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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
Date of Report: January 24, 1996
FEDERAL PAPER BOARD COMPANY, INC.
(Exact Name of Registrant as Specified in its Charter)
NORTH CAROLINA
(State or Other Jurisdiction of Incorporation)
1-3838 22-0904830
(Commission File Number) (IRS Employer Identification Number)
75 CHESTNUT RIDGE ROAD, MONTVALE, NEW JERSEY 07645
(Address of Principal Executive Offices) (Zip Code)
(201) 391-1776
(Registrant's Telephone Number, including Area Code)
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INFORMATION INCLUDED IN THIS REPORT
Item 5. OTHER EVENTS.
On January 24, 1996, Federal Paper Board Company, Inc. (the
"Registrant") issued a press release announcing (a) its preliminary, unaudited
earnings, sales and net income for the 16 weeks and 52 weeks ended December 30,
1995 and (b) the Department of Justice's decision not to proceed further with
its review of the proposed merger between the Registrant and Focus Merger Co.,
Inc., a wholly owned subsidiary of International Paper Company.
A copy of the press release issued by the Registrant on January
24, 1996 is attached hereto as Exhibit 99.1 and is hereby incorporated by
reference in its entirety.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Businesses Acquired.
NOT APPLICABLE.
(b) Pro Forma Financial Information.
NOT APPLICABLE
(c) EXHIBITS
99.1 Press Release issued by Federal Paper Board
Company, Inc. on January 24, 1996
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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 hereunto duly authorized.
FEDERAL PAPER BOARD COMPANY, INC.
Date: February 5, 1996 By: /s/ Quentin J. Kennedy
-------------------------
Name: Quentin J. Kennedy
Title: Director, Executive Vice
President and Secretary
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INDEX TO EXHIBITS
Exhibit
99.1 Press Release issued by Federal Paper Board Company, Inc. on
January 24, 1996.
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EXHIBIT 99.1
------------
[FEDERAL PAPER BOARD COMPANY, INC. LETTERHEAD]
FOR: FEDERAL PAPER BOARD COMPANY, INC.
CONTACT: Quentin J. Kennedy
Executive Vice President
Federal Paper Board Company, Inc.
(201) 391-1776
FOR IMMEDIATE RELEASE:
Wednesday, January 24, 1996
MONTVALE, NEW JERSEY (January 24, 1996) -- Federal Paper Board Company, Inc.
(NYSE:FBO) today announced record earnings for 1995 of $211.4 million or $4.34
per fully diluted common share before a non-recurring after-tax charge of $69.1
million or $1.42 per fully diluted common share associated with the
restructuring of the Imperial Bondware cup operations. Record sales for 1995 of
$1,913.1 million were up 21.9 percent compared to $1,569.6 million last year.
Net income for 1995 was $142.3 million or $2.92 per fully diluted common share
compared to $72.0 million or $1.52 per fully diluted common share last year.
Included in this year's results is a non-recurring pre-tax charge of $82.1
million which includes a write-off of goodwill which is not deductible for tax
purposes. Net income for 1994 included favorable adjustments of $8.9 million or
$0.21 per fully diluted common share associated with the settlement of prior
year tax audits and the cumulative recalculation of the deferred tax liability
reflecting a change in the effective state tax rate.
Record sales for the sixteen weeks ended December 30, 1995, were $556.1
million compared to $528.3 million for the same period last year. Net loss for
the fourth quarter of 1995 was $17.9 million or $.38 per fully diluted common
share compared to net income of $48.1 million or $1.02 per fully diluted common
share for the fourth quarter of 1994. Fourth quarter earnings for 1995 include
a non-recurring (pre-tax charge of $78.1 million) after-tax charge of $66.8
million or $1.42 per fully diluted common share related to the restructuring of
the Imperial Bondware cup operations. Fourth quarter earnings before a
non-recurring charge were $48.9 million or $1.04 per fully diluted common share.
- More -
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FEDERAL PAPER BOARD COMPANY, INC.
Page 2
John R. Kennedy, President, stated "We are generally pleased with the
Company's overall performance in 1995, but were disappointed with the fourth
quarter operating results. Our primary businesses, market pulp and bleached
paperboard, performed very well in the first three quarters of 1995 benefiting
from strong demand and improved selling prices, but began to deteriorate during
the fourth quarter of this year."
Mr. Kennedy further stated, "The Department of Justice has decided not
to proceed further with its review of the proposed merger between Federal Paper
Board and International Paper. We expect the merger between the two companies
to be completed in the first quarter of 1996. The merger will enhance
shareholder value while continuing to provide an exceptionally high quality of
products and service to our customers."
