International Paper 2014 Annual Report Download - page 120

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84
The service-based Restricted Stock Award program
(RSA), designed for recruitment, retention and special
recognition purposes, also provides for awards of
restricted stock to key employees.
The following summarizes the activity of the Executive
Continuity Award program and RSA program for the
three years ending December 31, 2014:
Shares
Weighted
Average
Grant Date
Fair Value
Outstanding at December 31, 2011 128,917 $27.86
Granted 88,715 31.91
Shares issued (61,083) 27.13
Forfeited (5,000) 28.91
Outstanding at December 31, 2012 151,549 30.49
Granted 67,100 44.41
Shares issued (88,775) 32.30
Forfeited (17,500) 37.75
Outstanding at December 31, 2013 112,374 36.24
Granted 89,500 48.19
Shares issued (83,275) 33.78
Forfeited (4,000) 45.88
Outstanding at December 31, 2014 114,599 $47.03
At December 31, 2014, 2013 and 2012 a total of 16.3
million, 17.8 million and 19.3 million shares,
respectively, were available for grant under the ICP.
Stock-based compensation expense and related
income tax benefits were as follows:
In millions 2014 2013 2012
Total stock-based compensation
expense (included in selling and
administrative expense) $ 118 $ 137 $ 116
Income tax benefits related to stock-
based compensation 92 74 48
At December 31, 2014, $117 million of compensation
cost, net of estimated forfeitures, related to unvested
restricted performance shares, executive continuity
awards and restricted stock attributable to future
performance had not yet been recognized. This amount
will be recognized in expense over a weighted-average
period of 1.6 years.
NOTE 19 FINANCIAL INFORMATION BY
INDUSTRY SEGMENT AND GEOGRAPHIC AREA
International Paper’s industry segments, Industrial
Packaging, Printing Papers and Consumer Packaging
Businesses, are consistent with the internal structure
used to manage these businesses. All segments are
differentiated on a common product, common customer
basis consistent with the business segmentation
generally used in the Forest Products industry.
Following the July 1, 2014 spinoff of xpedx, which
historically represented the Company's Distribution
reportable segment, the assets of the xpedx business
totaling $1.2 billion as of December 31, 2013 were
adjusted off the consolidated balance sheet and are not
included on the consolidated balance sheet as of
December 31, 2014.
For management purposes, International Paper reports
the operating performance of each business based on
earnings before interest and income taxes (EBIT).
Intersegment sales and transfers are recorded at
current market prices.
External sales by major product is determined by
aggregating sales from each segment based on similar
products or services. External sales are defined as
those that are made to parties outside International
Paper’s consolidated group, whereas sales by segment
in the Net Sales table are determined using a
management approach and include intersegment
sales.
The Company also holds a 50% interest in Ilim that is
a separate reportable industry segment. The Company
recorded equity earnings (losses), net of taxes, of
$(194) million, $(46) million and $56 million in 2014,
2013, and 2012, respectively, for Ilim. Equity earnings
(losses) includes an after-tax foreign exchange gain
(loss) of $(269) million, $(32) million and $16 million in
2014, 2013 and 2012, respectively, primarily on the
remeasurement of U.S. dollar-denominated net debt.