Bowater Announces Fourth Quarter and 2003 Financial Results.Business Editors GREENVILLE Greenville. 1 City (1990 pop. 45,226), seat of Washington co., W Miss., on Lake Ferguson, a deepwater harbor adjoining the Mississippi River; inc. 1886. , S.C.--(BUSINESS WIRE)--Jan. 29, 2004 Bowater Bowater NYSE: BOW is an American pulp and paper company based in Greenville, South Carolina. Bowater has 12 pulp and paper mills in the United States, Canada and South Korea and 13 North American sawmills. It has approximately 10,000 employees. Incorporated (NYSE NYSE See: New York Stock Exchange : BOW Bow, river, Canada Bow (bō), river, 315 mi (507 km) long, rising in the Rocky Mts., S Alta., Canada, and flowing SE through Banff National Park. ) reported financial results for the fourth quarter and the full year 2003. Bowater reported a net loss of $50.9 million or $0.89 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, on sales of $735.6 million for the fourth quarter of 2003. These results compare with a net loss of $66.6 million, or $1.17 per diluted share, on sales of $666.3 million in the fourth quarter of 2002. Before special items, the net loss for the fourth quarter of 2003 was $39.5 million, or $0.69 per diluted share, compared with the 2002 fourth quarter net loss before special items of $43.7 million, or $0.77 per diluted share. Fourth quarter 2003 special items, net of tax, consisted of a $3.0 million gain related to asset sales, a severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when charge of $3.3 million, and an $11.1 million charge resulting from foreign currency changes. Special items, net of tax, in the fourth quarter of 2002 consisted of a $3.6 million gain related to asset sales, a severance charge of $8.1 million, an asset impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge of $19.1 million, and a $0.7 million gain resulting from foreign currency changes. For the full year of 2003, Bowater had a net loss of $205.0 million, or $3.60 per diluted share. This compares with a net loss of $142.4 million, or $2.50 per diluted share, in 2002. Sales in 2003 totaled $2.7 billion, compared with $2.6 billion in 2002. Several unusual events widened the company's loss for 2003: weather-related fiber cost increases, fiber shortages at our Ontario Ontario, city, United States Ontario, city (1990 pop. 133,179), San Bernardino co., S Calif., near Los Angeles, in a region of vineyards; inc. 1891. operations, the closure of a Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. paper machine, and completion of major capital programs at our South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. mill.
FINANCIAL HIGHLIGHTS
($ in millions, except per-share amounts)
Three months Twelve months
ended ended
December 31, December 31,
2003 2002 2003 2002
--------------------------------
Sales $735.6 $666.3 $2,721.1 $2,581.1
Net loss $(50.9)$(66.6) $(205.0) $(142.4)
Loss per diluted share (In accordance
with GAAP) $(0.89)$(1.17) $(3.60) $(2.50)
Special items, net of tax,
(per diluted share):
Sale of assets (gain) loss $(0.05)$(0.06) $(1.35) $(0.90)
Foreign exchange (gain) loss(1) $0.19 $(0.01) $1.09 $(0.03)
Severance charge $0.06 $0.14 $0.42 $0.14
Asset impairment charge $0.33 $0.33
Adoption of new accounting
standards - $0.08 -
--------------------------------
Loss per share excluding special
items $(0.69)$(0.77) $(3.36) $(2.96)
--------------------------------
(1) Primarily balance sheet translation of foreign denominated
accounts.
