<PAGE> 1
EXHIBIT 99.1
ROCK-TENN COMPANY REPORTS
FISCAL FOURTH QUARTER AND YEAR END RESULTS
Norcross, Ga., October 26, 2000 - Rock-Tenn Company (NYSE:RKT) today reported
net sales and earnings for the fourth fiscal quarter and year ended September
30, 2000.
FOURTH QUARTER
Net sales for the fourth fiscal quarter increased 4.8% to a record $376.0
million, compared to net sales of $358.7 million in the same quarter last year.
This sales increase was the result of higher volumes of promotional displays,
specialty corrugated packaging and plastic packaging and higher prices for
paperboard as compared to the fourth quarter of last year.
Net income was $6.1 million or $.18 per diluted share in the fourth quarter of
fiscal 2000 compared to $12.2 million or $.35 per diluted share in the same
quarter last year.
Net income, excluding plant closing costs, equipment write-downs and severance
costs, was $9.5 million or $.28 per diluted share in the fourth quarter. Net
income, excluding plant closing costs, was $12.8 million or $.36 per diluted
share in the same quarter last year.
Packaging Products segment sales in the fourth fiscal quarter increased 6.2% to
$253.0 million, a new record compared to $238.3 million in the fourth quarter of
fiscal 1999. Packaging Products segment operating income, excluding charges
related to plant closings, was $15.4 million in the fourth fiscal quarter of
2000. Paperboard segment sales in the fourth fiscal quarter increased slightly
to $114.0 million compared to $112.0 million in the prior year's fourth quarter.
Paperboard segment operating income was $8.8 million. The segment consisting of
our Laminated Paperboard, Plastic Packaging and Recycled Fiber divisions had
sales and operating income in the fourth fiscal quarter of $74.9 million and
$2.0 million, respectively.
FISCAL YEAR 2000
Net sales for the year ended September 30, 2000 increased 15.4% to $1.5 billion
compared to $1.3 billion in the prior year.
Net loss for the year ended September 30, 2000 was $15.9 million or $.46 per
diluted share compared to net income of $39.7 million or $1.13 per diluted share
in the prior year.
Fiscal 2000 net income, excluding asset impairment charges, plant closing costs,
equipment write-downs, severance costs and expected losses under a sales
contract, was $35.4 million or $1.02 per diluted share. Net income for fiscal
1999, excluding plant closing costs, was $44.0 million or $1.25 per diluted
share.
Packaging Products segment sales for fiscal 2000 increased 10% to $964.4 million
from to $876.4 million in fiscal 1999. Packaging Products segment operating
income, excluding plant closing costs, was $57.1 million for fiscal 2000.
Paperboard segment sales for fiscal 2000 increased 12% to $466.4 million from
$416.4 million in fiscal 1999. Paperboard segment operating income was $39.8
million. The segment consisting of our Laminated Paperboard, Plastic Packaging
and Recycled Fiber divisions increased 18% to $308.6 million for fiscal 2000
compared to $261.0 million in fiscal 1999. Operating income for this segment in
fiscal 2000 was $13.9 million.
During fiscal 2000, Rock-Tenn purchased over 2.1 million shares of company
common stock at a cost of $22.2 million, or an average cost of $10.47 per share.
Current Board authorizations provide for the
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repurchase of up to an additional 362,832 shares of common stock.
James A. Rubright, Chief Executive Officer, commented, "The fourth fiscal
quarter marked an improvement over the preceding quarter as a result of enhanced
operating efficiencies in our folding carton division, where restructuring
actions implemented earlier this year are paying strong dividends. Our
Paperboard segment results were impacted by lower production of uncoated
paperboard, high-energy costs, operating issues at one of our coated mills and
volume weakness in our laminated paperboard products business."
"Sales in our specialty corrugated packaging and display business increased 32%
to $233.5 million during fiscal 2000, including a 36% increase to $153.2 million
in our Alliance Display business. Alliance significantly increased its design
and marketing staff in fiscal 1999 and opened two new contract packing
facilities in fiscal 1999 and fiscal 2000 that contributed to its continued
growth in fiscal 2000. Sales in our plastics business increased 33% to $63.6
million during fiscal 2000, and were up 51% to $19.8 million in the fourth
fiscal quarter over the same period of the prior year as sales of our
DurafreshTM line of modified atmosphere packaging for case ready meats
accelerated in the fourth quarter."
