BOISE, Idaho, July 20 /PRNewswire-FirstCall/ -- Boise Cascade Corporation
(NYSE: BCC) today reported second quarter 2004 net income of $50.4 million, or
52 cents per diluted share, compared with a net loss of $3.9 million, or
12 cents per diluted share, in second quarter 2003. In first quarter 2004,
Boise reported net income of $63.5 million, or 66 cents per diluted share.
The quarter's results include a pretax gain of approximately $46.5
million, or 31 cents per diluted share, on the sale of Boise's 47% interest in
Voyageur Panel in May 2004. Before this special item, the company posted
second quarter 2004 net income of $22.0 million, or 21 cents per diluted
share.
FINANCIAL HIGHLIGHTS
($ in millions, except per-share amounts)
2Q 2Q 1Q
2004 2003 2004
Sales $3,401 $1,929 $3,530
Net income (loss) $50.4 $(3.9) $63.5
Net income (loss) per diluted share $0.52 $(0.12) $0.66
BEFORE SPECIAL ITEMS
Net income (loss) $22.0 $(3.9) $26.9
Net income (loss) per diluted share $0.21 $(0.12) $0.26
Sales in second quarter 2004 increased 76% to $3.40 billion, compared with
$1.93 billion in the second quarter a year ago. Sales in first quarter 2004
were $3.53 billion. Year-over-year sales increased primarily because of the
acquisition of OfficeMax in December 2003 but were also aided by strong
product prices in Boise Building Solutions.
REVIEW OF OPERATIONS
Boise Office Solutions
($ in millions)
2Q 2Q 1Q
2004 2003 2004
Sales $2,005 $905 $2,341
Operating income $16.0 $23.9 $58.4
Operating margin 0.8% 2.6% 2.5%
On December 9, 2003, Boise acquired OfficeMax, Inc. Following that
acquisition, the company began reporting two operating segments, Contract and
Retail, within Boise Office Solutions, its office products distribution
business. Taken together, the two operating segments make up the company's
Boise Office Solutions business.
For second quarter 2004, Boise Office Solutions sales increased 122% to
$2.0 billion, compared with $905 million in the same quarter a year ago.
Sales for locations operating in both periods, including OfficeMax retail
store locations on a pro forma basis, increased 2%. Total pro forma sales of
office supplies and paper and technology products increased 1%, and sales of
furniture were up 4%. Boise's office papers sold through Boise Office
Solutions increased 23% to 177,000 tons, compared with a year ago.
Boise Office Solutions operating income was $16.0 million, down from
$23.9 million in second quarter 2003 and $58.4 million in first quarter 2004.
The operating margin was 0.8%, compared with 2.6% in second quarter 2003 and
2.5% in first quarter 2004. Results weakened from year-ago levels primarily
because of seasonal losses in the Retail segment. The sharp decline in
operating income from first to second quarter, although more severe in Retail
than in Contract, reflected normal seasonality in both segments.
In second quarter 2004, Boise Office Solutions achieved $31.7 million of
integration synergies and recorded integration costs of $8.3 million. In the
first half of 2004, synergies totaled $44.3 million of the $80 million
expected for the year. First half integration costs were $17.2 million.
Below is the review of operations for the Boise Office Solutions Contract
and Retail segments.
Boise Office Solutions, Contract Segment
($ in millions)
2Q 2Q 1Q
2004 2003 2004
Sales $1,038 $905 $1,120
Operating income $21.4 $23.9 $34.4
Operating margin 2.1% 2.6% 3.1%
Boise Office Solutions, Contract, sales of $1.0 billion in second quarter
2004 were 15% higher than sales in second quarter 2003 and 7% lower than first
quarter 2004. Year-over-year same-location sales on a pro forma basis rose
5% in the second quarter. Excluding the impact of foreign exchange,
same-location sales grew 3%.
This segment reported second quarter 2004 operating income of
$21.4 million, compared with $23.9 million in the second quarter 2003 and
$34.4 million in first quarter 2004. The operating margin was 2.1%, compared
with 2.6% in second quarter 2003 and 3.1% in first quarter 2004. The Contract
segment includes the former OfficeMax direct business, with its extensive
warehouse infrastructure, which recorded losses in the first and second
quarters.
