8-K

                      SECURITIES AND EXCHANGE COMMISSION

                            WASHINGTON, D.C. 20549

                                   FORM 8-K

                                CURRENT REPORT

                    Pursuant to Section 13 or 15 (d) of the
                        Securities Exchange Act of 1934

                               December 6, 1994
               Date of Report (Date of Earliest Event Reported)

                          INTERNATIONAL PAPER COMPANY
            (Exact name of Registrant as specified in its charter)

New York                          1-3157                         13-0872805
(State of                         (Commission                    (IRS Employer
Incorporation)                    File)                          Identification
                                                                 Number)
                 Two Manhattanville Road, Purchase, NY  10577
                   (Address of Principal executive offices)

                                 914-397-1500
                                (Telephone No.)


                      SECURITIES AND EXCHANGE COMMISSION

                            WASHINGTON, D.C.  20549

ITEM 1.   CHANGES IN CONTROL OF REGISTRANT

          N/A

ITEM 2.   ACQUISITION OR DISPOSITION OF ASSETS

          N/A

ITEM 3.   BANKRUPTCY OR RECEIVERSHIP

          N/A

ITEM 4.   CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT

          N/A

ITEM 5.   OTHER EVENTS

          Speech by Mr. John A. Georges, Chairman and CEO of International
          Paper Company, delivered to a Financial Analysts meeting held on
          October 18, 1994 in New York, New York.

ITEM 6.   RESIGNATIONS OF REGISTRANT'S DIRECTORS

          N/A

ITEM 7.   FINANCIAL STATEMENTS AND EXHIBITS

          (a) Financial Statements:

          N/A

          (b) Pro Forma Financial Information:

          N/A

                                       2

          (c) Exhibits:

               (99) Speech by Mr. John A. Georges, Chairman and CEO of
                    International Paper Company, delivered to a Financial
                    Analysts meeting held on October 18, 1994.

     ITEM 8.   CHANGES IN FISCAL YEAR

               N/A

                                       3


                                  Signatures

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                             INTERNATIONAL PAPER COMPANY
                                             (Registrant)

Date: December 6, 1994                       /s/ SYVERT E. NERHEIM
      Purchase, NY                           Syvert E. Nerheim
                                             Assistant Secretary

                                       4

                                 EXHIBIT INDEX

        (99) Speech by Mr. John A. Georges, Chairman and CEO of International
             Paper Company, delivered to a Financial Analysts meeting held on
             October 18, 1994.

EX-99

JOHN A. GEORGES
CHAIRMAN AND CHIEF EXECUTIVE OFFICER

Good afternoon. Now that you have had a chance to absorb the information from 
this morning, I'd like to share with you my thoughts about International 
Paper's plans and prospects for the future. As you know, I became chief 
executive officer of International Paper 10 years ago. When I did, I made a 
commitment to you. Those of you who were here at that time may remember that 
I said I would never overpromise and that I would deliver on what I said. And 
I believe that we as an organization have lived up to that commitment. When I 
say to you today that I'm excited about the prospects for our company over 
the next several years, I don't use those words lightly. 

You know that we've maintained a respectable level of profitability even 
through the down cycle and that we are today in a very strong financial 
position. That distinguishes us from a number of our competitors. 

Another factor is that - and I realize I'm somewhat biased when I make the 
comment - I have the strongest management team in the industry: not just the 
people you heard from this morning, who in my mind are very impressive, but 
the others in this room with whom you are having lunch. They are as dedicated 
as I am to making a step change in the profitability of our company over the 
next several years. And I'll tell you in a few minutes how we're going to do 
that. I'm going to take the information given to you by Bob, Wes, John and 
Mark, and put much of that same information in a different context, a context 
that will help you understand what we're about.

STRATEGIES

  Value-Added Products

  Cost Reduction

  Growth

    o Core Paper, Packaging and Wood Businesses
    o Distribution and Specialty Products Businesses
    o Geographic Coverage

  GOAL: 15 PERCENT ROE OVER A FULL CYCLE

Over the past years, we have described our strategies as constituting the 
following: (1) We said we wanted to increase the quantity of value-added 
products in our core products and to expand into related specialty 
businesses. (2) We wanted to be a low-cost producer in our major product 
areas, through aggressive cost reduction. (3) We wanted to grow our revenues 
by selectively expanding in our core paper, packaging and wood businesses, in 
distribution and specialty products businesses, and in geographic coverage.