Bowater's average newsprint newsprint low grade paper used for newspapers. Old newspapers are fed to cattle as an alternative roughage and may occasionally be ingested by dogs. Significant amounts of lead are accumulated in tissues; no cases of poisoning have been recorded in cattle, though it has been selling price per metric ton increased $15 in the fourth quarter compared to the third quarter. Operating costs operating costs npl → gastos mpl operacionales per ton of production improved by 2% during the quarter. In the fourth quarter, Bowater curtailed approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 40,000 metric tons (Transparent Optical Networking Services) A marketing term for providing dark fiber to a customer. The customer is responsible for generating the transmission signal and interpreting it at the other end. See dark fiber. of newsprint production. The company has informed its North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. customers of a $50 per metric ton newsprint price increase effective February February: see month. 1, 2004. Bowater's average transaction price for coated and specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. papers increased $16 per short ton compared to the third quarter of 2003. Production and cost improvements at our Catawba Catawba, indigenous people of North America Catawba (kətô`bə), Native North Americans whose language belongs to the Siouan branch of the Hokan-Siouan linguistic stock (see Native American languages). , South Carolina facility reduced operating costs per ton by 4% in the fourth quarter compared to the third quarter. Bowater's average transaction price for market pulp increased $3 per metric ton compared to the third quarter of 2003. During the fourth quarter, the company incurred $9 million of additional cost and production was reduced by approximately 14,000 metric tons due primarily to scheduled recovery boiler Recovery boiler is the part of Kraft process of pulping where chemicals for white liquor are recovered and reformed from black liquor. In the process lignin of the wood, bound in black liquor at this phase, is burned and heat generated. maintenance at the Coosa Coosa (k  `sə), river, 286 mi (460 km) long, rising in NW Ga. and flowing SW through E Ala., joining the Tallapoosa near Montgomery, Ala., to form the Alabama River. Pines Pines , Isle ofSee Isle of Youth. and Thunder Bay Thunder Bay, city (1991 pop. 113,946), SW Ont., Canada, on Thunder Bay inlet of Lake Superior. The city was created in 1970 by the amalgamation of the twin cities of Fort William and Port Arthur and two adjoining townships. facilities. The company has informed its North American customers of a $20 per metric ton increase on softwood softwood Timber obtained from coniferous trees (mainly of the pine and fir families). With the exception of bald cypress, tamarack, and larch, softwood trees are evergreens. pulp grades effective February 1, 2004. "Our 2003 financial results were very disappointing, as the gradual The Gradual (Latin: graduale, sometimes called the Grail) is a chant in the extraordinary form of the Roman Catholic Mass, sung after the reading or singing of the Epistle and before the Alleluia, or, during penitential seasons, before the Tract. improvement in product pricing was offset by a stronger Canadian dollar Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents and the above described unusual events," said Arnold M. Nemirow, Bowater's Chairman, President and Chief Executive Officer. "We believe our actions to reduce costs and improve productivity, and an anticipated recovery in product pricing, should significantly improve our results in 2004." Bowater will hold a management conference call to discuss these financial results at 11:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy , January January: see month. 29, 2004. The conference call number is 888-428-4478 or 651-291-5254 (international). The call will also be broadcast via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the . Interested parties may connect to the Bowater web site at www.bowater.com, then follow the on-screen on·screen or on-screen adj. & adv. 1. As shown on a movie, television, or display screen. 