Boise Office Solutions, Retail Segment
($ in millions)
2Q 1Q
2004 2004
Sales $967 $1,221
Operating income (loss) $(5.4) $24.0
Operating margin (0.6)% 2.0%
Boise began reporting its Boise Office Solutions, Retail, segment on
December 10, 2003. In second quarter 2004, segment sales of $967 million were
3% lower than OfficeMax retail sales on a pro forma basis in second quarter
2003. Second quarter sales no longer include sales from the 45 retail stores
closed in the first quarter 2004. Same-location pro forma sales were flat.
Retail segment sales declined 21% from first quarter 2004 sales, reflecting
normal seasonality.
The Retail segment reported an operating loss of $5.4 million in second
quarter 2004, compared with income of $24.0 million in first quarter 2004 and
an operating margin of (0.6)%, compared with 2.0% in first quarter 2004.
Boise Building Solutions
($ in millions)
2Q 2Q 1Q
2004 2003 2004
Sales $1,055 $693 $852
Operating income $126.7 $9.8 $68.4
BEFORE SPECIAL ITEM
Operating income $80.2 $9.8 $68.4
Fueled by strong plywood and lumber markets, Boise Building Solutions
reported operating income of $80.2 million in second quarter 2004, before a
pretax gain of $46.5 million on the previously announced sale of Boise's 47%
interest in Voyageur Panel. By comparison, the segment earned $9.8 million in
the same quarter a year ago and $68.4 million in first quarter 2004.
Relative to second quarter 2003, average plywood prices increased 60%, and
average lumber prices rose 42%. Year over year, unit sales volumes for
plywood and lumber declined because of the sale of our Yakima, Washington,
wood products facilities in February 2004. Building materials distribution
sales increased 57%, compared with second quarter 2003. Sales of engineered
wood products grew 37%.
Relative to first quarter 2004, average plywood and lumber prices
increased 12% and 9%, respectively. However, cooling markets in May and June
led to sharp product price declines from early-quarter peaks to quarter-end.
Unit sales volumes in plywood and lumber declined 5% and 3%, respectively.
Delivered-log costs in the first half of 2004 increased 6%, compared with
first half 2003 costs.
Boise Paper Solutions
($ in millions)
2Q 2Q 1Q
2004 2003 2004
Sales $494 $459 $475
Operating income (loss) $(1.0) $1.0 $27.8
BEFORE NONROUTINE ITEMS
Operating loss $(1.0) $1.0 $(32.1)
Boise Paper Solutions reported an operating loss of $1.0 million in second
quarter 2004, compared with income of $1.0 million in second quarter 2003 and
a loss of $32.1 million, before a special item, in first quarter 2004.
Results were similar to those of a year ago as the positive impact of 11%
higher sales volumes was offset by slightly weaker average prices. The sharp
improvement over first quarter 2004 results, before the special item, was due
to 4% higher sales volumes, 4% higher average prices, and 5% lower unit
manufacturing costs.
OUTLOOK
"We expect two of Boise's three businesses to show improved results in the
third quarter," said George J. Harad, chairman and chief executive officer.
"Sales and income in our office products business typically strengthen
significantly from second-quarter levels and should again this year.
"In our paper business, gradually strengthening uncoated free sheet,
containerboard, and newsprint markets should lead to improved results in the
third quarter.
"In Boise Building Solutions, the segment operating income is likely to
decline in the third quarter, reflecting the weakening in product prices at
the end of the second quarter."
About Boise Cascade Corporation
Boise, headquartered in Boise, Idaho, provides solutions to help customers
work more efficiently, build more effectively, and create new ways to meet
business challenges. We own or control more than 2 million acres of
timberland, primarily in the United States, to support our manufacturing
operations. Boise's first half 2004 sales were $6.9 billion.
Boise Office Solutions, headquartered in Itasca, Illinois, is a division
of Boise and a premier multinational contract and, under the OfficeMax(R)
brand, retail distributor of office supplies and paper, technology products,
and office furniture. Boise Office Solutions posted first half 2004 sales of
$4.3 billion.
Boise Building Solutions, headquartered in Boise, Idaho, is a division of
Boise and manufactures plywood, lumber, particleboard, and engineered wood
products. The business also operates 27 facilities that distribute a broad
line of building materials, including wood products manufactured by Boise.
Boise Building Solutions posted first half 2004 sales of $1.9 billion.
