2016 Q4 Form 10-K Financial Statement

#000007567717000004 Filed on February 28, 2017

View on sec.gov

Income Statement

Concept 2016 Q4 2016 2015 Q4
Revenue $1.477B $5.779B $1.391B
YoY Change 6.16% 0.65% -3.01%
Cost Of Revenue $1.150B $4.503B $1.106B
YoY Change 3.95% -0.68% -2.74%
Gross Profit $327.1M $1.276B $285.0M
YoY Change 14.77% 5.64% -4.04%
Gross Profit Margin 22.15% 22.08% 20.49%
Selling, General & Admin $125.1M $468.5M $105.4M
YoY Change 18.69% 3.81% -4.62%
% of Gross Profit 38.25% 36.71% 36.98%
Research & Development $13.30M
YoY Change 1.53%
% of Gross Profit 1.04%
Depreciation & Amortization $93.70M $358.0M $82.80M
YoY Change 13.16% 0.42% -2.7%
% of Gross Profit 28.65% 28.05% 29.05%
Operating Expenses $119.8M $481.8M $104.5M
YoY Change 14.64% 3.75% -5.86%
Operating Profit $192.9M $783.3M $175.9M
YoY Change 9.66% 4.44% 1.56%
Interest Expense -$24.30M -$91.80M -$22.30M
YoY Change 8.97% 7.37% -3.46%
% of Operating Profit -12.6% -11.72% -12.68%
Other Income/Expense, Net
YoY Change
Pretax Income $168.6M $688.5M $153.6M
YoY Change 9.77% 3.61% 2.33%
Income Tax $57.90M $238.9M $49.40M
% Of Pretax Income 34.34% 34.7% 32.16%
Net Earnings $110.6M $449.6M $104.3M
YoY Change 6.04% 2.93% 5.89%
Net Earnings / Revenue 7.49% 7.78% 7.5%
Basic Earnings Per Share $1.17 $4.76 $1.07
Diluted Earnings Per Share $1.17 $4.75 $1.07
COMMON SHARES
Basic Shares Outstanding 94.23M shares 93.50M 97.00M shares
Diluted Shares Outstanding 93.70M

Balance Sheet

Concept 2016 Q4 2016 2015 Q4
SHORT-TERM ASSETS
Cash & Short-Term Investments $239.3M $239.3M $184.2M
YoY Change 29.91% 29.91% 47.48%
Cash & Equivalents $239.3M $239.3M $184.2M
Short-Term Investments
Other Short-Term Assets $30.30M $30.30M $28.80M
YoY Change 5.21% 5.21% -53.47%
Inventory $723.6M $723.6M $676.8M
Prepaid Expenses
Receivables $689.2M $689.2M $636.5M
Other Receivables $13.90M $13.90M $28.20M
Total Short-Term Assets $1.696B $1.696B $1.555B
YoY Change 9.12% 9.12% 3.43%
LONG-TERM ASSETS
Property, Plant & Equipment $2.896B $2.896B $2.832B
YoY Change 2.25% 2.25% -0.89%
Goodwill $737.9M $544.0M
YoY Change 35.64% -0.51%
Intangibles
YoY Change
Long-Term Investments
YoY Change
Other Assets $80.00M $80.00M $70.90M
YoY Change 12.83% 12.83% -1.53%
Total Long-Term Assets $4.081B $4.081B $3.718B
YoY Change 9.76% 9.76% -1.01%
TOTAL ASSETS
Total Short-Term Assets $1.696B $1.696B $1.555B
Total Long-Term Assets $4.081B $4.081B $3.718B
Total Assets $5.777B $5.777B $5.272B
YoY Change 9.57% 9.57% 0.26%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $323.8M $323.8M $294.2M
YoY Change 10.06% 10.06% -10.98%
Accrued Expenses $201.2M $214.6M $193.5M
YoY Change 3.98% 3.87% -12.05%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $25.80M $27.10M $6.500M
YoY Change 296.92% 251.95% 0.0%
Total Short-Term Liabilities $625.4M $625.4M $561.9M
YoY Change 11.3% 11.3% -8.04%
LONG-TERM LIABILITIES
Long-Term Debt $2.620B $2.640B $2.290B
YoY Change 14.39% 14.2% -2.49%
Other Long-Term Liabilities $59.60M $416.8M $59.50M
YoY Change 0.17% -0.31% -18.27%
Total Long-Term Liabilities $3.392B $3.057B $3.077B
YoY Change 10.23% 11.98% -2.02%
TOTAL LIABILITIES
Total Short-Term Liabilities $625.4M $625.4M $561.9M
Total Long-Term Liabilities $3.392B $3.057B $3.077B
Total Liabilities $4.017B $4.017B $3.639B
YoY Change 10.39% 10.39% -3.0%
SHAREHOLDERS EQUITY
Retained Earnings $1.447B $1.317B
YoY Change 9.85% 6.05%
Common Stock $452.3M $440.9M
YoY Change 2.59% 1.8%
Preferred Stock
YoY Change
Treasury Stock (at cost) $0.00
YoY Change
Treasury Stock Shares 0.000 shares
Shareholders Equity $1.760B $1.760B $1.633B
YoY Change
Total Liabilities & Shareholders Equity $5.777B $5.777B $5.272B
YoY Change 9.57% 9.57% -0.01%

