OfficeMax 2006 Annual Report Download - page 30

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26
Corporate and Other
Corporate and Other expenses were $118.1 millionfor 2006. We recorded expenses largely
related to the headquarters consolidation in the Corporate andOther segment totaling$46.4 million
during 2006. Corporate and Other expenses were $118.5 million for 2005. During 2005 we recorded
$56.9 million of expenses in the Corporate and Other segment for headquarters consolidation, one-
time severance payments and other expenses, primarily professional service fees, which arenot
expected to be ongoing. Excluding the expenses related toheadquarters consolidation, one-time
severance payments and other expenses, the year-over-year increase in our Corporate and Other
expenses were primarily due to increased incentive compensation expense. In2004, ourCorporate
and Other segment realized income of $184.3 million, which included a $280.6 million gain from theSale
and $15.9 million of costs for one-time benefits granted to employees. Excluding these items, Corporate
and Other expenses were$80.4 million in 2004.
Boise Building Solutions
Operating Results
For the period from January 1to October 28, 2004, sales and operating income for Boise Building
Solutions was $3,257.7 millionand $319.2 million, respectively. On October 29, 2004, we completed
the Sale.
Boise Paper Solutions
Operating Results
For the period from January 1to October 28, 2004, sales and operating income for Boise Paper
Solutions was $1,670.4 millionand $38.8 million, respectively. OnOctober 29, 2004, we completed
the Sale.
Sale of Paper, Forest Products and Timberland Assets
On October 29, 2004,we completed the sale ofour paper, forest productsand timberland assets
to affiliates ofBoise Cascade, L.L.C., a new company formed by Madison DearbornPartners LLC. The
assets that we sold were included in our Boise BuildingSolutions and Boise Paper Solutions
segments. TheSale completed the company’s transition, begun in themid-1990s,froma
predominantly manufacturing-based company to an independent officeproducts distribution
company. Some assets of the businesses we sold, such as the facility near Elma, Washington and
Company-owned life insurance, were retained by OfficeMax, as weresomeliabilities including those
associated with retiree pension and benefits, litigation and environmental remediation at selected sites
and facilities previously closed.
In connection with the Sale, we recorded a $280.6 million gain in ourCorporate and Other
segment. OnOctober 29, 2004, we invested $175 million insecurities ofaffiliates of Boise
Cascade, L.L.C.This investment represents continuing involvement as defined in Statement of
Financial Accounting Standards (“SFAS”) 144, “Accounting for the Impairment orDisposal of Long-
Lived Assets.” Accordingly, we do not show the historical results of the paper, forest products and
timberland assets as discontinued operations. An additional $180 million of gainonthe Sale was
deferred as a result ofour continuing involvement with Boise Cascade, L.L.C. We expect to recognize
this gain as we reduce our investment in affiliates of Boise Cascade, L.L.C.
The considerationfor the timberlands portion of theSale included $1.6 billion of timber
installment notes. We monetized the timber installment notes in December 2004 for proceeds of
$1.5 billion. We realized net cash proceeds from the Sale of$3.3billion in 2004 after allowing for the