Boise Paper Solutions, headquartered in Boise, Idaho, is a division of
Boise and a manufacturer of office papers, a majority of which are sold
through Boise Office Solutions. Boise Paper Solutions also manufactures
printing, forms, and converting papers; value-added papers; newsprint;
containerboard and corrugated containers; and market pulp. The division had
first half 2004 sales of $1.0 billion. Visit the Boise website at http://www.bc.com.
WEBCAST AND CONFERENCE CALL
Boise will host an audiovisual webcast and conference call on Tuesday,
July 20, 2004, at noon Eastern Daylight Time, at which we will review the
company's recent performance and discuss the outlook for our businesses. You
can join the webcast through the Boise website. Go to http://www.bc.com, and
click on Investor Relations to find the link to the webcast. Please go to the
website at least 15 minutes before the start of the webcast to register and to
download and install any necessary audio software. To join the conference
call, dial (800) 374-0165 (International callers should dial (706) 634-0995)
at least 10 minutes before the start of the call. The archived webcast will
be available on the Presentations page of the Investor Relations section of
Boise's website.
FORWARD-LOOKING STATEMENTS
The Outlook section of this release includes projections of our financial
performance in the third quarter of 2004. These are forward-looking
statements, and they are subject to a number of risks and uncertainties that
could cause our actual results to differ materially from those we have
projected. Our projections for Boise Office Solutions, and for the company as
a whole, depend greatly on our ability to successfully integrate OfficeMax and
Boise Office Solutions. The integration process involves many complex
operational and personnel-related challenges. Any costs, difficulties, or
delays in the integration may negatively impact the financial performance of
Boise Office Solutions. In addition, our financial performance in Boise
Office Solutions is affected by the growth strategies and merchandising
activities of our key competitors. The relationship between the supply and
demand of paper and wood products heavily influences our financial performance
in Boise Building Solutions and Boise Paper Solutions. Weak demand, excess
supply, changes in manufacturing capacity, or changes in our cost structures
could cause our financial performance in these segments to differ materially
from what we have projected. All of our businesses operate in highly
competitive markets. Changes in the economy, both domestically and abroad,
and changes in interest rates, employment rates, and even weather can change
the competitive dynamics and financial performance of all of our businesses.
In July 2003, we announced that we would evaluate strategic alternatives for
our paper and forest products businesses. The timing, outcome, and
implementation of that evaluation may significantly affect the company, its
financial results, and its business prospects. For further information about
the risks that could cause our actual results to differ from those we project
here, please refer to our 2003 Annual Report on Form 10-K.
BOISE CASCADE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
(thousands, except per-share amounts)
Three Months Ended
June 30 March 31,
2004 2003 2004
Sales $3,401,189 $1,928,984 $3,529,654
Costs and expenses
Materials, labor, and
other operating expenses 2,673,447 1,578,445 2,762,453
Depreciation, amortization,
and cost of company
timber harvested 100,693 73,730 98,349
Selling and distribution
expenses 478,015 217,472 506,432
General and administrative
expenses 73,739 35,297 72,889
Other (income) expense, net (43,946) 1,836 (46,661)
3,281,948 1,906,780 3,393,462
Equity in net income
of affiliates 1,244 474 5,067
Income from operations 120,485 22,678 141,259
Interest expense (40,432) (31,063) (40,652)
Interest income 450 318 484
Foreign exchange gain (loss) (524) 1,860 180
(40,506) (28,885) (39,988)
Income (loss) before income
taxes and minority interest 79,979 (6,207) 101,271
Income tax (provision) benefit (29,192) 2,273 (36,964)
Income (loss) before
minority interest 50,787 (3,934) 64,307
Minority interest,
net of income tax (406) -- (842)
Net income (loss) 50,381 (3,934) 63,465
Preferred dividends (3,168) (3,287) (3,366)
Net income (loss) applicable
to common shareholders $47,213 $(7,221) $60,099
Net income (loss) per common share
Basic $0.54 $(0.12) $0.70
Diluted $0.52 $(0.12) $0.66
SEGMENT INFORMATION
