International Paper 2014 Annual Report Download - page 98

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62
Also in the fourth quarter of 2013, the Company calculated
the estimated fair value of its xpedx business using the
discounted future cash flows and wrote off all of the
goodwill of its xpedx business, totaling $400 million. The
decline in fair value of the xpedx reporting unit and resulting
impairment charge was due to a significant decline in
earnings and a change in the strategic outlook for the xpedx
operations. As a result, during the fourth quarter of 2013,
the Company recorded a total goodwill impairment charge
of $512 million, representing all of the recorded goodwill
of the xpedx business and the India Papers business.
No goodwill impairment charges were recorded in 2012.
OTHER INTANGIBLES
Identifiable intangible assets comprised the following:
2014 2013
In millions at
December 31
Gross
Carrying
Amount
Accumulated
Amortization
Gross
Carrying
Amount
Accumulated
Amortization
Customer relationships
and lists $ 561 $ 157 $ 602 $ 139
Non-compete
agreements 74 53 76 (a) 46
Tradenames, patents
and trademarks 61 44 67 33
Land and water rights 81 9 76 5
Fuel and power
agreements 5372
Software 23 22 17 15
Other 43 21 75 32
Total $ 848 $ 309 $ 920 $ 272
(a) Includes $15 million recorded to write-off a tradename intangible
asset of the Company's India Papers business. This amount is
included in Impairment of goodwill and other intangibles in the
accompanying consolidated statement of operations.
The Company recognized the following amounts as
amortization expense related to intangible assets:
In millions 2014 2013 2012
Amortization expense related to
intangible assets $73$79$54
Based on current intangibles subject to amortization,
estimated amortization expense for each of the succeeding
years is as follows: 2015 – $64 million, 2016 – $55 million,
2017 – $52 million, 2018 – $47 million, 2019 – $46 million,
and cumulatively thereafter – $275 million.
NOTE 10 INCOME TAXES
The components of International Paper’s earnings from
continuing operations before income taxes and equity
earnings by taxing jurisdiction were as follows:
In millions 2014 2013 2012
Earnings (loss)
U.S. $ 565 $775$419
Non-U.S. 307 453 548
Earnings (loss) from continuing
operations before income taxes
and equity earnings $ 872 $1,228 $967
The provision (benefit) for income taxes (excluding
noncontrolling interests) by taxing jurisdiction was as
follows:
In millions 2014 2013 2012
Current tax provision (benefit)
U.S. federal $ 175 $(663)$ (3)
U.S. state and local 9(98) 12
Non-U.S. 74 95 100
$ 258 $(666)$ 109
Deferred tax provision (benefit)
U.S. federal $(67)$ 206 $ 220
U.S. state and local 5(18) 5
Non-U.S. (73) (20) (28)
$(135)$ 168 $ 197
Income tax provision (benefit) $ 123 $(498)$ 306
The Company’s deferred income tax provision (benefit)
includes a $13 million benefit, a $7 million provision and
a $25 million provision for 2014, 2013 and 2012,
respectively, for the effect of changes in non-U.S. and
U.S. state tax rates.
International Paper made income tax payments, net of
refunds, of $172 million, $291 million and $95 million in
2014, 2013 and 2012, respectively.