Exhibit 13
Statements of Income (Unaudited) Boise Cascade Office Products Corporation
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Three Months Ended Year Ended
December 31 December 31
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1999 1998 1999 1998
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(expressed in thousands,
except share information)
Net sales $893,256 $814,219 $3,381,725 $3,067,327
Cost of sales 663,685 598,083 2,511,882 2,278,845
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Gross profit 229,571 216,136 869,843 788,482
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Selling and warehouse operating expense 168,761 162,509 653,575 593,672
Corporate general and administrative expense 13,122 13,708 51,220 51,505
Goodwill amortization 3,667 3,316 14,800 12,673
Other operating (income) expense -- 10,138 (3,195) 10,138
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185,550 189,671 716,400 667,988
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Income from operations 44,021 26,465 153,443 120,494
Interest expense 6,207 6,011 24,387 25,914
Other income, net 85 30 1,371 1,331
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Income before income taxes 37,899 20,484 130,427 95,911
Income tax expense 16,193 10,561 55,570 42,844
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Net income $ 21,706 $ 9,923 $ 74,857 $ 53,067
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Net income before nonroutine items (1) $ 21,706 $ 17,369 $ 72,193 $ 60,513
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Earnings per share--basic and diluted $ .33 $ .15 $ 1.14 $ .81
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Earnings per share--basic and diluted before nonroutine items (1) $ .33 $ .26 $ 1.10 $ .92
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(1) See `Other Operating (Income) Expense' in Notes to Quarterly Financial
Statements.
Balance Sheets Boise Cascade Office Products Corporation
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(Unaudited)
December 31
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1999 1998
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(expressed in thousands,
except share information)
Assets
Current
Cash and cash equivalents $ 25,038 $ 31,838
Receivables, less allowances of $9,112 and $9,539 449,753 394,013
Inventories 234,313 226,955
Deferred income tax benefits 17,121 14,335
Other 34,285 31,532
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760,510 698,673
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Property
Land 28,292 28,572
Buildings and improvements 155,798 143,192
Furniture and equipment 244,481 214,611
Accumulated depreciation (182,190) (149,071)
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246,381 237,304
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Goodwill, net of amortization $51,908 and $37,108 475,271 494,883
Other assets 54,155 30,885
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Total assets $1,536,317 $1,461,745
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Liabilities and Shareholders' Equity
Current
Notes payable $ 19,300 $ 72,100
Current portion of long-term debt 2,810 2,065
Accounts payable
Trade and other 328,412 279,928
Boise Cascade Corporation 35,608 29,297
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364,020 309,225
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Accrued liabilities
Compensation and benefits 47,256 38,144
Income taxes payable 16,910 796
Taxes, other than income 11,691 9,466
Other 71,454 36,861
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147,311 85,267
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533,441 468,657
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Other
Long-term debt, less current portion 344,386 354,224
Other 25,384 75,950
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369,770 430,174
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Shareholders' equity
Common stock, $.01 par value, 200,000,000 shares authorized; 65,806,612
and 65,758,524 and shares issued and outstanding 658 658
Additional paid-in capital 359,643 359,224
Retained earnings 283,337 208,480
Accumulated other comprehensive income (10,532) (5,448)
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Total shareholders' equity 633,106 562,914
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Total liabilities and shareholders' equity $1,536,317 $1,461,745
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Statements of Cash Flows (Unaudited) Boise Cascade Office Products Corporation
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Year Ended December 31
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1999 1998
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(expressed in thousands)
Cash provided by (used for) operations
Net income $ 74,857 $ 53,067
Items in income not using (providing) cash
Depreciation and amortization 60,698 50,911
Deferred income taxes (6,544) (5,087)
Restructuring charge and writedown of assets (3,988) 7,981
Receivables (55,740) (30,398)
Inventories (3,909) (26,007)
Accounts payable and accrued liabilities 62,100 28,250
Current and deferred income taxes 4,635 896
Other, net 5,022 (6,243)
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Cash provided by operations 137,131 73,370
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Cash used for investment
Expenditures for property and equipment (47,628) (65,974)
Acquisitions (9,369) (27,282)
Other, net (25,580) (21,488)
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Cash used for investment (82,577) (114,744)
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Cash provided by (used for) financing
Additions to long-term debt 80,800 210,000
Payments of long-term debt (89,893) (214,385)
Notes payable (52,800) 48,800
Other, net 539 42
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Cash provided by (used for) financing (61,354) 44,457
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Increase (decrease) in cash and cash equivalents (6,800) 3,083
Balance at beginning of the period 31,838 28,755
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Balance at December 31 $ 25,038 $ 31,838
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Notes to Quarterly Financial Statements Boise Cascade Office Products
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Corporation
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Organization and Basis of Presentation. Boise Cascade Office Products
Corporation (together with its subsidiaries, the "Company" or "we")
headquartered in Itasca, Illinois, is one of the world's premier business-to-
business distributors of products for the office with operations in Australia,
Belgium, Canada, France, Spain, the United Kingdom, and the United States. At
December 31, 1999, Boise Cascade Corporation owned approximately 81% of our
outstanding common stock. These financial statements are unaudited statements
which do not include all Notes to Financial Statements and should be read in
conjunction with our 2000 Form 10-K. The 2000 Form 10K will be available in
March 2000.
Other Operating (Income) Expense. During the second quarter of 1999, we revised
the amount of a restructuring reserve that we established in the fourth quarter
of 1998 for our U.K. operations. The restructuring program was less costly than
originally anticipated. As a result, we recorded an increase to operating
income of approximately $4.0 million ($2.7 million, net of tax benefit or $.04
per share - diluted) in the second quarter of 1999. The increase to income
included a favorable adjustment to "Cost of sales" in the Statements of Income
of about $0.8 million, which resulted from a lower than expected inventory
write-down. The remaining $3.2 million of income is included in "Other
operating income" in the Statements of Income.
Earnings Per Share. Unaudited basic earnings per share for the three months and
year ended December 31, 1999 and 1998, were computed by dividing net income by
the weighted average number of shares of common stock outstanding during the
periods. Unaudited diluted earnings per share for the three months and year
ended December 31, 1999 and 1998, include the weighted average impact of stock
options assumed exercised using the treasury method.
Acquisitions. In January 1999, we acquired the office supply business of
Wallace Computer Services. In September 1999, we acquired the office supply
business of Supply West. The annual sales of these acquisitions were
approximately $50 million at the time of announcement. The results of
operations of acquired businesses are included in our operations subsequent to
the dates of acquisition.
Income Taxes. The tax provision rate for the twelve months ended December 31,
1999, was 42.7%, compared with a tax provision rate of 44.75% for the same
period in the prior year.