Three Months Ended
June 30 March 31,
2004 2003 2004
(unaudited, thousands)
Segment sales
Boise Office Solutions,
Contract $1,038,112 $904,929 $1,120,107
Boise Office Solutions,
Retail 966,668 -- 1,220,992
2,004,780 904,929 2,341,099
Boise Building Solutions 1,055,267 692,843 851,539
Boise Paper Solutions 494,226 459,376 475,472
Intersegment eliminations
and other (153,084) (128,164) (138,456)
$3,401,189 $1,928,984 $3,529,654
Segment income (loss)
Boise Office Solutions,
Contract $21,410 $23,883 $34,382
Boise Office Solutions,
Retail (5,365) -- 24,032
16,045 23,883 58,414
Boise Building Solutions 126,659 9,820 68,422
Boise Paper Solutions (958) 1,023 27,800
Corporate and Other (21,335) (9,870) (12,713)
120,411 24,856 141,923
Interest expense (40,432) (31,063) (40,652)
Income (loss) before income
taxes and minority interest $79,979 $(6,207) $101,271
Before special items
Segment income (loss)
Boise Office Solutions,
Contract $21,410 $23,883 $34,382
Boise Office Solutions,
Retail (5,365) -- 24,032
16,045 23,883 58,414
Boise Building Solutions 80,161 9,820 68,422
Boise Paper Solutions (958) 1,023 (32,115)
Corporate and Other (21,335) (9,870) (12,713)
73,913 24,856 82,008
Interest expense (40,432) (31,063) (40,652)
Income (loss) before income taxes
and minority interest $33,481 $(6,207) $41,356
BOISE CASCADE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited)
(thousands, except per-share amounts)
Six Months Ended June 30
2004 2003
Sales $6,930,843 $3,782,227
Costs and expenses
Materials, labor, and
other operating expenses 5,435,900 3,093,634
Depreciation, amortization, and
cost of company timber harvested 199,042 149,312
Selling and distribution expenses 984,447 431,634
General and administrative expenses 146,628 70,670
Other (income) expense, net (90,607) 12,988
6,675,410 3,758,238
Equity in net income of affiliates 6,311 415
Income from operations 261,744 24,404
Interest expense (81,084) (63,254)
Interest income 934 432
Foreign exchange gain (loss) (344) 2,816
(80,494) (60,006)
Income (loss) before income taxes,
minority interest, and cumulative effect
of accounting changes 181,250 (35,602)
Income tax (provision) benefit (66,156) 12,925
Income (loss) before minority interest and
cumulative effect of accounting changes 115,094 (22,677)
Minority interest, net of income tax (1,248) --
Income (loss) before cumulative effect
of accounting changes 113,846 (22,677)
Cumulative effect of accounting changes,
net of income tax -- (8,803)
Net income (loss) 113,846 (31,480)
Preferred dividends (6,534) (6,553)
Net income (loss) applicable to
common shareholders $107,312 $(38,033)
Net income (loss) per common share
Basic before cumulative effect of
accounting changes $1.24 $(0.50)
Cumulative effect of accounting changes,
net of income tax -- (0.15)
Basic $1.24 $(0.65)
Diluted before cumulative effect of
accounting changes $1.18 $(0.50)
Cumulative effect of accounting changes,
net of income tax -- (0.15)
Diluted $1.18 $(0.65)
SEGMENT INFORMATION
Six Months Ended June 30
2004 2003
(unaudited, thousands)
Segment sales
Boise Office Solutions, Contract $2,158,219 $1,843,208
Boise Office Solutions, Retail 2,187,660 --
4,345,879 1,843,208
Boise Building Solutions 1,906,806 1,267,487
Boise Paper Solutions 969,698 927,589
Intersegment eliminations and other (291,540) (256,057)
$6,930,843 $3,782,227
Segment income (loss)
Boise Office Solutions, Contract $55,792 $44,555
Boise Office Solutions, Retail 18,667 --
74,459 44,555
Boise Building Solutions 195,081 1,367
Boise Paper Solutions 26,842 338
Corporate and Other (34,048) (18,608)
262,334 27,652
Interest expense (81,084) (63,254)
Income (loss) before income taxes,
minority interest, and cumulative
effect of accounting changes $181,250 $(35,602)
Before special items
Segment income (loss)
Boise Office Solutions, Contract $55,792 $53,778
Boise Office Solutions, Retail 18,667 --
74,459 53,778
Boise Building Solutions 148,583 1,367
Boise Paper Solutions (33,073) 539
Corporate and Other (34,048) (17,918)
155,921 37,766
Interest expense (81,084) (63,254)
Income (loss) before income taxes,
minority interest, and cumulative
effect of accounting changes $74,837 $(25,488)
(1) Financial Information
The Consolidated Statements of Income (Loss) and Segment Information
are unaudited statements, which do not include all Notes to Consolidated
Financial Statements, and should be read in conjunction with the
company's 2003 Annual Report on Form 10-K. In all periods presented,
net income (loss) involved estimates and accruals.