2. Within public view; in public. instructions for access to the call and related information. A replay of the call will be available from 1:30 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. on Thursday Thursday: see week. , January 29, through Thursday, February 5, on the web site or by dialing 800-475-6701 or 320-365-3844 (international) and using the access code 716080. Bowater Incorporated, headquartered in Greenville, SC, is a leading producer of newsprint and coated groundwood papers. In addition, the company makes uncoated groundwood papers, bleached kraft pulp and lumber lumber, term for timber that has been cut into boards for use as a building material. The major steps in producing lumber involve logging (the felling and preparation of timber for shipment to sawmills), sawing the logs into boards, grading the boards according to products. The company has 12 pulp and paper mills in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of and South Korea Korea (kôrē`ə, kə–), Korean Hanguk or Choson, region and historic country (85,049 sq mi/220,277 sq km), E Asia. and 13 North American sawmills that produce softwood lumber. Bowater also operates two facilities that convert a groundwood base sheet to coated products. Bowater's operations are supported by approximately 1.4 million acres of timberlands owned or leased in the United States and Canada and 32 million acres of timber timber: see lumber; wood. cutting rights in Canada. Bowater is one of the world's largest consumers of recycled newspapers and magazines. Bowater common stock is listed on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. , the Pacific Exchange and the London Stock Exchange London Stock Exchange London marketplace for securities. It was formed in 1773 by a group of stockbrokers who had been doing business informally in local coffeehouses. . A special class of stock exchangeable into Bowater common stock is listed on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). :BWX BWX is a three-letter abbreviation with multiple meanings, as described below:
All amounts are in U.S. dollars. Statements in this news release that are not reported financial results or other historical information are "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. They include, for example, statements about our business outlook, assessment of market conditions, strategies, future plans, future sales, prices for our major products, inventory levels, capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. and tax rates. These forward-looking statements are not guarantees of future performance. They are based on management's expectations that involve a number of business risks and uncertainties, any of which could cause actual results to differ materially from those expressed in or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by the forward-looking statements. The risks and uncertainties relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the forward-looking statements in this news release include those described under the caption "Cautionary Statement Regarding Forward-Looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. Information" in Bowater's quarterly report on Form 10-Q Form 10-Q See 10-Q. for the quarter ended June June: see month. 30, 2003, and from time to time, in Bowater's other filings with the Securities and Exchange Commission. Information about industry or general economic conditions contained in this press release is derived de·rive v. de·rived, de·riv·ing, de·rives v.tr. 1. To obtain or receive from a source. 2. from third party sources that the company believes are widely accepted and accurate; however, the company has not independently verified ver·i·fy tr.v. ver·i·fied, ver·i·fy·ing, ver·i·fies 1. To prove the truth of by presentation of evidence or testimony; substantiate. 2. this information and cannot assure its accuracy.
BOWATER INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited, in millions except per share amounts)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2003 2002 2003 2002
------- ------- -------- --------
Sales $735.6 $666.3 $2,721.1 $2,581.1
Cost of sales, excluding
depreciation, amortization
and cost of timber harvested 567.1 525.2 2,194.0 2,020.7
Depreciation, amortization and
cost of timber harvested 86.0 83.7 339.0 340.5
Distribution costs 70.7 64.2 264.4 232.6
Selling and administrative
expense 40.9 41.0 148.6 140.2
Impairment of assets - 28.5 - 28.5
Net gain on sale of assets (1) 4.8 5.9 124.0 85.7
------ ------- -------- --------
Operating loss (24.3) (70.4) (100.9) (95.7)
Other expense (income):
Interest income (1.1) (1.3) (4.6) (4.5)
Interest expense, net of
capitalized interest 46.6 40.2 174.5 163.0
Foreign exchange loss (gain) 1.1 (0.7) 17.0 (6.1)
Other, net (1.5) 0.7 (6.9) 2.7
------ ------- -------- --------
45.1 38.9 180.0 155.1
------ ------- -------- --------
Loss before income taxes,
minority interests
and cumulative effect of
accounting changes (69.4) (109.3) (280.9) (250.8)
Provision for income tax benefit (17.7) (40.4) (70.1) (100.5)
Minority interests in the net
loss of subsidiaries (0.8) (2.3) (10.3) (7.9)
------ ------- -------- --------
Loss before cumulative effect of
accounting changes (50.9) (66.6) (200.5) (142.4)
Cumulative effect of accounting
changes (2) - - (4.5) -
------ ------- -------- --------
Net loss $(50.9) $ (66.6) $ (205.0) $ (142.4)
