filings.toolsInternational Paper (IP) 10-K risk factor changes: FY2019 vs FY2018
The 2019-12-31 10-K against the 2018-12-31 one, compared heading by heading and sentence by sentence. One of these filings carries no fiscal year tag, so its year is the calendar year of the period end.
All filing items1,961 rewritten1,077 added669 removed1,557 unchanged
Summary
counted, not written
- Item 1A headings could not be compared: the parser did not find an Item 1A in both filings.
- Sentence by sentence, 1,077 added, 669 removed, 1,961 rewritten and 1,557 unchanged across 2 items that differ.
Sentences by item
2 items, with every count and a link to each item that changed
| Item | Added | Removed | Rewritten | Unchanged |
|---|---|---|---|---|
| Cover and table of contents | 110 | 67 | 268 | 235 |
| Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES | 967 | 602 | 1,693 | 1,322 |
Underlined words on a shaded ground are new in FY2019; struck-through words were in FY2018. Sentences that are wholly new or wholly gone are labelled rather than marked.
Cover and table of contents
268 rewritten, 110 added, 67 removed, 235 unchanged
[removed: UNITED STATES][added: UNITED STATES]
[removed: SECURITIES] [added: SECURITIES] AND EXCHANGE [removed: COMMISSION][added: COMMISSION]
[removed: WASHINGTON,] [added: WASHINGTON,] D.C. [removed: 20549][added: 20549]
[removed: FORM 10-K][added: FORM 10-K]
[removed: (Mark One)][added: Mark S.]
| [removed: ý] [added: ☒] | | [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934 for the fiscal year ended December 31, 2018] [added: 1934] |
| [removed: ¨] [added: ☐] | | [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934 For the transition period from to] [added: 1934] |
[removed: INTERNATIONAL] [added: INTERNATIONAL] PAPER [removed: COMPANY][added: COMPANY]
| [removed: New York] [added: New York] | | [removed: 13-0872805] [added: 13-0872805] |
[removed: 6400] [added: | 6400] Poplar [removed: Avenue][added: Avenue | | | |]
[removed: Memphis, Tennessee][added: | Memphis, | | Tennessee | |]
[added: |] (Address of principal executive offices) [added: | | | |]
[removed: 38197][added: | 38197 | | | |]
[added: |] (Zip Code) [added: | | | |]
[removed: Registrant’s] [added: | Registrant's] telephone number, including area [removed: code: (901) 419-9000][added: code: | | 901 | 419-9000 |]
| [removed: Title] [added: Title] of each [removed: class] [added: class] | [added: Trading symbol(s)] | [removed: Name] [added: Name] of each exchange on which [removed: registered] [added: registered] |
| Common [removed: Stock, $1 per share par value] [added: Shares] | [added: IP] | New York Stock Exchange |
Yes [removed: ¨] [added: ☐] No ý
| Large accelerated filer [removed: ý] | | Accelerated filer [removed: ¨] | | Non-accelerated filer [removed: ¨] | | Smaller reporting company [removed: ¨] | | Emerging growth company [removed: ¨] |
The aggregate market value of the Company’s outstanding common stock held by non-affiliates of the registrant, computed by reference to the closing price as reported on the New York Stock Exchange, as of the last business day of the registrant’s most recently completed second fiscal quarter (June 30, [removed: 2018)] [added: 2019)] was approximately [removed: $21,249,006,136.][added: $17,018,195,033.]
The number of shares outstanding of the Company’s common stock as of February [removed: 15, 2019] [added: 14, 2020] was [removed: 400,236,119.][added: 392,124,684.]
Portions of the registrant’s proxy statement filed within 120 days of the close of the registrant’s fiscal year in connection with registrant’s [removed: 2019] [added: 2020] annual meeting of shareholders are incorporated by reference into Part III of this Form 10-K.