Certain amounts in prior years' financial statements have been
reclassified to conform with the current year's presentation. These
reclassifications did not affect net income (loss).
(2) Reconciliation of Net Income (Loss) and Diluted Income (Loss) Per
Share Before Special Items and the Cumulative Effect of Accounting Changes
We evaluate our results of operations both before and after special
gains and losses. We believe our presentation of financial measures
before special items enhances our investors' overall understanding of
our recurring operational performance. Specifically, we believe the
results before special items provide useful information to both
investors and management by excluding gains and losses that are not
indicative of our core operating results.
In the following tables, we reconcile our financial measures before
special items to our reported financial results for the three months
ended June 30, 2004, and March 31, 2004, and the six months ended
June 30, 2004 and 2003 (see Notes 4-6 and 8).
Three Months Ended
June 30, 2004 March 31, 2004
Before Before
As Special Special As Special Special
Reported Items (a) Items Reported Items (b) Items
(millions, except per-share amounts)
Boise Office
Solutions,
Contract $21.4 $-- $21.4 $34.4 $-- $34.4
Boise Office
Solutions,
Retail (5.4) -- (5.4) 24.0 -- 24.0
16.0 -- 16.0 58.4 -- 58.4
Boise Building
Solutions 126.7 (46.5) 80.2 68.4 -- 68.4
Boise Paper
Solutions (1.0) -- (1.0) 27.8 (59.9) (32.1)
Corporate and
Other (21.3) -- (21.3) (12.7) -- (12.7)
120.4 (46.5) 73.9 141.9 (59.9) 82.0
Interest
expense (40.4) -- (40.4) (40.6) -- (40.6)
Income before
income taxes
and minority
interest 80.0 (46.5) 33.5 101.3 (59.9) 41.4
Income tax
provision (29.2) 18.1 (11.1) (37.0) 23.3 (13.7)
Income before
minority
interest 50.8 (28.4) 22.4 64.3 (36.6) 27.7
Minority interest,
net of income
tax (0.4) -- (0.4) (0.8) -- (0.8)
Net income $50.4 $(28.4) $22.0 $63.5 $(36.6) $26.9
Net income per
common
share (c)
Diluted $0.52 $(0.31) $0.21 $0.66 $(0.40) $0.26
(a) See Note 5 for a discussion of this special item.
(b) See Note 4 for a discussion of this special item.
(c) Calculated using 91.7 million and 91.3 million average diluted shares
outstanding for the three months ended June 30, 2004, and
March 31, 2004 (see Note 9).
Six Months Ended
June 30, 2004 June 30, 2003
Before Before
As Special Special As Special Special
Reported Items (a) Items Reported Items (b) Items
(millions, except per-share amounts)
Boise Office
Solutions,
Contract $55.8 $-- $55.8 $44.6 $9.2 $53.8
Boise Office
Solutions,
Retail 18.7 -- 18.7 -- -- --
74.5 -- 74.5 44.6 9.2 53.8
Boise Building
Solutions 195.1 (46.5) 148.6 1.4 -- 1.4
Boise Paper
Solutions 26.8 (59.9) (33.1) 0.3 0.2 0.5
Corporate
and Other (34.0) -- (34.0) (18.6) 0.7 (17.9)
262.4 (106.4) 156.0 27.7 10.1 37.8
Interest expense (81.1) -- (81.1) (63.3) -- (63.3)
Income (loss)
before income
taxes, minority
interest, and
cumulative effect
of accounting
changes 181.3 (106.4) 74.9 (35.6) 10.1 (25.5)
Income tax
benefit (66.2) 41.4 (24.8) 12.9 (4.0) 8.9
Income (loss)
before minority
interest and
cumulative
effect of
accounting
changes 115.1 (65.0) 50.1 (22.7) 6.1 (16.6)
Minority interest,
net of
income tax (1.3) -- (1.3) -- -- --
Income (loss)
before cumulative
effect of
accounting
changes 113.8 (65.0) 48.8 (22.7) 6.1 (16.6)
Cumulative effect
of accounting
changes, net of
income tax -- -- -- (8.8) 8.8 --
Net income
(loss) $113.8 $(65.0) $48.8 $(31.5) $14.9 $(16.6)
Net income (loss)
per common share (c)
Diluted before
cumulative effect
of accounting
changes $1.18 $(0.71) $0.47 $(0.50) $0.11 $(0.39)
Cumulative effect
of accounting
changes, net of
income tax -- -- -- (0.15) 0.15 --
Diluted $1.18 $(0.71) $0.47 $(0.65) $0.26 $(0.39)
(a) See Notes 4 and 5 for a discussion of these special items.
