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Investor Roadshow | August 4, 2016
Investor Roadshow | August 4, 2016
Forward-Looking Statements
Certain statements in these slides and made during this presentation may be considered forward-looking
statements. These statements reflect management's current views and are subject to risks and
uncertainties that could cause actual results to differ materially from those expressed or implied in these
statements. Factors which could cause actual results to differ include but are not limited to: (i) the level of
our indebtedness and changes in interest rates; (ii) industry conditions, including but not limited to
changes in the cost or availability of raw materials, energy and transportation costs, competition we face,
cyclicality and changes in consumer preferences, demand and pricing for our products; (iii) global
economic conditions and political changes, including but not limited to the impairment of financial
institutions, changes in currency exchange rates, credit ratings issued by recognized credit rating
organizations, the amount of our future pension funding obligation, changes in tax laws and pension and
health care costs; (iv) unanticipated expenditures related to the cost of compliance with existing and new
environmental and other governmental regulations and to actual or potential litigation; (v) whether we
experience a material disruption at one of our manufacturing facilities; (vi) risks inherent in conducting
business through joint ventures; (vii) the receipt of regulatory approvals for our pending transaction to
purchase the pulp business of Weyerhaeuser Company and the successful fulfillment or waiver of all other
closing conditions without unexpected delays or conditions; (viii) the successful financing of the
Weyerhaeuser transaction; (ix) the failure to realize the expected synergies and cost-savings from the
Weyerhaeuser transaction or delay in realization thereof; and (x) our ability to achieve the benefits we
expect from all strategic acquisitions, divestitures and restructurings. These and other factors that could
cause or contribute to actual results differing materially from such forward-looking statements are
discussed in greater detail in our Securities and Exchange Commission filings. We undertake no
obligation to publicly update any forward-looking statements, whether as a result of new information,
future events or otherwise.
2
Investor Roadshow | August 4, 2016
Statements Relating to Non-GAAP Financial Measures
During the course of this presentation, certain non U.S. GAAP financial measures
will be presented, such as Operating EPS, EBIT, EBITDA, EBITDA Margin, Free
Cash Flow and ROIC.
As with our non-GAAP measure “Operating Earnings,” the earnings-related
components of Operating EPS, EBIT, EBITDA, EBITDA Margin and ROIC are
non-GAAP earnings measures, which are adjusted to exclude special items and
non-operating pension expense from our GAAP net earnings. Therefore, references
to such measures should be considered “Adjusted,” as the measures themselves
are non-GAAP measures that we have further adjusted.
A reconciliation of all presented non-GAAP measures (and their components) to
U.S. GAAP financial measures is available on the company’s website at
internationalpaper.com under Performance/Investors.
3
Investor Roadshow | August 4, 2016
Ilim JV Information
All financial information and statistical measures regarding our 50/50 Ilim joint
venture in Russia (“Ilim”), other than historical International Paper Equity Earnings
and dividends received by International Paper, have been prepared by the
management of Ilim. Ilim management has indicated that the financial information
was prepared in accordance with International Financial Reporting Standards and
extracted from Ilim’s financial statements, but International Paper has not verified
or audited any of this information. Any projected financial information and
statistical measures reflect the current views of Ilim management and are subject
to risks and uncertainties that could cause actual results to differ materially from
those expressed or implied by such projections. See “Forward-Looking
Statements.”
4
Investment Thesis
Investor Roadshow | August 4, 2016 6
IP Investment Thesis | Long-Term Value Creation
To be among the most successful, sustainable and
responsible companies in the world
• Fiber-based Packaging, Pulp and Paper
• Advantaged positions in advantaged markets
• Strong and sustainable Free Cash Flow
• Increase value creation
• Exceed shareholders’ TSR expectations
Vision
Strategy
Shareholder Value
Investor Roadshow | August 4, 2016
IP Investment Thesis | Leveraging Selective Choices
7
Cost Positions
• Low-cost asset base
− Mill footprint on cost curve
− Disciplined capital
investment
• Sustained low-cost
positions through
operational excellence
and optimization
• Fiber-based Packaging, Pulp and Paper
• Advantaged positions in advantaged markets
Strategy
Renewable
Natural Resources
Availability and access to
low-cost, sustainable fiber
in key manufacturing
regions
Channels to Market
• Strong market positions
• Sell products in markets
where they are valued
• Winning with the right
customers and segments
Investor Roadshow | August 4, 2016 8
IP Investment Thesis | Delivering Shareholder Value
Capital Allocation
Strong and sustainable free cash flow to:
Fund dividends (40-50% of FCF)
Enable opportunistic share buybacks
Maintain healthy balance sheet and
credit rating
Reinvest in the businesses and
strengthen portfolio
• Strong and sustainable Free Cash Flow
• Increase value creation
• Exceed shareholders’ TSR expectations
Shareholder Value
Value Creation Levers
Improve what we have:
Manufacturing excellence efforts
Commercial optimization
Targeted investments (IRR>WACC):
Riegelwood conversion
Madrid mill acquisition / conversion
N.A. Industrial Packaging projects
Acquisition of Weyerhaeuser
pulp business
Investor Roadshow | August 4, 2016
Capital Allocation | IP’s Balanced Use of Cash
9
Systematically Return Cash to Shareholders
Trough-Tested Sustainable Dividend
Opportunistic Share Repurchases
Cash From
Operations Maintain Strong
Balance Sheet
& Credit Rating
Appropriate Liquidity & Debt Coverage
Proactively Manage Pension Plan
Selective Reinvestment
Value Creating-Healthy Spread
Above Cost of Capital
Improving Competitive Position
Effective Capital Spending
Maintenance & Regulatory Needs
High Return, Cost Reduction Projects
9
Investor Roadshow | August 4, 2016 10
Delivering on Our Commitments For Value Creation
Strategically
Reinvest in Business Return Cash to
Shareholders
Maintain Strong
Balance Sheet
Robust Capital Allocation Strategy
Annualized Dividend Share Buybacks
$1.5B share buyback (September 2013)
Additional $1.5B
authorization (July 2014)
Running our businesses well and generating strong FCF;
Returns consistently above cost of capital
$1.05 $1.20
$1.40
$1.60 $1.76
4Q11 4Q12 4Q13 4Q14 4Q15
Investor Roadshow | August 4, 2016
Global
Economic
Recession
11
Expanded Spread of ROIC1 Above Cost of Capital | Increasing Shareholder Value
4.5%
6.3%
7.5%
6.5%
5.0%
8.1%
9.5%
8.3%
9.3% 9.2%
11.0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
5-Year Average
9.5%
1 ROIC = Operating Earnings before Interest / Average Invested Capital [Equity (adjusted to remove pension related amounts in OCI, net of tax) + Interest-Bearing Debt]
WACC: 8%
Investor Roadshow | August 4, 2016
Global Economic
Recession
$1.7 $1.6
$1.8
$2.1
$1.8
$0.0
$0.5
$1.0
$1.5
$2.0
$2.5
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
$ B
illi
on
s
12
Strong, Sustainable Free Cash Flow
Free Cash Flow reflects cash provided by continuing operations for 2005 – 2011, based on data in the 10-K for each year at the time of filing. Free Cash Flow reflects
cash provided by operations for 2012 onward.