[removed: INDEX] [added: INDEX] TO ANNUAL REPORT ON FORM [removed: 10-K][added: 10-K]
[removed: FOR] [added: FOR] THE YEAR [removed: ENDED DECEMBER] [added: ENDED DECEMBER] 31, [removed: 2018][added: 2019]
| [removed: ITEM 1.] [added: ITEM 1.] | [removed: [BUSINESS.](#sBDD83C6D92A65EA28CCDA18E32570417)] [added: [BUSINESS.](#s363FDD7AB1034CF3D2F3D3B6ED5A87B3)] | [removed: [1](#sBDD83C6D92A65EA28CCDA18E32570417)] [added: [1](#s363FDD7AB1034CF3D2F3D3B6ED5A87B3)] |
| | [Competition and [removed: Costs](#s1DB4AD09290B566E87D71B07C5DC02B7)] [added: Costs](#s590744A4209E5645C6A1D3B6EDAEE3D3)] | [removed: [1](#s1DB4AD09290B566E87D71B07C5DC02B7)] [added: [1](#s590744A4209E5645C6A1D3B6EDAEE3D3)] |
| | [Marketing and [removed: Distribution](#s23309035195C580D854CB037291B5C70)] [added: Distribution](#s8DBF66C096364C29D793D3B6EDD03781)] | [removed: [1](#s23309035195C580D854CB037291B5C70)] [added: [1](#s8DBF66C096364C29D793D3B6EDD03781)] |
| | [Description of Principal [removed: Products](#s9A526804EF2A5D8EA7D7F1C27CD1E901)] [added: Products](#s2AAE74BDFE975FEC0BFFD3B6EE02E724)] | [removed: [1](#s9A526804EF2A5D8EA7D7F1C27CD1E901)] [added: [1](#s2AAE74BDFE975FEC0BFFD3B6EE02E724)] |
[removed: | | [Sales Volumes by Product](#s9F86A766FBD858D7BC6915B35A6CF14C) | [2](#s9F86A766FBD858D7BC6915B35A6CF14C) |][added: SALES VOLUMES BY PRODUCT (a)]
| | [Research and [removed: Development](#s5D0C353B84DC5E779EF3B754842349F4)] [added: Development](#sFF3435C99116A4B1AB44D3B6EE5D4D5C)] | [removed: [2](#s5D0C353B84DC5E779EF3B754842349F4)] [added: [2](#sFF3435C99116A4B1AB44D3B6EE5D4D5C)] |
| | [Environmental [removed: Protection](#s17952E9A5DC75D12B51D5F7BAFE0F9A8)] [added: Protection](#sEE8C88D0E33136284F9AD3B6EE76887E)] | [removed: [3](#s17952E9A5DC75D12B51D5F7BAFE0F9A8)] [added: [2](#sEE8C88D0E33136284F9AD3B6EE76887E)] |
| | [Climate [removed: Change](#s915D79FCC30E5430A2308A0432683B52)] [added: Change](#s44537F11BFF9D9EB8C45D3B6EEAA28F4)] | [removed: [3](#s915D79FCC30E5430A2308A0432683B52)] [added: [3](#s44537F11BFF9D9EB8C45D3B6EEAA28F4)] |
| | [Raw [removed: Materials](#s9C555B7D731A53D7B671A27370020D3C)] [added: Materials](#s270778A1C4EED85FED06D3B6EF1DA7A4)] | [removed: [5](#s9C555B7D731A53D7B671A27370020D3C)] [added: [6](#s270778A1C4EED85FED06D3B6EF1DA7A4)] |
| | [Forward-looking [removed: Statements](#s9982E81FEC80599AA8D635AB16A702B6)] [added: Statements](#s94710ECDA4D3EA94986BD3B6EF4E185E)] | [removed: [5](#s9982E81FEC80599AA8D635AB16A702B6)] [added: [6](#s94710ECDA4D3EA94986BD3B6EF4E185E)] |
| [removed: ITEM 1A.] [added: ITEM 1A.] | [removed: [RISK FACTORS.](#sB9F4A1BBF6A15AAAA69289E9A3FC519E)] [added: [RISK FACTORS.](#s526A68FF6CE583033544D3B6EF70002E)] | [removed: [6](#sB9F4A1BBF6A15AAAA69289E9A3FC519E)] [added: [6](#s526A68FF6CE583033544D3B6EF70002E)] |
| [removed: ITEM 1B.] [added: ITEM 1B.] | [removed: [UNRESOLVED] [added: [UNRESOLVED] STAFF [removed: COMMENTS.](#s02D8D7AE3B29537C875FC03B9CC91AE4)] [added: COMMENTS.](#sEA0E5B5CF3B7292DD7E0D3B6EFA278D8)] | [removed: [10](#s02D8D7AE3B29537C875FC03B9CC91AE4)] [added: [12](#sEA0E5B5CF3B7292DD7E0D3B6EFA278D8)] |
| [removed: ITEM 2.] [added: ITEM 2.] | [removed: [PROPERTIES.](#s6DECC16FFEC4564AA36FBF8BFFC753E7)] [added: [PROPERTIES.](#sA6466EAC429084B0C6B0D3B6EFC3FEBA)] | [removed: [10](#s6DECC16FFEC4564AA36FBF8BFFC753E7)] [added: [12](#sA6466EAC429084B0C6B0D3B6EFC3FEBA)] |
| | [Mills and [removed: Plants](#sA6BE83C9F957523BB6A5DB8925F00045)] [added: Plants](#s604A206100293EC246DFD3B6F01610B7)] | [removed: [11](#sA6BE83C9F957523BB6A5DB8925F00045)] [added: [12](#s604A206100293EC246DFD3B6F01610B7)] |
