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RIVERWOOD INTERNATIONAL REPORTS SECOND QUARTER RESULTS

 ATLANTA, July 20 /PRNewswire/ -- Riverwood International Corp. (NYSE: RVW) today reported second quarter net sales of $293.2 million, up $11.0 million, or 3.9 percent, from the second quarter of 1992. Income from operations for the three months ended June 26, 1993 was $27.7 million, down $17.7 million, or 39.0 percent, from the like period last year. Net income for the quarter was $3.8 million, or 6 cents per share, down 72.9 percent compared with $13.9 million, or 28 cents per share, in 1992. The weighted average common shares outstanding used to compute earnings per share were approximately 62 million in 1993 and approximately 50 million in 1992.
 For the first six months of 1993, net sales were $553.9 million, up 4.2 percent compared with $531.5 million for the first six months of 1992. Income from operations for the first six months of 1993 was $49.6 million, down 36.1 percent compared with $77.6 million for the corresponding period in 1992. Net income was $9.6 million, or 15 cents per share, down 65.5 percent from $27.8 million, or 55 cents per share, last year. The weighted average common shares outstanding used to compute earnings per share were approximately 62 million in 1993 and approximately 50 million in 1992.
 Net income for the six months of 1993 was reduced by approximately $9.0 million of incremental interest expense, net of tax, associated with last year's recapitalization, public debt offering and acquisition of the Macon, Ga. paperboard mill. This was partially offset by a $4.8 million net reduction in deferred income taxes due to recent Brazil tax law changes.
 SECOND QUARTER OVERVIEW
 Net sales in the second quarter included $22.4 million of sales from the Macon mill that was acquired in mid-1992. Stronger U.S. dollar currency exchange rates in the second quarter of 1993 compared with 1992 resulted in approximately a $9.7 million decline in reported net sales in the Coated Board System segment.
 The reduction in income from operations for the second quarter was due mainly to a loss in the Containerboard segment and an earnings decline in the Coated Board System segment. These declines were partially offset by a strong increase in the U.S. Timberlands/Wood Products segment.
 The Containerboard segment reported a loss from operations of $7.4 million, compared with income from operations of $4.4 million in the 1992 second quarter. This reflects lower linerboard prices and a loss at the Macon mill. The Brazilian operations continued to be profitable, despite weak worldwide linerboard markets.
 About half of the Coated Board System segment decline in earnings was related to the cost of packaging machinery development and expansion of multiple packaging markets. Additionally, earnings were negatively affected by the weakness in the worldwide folding carton market, while the beverage carrier market remained steady.
 Income from operations in the second quarter for the company's third business segment, U.S. Timberlands/Wood Products, increased by $4.1 million due to higher lumber and plywood selling prices compared with a year ago.
 OUTLOOK
 "Based on our most recent view that weak conditions in the linerboard markets will continue, Riverwood International will show a significant annual decrease in income from operations and net income compared with 1992," said Thomas H. Johnson, Riverwood president and chief executive officer. "Our expectation for the remainder of the year is that the trends experienced in the first half will continue. As a result of the weak linerboard markets, we will continue to evaluate our linerboard production schedules in light of high industry inventory levels. Additionally, we will focus on market expansion and packaging machinery development for the beverage markets and the capital expansion to start up the Macon coated board machine in 1994.
 "Our capital expenditure program to upgrade and convert the Macon mill to coated board production is on budget and on schedule. With regard to the timing of that project, we now anticipate having limited coated board production available to meet the 1994 beverage season.