====== ======= ======== ========
Basic loss per common share: (3)
Loss before cumulative effect
of accounting changes $(0.89) $ (1.17) $ (3.52) $ (2.50)
Cumulative effect of
accounting changes - - (0.08) -
------ ------- -------- --------
Net loss $(0.89) $ (1.17) $ (3.60) $ (2.50)
====== ======= ======== ========
Average common shares
outstanding (3) 57.0 56.9 57.0 56.9
====== ======= ======== ========
Diluted loss per common
share: (3)
Loss before cumulative effect
of accounting changes $(0.89) $ (1.17) $ (3.52) $ (2.50)
Cumulative effect of accounting
changes - - (0.08) -
------ ------- -------- --------
Net loss $(0.89) $ (1.17) $ (3.60) $ (2.50)
====== ======= ======== ========
Average common and common
equivalent shares
outstanding (3) 57.0 56.9 57.0 56.9
====== ======= ======== ========
BOWATER INCORPORATED AND SUBSIDIARIES
(Unaudited, in millions of US dollars)
Consolidated Balance Sheet December 31, December 31,
2003 2002
------------ ------------
Current assets:
Cash and cash equivalents $19.4 $35.9
Accounts receivable, net 360.9 330.6
Inventories 293.1 257.2
Income tax receivable - 75.6
Other current assets 160.8 35.9
--------- --------
Total current assets 834.2 735.2
--------- --------
Timber and timberlands 184.1 212.0
Fixed assets, net 3,557.3 3,645.6
Goodwill 828.2 839.9
Other assets 211.6 157.6
--------- --------
$5,615.4 $5,590.3
========= ========
Current liabilities:
Current installments of
long-term debt $13.4 $84.3
Short-term bank debt 200.5 249.0
Accounts payable and
accrued liabilities 404.5 411.9
Dividends payable 11.7 11.2
--------- --------
Total current liabilities 630.1 756.4
--------- --------
Long-term debt, net of current
installments 2,292.4 2,037.4
Other long-term liabilities 505.4 450.7
Deferred income taxes 505.2 518.2
Minority interests in subsidiaries 69.3 72.1
Shareholders' equity 1,613.0 1,755.5
--------- --------
$5,615.4 $5,590.3
========= ========
Twelve Months Ended
Consolidated Cash Flow December 31,
------------------------
2003 2002
--------- --------
Cash flows from operating
activities $20.3 $41.2
--------- --------
Cash flows from (used for)
investing activities:
Cash invested in fixed assets,
timber and timberlands (216.3) (238.7)
Disposition of fixed assets,
timber and timberlands 154.3 26.5
Proceeds from monetization
of note receivable (1) - 88.1
Cash (invested) maturity of
marketable securities, net - 1.7
--------- --------
(62.0) (122.4)
--------- --------
Cash flows from (used for)
financing activities:
Cash dividends, including
minority interests (45.3) (49.6)
Financing activities, net 68.8 130.9
Stock options exercised 1.7 7.5
--------- --------
25.2 88.8
--------- --------
Net increase (decrease) in
cash and cash equivalents $(16.5) $7.6
========= ========
BOWATER INCORPORATED AND SUBSIDIARIES
Notes to the Press Release and Unaudited Consolidated
Financial Statements
(1) During the three months and year ended December 31, 2003,
Bowater sold fixed assets and land resulting in a net pre-tax
gain of $4.8 million, or $0.05 per diluted share after tax,
and $124.0 million, or $1.35 per diluted share after tax,
respectively. The 2003 pre-tax gain is primarily attributable
to the second quarter of 2003 sale of 81,768 acres of owned
and leased timberlands for aggregate consideration of $121.8
million. This transaction resulted in a pre-tax gain of
approximately $97.5 million. During the three months and year
ended December 31, 2002, Bowater sold fixed assets and land
resulting in a net pre-tax gain of $5.9 million, or $0.06 per
diluted share after tax, and $85.7 million, or $0.90 per
diluted share after tax, respectively. The 2002 pre-tax gain
is primarily attributable to the January 2002 sale of
approximately 116,000 acres of timberland for aggregate
consideration of $104.2 million, comprised of approximately
$5.1 million in cash and $99.1 million in a note receivable.
In March 2002, we monetized the $99.1 million note receivable
for net cash proceeds of $88.1 million. These transactions
resulted in a pre-tax gain of approximately $70.4 million.
(2) Effective July 1, 2003, Bowater early adopted, on a partial
basis, Financial Accounting Standards Board's Financial
Interpretation (FIN) No. 46, Consolidation of Variable
Interest Entities. In general, a variable interest entity is a
corporation, partnership, trust, or any other legal structure
used for business purposes that either (a) does not have
equity investors with voting rights or (b) has equity
investors that do not provide sufficient financial resources
for the entity to support its activities. FIN No. 46 requires
a variable interest entity to be consolidated by a company if
that company is subject to a majority of the risk of loss from
the variable interest entity's activities or entitled to
receive a majority of the entity's residual returns or both.