There were obvious underlying reasons for these strategies. Back in the 
middle 1980s, our mix in most of our businesses consisted almost entirely of 
basic commodity grades. We were not a value-added company. Also, while we had 
moved from being a company of old, higher cost mills through an aggressive 

modernization program in the early 1980s and had made substantial progress, 
we still had more to do. We needed to bring new vitality to the company to 
help it grow. (We had flat revenues for quite a number of years as we went 
through our restructuring.) We were interested in expanding our product line 
to include products that were related to our core competencies, that would 
give us greater growth and profitability and less cyclicality. This is what 
we promised you some years ago.

                                      1

We also said we would pursue opportunities globally, seeking the best return 
for our shareholders. And, finally, we set a goal to achieve a 15 percent 
return on equity on average over a full business cycle. When I first stated 
that goal, our ROE was 2 to 3 percent.

Today, I'd like to update you on our strategies in view of the progress we 
have made. So let me take some of the same information given to you by the 
previous speakers and restate it in the context of these strategies. 

VALUE-ADDED PRODUCTS

Let's first review the pursuit of enriching our product mix with value-added 
products. 

In containerboard, in the trough of the last cycle, only 5 to 10 percent of 
our products were what I would call value-added. By value-added I mean 
products for which we received a higher price in the marketplace than the 
basic product. I'm not talking about either recycled or lightweight products, 
but some of the other specialty products. As John said, today about 30 
percent of our product line commands a higher price. The Mansfield mill 
coming on stream in 1996 will add to that capability. 

INDUSTRIAL PACKAGING

  High Strength, High Smoothness
  Lightweight, Moisture Resistant
  Recycled
  Mottled White, White-Top
  Triton System

Let's now turn to consumer packaging. In bleached board, the change is even 
more dramatic, given the recent modernization of our Texarkana, Texas, Pine 
Bluff, Ark., and Moss Point, Miss., mills. Before that modernization, I'd say 
we were primarily in the commodity end of the folding carton business, and we 
also made carton board for liquid packaging. Currently, we sell very little 
in the commodity end of the business. Today, John Dillon covered the progress 
we've made.

Now some of our progress has been tedious: for example, our aseptic packaging 
program has been going on for almost 10 years. But we have persevered. Today, 
we're proud of our product line. It's as good as any in the business, and we 
are the clear leaders in some areas.

CONSUMER PACKAGING


  Aseptic Systems
  Liquid Packaging
    o Juice Cartons
    o Spout Pak
  High-End Graphics
  Coatings

In printing papers, our Hammermill and Springhill brands are respected as the 
premier lines in the uncoated white papers business. Recently, we've added 
100 percent recycled products and we've done a tremendous amount of work to 
develop new specialty products for today's office equipment.

PRINTING PAPERS

  100% Recycled Products
  Specialty Papers for New Equipment
    o Ink-Jet Printers
    o Laser Printers
    o Color Graphics

In the specialty products businesses, Mark Suwyn described a broad array of 
new products, the life blood of these businesses. 

                                      2

SPECIALTY PRODUCTS

  Masonite
    o New Door Facing Products - CraftMaster
    o New Wood Siding - OmniWood

  Decorative Products
    o Acquired Fome-Cor

  Nonwovens
    o New Polypropylene Spunbond Lines
    o Hydroentanglement - Project Coral

  Specialty Industrial Papers

  Specialty Chemicals

  Imaging

    o Direct Computer-to-Plate Products
    o Imagesetting Films
    o Multi IV Photographic Paper

The idea I want to convey to you is that we have made very substantial 
progress in our strategy to expand our offering of value-added products. 

At a recent management meeting, we reviewed our organization, our process and 
our progress and we concluded that it was time to step up our efforts in 

product development. In the last few years, we have reduced by half the time 
needed to take a new grade or product from conception to commercial 
production. In short, we have drastically improved our productivity. We've 
hired a competent group of young, skilled people, and we intend to expand our 
product development efforts in the coming years.

You have perhaps read recently that we are consolidating all of our packaging 
development efforts in a new facility in Cincinnati, Ohio, from nine locations
around the country. Development of paper products will be at Erie, Pa., and
McKinney, Texas. Just a year ago, we purchased a coating facility in McKinney
for the production of low-volume grades of specialty paper products. The
facility is profitable, but more importantly, it's a development facility. In
our first year, we commercialized 13 new grades through McKinney. Today, we
have 15 development projects being processed there. We've come a long way, and 
product development remains a very high and important strategy in the coming 
years. 

COST REDUCTION

Let me move to our second key strategy, cost reduction. I'm not talking about 
the ongoing cost reduction that companies do all the time. On that, we keep 
score. It runs about $100 million to $200 million a year on things that we do 
to provide incremental change in the organization. We do that to be 
competitive, and usually our customer winds up getting the cost savings. 
Seldom do we improve our profitability a lot through ongoing cost reduction, 
but heaven help you if you don't. The idea is to do it as well as, if not 
better than, the competition.

