Boise Inc.

$BZ - NYSE - Packaging and Containers
0 LAST
0 CHANGE $
0 CHANGE %
loader
ON 0
WATCHLISTS

COMMUNIQUÉ DETAILS

posts/post

Press Release $BZ Boise Inc.

0 COMMENTs 26 Feb
Up 0 0 Down
Boise Inc. Reports Financial Results for Fourth Quarter and Year End 2012


BOISE, Idaho - Boise Inc. (NYSE: BZ) today reported net income of $13.5 million,
or $0.13 per diluted share, for fourth quarter 2012, compared with net income of
$16.3 million, or $0.15 per diluted share, for fourth quarter 2011. Net income
for the year ended 2012 was $52.2 million, or $0.52 per diluted share, compared
with $75.2 million, or $0.70 per diluted share, for the year ended 2011. Net
income excluding special items for the year ended 2012 was $71.6 million,
compared with $79.9 million for the year ended 2011.

EBITDA excluding special items (1) was $78.7 million for fourth quarter 2012,
compared with EBITDA excluding special items of $85.0 million for fourth quarter
2011. EBITDA excluding special items was $331.8 million for the year ended
2012, versus our record 2011 EBITDA excluding special items of $340.2 million.

2012 Highlights

-Record annual sales of $2.56 billion, a 6% increase over 2011
-EBITDA excluding special items of $331.8 million for 2012 and $78.7 million for
4Q 2012 (1)
-Special items include pretax costs of $31.7 million, primarily related to
ceasing uncoated freesheet production at our paper mill in St. Helens, Oregon
-Generated annual free cash flow of $97.4 million (1)
-Paid two special cash dividends totaling $1.20 per common share, or $119.7
million

"We were pleased with our overall 2012 operating results," said Alexander
Toeldte, president and chief executive officer of Boise Inc. "Our mills and
converting operations ran well, and we reduced costs through productivity
improvement by reducing usage of key raw materials. During the year, we
generated significant free cash flow and returned capital to our shareholders
through the payment of two special cash dividends totaling $1.20 per common
share. Despite these achievements, our 2012 results were affected adversely by
margin compression in some of our Packaging operations and declining prices in
our Paper business."

"In Packaging, we experienced margin compression in some of our converting
operations, primarily in our California and Texas markets. We saw little benefit
from the announced $50 per ton linerboard price increase during the fourth
quarter in our converting operations, but we expect to more fully benefit from
the increase in first quarter 2013.  As of January 31, 2013, we had implemented
over 90% of the $50 price increase through our converting operations. We are
making targeted capital investments in our converting operations to improve
efficiency and keep pace with our sales growth."

"In Paper, we faced declining prices for communication-grade papers throughout
the year, particularly in the fourth quarter. The average price for uncoated
freesheet in the fourth quarter 2012 declined $27 per ton from the previous
quarter and dropped $45 per ton from the fourth quarter 2011, as industry supply
continued to outpace demand. These dynamics factored heavily into our decision
to cease paper production at our mill in St. Helens, Oregon, reducing our
production capacity in 2013 by 60,000 tons. During fourth quarter, we took
16,000 tons of market-related downtime in addition to the 8,000 tons of downtime
from our annual maintenance outage at our mill in Jackson, Alabama. Going
forward, we will continue to aggressively manage our costs and evaluate the
optimal configuration of our white paper assets, to balance our production with
demand for our products."

                     Quarterly and Annual Financial Results



                                     (in millions, except per-share data)
                              --------- --------- --------- ---------- ---------
                               4Q 2012   4Q 2011   3Q 2012       2012       2011
                              --------- --------- --------- ---------- ---------
Sales                           $627.5    $600.4    $645.2   $2,555.4   $2,404.1

Net income                       $13.5     $16.3      $3.6      $52.2      $75.2

Net income per diluted share
(2)                              $0.13     $0.15     $0.04      $0.52      $0.70

Net income excluding special
items (1)                        $13.8     $18.5     $22.8      $71.6      $79.9

Net income excluding special
items per diluted share (1)      $0.14     $0.17     $0.23      $0.71      $0.75

Weighted average diluted
common shares outstanding (2)    101.2     106.6     101.0      101.1      106.7

EBITDA (1)                       $78.3     $81.4     $59.2     $300.0     $332.6

EBITDA excluding special items
(1)                              $78.7     $85.0     $90.5     $331.8     $340.2


(1) For reconciliations of non-GAAP measures, see "Summary Notes to Consolidated
Financial Statements and Segment Information."
(2) As of December 31, 2012, we had 100.5 million common shares outstanding. For
additional information, see "Summary Notes to Consolidated Financial Statements
and Segment Information."

