UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of report (Date of earliest event reported): April 18, 2011
Packaging Corporation of America
(Exact name of registrant as specified in its charter)
| Delaware (State or other jurisdiction of incorporation) |
1-15399 (Commission File Number) |
36-4277050 (IRS Employer Identification No.) |
1900 West Field Court, Lake Forest, Illinois 60045
(Address of Principal Executive Offices, including Zip Code)
(Address of Principal Executive Offices, including Zip Code)
(847) 482-3000
(Registrant’s Telephone Number, Including Area Code)
(Registrant’s Telephone Number, Including Area Code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2 (b) under the Exchange Act (17 CFR
240.14d-2 (b))
o Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR
240.13e-4 (c))
Item 2.02. Results of Operations and Financial Condition.
The information furnished in this Current Report on Form 8-K, including the exhibit described
below, shall not be deemed “filed” hereunder for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the
Securities Exchange Act of 1933, as amended, or the Exchange Act, except as shall be expressly set
forth by specific reference in such a filing.
On April 18, 2011, Packaging Corporation of America issued a press release announcing first
quarter 2011 financial results. The press release is furnished as Exhibit 99.1 to this report on
Form 8-K and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(D) Exhibits
99.1 First Quarter 2011 Earnings Press Release dated April 18, 2011.
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.
| PACKAGING CORPORATION OF AMERICA (Registrant) |
||||
| By: | /s/ MARK W. KOWLZAN | |||
| Chief Executive Officer | ||||
| By: | /s/ RICHARD B. WEST | |||
| Senior Vice President and Chief Financial Officer | ||||
Date: April 18, 2011
Exhibit 99.1
PACKAGING CORPORATION OF AMERICA REPORTS RECORD FIRST QUARTER 2011 RESULTS
Lake Forest, IL, April 18, 2011 — Packaging Corporation of America (NYSE: PKG) today reported
record first quarter net income of $37 million, or $0.37 per share. Reported results include
after-tax, non-cash charges totaling $2 million, or $0.02 per share, from asset disposals related
to major energy projects. Reported results for the first quarter of 2010 were $19 million, or
$0.19 per share, which included income of $9 million, or $0.09 per share, from alternative fuel
mixture tax credits and asset disposal charges of $3 million, or $0.02 per share. Net sales were a
first quarter record $630 million, up 14% compared to first quarter 2010 net sales of $551 million.
Excluding asset disposal charges, net income was $39 million, or $0.39 per share, compared to first
quarter 2010 net income, excluding fuel credits and asset disposal charges, of $12 million, or
$0.12 per share. This $0.27 per share increase in earnings was driven by higher containerboard and
corrugated products price and mix ($0.35) and volume ($0.06). These increases were partially
offset by lost volume and higher costs from severe weather ($0.02), and increased costs for
transportation ($0.03), chemicals ($0.03), medical and worker’s compensation ($0.02), incentive
compensation ($0.02), and labor ($0.02).
Total corrugated products shipments were up 3.1% compared to last year’s first quarter, and outside
sales of containerboard were up 1.0%. Containerboard production was 602,000 tons, up 33,000 tons
over the first quarter of 2010. PCA ended the quarter with its containerboard inventories down
about 8,000 tons below 2010 year-end levels.
Commenting on the first quarter, Mark W. Kowlzan, Chief Executive Officer of PCA, said, “We
achieved record earnings despite severe weather issues and two annual maintenance outages. These
earnings were driven by higher prices, strong corrugated products volume and highly productive mill
operations. Our corrugated products shipments were the highest since our record first quarter 2006
shipments, and in March, we set an all-time monthly shipments record. These strong results were
partially offset by continuing cost inflation, particularly for chemicals and transportation.”
“Looking ahead,” Mr. Kowlzan added, “we will complete the bulk of our annual maintenance and major
capital project work in the second quarter which will result in production losses totaling 39,000
tons, or 17,000 tons higher than the first quarter. The higher production losses will also result
in higher outage related costs, including repairs. Costs for chemicals, transportation and energy
are also expected to increase. Corrugated products shipments are expected to increase and energy
usage will be lower with warmer weather. Considering these items, we currently expect second
quarter earnings of about $0.35 per share.”
PCA is the fifth largest producer of containerboard and corrugated packaging products in the United
States with sales of $2.44 billion in 2010. PCA operates four paper mills and 68 corrugated
products plants in 26 states across the country.