Excludes net cash pension contributions impacting 2006, 2010, 2011, 2013, 2014 & 2015, cash flows under European accounts receivable securitization beginning in
2009 and ending in 2011, and cash received from Black Liquor Tax Credits in 2009 and 2010. 2012 excludes $120MM cash paid for Temple-Inland change-in-control
agreements, $251MM cash received from unwinding a timber monetization, $44MM cash paid for Temple-Inland pension plan contribution, and $80MM cash paid for
Guaranty Bank settlement. 2013 excludes $31MM cash paid for pension plan contribution and $30MM cash received from Guaranty Bank insurance reimbursements.
2014 excludes $353MM cash paid for pension plan contribution. 2015 excludes $750MM cash paid for pension plan contribution.
Transformation:
$0.5 Billion (average)
5-Year Average
$1.8 Billion
Investor Roadshow | August 4, 2016
Compelling Strategic Acquisition | Strengthening IP Global Pulp Business
• IP has agreed to acquire the assets of Weyerhaeuser’s pulp business
for $2.2B (announced May 2, 2016)
• Strengthens IP’s position in the growing global fluff pulp markets
• Adds significant value to IP and for its shareholders
Annual run-rate synergies of ~$175MM expected by end of 2018
Additional cash tax benefit of ~$300MM by purchasing assets
3.6X EBITDA multiple1, net of tax benefit and with synergies
• Weyerhaeuser pulp business consists of best-in-class assets,
outstanding customers and a highly talented workforce
• Expansive portfolio of value-added, innovative pulp products in addition to
fluff pulp will allow IP to offer a broader portfolio of products to customers
• IP has proven track record of successful large-scale integrations
13
1 Based on Weyerhaeuser’s pulp business 2015 EBITDA of $350 Million
Investor Roadshow | August 4, 2016
Compelling Strategic Acquisition | Weyerhaeuser’s Pulp Business
• 2015 sales of $1.5 Billion
• 2015 EBITDA1 of $350 million
• 4 Fluff Pulp Mills (1.5 Million tonnes capacity)
• 1 NBSK Mill (0.4 Million tonnes capacity)
• 2 Converting Facilities
1 Operating profit plus depreciation and amortization less special items
14
Low Cost, Best-in-Class Assets, Products and Technology
Investor Roadshow | August 4, 2016
Weyco & IP Mill Locations
15
Weyco Market Pulp Mill
Weyco Fluff Pulp Mill
IP Fluff Pulp Mill
Converting facilities
Columbus, MS
Port Wentworth, GA
New Bern, NC
Franklin, VA
Georgetown, SC
Riegelwood, NC
Flint River, GA
Pensacola, FL
Grand Prairie, Alberta
Gdansk, Pomorskie
Investor Roadshow | August 4, 2016
Compelling Strategic Acquisition | Asset Purchase Overview
Purchase Price $2.2B
Net Present Value of Asset Step Up for Tax1 $0.3B
Net Price $1.9B
EBITDA Multiple 2
(Net of Tax Benefit) 5.4
Expected Synergies at Full Run Rate $175M
EBITDA Multiple 2
(Net of Tax Benefit & with Synergies) 3.6
1 Estimate 2 Based on 2015 EBITDA of $350 million
16
Investor Roadshow | August 4, 2016
Compelling Strategic Acquisition | Acquisition Assessment
Excellent Strategic Fit R
Improves Core Pulp Business R
Returns Greater than Cost of Capital R
Significant Synergies R
Compelling Economics and Tax Step Up R
Quality Assets R
17
Investor Roadshow | August 4, 2016
Other Recent Strategic Moves | Strengthening the IP Portfolio
18
Strategic Rationale: Reflects IP’s commitment to make our
best business even better
Project Intent: Improves system flexibility, enhances quality,
enables further cost reductions and supports future growth
potential (as needed)
Investment: ~$300MM
Containerboard Optimization Announced: 2Q2015
Timing: 2016/2017
Strategic Rationale: Strengthens IP’s Industrial Packaging
business in Europe and takes advantage of integration
benefits
Project Intent: Convert mill to produce recycled
containerboard to enhance the value proposition of the
EMEA corrugated packaging business
Investment: ~$160MM
Madrid Mill Acquisition/Conversion Announced: 1Q2016
Start-up: 2H2017(E)
Strategic Rationale: Improve IP’s earnings and returns by
supplying the region with globally competitive products
primarily through the Ilim JV and from the U.S.
Project Intent: Exit Asia manufacturing for Coated
Paperboard and Industrial Packaging
Economics: • Sun JV: $23MM in cash, $400MM of debt removed from
balance sheet
• Industrial Packaging: $150MM in cash
Exit Asia Manufacturing Consumer Packaging
Announced: 3Q2015
Concluded: 4Q2015
Industrial Packaging
Announced: 4Q2015
Completion: 2Q2016
Strategic Rationale: Increase IP’s capability and capacity
to serve customers in the growing global fluff pulp market
Project Intent: Reposition assets by converting coated
paperboard capacity to fluff pulp
Investment: $135MM
Riegelwood Conversion Announced: 1Q2015
Start-up: 2H2016
Business Overview
Investor Roadshow | August 4, 2016
2005 - 2007 2008 - 2010 2011+
IP Transformation Timeline/Plan
Transformation Plan
Divestitures & Strategic
Reinvestment
Global Recession IP Achieves Cost of Capital Returns
NA Weyco Pkg.
Acquisition
Russia
Ilim JV
India APPM
Acquisition
China
Sun JV
Brazil
VCP Land / Mill Swap
Coated Papers
Wood Products
Forestland
Kraft Paper
Chemicals
Beverage Pkg.
$11B
Asset Sales
China
SCA Pkg.
Brazil
Grupo Orsa Pkg.
NA TIN
Acquisition
Turkey
Olmuksan Pkg.
20
Franklin Fluff
Pulp
Conversion
TIN Bldg.