Packaging Segment

Packaging segment sales for fourth quarter 2012 were $287.3 million, an increase
of $35.9 million, or 14%, compared with $251.4 million in fourth quarter 2011.
About half of the increase was the result of our acquisition of Hexacomb on
December 1, 2011. The remaining increase resulted from sales volume growth in
our network of box plants, which increased 9% in fourth quarter 2012, compared
with the same quarter in 2011. Our vertical integration rose from an average of
71% during 2011 to 84% in 2012, and we expect it to increase to approximately
90% in 2013 based on our current volumes. Our increased vertical integration
decreased our sales to third parties by 46% in fourth quarter 2012, compared
with fourth quarter 2011. Net sales prices for our corrugated products,
excluding Hexacomb, increased 2% during fourth quarter 2012, compared with
fourth quarter 2011. Packaging segment sales for fourth quarter 2012 were
essentially flat, compared with third quarter 2012.

Packaging segment sales for full year 2012 were $1,130.1 million, an increase of
$180.4 million, or 19%, compared with $949.7 million for 2011. Sales volumes of
corrugated products increased 16% in 2012, compared with 2011.  Slightly more
than half of this increase related to growth from our 2011 acquisitions and the
remainder was due to increased sales from our network of box plants, which
offset the decline in linerboard net sales prices and volumes sold to third
parties during 2012 by 2% and 31%, respectively, compared with 2011.

Packaging segment EBITDA, excluding special items, was $47.1 million for fourth
quarter 2012, a slight increase from $46.9 million in fourth quarter 2011.
Although we benefited from two additional months of operations at Hexacomb in
the quarter, this was offset by higher input costs and margin compression on the
sale of some of our corrugated products at our converting operations. Packaging
segment EBITDA in fourth quarter 2012 increased $9.6 million, or 25%, compared
with third quarter 2012, due to improved sales prices of linerboard sold to
third parties and lower maintenance outage costs, offset partially by higher
fiber costs.

Packaging segment EBITDA, excluding special items, for full year 2012 was $162.5
million, an increase of $3.2 million, or 2%, compared with 2011. The increase
reflects a full year impact from our acquisitions. Our corrugated products sales
volumes increased 16% year over year; however, these increases were largely
offset by margin compression on the sale of some of our corrugated products.

During first quarter 2013, we will conduct a cold outage at our mill in
DeRidder, Louisiana. Cold outages at this facility occur every five years and
are more extensive and costly than our normal annual maintenance outages.  We
expect total maintenance outage costs for our Packaging segment in 2013 to be
approximately $23 million, an increase of approximately $12 million from 2012,
with $20 million expected in first quarter 2013, relative to $2 million in first
quarter 2012, with the remaining $3 million expected in third quarter 2013.

Paper Segment

Lower uncoated freesheet sales prices affected our fourth quarter 2012 sales,
compared with fourth quarter 2011 and third quarter 2012. Paper segment sales
for fourth quarter 2012 were $352.7 million, a decrease of $7.0 million, or 2%,
compared with fourth quarter 2011. Paper segment sales decreased $17.3 million,
or 5%, compared with third quarter 2012. Our average sales price of uncoated
freesheet declined from $993 per short ton in fourth quarter 2011 and $975 per
short ton in third quarter 2012 to $948 per short ton in fourth quarter 2012.
Total uncoated freesheet sales volumes increased 3% versus the prior-year period
but were down 4% versus third quarter 2012 as a result of seasonal demand
decline.

Paper segment sales for full year 2012 were $1,468.3 million, down 2% compared
with 2011, due to lower sales prices of uncoated freesheet and lower sales
prices and volumes of market pulp. Our average sales price of uncoated freesheet
was $968 per short ton in 2012, down from an average of $990 per short ton in
2011. Sales volumes of uncoated freesheet were up 2% in 2012, compared with
2011. The increase in our uncoated freesheet sales volumes for the year is due
to a 5% increase in sales of label and release and premium office papers and
higher purchase volumes by our cut-size customers. Combined sales volumes of
label and release and premium office papers represented 34% of our total
uncoated freesheet sales volumes for 2012, up from 33% in the prior year.

Paper segment EBITDA, excluding special items, was $38.7 million for fourth
quarter 2012, a decrease of $5.7 million, or 13%, compared with fourth quarter
2011. This decrease was due primarily to lower sales prices of uncoated
freesheet. This decline was largely offset by generally lower input and
maintenance outage costs. Paper segment EBITDA, excluding special items, for
fourth quarter 2012 decreased $19.9 million from third quarter 2012 as a result
of lower sales volumes and net selling prices for uncoated freesheet and higher
maintenance outage costs as a result of our annual outage at our Jackson,
Alabama, mill.