Federal Paper Board Company, Inc. manufactures and sells solid bleached
paperboard, bleached market pulp, recycled paperboard, paper cups, folding
cartons, lumber and uncoated free-sheet paper. The Company operates two
bleached kraft paperboard and pulp mills, a recycled paperboard mill, four
sheeting and distribution centers, an extrusion coating plant, three cup
plants, four folding carton plants and five wood products mills in the United
States along with an uncoated free-sheet paper mill and a sheeting and
distribution center in the United Kingdom. Federal employs approximately 6,500
people.
###
(Tables Attached)
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FEDERAL PAPER BOARD COMPANY, INC.
PRELIMINARY RESULTS
INDUSTRY SEGMENT INFORMATION
(Unaudited)
<TABLE>
<CAPTION>
For the For the
(In millions) Sixteen Weeks Ended Fifty-Two Weeks Ended
- ------------- --------------------- ---------------------
Dec. 30, Dec. 31, Dec. 30, Dec. 31,
1995 1994 1995 1994
-------- -------- -------- --------
<S> <C> <C> <C> <C>
NET SALES:
Paper, Paperboard and Pulp $397.3 $373.5 $1,417.5 $1,071.0
Wood Products 67.8 83.6 244.5 267.9
Converting Operations 122.2 108.5 374.8 346.1
Intersegment Eliminations (31.2) (37.3) (123.7) (115.4)
------ ------ -------- --------
Total $556.1 $528.3 $1,913.1 $1,569.6
====== ====== ======== ========
INCOME (LOSS) BEFORE TAXES:
Paper, Paperboard and Pulp $109.2 $ 87.2 $ 425.9 $ 157.3
Wood Products 1.1 16.6 21.4 69.9
Converting Operations(A) (77.6) (0.7) (75.4) 7.2
Intersegment Eliminations 2.4 (1.1) (4.5) (0.8)
General Corporate Expense-Net (10.6) (5.8) (30.0) (44.4)
Interest Expense (26.4) (29.2) (89.8) (88.3)
------ ------ -------- --------
Total $ (1.9) $ 67.0 $ 247.6 $ 100.9
====== ====== ======== ========
</TABLE>
- ----------
(A) Converting Operations includes a non-recurring charge of $78.1 million and
$82.1 million in the fourth quarter and year-to-date periods of 1995,
respectively, associated with the previously announced restructuring of the
Company's Imperial Bondware cup operations.
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FEDERAL PAPER BOARD COMPANY, INC.
PRELIMINARY RESULTS
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
For the For the
(In millions except per share amounts) Sixteen Weeks Ended Fifty-Two Weeks Ended
- -------------------------------------- ------------------------- ---------------------------
Dec. 30, Dec. 31, Dec. 30, Dec. 31,
1995 1994 1995 1994
-------- ------- -------- --------
<S> <C> <C> <C> <C>
NET SALES $556.1 $528.3 $1,913.1 $1,569.6
Costs and Expenses:
Cost of Products Sold 374.2 364.3 1,253.4 1,143.4
Depreciation, Amortization &
Cost of Timber Harvested 47.0 46.2 153.3 146.4
Selling and Administrative Expenses 33.4 26.9 96.9 74.2
Interest Expense 26.4 29.2 89.8 88.3
Other-Net (A) 77.0 (5.3) 72.1 16.4
------ ------ -------- --------
Total Costs and Expenses 558.0 461.3 1,665.5 1,468.7
------ ------ -------- --------
Income (Loss) before Taxes (1.9) 67.0 247.6 100.9
Provision for Income Taxes (B) 16.0 18.9 105.3 28.9
------ ------ -------- --------
Net Income (Loss) $(17.9) $ 48.1 $ 142.3 $ 72.0
====== ====== ======== ========
AVERAGE COMMON SHARES OUTSTANDING:
Assuming No Dilution 47.2 42.5 44.9 42.3
Assuming Full Dilution (C) 47.2 47.4 48.7 43.2
INCOME PER COMMON SHARE:
Assuming No Dilution ($0.38) $1.09 $3.11 $1.55
Assuming Full Dilution (C) ($0.38) $1.02 $2.92 $1.52
(A) Other-net for the fourth quarter and year-to-date periods of 1995 includes
non-recurring charges of $78.1 million and $82.1 million, respectively,
related to the restructuring of the Imperial Bondware cup operations. The
year-to-date period of 1995 also includes a gain of $9.5 million on the sale
of certain assets.
(B) The increase in the 1995 tax provision was triggered by the write-off of
goodwill associated with the restructuring of the Imperial Bondware cup
operations which is not deductible for tax purposes. Fiscal year 1994
includes favorable adjustments of $2.9 million due to the settlement of
prior year tax audits and $6.0 million due to the cumulative recalculation
of deferred taxes reflecting a change in the Company's state effective tax
rate.
(C) Earnings per common share assuming full dilution is based on the weighted
average number of common shares outstanding including the dilutive effects
of stock options outstanding and the conversion of the Company's preferred
stock.
</TABLE>