(b) See Notes 6 and 8 for a discussion of these special items.
(c)Calculated using 91.5 million and 58.3 million average diluted shares
outstanding for the six months ended June 30, 2004, and June 30, 2003
(see Note 9).
(3) Acquisition of OfficeMax
On December 9, 2003, we acquired OfficeMax, Inc. OfficeMax is a
subsidiary of Boise Cascade Corporation, and the results of OfficeMax
operations after December 9, 2003, are included in our Boise Office
Solutions, Contract and Retail segments. For more information about the
acquisition, see Note 2, OfficeMax Acquisition, in "Item8. Financial
Statements and Supplementary Data" in our 2003 Annual Report on
Form 10-K.
(4) First Quarter 2004
On March 31, 2004, we sold approximately 79,000 acres of timberland
located in western Louisiana for $84 million. We recorded a
$59.9 million gain in "Other income (expense)" in our Boise Paper
Solutions segment. This item increased net income $36.6 million after
taxes for the three months ended March 31, 2004, and the six months
ended June 30, 2004.
(5) Second Quarter 2004
In May 2004, we sold our 47% interest in Voyageur Panel to Ainsworth
Lumber Co. Ltd. for $96.5 million of cash. We recorded a $46.5 million
gain in "Other income (expense)" in our Boise Building Solutions
segment. This item increased net income $28.4 million after taxes for
the three and six months ended June 30, 2004.
Prior to the sale, we accounted for the joint venture under the equity
method. Accordingly, segment results do not include the joint venture's
sales but do include $5.1 million, $1.2 million, and $0.4 million of
equity in earnings during the three months ended March 31 and
June 30, 2004, and June 30, 2003, respectively. The six months ended
June 30, 2004 and 2003, include $6.3 million and $0.4 million of equity
in earnings.
(6) First Quarter 2003
In first quarter 2003, we announced the termination of approximately
550 employees and recorded a pretax charge of $10.1 million for
employee-related costs in "Other (income) expense, net" in our
Consolidated Statement of Loss. We recorded these costs in accordance
with the provisions of Statement of Financial Accounting Standards
(SFAS) No. 112, Employers' Accounting for Postemployment Benefits.
We recorded $9.2 million in the Boise Office Solutions, Contract,
segment; $0.2 million in the Boise Paper Solutions segment; and
$0.7 million in our Corporate and Other segment. Employee-related costs
are primarily for severance payments, most of which were paid in 2003
with the remainder to be paid in 2004. This item increased our net loss
$6.1 million for the six months ended June 30, 2003.
(7) Income Taxes
Our estimated effective tax provision rate for the six months ended
June 30, 2004, was 36.5%, compared with an effective tax benefit rate
of 36.3% for the six months ended June 30, 2003. Changes in estimated
tax rates are due to the sensitivity of the rates to changing income
levels and the mix of domestic and foreign sources of income.
(8) Cumulative Effect of Accounting Changes
Effective January 1, 2003, we adopted the provisions of SFAS No. 143,
Accounting for Asset Retirement Obligations, which affects the way we
account for landfill closure costs. This statement requires us to
record an asset and a liability (discounted) for the estimated closure
and closed-site monitoring costs and to depreciate the asset over the
landfill's expected useful life. Previously, we accrued for the closure
costs over the life of the landfill and expensed monitoring costs as
incurred. Effective January 1, 2003, we recorded a one-time after-tax
charge of $4.1 million, or 7 cents per share, as a cumulative-effect
adjustment for the difference between the amounts recognized in our
consolidated financial statements prior to the adoption of this
statement and the amount recognized after adopting the provisions of
SFAS No. 143.