Products
Sale
xpedx Spin-Off
Riegelwood
Fluff Pulp
Conversion
Valliant PM3
Sun JV
& Asia
Box Sale
Madrid mill
Acquisition
Investor Roadshow | August 4, 2016 21
North America
Brazil
EMEA & Russia
India
Asia2
North America
Recognized Leader in Core Segments:
Corrugated Pkg. Uncoated Papers
Coated Paperboard
Emerging Markets Build Leading Positions in Fiber-based Packaging
& Paper Segments in High-Growth Markets
Positioned in attractive markets with low-cost assets that can generate strong free cash flow and returns that can exceed our cost-of-capital
$17.2B Net Sales
$1.1B Net Sales
$2.6B Net Sales
$1.3B Net
Sales
$0.2B Net Sales
Full-year 2015 net sales data 1 Ilim JV total sales are not consolidated (IP owns 50% of JV) 2 Sun JV sold in October 2015
International Paper | 2015 Global Portfolio in Packaging and Paper
$1.9B1 Ilim JV
Total Sales
Investor Roadshow | August 4, 2016 22
Strong Domestic Market Positions
1st
1st
North America
Latin America
North America
85%
Brazil 7%
Europe 5%
Russia 3%
Europe
2nd
% Total
EBITDA2
2nd
India
Industrial
Packaging Revenue by
Business1
Consumer
Packaging
Uncoated Freesheet
and Pulp
65% 13% 22%
Russia
1st 1st
PULP
PULP PULP PULP
Source: RISI 1 Based on 2015 sales 2 From continuing operations before special items and non-operating pension expense. Does not reflect equity earnings from Ilim JV
Investor Roadshow | August 4, 2016 23
U.S. Exports | Leveraging Strategic Export Opportunities
Fluff Pulp1
(~90% of N.A. production)
Containerboard (~10% of N.A. production)
EMEA
Asia
Latin America
~40% ~45%
~20%
~40%
~40%
% of exports volume shipped to select regions
~5%
1 Excludes volume from the Riegelwood PM18 conversion
Investor Roadshow | August 4, 2016 24
Brazil & Russia Exports | Leveraging Strategic Export Opportunities
Softwood Pulp (~50% of Russia production)
Uncoated Freesheet (~50% of Brazil production)
EMEA
Asia
Latin America ~40%
~55%
~5%
~80%
% of exports volume shipped to select regions
~20%
Investor Roadshow | August 4, 2016
Global
Recession
0.3 0.4 0.5
0.8
1.3 1.3 1.6
2.0
2.5 2.7 2.7
9%
13% 15% 15%
19% 18%
20% 19%
22% 24% 24%
0%
5%
10%
15%
20%
25%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
N.A. Industrial Packaging | Track Record of Success
25
Bu
sin
ess
EB
ITD
A ($
B)
Weyco Packaging
Acquisition & Integration
TIN Acquisition
& Integration EBITDA %
IP EBITDA margins based on North American Industrial Packaging operating profit before special items
Excludes the Recycling Business and revenue from trade volumes
Growth and Margin Expansion through Strategic Acquisitions
and Successful Integrations
Investor Roadshow | August 4, 2016 26
Full-Year 2015 Financial Results
$ Billion (Except as noted)
2013 2014 2015
Sales $23.5 $23.6 $22.4
EBIT1 $2.5 $2.7 $2.6
EPS2 $3.06 $3.00 $3.65
EPS impact of Ilim F/X3 – IP Share
($0.07) ($0.63) ($0.18)
EBITDA1 $4.0 $4.1 $3.9
EBITDA Margin 17.2% 17.5% 17.6%
FCF4 $1.8 $2.1 $1.8
Year-End Debt $9.5 $9.4 $9.3
Cash Balance $1.8 $1.9 $1.0
1 From continuing operations before special items and non-operating pension expense 2 EPS based on Operating Earnings (defined as Net Earnings (GAAP) from continuing operations before special items and non-operating pension expense) 3 Represents F/X impact primarily related to Ilim JV USD-denominated net debt (balance of ~$700MM at year end 2015) 4 See slide #72 for a reconciliation of cash provided by operations to Free Cash Flow
xpedx is reflected as a Discontinued Operation in all periods presented
$3.06 $3.00
$3.65
2013 2014 2015
EPS
Investor Roadshow | August 4, 2016
2Q16 Financial Results
27
2Q15 1Q16 2Q16
Sales ($B) $5.7 $5.1 $5.3
EBIT1 ($MM) $650 $522 $635
Operating EPS2 $0.97 $0.80 $0.92
Operating EPS impact of Ilim F/X3 – IP Share
$0.06 $0.03 $0.01
EBITDA1 ($MM) $978 $806 $936
EBITDA Margin1 17.1% 15.8% 17.6%
Free Cash Flow4 ($MM) $511 $311 $527
1 From continuing operations before special items and non-operating pension expense 2 Operating EPS based on Operating Earnings (defined as Net Earnings (GAAP) from continuing operations before special items and non-operating pension expense) 3 Represents F/X impact primarily related to Ilim JV USD-denominated net debt (balance of ~$0.6B at end of 2Q2016) 4 See slide #72 for a reconciliation of cash provided by operations to free cash flow 5 ROIC = Operating Earnings before Interest / Average Invested Capital [Equity (adjusted to remove pension related amounts in OCI, net of tax) + Interest-bearing Debt]
10.6% 10.6%
1H15 1H16
ROIC5
Appendix
Investor Roadshow | August 4, 2016
Appendix - Table of Contents
Industrial Packaging……………….……………………………………..30-41
Consumer Packaging……….….………………………….……………..42-48
Printing Papers & Pulp..……….………………………………………...49-66
IP Russia & Ilim Group.………….….……………………………………67-70
Financial & Other………………….……………………………………....71-91
Contact Information……………….………………………………………….92
Slides
Investor Roadshow | August 4, 2016
N.A. Containerboard | Supply Positions
Source: 2016 estimated effective containerboard capacity based on RISI Capacity Reports, SEC Filings, and IP data and analysis
2016 Producer Position
Top 5 = 75%
IP 33%
WRK 19%
GP 10%
PCA 9%
KapStone 4%
Others 25%
30
Stone 13%
Smurfit 7%
GP 9%
WY 7%
IP 7% TIN 7%
Others 50%
1995 Producer Position
Top 5 = 43%
Investor Roadshow | August 4, 2016 31
IP N.A. Industrial Packaging | Balanced Global Strategy
1 Includes Saturating Kraft /Gypsum Liner
Source: 2016 estimates based on IP data and analysis
IP’s channels to market provide choices for maximizing value
IP Box Plants ~80%
Open Market ~20%
U.S. ~91%
Non-U.S. ~9%
Export ~55%
Domestic ~45%