Mr. Rubright continued, "The higher level of capital expenditures of $94.6
million recorded in fiscal 2000 exceeded our depreciation and amortization of
$77.1 million and reflects our strong investment in our growth businesses, our
commitment to increasing the quality and versatility of our paperboard mills and
capital investments in our folding carton division associated with our
restructuring earlier this year. We anticipate capital expenditures to remain at
similar levels in fiscal 2001 as we continue to fuel growth in our specialty
corrugated packaging and Alliance Display business and our plastic packaging
businesses."
"Demand continues to be strong in our coated paperboard business and packaging
businesses as we begin fiscal 2001. We expect that results for the mills will be
impacted by significantly higher energy costs at least during the fall and
winter months and soft markets for uncoated paperboard. We also see some
softening of demand in the specialty corrugated packaging markets. We expect
continued strong seasonally adjusted growth in our display business and our
plastic packaging business. Based on these conditions we would expect earning in
the first fiscal quarter of 2001, not including remaining closing costs from
plants closed in fiscal 2000, of between $.23 and $.27 per share."
Statements herein regarding expected capital expenditures in fiscal 2001,
expected levels of demand and the impact of higher energy costs constitute
forward-looking statements within the meaning of the Securities Act of 1933 and
the Securities Act of 1934. Such statements are subject to certain risks and
uncertainties that could cause actual amounts to differ materially from those
projected. With respect to these statements the Company has made assumptions
regarding projected energy and raw material costs and price levels, all of which
are volatile, the amount and timing of purchases by customers and the timing and
effects on operations of capital expenditures. The forward-looking statements
are subject to certain risks including, among others, that the foregoing
assumptions are inaccurate. Further, these forward-looking statements are
subject to a number of general risks including, among others, decreases in
demand for the Company's products, increases in raw material costs, fluctuations
in selling prices and adverse changes in general market and industry conditions.
Management believes its estimates are reasonable; however, undue reliance should
not be placed on such estimates, which are based on current expectations.
Rock-Tenn Company is one of North America's leading manufacturers of packaging,
100% recycled paperboard and laminated paperboard products, with sales of
approximately $1.5 billion and over 70 manufacturing operations in the United
States, Canada, Mexico and Chile.
The Company will host a conference call to discuss its fourth quarter and
year-end results and other topics that may be raised during the discussion at
11:00 a.m., EDT, on Thursday, October 26, 2000. The conference call will be
webcast and can be accessed at www.rocktenn.com. You will be required to
register prior to hearing the live webcast.
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ROCK-TENN COMPANY
FINANCIAL AND OPERATING HIGHLIGHTS
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AND TONNAGE AMOUNTS)
<TABLE>
<CAPTION>
Three Months Ended Twelve Months Ended
September 30, September 30, September 30, September 30,
2000 1999 2000 1999
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NET SALES:
Packaging Products Segment $ 253,039 $ 238,283 $ 964,358 $ 876,396
Paperboard Segment 113,999 112,001 466,415 416,428
Laminated Paperboard, Plastic Packaging
and Recycled Fiber Segment 74,891 74,672 308,568 260,994
Intersegment Eliminations (65,947) (66,222) (276,053) (240,447)
----------- ----------- ----------- -----------
TOTAL NET SALES $ 375,982 $ 358,734 $ 1,463,288 $ 1,313,371
=========== =========== =========== ===========
NET INCOME (LOSS) $ 6,125 $ 12,214 $ (15,916) $ 39,698
=========== =========== =========== ===========
Diluted Earnings (Loss) Per Share $ 0.18 $ 0.35 $ (0.46) $ 1.13
=========== =========== =========== ===========
Weighted Average Common Shares
Outstanding - Diluted 33,723 35,337 34,524 35,207
=========== =========== =========== ===========
SEGMENT OPERATING MARGIN:
Packaging Products Segment 6.1% 8.0% 5.9% 6.9%
Paperboard Segment 7.8% 11.3% 8.5% 12.5%