Paper segment EBITDA, excluding special items, for full year 2012 was $193.3
million, a decrease of $8.2 million, or 4%, compared with $201.5 million for the
year ended December 31, 2011. This decrease resulted from the $22 per short ton
reduction in the average sales price of uncoated freesheet and the $107 per
short ton reduction in the average sales price of market pulp. Additionally,
chemical costs increased $13.8 million year over year, due to higher prices and
increased volumes for key chemicals such as caustic soda and starch. These
changes were offset partially by an overall $34.0 million reduction in fiber
costs as higher wood chip prices, primarily in the Pacific Northwest, were
offset by lower purchased pulp prices and improved pulp production at
International Falls, Minnesota, and Jackson, Alabama, which reduced our
consumption of purchased pulp.

Webcast and Conference Call

Boise Inc. will host a webcast and conference call on Tuesday, February
26, 2013, at 11:00 a.m. ET, at which time we will review the company's recent
performance. To participate in the conference call, dial 866-841-1001
(international callers should dial 832-445-1689). This webcast will be archived
from February 26, 2013, at 2:00 p.m. ET through March 26, 2013, at 11:45 p.m.
ET. Playback numbers are 855-859-2056 for U.S. callers and 404-537-3406 for
international callers. The passcode is 87424464. To access the replay, go to
www.BoiseInc.com and click on About Boise Inc. to reach the link to the webcast
under Webcasts & Presentations on the Investors menu.

Annual Meeting Date

Boise Inc. intends to hold its annual shareholders' meeting at 9:00 a.m. MDT on
Wednesday, April 24, 2013, in Boise, Idaho. The record date to determine
shareholders eligible to vote at the meeting is Monday, March 18, 2013.

About Boise Inc.

Headquartered in Boise, Idaho, Boise Inc. (NYSE: BZ) manufactures a wide variety
of packaging and paper products. Boise's range of packaging products includes
linerboard and corrugating medium, corrugated containers and sheets, and
protective packaging products. Boise's paper products include imaging papers for
the office and home, printing and converting papers, and papers used in
packaging, such as label and release papers. Our employees are committed to
delivering excellent value while managing our businesses to sustain
environmental resources for future generations. Visit our website at
www.BoiseInc.com.

Forward-Looking Statements

This news release contains statements that are "forward looking," as defined by
the Private Securities Litigation Reform Act of 1995. Forward-looking statements
include, without limitation, any statement that may predict, forecast, indicate,
or imply future results, performance, or achievements. Statements regarding
announced price increases on our products, cost management efforts, asset
configuration changes, and vertical integration levels and the benefits we
expect to derive from such outcomes and actions are forward looking. Given the
risks and uncertainties involved, there can be no assurance we will be able to
achieve our stated goals or realize any benefits. For example, changes in the
economy and competitive influences may result in our being unable to implement
or realize any additional benefit from our announced price increases. Economic
and competitive influences, availability of equipment and suppliers, the
performance of the equipment once installed, and other factors could cause the
outcome of our asset configuration projects, the related costs, and the timing
to differ materially from what we have predicted in this release. For further
information about the risks and uncertainties associated with our business,
please refer to our filings with the Securities and Exchange Commission.  We
undertake no obligation to update the forward-looking statements in this release
whether as a result of new information, future events, or otherwise.

Boise Inc.
Segment Highlights
(dollars in millions)

                              --------- --------- --------- ---------- ---------
                               4Q 2012   4Q 2011   3Q 2012       2012       2011
                              --------- --------- --------- ---------- ---------
Packaging

Sales volumes (thousands of
short tons, except corrugated)

Linerboard, Total                156.8     157.9     155.7      611.1      606.5

Linerboard, External sales        31.2      57.5      36.5      158.9      230.2

Newsprint                         60.3      58.6      60.0      233.4      230.8

Corrugated containers and
sheets (mmsf) (a)                2,578     2,297     2,584     10,079      8,720

Key input costs

Fiber, including purchased
rollstock                        $43.4     $42.3     $39.8     $176.9     $156.9

Energy                            16.4      15.1      16.4       61.2       65.2

Chemicals                         10.9      10.0      10.6       42.0       38.0

Outage costs                     (0.3)         -       3.5       10.9        9.9

EBITDA (b)                        47.1      45.5      37.5      162.5      155.5

EBITDA excluding special items
(b)                               47.1      46.9      37.5      162.5      159.3

Assets                                                         $958.0     $957.3

Paper

Sales volumes (thousands of
short tons)