| | [Capital Investments and [removed: Dispositions](#sF5477B88DC1751F5B86A673825CF7D33)] [added: Dispositions](#s3E4D37836CF72664D596D3B6F06E3B8D)] | [removed: [11](#sF5477B88DC1751F5B86A673825CF7D33)] [added: [12](#s3E4D37836CF72664D596D3B6F06E3B8D)] |
| [removed: ITEM 3.] [added: ITEM 3.] | [removed: [LEGAL PROCEEDINGS.](#s0EDC233F6E5255F3B9F2F5B87BEE9BE8)] [added: [LEGAL PROCEEDINGS.](#s1C1C3ECEB40E46ABC560D3B6F0716499)] | [removed: [11](#s0EDC233F6E5255F3B9F2F5B87BEE9BE8)] [added: [12](#s1C1C3ECEB40E46ABC560D3B6F0716499)] |
| | | For the fiscal year ended |
| | | 12/31/2019 |
| | | or |
| | | For the transition period from to |
| | | | |
| --- | --- | --- | --- |
| | | | |
| ☒ | | ☐ | | ☐ | | ☐ | | ☐ |
INTERNATIONAL PAPER COMPANY
| PART I. | | [1](#s6304B6016B375920A94AD3B6ED299969) |
| | [General](#s7198D5A3821E3D83FD16D3B6ED7BA872) | [1](#s7198D5A3821E3D83FD16D3B6ED7BA872) |
| | [Employees](#sCAC269C48E0E35C3185AD3B6EED1896F) | [4](#sCAC269C48E0E35C3185AD3B6EED1896F) |
| | [Information About Our Executive Officers](#s09A4089E140F437DFC77D3B6EEFCB4BB) | [4](#s09A4089E140F437DFC77D3B6EEFCB4BB) |
| | [Forestlands](#sEB0F42E5877F077C6E22D3B6EFF61C0C) | [12](#sEB0F42E5877F077C6E22D3B6EFF61C0C) |
INTERNATIONAL PAPER COMPANY
INDEX TO ANNUAL REPORT ON FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 2019
| ITEM 16. | FORM 10-K SUMMARY | |
| | [SIGNATURES](#s2158526B207E6C5163BFD3B701B71919) | [94](#s2158526B207E6C5163BFD3B701B71919) |
[PART I.](#s6304B6016B375920A94AD3B6ED299969)
BUSINESS](#s363FDD7AB1034CF3D2F3D3B6ED5A87B3)
[GENERAL](#s7198D5A3821E3D83FD16D3B6ED7BA872)
Management’s Discussion and Analysis of Financial Condition and Results of Operations](#sC3928206B04DD63FC283D3B6F1A5CAD4).
Management’s Discussion and Analysis of Financial Condition and Results of Operations](#sC3928206B04DD63FC283D3B6F1A5CAD4).
Management’s Discussion and Analysis of Financial Condition and Results of Operations](#sC3928206B04DD63FC283D3B6F1A5CAD4).
Management’s Discussion and Analysis of Financial Condition and Results of Operations](#sC3928206B04DD63FC283D3B6F1A5CAD4).
Management’s Discussion and Analysis of Financial Condition and Results of Operations](#sC3928206B04DD63FC283D3B6F1A5CAD4).
Our development efforts specifically
In addition, new environmental laws or regulations impacting our facilities around the world are routinely passed or proposed.
Our continuing objectives include:
The Company has been named as a potentially responsible party (PRP) in environmental remediation actions under various federal and state laws, including the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).
Many of these proceedings involve the cleanup of hazardous substances at large commercial landfills that received waste from many different sources.
While joint and several liability is authorized under CERCLA and equivalent state laws, as a practical matter, liability for CERCLA cleanups is typically allocated among the many PRPs.
There are other remediation costs typically associated with the cleanup of hazardous substances at the Company’s current, closed or formerly-owned facilities, and recorded as liabilities on the balance sheet.
For additional information regarding certain remediation actions, see [Note 14 Commitments and Contingent Liabilities](#s131177A0439BF6328E2CD3B6C192B9AF) of [Item 8.
Financial Statements and Supplementary Data](#s5884756FEF9E91FC72D2D3B6F3DE9170) on pages 65 through 68.
