Financial Information
	2007	2006	2005
Total Revenue (US$M)	7,420	7,157	6,812

Smurfit-Stone Container Corporation was a global paperboard and paper-based packaging

Pulp and paper industry

The global pulp and paper industry is dominated by North American , northern European and East Asian countries...

 company based in Creve Coeur, Missouri

Creve Coeur, Missouri

Creve Coeur, derived from French for "heartbreak" , is a second-ring suburb of St. Louis, located in west St. Louis County, Missouri, United States. The city derives its name from Creve Coeur Lake, which is shaped like a broken heart. The population was 17,833 at the 2010 census...

, and Chicago, Illinois. It had approximately 21,000 employees. In 2007, Smurfit-Stone was ranked 13 in PricewaterhouseCoopers

PricewaterhouseCoopers

PricewaterhouseCoopers is a global professional services firm headquartered in London, United Kingdom. It is the world's largest professional services firm measured by revenues and one of the "Big Four" accountancy firms....

' "Top 100" forest

Forest

A forest, also referred to as a wood or the woods, is an area with a high density of trees. As with cities, depending where you are in the world, what is considered a forest may vary significantly in size and have various classification according to how and what of the forest is composed...

, paper

Paper

Paper is a thin material mainly used for writing upon, printing upon, drawing or for packaging. It is produced by pressing together moist fibers, typically cellulose pulp derived from wood, rags or grasses, and drying them into flexible sheets....

, and packaging companies in the world (ranked by sales revenue). The company is also among the world's largest paper recyclers

Paper recycling

Paper recycling is the process of recovering waste paper and remaking it into new paper products. There are three categories of paper that can be used as feedstocks for making recycled paper: mill broke, pre-consumer waste, and post-consumer waste. Mill broke is paper trimmings and other paper...

.

Rock-Tenn

Rock-Tenn

Rock-Tenn Company is a paper and packaging manufacturer based in Norcross, Georgia, United States. RockTenn is one of North America's leading producers of corrugated and consumer packaging and recycling solutions, with annualized net sales of approximately $10 billion...

 bought the company in a $3.5 billion deal that closed in May 2011.

Introduction

Smurfit-Stone Container Corporation (Nasdaq: SSCC) is the industry’s leading integrated manufacturer of paperboard and paper-based packaging. The company is the largest North American producer of containerboard, corrugated containers, multiwall and specialty bags

Paper bag

A paper bag or paper sack is a preformed container made of paper, usually with an opening on one side. It can be one layer of paper or multiple layers of paper and other flexible materials. A bag is used for packaging and/or carrying items....

, and clay-coated recycled boxboard (CRB)

Paperboard

Paperboard is a thick paper based material. While there is no rigid differentiation between paper and paperboard, paperboard is generally thicker than paper. According to ISO standards, paperboard is a paper with a basis weight above 224 g/m2, but there are exceptions. Paperboard can be single...

. It was also a leading producer of solid bleached sulfate paperboard (SBS)

Solid bleached board

Solid Bleached Board or Solid bleached sulphate is a virgin fibre grade of paperboard.This grade is made purely from bleached chemical pulp and usually has a mineral or synthetic pigment coated top surface in one or more layers as well as a coated reverse side...

, folding carton

Folding carton

The folding carton created the packaging industry as it is known today, beginning in the late 19th century. Basically, a folding carton is made of paperboard, and is cut, folded, laminated and printed for transport to manufacturers. The cartons are shipped flat to a manufacturer, which has its own...

s, flexible packaging, labels and point-of-purchase displays. SSCC was one of the world’s largest paper recyclers, a key raw material for its products.

History

SSCC was formed in November 1998, with the merger of Jefferson Smurfit Corporation (JSC) and Stone Container Corporation (Stone). JSC’s roots go back to 1974, when Dublin, Ireland-based Jefferson Smurfit Group (JSG) acquired partial interest in Time Industries, a Chicago-based paper and packaging company. JSG established a major presence in the United States with the 1981 acquisition of the Alton Box Board Company and the 1982 acquisition of Diamond International’s packaging operations. In 1983, JSG’s U.S. operations reorganized. The majority of these operations became subsidiaries of JSC. JSC went on to establish a leadership position in the U.S. paper and packaging industry with its 1986 acquisition of 50 percent of Container Corporation of America (CCA) from Mobil Corporation. Morgan Stanley Leveraged Equity Fund II (MSLEF II) purchased the other half of CCA. JSC restructured as a privately held company in 1989, jointly owned by JSG and MSLEF II. As part of the restructuring, JSC acquired the remainder of CCA. In 1994, JSC recapitalized as a publicly traded company.

Stone Container was founded in 1926 as J.H. Stone and Company. In 1945, it incorporated under the name Stone Container Corporation. In the 1950s, Stone expanded outside of Chicago, buying and building corrugated container plants in Pennsylvania, Ohio, Indiana, and Michigan. The company acquired facilities from Continental Group in 1983 and acquired additional facilities from Champion International in 1986.

