Champion International Corporation Reports Strong First Quarter Earnings.Business Editors STAMFORD Stamford, town, England Stamford, town (1991 pop. 18,127), in the Parts of Kesteven, Lincolnshire, E central England, on the Welland River. It is a market town. Products include diesel engines, electrical equipment, bricks, and tiles. , Conn.--(BUSINESS WIRE)--April 10, 2000 Champion International Corporation (NYSE NYSE See: New York Stock Exchange :CHA n. 1. Tea; - the Chinese (Mandarin) name, used generally in early works of travel, and now for a kind of rolled tea used in Central Asia. A pot with hot water . . . made with the powder of a certain herb called chaa, which is much esteemed. - Tr. J. ) today reported first quarter net income of $98 million or $1.01 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. The company had net income of $3 million or $.03 per share, excluding a special item, in the first quarter of 1999 and net income of $79 million or $.82 per diluted share, before an extraordinary item, in the fourth quarter of 1999. First quarter 1999 results excluded earnings of $.40 per share reflecting the impact of the devaluation devaluation, decreasing the value of one nation's currency relative to gold or the currencies of other nations. It is usually undertaken as a means of correcting a deficit in the balance of payments. of the Brazilian currency on U.S.-denominated investments held by the company's Brazilian operation. "We are extremely pleased with the results of the first quarter," said Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a E. Olson Olson may refer to:
n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about the company's earnings potential for the balance of 2000." The company's pulp and paper operations in North and South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. reported operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $142 million compared to $28 million in the first quarter of 1999 and $130 million in the fourth quarter of last year. The improvement from the year-ago quarter was due primarily to improved prices for pulp and most of the company's major paper grades. The improvement from the last quarter was due mainly to higher prices for pulp and coated freesheet papers and improved product mix in the uncoated freesheet business. The company's wood products segment reported income from operations of $57 million compared to $42 million in the first quarter of 1999 and $53 million in the fourth quarter of 1999. The improvement from the first quarter of 1999 was due primarily to increased shipments and higher prices for Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. 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 and plywood plywood, manufactured board composed of an odd number of thin sheets of wood glued together under pressure with grains of the successive layers at right angles. Laminated wood differs from plywood in that the grains of its sheets are parallel. and higher West Coast timber timber: see lumber; wood. sales. The improvement from the fourth quarter of 1999 was due mainly to higher U.S. and Canadian plywood shipments and prices. In February February: see month. of this year, Champion announced an agreement to merge See mail merge and concatenate. with the Finnish forest products company UPM-Kymmene. In commenting on the merger, Olson said, "I am convinced con·vince tr.v. con·vinced, con·vinc·ing, con·vinc·es 1. To bring by the use of argument or evidence to firm belief or a course of action. See Synonyms at persuade. 2. that our two companies have a tremendous opportunity to create the premier global forest products company." 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. in this release are made pursuant to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. provisions 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. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results and company plans and objectives to differ materially from those expressed in the forward-looking statements. Such risks and uncertainties include, but are not limited to, changes 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. and international economies; changes in worldwide demand for the company's products; changes in worldwide production and production capacity in the forest products industry; competitive pricing pressures for the company's products; changes in raw material, energy, and other costs; and currency fluctuations.
CHAMPION INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME (Unaudited)
(in millions, except per share)
Three Months Ended
-----------------------------------
March 31, December 31, March 31,
2000 1999 1999
-----------------------------------
Net Sales (Note 1) $ 1,368 $ 1,348 $ 1,275
========= ========= =========
Income Before Income Taxes:
Pulp and Paper:
North America $ 87 $ 77 $ (10)
Brazil 49 50 32
Distribution 6 3 6
--------- --------- ---------
Total Pulp and Paper 142 130 28
Wood Products 57 53 42
General corporate expense (6) (14) (9)
Interest and debt expense (50) (58) (63)
Other income (expense)
- net (Note 2) 6 4 43
--------- --------- ---------
Income Before Income Taxes and 149 115 41
Extraordinary Item
Income Taxes (Benefit) 51 36 (1)
--------- --------- ---------
Income Before Extraordinary Item 98 79 42
Extraordinary Item - Loss on
Early Retirement
of Debt, Net of Taxes - (2) -
--------- --------- ---------
Net Income $ 98 $ 77 $ 42
========= ========= =========
Average number of common
shares outstanding 96.5 96.1 95.6
========= ========= =========
Basic Earnings Per Common Share:
Income Before
Extraordinary Item $ 1.01 $ .83 $ .44
Extraordinary Item - (.03) -
--------- --------- ---------
Net Income $ 1.01 $ .80 $ .44
========= ========= =========
Diluted Earnings Per Common Share:
Income Before
Extraordinary Item $ 1.01 $ .82 $ .43
Extraordinary Item - (.03) -
--------- --------- ---------
Net Income $ 1.01 $ .79 $ .43
========= ========= =========
CHAMPION INTERNATIONAL CORPORATION AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS (Unaudited)
(in millions of dollars)
Three Months Ended
-----------------------------------
March 31, December 31, March 31,
2000 1999 1999
-----------------------------------
Note 1:
Net Sales by Business Segment:
Pulp and Paper:
North America $ 692 $ 694 $ 711
Brazil 116 117 86
Distribution 233 220 200
--------- --------- ---------
Total Pulp and Paper 1,041 1,031 997
Wood Products 327 317 278
--------- --------- ---------
Total $ 1,368 $ 1,348 $ 1,275
========= ========= =========
Note 2: Other income (expense) - net for the three months ended March
31, 1999 included a net foreign currency transaction gain of
$38.6 million for the company's Brazilian operations.
CHAMPION INTERNATIONAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(in millions of dollars)
March 31, December 31,
2000 1999
(unaudited)
------------------------------
ASSETS:
Cash and temporary cash investments $ 287 $ 418
Receivables - net 551 540
Inventories 473 421
Prepaid expenses 22 24
Deferred income taxes 78 79
---------- ---------
Total Current Assets 1,411 1,482
Timber and timberlands - net 2,288 2,273
Property, plant and equipment - net 3,873 3,876
Other assets and deferred charges 841 687
---------- ---------
Total Assets $ 8,413 $ 8,318
========== =========
LIABILITIES AND SHAREHOLDERS' EQUITY:
Accounts payable and
accrued liabilities $ 645 $ 691
Current installments of
long-term debt 128 127
Short-term borrowings 111 72
Income taxes 16 33
---------- ---------
Total Current Liabilities 900 923
Long-term debt 2,526 2,526
Other liabilities 827 813
Deferred income taxes 973 961
Shareholders' Equity 3,187 3,095
---------- ---------
Total Liabilities and
Shareholders' Equity $ 8,413 $ 8,318
========== =========
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