Our efforts to advance sustainable forest management and restore
California, New York and Virginia have already enacted such programs, although these regulations have not, and are not expected to have a material impact on the Company.
[EMPLOYEES](#sCAC269C48E0E35C3185AD3B6EED1896F)
Of our U.S. employees,
10-K 1 a10-k123118.htm 10-K
_____________________________________________________
| | | |
| --- | --- | --- |
or
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (section 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
(Check one):
| | | | | | | | | |
| PART I. | | [1](#s94CC072AFE6654D08153F4D26F64D83C) |
| | [General](#sEFD92E0764E150248A49671212F77E00) | [1](#sEFD92E0764E150248A49671212F77E00) |
| | [Employees](#sE150243BE5E15AA8B6C5FCD9AA0AB5A3) | [4](#sE150243BE5E15AA8B6C5FCD9AA0AB5A3) |
| | [Executive Officers of the Registrant](#s9E0B77AEF081540AADE51FE964424A17) | [4](#s9E0B77AEF081540AADE51FE964424A17) |
| | [Forestlands](#s8CAFB85C7C4B5F0682082F3C84E9FD58) | [10](#s8CAFB85C7C4B5F0682082F3C84E9FD58) |
| | [SIGNATURES](#s6A40500C8EBC50A5B907CF6939018A0F) | [89](#s6A40500C8EBC50A5B907CF6939018A0F) |
[PART I.](#s94CC072AFE6654D08153F4D26F64D83C)
BUSINESS](#sBDD83C6D92A65EA28CCDA18E32570417)
[GENERAL](#sEFD92E0764E150248A49671212F77E00)
| Asian Box (b) (d) | — | | — | | 208 | |
| (d) | Includes sales volumes through the date of sale on June 30, 2016. |
manufacturing operations; innovations and improvement of products; and development of various new products.
Since 2016, lawsuits challenging all or portions of the Boiler MACT regulations have resulted in the U.S. Court of Appeals for the D.C. Circuit remanding certain portions of the Boiler MACT regulations to the EPA for reconsideration of certain standards in the regulations.
Amendments lowering National Ambient Air Quality Standards (NAAQS) for sulfur dioxide (SO2), nitrogen dioxide (NO2), fine particulate (PM2.5), and ozone have been finalized by the EPA in recent years but to date have not had a material impact on the Company.
Consistent with this objective, participating countries aim to balance GHG
California has already enacted such a program and similar actions are being
considered by Washington.
The Company does not have any sites currently subject to California's GHG regulatory plan.
There may be indirect impacts from changing input costs (such as electricity) at some of our California converting operations but these have yet to manifest themselves in material impacts.
should not be considered part of this or any other report that we file with or furnish to the SEC.
[EMPLOYEES](#sE150243BE5E15AA8B6C5FCD9AA0AB5A3)
[EXECUTIVE OFFICERS OF THE REGISTRANT](#s9E0B77AEF081540AADE51FE964424A17)
Mark S.
W.
until November 2011, vice president from March 2011 until May 2011, associate general counsel, chief ethics and compliance officer from 2009 until 2011, and associate general counsel from 2006 until 2009.
“continue,” “anticipate,” “believe,” “expect,” “plan,” “appear,” “project,” “estimate,” “intend,” and words of a similar nature.
actual results to differ materially from those projected in any forward-looking statement.
CHANGES IN THE COST OR AVAILABILITY OF RAW MATERIALS, ENERGY AND TRANSPORTATION COULD AFFECT OUR PROFITABILITY.
FLUCTUATIONS IN THE PRICES OF, AND THE DEMAND FOR, OUR PRODUCTS COULD MATERIALLY AFFECT OUR FINANCIAL CONDITION, RESULTS OF OPERATIONS AND CASH FLOWS.
We operate in a competitive environment, both in the United States and internationally, in all of our operating segments.
CHANGES IN INTERNATIONAL CONDITIONS COULD ADVERSELY AFFECT OUR BUSINESS AND RESULTS OF OPERATIONS.
As of December 31, 2018, International Paper had approximately $10.7 billion of outstanding indebtedness.
An excerpt. Shown here: 40 of 268 rewritten, 40 of 110 added and 40 of 67 removed. The counts are complete. For every sentence, read Cover and table of contents in the FY2019 filing and the FY2018 filing.
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
1,693 rewritten, 967 added, 602 removed, 1,322 unchanged
As of February [removed: 15, 2019,] [added: 14, 2020,] there were approximately [removed: 11,316] [added: 9,663] record holders of common stock of the Company.
