Boise Cascade Office Products
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Dear Shareholders, Customers, and Associates:
Let's face it, the business world today is faster-paced and more demanding than it used to be. We understand the challenges our customers face in the office every day. We make work life a little easier by supplying the products and services they need, through leading-edge technology, for the lowest total cost.
We're growing. Revenues in 1997 were $2.6 billion, double the 1995 figure and up 31% from 1996. Earnings increased 18% before interest and taxes. We've expanded our product line beyond traditional office supplies and our geographic reach beyond the United States. We operate in Australia, Canada, the United Kingdom, and western Europe. By aligning ourselves with the best partners and bringing together the best people from all over the world, we are providing superior service to our customers.
We're investing. In 1997, we invested heavily in infrastructure and information technology. We made our Internet ordering system widely available, integrated direct marketing and contract stationer distribution centers, and continued to centralize functions. To pay for these and our acquisition program, we took on additional debt, incurring higher interest expense. This, together with a decline in gross margins caused by heightened competitive pressures, kept earnings per share flat-which, in turn, contributed to a stock price performance that disappointed all of us. We strongly believe our investments will pay off in 1998 and beyond, and will keep our company growing and solidly profitable.
We're focused. Despite many changes and much turbulence in our industry, our fundamental strategy hasn't changed. We're focusing all of our expansion efforts on providing the best products and services for the business customer. We're strong operators committed to consistent, dependable service. Our past and future alliances and acquisitions will be seamlessly integrated with current operations to give customers more tools they need to run their offices. We believe this strong customer focus is why our peers worldwide voted us "Office Products Company of the Year" for 1997.
We're trying to make your day at the office the best it can be. Thank you for your support in 1997.
Sincerely,
George J. Harad
Chairman of the BoardPeter G. Danis Jr.
Chief Executive Officer
Peter G. Danis Jr. has announced his intention to retire as Chief Executive Officer of Boise Cascade Office Products Corporation (BCOP) effective April 21, 1998. He will continue to serve on the Company's Board of Directors. Pete joined Boise Cascade Corporation, the majority holder of BCOP stock, in 1968. He was named President and Chief Executive Officer of BCOP in April 1995, when it became a publicly held company. Under Pete's outstanding leadership, the Company's annual revenues have doubled to $2.6 billion in the last three years. In addition, BCOP has entered into direct marketing, expanded its product lines beyond traditional office supplies, grown rapidly in the United States, and established a presence in Australia, Canada, and western Europe. The Board of Directors is most appreciative of his efforts and will continue to rely on his guidance as a member of the Board.
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