Temple-Inland Inc. Reports First Quarter Earnings

Apr 16, 2001, 01:00 ET from Temple-Inland Inc.

    AUSTIN, Texas, April 16 /PRNewswire/ -- Temple-Inland Inc. (NYSE:   TIN)
 today reported first quarter income of $12 million, or $0.24 per diluted
 share, before the cumulative effect of a change in accounting principle.  This
 compares with first quarter 2000 income of $55 million, or $1.04 per diluted
 share, and fourth quarter 2000 income of $35 million, or $0.72 per diluted
 share.  First quarter 2001 income includes $0.08 per diluted share from a
 previously-announced reduction in depreciation expense resulting from a change
 in the estimated useful lives of certain production equipment.
     During the quarter, the company adopted Statement of Financial Accounting
 Standards No. 133, "Accounting for Derivative Instruments and Hedging
 Activities."  As a result, the company recorded a charge of $2 million, or
 $0.04 per diluted share, to reflect the cumulative effect of adopting this
 change in accounting.
     The paper group reported operating income of $21 million in the quarter
 compared with $52 million in first quarter 2000 and $42 million in fourth
 quarter 2000.  The decline in earnings was primarily attributable to higher
 energy costs, which were up $22 million in the quarter compared with first
 quarter 2000 and up $18 million compared with fourth quarter 2000.  Shipments
 of corrugated containers in first quarter 2001 were down approximately
 3% compared with first quarter 2000 and flat compared with fourth quarter 2000
 levels.  Containerboard production was curtailed by approximately 100,000 tons
 in the quarter.
     Average prices for corrugated containers in first quarter 2001 were
 8% higher than first quarter 2000 prices, and relatively stable compared with
 fourth quarter 2000.  The cost of old corrugated containers was 37% lower in
 first quarter 2001 compared with first quarter 2000 and down 4% compared with
 fourth quarter 2000.
     The building products group reported an operating loss of $9 million in
 the quarter, compared with operating income of $37 million in first quarter
 2000 and an operating loss of $3 million in fourth quarter 2000.  Lumber
 prices in first quarter 2001 were down 19% compared with first quarter 2000
 levels; however, prices improved in the quarter and were up 5% compared with
 fourth quarter 2000.  Average prices for particleboard and medium density
 fiberboard were down compared with first quarter 2000 and fourth quarter 2000
 levels.  Gypsum prices and demand continue to be under pressure, and prices
 were down 53% compared with first quarter 2000 and 13% compared with fourth
 quarter 2000.
     The building products group continued to curtail production in all
 products in the quarter to match customer demand.  Energy costs for this group
 were approximately $3 million higher compared with first quarter 2000 and
 $1 million higher compared with fourth quarter 2000.
     The financial services group reported operating income of $45 million in
 the quarter, compared with $35 million in first quarter 2000 and $56 million
 in fourth quarter 2000.  This group continues to benefit from growing the loan
 portfolio and customer deposits and diversifying assets by geography and
 product.
     In announcing results, Kenneth M. Jastrow, II, chairman and chief
 executive officer of Temple-Inland Inc., said, "The slowing U.S. economy and
 higher energy costs continue to negatively affect our paper and building
 products operations.  We are diligently monitoring our inventories and are
 committed to match production with our demand.  Market conditions for
 corrugated packaging and building products historically improve in the second
 quarter, but current demand remains below normal levels.  As a result, we
 expect only modest improvement in the second quarter."
     "The financial services group is poised for another good year as it
 continues to benefit from a growing and diverse loan portfolio and a larger
 customer deposit base.  In addition, this group is beginning to experience
 positive results from offering a wider range of financial products to
 customers, thereby further growing a stream of earnings that is not subject to
 the same cycles as our paper and building products operations."
     Temple-Inland Inc. is a major manufacturer of corrugated packaging and
 building products, with a diversified financial services operation.  The
 company manages its 2.2 million acres of forestland in accordance with the
 Sustainable Forestry Initiative (SFI)(SM) program of the American Forest &
 Paper Association to ensure that forest management is conducted in a
 scientifically sound and environmentally sensitive manner.  Temple-Inland's
 common stock (TIN) is traded on the New York Stock Exchange and the Pacific
 Exchange.
     This release contains forward-looking statements that involve risks and
 uncertainties.  The actual results achieved by Temple-Inland may differ
 significantly from the results discussed in the forward-looking statements.
 Factors that might cause such differences include general economic, market, or
 business conditions; the opportunities (or lack thereof) that may be presented
 to and pursued by Temple-Inland and its subsidiaries; competitive actions by
 other companies; changes in laws or regulations; and other factors, many of
 which are beyond the control of Temple-Inland and its subsidiaries.
 