[removed: PURCHASES] [added: PURCHASES] OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED [removed: PURCHASERS.][added: PURCHASERS.]
| [removed: (a)] [added: *(a)*] | [removed: 13,385] [added: *5,562] shares were acquired from employees from share withholdings to pay income taxes under the Company’s restricted stock programs. During [removed: these periods, 4,412,530] [added: 2019, 10,828,416] shares were purchased under our share repurchase program, which was approved by our Board of Directors and announced on July 8, 2014 and October 9, 2018. Through this program, which does not have an expiration date, we were authorized to purchase, in open market transactions (including block trades), privately negotiated transactions or otherwise, up to $3.5 billion aggregate amount of shares of our common stock. As of February [removed: 15, 2019,] [added: 14, 2020,] approximately [removed: $2.19] [added: $1.75] billion aggregate amount of shares of our common stock remained authorized for purchase under this [removed: program.] [added: program.*] |
[removed: PERFORMANCE GRAPH][added: PERFORMANCE GRAPH]
[removed: The] [added: *The] performance graph shall not be deemed [removed: to be] “soliciting material” or to be “filed” with the Commission or subject to Regulation 14A or [removed: 14C,] [added: 14C under,] or to the liabilities of Section 18 [removed: of] [added: of,] the Exchange Act of 1934, as [removed: amended.][added: amended.*]
The following graph compares a $100 investment in Company stock on December 31, [removed: 2013] [added: 2014] with a $100 investment in our Return on Invested Capital (ROIC) Peer Group and the S&P 500 also made at market close on December 31, [removed: 2013.][added: 2014.]
The graph portrays total return, [removed: 2013–2018,] [added: 2014–2019,] assuming reinvestment of dividends.
[removed: ][added: ]
[removed: Note] [added: *Note] 1.
The companies included in the ROIC Peer Group are Domtar Inc., Fibria Celulose S.A., Graphic Packaging Holding Company, Klabin S.A., Metsa Board Corporation, Mondi Group, Packaging Corporation of America, Smurfit Kappa Group, Stora Enso Group, and UPM-Kymmene Corp. [removed: MeadWestvaco Corp. and Rock-Tenn Company are included in the ROIC Peer Group results through 2014 and subsequently, after the merger of those companies,] WestRock was added to the Peer group beginning in [removed: 2015.][added: 2016 after the merger of MeadWestvaco and Rock-Tenn.]
| [removed: Note 2.] [added: *Note 2.*] | [removed: Returns] [added: *Returns] are calculated in [removed: $USD.] [added: $USD.*] |
[removed: [ITEM] [added: [ITEM] 6.
SELECTED FINANCIAL [removed: DATA](#s8BBB226B29515C79A0D5B048B7E7E3E6)][added: DATA](#s43582ABA2B33ED0F6D02D3B6D6C2EA32)]
[removed: FIVE-YEAR] [added: FIVE-YEAR] FINANCIAL SUMMARY [removed: (a)][added: (a)]
| [removed: Dollar] [added: *Dollar] amounts in millions, except per share amounts and stock [removed: prices] [added: prices*] | [removed: 2018] [added: 2019] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | |
| [removed: RESULTS] [added: RESULTS] OF [removed: OPERATIONS] [added: OPERATIONS] | | | | | | | | | | | | | | | | | | | | |
| Net sales | [removed: $] [added: $] | [removed: 23,306] [added: 22,376] | | | $ | [removed: 21,743] [added: 23,306] | | | $ | [removed: 19,495] [added: 21,743] | | | $ | [removed: 20,675] [added: 19,495] | | | $ | [removed: 21,889] [added: 20,675] | | |
| Costs and expenses, excluding interest | [removed: 20,989] [added: 20,281] | | | | [removed: 20,323] [added: 20,989] | | | | [removed: 18,180] [added: 20,323] | | | | [removed: 18,988] [added: 18,180] | | | | [removed: 20,548] [added: 18,988] | | | |
| Earnings (loss) from continuing operations before income taxes and equity earnings | [removed: 1,781] [added: 1,604] | | | [removed: (b)] [added: (b)] | [removed: 848] [added: 1,781] | | | (e) | [removed: 795] [added: 848] | | | (h) | [removed: 1,132] [added: 795] | | | (k) | [removed: 734] [added: 1,132] | | | (n) |