As we went through the last cycle, we took a very hard look at ourselves. We 
knew that we couldn't wait for good times to return, that we had to make step 
changes in our organization. Now for the next five minutes, I'm going to talk 
about manufacturing. It is an important part of our business, and we are 
spending a great deal of time focusing on the manufacturing aspects of our 
organization.

One way of getting cost reduction is through capital expenditures, what I 
call a capital-intensive process. We're very good at that, and we have done a 
lot of it in the past. What I'm going to describe to you now is quite 
different and is not capital-intensive at all. It deals in a very significant 
way with how you manage people 

                                      3

and how you run the organization. But let me take you a step at a time 
through our cost reduction process.

COST REDUCTION

  Reduce Management Layers

  High-Performance Work Systems

  Organization Redesign


  Productivity Improvements
    o Precision in Manufacturing
    o Mill Uptime and Improved Manufacturing Systems
    o Cost of Quality

  Leverage Purchasing Power

REDUCE MANAGEMENT LAYERS

The first thing that we did was to benchmark ourselves with companies both 
inside and outside our industry. As we did, we realized that we had work to 
do in terms of reducing management layers. It sounds simple, but it's a 
little harder to put into practice. After much study, we concluded that we 
must reduce the number of layers in our organization by an average of about 
one and a half over the next 15 months. The actual reduction will be 
somewhere between one and two layers, depending on the part of the 
organization.

A lot of good things happen if you handle this reduction right. It is not 
just a question of reducing people, although that is an important part of it. 
More importantly, in reducing layers you end up with a more efficient 
organization. Layers in an organization are like glue. By this I mean that 
things take longer to get through it. The fewer people from whom you need to 
get approvals and the more you empower people to make decisions, the faster
things go. But suffice it to say that we are  committed to reducing the layers
in our organization. We thought we had a  lean organization, but now we're
committed to getting even leaner. 

HIGH-PERFORMANCE WORK SYSTEMS

The second part of our cost reduction effort has to do with high-performance 
work systems. Different people call this concept by different names, but 
basically it deals with how you get your work force to do what they are fully 
capable of doing on their own. Company after company has found that one of 
the biggest problems lies in having supervisors tell workers what to do and 
how to do it when, in fact, the workers are quite capable of making these 
decisions themselves.

At International Paper, we've had some good success with high-performance 
work systems. Several of our mills and plants are far along in using the 
concept as a way of energizing and involving the work force. In every case, 
the results are phenomenal in terms of output, quality and yields - 
everything that matters in a manufacturing organization.

So here is our job: How do we take something that is well known and apply it 
in several hundred installations in this company, and in a finite time frame? 
I'm not talking about 10 years or even five years in the future. The job for 
us is to do it so that we start to get a payoff immediately, recognizing that 
to capture the essence of what people call high-performance work systems will 
take a little longer. We're into this and we're convinced that it will make a 
big difference in the way we manage the Company. In 

                                      4


fact, it makes the reduction of layers possible. These efforts are additive 
and reinforcing. You can't do one without doing the other.

ORGANIZATION REDESIGN

Our cost reduction programs are not limited to our plants and mills. As part 
of our organization redesign, we've taken a closer look at our finance and 
human resource organizations. We found that each of the acquisitions we made 
over the past several years came with its own financial system. Although we 
have worked hard to consolidate these systems, we discovered further 
opportunities to reduce costs. 

Our analysis showed that our finance-related costs were about 1.5 percent of 
our revenues, which is below average for a large U.S. industrial company. We 
found that a typical company was at 1.8 percent and that 1.5 percent was 
excellent. However, the really outstanding companies were at the 1.1 percent 
level, and our program is aimed to get us there. About 18 months ago, our 
finance organization went to work on this organization redesign. They're well 
into it and we're going to begin seeing a payoff on it next year. It will 
take another couple of years to complete.

The same thing can be said about the human resource organization redesign.

PRODUCTIVITY IMPROVEMENTS

As we move on in the manufacturing organization, our initiatives take a back 
to basics, blocking and tackling approach. "Precision in manufacturing" 
requires everyone in the plant or mill to continually assess and improve 
operating procedures and to make sure that all machine components are 
maintained properly and that operators know how to do their jobs in the safest,
most efficient and most quality-conscious way. It is a systematic approach to
training and to quality management.

Now if you have one mill, you can argue that you have to learn it all 
yourself. But when you have as many mills and plants as we do, you can 
leverage that into a competitive advantage because what you learn at one 
place can be applied someplace else. 