Laminated Paperboard, Plastic Packaging
and Recycled Fiber Segment 2.6% 4.7% 4.5% 2.6%
TONNAGE DATA:
Paperboard Shipped (in tons) 262,949 287,255 1,116,965 1,099,971
</TABLE>
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ROCK-TENN COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------
FOR THE THREE MONTHS ENDED FOR THE TWELVE MONTHS ENDED
September 30, September 30, September 30, September 30,
2000 1999 2000 1999
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NET SALES $ 375,982 $ 358,734 $ 1,463,288 $ 1,313,371
Cost of Goods Sold 302,995 278,907 1,174,837 1,019,214
---------------------------------------------------------------------------------------------------------------------------
Gross Profit 72,987 79,827 288,451 294,157
Selling, General and Administrative Expenses 42,627 46,288 177,961 170,779
Amortization of Goodwill 2,177 2,353 9,069 9,410
Plant Closing and Other Costs 5,555 1,031 65,630 6,932
---------------------------------------------------------------------------------------------------------------------------
Income from Operations 22,628 30,155 35,791 107,036
Interest Expense (10,192) (7,557) (35,575) (31,179)
Interest and Other Income 110 91 418 391
Minority Interest in Income of
Consolidated Subsidiary (1,174) (1,432) (4,980) (5,995)
---------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) BEFORE INCOME TAXES 11,372 21,257 (4,346) 70,253
PROVISION FOR INCOME TAXES 5,247 9,043 11,570 30,555
---------------------------------------------------------------------------------------------------------------------------
NET INCOME (LOSS) $ 6,125 $ 12,214 $ (15,916) $ 39,698
---------------------------------------------------------------------------------------------------------------------------
Weighted Average Common Shares
Outstanding-Diluted 33,723 35,337 34,524 35,207
---------------------------------------------------------------------------------------------------------------------------
Diluted Earnings (Loss) Per Share $ 0.18 $ 0.35 $ (0.46) $ 1.13
===========================================================================================================================
</TABLE>
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ROCK-TENN COMPANY
INDUSTRY SEGMENT INFORMATION
(UNAUDITED)
(IN THOUSANDS, EXCEPT TONNAGE DATA)
<TABLE>
<CAPTION>
============================================================================================================================
FOR THE THREE MONTHS ENDED FOR THE TWELVE MONTHS ENDED
September 30, September 30, September 30, September 30,
2000 1999 2000 1999
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
NET SALES:
Packaging Products Segment $ 253,039 $ 238,283 $ 964,358 $ 876,396
Paperboard Segment 113,999 112,001 466,415 416,428
Laminated Paperboard, Plastic Packaging
and Recycled Fiber Segment 74,891 74,672 308,568 260,994
Intersegment Eliminations (65,947) (66,222) (276,053) (240,447)
---------------------------------------------------------------------------------------------------------------------------
TOTAL $ 375,982 $ 358,734 $ 1,463,288 $ 1,313,371
---------------------------------------------------------------------------------------------------------------------------
INCOME (LOSS) BEFORE TAXES:
Packaging Products Segment $ 15,441 $ 19,097 $ 57,096 $ 60,646
Paperboard Segment 8,845 12,672 39,787 52,261
Laminated Paperboard, Plastic Packaging
and Recycled Fiber Segment 1,977 3,506 13,937 6,904
---------------------------------------------------------------------------------------------------------------------------
Segment Income 26,263 35,275 110,820 119,811
LIFO and Intercompany Profit 819 (1,167) (5,275) (167)
Plant Closing and Other Costs (5,555) (1,031) (65,630) (6,932)
Other Non-Allocated Expense 1,101 (2,922) (4,124) (5,676)
Interest Expense (10,192) (7,557) (35,575) (31,179)
Interest and Other Income 110 91 418 391
Minority Interest in Income of
Consolidated Subsidiary (1,174) (1,432) (4,980) (5,995)
---------------------------------------------------------------------------------------------------------------------------
TOTAL $ 11,372 $ 21,257 $ (4,346) $ 70,253
===========================================================================================================================
Paperboard Shipped (in tons) 262,949 287,255 1,116,965 1,099,971