| Equity earnings (loss), net of taxes | [removed: 336] [added: 250] | | | | [removed: 177] [added: 336] | | | | [removed: 198] [added: 177] | | | | [removed: 117] [added: 198] | | | | [removed: (200] [added: 117] | | [removed: )] | |
| Discontinued operations, net of taxes | [removed: 345] [added: —] | | | [removed: (c)] | [removed: 34] [added: 345] | | | (f) | [removed: 102] [added: 34] | | | (i) | [removed: 85] [added: 102] | | | (l) | [removed: 77] [added: 85] | | | (o) |
| Net earnings (loss) | [removed: 2,017] [added: 1,220] | | | [removed: (b-d)] [added: (b-c)] | [removed: 2,144] [added: 2,017] | | | (e-g) | [removed: 902] [added: 2,144] | | | (h-j) | [removed: 917] [added: 902] | | | (k-m) | [removed: 536] [added: 917] | | | (n-p) |
| Noncontrolling interests, net of taxes | [removed: 5] [added: (5] | | [added: )] | [added: (d)] | [removed: —] [added: 5] | | | | [removed: (2] [added: —] | | [removed: )] | | [removed: (21] [added: (2] | | ) | | [removed: (19] [added: (21] | | ) | |
| Net earnings (loss) attributable to International Paper Company | [removed: 2,012] [added: 1,225] | | | [removed: (b-d)] [added: (b-d)] | [removed: 2,144] [added: 2,012] | | | (e-g) | [removed: 904] [added: 2,144] | | | (h-j) | [removed: 938] [added: 904] | | | (k-m) | [removed: 555] [added: 938] | | | (n-p) |
| [removed: FINANCIAL POSITION] [added: FINANCIAL POSITION] | | | | | | | | | | | | | | | | | | | | |
| Current assets less current liabilities | [removed: $] [added: $] | [removed: 2,302] [added: (2,007] | [added: )] | | $ | [removed: 3,175] [added: 2,302] | | | $ | [removed: 2,601] [added: 3,175] | | | $ | [removed: 2,244] [added: 2,601] | | | $ | [removed: 2,719] [added: 2,244] | | |
| Plants, properties and equipment, net | [removed: 13,067] [added: 13,004] | | | | [removed: 13,265] [added: 13,067] | | | | [removed: 13,003] [added: 13,265] | | | | [removed: 11,000] [added: 13,003] | | | | [removed: 11,794] [added: 11,000] | | | |
| Forestlands | [removed: 402] [added: 391] | | | | [removed: 448] [added: 402] | | | | [removed: 456] [added: 448] | | | | [removed: 366] [added: 456] | | | | [removed: 507] [added: 366] | | | |
| Total assets | [removed: 33,576] [added: 33,471] | | | | [removed: 33,903] [added: 33,576] | | | | [removed: 33,093] [added: 33,903] | | | | [removed: 30,271] [added: 33,093] | | | | [removed: 28,369] [added: 30,271] | | | |
| Notes payable and current maturities of long-term debt | [removed: 639] [added: 168] | | | | [removed: 311] [added: 639] | | | | [removed: 239] [added: 311] | | | | [removed: 426] [added: 239] | | | | [removed: 742] [added: 426] | | | |
| Long-term debt | [removed: 10,015] [added: 9,597] | | | | [removed: 10,846] [added: 10,015] | | | | [removed: 11,075] [added: 10,846] | | | | [removed: 8,844] [added: 11,075] | | | | [removed: 8,584] [added: 8,844] | | | |
| Total shareholders’ equity | [removed: 7,362] [added: 7,713] | | | | [removed: 6,522] [added: 7,362] | | | | [removed: 4,341] [added: 6,522] | | | | [removed: 3,884] [added: 4,341] | | | | [removed: 5,115] [added: 3,884] | | | |
| [removed: BASIC] [added: BASIC] EARNINGS PER SHARE ATTRIBUTABLE TO INTERNATIONAL PAPER COMPANY COMMON [removed: SHAREHOLDERS] [added: SHAREHOLDERS] | | | | | | | | | | | | | | | | | | | | |
| Earnings (loss) from continuing operations | [removed: $] [added: $] | [removed: 4.07] [added: 3.10] | | | $ | [removed: 5.11] [added: 4.07] | | | $ | [removed: 1.95] [added: 5.11] | | | $ | [removed: 2.05] [added: 1.95] | | | $ | [removed: 1.12] [added: 2.05] | | |
| Discontinued operations | [removed: 0.84] [added: —] | | | | [removed: 0.08] [added: 0.84] | | | | [removed: 0.25] [added: 0.08] | | | | [removed: 0.20] [added: 0.25] | | | | [removed: 0.18] [added: 0.20] | | | |
| Net earnings (loss) | [removed: 4.91] [added: 3.10] | | | | [removed: 5.19] [added: 4.91] | | | | [removed: 2.20] [added: 5.19] | | | | [removed: 2.25] [added: 2.20] | | | | [removed: 1.30] [added: 2.25] | | | |
| [removed: DILUTED] [added: DILUTED] EARNINGS PER SHARE ATTRIBUTABLE TO INTERNATIONAL PAPER COMPANY COMMON [removed: SHAREHOLDERS] [added: SHAREHOLDERS] | | | | | | | | | | | | | | | | | | | | |