Effective January 1, 2003, we adopted an accounting change for vendor
allowances to comply with the guidelines issued by the Financial
Accounting Standards Board's Emerging Issues Task Force EITF 02-16,
Accounting by a Customer (Including a Reseller) for Certain
Consideration Received From a Vendor. Under the new guidance, vendor
allowances reside in inventory with the product and are recognized when
the product is sold, changing the timing of our recognition of these
items. This change resulted in a one-time, noncash, cumulative-effect
adjustment of $4.7 million, or 8 cents per share.
(9) Net Income (Loss) Per Common Share
Net income (loss) per common share was determined by dividing net
income (loss), as adjusted, by weighted average shares outstanding. For
the three and six months ended June 30, 2003, the computation of diluted
loss per share was antidilutive; therefore, amounts reported for basic
and diluted loss were the same.
Three Months Ended
June 30 March 31,
2004 2003 2004
(Unaudited)
(thousands, except per-share amounts)
BASIC
Income (loss) before cumulative
effect of accounting changes $50,381 $(3,934) $63,465
Preferred dividends (3,168) (3,287) (3,366)
Basic income (loss) $47,213 $(7,221) $60,099
Average shares used to determine
basic income (loss)
per common share 86,474 58,300 86,075
Basic income (loss)
per common share $0.54 $(0.12) $0.70
DILUTED
Basic income (loss) $47,213 $(7,221) $60,099
Preferred dividends eliminated 3,168 -- 3,366
Supplemental ESOP contribution (2,869) -- (3,063)
Diluted income (loss) $47,512 $(7,221) $60,402
Average shares used to determine
basic income (loss)
per common share 86,474 58,300 86,075
Restricted stock, stock options,
and other 1,976 -- 1,883
Series D Convertible
Preferred Stock 3,252 -- 3,309
Average shares used to determine
diluted income (loss)
per common share 91,702 58,300 91,267
Diluted income (loss)
per common share $0.52 $(0.12) $0.66
Six Months Ended June 30
2004 2003
(Unaudited)
(thousands, except per-share amounts)
BASIC
Income (loss) before cumulative effect
of accounting changes $113,846 $(22,677)
Preferred dividends (a) (6,534) (6,553)
Basic income (loss) before
cumulative effect of accounting changes 107,312 (29,230)
Cumulative effect of accounting changes,
net of income tax -- (8,803)
Basic income (loss) $107,312 $(38,033)
Average shares used to determine basic
income (loss) per common share 86,275 58,295
Basic income (loss) per common share
before cumulative effect of
accounting changes $1.24 $(0.50)
Cumulative effect of accounting changes,
net of income tax -- (0.15)
Basic income (loss) per common share $1.24 $(0.65)
DILUTED
Basic income (loss) before cumulative
effect of accounting changes $107,312 $(29,230)
Preferred dividends eliminated 6,534 --
Supplemental ESOP contribution (5,932) --
Diluted income (loss) before
cumulative effect of accounting changes 107,914 (29,230)
Cumulative effect of accounting changes,
net of income tax -- (8,803)
Diluted income (loss) $107,914 $(38,033)
Average shares used to determine basic
income (loss) per common share 86,275 58,295
Restricted stock, stock options, and other 1,929 --
Series D Convertible Preferred Stock 3,281 --
Average shares used to determine diluted
income (loss) per common share 91,485 58,295
Diluted income (loss) per common share
before cumulative effect of
accounting changes $1.18 $(0.50)
Cumulative effect of accounting changes,
net of income tax -- (0.15)
Diluted income (loss) per common share $1.18 $(0.65)
(a) Dividend attributable to our Series D Convertible Preferred Stock
held by our ESOP (employee stock ownership plan) is net of a tax
benefit.
SOURCE Boise Cascade Corporation
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Related links:
http://www.bc.com
CONTACT:
media, Ralph Poore, +1-208-384-7294, or home,
+1-208-331-2023, or investors, Vincent Hannity, office,
+1-208-384-6390, or cell, +1-208-890-6385, both of Boise Cascade
Corporation
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