Uncoated freesheet (c)           302.4     294.1     313.8    1,253.8    1,229.8

Corrugating medium                34.9      33.9      33.7      135.3      135.3

Market pulp                       15.6      20.3      18.5       52.9       90.2

Key input costs

Fiber                            $77.9     $94.1     $85.7     $343.1     $377.1

Energy                            34.2      36.4      33.4      134.8      143.9

Chemicals                         49.6      51.1      55.6      211.6      197.8

Outage costs                       4.6       7.8       0.4       14.8       21.5

EBITDA (b)                        38.2      44.4      27.3      161.6      201.5

EBITDA excluding special items
(b)                               38.7      44.4      58.6      193.3      201.5

Assets                                                       $1,144.7   $1,190.9


                                           ------------- ------------- ---------
                                            4Q 2012 vs.   4Q 2012 vs.   2012 vs.

                                              4Q 2011       3Q 2012       2011
                                           ------------- ------------- ---------
Packaging

Change in net sales prices (dollars per
short ton, except corrugated) (d)

Linerboard, Total                                   $45           $40         $8

Linerboard, External sales only                      39            31        (7)

Newsprint                                           (1)             3        (1)

Corrugated containers and sheets ($/msf)
(a)                                                   6             1          8

Paper

Change in net sales prices (dollars per
short ton) (d)

Uncoated freesheet (c)                            $(45)         $(27)      $(22)

Corrugating medium                                   77            53         28

Market pulp                                        (12)           (6)      (107)


(a) Includes corrugated container and sheet volumes for Tharco and protective
packaging product volumes for Hexacomb since the acquisitions on March 1 and
December 1, 2011, respectively. Increase in sales price during 2012 is primarily
due to Hexacomb.
(b) For reconciliations of non-GAAP measures, see "Summary Notes to Consolidated
Financial Statements and Segment Information."
(c) Includes cut-size office papers, printing and converting papers, and label
and release papers.
(d) Average net selling prices for our principal products represent sales less
freight costs, discounts, and allowances.

Boise Inc.
Consolidated Statements of Income
(dollars and shares in thousands, except per-share data)

                           Three Months Ended                  Year Ended
                  ------------------------------------- ------------------------
                       December 31       September 30,         December 31
                  ---------------------                 ------------------------
                     2012     2011 (2)       2012           2012       2011 (2)
                  ---------- ---------- --------------- ------------ -----------
Sales

Trade              $611,925   $591,524        $631,054   $2,495,092   $2,364,024

Related parties      15,567      8,917          14,131       60,271       40,057
                  ---------- ---------- --------------- ------------ -----------
                    627,492    600,441         645,185    2,555,363    2,404,081
                  ---------- ---------- --------------- ------------ -----------


Costs and expenses

Materials, labor,
and other
operating expenses
(excluding
depreciation) (1)   491,554    462,315         502,848    2,004,044    1,880,271

Fiber costs from
related parties       5,094      5,154           5,266       19,772       18,763

Depreciation,
amortization, and
depletion            39,907     37,320          37,540      152,306      143,758

Selling and
distribution
expenses             30,602     28,999          30,015      121,827      107,654

General and
administrative
expenses             20,492     18,872          19,213       79,748       60,587

St. Helens charges
(1)                     111          -          27,448       27,559            -

Other (income)
expense, net (3)        982      1,860           1,509        2,572        1,994
                  ---------- ---------- --------------- ------------ -----------
                    588,742    554,520         623,839    2,407,828    2,213,027
                  ---------- ---------- --------------- ------------ -----------


Income from
operations           38,750     45,921          21,346      147,535      191,054
                  ---------- ---------- --------------- ------------ -----------


Foreign exchange
gain (loss)           (376)        430             296          179          135

Loss on
extinguishment of
debt (4)                  -    (2,300)               -            -      (2,300)

Interest expense   (15,484)   (15,653)        (15,458)     (61,740)     (63,817)

Interest income          59         59               3          160          269
                  ---------- ---------- --------------- ------------ -----------
                   (15,801)   (17,464)        (15,159)     (61,401)     (65,713)
                  ---------- ---------- --------------- ------------ -----------


Income before
income taxes         22,949     28,457           6,187       86,134      125,341

Income tax
provision           (9,402)   (12,202)         (2,584)     (33,984)     (50,131)
                  ---------- ---------- --------------- ------------ -----------
Net income          $13,547    $16,255          $3,603      $52,150      $75,210
                  ---------- ---------- --------------- ------------ -----------


Weighted average
common shares
outstanding:

Basic               100,167    103,991         100,144       99,872      101,941

Diluted             101,180    106,613         101,030      101,143      106,746



Net income per
common share:

Basic                 $0.14      $0.16           $0.04        $0.52        $0.74

Diluted               $0.13      $0.15           $0.04        $0.52        $0.70


For footnotes, see Summary Notes to Consolidated Financial Statements and
Segment Information.