We've been doing this now for about a year in our printing papers 
organization. Effectiveness - by this I mean product output - has gone up 5 
percent. But there's more to be gained. We are applying what we've learned to 
our several hundred installations around the country. All the principles are 
the same.

"Mill uptime and improved manufacturing and maintenance systems" is designed 
to improve the reliability and availability of our plant and machinery. It 
involves getting people to solve problems to keep costs down. This need not 
be done at the supervisor's level, but rather at the maintenance and operator 
level where problems first occur. 

We've had four mills on a special program for the past year. On average they 
are getting $6 million to $10 million a year savings in mill uptime and 
in improved manufacturing and maintenance from their efforts. We've 
demonstrated it can be done. Now we intend to do it in every location of this 

company.

Another cost reduction initiative currently under way is an effort to reduce 
the "cost of quality" throughout the system. This program is based on the 
idea that we can measure and control the amount of money spent on preventing, 
evaluating, correcting and recovering from products 

                                      5

that don't meet our customers' specifications. In our businesses, the cost of
quality can range from 4 percent to more than 30 percent, depending on the
complexity of the operation. Obviously, you can't eliminate all such costs.
There are reasons why some of this cost exists. For example, the trim of the
machine just isn't perfect. But we also know that when a mill attacks cost of
quality in a disciplined way, it can get the numbers down significantly. We
have mills that have taken cost of quality from 25 percent down to 20 percent.
Now when you start multiplying such reductions across a company our size, the
dollars are profound. And again, we've been working on quality for a long time.
We've seen where our star plants have succeeded in reducing the cost of
quality. The question now is, how do we get 200 installations to do it all the
time? We think we know how to do it; it's now a question of being sure that we 
challenge the entire organization to do it and, again, to do it over a finite 
period of time.

LEVERAGE PURCHASING POWER

As our final step in cost reduction, we have learned that as we've gotten 
bigger, we can leverage our ability to buy. For example, we've got some 60 
plants that buy inks. All of them used to buy it by themselves; they 
specified their own and bought it. Now we have them all buy it together for a 
savings of 20 percent on ink cost - big dollars for a company our size. 

We have centralized our purchasing for major items but have not done it for 
our specialty or international businesses. Now, though, we're going to do it 
across our whole system, down to many much smaller items, and I believe this 
will contribute a fair amount to savings.



EARNINGS IMPACT

IMPACT OF COST REDUCTION INITIATIVES

  o Cost Savings of Several Hundred Million Dollars    
    Annually

What am I looking for? Out of all this, I'm saying that we're going to 
capture several hundred million dollars a year. I'm confident of it, and I'm 
being conservative in saying it. These steps are different from the cost 
reduction we've done up to now in the sense that we're not going to pass it 
on. I think we're going to be able to keep most of it because it results from 
a step change, and I don't think our competitors are going to catch up to us 
on this one. And so on this one I've got to be braver and say, normal cost 
reduction savings will get passed on, but a large part of these reductions 

I'm going to capture for International Paper's shareholders

INTERNATIONAL PAPER

Earnings at Bottom of Economic Cycles

  Early to Mid-1980s                  $0 Per Share

  Low of Last Cycle                   $2 to $3 Per Share

  Expected Low of Next Cycle          $4 to $5 Per Share

What might all of this mean? If you look back to the mid-1980s when times 
were rough for International Paper, we were one of the poorer performing 
companies in the industry. We were just about at break-even. Through the 
work that we did beginning at that time through the last cycle, our earnings 
bottomed at $2 to $3 per share. I don't think many paper companies can say 
that at the bottom they did better in this cycle than the previous cycle. But 
we think we made a step improvement in our relative position in the industry.

                                      6

As a result of the activities I've just discussed, when the next cycle comes, 
and it will come, our objective is to earn $4 to $5 a share at the bottom. 
And I'm pretty bullish that we're going to make that happen. Cost reduction 
will continue, except that we are making step changes in how we do things, 
instead of only the incremental changes that we were making in the past.

GROWTH

GROWTH: CORE PAPER & PACKAGING BUSINESSES

  Mansfield    Lightweight Containerboard - Recycled
  Riverdale    Uncoated Freesheet - Recycled
  Kwidzyn      Uncoated Freesheet, Coated Board
  Nicolet      Specialty Industrial Papers
  Oswego       Lightweight Containerboard - Recycled

        ONE MILLION TONS OF ADDITIONAL
          PRODUCT IN A RISING MARKET

Let me move on to the next item that we talked about, growth. Today, you've 
heard that we're going to bring on about a million tons of additional product 
in the next 18 to 24 months through projects that are well under way. This 
will add substantially to International Paper's earnings in the rising 
market. As it comes on line over the next two years, it represents only 
minimal industry expansion across a wide variety of products and markets. 