| Earnings (loss) from continuing operations | [removed: $] [added: $] | [removed: 4.02] [added: 3.07] | | | $ | [removed: 5.05] [added: 4.02] | | | $ | [removed: 1.93] [added: 5.05] | | | $ | [removed: 2.03] [added: 1.93] | | | $ | [removed: 1.10] [added: 2.03] | | |
| Discontinued operations | [removed: 0.83] [added: —] | | | | [removed: 0.08] [added: 0.83] | | | | [removed: 0.25] [added: 0.08] | | | | [removed: 0.20] [added: 0.25] | | | | [removed: 0.19] [added: 0.20] | | | |
| Net earnings (loss) | [removed: 4.85] [added: 3.07] | | | | [removed: 5.13] [added: 4.85] | | | | [removed: 2.18] [added: 5.13] | | | | [removed: 2.23] [added: 2.18] | | | | [removed: 1.29] [added: 2.23] | | | |
We pay regular quarterly cash dividends and expect to continue to pay regular quarterly cash dividends in the foreseeable future, though each quarterly dividend payment is subject to review and approval by our Board of Directors.
Our ability to pay dividends is, and in the
future may continue to be, limited by the terms of our debt documents.
| October 1, 2019 - October 31, 2019 | — | | $ | — | | — | | $ | 1.75 | |
| November 1, 2019 - November 30, 2019 | 205 | | 43.68 | | | — | | 1.75 | | |
| December 1, 2019 - December 31, 2019 | 5,357 | | 46.34 | | | — | | 1.75 | | |
Fibria Celulose S.A. was excluded at the end of 2018 due to being acquired by Suzano.*
| Financial assets of variable interest entities | 7,088 | | | | 7,070 | | | | 7,051 | | | | 7,033 | | | | 7,014 | | | |
| Current nonrecourse financial liabilities of variable interest entities | 4,220 | | | | — | | | | — | | | | — | | | | — | | | |
| Long-term nonrecourse financial liabilities of variable interest entities | 2,085 | | | | 6,298 | | | | 6,291 | | | | 6,284 | | | | 6,277 | | | |
| India impairment | | $ | 159 | | | $ | 157 | |
| India divestiture transaction costs | | 3 | | | | 2 | | |
| Global Cellulose Fibers goodwill impairment | | 52 | | | | 42 | | |
| Litigation reserves | | 41 | | | | 31 | | |
| Italian antitrust fine | | 32 | | | | 32 | | |
| (Gain) loss on sale of EMEA Packaging box plant | | (6 | | ) | | (5 | | ) |
| Foreign VAT refund accrual including interest | | (6 | | ) | | (4 | | ) |
| Gain on sale of previously closed Oregon mill site | | (9 | | ) | | (7 | | ) |
| Overhead cost reduction initiative | | 21 | | | | 16 | | |
| Luxembourg statutory tax rate change | | $ | 9 | |
| Foreign deferred tax valuation allowance | | 203 | | |
| *(d)* | *Includes the following allocation of loss:* |
| In millions | | Before Tax | | | | After Tax | | |
| India Impairment | | $ | 9 | | | $ | 9 | |
| *In millions* | | Before Tax | | | | After Tax | | |
| In millions | | Before Tax | | | | After Tax | | |
| *In millions* | | Before Tax | | | | After Tax | | |
| In millions | | Before Tax | | | | After Tax | | |
| *In millions* | | Before Tax | | | | After Tax | | |
| In millions | | Before Tax | | | | After Tax | | |
| *In millions* | | Before Tax | | | | After Tax | | |
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included in “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K.
In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs that involve significant risks and uncertainties.
Our actual results could differ materially from those discussed in the forward-looking statements.
Factors that could cause or contribute to those differences include those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in “Risk Factors” and “Forward-Looking Statements.”
The following generally discusses 2019 and 2018 items and year-to-year comparisons between 2019 and 2018.
Discussion of historical items in 2017, and year-to-year comparisons between 2018 and 2017, can be found in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the SEC on February 20, 2019, under Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations.
International Paper delivered solid earnings and outstanding cash generation in 2019.
Our performance demonstrates our ability to generate strong cash flow and the flexibility of the company to navigate well through a challenging global environment.