Boise Inc.
Segment Information
(dollars in thousands)

                           Three Months Ended                  Year Ended
                  ------------------------------------- ------------------------
                       December 31       September 30,         December 31
                  ---------------------                 ------------------------
                     2012       2011         2012           2012         2011
                  ---------- ---------- --------------- ------------ -----------
Segment sales

Packaging (2)      $287,332   $251,388        $285,705   $1,130,102     $949,710

Paper               352,702    359,697         369,952    1,468,344    1,496,537

Intersegment
eliminations and
other              (12,542)   (10,644)        (10,472)     (43,083)     (42,166)
                  ---------- ---------- --------------- ------------ -----------
                   $627,492   $600,441        $645,185   $2,555,363   $2,404,081
                  ---------- ---------- --------------- ------------ -----------


Segment income
(loss)

Packaging (2) (3)   $31,630    $31,837         $22,715     $101,626     $104,996

Paper (1)            14,926     21,794           5,463       73,913      112,051

Corporate and
Other (3)           (8,182)    (7,280)         (6,536)     (27,825)     (25,858)
                  ---------- ---------- --------------- ------------ -----------
                     38,374     46,351          21,642      147,714      191,189
                  ---------- ---------- --------------- ------------ -----------


Loss on
extinguishment of
debt (4)                  -    (2,300)               -            -      (2,300)

Interest expense   (15,484)   (15,653)        (15,458)     (61,740)     (63,817)

Interest income          59         59               3          160          269
                  ---------- ---------- --------------- ------------ -----------
Income before
income taxes        $22,949    $28,457          $6,187      $86,134     $125,341
                  ---------- ---------- --------------- ------------ -----------


EBITDA (5)

Packaging (2) (3)   $47,089    $45,518         $37,538     $162,542     $155,543

Paper (1)            38,244     44,390          27,275      161,563      201,533

Corporate and
Other (3) (4)       (7,052)    (8,537)         (5,631)     (24,085)     (24,429)
                  ---------- ---------- --------------- ------------ -----------
                    $78,281    $81,371         $59,182     $300,020     $332,647
                  ---------- ---------- --------------- ------------ -----------


EBITDA excluding
special items (5)

Packaging (2) (3)   $47,089    $46,882         $37,538     $162,542     $159,334

Paper (1)            38,701     44,390          58,563      193,308      201,533

Corporate and
Other (3) (4)       (7,052)    (6,237)         (5,631)     (24,085)     (20,626)
                  ---------- ---------- --------------- ------------ -----------
                    $78,738    $85,035         $90,470     $331,765     $340,241
                  ---------- ---------- --------------- ------------ -----------


For footnotes, see Summary Notes to Consolidated Financial Statements and
Segment Information.

Boise Inc.
Consolidated Balance Sheets
(dollars in thousands)


                                           December 31, 2012   December 31, 2011
                                          ------------------- ------------------
ASSETS



Current

Cash and cash equivalents                            $49,707             $96,996

Receivables

Trade, less allowances of $1,382 and
$1,343                                               240,459             228,838

Other                                                  8,267               7,622

Inventories                                          294,484             307,305

Deferred income taxes                                 17,955              20,379

Prepaid and other                                      8,828               6,944
                                          ------------------- ------------------
                                                     619,700             668,084
                                          ------------------- ------------------


Property

Property and equipment, net                        1,223,001           1,235,269

Fiber farms                                           24,311              21,193
                                          ------------------- ------------------
                                                   1,247,312           1,256,462
                                          ------------------- ------------------


Deferred financing costs                              26,677              30,956

Goodwill                                             160,130             161,691

Intangible assets, net                               147,564             159,120

Other assets                                           7,029               9,757
                                          ------------------- ------------------
Total assets                                      $2,208,412          $2,286,070
                                          ------------------- ------------------

For footnotes, see Summary Notes to Consolidated Financial Statements and
Segment Information.