Nevertheless, it's coming on stream in the right businesses at the right time 
in the cycle. It is also the most ambitious program in the Company's history. 
We have never had this kind of growth program in our core paper and packaging 
businesses. Importantly, it's not the only growth that's going on. You heard 
about most of the other growth areas earlier today, but there are some you 
didn't hear about. For example, there is rapid growth in a whole variety of 

our specialty businesses. The interesting point here is that, in almost every 
instance, the products we're adding qualify as being close to proprietary, if 
not specialty, products. And these are businesses that are growing worldwide.

GROWTH: SPECIALTY BUSINESSES

OSB Plant - Texas
CraftMaster Door Facing Line - Laurel, Miss., and Europe
Polypropylene Spunbond - Toronto, Canada, and Mexico
Project Coral - Commercial Development Unit
Liquid Packaging - China and France
Nevamar Expansion
Expanded Chemicals - Panama City, Fla., and Europe

          LARGELY PROPRIETARY PRODUCTS
             IN SPECIALIZED MARKETS

We will also continue to look for acquisitions that will add strength to 
these businesses. You've seen us acquire distribution companies and other 
small operations that fit well with these businesses, and I would expect that 
to continue.

The international market is yet another area for growth. In the past couple 
of years, we've made a number of investments in overseas markets. Kwidzyn, 
our mill in Poland, will cost us a total of $300 million when we're finished 
with the modernization program next year. To date, the Kwidzyn investment is 
performing beyond our expectations. 

Scitex is an equity investment we made in the last couple of years. It has 
been a disappointment in the sense that the price of the stock has declined, 
partly because of an earnings decline and partly because the Israeli market 
collapsed. But it has stabilized and it's swinging up. Over the long term, 
the Scitex investment will still serve the purpose for which it was intended. 

                                      7

Carter Holt Harvey, where we have a 24 percent interest in a major 
corporation in New Zealand, has been an excellent investment. The business 
has done well, as has the price of the stock. It has also given us a window 
in two important parts of the world - the Pacific Rim and South America. We 
hope to find a way to participate in these markets to a greater extent than 
we do now.
 
Our strategy continues to include interest in global markets and we have made 
some recent organization changes to further this interest. These changes follow
the pattern set in Europe. After we established a sizable base there, Wes Smith
went over as president of International Paper - Europe. He spent three years
there; now Mike Amick is in that position. The European operation has expanded
and is much improved over time.

Just recently we've assigned Jerry Marterer, who managed our specialty 
industrial papers business and our quality program, to be president of 
International Paper - Asia. He's going to be based in Hong Kong; in fact, 
he's there now. Although we've had a presence in the Far East, our knowledge 

of it has been limited and our efforts there fragmented. Jerry is there to 
give us a high-level corporate development presence and to help us look at 
opportunities in that part of the world. He will get to understand the 
markets, the businesses, the people. 

Similarly, we have named Harry Lambroussis, formerly vice president of our 
imaging business, to be president of International Paper - Latin/South 
America. Like Jerry Marterer, he will have operational responsibility but, 
more importantly, he will have corporate development responsibility for the 
Southern Hemisphere. (You've already heard from a number of people today 
about our plans to build a plant in Mexico and to expand in South America.) 
There are many opportunities in Latin America - we just have to be astute 
enough to figure out how to take full advantage of them. 

Before I leave you today, I want to point out that these remarks are my way 
of saying that the strategies we described to you over the last seven or 
eight years remain the fundamental strategies that are in place today. We're 
going to continue to emphasize value-added products and we're going to expand 
that effort. We have a monumental cost reduction effort under way in this 
company. And we continue to look at - and probably have - the most expansive 
growth plan for the next couple of years that we've ever had.

In conclusion, this is for us a very unusual time. We think we've done many 
good things over the past few years that have positioned us well in terms of 
products, costs and markets. And, frankly, we've come to a point now where we 
think we've got the wind behind us. We think we're going to enjoy two or 
three spectacular years.

The thing I want to convey to you, however, is that a part of the activity in 
the organization is aimed at taking full advantage of the economic upswing 
and strong demand we're seeing now. That's going to happen, and that is the 
easy part of managing a business. The difficult part is how we position 
ourselves far beyond that. And that's the reason we're talking about the 
continued emphasis on product development and on step changes to achieve cost 
reduction. We're pretty excited about what's happening. I would like to close 
by saying, "We're Ready."

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