First Quarter

2010 Review

April 29, 2010

First Quarter

2010 Review

April 29, 2010

John V. Faraci

Chairman &

Chief Executive Officer

Tim S. Nicholls

Senior Vice President &

Chief Financial Officer

Exhibit 99.2

2

Forward-Looking Statements

Forward-Looking Statements

These

slides

and

statements

made

during

this

presentation

contain

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;

(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

our

products;

(iii)

global

economic

conditions

and

political

changes,

including

but

not

limited

to

the

impairment

of

financial

institutions,

changes

in

currency

exchange

rates,

credit

ratings

issued

by

recognized

credit

rating

organizations,

the

amount

of

our

future

pension

funding

obligation

and

changes

in

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.

3

Statements Relating to Non-GAAP

Financial Measures

Statements Relating to Non-GAAP

Financial Measures

During the course of this presentation, certain

non-U.S. GAAP financial information will be

presented.

A reconciliation of those numbers to U.S.

GAAP financial measures is available on the

company’s website at internationalpaper.com

under Investors.

4

First Quarter 2010

In Line with Expectations

First Quarter 2010

In Line with Expectations

Cyclical trough earnings quarter

Significant N.A. fiber cost inflation

& heavy maintenance outages

Price only modest benefit

Strong results in European Paper &

Packaging

Reduced operating costs

Demand improving at quarter’s end

Substantial price improvement

occurring at end of 1Q

2Q significantly better than 1Q

Earnings from continuing operations before

special items

5

1Q10 Financial Snapshot

1Q10 Financial Snapshot

1Q09

4Q09

1Q10

Sales ($B)

$5.7

$6.0

$5.8

EBITDA

($MM)

$604

$669

$560

Free

Cash

Flow

($MM)

$521

$530

$39

Debt ($B)

$11.5

$9.0

$9.0

Cash Balance ($B)

$1.0

$1.9

$1.7

1

Earnings from continuing operations before special items

2

Cash provided by continuing operations less capital expenditures, excluding cash received from alternative fuel credits of

$0.1 B in 1Q09 and $0.4 B in 4Q09

2

1

6

Earnings before special items

1Q10 vs. 4Q09 EPS

Higher Input Costs, Reduced Operating Costs

1Q10 vs. 4Q09 EPS

Higher Input Costs, Reduced Operating Costs

7

Global Input Costs

$100 MM North American Fiber Cost Spike

Global Input Costs

$100 MM North American Fiber Cost Spike

By Business

By Input Type

8

Business Highlights

1Q10

Business Highlights

1Q10

Solid Earnings

Europe & Russia (All Segments)

xpedx

Sun JV

Reduced Fixed Costs

Inverurie (UFS)

Etienne (Liner)

Albany & Pineville (Containerboard)

Franklin (Coated Paperboard)

xpedx

9

Industrial Packaging Earnings

1Q10 vs. 4Q09

Industrial Packaging Earnings

1Q10 vs. 4Q09

Earnings before special items

50% of Annual

Maintenance

Outages in 1Q10

10

N.A. Industrial Packaging Relative EBITDA Margins

N.A. Industrial Packaging Relative EBITDA Margins

IP EBITDA margins based on North American Industrial Packaging operating profit before special items

Competitor EBITDA margin estimates obtained from public filings and IP analysis

IP 1Q10 margin

reflects 148,000 tons or

5.9% downtime

Competitor A 1Q10 margin

reflects 35,000 tons or

5.7% downtime

Competitor B 1Q10 margin

reflects 36,000 tons or

3.5% downtime

11

Printing Papers Earnings

1Q10 vs. 4Q09

Printing Papers Earnings

1Q10 vs. 4Q09

Earnings before special items

12

Consumer Packaging Earnings

1Q10 vs. 4Q09

Consumer Packaging Earnings

1Q10 vs. 4Q09

Earnings before special items

13

$ Million

1Q09

4Q09

1Q10

Sales

$1,590

$1,675

$1,580

Earnings

($7)