                      TEMPLE-INLAND INC. AND SUBSIDIARIES
                                  (UNAUDITED)
                    (in millions, except per share amounts)
 
                                                            First Quarter
                                                          2001         2000
 
     Total revenues                                      $1,053       $1,067
 
     Income before accounting change                        $12          $55
     Effect of accounting change                             (2)         ---
     Net income                                             $10          $55
 
     Diluted earnings per share:
      Income before accounting change                     $0.24        $1.04
      Effect of accounting change                         (0.04)         ---
       Net income                                         $0.20        $1.04
 
     Average shares outstanding - diluted                  49.3         52.9
 
 
                                   Business Segments
 
     Revenues
     Paper                                                 $512         $520
     Building products                                      169          238
     Financial services                                     372          309
      Total revenues                                     $1,053       $1,067
 
     Income
     Paper                                                  $21          $52
     Building products                                       (9)          37
     Financial services                                      45           35
     Segment operating income*                               57          124
     Corporate and other                                     (8)          (8)
     Parent company interest - net                          (28)         (25)
     Income before taxes                                     21           91
     Income taxes                                            (9)         (36)
     Income before accounting change                         12           55
     Effect of accounting change                             (2)         ---
     Net income                                             $10          $55
 
      *  2001 segment operating income includes a $7 million reduction in
         depreciation expense resulting from a change in the estimated useful
         lives of certain production equipment, of which $5 million is
         applicable to Paper and $2 million to Building Products.
 
 
                      TEMPLE-INLAND INC. AND SUBSIDIARIES
                                  (UNAUDITED)
                              STATISTICAL DATA (A)
 
                                                             First Quarter
                                                            2001       2000
 
     Net revenues (in millions)
 
     Paper                                                  $512        $520
 
     Building products:
     Pine lumber                                             $48         $65
     Particleboard                                            47          62
     Medium density fiberboard                                26          25
     Gypsum wallboard                                         13          32
     Fiberboard                                               13          19
     Other                                                    22          35
 
      Total Building products                               $169        $238
 
 
     Unit sales
 
     Paper (in thousand tons) (B)                            641         713
 
     Building products:
     Pine lumber - mbf                                       162         178
     Particleboard - msf (3/4" basis)                        154         181
     Medium density fiberboard - msf (3/4" basis)             71          69
     Gypsum wallboard - msf                                  141         178
     Fiberboard - msf (1/2" basis)                            79          97
 
      (A) Revenues and unit sales do not include joint venture operations
      (B) Includes boxes sold and open market sales of linerboard
 
      CONTACT:  Doyle R. Simons
                (512) 434-3737
 
 

SOURCE Temple-Inland Inc.
    AUSTIN, Texas, April 16 /PRNewswire/ -- Temple-Inland Inc. (NYSE:   TIN)
 today reported first quarter income of $12 million, or $0.24 per diluted
 share, before the cumulative effect of a change in accounting principle.  This
 compares with first quarter 2000 income of $55 million, or $1.04 per diluted
 share, and fourth quarter 2000 income of $35 million, or $0.72 per diluted
 share.  First quarter 2001 income includes $0.08 per diluted share from a
 previously-announced reduction in depreciation expense resulting from a change
 in the estimated useful lives of certain production equipment.
     During the quarter, the company adopted Statement of Financial Accounting
 Standards No. 133, "Accounting for Derivative Instruments and Hedging
 Activities."  As a result, the company recorded a charge of $2 million, or
 $0.04 per diluted share, to reflect the cumulative effect of adopting this
 change in accounting.
     The paper group reported operating income of $21 million in the quarter
 compared with $52 million in first quarter 2000 and $42 million in fourth
 quarter 2000.  The decline in earnings was primarily attributable to higher
 energy costs, which were up $22 million in the quarter compared with first
 quarter 2000 and up $18 million compared with fourth quarter 2000.  Shipments
 of corrugated containers in first quarter 2001 were down approximately
 3% compared with first quarter 2000 and flat compared with fourth quarter 2000
 levels.  Containerboard production was curtailed by approximately 100,000 tons
 in the quarter.
     Average prices for corrugated containers in first quarter 2001 were
 8% higher than first quarter 2000 prices, and relatively stable compared with
 fourth quarter 2000.  The cost of old corrugated containers was 37% lower in
 first quarter 2001 compared with first quarter 2000 and down 4% compared with
 fourth quarter 2000.
     The building products group reported an operating loss of $9 million in
 the quarter, compared with operating income of $37 million in first quarter
 2000 and an operating loss of $3 million in fourth quarter 2000.  Lumber
 prices in first quarter 2001 were down 19% compared with first quarter 2000
 levels; however, prices improved in the quarter and were up 5% compared with
 fourth quarter 2000.  Average prices for particleboard and medium density
 fiberboard were down compared with first quarter 2000 and fourth quarter 2000
 levels.  Gypsum prices and demand continue to be under pressure, and prices
 were down 53% compared with first quarter 2000 and 13% compared with fourth
 quarter 2000.
     The building products group continued to curtail production in all
 products in the quarter to match customer demand.  Energy costs for this group
 were approximately $3 million higher compared with first quarter 2000 and
 $1 million higher compared with fourth quarter 2000.
     The financial services group reported operating income of $45 million in
 the quarter, compared with $35 million in first quarter 2000 and $56 million
 in fourth quarter 2000.  This group continues to benefit from growing the loan
 portfolio and customer deposits and diversifying assets by geography and
 product.
     In announcing results, Kenneth M. Jastrow, II, chairman and chief
 executive officer of Temple-Inland Inc., said, "The slowing U.S. economy and
 higher energy costs continue to negatively affect our paper and building
 products operations.  We are diligently monitoring our inventories and are
 committed to match production with our demand.  Market conditions for
 corrugated packaging and building products historically improve in the second
 quarter, but current demand remains below normal levels.  As a result, we
 expect only modest improvement in the second quarter."
     "The financial services group is poised for another good year as it
 continues to benefit from a growing and diverse loan portfolio and a larger
 customer deposit base.  In addition, this group is beginning to experience
 positive results from offering a wider range of financial products to
 customers, thereby further growing a stream of earnings that is not subject to
 the same cycles as our paper and building products operations."
     Temple-Inland Inc. is a major manufacturer of corrugated packaging and
 building products, with a diversified financial services operation.  The
 company manages its 2.2 million acres of forestland in accordance with the
 Sustainable Forestry Initiative (SFI)(SM) program of the American Forest &
 Paper Association to ensure that forest management is conducted in a
 scientifically sound and environmentally sensitive manner.  Temple-Inland's
 common stock (TIN) is traded on the New York Stock Exchange and the Pacific
 Exchange.
     This release contains forward-looking statements that involve risks and
 uncertainties.  The actual results achieved by Temple-Inland may differ
 significantly from the results discussed in the forward-looking statements.
 Factors that might cause such differences include general economic, market, or
 business conditions; the opportunities (or lack thereof) that may be presented
 to and pursued by Temple-Inland and its subsidiaries; competitive actions by
 other companies; changes in laws or regulations; and other factors, many of
 which are beyond the control of Temple-Inland and its subsidiaries.
 