EMEA ~40%
Lat Am ~45%
Asia ~15%
N.A. Mill System Capacity ~13.3 Million Tons
Containerboard ~12.9 Million Tons
Other Uses1 ~0.4 Million Tons
Investor Roadshow | August 4, 2016
Global Containerboard Industry | Total Containerboard Trade Flows
Estimated 2015 Global Demand = 172MM tons
32
Net Export, Tons
Net Import, Tons
Countries with Net Import or
Export greater than 100M tons…
Source: 2015 RISI trade estimates and IP Analysis
`
Europe
4.2MM
Europe
4.7MM
N America
5.1MM Africa
0.6MM
S America
0.3MM S America
1.0MM
C America
2.1MM
Africa
0.2MM
Mid East
0.5MM
Asia
1.5MM
Oceania
0.6MM
Investor Roadshow | August 4, 2016 33
IP N.A. Containerboard Mill System | ~13.3 Million Tons Capacity
Source: 2016 estimates based on IP data and analysis; chart includes Saturating Kraft & Gypsum liner
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
Va
llia
nt
Ma
nsfi
eld
Pra
ttvil
le
Ced
ar
Riv
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Re
d R
ive
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Sa
va
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ah
Bo
ga
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Ro
me
Pin
e H
ill
Ora
ng
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Sp
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Vic
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bu
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Ma
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ers
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Ne
wp
ort
Xa
lap
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Th
ou
sa
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on
s
Investor Roadshow | August 4, 2016
$0
$200
$400
$600
$800
$1,000
$1,200
0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000
Ma
nu
fac
turi
ng
Co
sts
($
/To
n)
Cumulative Annual Production (Thousand Tons)
Cash Costs + Delivery to Chicago
Linerboard Global Cost Curve | 94% of IP N.A. Capacity in 1st Cost Quartile
Source: FisherSolve™ 1Q16 data
Prattville
Orange
Henderson
Valliant
Savannah
Rome
Mansfield
Springfield
Campti
Pensacola
Bogalusa
Cedar River
Pine Hill
34
Maysville
Vicksburg
Investor Roadshow | August 4, 2016
N.A. Industrial Packaging Relative EBITDA Margins
35
24.1%
22.2%
19.4%
21.8%
20.4%
17.5%
23.2% 22.6%
18.3%
IP PCA WestRock
2Q15 1Q16 2Q16
23.1%
21.9%
1 Trailing twelve months
IP EBITDA margins based on North American Industrial Packaging operating profit before special items
Excludes the Recycling Business and revenue from trade volumes
Competitor EBITDA margin estimates obtained from public filings and IP analysis
TTM1
TTM1
18.4%
TTM1
Investor Roadshow | August 4, 2016
Note: IP Mix, 2015. Industry Mix, 2014.
Source: IP Analysis
IP Well-Positioned in Attractive Customer Segments
57%
22%
21%
IP Box Shipments by Segment
36
Market Segment IP
Mix
Industry
Mix
Food & Beverage 57% 50%
Processed Food
Protein
Produce
Beverage
Other Non-Durable Goods 22% 30%
Paper Products
Chemicals & Pharma
Other Non-Durables
Durable Goods & Distribution 21% 20%
Building Materials
Other Durables
Shipping & Distribution
Investor Roadshow | August 4, 2016
U.S. Containerboard | Industry Statistics
200
300
400
500
600
700
800
$/short ton
Containerboard Pricing
Linerboard (List Price) Medium (List Price) Linerboard (OMP) Medium (OMP)
Source: RISI
As of Jan 2015, RISI only reports OMP = Open Market Price
37
$200
$300
$400
$500
$600
$700
$800
Jan-90 Jan-95 Jan-00 Jan-05 Jan-10 Jan-15
Investor Roadshow | August 4, 2016 38
Economic Indicators and U.S. Box Demand
Source: IHS Economics & Country Risk, US Short Term Forecast, Feb 2016; RISI North America Containerboard 5-year Forecast, December 2015
70
80
90
100
110
120
130
140
20
01
20
02
20
03
2004
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
Indexed 1
00 =
2001
US Box Shipments US Nondurable Industrial Production US GDP US Industrial Production
Investor Roadshow | August 4, 2016
373 378
390 396
405 401
380 379 380
391 391 395 390
374
345
357 359 360 360 364
369 373
380
389 398
408
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
Sh
ipm
en
ts (
BS
F)
U.S. Corrugated Packaging | Forecast
39
Historical Data Source: Fibre Box Association
2016-2020: 2.3% CAGR (RISI – Mar 2016 5-yr forecast)
RISI Forecast
Investor Roadshow | August 4, 2016
Wood / OCC Fiber Breakeven
25
50
75
100
125
150
175
200
225
25 30 35 40 45 50 55 60 65
OCC Cost Delivered 1
$/ton
Wood Chip Cost Delivered 2
$/ton
Wood Advantaged
OCC Advantaged
2012
2014
40
2013
1 RISI national average OCC price, adjusted for delivery 2 Forest2Market chip equivalent basis index price
2015
1Q16 2Q16
Investor Roadshow | August 4, 2016
Brazil Industrial Packaging | Overview
41
Paulinia Mill
Manaus Box Plant
Box plant
Mill
Rio Verde Box Plant
Paulinia Box Plant Suzano Box Plant Franco da Rocha Mill
Nova Campina Mill
2015 Sales of US $228 Million
Three Containerboard Mills
Four Box Plants
~340 Thousand Tons of Containerboard
Capacity
Sustainable Fiber Supply
Corrugated Domestic Supply Position ~7%
3.8MM
tons¹
1: 2014 Brazilian Board Association (ABPO)
Klabin 17%
WRK 8%
IP 7%
Trombini 6%
Irani 6% Penha
5%
Smurfit Kappa
4%
Others 47%
Investor Roadshow | August 4, 2016
IP Global Coated Paperboard Footprint | Total of 1.6 Million Tons
Coated paperboard mill
North America
1.2 Million Tons
Europe/Russia
370,000 Tons
42
Reflects repurposing of Riegelwood mill to pulp
Investor Roadshow | August 4, 2016
24%
38%
4%
39% 17%
9%
15% 24%
20% 12%
60%
9%
5%
21%
Folding 2.1 MM tons
Cupstock 1.0 MM tons
Liquid 1.3 MM tons
Industry Production by IP’s Key Segments1