===========================================================================================================================
</TABLE>
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ROCK-TENN COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
=============================================================================================================
FOR THE TWELVE MONTHS ENDED
September 30, 2000 September 30, 1999
-------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net (loss) income $ (15,916) $ 39,698
Items in income not affecting cash:
Depreciation and amortization 77,061 72,475
Deferred income taxes 316 3,383
(Gain) loss on disposal of property, plant and equipment (517) 746
Minority interest in income of consolidated subsidiary 4,980 5,995
Impairment loss and other non-cash charges 49,700 --
Net changes in operating assets and liabilities (13,180) (9,881)
-------------------------------------------------------------------------------------------------------------
CASH PROVIDED BY OPERATING ACTIVITIES 102,444 112,416
-------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net additions (repayments) to revolving credit facilities 32,147 (7,000)
Additions to long-term debt 5,454 3,034
Repayments of long-term debt (1,626) (5,527)
Debt issuance costs (1,811) (80)
Sales of common stock 3,748 3,148
Purchases of common stock (22,245) --
Cash dividends paid to shareholders (10,384) (10,450)
Distribution to minority interest (5,425) (5,950)
-------------------------------------------------------------------------------------------------------------
CASH USED FOR FINANCING ACTIVITIES (142) (22,825)
-------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash contributed to joint venture (7,133) --
Capital expenditures (94,640) (92,333)
Proceeds from sale of property, plant and equipment 2,209 1,127
Increase in unexpended industrial revenue bond proceeds (1,779) --
-------------------------------------------------------------------------------------------------------------
CASH USED FOR INVESTING ACTIVITIES (101,343) (91,206)
-------------------------------------------------------------------------------------------------------------
Effect of exchange rate changes on cash (48) 384
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 911 (1,231)
Cash and cash equivalents:
Beginning of period 4,538 5,769
-------------------------------------------------------------------------------------------------------------
End of period $ 5,449 $ 4,538
-------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Income taxes (net of refunds) $ 16,655 $ 28,899
Interest (net of amounts capitalized) 36,228 31,190
=============================================================================================================
</TABLE>
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ROCK-TENN COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(IN THOUSANDS)
<TABLE>
<CAPTION>
========================================================================================
SEPTEMBER 30, SEPTEMBER 30,
2000 1999
----------------------------------------------------------------------------------------
ASSETS:
<S> <C> <C>
Cash and cash equivalents $ 5,449 $ 4,538
Receivables - net 156,155 139,034
Inventories - at LIFO cost 99,589 94,501
Other current assets 8,050 5,308
----------------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 269,243 243,381
----------------------------------------------------------------------------------------
Property, plant and equipment - net 592,538 592,739
Intangible and other assets 297,182 325,350
----------------------------------------------------------------------------------------
TOTAL ASSETS $1,158,963 $1,161,470
========================================================================================
LIABILITIES AND
SHAREHOLDERS' EQUITY:
Current maturities of long-term debt $ 20,328 $ 41,435
Other current liabilities 140,047 127,475
----------------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 160,375 168,910
----------------------------------------------------------------------------------------
Long-term debt 514,492 457,410
Deferred income taxes 81,384 85,631
Other long-term items 16,409 17,355
Shareholders' equity 386,303 432,164
----------------------------------------------------------------------------------------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $1,158,963 $1,161,470
========================================================================================