While the U.S. economy remains healthy, during 2019 we managed through significant inventory headwinds and broader trade tensions that impacted our exports.
| October 1, 2018 - October 31, 2018 | 2,225,310 | | $ | 44.94 | | 2,225,188 | | $ | 2.33 | |
| November 1, 2018 - November 30, 2018 | 1,475,242 | | 45.79 | | | 1,474,900 | | 2.27 | | |
| December 1, 2018 - December 31, 2018 | 725,363 | | 45.51 | | | 712,442 | | 2.23 | | |
| Total | 4,425,915 | | | | | | | | | |
2014:
| | | 2014 | | | | | | |
| Temple-Inland integration | | $ | 16 | | | $ | 10 | |
| Courtland mill shutdown | | 554 | | | | 338 | | |
| India legal contingency resolution | | (20 | | ) | | (20 | | ) |
| Asia Industrial Packaging goodwill impairment | | 100 | | | | 100 | | |
| Loss on sale by investee and impairment of investment | | 47 | | | | 36 | | |
| Total | | $ | 1,264 | | | $ | 809 | |
(o) Includes the operating earnings of the North American Consumer Packaging business and the xpedx business prior to the spin-off, and the following charges (gains):
| xpedx spinoff | | $ | 24 | | | $ | 16 | |
| Building Products divestiture | | 16 | | | | 9 | | |
| xpedx restructuring | | 1 | | | | (1 | | ) |
Full-year 2017 net earnings included a provisional net tax benefit of $1.2 billion ($2.93 per diluted share) related to the U.S. enactment of the Tax Cuts and Jobs Act of 2017 reported as a special item.
International Paper delivered strong earnings, returns and cash generation in 2018, driven by solid commercial and operational performance across our three businesses.
Business segment operating profit improved by approximately $800 million to $2.9 billion in 2018, driven primarily by price and mix improvements, with revenue growth of 7.2%.
The Company made strategic investments to strengthen our businesses.
Among these, we completed the final phase of our multi-year North American containerboard mill system optimization projects, which gives us the added flexibility we need around capacity, products and geographies.
In our EMEA Packaging business, we completed the conversion of the Madrid, Spain mill and started production of high-performance, lightweight recycled containerboard to capture the integrated margin with our EMEA box system.
International Paper continued to deliver strong cash generation in 2018, which we used to strengthen our balance sheet and return cash to shareholders.
The Company’s 2018 results include significant price and mix improvements driven by price realization across our three business segments.
Improved mix contributed to the Company’s strong performance, particularly in our Global Cellulose Fibers business where we continued to grow fluff pulp volume.
Weather events in North America and startup costs associated with the Madrid, Spain mill negatively impacted operations, and planned maintenance outages were higher.
by $159 million to $336 million in 2018, driven by excellent commercial and operational performance in our Ilim joint venture and first-year equity earnings from Graphic Packaging International Partners, LLC (GPIP).
In total, our equity investments provided $153 million in cash dividends to International Paper in 2018.
Looking ahead to the first quarter 2019, domestic industry conditions remain healthy.
We anticipate lower seasonal demand in North America Industrial Packaging and Brazil Papers, as well as lower export volume in Industrial Packaging, as customer destocking continues.
In Global Cellulose Fibers we anticipate lower volume due to slower growth in developing markets and customer destocking, as well as a temporary setback in fluff pulp volume resulting from poor execution of a mix improvement plan.
Consequently, we expect downward pressure on export price and mix in Industrial Packaging and Global Cellulose Fibers during the first quarter.
Operating costs are expected to increase in our three business segments due to lower volume, higher seasonal energy consumption and timing of spending.
In addition, planned maintenance outage expense is expected to increase significantly as we move from a low-outage fourth quarter to a heavy-outage first quarter, with first-half 2019 representing nearly 80% of total planned maintenance outage expense in 2019.
Input costs are expected to be stable in Industrial Packaging and Global Cellulose Fibers and increase modestly in Printing Papers, mainly due to higher wood costs in North America.
Lastly, we expect equity earnings for our Ilim joint venture to remain stable in the first quarter.
Looking to full-year 2019, we remain focused on maximizing value creation for our shareholders.
We anticipate meaningful growth in cash generation driven by commercial and operational excellence, lower capital expenditures and higher dividends from our equity investments.
We continue to see healthy box demand in North America Industrial Packaging and expect solid demand growth for fluff pulp used in absorbent hygiene products.
In Global Cellulose Fibers we expect our fluff pulp volume to recover as we execute on our mix improvement initiatives.
An excerpt. Shown here: 40 of 1,693 rewritten, 40 of 967 added and 40 of 602 removed. The counts are complete. For every sentence, read Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES in the FY2019 filing and the FY2018 filing.