CONTACT:
Barbara Sessions
Packaging Corporation of America
INVESTOR RELATIONS: (877) 454-2509
PCA’s Website: www.packagingcorp.com
Packaging Corporation of America
INVESTOR RELATIONS: (877) 454-2509
PCA’s Website: www.packagingcorp.com
Conference Call Information:
WHAT:
|
Packaging Corporation of America’s 1st Quarter 2011 Earnings | |
| Conference Call | ||
WHEN:
|
Tuesday, April 19, 2011 | |
| 10:00 a.m. Eastern Time | ||
NUMBER:
|
(866) 219-5268 (U.S. and Canada) or (703) 639-1120 (International) | |
| Dial in by 9:45 a.m. Eastern Time | ||
| Conference Call Leader: Mr. Mark Kowlzan | ||
WEBCAST:
|
http://www.packagingcorp.com |
REBROADCAST DATES: |
April 19, 2011 2:00 p.m. Eastern Time through | |
| May 11, 2011 11:59 p.m. Eastern Time | ||
REBROADCAST NUMBER: |
(888) 266-2081 (U.S. and Canada) or (703) 925-2533 (International) | |
| Passcode: 1523611 |
Some of the statements in this press release are forward-looking statements. Forward-looking
statements include statements about our future earnings and financial condition, our industry and
our business strategy. Statements that contain words such as “ will”, “should”, “anticipate”,
“believe”, “expect”, “intend”, “estimate”, “hope” or similar expressions, are forward-looking
statements. These forward-looking statements are based on the current expectations of PCA.
Because forward-looking statements involve inherent risks and uncertainties, the plans, actions and
actual results of PCA could differ materially. Among the factors that could cause plans, actions
and results to differ materially from PCA’s current expectations include the following: the impact
of general economic conditions; containerboard and corrugated products general industry conditions,
including competition, product demand and product pricing; fluctuations in wood fiber and recycled
fiber costs; fluctuations in purchased energy costs; the possibility of unplanned outages or
interruptions at our principal facilities; and legislative or regulatory requirements, particularly
concerning environmental matters, as well as those identified under Item 1A. Risk Factors in PCA’s
Annual Report on Form 10-K for the year ended December 31, 2010 filed with the Securities and
Exchange Commission and available at the SEC’s website at “www.sec.gov”.
Packaging Corporation of America
Consolidated Earnings Results
Consolidated Earnings Results
Unaudited
| Three Months Ended March 31, | ||||||||
| (in millions, except per share data) | 2011 | 2010 | ||||||
Net sales |
$ | 629.5 | $ | 550.7 | ||||
Cost of sales |
(496.4 | ) | (463.9 | ) | ||||
Gross profit |
133.1 | 86.8 | ||||||
Selling and administrative expenses |
(47.9 | ) | (44.3 | ) | ||||
Corporate overhead |
(15.6 | ) | (12.6 | ) | ||||
Other income (expense), net |
(3.7 | ) | 3.7 | |||||
Income before interest and taxes |
65.9 | 33.6 | ||||||
Interest expense, net |
(6.9 | ) | (8.7 | ) | ||||
Income before taxes |
59.0 | 24.9 | ||||||
Provision for income taxes |
(21.6 | ) | (5.7 | ) | ||||
Net income |
$ | 37.4 | $ | 19.2 | ||||
Earnings per share: |
||||||||
Basic |
$ | 0.37 | $ | 0.19 | ||||
Diluted |
$ | 0.37 | $ | 0.19 | ||||
Basic common shares outstanding |
100.7 | 101.9 | ||||||
Diluted common shares outstanding |
101.9 | 102.9 | ||||||
Supplemental financial information: |
||||||||
Cash balance |
$ | 173.0 | $ | 197.6 | ||||
Capital spending |
$ | 64.7 | $ | 63.1 | ||||
Packaging Corporation of America
Reconciliation of Non-GAAP Financial Measures (1)
Reconciliation of Non-GAAP Financial Measures (1)
Unaudited
| Three Months Ended March 31, | ||||||||||||||||
| 2011 | 2010 | |||||||||||||||
| (in millions, except per share data) | Net Income | EPS | Net Income | EPS | ||||||||||||
As reported |
$ | 37.4 | $ | 0.37 | $ | 19.2 | $ | 0.19 | ||||||||
Special items: |
||||||||||||||||
Alternative fuel mixture tax credits (2) |
— | — | (9.2 | ) | (0.09 | ) | ||||||||||
Asset disposal charges/closure costs (3) |
2.1 | 0.02 | 2.5 | 0.02 | ||||||||||||
Total special items |
2.1 | 0.02 | (6.7 | ) | (0.07 | ) | ||||||||||
Excluding special items |
$ | 39.5 | $ | 0.39 | $ | 12.5 | $ | 0.12 | ||||||||
Notes to Reconciliation of Non-GAAP Financial Measures
| (1) | Net income and earnings per share excluding special items are non-GAAP financial measures. The after-tax effect of special items are excluded as management considers such items to be unusual in nature. Management uses these measures to focus on PCA’s on-going operations and believes that it is useful to investors because it enables them to perform meaningful comparisons of past and present operating results. | |
| (2) | Represents additional income from the 2009 alternative fuel mixture tax credits. | |
| (3) | Represents charges from asset disposals related to major energy projects and, additionally for 2010 only a plant closure. |