N.A. Solid Bleached Sulphate | Supply Positions
1 Does not include Coated Bristols, Platestock, Dish, Tray and others
Folding includes tobacco; Liquid Packaging includes Aseptic
Source: 2015 RISI Capacity with IP Riegelwood excluded; AF&PA; IP Analysis
WRK 31%
IP 21%
GP 14%
Rank Group 13%
Clearwater 13%
Weyco 5%
Industry Capacity for All Segments
43
5.7MM
Tons
~Flat +1.8% (1%)
CAGR 2016 - 2019
Investor Roadshow | August 4, 2016 44
N.A. Consumer Packaging at a Glance
Coated Paperboard mill Foodservice plant
Packaging includes folding carton, liner and liquid; Foodservice includes cupstock and platestock
Specialty Coffee
Theater, Convenience,
Hospitality Packaging
N.A. Consumer Packaging Business ~ $2 Billion Annual Revenue
IP Coated Paperboard ~1.2MM Tons
Quick Service
Food Service
IP Foodservice
Investor Roadshow | August 4, 2016
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
0 5,000 10,000 15,000 20,000
Ma
nu
fac
turi
ng
Co
sts
$/T
on
Cumulative Annual Production (Thousand Tons)
Cash Cost + Delivery to Chicago
Coated Paperboard Global Cost Curve | IP N.A. Capacity in 1st Cost Quartile
Source: FisherSolve™ 1Q16 data
Texarkana
Augusta
45
Riegelwood
Investor Roadshow | August 4, 2016
N.A. Coated Paperboard Historical Financials
219 200 187 211
251
358
254 203 205 203
15%
13%
11%
15% 16%
22%
17%
13% 13% 14%
0%
5%
10%
15%
20%
25%
0
50
100
150
200
250
300
350
400
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
EBITDA
$ MM
EBITDA
%
Before special items
46
Investor Roadshow | August 4, 2016
U.S. Coated Paperboard | Industry Statistics
$450
$550
$650
$750
$850
$950
$1,050
$1,150
$1,250
$/short ton Folding Cartonboard Prices
Bleached Unbleached Recycled
Source: RISI
47
Investor Roadshow | August 4, 2016
U.S. Cup Market
48
• Paper hot cups & food containers continue to experience growth, in part due to
the foam-to-paper conversion
• Consumers making different beverage choices
– Decrease in soda consumption in both fountain & bottle beverages
– Growth in juice & smoothie beverages, bottled sports drinks, tea & coffee, as
well as regular, flavored & carbonated waters
Sources: Technomic Disposables Report 2014; IP Analysis; Huffington Post; Forbes
34% 29% 23%
17% 20% 23%
49% 51% 54%
0
20
40
60
80
100
120
2010 2014 2018
U.S. Cup Demand Market Segmentation
Foam Plastic Paper
Single-Use Foodservice Cup Demand
(Billions) 2010 2014E 2018F
2014-18
CAGR
Paper 52 54 58 1.6%
Hot 15 18 23 6.6%
Cold 37 36 35 (1.1%)
Plastic 18 21 25 4.4%
Foam 36 31 25 (4.7%)
TOTAL 106 106 108 0.5%
Investor Roadshow | August 4, 2016 49
IP Global Papers Footprint | Total of 4.4 Million Tons1
1 Does not include llim JV
Brazil
1.1 MM
N. America
2.0 MM
Europe
0.7 MM
Russia
0.4 MM
Uncoated paper mill
India
0.2 MM
ILIM
0.3 MM
Investor Roadshow | August 4, 2016
Domtar 35%
IP 22%
PCA 10%
GP 10%
Other 23%
GP 15%
IP 13%
Champion 10%
Boise 10% Willamette
9%
WY 9%
Union Camp
9%
Other 25%
1998 Producer Position Top 2 = 28%
Top 4 = 48%
2016 Producer Position Top 2 = 57%
Top 3 = 67%
Note: 2016 producer position adjusted for Domtar Ashdown,
1998, 2016 Source: Poyry Consulting, Fisher International, IP analysis
N.A. Uncoated Freesheet Supply | Supply Positions
50
Investor Roadshow | August 4, 2016
0%
20%
40%
60%
80%
100%
Riverdale Ticonderoga Eastover Georgetown Franklin Riegelwood Pensacola
% G
rad
e / M
ix
Pulp Non UFS Uncoated Freesheet Containerboard 1
Printing Papers & Pulp Mill System | 3.6MM Tons Capacity
1 Non UFS includes Kraft Bag and Uncoated Bristols
Source: IP analysis
Paper
(M Tons) 650 300 730 320 0 0 0
Pulp
(M Tons) 0 0 110 360 320 800 190 C
ap
ac
ity
51
Investor Roadshow | August 4, 2016
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
0 10,000 20,000 30,000 40,000 50,000
Man
ufa
ctu
rin
g C
osts
$/T
on
Cumulative Annual Production (Thousand Tons)
Cash Costs + Delivery to Chicago
Uncoated Freesheet Global Cost Curve | 84% of IP N.A. Capacity in 1st & 2nd Cost Quartiles
Source: FisherSolve ™ 1Q16 data
Georgetown
Riverdale
Ticonderoga
52
Eastover
Investor Roadshow | August 4, 2016
314
575
657 657
513 539 598
499
310 253 261
10%
16%
19% 19% 18%
20%
22%
18%
12% 12% 13%
0%
5%
10%
15%
20%
25%
0
200
400
600
800
1,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
EBITDA %
EBITDA $ MM Papers Only
N.A. Printing Papers | Margin History
Before special items
53
Tons (MM)
4.0 4.1 3.9 3.5 3.0 2.8 2.7 2.7 2.6 2.0 2.0
Investor Roadshow | August 4, 2016
N.A. Printing Papers Relative EBITDA Margins
54
10.6%
14.3%
12.0%
16.8%
12.9%
17.2%
15.0% 14.0%
13.4%
IP Domtar PCA
2Q15 1Q16 2Q16
1 Trailing twelve months
Excludes N.A. Pulp
IP EBITDA margins based on operating profit from continuing operations before special items
Competitor EBITDA margin estimates obtained from public filings and IP analysis
15.8%
TTM1
13.7%
TTM1
13.7%
TTM1
Investor Roadshow | August 4, 2016
U.S. Uncoated Freesheet Demand
Historical Data Source: AF&PA
2016 – 2020: -1.8% CAGR (RISI Feb 2016 5-yr Forecast)
11.6 12.2 12.4
13.3 13.0 13.2
13.7 13.6 14.0 13.9
12.6 12.4 12.3 12.6
12.0 12.3
11.9
10.9
9.7 9.6 9.3 8.9 8.8
8.0 7.9 7.7 7.5 7.4 7.3 7.2
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20
Mil
lio
n T
on
s
Uncoated Freesheet Demand and RISI Forecast
55
RISI Forecast
Investor Roadshow | August 4, 2016
U.S. Uncoated Freesheet | Industry Statistics
$500
$600
$700
$800
$900
$1,000
$1,100
$1,200
$500
$600
$700
$800
$900
$1,000
$1,100
$1,200
$/short ton
Uncoated Freesheet Pricing Trends
RISI 20# Cutsize RISI 50# Offset
Source: RISI
56
Investor Roadshow | August 4, 2016
Latin American Uncoated Freesheet Market
0
50
0
1,0
00
1,5
00
2,0
00
2,5
00
Brazil