Cashflow Statement

Concept 2016 Q4 2016 2015 Q4
OPERATING ACTIVITIES
Net Income $110.6M $449.6M $104.3M
YoY Change 6.04% 2.93% 5.89%
Depreciation, Depletion And Amortization $93.70M $358.0M $82.80M
YoY Change 13.16% 0.42% -2.7%
Cash From Operating Activities $213.4M $806.9M $220.6M
YoY Change -3.26% 5.81% 22.97%
INVESTING ACTIVITIES
Capital Expenditures -$87.20M $274.3M -$99.70M
YoY Change -12.54% -12.78% -40.01%
Acquisitions $485.4M
YoY Change
Other Investing Activities -$99.70M -$500.0K $4.400M
YoY Change -2365.91% -88.1% -438.46%
Cash From Investing Activities -$186.9M -$769.6M -$95.30M
YoY Change 96.12% 158.17% -43.1%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $100.3M
YoY Change -35.16%
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -67.00M 17.80M -128.0M
YoY Change -47.66% -104.39% 209.93%
NET CHANGE
Cash From Operating Activities 213.4M 806.9M 220.6M
Cash From Investing Activities -186.9M -769.6M -95.30M
Cash From Financing Activities -67.00M 17.80M -128.0M
Net Change In Cash -40.50M 55.10M -2.700M
YoY Change 1400.0% -7.08% -90.82%
FREE CASH FLOW
Cash From Operating Activities $213.4M $806.9M $220.6M
Capital Expenditures -$87.20M $274.3M -$99.70M
Free Cash Flow $300.6M $532.6M $320.3M
YoY Change -6.15% 18.86% -7.32%