The merger of JSC and Stone in 1998 brought together two leaders of the paper-based packaging industry. In conjunction with the merger closing, JSG purchased 20 million shares of JSC’s stock from MSLEF II and certain other investors. In May 2000, SSCC acquired St. Laurent Paperboard, Inc. In September 2002, the company acquired MeadWestvaco’s Stevenson, Alabama, containerboard mill and related operations. That same month, JSG privatized and distributed its stake in SSCC. Today, neither JSG nor MSLEF II are stockholders of Smurfit-Stone. In March 2003, SSCC exchanged its European assets for JSG’s 50 percent ownership of Smurfit-MBI, a Canadian packaging company, and $189 million cash. SSCC now owns 100 percent of Smurfit-MBI. As a result of this transaction, SSCC is focused almost exclusively on the North American market.

Products

Smurfit-Stone has two reportable business segments. The containerboard and corrugated containers segment accounts for 75 percent of net sales and includes the company’s containerboard mills and corrugated container operations. The consumer packaging segment represents 20 percent of net sales and consists of CRB, folding carton plants, and multiwall and specialty bag operations. It also includes packaging equipment, flexible packaging, tube, and label plants. Other operations include nonreportable segments, which accounts for 5 percent of net sales and primarily consists of recycling operations, including collection centers and brokerage sales offices.

Products and services

Smurfit-Stone produces a wide selection of paper-based packaging products (many of which are "environmentally sustainable"), including corrugated boxes and protective packaging, corrugated pallets, containerboard, kraft paper, market pulp, packaging equipment, and point of purchase displays.

A few examples of Smurfit-Stone’s environmentally sustainable packaging are:

-The eight-sided META case, which provides corrugated packaging that utilizes less material while offering improved stacking strength, stronger shelf impact, and other benefits.

-The EnviroShell, which serves as a recyclable, corrugated alternative to traditional blister packs and includes easily separated and recycled PET inserts. These inserts help lead to EnviroShell’s 89 percent reduction in plastic use compared to the traditional blister packs.

-RecyclaCorr is a fully recyclable product that offers a replacement to wax imbued mediums. It provides strength under both dry and humid conditions and has 100% recycled fiber content. Some common applications of RecyclaCorr include packaging produce, protein, beverages, bakery products, products that sustain freeze/ thaw cycles, and products that require high humidity storage.

Smurfit-Stone also provides paper and packaging-related services, which include recycling solutions, packaging research and development, and pulp and paper services.

Safety

Smurfit-Stone has been an industry leader in safety performance since 2001. In 2007, Smurfit-Stone’s U.S. operations had an OSHA recordable case rate of 1.05, the best in company and industry history. This represents an 84 percent improvement in the company’s recordable case rate since the implementation of Smurfit-Stone’s SAFE process in 1995.
The SAFE process, which stands for Smurfit-Stone Accident-Free Environment, promotes five core beliefs:

1. All injuries are preventable
2. Safety is everyone’s responsibility
3. Working safely is a condition of employment
4. Training employees to work safely is essential
5. Safety is good business

Air

Smurfit-Stone sets out to solve sustainable packaging requirements of its customers without threatening the ability of future generations to fill their needs. To ensure this mission is carried out, the company works to reduce its environmental footprint in every way possible.
Smurfit-Stone is a member of the Chicago Climate Exchange

Chicago Climate Exchange

The now defunct Chicago Climate Exchange was North America’s only voluntary, legally binding greenhouse gas reduction and trading system for emission sources and offset projects in North America and Brazil....

 (CCX), committing to achieve greenhouse gas emission reductions of 6 percent below baseline by 2010. The company has also put its Load Max Initiative into place, which reduces green house gas emissions by maximizing trailer usage and thereby placing fewer trucks on the highway.
Overall, Smurfit-Stone has reduced its use of fossil fuel by 20% since 1998 and has already met the obligation of CCX Phase I to reduce green house gas emissions by 312,000 tons, a goal that was met by utilizing such practices as the combined heat and power process (CHP) to burn biomass in mills.

Forestry

Smurfit-Stone is one of the founding members of the Sustainable Forestry Initiative

Sustainable Forestry Initiative

The Sustainable Forestry Initiative is a 'forest certification standard' and program of SFI Inc., a non-profit organization. The Sustainable Forestry Initiative is the world’s largest single forest certification standard by area....

(SFI). By subscribing to the SFI Environmental Standards, Smurfit-Stone uses the SFI Certified Sourcing Label. To obtain that label, Smurfit-Stone is required to maintain two-thirds of its raw materials for packaging from SFI-certified sources and must also make efforts to inform landowners on the importance of practicing sustainable forestry.
Smurfit-Stone utilizes a Forest Resources program, which provides high-quality virgin wood fiber to its mills, manages company forestlands (approximately 1 million acres), and maintains a nursery and tree improvement program. The nurseries in this program grow over 24 million pine seedlings annually to replace trees that have been harvested by Smurfit-Stone.

