.2

)

Income (loss) before minority interest and cumulative effect of accounting changes

 

(16.7

)

(1.9

)

32.9

 

 

 

14.2

 

Minority interest, net of income tax

 

(2.0

)

(2.0

)

—

 

 

 

(4.0

)

Income (loss) before cumulative effect of accounting changes

 

(18.7

)

(4.0

)

32.9

 

 

 

10.2

 

Cumulative effect of accounting changes, net of income tax

 

(8.8

)

—

 

—

 

 

 

(8.8

)

Net income (loss)

 

$

(27.5

)

$

(4.0

)

$

32.9

 

 

 

$

1.4

 

Net income (loss) per common share

 

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) before cumulative effect of accounting changes

 

$

(.38

)

$

(.12

)

$

.48

 

 

 

$

.01

 

Cumulative effect of accounting changes

 

(.15

)

—

 

—

 

 

 

(.15

)

Diluted

 

$

(.53

)

$

(.12

)

$

.48

 

 

 

$

(.14

)

 

(1) Columns may not add due to rounding.

 

2

 

Statistical Review / 2002

 

 

 

2002

 

 

 

First
Quarter

 

Second
Quarter

 

Third
Quarter

 

Fourth
Quarter

 

Year

 

 

 

 

 

 

 

 

 

 

 

 

 

Boise Office Solutions

 

 

 

 

 

 

 

 

 

 

 

Sales by Product Line (millions)

 

 

 

 

 

 

 

 

 

 

 

Office supplies and paper

 

$

549

 

$

531

 

$

545

 

$

556

 

$

2,181

 

Technology products

 

244

 

239

 

263

 

256

 

1,002

 

Office furniture

 

91

 

86

 

92

 

94

 

363

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales by Geography (millions)

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

686

 

$

665

 

$

707

 

$

701

 

$

2,759

 

International

 

198

 

191

 

193

 

205

 

787

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales Growth

 

 

 

 

 

 

 

 

 

 

 

Sales growth

 

(9

)%

(1

)%

6

%

6

%

0

%

Same-location sales growth

 

(8

)%

(1

)%

6

%

5

%

0

%

 

 

 

 

 

 

 

 

 

 

 

 

Margins (percentage of sales)

 

 

 

 

 

 

 

 

 

 

 

Gross profit margin

 

23.6

%

23.1

%

22.4

%

23.5

%

23.1

%

Operating profit

 

4.2

%

2.7

%

3.3

%

3.6

%

3.5

%

 

 

 

 

 

 

 

 

 

 

 

 

Boise Building Solutions

 

 

 

 

 

 

 

 

 

 

 

Sales Volumes

 

 

 

 

 

 

 

 

 

 

 

Plywood (thousand square feet) (3/8” basis)

 

440,525

 

462,648

 

460,952

 

424,078

 

1,788,203

 

OSB (thousand square feet) (3/8” basis) (1)

 

100,161

 

98,273

 

107,176

 

111,076

 

416,686

 

Particleboard (thousand square feet) (3/4” basis)

 

49,749

 

51,182

 

47,617

 

40,675

 

189,223

 

Lumber (thousand board feet)

 

95,911

 

108,455

 

99,858

 

91,057

 

395,281

 

LVL (hundred cubic feet)

 

17,895

 

20,844

 

20,879

 

17,925

 

77,543

 

I-joists (thousand equivalent lineal feet)

 

34,995

 

47,102

 

46,954

 

36,714

 

165,765

 

Engineered wood products (millions)

 

$

60

 

$

76

 

$

77

 

$

61

 

$

274

 

Building materials distribution (millions)

 

$

375

 

$

464

 

$

470

 

$

387

 

$

1,696

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Prices (average net selling prices)

 

 

 

 

 

 

 

 

 

 

 

Plywood (thousand square feet) (3/8” basis)

 

$

231

 

$

238

 

$

227

 

$

220

 

$

229

 

OSB (thousand square feet) (3/8” basis)

 

131

 

136

 

127

 

128

 

130

 

Particleboard (thousand square feet) (3/4” basis)

 

230

 

248

 

254

 

223

 

239

 

Lumber (thousand board feet)

 

481

 

465

 

470

 

446

 

466

 

LVL (hundred cubic feet)

 

1,491

 

1,485

 

1,498

 

1,454

 

1,483

 

I-joists (thousand equivalent lineal feet)

 

896

 

886

 

890

 

872

 

886

 

 

 

 

 

 

 

 

 

 

 

 

 

Boise Paper Solutions

 

 

 

 

 

 

 

 

 

 

 

Sales Volumes (thousands of short tons)

 

 

 

 

 

 

 

 

 

 

 

Uncoated free sheet

 

355

 

370

 

364

 

336

 

1,425

 

Containerboard

 