Many variable interest entities have commonly been referred to
as special-purpose entities (SPE) or off-balance sheet
structures. Bowater operated the Covington coating facility
under an operating lease with a special purpose entity. This
special purpose entity was determined to be a VIE and required
to be consolidated by Bowater in accordance with FIN 46.
Bowater early adopted FIN No. 46 for the Covington SPE
effective July 1, 2003 and consolidated assets and debt of
approximately $51.8 million and recorded a non-cash, after tax
cumulative effect charge of $2.4 million, or $0.04 per diluted
share in the third quarter of 2003. On August 11, 2003,
Bowater terminated the lease agreement with the SPE and paid
approximately $51.8 million to pay off the debt. Bowater will
finalize its adoption of FIN No. 46 in the first quarter of
2004. The finalization of adoption of FIN No. 46 is not
expected to have a material impact on our consolidated
financial statements.
Effective January 1, 2003, Bowater adopted Statement of
Financial Accounting Standards (SFAS) No. 143, "Accounting for
Asset Retirement Obligations." SFAS No. 143 requires entities
to record the fair value of a liability for an asset
retirement obligation in the period in which it is incurred.
The adoption of SFAS No. 143 resulted in non-cash, after tax
cumulative effect charges of $2.1 million, or $0.04 per
diluted share in the first quarter of 2003.
(3) For the calculation of basic and diluted earnings per share
for the three and twelve months ended December 31, 2003 and
2002, no adjustments to net income (loss) are necessary. The
effect of dilutive securities is not included in the
computation for the three and twelve months ended December 31,
2003 and 2002 to prevent antidilution.
(4) A reconciliation of certain financial statement line items
reported under generally accepted accounting principles
("GAAP") to earnings reported before special items is
presented below. We believe that this measure allows investors
to more easily compare our on-going operations and financial
performance from period to period. This measure is not as
complete as GAAP earnings; consequently, investors should rely
on GAAP earnings. In addition to GAAP earnings, we use the
other measures that we disclose in order to provide
perspective on our financial performance.
Three Months Ended December 31, 2003
(unaudited, in millions except per share amounts)
Adjustment for Special Items
Land &
GAAP as asset Foreign
reported sales exchange Severance
------------------------------------------
Operating income (loss) $(24.3) $(4.8) $- $5.0
Other expense (income)
Interest income (1.1)
Interest expense, net of
capitalized interest 46.6
Foreign exchange loss
(gain) 1.1 (1.1)
Other, net (1.5)
------------------------------------------
45.1 - (1.1) -
------------------------------------------
Loss before income taxes,
minority interests and
cumulative effect of
accounting changes (69.4) (4.8) 1.1 5.0
Provision for income tax
expense (benefit) (17.7) (1.8) (9.8) 1.7
Minority interests in the
net income (loss) of
subsidiaries (0.8) (0.2)
------------------------------------------
Income (loss) before
cumulative effect of
accounting changes (50.9) (3.0) 11.1 3.3
Cumulative effect of
accounting changes -
------------------------------------------
Net income (loss) $(50.9) $(3.0) $11.1 $3.3
------------------------------------------
Shares 57.0 57.0 57.0 57.0
------------------------------------------
EPS $(0.89) $(0.05) $0.19 $0.06
------------------------------------------
Effective tax rate 25.5% 38.0% -890.9% 34.0%
------------------------------------------
Three Months Ended December 31, 2003
(unaudited, in millions except per share amounts)
Adjustment for Special Items
Adoption
of new GAAP as
accounting adjusted for
Impairment standards Special items
------------------------------------------
Operating income (loss) $- $- $(24.1)
Other expense (income)
Interest income (1.1)
Interest expense, net of
capitalized interest 46.6
Foreign exchange loss
(gain) -
Other, net (1.5)
------------------------------------------
- - 44.0
------------------------------------------
Loss before income taxes,
minority interests and