Boise Inc.
Consolidated Balance Sheets (continued)
(dollars and shares in thousands, except per-share data)

                                           December 31, 2012   December 31, 2011
                                          ------------------- ------------------
LIABILITIES AND STOCKHOLDERS' EQUITY



Current

Current portion of long-term debt                    $10,000             $10,000

Accounts payable                                     185,078             202,584

Accrued liabilities

Compensation and benefits                             70,950              64,907

Interest payable                                      10,516              10,528

Other                                                 20,528              22,540
                                          ------------------- ------------------
                                                     297,072             310,559
                                          ------------------- ------------------


Debt

Long-term debt, less current portion                 770,000             790,000
                                          ------------------- ------------------


Other

Deferred income taxes                                198,370             161,260

Compensation and benefits                            121,682             172,394

Other long-term liabilities                           73,102              57,010
                                          ------------------- ------------------
                                                     393,154             390,664
                                          ------------------- ------------------


Commitments and contingent liabilities



Stockholders' equity

Preferred stock, $0.0001 par value per
share: 1,000 shares authorized; none
issued                                                     -                   -

Common stock, $0.0001 par value per share:
250,000 shares authorized; 100,503 and
100,272 shares issued and outstanding                     12                  12

Treasury stock, 21,151 shares held                 (121,423)           (121,421)

Additional paid-in capital                           868,840             866,901

Accumulated other comprehensive income
(loss)                                             (101,304)           (121,962)

Retained earnings                                    102,061             171,317
                                          ------------------- ------------------
Total stockholders' equity                           748,186             794,847
                                          ------------------- ------------------

                                          ------------------- ------------------
Total liabilities and stockholders' equity        $2,208,412          $2,286,070
                                          ------------------- ------------------

For footnotes, see Summary Notes to Consolidated Financial Statements and
Segment Information.

Consolidated Statements of Cash Flows
(dollars in thousands)

                                                            Year Ended December
                                                                    31
                                                          ----------------------
                                                                2012        2011
                                                          ----------- ----------
Cash provided by (used for) operations

Net income                                                   $52,150     $75,210

Items in net income not using (providing) cash

Depreciation, depletion, and amortization of deferred
financing costs and other                                    157,040     149,715

Share-based compensation expense                               5,983       3,695

Pension expense                                               11,279      10,916

Deferred income taxes                                         33,684      44,301

St. Helens charges                                            28,481           -

Other                                                          1,868       1,878

Loss on extinguishment of debt (4)                                 -       2,300

Decrease (increase) in working capital, net of
acquisitions

Receivables                                                  (9,803)       1,624

Inventories                                                    8,136    (22,237)

Prepaid expenses                                               (814)       (275)

Accounts payable and accrued liabilities                    (16,505)       3,803

Current and deferred income taxes                            (1,938)       4,632

Pension payments                                            (35,205)    (25,414)

Other                                                            674          43
                                                          ----------- ----------
Cash provided by operations                                  235,030     250,191
                                                          ----------- ----------
Cash provided by (used for) investment

Acquisition of businesses and facilities, net of cash
acquired (2)                                                       -   (326,223)

Expenditures for property and equipment                    (137,642)   (128,762)

Purchases of short-term investments                                -     (3,494)

Maturities of short-term investments                               -      14,114

Other                                                          1,393       1,048
                                                          ----------- ----------
Cash used for investment                                   (136,249)   (443,317)
                                                          ----------- ----------
Cash provided by (used for) financing

Issuances of long-term debt                                    5,000     275,000

Payments of long-term debt                                  (25,000)   (256,831)

Payments of financing costs                                    (188)     (8,613)

Repurchases of common stock                                      (2)   (121,421)

Proceeds from exercise of warrants                                 -     284,785

Payment of special dividends                               (119,653)    (47,916)

Tax withholdings on net settlements of share-based awards    (5,833)     (2,775)

Other                                                          (394)       1,060
                                                          ----------- ----------
Cash provided by (used for) financing                      (146,070)     123,289
                                                          ----------- ----------
Decrease in cash and cash equivalents                       (47,289)    (69,837)

Balance at beginning of the period                            96,996     166,833
                                                          ----------- ----------
Balance at end of the period                                 $49,707     $96,996
                                                          ----------- ----------

For footnotes, see Summary Notes to Consolidated Financial Statements and
Segment Information.

Summary Notes to Consolidated Financial Statements and Segment Information

The Consolidated Statements of Income, Consolidated Balance Sheets, Consolidated
Statements of Cash Flows, and Segment Information do not include all Notes to
Consolidated Financial Statements and should be read in conjunction with the
Company's 2012 Annual Report on Form 10-K, as well as other reports the Company
files with the SEC. Net income for all periods presented involved estimates and
accruals.