Argentina
Colombia
Chile
Peru
Venezuela
Other LatAm
Thousand Short Tons
Demand
Capacity
Latin America is a Net Exporter
Demand Capacity @
91% Op. Rate* Net Exports
2.8 MM 3.0 MM 0.2 MM
Supply & Demand
57
* Excluding Mexico
Source: Ibá / AFCP / RISI / Fisher / IP Estimates
Top 6 Producers > 80%
Others
Smurfit
Kappa
Ledesma
Celulosa
Argentina
Propal
IP
Suzano
35%
30%
6%
4%
4%
3%
18% IP
Suzano
3.3MM
tons
Investor Roadshow | August 4, 2016
IP Brazil Uncoated Freesheet | At a Glance
Mogi Guacu Luiz Antonio Três Lagoas IP Brazil
UFS Paper
Machines 4 2 1 7
UFS Capacity (thousand tons)
463 408 259 1,130
Market Pulp (thousand tons)
33 110 - 143
58
Investor Roadshow | August 4, 2016
IP Brazil | Historical Financials
59
280
317
228
296 320
293
334 326
275
33% 33%
24%
27% 27% 26%
31% 31% 31%
0%
5%
10%
15%
20%
25%
30%
35%
0
50
100
150
200
250
300
350
400
450
2007 2008 2009 2010 2011 2012 2013 2014 2015
EBITDA
US$ MM EBITDA
Margin
Before special items
Tons
(MM) 0.9 1.0 1.2 1.2 1.3 1.3 1.3 1.3 1.2
Investor Roadshow | August 4, 2016 60
IP India Printing Papers | APPM
Hyderabad
Rajahmundry
Kadiyam
Corporate Office
UFS Paper Mill
IP owns 75% of Andhra Pradesh
Paper Mills (APPM); Remaining
25% shares listed in India
Two uncoated freesheet paper
mills with combined capacity of
~250,000 tons
Significant and fast growing
emerging market
Located in the heart of India’s fiber
basket
Successful farm forestry program
IP leaders on ground with APPM
management team to assist with
optimization of assets
Platform for potential growth in
paper and packaging
Investor Roadshow | August 4, 2016
Global Market Pulp | Bleached Softwood Pulp
North America North America
Latin America Latin America
Western Europe Western Europe
Eastern Europe Eastern Europe
Asia Asia
Rest of World Rest of World
0
5
10
15
20
25
30
2015 2019
Mil
lio
n T
on
s
2015 – 2019
CAGR
1.1%
2.4%
2.6%
(1.4%)
(0.8%)
(0.2%)
Source: PPPC
Global Demand = 26.8 → 27.7MM tpy
CAGR = 0.8%
61
Investor Roadshow | August 4, 2016
Global Market Pulp | Fluff Pulp Demand
North America North America
Latin America Latin America
Western Europe Western Europe
Eastern Europe Eastern Europe
Asia
Asia
Other
Other
0
1
2
3
4
5
6
7
8
2015 2019
Mil
lio
n T
on
s
2015 – 2019
CAGR
5.2%
5.6%
1.6%
2.0%
1.3%
2.8%
Source: IP analysis
Global Demand = 5.8 → 6.8MM tpy
CAGR = 3.8%
62
Investor Roadshow | August 4, 2016
Pulp mill
63
IP Global Pulp Capacity | Total of 2.3 Million Short Tons1
Ilim JV
1.8 MM
Europe / Russia
0.3 MM N. America
1.8 MM
L. America
0.2 MM
1 Does not include llim JV
Investor Roadshow | August 4, 2016 64
Global Fluff Pulp Industry | Trade Flows – 2015
Net Import Locations Net Export Locations
Global Demand = 5.8MM stpy
Import
(1.0)MM
87.0% Export
5.1 MM
Import
(0.5)MM
Import
(0.8)MM
Import
(2.4)MM
Source: PPPC, IP Analysis; Units shown in short tons
Investor Roadshow | August 4, 2016
65
Riegelwood & N.A. Pulp System Update
Growing Pulp business
Riegelwood Mill startup underway
Additional 400,000 tons of capacity
on line by mid-year 2016
Flexibility to produce softwood
market pulp while fluff demand
ramps up
IP will have 1.7MM tons of pulp
capacity in N.A. (~1.5MM tons of
which can be fluff)
2007 2009 2013 Post Conversion
Fully Ramped
IP’s Total Fluff Pulp Capacity
~1,500
Th
ou
sa
nd
To
ns
World Demand for Fluff Pulp
50%
~
50%
Source: Poyry World Fibre Outlook up to 2030
Investor Roadshow | August 4, 2016
Pulp | Industry Statistics
0
200
400
600
800
1,000
1,200
USD/admt Global Pulp Prices
NBSK (dne) BEK (dne) Fluff (dne)
Source: RISI
Global pulp prices delivered to Northern Europe; Units shown in metric tonnes
66
Investor Roadshow | August 4, 2016
IP Russia & Ilim JV | Manufacturing Overview
Ilim JV Production1 2014 2015
Bratsk Mill
Total 995 1,163
• Softwood bleached pulp 525 672
• Hardwood bleached pulp 270 293
• KLB 200 198
Koryazhma Mill
Total 1,335 1,353
• PM7 paper 195 188
• PM7 CFS 20 50
• Pulp (BHKP, UKP) 320 311
• KLB and others 800 804
Ust-Ilimsk Mill
Pulp (BSKP, UKP) Total 865 857
IP Russia Production1
Svetogorsk 2015
Total 699
• Coated Paperboard 114
• Pulp (soft/hardwood) 175
• Fine Papers 410
1 Volumes shown in thousand short tons
Koryazhma
Bratsk Ust-Ilimsk
China
Kazakhstan Mongolia
Svetogorsk
Well-Positioned to Serve Target Markets
67
Investor Roadshow | August 4, 2016
$0
$200
$400
$600
$800
$1,000
0 5,000 10,000 15,000 20,000
Man
ufa
ctu
rin
g C
osts
($
/To
n)
Cumulative Capacity (Thousand Tons)
Cash Cost + Delivery to Beijing
68
Ilim Joint Venture | Well-Positioned to Serve Growing Pulp Markets
China will account
for more than 60% of
world’s incremental
market pulp growth
1st quartile cost positions
with favorable access to
China NBSK market
Access to significant
Russian wood basket
2014 - 2030
China
13 MM
Rest of
World
8 MM
1 Source: Poyry World Fibre Outlook up to 2030 (Metric Tonnes) 2 Source: FisherSolve™ 4Q15 data
Ust-Ilimsk
Bratsk
2
Bratsk
(Pre-Project)
Investor Roadshow | August 4, 2016
2009 2010 2011 2012 2013 2014 2015
Sales Volume (Million short tons) 2.6 2.8 2.8 2.9 2.7 3.2 3.3
Sales ($B) 1.3 1.9 2.2 2.0 1.9 2.1 1.9
Debt ($B) 0.4 0.5 0.9 1.2 1.5 1.4 1.2
Operating EBITDA ($MM) 197 516 591 291 208 470 724
F/X Gain (loss)1 (35) 12 (60) 39 (80) (684) (218)
EBITDA ($MM) 163 528 531 330 128 (214) 506
Depreciation ($MM) 120 121 124 134 177 193 240
EBIT ($MM) 43 407 406 196 (49) (408) 266
Interest Expense ($MM) 28 18 7 6 39 69 53
Net Income (loss) ($MM) (19) 266 299 132 (72) (362) 150
IP Equity Earnings (loss) ($MM) (27) 103 134 56 (46) (194) 131
Dividends (to IP) ($MM) 50 34 85 0 0 56 35
Ilim JV results are IFRS basis.