cumulative effect of
accounting changes (68.1)
Provision for income tax
expense (benefit) (27.6)
Minority interests in the
net income (loss) of
subsidiaries (1.0)
------------------------------------------
Income (loss) before
cumulative effect of
accounting changes - - (39.5)
Cumulative effect of
accounting changes -
------------------------------------------
Net income (loss) $- $- $(39.5)
------------------------------------------
Shares 57.0
------------------------------------------
EPS $- $- $(0.69)
------------------------------------------
Effective tax rate - - 40.5%
------------------------------------------
Three Months Ended December 31, 2002
(unaudited, in millions except per share amounts)
Adjustment for Special Items
Land &
GAAP as asset Foreign
reported sales exchange Severance
------------------------------------------
Operating income (loss) $(70.4) $(5.9) $- $13.1
Other expense (income)
Interest income (1.3)
Interest expense, net of
capitalized interest 40.2
Foreign exchange loss (gain) (0.7) 0.7
Other, net 0.7
----------------------------------------
38.9 - 0.7 -
----------------------------------------
Loss before income taxes,
minority interests and
cumulative effect of
accounting changes (109.3) (5.9) (0.7) 13.1
Provision for income tax
expense (benefit) (40.4) (2.3) 0.1 5.0
Minority interests in the
net income (loss) of
subsidiaries (2.3) (0.1)
----------------------------------------
Income (loss) before
cumulative effect of
accounting changes (66.6) (3.6) (0.7) 8.1
Cumulative effect of
accounting changes -
----------------------------------------
Net income (loss) $(66.6) $(3.6) $(0.7) $8.1
----------------------------------------
Shares 56.9 56.9 56.9 56.9
----------------------------------------
EPS $(1.17) $(0.06) $(0.01) $0.14
----------------------------------------
Effective tax rate 37.0% 39.0% -14.3% 38.2%
----------------------------------------
Three Months Ended December 31, 2002
(unaudited, in millions except per share amounts)
Adjustment for Special Items
GAAP as
Adoption adjusted
of new for
accounting Special
Impairment standards items
----------------------------------------
Operating income (loss) $28.5 $- $(34.7)
Other expense (income)
Interest income (1.3)
Interest expense, net of
capitalized interest 40.2
Foreign exchange loss (gain) -
Other, net 0.7
----------------------------------------
- - 39.6
----------------------------------------
Loss before income taxes,
minority interests and
cumulative effect of
accounting changes 28.5 - (74.3)
Provision for income tax
expense (benefit) 9.4 (28.2)
Minority interests in the
net income (loss) of
subsidiaries (2.4)
----------------------------------------
Income (loss) before
cumulative effect of
accounting changes 19.1 - (43.7)
Cumulative effect of
accounting changes -
----------------------------------------
Net income (loss) $19.1 $- $(43.7)
----------------------------------------
Shares 56.9 - 56.9
----------------------------------------
EPS $0.33 $- $(0.77)
----------------------------------------
Effective tax rate 33.0% - 38.0%
----------------------------------------
Twelve Months Ended December 31, 2003
(unaudited, in millions except per share amounts)
Adjustment for Special Items
Land &
GAAP as asset Foreign
reported sales exchange Severance
----------------------------------------
Operating income (loss) $(100.9) $(124.0) $- $37.2
Other expense (income)
Interest income (4.6)
Interest expense, net of
capitalized interest 174.5
Foreign exchange loss (gain) 17.0 (17.0)
Other, net (6.9)
----------------------------------------
180.0 - (17.0) -
----------------------------------------
Loss before income taxes,
minority interests and
cumulative effect of
accounting changes (280.9) (124.0) 17.0 37.2
Provision for income tax
expense (benefit) (70.1) (47.1) (43.4) 13.2
Minority interests in the
net income (loss) of
subsidiaries (10.3) (1.6)
----------------------------------------
Income (loss) before
cumulative effect of
accounting changes (200.5) (76.9) 62.0 24.0
Cumulative effect of
accounting changes (4.5)
----------------------------------------
Net income (loss) $(205.0) $(76.9) $62.0 $24.0
----------------------------------------