 "We remain confident about the business outlook for our primary business segment -- the Coated Board System -- for 1994 and beyond. The marketplace is responding favorably to our investment in packaging machinery design and development with increased demand for our systems."
 Riverwood International is a global packaging systems and paper products company. At the end of 1992, the company employed more than 8,500 people worldwide and had assets of approximately $1.9 billion and annual sales of approximately $1.1 billion. The company is headquartered in Atlanta and has seven major business operations spanning North America, Europe, Asia-Pacific, Central America and South America.
 RIVERWOOD INTERNATIONAL CORP.
 CONSOLIDATED STATEMENTS OF INCOME
 (In millions of dollars, except per share amounts)
 Unaudited
 Three Months Percent Six Months Percent
 Ended Inc./ Ended Inc./
 6/26/93 6/27/92 (Dec.) 6/26/93 6/27/92 (Dec.)
 Net Sales $293.2 $282.2 3.9 $553.9 $531.5 4.2
 Cost of Sales 229.1 208.0 10.2 433.7 395.8 9.6
 Selling, General and
 Administrative 29.7 25.8 15.4 60.0 52.0 15.4
 Research, Development
 and Engineering 2.4 1.6 49.9 4.3 3.1 37.0
 Other Income (Expense),
 net (4.3) (1.4) 192.3 (6.3) (3.0) 107.9
 Income from
 Operations 27.7 45.4 (39.0) 49.6 77.6 (36.1)
 Interest Income 1.2 0.5 163.5 2.3 0.7 215.9
 Interest Expense 21.6 20.6 4.3 42.7 27.7 53.8
 Income before
 Income Taxes 7.3 25.3 (70.9) 9.2 50.6 (81.7)
 Income Tax Expense
 (Benefit) 3.5 11.4 (68.4) (0.4) 22.8 ---
 Net Income $3.8 $13.9 (72.9) $9.6 $27.8 (65.5)
 Earnings per Common
 Share Data:
 Weighted Average Common
 Shares (000) 62,051 50,482 --- 62,051 50,222 ---
 Earnings per
 Common Share $0.06 $0.28 --- $0.15 $0.55 ---
 RIVERWOOD INTERNATIONAL CORP.
 BUSINESS SEGMENT DATA
 (In millions of dollars)
 Unaudited
 Three Months Percent
 Ended Increase/
 6/26/93 6/27/92 (Decrease)
 NET SALES
 Coated Board System $198.9 $212.2 (6.3)
 Containerboard 63.7 44.0 45.0
 U. S. Timberlands/Wood Products 35.2 30.3 16.1
 Eliminations (4.6) (4.3) 7.3
 $293.2 $282.2 3.9
 INCOME FROM OPERATIONS
 Coated Board System $29.9 $39.4 (24.0)
 Containerboard (7.4) 4.4 ---
 U. S. Timberlands/Wood Products 10.4 6.3 64.9
 Eliminations (5.2) (4.7) 13.3
 $27.7 $45.4 (39.0)
 Six Months Percent
 Ended Increase/
 6/26/93 6/27/92 (Decrease)
 NET SALES
 Coated Board System $370.1 $399.4 (7.3)
 Containerboard 121.7 81.9 48.7
 U. S. Timberlands/Wood Products 71.4 58.8 21.4
 Eliminations (9.3) (8.6) 8.5
 $553.9 $531.5 4.2
 INCOME FROM OPERATIONS
 Coated Board System $50.5 $66.6 (24.1)
 Containerboard (12.0) 8.3 ---
 U. S. Timberlands/Wood Products 23.2 13.3 74.5
 Eliminations (12.1) (10.6) 15.0
 $49.6 $77.6 (36.1)
 RIVERWOOD INTERNATIONAL CORP.
 Notes to Consolidated Statements of Income
 Note 1
 On June 24, 1992, Riverwood completed an initial public offering of 19.5 percent of its common stock, or 12,100,000 shares, for gross proceeds of $172 million and issued $400 million of bonds in a public debt offering. The debt offering consisted of $150 million, 10.75 percent, Senior Notes due 2000 and $250 million, 11.25 percent, Senior Subordinated Notes due 2002. Net proceeds from the two offerings amounted to approximately $553 million. Manville Corp. (NYSE: MVL) continues to own 80.5 percent of Riverwood International common stock as well as intercompany debt.
 Note 2
 Due to recent changes in Brazil's tax laws, Riverwood recognized a net $4.8 million deferred tax benefit in the first quarter of 1993. The primary effect of the tax law changes allowed Riverwood to accelerate its payments of deferred income taxes on inflationary profits at reduced tax rates. Excluding the Brazilian tax benefit, Riverwood's 1993 effective tax rate is approximately 48 percent.
 -0- 7/20/93
 /CONTACT: Jim Caverlee (Financial), 404-644-3023; or Jonna Manes (Media), 404-644-3014, both of Riverwood International/
 (RVW MVL)


CO: Riverwood International Corp. ST: Georgia IN: PAP SU: ERN

BB -- DV002 -- 3342 07/20/93 06:31 EDT
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