$31

$21

xpedx

xpedx

Seasonal volume decrease

Strong year-over-year earnings improvement

driven by reduced operating costs

Also, strong quarter-over-quarter improvement

after 4Q inventory accounting adjustment

9% year-over-year headcount reduction

4Q09 earnings include a $17 MM favorable LIFO inventory valuation adjustment

14

$ Million

1Q09

4Q09

1Q10

Sales (100%)

$395

$350

$395

Earnings (IP Share)

($26)

$6

($3)

Ilim’s results are reported on a one-quarter lag

IP’s shares of Ilim’s 1Q09, 4Q09 & 1Q10 earnings includes an after-tax foreign exchange loss of $15 MM, an after-tax foreign

exchange gain of $2 MM and an after-tax foreign exchange loss of $2 MM, respectively

Ilim Joint Venture

Ilim Joint Venture

1Q10 vs. 4Q09

1Q10 vs. 1Q09

Business

Volume

Price /

Ton

Volume

Price /

Ton

Pulp

5%

$76

8%

$1

Containerboard

(3%)

$40

9%

($91)

15

First Quarter Summary

Cyclical Trough –

Worst is Behind Us

First Quarter Summary

Cyclical Trough –

Worst is Behind Us

1Q10 Summary

N.A. Fiber Cost Spike

High Maintenance     

Outages

Reduced Operational  Costs

Price Improvement at

Quarter-End

2Q10 Outlook

Realization of Announced

Price Increases

Improving Demand

Declining Input Costs

Higher Outages Costs

Reduced Fixed Costs

16

Earnings Runway

Potential Impact of Price Increase Realization

Earnings Runway

Potential Impact of Price Increase Realization

17

Balanced Capital Allocation

to Increase Shareowner Value

Balanced Capital Allocation

to Increase Shareowner Value

18

Dividend Increase

Returning Cash to Shareowners

Dividend Increase

Returning Cash to Shareowners

Improving Global Economy

Normal Credit Markets

$3.7

B Debt Reduction

Annual Dividend: $0.10 to $0.50

19

China

Thailand

Malaysia

India

Singapore

Agreed to purchase SCA’s Asian

packaging business for $200 MM

less post-closing adjustments

SCA system includes 13 corrugated

box plants and two specialty packaging

facilities

$340 MM Combined 2009 Revenue

Strengthening IP Asia

Acquiring SCA’s Asian Packaging Business

Strengthening IP Asia

Acquiring SCA’s Asian Packaging Business

Expect to complete the

purchase in 2Q10

SCA facilities complement

IP’s existing corrugated

packaging system

SCA Plants

IP Plants

Indonesia

20

Second Quarter Outlook

Changes from 1Q10

Second Quarter Outlook

Changes from 1Q10

North

America

Europe

Brazil

Asia

Volume

Paper

Stable

Stable

Increasing

Increasing

Packaging

Increasing

Stable

Pricing

Paper

Increasing

Increasing

Increasing

Increasing

Packaging

Significant

Increase

Stable

Maintenance Outages

~$8 MM

Increase

~$11 MM

Increase

~$5 MM

Increase

Input & Freight Costs

Decreasing

Linerboard

Increasing

Stable

Pulp

Increasing

xpedx

Modest

Improvement

Ilim

Increase

Corporate

Expense

Stable

21

Appendix

Investor Relations Contacts

Thomas A. Cleves

901-419-7566

Emily Nix

901-419-4987

Media Contact

Patty Neuhoff

901-419-4052

22

$ Million

2008

2009

2010

Estimate

Capital Spending

$1,002

$534

$800

Depreciation &

Amortization

$1,347

$1,472

$1,450

Net Interest Expense

$492

$669

$600 -

$625

Corporate Items

$103

$181

$200 -

$225

Effective Tax Rate

31.5%

30%

30-32%

1

Before special items and excluding Ilim

Key Financial Statistics

Key Financial Statistics

1

1

1

23

Free Cash Flow

Free Cash Flow

$ Million

1Q09

4Q09

1Q10

Cash from Operations

$649

$697

$159

Cash Received from Alternative Fuel

Mixture Tax Credits (AFMTC)