IP Equity Earnings (loss) on US GAAP basis. 1Represents F/X impact primarily related to Ilim JV USD-denominated net debt (balance of ~$700MM at year end 2015)
69
Ilim Joint Venture | Full Year Financials
Investor Roadshow | August 4, 2016
Ilim Joint Venture | 2Q16 vs. 1Q16
70
$ Million 2Q15 1Q16 2Q16
Sales Volume (thousand tons)
826 821 866
Sales $500 $441 $473
Operational EBITDA1 $153 $176 $152
F/X (Impact of USD Net Debt2) $65 $33 $18
IP Equity Earnings3 $67 $62 $46
Strong operational performance continues with good execution in 2Q
IP received $58MM dividend payment
3Q outlook in line with prior quarter excluding 2Q F/X benefit
Ilim JV results are on an IFRS basis with the exception of IP Equity Earnings which is US GAAP 1 Before F/X impact primarily on USD-denominated net debt 2 Represents F/X impact primarily related to Ilim JV USD-denominated net debt (balance of ~$600MM at end of 2Q2016); Ilim Group’s functional currency is the
Ruble (RUB); Non-functional-denominated currency balances are measured monthly using the month-end exchange rate
3 IP Equity Earnings for 2Q15, 1Q16 and 2Q16 include after-tax F/X gains (primarily on USD-denominated net debt) of $27MM, $11MM and $6MM, respectively
Investor Roadshow | August 4, 2016
Operating Business EPS
71
2006 as originally reported
2007-2011 adjusted for elimination of the Ilim JV reporting lag
2006-2010 Net Earnings from continuing operations and before special items; 2010 onward reflects Operating Earnings
xpedx is reflected as a Discontinued Operation from 2010 onward
.12
.35
.40
.47 .45
.52
.57
.73
.45 .49
.41
.15
.07
.27
.38
.22
.05
.44
.85
.72 .76 .77 .78
.67
.58
.49
.77
.66 .64
.61
1.01
.81
.60
.93 .95
.53
.84
.97 .97
.87
.80
.92
.42
.08
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
2006 2007 2010 2008
Impact of Mineral
Rights Gain
2009
.83
2011
.93 Final Land Sale
2012 2013 2014 2015 2016
Investor Roadshow | August 4, 2016
$ Million 2Q15 1Q16 2Q16
Cash Provided by Operations
$8651 $620 $8551
Less Capital Investment
($354) ($309) ($328)
Free Cash Flow $511 $311 $527
Free Cash Flow
72
1 Excludes $750MM cash paid for pension plan contribution in 2Q15, and $250MM in 2Q16
Investor Roadshow | August 4, 2016 73
Balance Sheet | Financial Strength $
Bill
ion
2.9x
$9.5 Balance
Sheet
Debt
$1.1 Op. Lease Adj. $0.8 Op. Lease Adj.
$3.9 Pension Gap
[2.3x]1
2014 2013 2015
3.2x
Adjusted Debt reflects gross balance sheet debt plus pension gap and operating leases (Moody’s Methodology)
Adjusted EBITDA of $4.2B incorporates pension and lease expense adjustments (Moody’s Methodology) 1 Simple Debt Coverage: Balance Sheet Debt / 2013 Reported EBITDA of $4.1B 2 Simple Debt Coverage: Balance Sheet Debt / 2014 Reported EBITDA of $4.1B 3 Simple Debt Coverage: Balance Sheet Debt / 2015 Reported EBITDA of $3.9B
Moody’s Target: Adjusted Debt < 3X Adjusted EBITDA
Pension gap decreased by $0.3B
Made $750MM voluntary pension
contribution
Significant debt restructuring mid-2015
Bond issue and tender offer
successfully reduced debt towers
Raised dividend 10% to $1.76/share
Continued share buybacks of ~$500MM
$1.0B cash balance at year end
$9.4 Balance
Sheet
Debt
[2.3x]2
$0.5 Op. Lease Adj.
$2.2 Pension Gap
3.2x
$9.3 Balance
Sheet
Debt
$3.6 Pension Gap
[2.4x]3
2015 Highlights
Investor Roadshow | August 4, 2016
$0
$200
$400
$600
$800
$1,000
2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040 2042 2044 2046
Mil
lio
n
Debt Maturities Other Debt
1 Primarily foreign debt (intended to be rolled over or refinanced).
Debt Maturity Profile | Maturities as of December 31, 2015
1
74
Investor Roadshow | August 4, 2016
25%
50%
75%
100%
125%
$0
$300
$600
$900
$1,200
$1,500
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016E
Maintenance Regulatory Strategic Cost Reduction % of Depreciation
$ Million % of
Depreciation
Reflects continuing operations
Capital Spending
75
~$1,300
Investor Roadshow | August 4, 2016
Pension Plan Update | As of June 30, 2016
• No contribution 1960-2005;
$2.5B contribution 2006-2013
• $1.1B contribution made in
2014-2015
• $750MM voluntary
contributions planned for 2016
• No contributions required
before 2019
($3.2)
($2.8)
($1.5)
($2.4)
($4.1)
($2.2)
($3.9)
($3.6)
Billio
n
Year-End Funded Status1
76
1 Reflects status as of December 31
Investor Roadshow | August 4, 2016
Pension Plan Update1 | As of December 31, 2015
195
342
545
387
447
364
$0
$150
$300
$450
$600
2011 2012 2013 2014 2015 2016E
Millio
n
Annual Pension Expense2 Key Variables 2014 2015 2016E
Assumed Rate of Return
7.75% 7.75% 7.75%
Discount Rate 4.65% 4.10% 4.4%
Average Annualized Returns3
2015 1.3%
Past Five Years 7.8%
Past Ten Years 7.1%
Portfolio Asset Allocation at 12-31-15
Target Actual
Equity 43% - 54% 48%
Bonds 25% - 35% 33%
Real Estate 7% - 13% 10%
Other 8% - 17% 9% 1 2013 and onward include Temple-Inland pension plan 2 Non-cash expense for U.S. plans only 3 Through December 2015
Pension expense reflects service cost, interest cost, amortization of actuarial losses and expected return on plan assets
For the past 10 years, IP Pension Plan performance ranked in the top decile of the State Street Bank Corporate and Public Master Trust Universe
of approx 200 observations
77
Investor Roadshow | August 4, 2016
Maintenance Outages Expenses | 2015
$ Million 1Q15A 2Q15A 3Q15A 4Q15A 2015A
Industrial Packaging $63 $95 $27 $63 $248
North America 63 93 27 63 246
Brazil 0 2 0 0 2