160

 

167

 

168

 

159

 

654

 

Newsprint

 

84

 

111

 

110

 

101

 

406

 

Other

 

49

 

62

 

37

 

31

 

179

 

 

 

648

 

710

 

679

 

627

 

2,664

 

 

 

 

 

 

 

 

 

 

 

 

 

Corrugated containers (millions of square feet)

 

1,061

 

1,065

 

1,205

 

1,132

 

4,463

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Prices (average net selling prices per short ton)

 

 

 

 

 

 

 

 

 

 

 

Uncoated free sheet

 

$

712

 

$

712

 

$

722

 

$

746

 

$

722

 

Containerboard

 

327

 

332

 

351

 

361

 

343

 

Newsprint

 

368

 

349

 

367

 

371

 

363

 

 

(1)  Includes 100% of the sales volume of Voyageur Panel, of which we own 47%.

 

3

 

Statistical Review / 2003

 

 

 

2003

 

 

 

First
Quarter

 

Second
Quarter

 

Third
Quarter

 

Fourth
Quarter

 

Year

 

 

 

 

 

 

 

 

 

 

 

 

 

Boise Office Solutions

 

 

 

 

 

 

 

 

 

 

 

Sales by Product Line (millions)

 

 

 

 

 

 

 

 

 

 

 

Office supplies and paper

 

$

567

 

$

539

 

$

555

 

 

 

 

 

Technology products

 

277

 

275

 

280

 

 

 

 

 

Office furniture

 

94

 

91

 

99

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales by Geography (millions)

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

709

 

$

682

 

712

 

 

 

 

 

International

 

229

 

223

 

222

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales Growth

 

 

 

 

 

 

 

 

 

 

 

Sales growth

 

6

%

6

%

4

%

 

 

 

 

Same-location sales growth

 

6

%

6

%

4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Margins (percentage of sales)

 

 

 

 

 

 

 

 

 

 

 

Gross profit margin

 

23.8

%

23.8

%

24.2

%

 

 

 

 

Operating profit

 

2.2

%

2.6

%

3.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Boise Building Solutions

 

 

 

 

 

 

 

 

 

 

 

Sales Volumes

 

 

 

 

 

 

 

 

 

 

 

Plywood (thousand square feet) (3/8” basis)

 

466,537

 

476,896

 

499,323

 

 

 

 

 

OSB (thousand square feet) (3/8” basis) (1)

 

106,851

 

112,652

 

111,775

 

 

 

 

 

Particleboard (thousand square feet) (3/4” basis)

 

41,192

 

38,609

 

36,524

 

 

 

 

 

Lumber (thousand board feet)

 

93,524

 

93,113

 

90,522

 

 

 

 

 

LVL (hundred cubic feet)

 

20,685

 

25,063

 

28,431

 

 

 

 

 

I-joists (thousand equivalent lineal feet)

 

40,534

 

53,271

 

60,275

 

 

 

 

 

Engineered wood products (millions)

 

$

68

 

$

85

 

$

96

 

 

 

 

 

Building materials distribution (millions)

 

$

391

 

$

505

 

$

603

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Prices (average net selling prices)

 

 

 

 

 

 

 

 

 

 

 

Plywood (thousand square feet) (3/8” basis)

 

$

220

 

$

228

 

$

291

 

 

 

 

 

OSB (thousand square feet) (3/8” basis)

 

141

 

165

 

258

 

 

 

 

 

Particleboard (thousand square feet) (3/4” basis)

 

219

 

230

 

243

 

 

 

 

 

Lumber (thousand board feet)

 

412

 

400

 

446

 

 

 

 

 

LVL (hundred cubic feet)

 

1,453

 

1,447

 

1,440

 

 

 

 

 

I-joists (thousand equivalent lineal feet)

 

867

 

861

 

865

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Boise Paper Solutions

 

 

 

 

 

 

 

 

 

 

 

Sales Volumes (thousands of short tons)

 

 

 

 

 

 

 

 

 

 

 

Uncoated free sheet

 

353

 

351

 

353

 

 

 

 

 

Containerboard

 

158

 

154

 

170

 

 

 

 

 

Newsprint

 

106

 

89

 

101

 

 

 

 

 

Other

 

33

 

31

 

47

 

 

 

 

 

 

 

650

 

625

 

671

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corrugated containers (millions of square feet)

 

1,122

 

1,151

 

1,204

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selected Prices (average net selling prices per short ton)

 

 

 

 

 

 

 

 

 

 

 

Uncoated free sheet

 

$

747

 

$

734

 

$

713

 

 

 

 

 

Containerboard

 

341

 

347

 

342

 

 

 

 

 

Newsprint

 

374

 

399

 

412

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)  Represents 100% of the sales volume of Voyageur Panel, of which we own 47%.

 

4