$145

$388

$0

Cash Provided by Continuing

Operations

$794

$1,085

$159

Less Capital Investment

($128)

($167)

($120)

Free Cash Flow

$666

$918

$39

Free Cash Flow Excluding AFMTC

$521

$530

$39

24

Monetization & Other: Intend to rollover or refinance timber monetization debt, Sun JV debt and other foreign subsidiary debt

Debt Maturity Profile

Maturities as of Quarter-End

Debt Maturity Profile

Maturities as of Quarter-End

25

North American Downtime

6% of Capacity in 1Q

North American Downtime

6% of Capacity in 1Q

•

Lack-of-order & maintenance downtime for North American Containerboard, Uncoated Papers, Market Pulp, & Coated    

Paperboard.  See the following slide for detail by business.

Lack of order downtime excludes capacity from mills or machines that have been permanently shutdown

1,253

965

653

617

220

Primarily due to

wood shortages

26

North American Downtime

North American Downtime

•

Lack of order downtime excludes capacity from mills or machines that have been permanently shutdown

Containerboard

Uncoated Papers

Market Pulp

Coated

Paperboard

456

33

91

54

18

21

148

27

$ Million

1Q10

2Q10E

3Q10E

4Q10E

Industrial Packaging

$70

$45

$6

$25

North America

$27

$48

$18

$37

Europe

0

11

15

15

Brazil

0

5

0

0

Printing Papers Total

$27

$64

$33

$52

Consumer Packaging

$6

$19

$0

$16

Total Impact

$103

$128

$39

$93

Dollar impact of planned maintenance outages are estimates and subject to change

Maintenance Outages Expenses

Maintenance Outages Expenses

28

Forest Products

Forest Products

1Q09

4Q09

1Q10

Sales ($ MM)

$5

$25

$10

Earnings ($ MM)

$2

$18

$8

Acres Sold

2,000

7,700

3,300

Price / Acre

$2,108

$2,655

$2,418

1

4Q09 figures exclude a 17,000-acre sale of a partnership interest at $369 per acre.

At

the

end

of

1Q10,

our

land

portfolio

has

~200,000

acres

with

an

estimated

value

of

$225

-

$250

million

1

1

29

1Q10 vs. 4Q09

1Q10 vs. 1Q09

Business

Volume

Price /

Ton

Volume

Price /

Ton

N.A. Container

2%

$1

2%

($74)

European Container

1%

€7

(4%)

(€53)

Industrial Packaging

Industrial Packaging

N.A. Price Improvement

per Ton vs. 12/31/09

1Q10 Exit

Price 

4/28/10

Price

Domestic Containerboard

$27

$49

Boxes

$27

$39

30

Average

IP

price

realization

(includes

the

impact

of

mix

across

all

grades)

1Q10 vs. 4Q09

1Q10 vs. 1Q09

Business

Volume

Price / Ton

Volume

Price / Ton

N.A. Paper

(4%)

$23

2%

($49)

N.A. Pulp

(15%)

$83

7%

$94

European Paper

(7%)

€5

(17%)

(€44)

Printing Papers

Printing Papers

31

Average IP price realization (includes the impact of mix across all grades)

1Q10 vs. 4Q09

1Q10 vs. 1Q09

Volume

Price/Ton

Volume

Price/Ton

U.S. Coated Paperboard

10%

($3)

19%

($44)

Revenue

Price

Revenue

Price

Converting Businesses

(6%)

NA

(5%)

NA

Consumer Packaging

Consumer Packaging

32

Special Items Pre-Tax

from Continuing Operations

Special Items Pre-Tax

from Continuing Operations

Special Items Pre-Tax ($Million)

1Q09

4Q09

1Q10

Industrial

Packaging

Alternative Fuel Mixture Credits

$208

$212

Facility & Machine Closure Costs

($670)

($5)

Integration Costs

($36)

($15)

Other

($2)

Printing

Papers

Alternative Fuel Mixture Credits

$240

$221

Facility Closure Costs

($29)

($223)

($204)