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25700000 USD
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5100000 USD
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P6Y
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5400000 USD
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4400000 USD
CY2015Q4 us-gaap Unrecognized Tax Benefits
UnrecognizedTaxBenefits
5800000 USD
CY2016Q4 us-gaap Unrecognized Tax Benefits
UnrecognizedTaxBenefits
5200000 USD
CY2014 us-gaap Unrecognized Tax Benefits Decreases Resulting From Prior Period Tax Positions
UnrecognizedTaxBenefitsDecreasesResultingFromPriorPeriodTaxPositions
900000 USD
CY2015 us-gaap Unrecognized Tax Benefits Decreases Resulting From Prior Period Tax Positions
UnrecognizedTaxBenefitsDecreasesResultingFromPriorPeriodTaxPositions
0 USD
CY2016 us-gaap Unrecognized Tax Benefits Decreases Resulting From Prior Period Tax Positions
UnrecognizedTaxBenefitsDecreasesResultingFromPriorPeriodTaxPositions
100000 USD
CY2014 us-gaap Unrecognized Tax Benefits Decreases Resulting From Settlements With Taxing Authorities
UnrecognizedTaxBenefitsDecreasesResultingFromSettlementsWithTaxingAuthorities
500000 USD
CY2015 us-gaap Unrecognized Tax Benefits Decreases Resulting From Settlements With Taxing Authorities
UnrecognizedTaxBenefitsDecreasesResultingFromSettlementsWithTaxingAuthorities
700000 USD
CY2016 us-gaap Unrecognized Tax Benefits Decreases Resulting From Settlements With Taxing Authorities
UnrecognizedTaxBenefitsDecreasesResultingFromSettlementsWithTaxingAuthorities
300000 USD
CY2014 us-gaap Unrecognized Tax Benefits Increases Resulting From Current Period Tax Positions
UnrecognizedTaxBenefitsIncreasesResultingFromCurrentPeriodTaxPositions
300000 USD
CY2015 us-gaap Unrecognized Tax Benefits Increases Resulting From Current Period Tax Positions
UnrecognizedTaxBenefitsIncreasesResultingFromCurrentPeriodTaxPositions
400000 USD
CY2016 us-gaap Unrecognized Tax Benefits Increases Resulting From Current Period Tax Positions
UnrecognizedTaxBenefitsIncreasesResultingFromCurrentPeriodTaxPositions
500000 USD
CY2014 us-gaap Unrecognized Tax Benefits Increases Resulting From Prior Period Tax Positions
UnrecognizedTaxBenefitsIncreasesResultingFromPriorPeriodTaxPositions
1000000 USD
CY2015 us-gaap Unrecognized Tax Benefits Increases Resulting From Prior Period Tax Positions
UnrecognizedTaxBenefitsIncreasesResultingFromPriorPeriodTaxPositions
2800000 USD
CY2016 us-gaap Unrecognized Tax Benefits Increases Resulting From Prior Period Tax Positions
UnrecognizedTaxBenefitsIncreasesResultingFromPriorPeriodTaxPositions
0 USD
CY2015Q4 us-gaap Unrecognized Tax Benefits Interest On Income Taxes Accrued
UnrecognizedTaxBenefitsInterestOnIncomeTaxesAccrued
1000000 USD
CY2016Q4 us-gaap Unrecognized Tax Benefits Interest On Income Taxes Accrued
UnrecognizedTaxBenefitsInterestOnIncomeTaxesAccrued
1100000 USD
CY2014 us-gaap Unrecognized Tax Benefits Reductions Resulting From Lapse Of Applicable Statute Of Limitations
UnrecognizedTaxBenefitsReductionsResultingFromLapseOfApplicableStatuteOfLimitations
900000 USD
CY2015 us-gaap Unrecognized Tax Benefits Reductions Resulting From Lapse Of Applicable Statute Of Limitations
UnrecognizedTaxBenefitsReductionsResultingFromLapseOfApplicableStatuteOfLimitations
1100000 USD
CY2016 us-gaap Unrecognized Tax Benefits Reductions Resulting From Lapse Of Applicable Statute Of Limitations
UnrecognizedTaxBenefitsReductionsResultingFromLapseOfApplicableStatuteOfLimitations
700000 USD
CY2016Q4 us-gaap Unrecognized Tax Benefits That Would Impact Effective Tax Rate
UnrecognizedTaxBenefitsThatWouldImpactEffectiveTaxRate
3900000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Balance On Fifth Anniversary
UnrecordedUnconditionalPurchaseObligationBalanceOnFifthAnniversary
17700000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Balance On Fourth Anniversary
UnrecordedUnconditionalPurchaseObligationBalanceOnFourthAnniversary
21400000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Balance On Second Anniversary
UnrecordedUnconditionalPurchaseObligationBalanceOnSecondAnniversary
34000000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Balance On Third Anniversary
UnrecordedUnconditionalPurchaseObligationBalanceOnThirdAnniversary
27800000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Balance Sheet Amount
UnrecordedUnconditionalPurchaseObligationBalanceSheetAmount
240000000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Due After Five Years
UnrecordedUnconditionalPurchaseObligationDueAfterFiveYears
45700000 USD
CY2016Q4 us-gaap Unrecorded Unconditional Purchase Obligation Due In Next Rolling Twelve Months
UnrecordedUnconditionalPurchaseObligationDueInNextRollingTwelveMonths
93400000 USD
CY2015Q4 us-gaap Variable Interest Entity Consolidated Carrying Amount Assets
VariableInterestEntityConsolidatedCarryingAmountAssets
4500000 USD
CY2016Q4 us-gaap Variable Interest Entity Consolidated Carrying Amount Assets
VariableInterestEntityConsolidatedCarryingAmountAssets
5000000 USD
CY2015Q4 us-gaap Variable Interest Entity Consolidated Carrying Amount Liabilities
VariableInterestEntityConsolidatedCarryingAmountLiabilities
4500000 USD