</TABLE>
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ROCK-TENN COMPANY QUARTERLY STATISTICS
<TABLE>
<CAPTION>
AVERAGE AVERAGE AVERAGE UNCOATED COATED MEDIUM AVERAGE
PRICE PRICE PRICE TONS TONS TONS TOTAL TONS RECOVERED DILUTED CASH
PAPERBOARD MEDIUM ALL TONS SHIPPED SHIPPED SHIPPED SHIPPED PAPER COST EPS GENERATED
---------- ------ -------- ------- ------- ------- ------- ---------- --- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <S> <C> <C>
1Q 1998 420 330 406 117,274 124,689 45,025 286,988 70 0.25 12,378
2Q 1998 420 347 408 114,346 121,867 45,630 281,843 68 0.28 30,709
3Q 1998 417 338 405 112,466 112,927 40,748 266,141 59 0.34 43,135
4Q 1998 414 318 398 110,242 109,721 43,936 263,899 58 0.34 39,466
----------------------------------------------------------------------------------------------------------------------
FISCAL 1998 418 332 404 454,328 469,204 175,339 1,098,871 64 1.20 125,688
----------------------------------------------------------------------------------------------------------------------
1Q 1999 403 288 384 109,100 112,641 45,163 266,904 53 0.25 47,188
2Q 1999 399 328 387 110,147 108,401 43,470 262,018 52 0.25 4,404
3Q 1999 398 340 389 119,531 118,926 45,337 283,794 58 0.28 28,449
4Q 1999 406 388 398 122,350 120,141 44,764 287,255 76 0.35 32,375
----------------------------------------------------------------------------------------------------------------------
FISCAL 1999 401 336 391 461,128 460,109 178,734 1,099,971 60 1.13 112,416
----------------------------------------------------------------------------------------------------------------------
1Q 2000 420 386 415 119,446 123,114 42,371 284,931 83 0.24 12,852
2Q 2000 426 403 423 122,240 127,569 44,689 294,498 91 (0.96) 16,624
3Q 2000 445 419 441 115,070 118,616 40,901 274,587 108 0.07 32,983
4Q 2000 449 407 443 102,628 118,068 42,253 262,949 88 0.18 39,985
----------------------------------------------------------------------------------------------------------------------
FISCAL 2000 435 403 430 459,384 487,367 170,214 1,116,965 92 (0.46) 102,444
----------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
PACKAGING PACKAGING RETURN ON PAPERBOARD PAPERBOARD RETURN ON LPR* LPR* RETURN ON NON-ALLOCATED
SALES INCOME SALES SALES INCOME SALES SALES INCOME SALES EXPENSES
----- ------ ----- ----- ------ ----- ----- ------ ----- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1Q 1998 211,108 9,068 4.3% 113,156 16,939 15.0% 70,018 416 0.6% (806)
2Q 1998 215,584 9,974 4.6% 111,120 17,374 15.6% 72,672 2,346 3.2% (1,732)
3Q 1998 214,786 11,688 5.4% 104,938 17,945 17.1% 66,365 1,924 2.9% (1,443)
4Q 1998 220,302 16,409 7.4% 102,035 14,775 14.4% 68,383 1,709 2.5% (1,714)
--------------------------------------------------------------------------------------------------------------------
FISCAL 1998 861,780 47,139 5.5% 431,249 67,033 15.4% 277,438 6,395 2.3% (5,695)
--------------------------------------------------------------------------------------------------------------------
1Q 1999 210,740 13,901 6.6% 100,198 13,560 13.5% 59,957 136 0.2% (2,272)
2Q 1999 209,108 13,972 6.7% 97,197 10,722 11.0% 61,007 1,533 2.5% (1,289)
3Q 1999 218,265 13,676 6.3% 107,032 15,307 14.3% 65,358 1,729 2.6% (4,094)
4Q 1999 238,283 19,097 8.0% 112,001 12,672 11.3% 74,672 3,506 4.7% (5,120)
--------------------------------------------------------------------------------------------------------------------
FISCAL 1999 876,396 60,646 6.9% 416,428 52,261 12.5% 260,994 6,904 2.6% (12,775)
--------------------------------------------------------------------------------------------------------------------
1Q 2000 230,022 11,171 4.9% 115,130 13,679 11.8% 70,698 3,205 4.5% (3,558)
2Q 2000 238,701 14,228 6.0% 120,321 10,985 9.1% 80,777 4,954 6.1% (57,260)
3Q 2000 242,596 16,256 6.7% 116,965 6,278 5.4% 82,202 3,801 4.6% (10,576)
4Q 2000 253,039 15,441 6.1% 113,999 8,845 7.8% 74,891 1,977 2.6% (3,635)
--------------------------------------------------------------------------------------------------------------------
FISCAL 2000 964,358 57,096 5.9% 466,415 39,787 8.5% 308,568 13,937 4.5% (75,029)
--------------------------------------------------------------------------------------------------------------------
</TABLE>
*This column includes combined information on the Company's Laminated Paperboard
Products, Plastic Packaging and Recycled Fiber Divisions.
14