Consumer

Packaging

Alternative Fuel Mixture Credits

$92

$83

Facility Closure Costs

($67)

Reorganization

($2)

($2)

($3)

xpedx

Reorganization

($5)

Corporate

Restructuring & Other Charges

($52)

($82)

($3)

Total Special Items Pre-Tax

$421

$356

($215)

33

Special Items Net of Taxes

from Continuing Operations

Special Items Net of Taxes

from Continuing Operations

1Q10

$ Million

EPS

Earnings Before Special Items

$16

$0.04

Special Items Net of Taxes:

Franklin Mill Shutdown

($124)

Tax Adjustments

($46)*

Other Facility Closures

($6)

Other Corporate

($2)

Total Special Items Net of Taxes

($178)

($0.42)

Net Earnings

($162)

($0.38)

*

Tax

adjustments

include

a

non-cash

charge

of

$32

million

to

reduce

deferred

tax

assets

related

to

post-retirement

prescription

drug

coverage

(Medicare

Part

D

reimbursements)

34

1Q10 EBITDA

before Special Items

1Q10 EBITDA

before Special Items

Operating

Profit

$ Million

D & A

$ Million

Tons

Thousand

EBITDA

per Ton

EBITDA

Margin

Industrial Packaging

North America

$18

$143

2,481

$65

9.1%

Europe

$24

$7

258

$120

12.6%

Printing Papers

North America

$70

$58

722

$177

18.7%

Western

Europe

$5

$5

68

$147

13.7%

Eastern Europe & Russia

$42

$14

241

$232

26.9%

Brazil

$11

$34

248

$181

19.8%

U.S. Market Pulp

($3)

$15

248

$48

7.6%

Consumer Packaging

U.S. Coated Paperboard

$3

$33

339

$106

9.8%

1

Excludes Recycling & Bag businesses; includes Saturating Kraft business

2

Includes Bleached Kraft business

3

Excludes Market Pulp

1

2

3

3

35

Operating Profits by Industry Segment

from Continuing Operations

Operating Profits by Industry Segment

from Continuing Operations

$ Million

1Q09

4Q09

1Q10

Industrial Packaging

$188

$84

$46

Printing Papers

$101

$139

$126

Consumer Packaging

$22

$49

$31

Distribution

($7)

$31

$21

Forest Products

$2

$18

$8

Operating Profit

$306

$321

$232

Net Interest Expense

($164)

($163)

($149)

Noncontrolling Interest / Equity Earnings Adjustment

$6

$4

$8

Corporate Items

($51)

($40)

($51)

Special Items

$421

($550)

($215)

Earnings (Loss) from continuing operations before

income taxes, equity earnings & noncontrolling interest

$518

($428)

($175)

Equity Earnings (Loss), net of taxes -

Ilim

($26)

$6

($3)

36

Geographic Business Segment Operating Results

from Continuing Operations before Special Items

Geographic Business Segment Operating Results

from Continuing Operations before Special Items

$ Million

Sales

Operating Profit

1Q09

4Q09

1Q10

1Q09

4Q09

1Q10

Industrial Packaging

North American

$1,885

$1,855

$1,890

$175

$68

$23

European

$240

$260

$245

$13

$17

$24

Asian

$55

$95

$85

$0

($1)

($1)

Printing Papers

North American

$705

$700

$685

$84

$70

$70

European

$325

$340

$315

$25

$46

$48

Brazilian

$170

$300

$225

$20

$33

$11

U.S. Market Pulp

$125

$160

$155

($28)

($11)

($3)

Asian

$0

$25

$25

$0

$1

$0

Consumer Packaging

North American

$530

$540

$550

$4

$22

($1)

European

$70

$85

$85

$14

$21

$20

Asian

$115

$160

$170

$4

$6

$12

Distribution

$1,590

$1,675

$1,580

($7)

$31

$21

Excludes Forest Products

37

Pre-Tax

$MM

Tax

$MM

Non-

controlling

Interest

$MM

Equity

Earnings

Net

Income

$MM

Estimated

Tax Rate

Average

Shares1

MM

Diluted

EPS²

Before Special Items

1Q10

$40

($13)