                      TEMPLE-INLAND INC. AND SUBSIDIARIES
                                  (UNAUDITED)
                    (in millions, except per share amounts)
 
                                                            First Quarter
                                                          2001         2000
 
     Total revenues                                      $1,053       $1,067
 
     Income before accounting change                        $12          $55
     Effect of accounting change                             (2)         ---
     Net income                                             $10          $55
 
     Diluted earnings per share:
      Income before accounting change                     $0.24        $1.04
      Effect of accounting change                         (0.04)         ---
       Net income                                         $0.20        $1.04
 
     Average shares outstanding - diluted                  49.3         52.9
 
 
                                   Business Segments
 
     Revenues
     Paper                                                 $512         $520
     Building products                                      169          238
     Financial services                                     372          309
      Total revenues                                     $1,053       $1,067
 
     Income
     Paper                                                  $21          $52
     Building products                                       (9)          37
     Financial services                                      45           35
     Segment operating income*                               57          124
     Corporate and other                                     (8)          (8)
     Parent company interest - net                          (28)         (25)
     Income before taxes                                     21           91
     Income taxes                                            (9)         (36)
     Income before accounting change                         12           55
     Effect of accounting change                             (2)         ---
     Net income                                             $10          $55
 
      *  2001 segment operating income includes a $7 million reduction in
         depreciation expense resulting from a change in the estimated useful
         lives of certain production equipment, of which $5 million is
         applicable to Paper and $2 million to Building Products.
 
 
                      TEMPLE-INLAND INC. AND SUBSIDIARIES
                                  (UNAUDITED)
                              STATISTICAL DATA (A)
 
                                                             First Quarter
                                                            2001       2000
 
     Net revenues (in millions)
 
     Paper                                                  $512        $520
 
     Building products:
     Pine lumber                                             $48         $65
     Particleboard                                            47          62
     Medium density fiberboard                                26          25
     Gypsum wallboard                                         13          32
     Fiberboard                                               13          19
     Other                                                    22          35
 
      Total Building products                               $169        $238
 
 
     Unit sales
 
     Paper (in thousand tons) (B)                            641         713
 
     Building products:
     Pine lumber - mbf                                       162         178
     Particleboard - msf (3/4" basis)                        154         181
     Medium density fiberboard - msf (3/4" basis)             71          69
     Gypsum wallboard - msf                                  141         178
     Fiberboard - msf (1/2" basis)                            79          97
 
      (A) Revenues and unit sales do not include joint venture operations
      (B) Includes boxes sold and open market sales of linerboard
 
      CONTACT:  Doyle R. Simons
                (512) 434-3737
 
 SOURCE  Temple-Inland Inc.