1. In September 2012, we committed to a plan to cease paper production on our
one remaining paper machine at our St. Helens, Oregon, paper mill, which we shut
down in December 2012. During the three months ended September 30, 2012 and the
year ended December 31, 2012, we recorded $31.3 million and $31.7 million,
respectively, of pretax costs related primarily to ceasing operations at the
mill. These costs are recorded in our Paper segment. The $31.7 million of costs
for the year ended December 31, 2012, included approximately $14.2 million of
noncash charges related primarily to the impairment of property, plant and
equipment, and inventory; and approximately $17.5 million of cash costs of which
we expect to pay approximately $7.3 million of employee-related and other costs
in early 2013 and the remaining amounts over a longer term. During the three
months ended September 30, 2012 and the year ended December 31, 2012, we
recorded $27.4 million and $27.6 million, respectively, in "St. Helens charges"
and $3.9 million and $4.1 million, respectively, related primarily to inventory
in Materials, labor, and other operating expenses (excluding depreciation)" in
our Consolidated Statements of Income.

2. On March 1 and December 1, 2011, we completed the acquisitions of Tharco
Packaging (Tharco) and Hexacomb Corporation (Hexacomb), respectively. Total cash
consideration was $326.2 million. Financial results for Tharco and Hexacomb are
included in our Packaging segment following the dates of acquisition.

In connection with the Tharco purchase price allocation, inventories were
written up to their estimated fair market value. As the related inventories were
sold, we recognized $2.2 million of expense in "Materials, labor, and other
operating expenses (excluding depreciation)" in our Consolidated Statement of
Income for the year ended December 31, 2011.

3. During the three months ended December 31, 2011, we recorded $1.4 million of
transaction-related expenses in the Packaging segment, and during the year ended
December 31, 2011, we recorded $1.6 million and $1.5 million of expenses in our
Packaging and Corporate and Other segments, respectively. Transaction-related
expenses include expenses associated with transactions, whether consummated or
not, and do not include integration costs.

4. The year ended December 31, 2011, included $2.3 million of expense related to
losses on the extinguishment of debt.

5. This release contains several financial measures that are not measures under
U.S. generally accepted accounting principles (GAAP). These measures include
EBITDA, EBITDA excluding special items, net income excluding special items, free
cash flow, and other similar measures. Management uses these measures to
evaluate ongoing operations and believes they are useful to investors because
they enable them to perform meaningful comparisons of past and present operating
results. The tables that follow reconcile these non-GAAP measures with the most
directly comparable GAAP measures.

EBITDA represents income before interest (interest expense and interest income),
income taxes, and depreciation, amortization, and depletion. The following table
reconciles net income to EBITDA and EBITDA to EBITDA excluding special items
(unaudited, dollars in thousands):

                                Three Months Ended               Year Ended
                        ----------------------------------- --------------------
                            December 31      September 30,       December 31
                        -------------------                 --------------------
                          2012      2011         2012          2012       2011
                        --------- --------- --------------- ---------- ---------
Net income               $13,547   $16,255          $3,603    $52,150    $75,210

Interest expense          15,484    15,653          15,458     61,740     63,817

Interest income             (59)      (59)             (3)      (160)      (269)

Income tax provision       9,402    12,202           2,584     33,984     50,131

Depreciation,
amortization, and
depletion                 39,907    37,320          37,540    152,306    143,758
                        --------- --------- --------------- ---------- ---------
EBITDA                   $78,281   $81,371         $59,182   $300,020   $332,647
                        --------- --------- --------------- ---------- ---------


St. Helens charges          $457        $-         $31,288    $31,745         $-

Inventory purchase
accounting expense             -         -               -          -      2,200

Loss on extinguishment
of debt                        -     2,300               -          -      2,300

Transaction-related
costs                          -     1,364               -          -      3,094
                        --------- --------- --------------- ---------- ---------
EBITDA excluding special
items                    $78,738   $85,035         $90,470   $331,765   $340,241
                        --------- --------- --------------- ---------- ---------

The following table reconciles segment income (loss) and EBITDA to EBITDA
excluding special items (dollars in thousands):

                             Three Months Ended                 Year Ended
                    ------------------------------------- ----------------------
                         December 31       September 30,        December 31
                    ---------------------                 ----------------------
                       2012       2011         2012          2012        2011
                    ---------- ---------- --------------- ----------- ----------
Packaging

Segment income        $31,630    $31,837         $22,715    $101,626    $104,996

Depreciation,
amortization, and
depletion              15,459     13,681          14,823      60,916      50,547
                    ---------- ---------- --------------- ----------- ----------
EBITDA                 47,089     45,518          37,538     162,542     155,543
                    ---------- ---------- --------------- ----------- ----------
Inventory purchase
accounting expense          -          -               -           -       2,200

Transaction-related
costs (a)                   -      1,364               -           -       1,591
                    ---------- ---------- --------------- ----------- ----------
EBITDA excluding
special items         $47,089    $46,882         $37,538    $162,542    $159,334
                    ---------- ---------- --------------- ----------- ----------