($9)

($2)

$16

32%

429

$0.04

Special Items

1Q10

($215)

$37

$0

$0

($178)

17%

429

($0.42)

Earnings

1Q10

($175)

$24

($9)

($2)

($162)

14%

429

($0.38)

2010 Earnings from Continuing Operations

2010 Earnings from Continuing Operations

1

Assuming dilution 

2

A reconciliation to GAAP EPS is available at www.internationalpaper.com under the Investors tab at Webcasts and Presentations

38

Earnings from continuing operations before special items

1Q10 vs. 1Q09 EPS

1Q10 vs. 1Q09 EPS

39

Industrial Packaging Earnings

1Q10 vs. 1Q09

Industrial Packaging Earnings

1Q10 vs. 1Q09

Earnings before special items

40

Printing Papers Earnings

1Q10 vs. 1Q09

Printing Papers Earnings

1Q10 vs. 1Q09

Earnings before special items

41

$ Million

1Q09

4Q09

1Q10

Sales

$170

$300

$225

Earnings

$20

$33

$11

EBITDA Margin

26%

23%

20%

IP Brazil results are reported in the Printing Papers segment

IP Brazil

IP Brazil

1Q10 vs. 4Q09

1Q10 vs. 1Q09

Business

Volume

Price /

Ton

Volume

Price /

Ton

Uncoated Freesheet

(22%)

$6

35%

($84)

Domestic

(23%)

($22)

(3%)

($92)

Export

(21%)

$25

85%

($78)

42

Consumer Packaging Earnings

1Q10 vs. 1Q09

Consumer Packaging Earnings

1Q10 vs. 1Q09

Earnings before special items

43

Total Cash Cost Components

1Q10

Total Cash Cost Components

1Q10

North American Mills Only

44

Global Input & Freight Costs by Input

$88 MM, or $0.14/Share Unfavorable vs. 1Q09

Global Input & Freight Costs by Input

$88 MM, or $0.14/Share Unfavorable vs. 1Q09

Input costs for continuing businesses

45

NYMEX Natural Gas closing prices

Index: Jan 2005 Natural Gas Costs = 100

Natural Gas Costs

27% Increase vs. 4Q09 Average Cost

Natural Gas Costs

27% Increase vs. 4Q09 Average Cost

46

Index: Jan 2005 Wood Costs = 100

U.S. Mill Wood Costs

14% Increase vs. 4Q09 Average Cost

U.S. Mill Wood Costs

14% Increase vs. 4Q09 Average Cost

Delivered cost to U.S. facilities

47

U.S. Old Corrugated Containers Costs

62% Increase vs. 4Q09 Average Cost

U.S. Old Corrugated Containers Costs

62% Increase vs. 4Q09 Average Cost

Index: Jan 2005 OCC Costs = 100

2005-2007 represents WY PKG delivered costs; 2008-2009 represents delivered costs to the integrated system

48

U.S. Fuel Oil

Flat vs. 4Q09 Average Cost

U.S. Fuel Oil

Flat vs. 4Q09 Average Cost

Index: Jan 2006 Fuel Oil Costs = 100

WTI Crude prices

49

2010 Global Consumption

Annual Purchase Estimates for Key Inputs

2010 Global Consumption

Annual Purchase Estimates for Key Inputs

Does not include Asian or Ilim consumption

Estimates are based on normal operations and may be impacted by downtime

Commodity

U. S.

Non –

U. S.

Energy

Natural Gas (MM BTUs)

42,000,000

13,000,000

Fuel Oil (Barrels)

1,500,000

500,000

Coal (Tons)

860,000

260,000

Fiber

Wood (Tons)

44,200,000

8,800,000

Old Corrugated Containers (Tons)

3,000,000

310,000

Chemicals

Caustic Soda (Tons)

250,000

70,000

Starch (Tons)

394,000

96,000

Sodium Chlorate (Tons)

180,000

40,000

LD Polyethylene (Tons)

39,000

-

Latex (Tons)

22,000

4,000