International Paper 2012 Annual Report Download - page 116

Footnotes to Interim Financial Results
(a) Gross margin represents net sales less cost of
products sold, excluding depreciation, amor-
tization and cost of timber harvested.
(b) Includes a pre-tax charge of $20 million ($12
million after taxes) related to the write-up of the
Temple-Inland inventories to fair value, a pre-tax
charge of $21 million ($16 million after taxes) for
an inventory write-off, severance and other
charges related to the restructuring of the
Company’s xpedx operations, a pre-tax charge
of $43 million ($33 million after taxes) for
integration costs associated with the acquisition
of Temple-Inland, a pre-tax charge of $16 million
($10 million after taxes) for early debt
extinguishment costs, a pre-tax gain of $7 mil-
lion ($6 million after taxes) for adjustments
related to the sale of the Shorewood business,
and a gain of $1 million (before and after taxes)
for other items.
(c) Includes a pre-tax charge of $12 million ($8 mil-
lion after taxes) for an inventory write-off, sev-
erance and other charges related to the
restructuring of the Company’s xpedx oper-
ations, a pre-tax charge of $35 million ($22 mil-
lion after taxes) for integration costs associated
with the acquisition of Temple-Inland, a pre-tax
charge of $10 million ($6 million after taxes) for
debt extinguishment costs, a pre-tax charge of
$62 million ($38 million after taxes) to adjust the
long-lived assets of the Hueneme mill in Oxnard,
California to their fair value in anticipation of its
divestiture, a pre-tax charge of $9 million ($5
million after taxes) for costs associated with the
third-quarter 2012 divestiture of the Hueneme
mill and two other containerboard mills, a pre-
tax charge of $6 million ($4 million after taxes)
for an adjustment related to the sale of Shore-
wood, and charges of $2 million (before and
after taxes) for other items.
(d) Includes a pre-tax charge of $9 million ($5 mil-
lion after taxes) for an inventory write-off, sev-
erance and other charges related to the
restructuring of the Company’s xpedx oper-
ations, a pre-tax charge of $58 million ($34 mil-
lion after taxes) for integration costs associated
with the acquisition of Temple-Inland, a pre-tax
charge of $13 million ($8 million after taxes) for
debt extinguishment costs, a pre-tax charge of
$16 million ($11 million after taxes) for costs
associated with the restructuring of the Compa-
ny’s Packaging business in Europe, a pre-tax
charge of $19 million ($49 million after taxes) for
costs associated with the containerboard mill
divestitures and a pre-tax gain of $5 million ($0
million after taxes) for other items.
(e) Includes a pre-tax charge of $28 million ($19
million after taxes) for integration costs asso-
ciated with the acquisition of Temple-Inland, a
pre-tax charge of $9 million ($6 million after
taxes) for debt extinguishment costs, a pre-tax
charge of $7 million ($4 million after taxes) for
costs associated with the restructuring of our
xpedx operations, a gain of $2 million (before
and after taxes) for proceeds associated with the
2010 sale of the Arizona Chemical business, a
gain of $2 million (before and after taxes) for
adjustments related to the sale of the Compa-
ny’s Shorewood operations, a charge of $1 mil-
lion (before and after taxes) for costs associated
with the containerboard mill divestitures, and
pre-tax charges of $5 million ($4 million after
taxes) for other items.
(f) Includes a net expense of $14 million related to
internal restructurings and a $5 million expense
to adjust deferred tax assets related to post-
retirement prescription drug coverage (Medicare
Part D reimbursements).
(g) Includes a pre-tax charge of $32 million ($19
million after taxes) for early debt extinguishment
costs, a pre-tax charge of $7 million ($4 million
after taxes) for costs associated with the
restructuring of the Company’s xpedx oper-
ations, and a charge of $8 million (before and
after taxes) for asset impairment costs asso-
ciated with the Inverurie, Scotland mill which
was closed in 2009.
(h) Includes a pre-tax gain of $50 million ($30 mil-
lion after taxes) for an earnout provision related
to the sale of the Company’s Kraft Papers busi-
ness completed in January 2007. Also, the
Company sold its Brazilian Coated Paper busi-
ness in the third quarter 2006. Local country tax
contingency reserves were included in the busi-
ness’ operating results in 2005 and 2006 for
which the related statute of limitations has
expired. The reserves were reversed and a tax
benefit of $15 million plus associated interest
income of $6 million ($4 million after taxes) was
recorded.
(i) Includes a gain of $7 million (before and after
taxes) related to a bargain price adjustment on
an acquisition by our joint venture in Turkey.
(j) Includes a pre-tax charge of $27 million ($17
million after taxes) for an environmental reserve
related to the Company’s property in Cass Lake,
Minnesota, a pre-tax gain of $21 million
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