CY2016Q4 us-gaap Variable Interest Entity Consolidated Carrying Amount Liabilities
VariableInterestEntityConsolidatedCarryingAmountLiabilities
5000000 USD
CY2014 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
97100000 shares
CY2015 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
96700000 shares
CY2016 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
93700000 shares
CY2014 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
97000000 shares
CY2015 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
96600000 shares
CY2016 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
93500000 shares
CY2016 us-gaap Derivatives Methods Of Accounting Hedging Derivatives
DerivativesMethodsOfAccountingHedgingDerivatives
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Derivative Instruments and Hedging Activities </font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company records its derivatives, if any, in accordance with ASC&#160;815, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Derivatives and Hedging</font><font style="font-family:inherit;font-size:10pt;">. The guidance requires the Company to recognize derivative instruments as either assets or liabilities on the balance sheet at fair value. The accounting for changes in the fair value of a derivative depends on the intended use and designation of the derivative instrument. For a derivative designated as a fair value hedge, the gain or loss on the derivative is recognized in earnings in the period of change at fair value together with the offsetting gain or loss on the hedged item. For a derivative instrument designated as a cash flow hedge, the effective portion of the derivative&#8217;s gain or loss is initially reported as a component of accumulated other comprehensive income (loss) (AOCI) and is subsequently recognized in earnings when the hedged exposure affects earnings. The ineffective portion of the gain or loss is recognized in earnings. We were not party to any derivative-based arrangements at </font><font style="font-family:inherit;font-size:10pt;">December&#160;31, 2016</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">2015</font><font style="font-family:inherit;font-size:10pt;">.</font></div></div>
CY2016 us-gaap Nature Of Operations
NatureOfOperations
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Nature of Operations and Basis of Presentation</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Packaging Corporation of America ("we," "us," "our," "PCA," or the "Company") was incorporated on January 25, 1999. In April 1999, PCA acquired the containerboard and corrugated packaging products business of Pactiv Corporation (Pactiv), formerly known as Tenneco Packaging, Inc., a wholly owned subsidiary of Tenneco Inc. In October 2013, PCA acquired Boise Inc. (Boise). After the acquisition of Boise, we became a large diverse manufacturer of both packaging and paper products. We are headquartered in Lake Forest, Illinois and we operate primarily in the United States. We have approximately </font><font style="font-family:inherit;font-size:10pt;">14,000</font><font style="font-family:inherit;font-size:10pt;"> employees.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We report our businesses in </font><font style="font-family:inherit;font-size:10pt;">three</font><font style="font-family:inherit;font-size:10pt;"> reportable segments: Packaging, Paper, and Corporate and Other. Our Packaging segment produces a wide variety of corrugated packaging products. The Paper segment manufactures and sells a range of papers, including communication-based papers, and pressure sensitive papers. On December 1, 2016, we ceased softwood market pulp operations at our Wallula, Washington mill and permanently shut down the No. 1 machine, with pulp capacity of </font><font style="font-family:inherit;font-size:10pt;">100,000</font><font style="font-family:inherit;font-size:10pt;"> tons. Corporate and other includes support staff services and related assets and liabilities, transportation assets, and activity related to other ancillary support operations. For more information about our segments, see Note </font><font style="font-family:Times New Roman;font-size:10pt;color:#000000;">17</font><font style="font-family:inherit;font-size:10pt;">, </font><font style="font-family:Times New Roman;font-size:10pt;color:#000000;">Segment Information</font><font style="font-family:inherit;font-size:10pt;">.</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The consolidated financial statements include the accounts of PCA and its majority-owned subsidiaries after elimination of intercompany balances and transactions.</font></div></div>
CY2016 us-gaap Use Of Estimates
UseOfEstimates
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Use of Estimates</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. These estimates and assumptions are based on management's best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. We adjust such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates will be reflected in the consolidated financial statements in future periods.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br clear="none"/></font></div></div>

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