FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 25049
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Act of 1934
Date of Report (Date of earliest event reported): November 4, 1998.
Stone Container Corporation
(Exact name of registrant as specified in its charter)
Delaware 1-3439 36-2041256
(State or other jurisdiction (Commission file (IRS Employer
of incorporation) Number) Identification Number)
150 North Michigan Avenue, Chicago, Illinois 60601-7568
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code: (312) 346-6600
Not applicable
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS.
On November 4,1998, Stone Container Corporation issued a news
release announcing its third quarter financial results. The news release
is attached as Exhibit 99.1 herto and incorporated by reference herein.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
(a) -- (b) Not applicable.
(c) Exhibits.
99.1 News release of Stone Container dated November 4, 1998.
SIGNATURE
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.
STONE CONTAINER CORPORATION
Date: Novmeber 5, 1998 By: LESLIE T. LEDERER
Vice President
EXHIBIT INDEX
Exhibit
Number
Description of Exhibit
99.1 News release ofStone Contianer dated November 4, 1998
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
STONE CONTAINER REPORTS THIRD-QUARTER FINANCIAL RESULTS
- ----------------------------------------------------------
CHICAGO, Nov. 4, 1998 -- Stone Container Corporation (NYSE: STO) today reported
a third-quarter 1998 net loss of $275.5 million, or $2.66 per common share,
which does not include any tax benefit on losses incurred by U.S.
operations. The third quarter results include non-recurring pre-tax charges
of $59 million (consisting primarily of asset write-downs), and
approximately $23 million for downtime at paper mills to balance
inventories. Additionally, the third quarter results include foreign
exchange transaction losses of approximately $27 million incurred by a Canadian
affiliate. Pursuant to accounting standards, third-quarter results also
include the impact of establishing reserves against deferred tax assets on
net operating loss carryforwards which may not be realizable in the future.
The $275.5 million loss compares to a third-quarter 1997 net loss of $98.7
million, or $1.01 per common share, and a second-quarter 1998 net loss of
$156.6 million, or $1.59 per common share.
Revenues for the third quarter were $1.22 billion, compared to $1.18 billion
in the third quarter of 1997, and $1.20 billion for the second quarter of 1998.
"Our poor operating performance during the third quarter resulted mainly
from adverse market conditions for containerboard, corrugated containers
and market pulp, and from the results at our affiliates, principally
Abitibi-Consolidated and Venepal," said Chairman, President and CEO
Roger W. Stone.
Among all grades of paper and pulp, Stone Container took 225,000 tons of
downtime at its North American mills, including Florida Coast Paper,
during the third quarter. Of that amount, more than 83 percent, or 188,000
tons, was related to inventory reduction.
Stone Container stockholders will vote on Nov. 17 on a proposed merger
with St. Louis-based Jefferson Smurfit Corp. (Nasdaq:JJSC). Stone Container
and Jefferson Smurfit mailed a joint Merger Proxy Statement to their
respective stockholders in early October. Both companies will hold special
stockholder meetings at 10:30 a.m. on Nov. 17 for stockholders of record as
of Sept. 29, to vote on the proposed merger, which was announced on May 10.
Stone Container Corporation is the world's largest unbleached paper and
packaging producer. Its product lines include containerboard, corrugated
containers, kraft paper, and paper bags and sacks. Headquartered in Chicago,
the company has manufacturing facilities and sales offices in North America,
Europe, Central and South America, Australia, and Asia.
Forward-looking statements in this release are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements are subject to risks and uncertainties,
and actual results could differ materially. Such risks and uncertainties
include, but are not limited to, general economic and business conditions
both in the U.S., and globally, competitive market pricing, increases in raw
material, energy and other manufacturing costs, fluctuations in demand for
the Company's products, potential equipment malfunctions, and pending
litigation. For additional information, see the Company's annual report
of Form 10-K for the most recent fiscal year and Form 10-Q for the most
recent fiscal quarter.
Contact:
Bruce J. Byots John Simley
Investor Relations Media Relations
(312) 580-4663 (312) 649-7867
<TABLE>
STONE CONTAINER CORPORATION (NYSE)
SUMMARY (a)
<CAPTION>
Three months ended Nine months ended
Sept. 30, Sept. 30,
(dollars in millions except per share amounts)
1998 1997 1998 1997
<C> <C> <C> <C> <C>
Net sales $1,218.2 $1,182.8 $3,757.4 $3,563.9
Loss before interest and taxes (131.7) (35.2) (190.7) (124.2)
Interest expense (117.4) (114.7) (354.7) (340.9)
Loss before income taxes and
Minority interest (249.1) (149.9) (545.4) (465.1)
(Provision) Credit for
income taxes (26.4) 51.3 44.7 162.4
Minority interest -- (.1) (.1) (.1)
Loss before
extraordinary charges (275.5) (98.7) (500.8) (302.8)
Extraordinary charges
(net of income tax benefit) -- -- (.4) (13.3)
Net loss $(275.5) $(98.7) $(501.2) $(316.1)
Net loss applicable
to common shares $(277.5) $(100.7) $(507.3) $(322.1)
Per share of common stock:
Basic/Diluted:
Loss before
extraordinary charges $(2.66) $(1.01) $(5.01) $(3.11)
Extraordinary charges
(net of income tax benefit) -- -- -- (.13)
Net loss $(2.66) $(1.01) $(5.01) $(3.24)
Average common shares
outstanding (in millions) 104.3 99.3 101.3 99.3
Additional Information:
Total debt
(at Sept. 30 & Dec. 31) $4,529.0 $4,351.4
Capital expenditures 41.7 35.2 $109.3 $93.2
Depreciation & amortization 67.6 73.9 203.6 233.5
Worldwide Unit Statistics
(in thousands of short tons, except where noted):
Mill tonnage produced:
Containerboard and
kraft paper (b) 1,337 1,350 4,057 3,942
Publication papers (c) 201 356 912 1,005
Market pulp (d)(e) 163 303 650 870
Other 19 20 61 63
Total mill tonnage produced 1,720 2,029 5,680 5,880
Containerboard and
kraft paper converted 1,195 1,149 3,509 3,338
Corrugated shipments
(in billions of square feet) 15.1 14.3 44.3 41.4
Paper bag and sack shipments (f) 128 134 375 382
<FN>
Notes:
(a) Subject to year-end audit.
(b) Includes 50 percent of the Florida Coast mill.
(c) Includes 46.6 percent of Stone-Consolidated Corporation through May 1997
and 25.2 percent of Abitibi-Consolidated, Inc. starting June 1997.
(d) Includes 45 percent of the Celgar mill through March 1997, 100 percent
of the Celgar mill for April - June 1997 and 69 percent of the Celgar mill
from July 1997 through June 1998.
(e) Includes Celgar tons of nil for the third quarter of 1998, 145 for the
third quarter of 1997, 124 for the first nine months of 1998 and 296
for the first nine months of 1997.
(f) Includes 65 percent of S&G Packaging.
</TABLE>