Shares 57.0 57.0 57.0 57.0
----------------------------------------
EPS $(3.60) $(1.35) $1.09 $0.42
----------------------------------------
Effective tax rate 25.0% 38.0% -255.3% 35.5%
----------------------------------------
Twelve Months Ended December 31, 2003
(unaudited, in millions except per share amounts)
Adjustment for Special Items
GAAP as
Adoption adjusted
of new for
accounting Special
Impairment standards items
----------------------------------------
Operating income (loss) $- $- $(187.7)
Other expense (income)
Interest income (4.6)
Interest expense, net of
capitalized interest 174.5
Foreign exchange loss (gain) -
Other, net (6.9)
----------------------------------------
- - 163.0
----------------------------------------
Loss before income taxes,
minority interests and
cumulative effect of
accounting changes (350.7)
Provision for income tax
expense (benefit) (147.4)
Minority interests in the
net income (loss) of
subsidiaries (11.9)
----------------------------------------
Income (loss) before
cumulative effect of
accounting changes - - (191.4)
Cumulative effect of
accounting changes 4.5 -
----------------------------------------
Net income (loss) $- $4.5 $(191.4)
----------------------------------------
Shares - 57.0 57.0
----------------------------------------
EPS $- $0.08 $(3.36)
----------------------------------------
Effective tax rate - - 42.0%
----------------------------------------
Twelve Months Ended December 31, 2002
(unaudited, in millions except per share amounts)
Adjustment for Special Items
Land &
GAAP as asset Foreign
reported sales exchange Severance
--------------------------------------------
Operating income (loss) $(95.7) $(85.7) $- $13.1
Other expense (income)
Interest income (4.5)
Interest expense, net of
capitalized interest 163.0
Foreign exchange loss
(gain) (6.1) 6.1
Other, net 2.7
--------------------------------------------
155.1 - 6.1 -
--------------------------------------------
Loss before income
taxes, minority
interests and
cumulative effect of
accounting changes (250.8) (85.7) (6.1) 13.1
Provision for income tax
expense (benefit) (100.5) (34.3) (5.0) 5.0
Minority interests in
the net income (loss)
of subsidiaries (7.9) 0.5
--------------------------------------------
Income (loss) before
cumulative effect of
accounting changes (142.4) (51.4) (1.6) 8.1
Cumulative effect of
accounting changes -
--------------------------------------------
Net income (loss) $(142.4) $(51.4) $(1.6) $8.1
--------------------------------------------
Shares 56.9 56.9 56.9 56.9
--------------------------------------------
EPS $(2.50) $(0.90) $(0.03) $0.14
--------------------------------------------
Effective tax rate 40.1% 40.0% 82.0% 38.2%
--------------------------------------------
Twelve Months Ended December 31, 2002
(unaudited, in millions except per share amounts)
Adjustment for Special Items
GAAP as
Adoption adjusted
of new for
accounting Special
Impairment standards items
--------------------------------------------
Operating income (loss) $28.5 $- $(139.8)
Other expense (income)
Interest income (4.5)
Interest expense, net of
capitalized interest 163.0
Foreign exchange loss
(gain) -
Other, net 2.7
--------------------------------------------
- - 161.2
--------------------------------------------
Loss before income
taxes, minority
interests and
cumulative effect of
accounting changes 28.5 (301.0)
Provision for income tax
expense (benefit) 9.4 (125.4)
Minority interests in
the net income (loss)
of subsidiaries (7.4)
--------------------------------------------
Income (loss) before
cumulative effect of
accounting changes 19.1 - (168.2)
Cumulative effect of
accounting changes -
--------------------------------------------
Net income (loss) $19.1 $- $(168.2)
--------------------------------------------
Shares 56.9 - 56.9
--------------------------------------------
EPS $0.33 $- $(2.96)
--------------------------------------------
Effective tax rate 33.0% - 41.7%
--------------------------------------------
A schedule of historical financial and operating statistics is
available upon request and on Bowater's web site
(www.bowater.com).
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