Printing Papers Total $33 $63 $32 $37 $165
North America 27 41 15 36 119
Europe 0 22 14 1 37
Brazil 6 0 2 0 8
India 0 0 1 0 1
Consumer Packaging $15 $12 $7 $14 $48
North America 15 10 2 14 41
Europe 0 2 5 0 7
Total Impact $111 $170 $66 $114 $461
78
Investor Roadshow | August 4, 2016
Maintenance Outages Expenses | 2016 Forecast
$ Million 1Q16A 2Q16A 3Q16F 4Q16F 2016F
Industrial Packaging $73 $80 $45 $46 $244
North America 73 78 45 46 242
Brazil 0 2 0 0 2
Printing Papers Total $66 $50 $27 $36 $179
North America 66 35 16 17 134
Europe 0 8 10 18 36
Brazil 0 7 0 1 8
India 0 0 1 0 1
Consumer Packaging $19 $3 $2 $15 $39
North America 19 0 0 14 33
Europe 0 3 2 1 6
Total Impact $158 $133 $74 $97 $462
79
Investor Roadshow | August 4, 2016
North American Downtime
80
123
48 93
140 146
72 92 141 125
58
69
53
55
78
230
212
85
Maintenance Economic
20 7
18 12 21 0
41 13
4 29
31
20
1
31
13
29
0
30
11 25
19
12 0
18 15
12
4
29
131
Containerboard Uncoated Papers
Pulp
Th
ou
sa
nd
To
ns
Th
ou
sa
nd
To
ns
Th
ou
sa
nd
To
ns
Th
ou
sa
nd
To
ns
146 150 181
117
0
48
Coated Paperboard
201
31
16
322
46
353
210
Investor Roadshow | August 4, 2016
Total Cash Cost Components | 2Q16 YTD
Fiber 33%
Materials 16%
Freight 12%
Labor 13%
Energy 8%
Overhead 10%
Chemicals 8%
81
North American mills only
Investor Roadshow | August 4, 2016
90
95
100
105
110
115
120
125
130
U.S. Mill Wood Delivered Cost Trend | 2Q16 Average Cost Down 3% vs. 1Q16
Cost Indexed to January 2007 values
2007 2008 2009 2010 2011 2012 2013 2014 2015
82
Investor Roadshow | August 4, 2016
40
60
80
100
120
140
160
180
200
Cost Indexed to January 2007 values
U.S. OCC Delivered Cost Trend | 2Q16 Average Cost Up 7% vs. 1Q16
83
2007 2008 2009 2010 2011 2012 2013 2014 2015
Investor Roadshow | August 4, 2016
0
50
100
150
200
250
U.S. Natural Gas Cost Trend | 2Q16 Average Cost Down 12% vs. 1Q16
84
Cost Indexed to January 2007 values
NYMEX Natural Gas closing prices
2007 2008 2009 2010 2011 2012 2013 2014 2015
Investor Roadshow | August 4, 2016
0
50
100
150
200
250
300
U.S. Fuel Oil Cost Trend | 2Q16 Average Cost Up 38% vs. 1Q16
85
Cost Indexed to January 2007 values
WTI Crude prices
2007 2008 2009 2010 2011 2012 2013 2014 2015
Investor Roadshow | August 4, 2016
75
100
125
150
175
200
U.S. Chemical Composite Cost Trend | 2Q16 Average Cost Down 3% vs. 1Q16
86
Cost Indexed to January 2007 values
Delivered cost to U.S. facilities: includes Caustic Soda, Sodium Chlorate, Starch and Sulfuric Acid 2007 - 2008 excludes WY PKG
2007 2008 2009 2010 2011 2012 2013 2014 2015
Investor Roadshow | August 4, 2016 87
Commodity U. S. Non – U. S.
Energy
Natural Gas (MM BTUs) 75,000,000 11,000,000
Fuel Oil (Barrels) 540,000 460,000
Coal (Tons) 200,000 600,000
Fiber Wood (Tons) 52,000,000 7,700,000
Old Corrugated Containers / DLK (Tons) 4,600,000 400,000
Chemicals
Caustic Soda (Tons) 370,000 70,000
Starch (Tons) 380,000 120,000
Sodium Chlorate (Tons) 150,000 50,000
LD Polyethylene (Tons) 40,000 -
Latex (Tons) 10,000 6,000
2016 Global Consumption | Annual Purchase Estimates for Key Inputs
Investor Roadshow | August 4, 2016 88
Corporate Social Responsibility | Mission
The IP Way: To be among the most successful,
sustainable and responsible companies in the world
Our Corporate Social Responsibility Mission
Use all resources responsibly
Enable sustainable growth
Strengthen people and communities
Investor Roadshow | August 4, 2016 89
Corporate Social Responsibility | Planet
89
Water
Developing a global water stewardship strategy to use water sustainably
Generating more than 70% of energy needs from renewable fuels Improved energy efficiency by 6.1% since 2010 Reduced GHG emissions by 8.3% since 2010
Increased third-party certified fiber by 28% since 2010 IP only accepts fiber that is legally harvested and has known origins
GHG Emissions Forest Stewardship
Investor Roadshow | August 4, 2016 90
Corporate Social Responsibility | People
90
Safety
Reduced serious injuries by 68% since 2010
Reduced Lost Work Day Incident Rate by 25% since 2010
Named for the tenth consecutive year as one of the World’s Most Ethical Companies® by the Ethisphere Institute
Stakeholder dialogue allows us to collaborate with communities and continue to improve
Ethics & Compliance Stakeholder
Engagement
For more information visit
internationalpaper.com/sustainability
Investor Roadshow | August 4, 2016
What Sets IP Apart | Sustainability Is In Our DNA
91
Grow. Create. Sustain.
Investor Roadshow | August 4, 2016
Investor Relations | Contact Information
Jay Royalty • Vice President, Investor Relations
901-419-1731
jay.royalty@ipaper.com
Michele Vargas • Director, Investor Relations
901-419-7287
michele.vargas@ipaper.com
Betty Groom • Financial & Administrative Analyst
901-419-4250
betty.groom@ipaper.com
92
Investor Roadshow | August 4, 2016
FORTUNE’S “World’s
Most Admired
Companies®” 2016
Ethisphere Institute’s
“World’s Most Ethical
Companies®” 2016
Institutional Investor’s
“Most Honored
Company” 2016
IDG’s Computerworld
“100 Best Places to
Work in IT” 2016
2015 AF&PA Better
Practices, Better Planets
2020 Sustainability Award
International Paper Brazil
Graphic Paper
Manufacture 2015
International Paper Russia
Corporate Social
Responsibility Award 2015
International Paper India
Parivartan Award 2015
International Paper Awards & Recognitions
1 From FORTUNE Magazine, March 1, 2016. © 2016 Time Inc. Used under license
1
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