Paper

Segment income        $14,926    $21,794          $5,463     $73,913    $112,051

Depreciation,
amortization, and
depletion              23,318     22,596          21,812      87,650      89,482
                    ---------- ---------- --------------- ----------- ----------
EBITDA                $38,244    $44,390         $27,275    $161,563    $201,533
                    ---------- ---------- --------------- ----------- ----------
St. Helens charges        457          -          31,288      31,745           -
                    ---------- ---------- --------------- ----------- ----------
EBITDA excluding
special items          38,701     44,390          58,563     193,308     201,533
                    ---------- ---------- --------------- ----------- ----------


Corporate and Other

Segment loss         $(8,182)   $(7,280)        $(6,536)   $(27,825)   $(25,858)

Depreciation,
amortization, and
depletion               1,130      1,043             905       3,740       3,729

Loss on
extinguishment of
debt                        -    (2,300)               -           -     (2,300)
                    ---------- ---------- --------------- ----------- ----------
EBITDA               $(7,052)   $(8,537)        $(5,631)   $(24,085)   $(24,429)
                    ---------- ---------- --------------- ----------- ----------
Loss on
extinguishment of
debt                        -      2,300               -           -       2,300

Transaction-related
costs (a)                   -          -               -           -       1,503
                    ---------- ---------- --------------- ----------- ----------
EBITDA excluding
special items         (7,052)    (6,237)         (5,631)    (24,085)    (20,626)
                    ---------- ---------- --------------- ----------- ----------

                    ---------- ---------- --------------- ----------- ----------
EBITDA                $78,281    $81,371         $59,182    $300,020    $332,647
                    ---------- ---------- --------------- ----------- ----------

                    ---------- ---------- --------------- ----------- ----------
EBITDA excluding
special items         $78,738    $85,035         $90,470    $331,765    $340,241
                    ---------- ---------- --------------- ----------- ----------

(a)Transaction-related costs include expenses associated with transactions,
whether consummated or not, and do not include integration costs.

The following table reconciles net income to net income excluding special items
and presents net income per diluted share excluding special items (unaudited,
dollars and shares in thousands, except per-share data):

                                 Three Months Ended               Year Ended
                         ----------------------------------- -------------------
                             December 31      September 30,      December 31
                         -------------------                 -------------------
                           2012      2011         2012          2012      2011
                         --------- --------- --------------- ---------- --------
Net income                $13,547   $16,255          $3,603    $52,150   $75,210

St. Helens charges            457         -          31,288     31,745         -

Inventory purchase
accounting expense              -         -               -          -     2,200

Loss on extinguishment of
debt                            -     2,300               -          -     2,300

Transaction-related costs       -     1,364               -          -     3,094

Tax provision for special
items (a)                   (177)   (1,418)        (12,108)   (12,285)   (2,939)
                         --------- --------- --------------- ---------- --------
Net income excluding
special items             $13,827   $18,501         $22,783    $71,610   $79,865
                         --------- --------- --------------- ---------- --------


Weighted average common
shares outstanding:
diluted                   101,180   106,613         101,030    101,143   106,746

Net income excluding
special items per diluted
share                       $0.14     $0.17           $0.23      $0.71     $0.75


(a) Taxes are applied to special items in the aggregate at the combined federal
and state statutory rate in effect for the period.

The following table reconciles cash provided by operations to free cash flow
(unaudited, dollars in thousands):

                             Three Months Ended                 Year Ended
                    ------------------------------------- ----------------------
                         December 31       September 30,        December 31
                    ---------------------                 ----------------------
                       2012       2011         2012          2012        2011
                    ---------- ---------- --------------- ----------- ----------
Cash provided by
operations            $69,756    $74,646         $92,147    $235,030    $250,191

Expenditures for
property and
equipment            (55,349)   (44,893)        (29,836)   (137,642)   (128,762)
                    ---------- ---------- --------------- ----------- ----------
Free cash flow        $14,407    $29,753         $62,311     $97,388    $121,429
                    ---------- ---------- --------------- ----------- ----------

SOURCE: Boise Inc.

Greg Jones
Director, Investor Relations
208-384-7141

Virginia Aulin
Vice President, Human Resources and Corporate Affairs
208-384-7837

http://www.boiseinc.com/




This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
    other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
     originality of the information contained therein.

Source: Boise Paper Holdings LLC via Thomson Reuters ONE
[HUG#1681012]



SHARE THIS: Twitter StockTwits LinkedIn Google Plus SHORT URL: http://bdvt.co/tMJ

SIGN IN TO BOARDVOTE

FORGOT PASSWORD?