The manufacturing process used by Smurfit-Stone’s kraft paper mills utilizes most parts of trees. Bark and sawdust are used as biomass

Biomass

Biomass, as a renewable energy source, is biological material from living, or recently living organisms. As an energy source, biomass can either be used directly, or converted into other energy products such as biofuel....

 fuel for boilers; the debarked tree is processed into fiber, which is refined to make paper; the remaining chemicals are recovered and reused as a source of fuel for the boilers; and the wood residuals that Smurfit-Stone cannot use are sent to third parties who reuse them as biomass fuel or to enrich soil quality.

Recycling

Smurfit-Stone is also among the leading collectors of recycled paper and non-paper based recovered materials worldwide, operating the world’s largest paper recycling business. In 2007, Smurfit-Stone collected a record 7 million tons of recyclable materials, and annually reuse approximately 45% of collected fiber in Smurfit-Stone mills. Smurfit-Stone has also recently begun using their capabilities to recycle third party wastes such as plastic, metal, and glass.

Sustainability

In continuing efforts to promote environmental sustainability throughout the industry, Smurfit Stone is a member of the World Business Council for Sustainable Development

World Business Council for Sustainable Development

The World Business Council for Sustainable Development is a CEO-led, global association of some 200 international companies dealing exclusively with business and sustainable development....

 (WBCSD), an organization that provides a medium for companies to share knowledge and experience, expand sustainable development, and voice company positions on relevant issues. Smurfit-Stone partners with organizations such as the National Council for Air and Stream Improvement, the Rocky Mountain Elk Foundation

Rocky Mountain Elk Foundation

The Rocky Mountain Elk Foundation is a conservationist organization, founded in the United States in 1984 by four hunters from Troy, Montana with the mission of ensuring the future of elk, other wildlife, and their habitat...

, the Michigan United Conservation Club, and the Alabama Treasure Forest Association.

Smurfit-Stone carries out its business in compliance with the environmental, health, and safety principles of the American Forest and Paper Association. They conduct routine evaluations to confirm the status of this compliance and to monitor their facilities’ environmental management systems.

Community involvement

Smurfit-Stone actively takes a role in improving local communities with financial and volunteer-based contributions. In December 2007, Smurfit-Stone Container Company pledged $1 million to the YMCA of Greater St. Louis. They now aim to raise $30 million for the organization by 2009. In March, 2007, Smurfit-Stone provided their company wellness center to the YMCA in West Point, VA. The building is now used to house the Greater West Point Family YMCA. Smurfit-Stone’s recycling division has sponsored American Cancer Society fundraising events for more than 10 years, raising around $1 million to directly benefit the St. Louis Hope Lodge Center. Smurfit-Stone works with several other organizations such as Habitat for Humanity, Project Learning Tree, American Red Cross, United Way, March of Dimes, and Juvenile Diabetes Research Foundation.

Bankruptcy & corporate reorganization

In early January 2009, The Wall Street Journal

The Wall Street Journal

The Wall Street Journal is an American English-language international daily newspaper. It is published in New York City by Dow Jones & Company, a division of News Corporation, along with the Asian and European editions of the Journal....

 announced that Smurfit-Stone had hired lawyers to plan for a potential bankruptcy filing - which caused an 83% collapse of Smurfit-Stone's stock price. On January 27, 2009, Smurfit-Stone filed petitions for reorganization under Chapter 11

Chapter 11, Title 11, United States Code

Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most...

 in the U.S. Bankruptcy Court

United States bankruptcy court

United States bankruptcy courts are courts created under Article I of the United States Constitution. They function as units of the district courts and have subject-matter jurisdiction over bankruptcy cases. The federal district courts have original and exclusive jurisdiction over all cases arising...

 in Wilmington, Delaware

Wilmington, Delaware

Wilmington is the largest city in the state of Delaware, United States, and is located at the confluence of the Christina River and Brandywine Creek, near where the Christina flows into the Delaware River. It is the county seat of New Castle County and one of the major cities in the Delaware Valley...

.

The company's CEO claims Smurfit-Stone was forced to file bankruptcy because of higher operations costs, burdensome debt levels from prior corporate mergers, and weakened demand for packaging caused by a global economic recession

Late 2000s recession

The late-2000s recession, sometimes referred to as the Great Recession or Lesser Depression or Long Recession, is a severe ongoing global economic problem that began in December 2007 and took a particularly sharp downward turn in September 2008. The Great Recession has affected the entire world...

. Pending court approval, the company hopes to obtain debtor-in-possession (DIP) financing

Debtor-in-possession financing

Debtor-in-possession financing or DIP financing is a special form of financing provided for companies in financial distress or under Chapter 11 bankruptcy process. Usually, this security is more senior than debt, equity, and any other securities issued by a company...

to continue ongoing business operations, payment of employee wages and benefits, and payment of existing vendor obligations.

Recent Openings

In May 2009, Smurfit-Stone opened a high-tech corrugated container producing facility in New Lenox, Illinois. The new plant will employ 145 people and supply companies in the pizza, oil lubricants, detergents and household goods, cooking, and health care industries.

External links

• Smurfit-Stone Official website